amrx10k20091231ex10-19.htm


    
      

      

    

    
      
        	 	 AIR COMMERCIAL
      REAL ESTATE ASSOCIATION 

                         STANDARD
      INDUSTRIAL/COMMERCIAL

                          MULTI-TENANT
      LEASE – GROSS

              	 
	 	 	 


      

       

    

    RECRODING
OF THIS LEASE PROHIBITED

    1.      Basic Provisions ("Basic
Provisions").

    1.1                 Parties: This Lease ("Lease"), dated for reference purposes only,
November 9, 2009 is made by and between Fullerton Business Center,
LLC (“Lessor”) and Allied Med, Inc., an Oregon
corporation (“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 2488 E.
Fender Avenue, Unit "I” located In the
City of Fullerton, County of
Orange, State
of California,
with zip code 92831, as outlined on
Exhibit “B” attached hereto ("Premises") and
generally described as (describe briefly the nature of the Premises):.
Approximately 1,400 square feet of rentable space including overhang as outlined
in Exhibits “A” and “B” attached hereto and incorporated herein.  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,
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." (Also see Paragraph 2)

    1.2(b)           Parking: TWO (2) unreserved
vehicle parking spaces (Also see Paragraph 2.6.)

    1.3                 Term: Zero years and Six ( 6)
months ("Original Term") commencing December 1, 2009 ("Commencement Date") and
ending Mary 31, 2010* ("Expiration Date"). (Also see Paragraph 3)

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

    1.5                 Base Rent: $840.00
per month ("Base Rent"), payable on the First day of each month commencing
December 1, 2009.  (Also see Paragraph 4)  *see Option to
Renew attached

    [  ]           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: ----------------
percent (0.0060864%)
("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.  Lessee’s share of Common Area Expenses $84.00 per
month, subject to increased based on increases to Lessor.

    1.7                 Base Rent and Other Monies Paid Upon
Execution:

    
      	
               
      

            	
              (a)

            	
              Base Rent $840.00 for
      the period December 1 - 31, 2009.

            


    

    
      	
               
      

            	
              (b)

            	
              Common Area Operating Expenses:
      $84.00 for the period December 1 - 31,
  2009.

            


    

    
      	
               
      

            	
              (c)

            	
              Security
      Deposit:  $1,680.00 (“Security Deposit”). (see also
      Paragraph 5)

            


    

    (d)      Other:  $N/A for
N/A.

    (e)      Total Due Upon Execution of this
Lease:  $2,604.00

    1.8           Agreed Use: Office/Warehouse
used for storage. (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):

     

    

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      – AIR COMMERCIAL REAL ESTATE ASSOCIATION

                	
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        o  N/A
represents Lessor exclusively ("Lessor's Broker");

        o  N/A
represents Lessee exclusively ("Lessee's Broker'); or

        o   N/A
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 ----- or N/A% 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 Jack Amin ("Guarantor").
(See also Paragraph 37)

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

        þ      an
Addendum consisting of
Paragraphs                                                                      1
through 4.

        þ      a
site plan depicting the Premises;

        þ      a
site plan depicting the Project;

        
          	
                  þ

                	
                  a
      current set of the Rules and Regulations and Parking Rules and Regulations
      for the Project; Addendum II

                


        

        o    a
current set of the Rules and Regulations adopted by the owners'
association;

        o  a
Work Letter;

        þ      other           (specify):

        Move-In/Move-Out
Rules: Exhibit "C"; Hazardous Materials Disclosure Form ("Lessee"): Exhibit "D";
Connelly Act.

        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, or acquired by Lessee from a prior tenant (see Paragraph 7.3a), 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, that Landlord Is
aware of. Lessor shall not unreasonably withhold its approval for Lessee, at Lessee's cost, to
test for those substances provided Lessee uses a vendor from Lessor's
approved vendor list. 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 30 days
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). See Addendum I, Item 1, for
additional Information.

        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 of restrictions of record, regulations, and
ordinances in effect on the Start Date (“Applicable
Requirements”).

         

         

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    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 laws, covenants or restrictions of record, regulations and
ordinances ("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-de-net-eemply-with
said-warranty-Lasserahaiirexeeptas-otherwise-provided;
promptly-after-receipt-0f-written-notice
fsom-L-esseeaeHing-fermi-with-specificity-the-nature-and-extent-of-suGh-flora-sompllance-rectify-the-cameot
Lessor's-expenself-Lessee-does-net-give-L-essew+ritten-notice-of-a-non-comp lie
rase-with-th is-wantonly-willair-6-months4ollowing-the-Start-Date;
Correction of that any 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-howevesrthet-if-eush
Capital-E-xpenditureas-required-durng-theaact2 years-of-this-teaseand-the-Gest
thereof-exceeds-6-months=Base-Rent-L-essee-may-instead-terminate
this-Lease-unless Lesser-taetfics Lessee-ln-wr4ting-within.40-daysafler reselpt-ef
Lecsee's-terminatien-notiee-that-L-esssr-has-elected-to-pay-the difference-between-theesteal-sest-thereefand-the-ameunt2gaal4e-6-months=Base-Rent-lFLe
coos-sleets-terminatienrLassee-shalMmmed lately-cease
the-use-of-the-Premises-which-requiresaush-Capital-Expend
ita-sand-deliver-to-L-essor-ashler-noticeapecifyinga-termination-dateat-least-90-days
thereafter.-Such-termination-date-shall-howevere4e-ne-event-be-eariier
than-the-last-day-that Lesseeaeuld-legally-utilize-the-Premises-without
eemmeneing-suetr6apital-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-hewever-that-if-sueh-Capital-Expenditure-is-required-during-the-last-2-years-of
this-Leasea
r-if-Lessor-reasonably-determ fines-that-it4s-not-econsmisa
Ily-feasible-to-pay4ts-share4hereef-Lasso r-shall-have-theaptien-to-term
irate-this Lease-upon-80
days-priow+ritten-nonce-te-Lessee-unless-Lessee-notifies-L-esser-in-writingrwithht-40-daysafte-reseipt-of-L-essor-s-termination-notice
that-Lessee-will-pay-ter-such-Gapital-Expenditure:
lf-Lesse-does-not-eleet-to-terminate-and-fails-ta-tender-its-share-of
any-eueh-Capital-Expenditure; Lessee-mayadva
rase-such-fundsand-ded ueteame-with-Interest-from-Rent-until-Lessor's-she
re-of-such-costs-have-bean-fully-pa id-1 f-Lessee-is-unable to-finanse-Lc:ror's-she
rereNkhe-balance-ef-th e-Rent-duean el-payable-for-the-remain der-s f-ih
IsLease-is-not-su itisient-ts-fully-ream buns-Lessee-sna n sffaetba cis-Lessee-she
IFhave-the-Ag ht-to-term irate-this-L-ease-upon-80-days-written-ns
tile-te-6esssr-

    (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 all 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.

     

     

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      – AIR COMMERCIAL REAL ESTATE ASSOCIATION

                	
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    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 Date Lessee was the owner
or occupant of the Premises. In such event, Lessee shall be responsible for any
necessary corrective work. Prior Occupant shall be defined as Lessee, Joint
Lessee, Sublessee, a corporation or LLC, or any other business entity, its
successors or assigns, or as an officer and/or signator for a corporation or
LLC.

    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 'lave, 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 ne 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.

     

     

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    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 driveways, entrances, parking spaces, parking areas, loading and
unloading areas, ingress, egress, direction of traffic, landscaped areas,
walkways and utility raceways;

    (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.

     

     

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    4.      Rent.

    4.1.           Rent Defined. All monetary
obligations of Lessee to Lessor under the terms of this Lease, Including but not
limited to, Base Rent, Lessee's
share of Operating Expenses, estimated CAM, parking charges, late charges,
service fees and ail other sums and charges of whatever nature, (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
improvement 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 Improvement 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 improvement
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.

     

     

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    (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 statement or 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
toaeorued-late-ehargesand attorney's-fees-second-toamued4nterestethen-to
to Base Rent, and Common Area Operating Expenses, accrued Late Charges,
attorney's
fees, accrued Interest, and any remaining amount to any other outstanding
charges or costs.

    OBLIGATION OF FURNISHER OF CREDIT
INFORMATION. Pursuant to Civil code, Section 1785.26, the Lessee is hereby
notified that a negative
credit report reflecting on Lessee's credit report may be submitted In
the future to a credit reporting agency if Lessee falls to fulfill the terms of
the rental/credit obligations or if Lessee defaults in those obligations in any
way.

    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 therefor 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.

     

     

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    Notwithstanding the restrictions
contained within California Civil Code Section 1950.7, Lessor may
utilize the security deposit for any and all debt owed by Lessee to Lessor,
including, (but not limited to) future rental or worth at the time of the
awarded damages as codified in Civil Code Section 1951.2 , or rent as it accrues
pursuant to Civil Code
Section 1951.4. To the extent that this right is Inconsistent with
California Civil Code Section 1950.7, Lessee waives the protections of
Civil Code Section 1950.7. Lessee waives any rights under California Civil Code
Section 3275 and California Civil Code Section 1174 (c) and 1179 and
any and all current or future laws which give Lessee a right to redeem,
reinstate, or restore this lease after It is terminated as a result of the
Lessee's
breach.

    6.      Use.

    6.1           Use. Lessee shall use and
occupy the Premises only for the Agreed Use er-any-ether-legal-use-which-is-reasonablycomparable
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 service animals for the disabled guide; signal
and-seeing-eye-dogs;
Lessee shall not keep or allow in the Premises any pets, animals, birds, fish,
or reptiles. Lessor may shall-not-unreasonably
withhold or delay its consent to any written request for a modification of the
Agreed Use in Lessor’s sole and absolute discretion..-so-longas-the-same-will
not-impair-the-structural-Integrity-of-the-Building-or-the-meehanisal-er-eleetrisal
cyctems-therein-and/or-is-not-significantly-more-burdensome-te-the Rrojes6
If Lessor elects to withhold consent, Lessor shall within 7 days after
such request give written notification of same.-whish-notice-shall-include
an-explanation-of Lessor's objesilens-to-lhc 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.

     

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    (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. L-essorand-Its-sussessors-andassignscha
lNndemnify-defend reimburse-and-hold-L-essee-its empleyeesand-lenders,
harmless-fremand-against-any-andall-environmental-damages-including-rheaest-of-remediation-whish
-sufferedas -a-direst result-of-HaeardousSubsta
ncesen-the-Premises-pder-to-L-essee-taking-possessienaFwhisha
re-caused-by-the-grass-negligeneear-willful-missondust
of-Lessor-eilsagents-or-empleyeeL-essor's-obligationsasand-when-required-by-the-Applicable-Requirements,
shalHnclude; but-not-be-limited-torthe eostaf-investi gati
on,femoval,remedietlen-re storatlenand%orabatementa ndahall-suwive-the-expi
ration-or-terminatienakhisL-ease-

    (f) Investigations and
Remediations. Lessor-shall-retain-the-responsibility-and-pay-for-any-Investigations-or-remediation
moa su
res-req u fired-by-governmenta
/amities-having-jufisdietion-with-respect-to-the-existenseaf-Hazardous-Substances-on-the-Rremi
sec-p rior-to-Lessee taking-pessessiea-anless
If such remediation
measures is
are required as a result of Lessee's use (including "Alterations", as defined in
paragraph 7.3(a) below) of the Premises,-In-whish-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
during business hours in order to carry out Lessor's investigative and remedial
responsibilities. Although notice is not required, Lessor will attempt to
provide verbal notice
of Intent to enter.

    (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.

     

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    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.

    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.

     

     

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    Acquisition of Existing Trade Fixtures,
Utility Installations, and Alterations: Pursuant to Paragraph 2.2 of the Lease Agreement, Condition,
Lessor makes no representations or warranties as to the condition of existing
Trade Fixtures. Utility Installations and/or Alterations. Prior to the
commencement date under this Lease, Lessee shall satisfy
Itself as to the condition, safety and operability of any and all Trade
Fixtures, Utility Installations, and/or Alterations left by or purchased or
acquired from prior occupant. Lessor shall accept no responsibility for said
trade fixtures/utility installations/Alterations and Lessee agrees to perform maintenance
and service of said
trade fixtures/utility installations and/or Alterations In accordance with Item
7.1 of the Lease Agreement, "Lessees
Obligations", at Lessee's sole cost and expense. If any damage to
Lessee's unit or Lessor's building should result from Lessee's failure to
maintain or repair said trade fixtures/utility installations or Alterations, the
cost of any and all repairs resulting from this damage shall be at the sole cost and expense of
Lessee. Unless stated otherwise herein, any Trade Fixtures, Utility
Installations and/or Alterations acquired from prior occupant shall be
considered Lessee Owned (See Paragraph 7.5(a) "Definitions", as well as those Installed by Lessee,
and are subject to all conditions outlined in Paragraph 7.4.

    (b)      Service Contracts. At Lessor's
option, 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 445% 125% 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 obligated 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 (i.e 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.

     

     

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    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,
(iv) provide Lessor with additional security deposit that shall be determined by
Lessor in Its sole and absolute discretion and to charge the deposit for the
actual cost of Lessor's
vendor to monitor, Inspect or repair any work clone by Lessee's vendor. If Lessor's
actual costs exceed the amount held In Security Deposit, Lessee shall reimburse
Lessor for actual cost(s) upon demand. If all or any portion of the Security
Deposit is used, Lessee shall replenish said deposit which shall be held by
Lessor until Lessee's
tenancy has ended and/or equipment has been removed. 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.

     

     

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    (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 valued as $300 or less, 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 Data or Expiration
Date.

     

     

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    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 and Mid Valley Management as an additional insureds 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.

     

    


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    (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 and Its Agents
from Liability. Notwithstanding the negligence or breach of this Lease by
Lessor or its agents, neither Lessor nor its agents shall be liable under any
circumstances for: (I) 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, (11) any damages arising from any act or neglect of any other tenant of
Lessor or from the failure of Lessor or its agents to enforce the provisions of
any other lease in the Project, or (iii) injury to Lessee's business or for any
loss of income or profit therefrom. Instead, it is intended that Lessee's sole
recourse in the event of such damages or injury be to file a claim on the
insurance policy(ies) that Lessee is required to maintain pursuant to the
provisions of paragraph 8. Lessor's non
liability will apply irrespective of the active or passive negligence of Lessor,
Its agents, partners, or Lenders.

    


    


    


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    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.

    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.

    
 

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    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 data 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 falls 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.

     

    


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    (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=tb-any-L-enders-of-which-Lessee-hasaetual-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.

     

     

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    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 or any part of Lessee's interest in this Lease or
in the Premises without Lessor's prior written consent.

    (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.

     

     

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    (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) Lessors consent to any assignment
or subletting shall not constitute a 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 Lessors
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) Lessors 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. Any Lessee
payment or other sums received by Lessee or any other person in connection with
this Lease shall be conclusively presumed to have been paid by Lessee or on
Lessees behalf. If, as a result of any proposed Assignment or Sublease, Lessee
receives rent or other
consideration, either Initially or over the term of the Assignment or Sublease,
in excess of the rent called for hereunder, or in the case of the Sublease of a
portion of the Premises, in excess of the rent allocable to such portion, Lessee
shall pay to Lessor as additional rent hereunder, all of the excess gross proceeds of each
such payment of

    rent or
other consideration received by Lessee promptly after its receipt. In-ft-event-that-the-amount-solleoted-by-L-esser
exceeds-L-essee's-then-eststanding-ebligahonsany
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.

     

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    (b) In the event of a Breach by Lessee,
Lessor may, at its option, require sublessee to adorn 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.

    


    


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    (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.

    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 1-46-% 125% 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 thisLease entitling Lessor
to the remedies provided for in this Lease and/or by said
statute.

    
 

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    (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 '6 '10 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-L-coder-whew-nameandaddress-shall-have-been-furnished-Lessee-In-writing-for-such-purposerof
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
shelf not be In breach if performance Is commenced within such 30 day period and
thereafter diligently pursued to completion.,

     

    


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    (b)      Performanse-by-t.esseean-Behalf-of-Lessor—In-the-event-that-neither-Lasser-noN-ender-sores-said-breach-within-30-days
after-reseipt-ofaaid-notise-or-if-having-commenced-saidaure-Fhey-do-not-diligently-porous-it-toaompletionrthen-L-cosec-may
elect-to-sure-said-breash at-Lessee's
cxpenseand-effset-frem-Rent-theastaal-and-reasonable-cost-te-pedoma-sushaurerprovided-howeverrt+tateushaffset-shall-net-
exseedan amount-equal-to-the-greater-plane-month's-Base-Rent-oFthe-Secrdly-Deposit,
rcoewing-Lessee's-right-to-reimbursement-from-Lesser-forany-such
expense-in-excess-efeush-of#set--esseeaha
II-document4heaostafeaid-sureand-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-L-essorand4he-Brokers
otherwise egree-in--willing-L-esser-egrees-that-(eH)-if-L-essee-exercises
eny-8ptienr(b)-if Leoseeasquifes-from-L-essetany-rights-to-the-PFemisesar
other-premisesawned-by-Lessor-and-loeated-within-thc
Projectr(e-ifLessee-remains-in-possession-ef-the-Premisesrwith-the-eonsent-of-L-essor-after
the-expitathm-efthis-Leasemer-0:1)4-Base-Rent-is-Increased-whether-byagreementar-eperation-of
an-essalation-douse-here in-then4essorahall-pay
Brokersa-fee-inaecordence-with-the
seheduleafthe-Brokers-in-effeetat-Hre-timeafthe
exesutien-ef-this-L-ease:

    15.2           Assumption-of9bllgations-Any-beyerar-transferee-ofL-essofsinterest-in-this-L-ease-shall-be-deemed-to-have-assumed-t:essor-sobligation-hereunder,-Brekers-shalWe-Ntird-party-benegeiaciesaf-the-pFevisiens-ef-Peragfephs1.10,
16,

     22  end-34—If-L-essor4ails-to-pay-to-Brokers
any-emote
nts-d
usasand-for-bteketage-fees-pertaining-tathis-L-ease-when-deerthen-sushameunts-shalkeesme-I
ntefest—lnaddiho nmif-L-esse r-fails-to payanyamounts-te-L-essee's-Broker-when-duerL-essee's-Broker-may-send-written-netiec
to L-essorand-Lessee-of-such-failureand-if-L-esser-fails-to-pay such-ameents-within
1-0-daysaftet-said-Reusemhessee-shall-pay-said-monies-te4ts-Bteher-and-effset-seehamounts-against-Reh
lreadditiot-Lessee's

    Broker-shall-be-deemed-to-be a
third-pally-benefisiaty-efany-sommissienagreemeet-

    entered-into-byandler-between-L-esserand-L-esseF's-Breker4er-the

    limited-purposeaFsolleetinganybrokefag
e-fee-swede

    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.

     

    


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    16.         Estoppel
Certificates.

    (a) Baeh-Patty Lessee
(as "Responding Party")
shall within 10 days after written notice from the other-Party Lessor. (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, or any other estoppel form requested by Lessor,
plus such additional information, confirmation and/or statements as may be
reasonably requested by the Requesting Party.

    (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 maybe reasonably required by such lender or purchaser,
Including but not limited to Lessee's financial statements for the past 3 years.
Lessor reserves the right during the Lease term to re-verify credit data of any
two previously provided by Lessee or have Lessee provide updated credit data to
Leeesor upon writen request. 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.

    


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    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 Lessee's
signature on this Lease shall be that Party's Lessee's
address for delivery or mailing of notices. The addresses listed in Paragraph 4
of the Addendum I will be the Lessor's address for delivery or mailing of
notices to Lessor. 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 mall 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 Mall 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.

    


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    (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 duly 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 advice 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.

    In the event that Lessee holds over In violation of the
above paragraph, then In addition to the Increase of Base Rent and all
Additional Rent, Lessee shall be liable to Lessor for all costs, losses, claims
or liabilities (including attorney's fees) which Lessor may Incur as a result of
Lessee's
failure to surrender possession of the Premises to Lessor upon the expiration or
earlier termination of this Lease.

    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 initiated in the county in which the Premises are
located.

    


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    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 Devise 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,
than 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 $500 is a
reasonable minimum per occurrence for such services and
consultation).

    


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    32.           Lessor's Access; Showing Premises;
Repairs. 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. Exsept-for.ordinaq=Fer-Sublease'=signs-Whish-may-be-plasedonly-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. See Item 13. of Rules &
Regulations

    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 similar to the most recently
published by the AIR Commercial Real Estate Association,.

    37.2           Default, It shall constitute a
Default of the Lessee if any Guarantor falls 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.

    


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    39.1           Definition. "Option" shall
mean: (a) the right to extend the term of or renew this Lease. or-ts-extend-or-renew-any-lease-that
6essee-has-on-other-property-of-6esser; (b)  the-right-of-fiwt-refusal-eN'irst-offerto lease-eithen4he-premises-or-other-
propertyof-L- esser
(e)-the-righHo purchase-oFthet{ght-eftiret-refusako-purchase-the
Rrewises-erother-property-ef L-esser,

    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. The Project Is not a full security
property and Lessor does not guarantee or warrant the personal security or
safety of Lessee or its Invitees. Lessor does utilize the services of a Courtesy
Patrol Service, the cost of which is Included as a Common Area Maintenance
expense borne by Lessee. However, any cautionary
measures that Lessor takes (whether a Courtesy Patrol Service, gate, or
otherwise) which may presently exist or later be installed on the Property are
neither a guarantee nor warranty against criminal acts of others on the Project
or otherwise.

    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/or install
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.

    (iv)                 Lessor
reserves the right to move Lessee to other, reasonably similar space in the
building or Project. Lessor must provide at least sixty (60) clays prior written notice
to Lessee, In connection therewith, the costs of preparing such other premises
for Lessee's use, together with Lessee's reasonable costs of moving, shall be
borne by Lessor, but In no event shall Lessor be required to pay an amount In
excess of two months Base
Rent.

    (v) Lessor reserves the right,
exercisable with sixty (60) clays notice and without liability to Lessee, to
change the name and address of the Premises. Said sixty (60) clays notice shall
conclusively be deemed reasonable notice to Lessee.

    


    (vi) Lessor reserves the right to
re-run Lessee's
credit at a later date
clue to collection and/or screening purposes.

     

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                ©1998
      – AIR COMMERCIAL REAL ESTATE ASSOCIATION

              	
                  FORM
      MTG-4-5/50E

              


      

    

    


    
      
        
           


        

        
           


          
            

          

        

        
           


        

      

    

    


    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.

    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 to the extent
provided by law, IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR ARISING
OUT OF THIS AGREEMENT.

    48.          Mediation and Arbitration of
Disputes. An Addendum requiring the Mediation and/or the Arbitration of
all disputes between the Parties and/or Brokers arising out of this Lease ❑ is þ 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.

    50.          NONDISCRIMINATION AND NONSEGREGATION
COVENANT. Lessee herein covenants by and for himself or herself, his or
her heirs, executors, administrators, assigns, and for all persons claiming
under or through him or her. This Lease Is made and accepted upon and subject to
the following conditions:

    That there shall be no discrimination
against or segregation of any person or group of persons on account of race,
color, creed, religion, sex, marital status, national origin or ancestry, In the
Leasing, Subleasing, transferring, use, occupancy, tenure and enjoyment of the
Premises herein Leased: nor shall Lessee himself, or any person

    claiming
under or through him or her, establish or permit any such practice or practices
of discrimination and/or segregation with reference to the selection, location,
number, use and occupancy of Lessees, Tenants, Sub lessees, Subtenants,
Assignees and/or Vendees In the Premises herein Leased.

     

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              ©1998
      – AIR COMMERCIAL REAL ESTATE ASSOCIATION

            	
                FORM
      MTG-4-5/50E

            


      

        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

    

     

    51.          PROPOSITION 65 WARNING: The State of
California requires that we
warn you that the property contains chemicals known to the State of
California to cause cancer, birth defects, and other
reproductive harm. These chemicals may be contained in emissions and fumes from
building materials, products and materials used to maintain the property, and
emissions, fumes, and smoke from lessee and Invitees activities, including but
not limited to the use of motor vehicles, and tobacco products. These chemicals
may include, but are not limited to carbon monoxide, formaldehyde, tobacco
smoke, unleaded gasoline, soots, tars, and mineral oils.

    


    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: Fullerton Business
Center                                                                           Executed:

    On:           11/12/09                                                                                                    
          On:

    


    
      	
              By
      LESSOR:

            	
              By
      LESSEE:

            
	
              Fullerton
      Business Center, LLC,

            	 
      
	
              a
      Delaware limited liability company

            	
              Allied
      Med, Inc., an Oregon Corporation

            
	
              By
      The Ezralow Company, LLC, a

            	 
      
	
              Delaware
      limited liability company dba

            	
              /s/
      Jack Amin

            
	
              Mid
      Valley Management, its Managing

            	
              Name
      Printed:  Jack Amin

            
	
              Agent

            	
              Title:
      President

            
	 
      	 
      
	
              By:
      /s/ Terri Rhoades

            	
              By:
      /s/ Jack Amin

            
	
              Name
      Printed: Terri Rhoades

            	
              Name
      Printed:  Jack Amin

            
	
              Title:  Authorized
      Agent

            	
              Title:
      Vice President

            


    

    


    


    Page 32
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                  INITIALS

                	
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                  ©1998
      – AIR COMMERCIAL REAL ESTATE ASSOCIATION

                	
                    FORM
      MTG-4-5/50E

                


        

      

    

    


    
      
        
           


        

        
           


          
            

          

        

        
           


        

      

    

    

      


      
        	
                Name
      Printed:

              	 	
                Address:

              	 
      
	
                Title:

              	 	 
      	 
      
	
                Address:

              	 	 
      	 
      
	 
      	 	
                Telephone:

              	(  
      )
	 
      	 	
                Facsimile:

              	(  
      )
	 
      	 	
                Federal
      ID No.

              	 
      
	
                Telephone:

              	( 
      ) 	 
      	 
      
	
                Facsimile:

              	( 
      )	 
      	 
      
	
                Federal
      ID No.

              	 	 
      	 
      
	 	 	 	 
	 	 	 	 
	 	 	 	 
	
                BROKER:

              	 	 BROKER;	 
	 	 	 	 
	Att:	 	 Att:	 
	
                fide:

              	 	 *illc:-	 
	
                Address:

              	 	 Address:	 
	 	 	 	 
	
                Telephone:

              	 ( 
      )	 Telephene:	 ( 
      )
	Faesimilc:	 	  Faesimilc:	 ( 
      )
	
                FederaHD-No

              	 ( 
      )	  Federal-	 
	 	 	 	 


      

      


       

      NOTICE:
These forms are often modified to meet changing requirements of law and Industry
needs. Always write or call to make sure you are utilizing the most current
form: AIR Commercial Real Estate Association, 800 W 6th Street, Suite 800, Los
Angeles, CA 90017. Telephone No. (213) 687-8777. Fax No.: (213) 687-8616.

       

      (c)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.

       

       

      Page 33
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                    INITIALS

                  	
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                    ©1998
      – AIR COMMERCIAL REAL ESTATE ASSOCIATION

                  	
                      FORM
      MTG-4-5/50E

                  


          

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
           

          ADDENDUM
I for STANDARD INDUSTRIAL/COMMERCIAL

           

          MULTI-TENANT
LEASE GROSS

           

          THIS
ADDENDUM is attached to and integrated as a part of that certain Lease dated
November 9,
2009, by and between Fullerton Business Center,
LLC, "Lessor", and Allied Med, Inc., an Oregon
Corporation,, "Lessee", and
constitutes additional Covenants, Conditions and Agreements contained herein,
which Addendum shall prevail in the event of any conflict between the Covenants,
Conditions and Agreements contained herein and those in said Lease.


           

          CONDITION
OF PREMISES
and COMPLIANCE WITH LAWS
 SEE  ITEMS 2.2 AND 2.3 OF LEASE
AGREEMENT

          1.         Lessee
shall complete and return the "Unit Inspection Checklist" within 30 days of the
lease commencement. A blank "Unit Inspection Checklist" is an attachment to this
Lease, included with your cover letter or is available from Lessor. Unless
otherwise specified in the Lease, Lessor will have no obligation to make
repairs; the Unit Inspection Checklist will be a benchmark documenting the
condition of the Premises when Lessee took possession. If Lessee fails to
complete and return the Unit Inspection Checklist, the Unit will be deemed to be
in good condition and repair at the time that Lessee took
possession.

          Lessee
accepts the Premises in its "as is" condition without any representation or
warranty by Lessor concerning the condition of the Premises. In addition, Lessor
makes no representation or warranty to Lessee that the Premises complies with
Applicable Laws or Requirements.

          


          HAZARDOUS SUBSTANCES DISCLOSURE
STATEMENT — EXHIBIT "D"

          2.         Prior
to executing this Lease, Lessee has delivered to Lessor Lessee's executed
Initial Hazardous Substances Disclosure Certificate (the "Initial HazMat
Certificate"). Lessee covenants, represents and warrants to Lessor that the
information contained in the Initial HazMat Certificate is true and correct and
accurately describes in all respects the use(s) of Hazardous Substances which
will be made and/or used on the Premises by Lessee. Notwithstanding anything to
the contrary contained in the Lease, Lessee shall not have the right to use any
Hazardous Substances at the Premises that are not described on the Initial
HazMat Certificate or to increase the quantity of any Hazardous Material used at
the Premises beyond the quantity described on the Initial HazMat Certificate.
Upon the prior written request of Lessor, Lessee shall deliver to Lessor a new
Hazardous Substances Disclosure Certificate (the "HazMat Certificate") executed
by Lessee and describing Lessee's then-present use of Hazardous Substances on
the Premises. The HazMat Certificates required hereunder shall be in the form
attached hereto as Exhibit "D". .

          


          EARLY
TERMINATION

          3.          Provided
Lessee is not in default of anyof the terms and conditions of this Lease, lessee
agrees that Lessee may terminate this Lease with sixty (60) days written notice
of termination to Lessor.  Initials  /s/  /s/

           

          ADDRESS FOR RENT PAYMENTS AND NOTICES
SEE ITEMS 4.3 AND 23.1
OF
LEASE

          3.         Lessee's
payments of rent and other amounts due, shall be considered to have been
received by Lessor only when received by mail.

          
            	 
      	 
      	 
      
	
                    Rent
      VIA U.S. MAIL:

                  	
                    Rent
      VIA EXPRESS MAIL:

                  	
                    LESSOR
      ADDRESS FOR NOTICES:

                  
	 
      	 
      	
                    Fullerton Business Center,
      LLC

                  
	
                    Fullerton
      Business Center, LLC

                  	
                    Fullerton
      Business Center, LLC

                  	
                    c/o
      Mid Valley Management

                  
	
                    Dept.
      LA 23439

                  	
                    23622
      Calabasas Road, Suite 200

                  	
                    2478
      E. Fender Ave., #A

                  
	
                    Pasadena,
      CA 91185-3439

                  	
                    Calabasas,
      CA                                91302

                  	
                    Fullerton,
      CA 92831

                  


          

           

          Or at
such address as Lessor may from time to time hereafter designate by notice to
Lessee. Rental
payments will
not be accepted by any of Lessor's Leasinq Offices.

           

          Document Reference Date: Dated
this 9th Day
of November, 2009

           

          
            	
                    AGREED
      AND ACCEPTED:

                  	
                    AGREED
      AND ACCEPTED:

                  
	
                    “LESSOR”

                  	
                    “LESSEE”

                  
	
                    Fullerton
      Business Center, LLC

                  	
                    Allied
      Med, Inc., an Oregon Corporation

                  
	
                    a
      Delaware limited liability company,

                  	 
      
	
                    By
      The Ezralow Company, LLC, a

                  	 
      
	
                    Delaware
      limited liability company dba

                  	
                    /s/
      Jack Amin

                  
	
                    Mid
      Valley Management, its Managing

                  	
                    Name
      Printed:  Jack Amin

                  
	
                    Agent

                  	
                    Title:
      President

                  
	 
      	 
      
	
                    By:
      /s/ Terri Rhoades

                  	
                    By:
      /s/ Jack Amin

                  
	
                    Name
      Printed: Terri Rhoades

                  	
                    Name
      Printed:  Jack Amin

                  
	
                    Title:  Authorized
      Agent

                  	
                    Title:
      Vice President

                  


          

          


          


          Lmu
Addend 1 2005Ind Ls 2 28 06.Doc

          Page
1

          INITIALS:/s/

          Updated
7/8/2009


          

            
              
                 


              

              
                 


                
                  

                

              

              
                 


              

            


             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

            

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

             

            EXHIBIT
"C"

            MAINTENANCE AND TENANT
IMPROVEMENT PROCEDURES

             

            TENANTIMPROVEMENTS - HOW TO A VOID UNNECESSARY
EXPENSE:

             

            
              	
                       
      

                    	
                      ·

                    	
                      Do
      not paint the floor of your warehouse. Paint will have to be sandblasted
      off at your expense. A clear seal is acceptable if you require a finished
      surface.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      Wallpaper
      will have to be removed when you vacate the unit. The wall must be
      returned
      to us paint ready. If not, you will be charged for any expenses we incur
      to get the walls to this condition.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      Do
      not glue signs to the internal wood doors. We have to remove them when you
      leave and if the glue removes the finish and we cannot repair it, you will
      be charged to replace the door.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      Electrical
      installations done to code become the property of the landlord. If they
      are not done to code you will be charged for their removal. If you have
      any questions you should contact the leasing office before doing any
      removal.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      Do
      not attach anything to the marlite in the restroom. Any installations
      should be made above the marlite level. This is an expensive replacement
      and you will be charged for it. .

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      Do
      not make holes in the bronze moldings around the windows and doors to your
      unit, inside or outside. Alarm companies will frequently do this. The
      holes cannot be patched and therefore the bronze molding has to be
      replaced. This can cost upwards of $300.00. It is possible to do these
      installations without penetrating
      the bronze moldings.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      Glued
      down file or carpet on the warehouse floor has to be removed. The glue
      must also be removed. If you do not do this before vacating then we will
      do it and charge you. Sometimes the glue has to be sandblasted and this
      gets expensive.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      If
      you remove any of the handicap door handles in order to install door knobs
      with locking mechanisms, be sure to save the handicap hardware to
      reinstall when you leave. Otherwise, you will be charged for the purchase
      and reinstallation (NOT APPLICABLE TO FULLERTON BUSINESS
      CENTER).

                    


            

            


            The
Fullerton Fire Department requires storeroom doorknobs (always unlocked from the
inside) to be installed on the mandoor. If this doorknob is removed during your
occupancy and replaced with a deadbolt or other type hardware, you should save
the storeroom doorknob. Please be advised, however, that you will not only be
violating the fire code, but will be charged for the purchase and reinstallation
of the storeroom doorknob upon vacating the premises, if the original storeroom
doorknob is not reinstalled by you.

             

            
              	
                       
      

                    	
                      ·

                    	
                      Please
      note that you can be charged rent for the amount of time it takes to
      repair the damage to your unit when that damage is over and above normal
      wear and tear.

                    


            

            


            INSTRUCTIONS
FO R PROPER OPERATION OF YOUR AIR CONDITIONER:

            


            START UP: If your
unit does not operate when your power has been turned on, do the
following:

            
              	
                       
      

                    	
                      ·

                    	
                      Check
      all switches on the thermostat to see if they are in the correct
      position.

                    


            

            
              	
                       
      

                    	
                      ·

                    	
                      Make
      certain that your circuit breakers have not been turned
    off.

                    


            

            


            RULES FOR
OPERATION:

             

            
              	
                       
      

                    	
                      ·

                    	
                      When
      your unit shuts off, do not start it up again for five (5) minutes. This
      jiggling of the thermostat can cause a breaker inside the unit to shut off
      and it can damage the compressor.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      When
      the heat is in the on position never increase the thermostat more than two
      (2) degree increments. Changing the thermostat will not effect the
      temperature of the air that is coming
out.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      Always
      control your system from the thermostat. Do not turn it on and off from
      the breaker box. This could damage the
system.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      On
      very hot or very cold days do not set the temperature
      so that the unit will never shut off. Typical settings are 78 degrees for
      cooling and G8 degrees for heating. If the unit is set at an extreme
      temperature
      and is not shutting off, it will freeze up and require
    repair.

                    


            

            


            REGULAR
MAINTENACE PROCEDURES:

             

            
              	
                       
      

                    	
                      ·

                    	
                      The
      roll-up or tilt-up doors need to be serviced on a regular basis. The
      recommended maintenance interval is every six (6)
  months.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      Both
      the glass and the metal man doors need periodic servicing. Doors get out
      of alignment with repeated use and the locks collect dirt and become hard
      to use.

                    


            

             

            
              	
                       
      

                    	
                      ·

                    	
                      Tenants
      are responsible for cleaning their windows. If they are not cleaned on a
      regular basis they will buildup calcium deposit which will require acid
      washing to remove. This is an expensive procedure so please make
      arrangements to clean your windows regularly during your
      tenancy.

                    


            

            


            
              	
                                           LESSEE
      RECEIVED ON:

                    	
                      BY:

                    	
                       /s/
      Jack Amin

                    
	 
      	 
      	
                      Jack
      Amin, President

                    
	 
      	 
      	 
      
	
                       

                    	
                      BY:

                    	
                      /s/
      Jack Amin

                    
	 
      	 
      	
                      Jack
      Amin, Vice President

                    
	 
      	 
      	 
      


            

            PLEASE READ
CAREFULLY


            
              
                 


              

              
                 


                
                  

                

              

              
                 


              

            

            


            
              Tenant/Applicant:
Any parts of this Form that do not apply to you may be crossed out and
referenced NIA

               

              


            

            
              Term of
Lease (if prior tenant in existing space, include in length of term::Six (6)
Months

              Major products manufactured
and/or activities conducted on the
propeorty:  Storage

            

            


             

            Type of
Business Activity(ies): (check all that apply)

            q           machine
shop

            q           light
assembly

            q           research
and development

            q           product
service or repair

            q           photo
processing

            q           automotive
service and repair

            q           manufacturing

            q           warehouse

            q           integrated/printed
circuit

            q           chemical/pharmaceutical
product

            


             

            Hazardous
Materials Activities: (check all that apply)

            q           degreasing

            q           chemical/etching/milling

            q           wastewater
treatment

            q           painting

            q           striping

            q           cleaning

            q           printing

            q           analytical
lab

            q           plating

            q           chemical/missing/synthesis

            q           silkscreen

            q           lathe/mill
machining

            q           deionizer
water product

            q           photo
masking

            q           wave
solder

            q           metal
finishing

            q

            


             

            HAZARDOUS
MATERIALS/WASTE HANDLING AND STORAGE

            


            A.     Are
hazardous materials handled on any of your shipping and receiving docks in
container quantities greater than one gallon? Yes No

             

            B.     If
hazardous materials or waste are stored on the premises, please check off the
nature of the storage and type(s) of materials below:

             

            Types of
Storage Container Stored (list above-ground storage only) ❑1 gallon or 3
liter bottles/cans

            q           5
to 30 gallon carboys

            q           55 gallon drums

            q           tanks

             

            Type of
Hazardous Materials and/or Waste

             

            q           acid

            q           phenol

            q           caustic/alkaline
cleaner

            q           cyanide

            q           photo
resist stripper

            q           paint

            q           flammable
solvent

            q           gasoline/diesel/fuel

            q           nonflammable/chlorinated
solvent

            q           oil/cutting
fluid

            


             

            C. Do you
accumulate hazardous waste onsite? YesNo

             

            If yes,
how is it being handled?

            q           on-site
treatment or recovery

            q           discharged
to sewer

            q hauled offsite If
hauled offsite, by whom:

            q           incineration

             

            D.
Indicate your hazardous waste storage status with Department of Health
Services:

            q           generator

            q           interim
status facility

            q           permitted
TSDF

            q           none
of the above

             

            WASTEWATER
TREATMENT/DISCHARGE

            


            A. Do you
discharge industrial wastewater to:

            q           sewer

            q           storm
drain

            q           surface
water

            q           no
industrial discharge

             

            LMU
Exhibit D HazMat 7 06.doc Updated: 6/3/07

            EXHIBIT
"D"

          

        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    
       

      B.   Is
your industrial wastewater treated before discharge? Yes____ No
____

       

            If
yes, what type of treatment is being conducted?


      q     Neutralization

      q     Metal
hydroxide formation

      q     Closed-loop
treatment

      
         q Cyanide
destruct

      

      q     HF
treatment

      q     other


      SUBSURFACE
CONTAINMENT OF HAZARDOUS MATERIALS/WASTES

      


      A. Are
buried tanks/sumps being used for any of the following:

      


      q          hazardous
waste storage

      q          chemical
storage

      q          gasoline/diesel
fuel storage

      q          waste
treatment

      q          wastewater
neutralization

      q          industrial
wastewater treatment

      q          none
of the above

      


      B. If
buried tanks are located onsite, indicate their construction

      


      q          steel
❑ fiberglass
❑ concrete
❑ inside open
vault ❑
double walled

      


      C.     Are
hazardous materials or untreated industrial wastewater transported via buried
piping to tanks, process areas or treatment areas? Yes____ No ____

      


      D.     Do
you have wet floors in your process areas? Yes____ No ____

      


      If yes,
name processes:

       

      
        E. Are
abandoned underground tanks or sumps located on the property? Yes____ No
____

      

      
         

      

      
        	
                 
      

              	
                HAZARDOUS
      MATERIALS SPILLS

              


      

      


      A. Have
hazardous materials ever spilled to:

      


      q          the
sewer

      q          the
storm drain

      q          onto
the property

      q          no
spills have occurred

      


      B.     Have
you experienced any leaking underground tanks or sumps? Yes____ No
____

      C.     If
spills have occurred, were they reported? Yes____ No ____

      


      Check
which of the government agencies that you contacted regarding the
spill(s):

      q          Department
of Health Services

      q          Department
of Fish and Game

      q          Environmental
Protection Agency

      q          Regional
Water Quality Control Board

      q          Fire
Department

      


      D. Have
you been contacted by a government agency regarding soil or groundwater
contamination on your site? Yes____ No ____

      


      Do you
have any exploratory wells onsite? Yes____ No ____

      If yes,
indicate the following:

      


      Number of
wells ____ Approximate depth of wells:
____       Well diameters:
___________

      


      PLEASE ATTACH ENVIRONMENTAL
REGULATORY PERMITS,
AGENCY REPORTS THAT APPLY TO YOUR OPERATION AND HAZARDOUS WASTE
MANIFESTS.

      


      Check off
those enclosed:

      


      q           Hazardous
Materials Inventory Statement, HMIS

      q           Hazardous
Materials Management Plan, HMMP

      q           Department
of Health Services, Generatory Inspection Report

      q           Underground
Tank Registrations

      q           Industrial
Wastewater Discharge Permit

      q           Hazardous
Waste Manifest

       

      Signature:      /s/ Jack
Amin                  INITIALS

               Name Written: Jack
Amin

      Title: President & Vice
President      Phone: _________________       /s/

       

      EXHIBIT
D

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    REQUEST
FOR CERTIFICATE OF INSURANCE

     

    TENANT: FAX TO YOUR
INSURANCE CARRIER

    


    Dear
Tenant,

     

    Prior to the commencement
date, early possession date, or renewal of this lease we will need the following
from your insurance carrier: (All
insurance coverage
shall be written through insurance companies licensed or admitted to do business
in the State of California and must have a "BEST" Rating of at least A- VI):

    


    
      	
               
      

            	
              • A
      certified copy of the insurance binder (countersigned by the insurer); Or,
      Certificate of
      Insurance from your insurance carrier for each policy you are
      required to carry in compliance with the obligations under this
      Lease.

            


    

     

    ý GENERAL LIABILITY:
(Commercial General Liability Policy) on Insurance Services Office Form CG2010
or equivalent.

    Limits of
Liability: $1,000,000 per occurrence, with an annual aggregate of not less than
$2,000,000 Coverage shall be extended to include damage caused by heat, smoke or
fumes from a hostile fire.

    ý PROPERTY DAMAGE: (i.e.,
Fire, Flood, Vandalism, Fixtures, Tenant Improvements)

    Full
replacement cost coverage (Lessor requires written evidence insurance is in
force)

    
      	
               
      

            	
              ý BUSINESS
      INTERRUPTION INSURANCE: Loss of income and extra expense insurance
      attributable to all perils

            


    

    
      	
               
      

            	
              ❑
      ENVIRONMENTAL INSURANCE: Limits of Liability: A minimum of $1,000,000 per
      occurrence, with an annual aggregate of not less than
      $2,000,000

            


    

      ❑ LIQUOR
LEGAL LIABILITY COVERAGE: Coverage of not less than $1,000,000. Must remain
current at all times as long as alcoholic beverages are served on the
Premises.

    


    The
Certificate of Insurance, with an ADDITIONAL INSURED
ENDORSEMENT, must have the
following information: *THE ADDITIONAL INSURED ENDORSEMENT MUST NAME BOTH THE
LESSOR AND MID VALLEY MANAGEMENT.

     

    
      	
              Name
      of Lessee (Named Insured and DBA):

            	
              Jack Amin dba Allied
      Med, Inc., An Oregon Corporation

            
	
              Name
      Of Business Park:

            	
              Fullerton
      Business Center, LLC

            
	
              Address
      of insured Property Location:

            	
              2500
      E. Fender
      Avenue, Unit "H"

            
	
              City,
      State Zip:

            	
              Fullerton,
      CA 92831

            


    

    


     

    Fullerton
Business Center, LLC, a Delaware limited liability company 2478 E. Fender Ave.,
#A, Fullerton, CA 92831

     

    Please
have your carrier fax the Certificate of Insurance to (714) 447-9362, with
a hard copy to:

    


    Attention:
Karen Doss, Propeorty Manager Fullerton Business Center, LLC,

    2478 E.
Fender Ave., #A

    Fullerton,
CA 92831

    Phone:
(714) 447-0747

    


    Thank
you.  Your expedience in this matter is appreciated.

     

    Fullerton
Business Center

     

    
      	
              Mid
      Valley Management

            	
              Your
      signature below indicates receipt of this Insurance Request and that you
      have read and understand the insurance requirements in your
      lease

            


    

     

    


    
      	 
      	
              /s/ Jack
      Amin

            	
              /s/ Jack
      Amin

            
	 
      	
              LESSEE:  Jack
      Amin, President

            	
              Jack
      Amin, Vice President

            


    

    


    Allied
2488i Cert of Ins. Request.

    FORM

    Revised.
7/23/08


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    GENERAL
RULES & REGULATIONS FOR INDUSTRIAL LEASE

     

    KEYS

    1.           Lessee
shall return all keys, including mailbox keys, at the termination of its tenancy
and shall be responsible for the cost of replacing any keys that are lost and
for the cost to replace or re-key any locks that are altered.

    


    TENANT ALTERATIONS
AND LESSEE'S CONTRACTORS
SEE ITEM 7.3
(B) OF THE LEASE AGREEMENT

    2.           Lessee shall not employ any service or
contractor for services or work to be performed in the Premises except as
approved by Lessor. Prior to the commencement of any work, Lessee's contractor
must provide Lessor with a copy of their valid contractor's license and a
*Certificate of Insurance which, at Lessor's election, may require an additional
insured endorsement naming Lessor and Mid Valley Management as Additional
Insureds. The Limits of Liability on both General Liability and Worker's
Compensation must be a minimum of $1,000,000.00 each. FOR INSURANCE COMPANY REQUIREMENTS
SEE ITEM 8.5 OF
THE
LEASE
AGREEMENT.

    


    HEATING
AND AIR-CONDITIONING

    3.           Lessee
shall not use any method of heating or air-conditioning other than that supplied
or approved by Lessor.

    


    HEAVY
OBJECTS AND NOISE

    4.           
Lessee shall not place anything in or around the Premises, Building or Business
Complex that causes excessive vibration or floor loading. Business machines
and/or mechanical equipment belonging to Lessee which cause noise or vibration
that may be transmitted to the structure of the Building in which the Premises
are located, or to any space therein, to such a degree as to be objectionable,
to Lessor or to any Tenants in the Building, shall be placed and maintained by
Lessee, at Lessee's expense, on vibration eliminators or other devices
sufficient to eliminate noise or vibration.

    


    ROOF ACCESS SEE 7.3B
OF  THE  LEASE
AGREEMENT

    5.           In
addition to the information contained in Paragraph 7.3b of the Lease Agreement,
Lessee agrees to the following:

    5.1 If the Lessee, Lessee's Agents,
Contractors, Employees or invitees shall enter upon the roof of said Premises,
whether with or without the consent of Lessor, then the Lessee specifically
indemnifies and agrees to hold Lessor harmless from any and all claims, actions
or causes of action resulting from injuries incurred to any of said individuals
or any other Person or Property, caused by or as a result of their entering upon
the roof of said Premises.

    5.2 In the event that Lessor grants
written permission to the Lessee or any of the persons set-forth above to have
roof access, said consent shall be expressly on the condition that each time
said Lessee or those persons designated by Lessee to enter upon the roof that
they first execute a written Letter of Agreement provided by Lessor (a)
expressly indemnifying and holding Lessor free and harmless from any and all
damages caused by said individuals to the Leasehold Premises, (b) indemnifying
Lessor from any personal injury damages caused in connection
therewith,

    5.3 Lessee's Contractor shall provide
Lessor with Certificates of Insurance with an,additional
insured endorsement and in accordance with Paragraph 2., above.

    


    RIGHT TO CONTROL AND PREVENT
ACCESS

    6.           Neither
the Lessee, its Agents, employees, invitees or guests shall obstruct any
sidewalks, passages, exits, entrances or stairways of the Premises. The
passages, exits, entrances and stairways are not for the benefit of the general
public other than for access and egress; and Lessor shall in all cases retain
the right to control and prevent access thereto of all persons whose presence in
the judgment of Lessor would be prejudicial to or interfere with the general
welfare safety, character, reputation and interest of the Project and its
Tenants, provided that nothing contained herein shall be construed to prevent
such access to persons with whom any Tenant normally deals in the ordinary
course of its business (unless such persons are engaged in acts adverse to the
Project and its Tenants, and/or illegal activities).

    


    DELIVERIES

    7.           Furniture,
significant freight and equipment shall be moved into or out of the building
only with Lessor's knowledge and consent and subject to such reasonable
limitations, techniques and timing, as may be designated by Lessor. Lessee shall
be responsible for any damage to the Office Building Project arising from any
such activity.

    


    WORK
AREAS

    8.           All
work must be confined within the Leased Premises.

    


    PROTECTION
OF PREMISES

    9.           Lessee
assumes any and all responsibility for protecting its Premises from theft,
robbery, vandalism and pilferage, which includes keeping doors locked and other
means of entry to the Premises closed. Lessor strongly suggests that Lessee
re-key the suite upon taking possession, which cost is at Lessee's sole cost and
expense

    


    LESSEE'S
ALARM SYSTEM

    10.           If
Lessee desires to install an alarm system, all equipment must be installed
inside Lessee's unit so as not to be visible and shall otherwise comply to the
standards set by Lessor for all alarm systems contained in the Business Complex.
Lessor must approve all alarm systems. When equipment is removed, Lessee must
restore the Premises to its original condition. Only one alarm sticker per unit
placed on Lessee's door is permitted.

     

    RUBBISH REMOVAL

    11.           No rubbish, containers or
debris are to be left outside of Lessee's unit. Lessee shall store all
its trash and garbage within the interior of the Premises. No material shall be
placed in the trash receptacles if such material is of such nature that it may
not be disposed of in the ordinary and customary manner of removing and
disposing of trash in the vicinity of the Project without violation of any law
or ordinance governing such disposal. If Lessor shall determine that the trash
generated by or at

    


     

    Updated
11/9/2009

     

    General
Rules and Regulations

    Parking
Rules and Regulations

    Industrial
Lease

    LMU Rules
Regs Ind
4.06.doc                                                                                                                       INITIALS /s/

    Page 1 of
3


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Lessee
agrees to comply with all laws or ordinances regarding disposal of items
considered hazardous waste (Title 22,

    the
Premises, in Lessor's reasonable estimation, shall be excessive, Lessee shall
pay to Lessor, upon demand, such additional charges as Lessor shall equitably
impose for such excess trash removal.

    In
addition to any other rights and remedies available to Lessor, any Lessee, their
employees, vendors, or invitees, who are division 4.5 chapter 11., section
66261.50) which includes, but is not limited to Fluorescent tubes, compact
fluorescents and High Intensity Discharge Lamps (See "Fluorescent Lights
disposal 02.22.06").

    known to
be improperly disposing of any materials, are subject to a violation fee, in
addition to any fine imposed upon Lessor for Lessee's actions in regards to
improper disposal.

     

    EXTERIOR DAMAGE BY LESSEE

    12.           During
the Lease Term, and at expiration (or early termination) of this Lease, if
Lessee dirties, soils or damages the
exterior of Lessor's Business Complex, Lessee will be responsible for the repair
of this damage.

    


    SIGNAGE

    13.           Lessee
shall not place or permit to be placed any projecting sign, marquee, decoration
or awning on said Premises without the written consent of Lessor. All signs
which are permitted shall be conforming to the signage criteria established from
time to time by Lessor for the Premises, Building and the Business Complex, as
applicable, and shall be maintained by Lessee at its sole expense, including,
but not limited to sign fabrication, maintenance, operation (including any
required utilities), repair and removal. Lessee, upon the request of Lessor,
shall immediately remove any sign or decoration which Lessee has placed, or
permitted to be placed in, on or about the Premises of which, in the sole option
and discretion of Lessor, is objectionable or offensive; and if Lessee fails to
do so, Lessor may enter upon said Premises and remove said item and charge the
cost thereof to Lessee. Lessee shall not place or permit to be placed upon any
side wall, rear wall, window or roof; any sign, advertisement or notice without
the written consent of Lessor, which consent shall only be given where the
proposed sign, advertisement or notice complies with the specifications of size,
shape, design, color or material established by Lessor and which are applicable
to all Tenants of Lessor's Business Complex and contained in Tenant's
Information packet.

     

    DIRECTORY

    14.           Any
directory of the Project will be provided exclusively for the display of the
names and locations of Tenants only.
Lessor reserves the right to exclude any other names on said directory.
Directory signage is the sole cost of Lessee.

     

    WINDOWS,
WINDOW COVERINGS and
WINDOW TINTING

    15.           Lessee
shall not place upon the Leased Premises any window coverings (e.g. curtains,
draperies, blinds, etc.), nor tint
windows, without Lessor's written consent.

     

    CANVASSING
AND SOLICITATION

    16.           Canvassing,
soliciting and distribution of handbills or other written material and peddling
in the Project is prohibited; each Tenant shall cooperate to prevent
same.

    


    FOUL,
NOXIOUS GAS
OR SUBSTANCE

    17.           Lessee
shall not use, keep, or permit to be used or kept, any foul or noxious gas or
substance in or on the Premises; or permit or allow the Premises to be occupied
or used in a manner which by reason of any odor is offensive or objectionable to
Lessor, in its sole and exclusive judgment, or to other tenants or occupants of
the Building.

     

    ANIMALS

    18.           Lessee
shall not bring into or keep in or about the Premises any birds or animals
(except service animals for the disabled).

    


    UNDER THE
INFLUENCE

    19.           Lessor
reserves the right to exclude or expel from the Premises any person who, in
Lessor's judgment, is intoxicated or under the influence of liquor, drugs or
other abusive substances, or who is otherwise in violation of any Rules and
Regulations of the Project.

     

    CHANGES
IN RULES AND
REGULATIONS

    20.           Lessor
reserves the right by written notice to Lessee to rescind, alter or waive any
Rule or Regulation prescribed for Lessor's Business Complex at any time when, in
Lessor's judgment, it is necessary, desirable, proper and in the best interest
of Lessor's Business Complex and its Tenants. Lessee agrees to be bound by any
changes, revisions or modifications.

     

    WAIVER OF
RULES
AND REGULATIONS:

    21.           Lessor,
in its sole discretion reserves the right to waive any one of these rules or
regulations, and/or as to any particular Lessee, and any such waiver shall not
constitute a waiver of any other rule or regulation or any subsequent
application thereof to such Lessee. Lessor will have no liability if other
Complex tenants or guests fail to comply with rules or regulations, applicable
law, or that party's lease.

     

    ALTERNATIVE
TELEPHONE OR TELECOMMUNICATIONS
PROVIDER:

    22.           A.      Lessor
Consent Required. In the event that Lessee wishes to utilize the services of a
telephone or telecommunications provider whose equipment is not servicing the
Building as of the date of Lessee's execution of this Lease ("Provider"), no
such Provider shall be permitted to install its lines or other equipment within
the Building without first securing the prior written consent of Lessor, which
consent shall not be unreasonably withheld. At Lessor's discretion, Lessee may
be presented with a Letter of Agreement outlining the Conditions of Consent
prior to work being done and any additional requirements of Lessor.

    B.      Defacement of Premises: Lessor shall have the
right to approve where and how telephone wires are to be introduced to the
Premises. No boring or cutting for wires shall be allowed without the consent of
Lessor. The location of telephone call boxes and other office equipment affixed
to the Premises shall be subject to the approval of Lessor. Lessee shall not
mark, drive nails or screws, or drill into the partitions, woodwork or plaster
contained in the Premises or in any way deface the Premises or any part thereof
without Lessor's prior written consent Lessee shall not install any radio or
television antenna, satellite dish, loudspeaker or other device on the roof or
exterior walls of the Project. Lessee shall not interfere with broadcasting or
reception from or in the Project or elsewhere.

    Updated
7/9/2009

     

    General
Rules and Regulations

    Parking
Rules and Regulations

    Industrial
Lease

    LMU Rules
Regs Ind
4.06.doc                                                                                                                                              INITIALS /s/

    Page 2 of
3


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    C.      The
replacement or repair to Lessor's Business Complex, including but not limited
to, ceiling tiles, damaged T-bar or existing wiring during Lessee's installation
of phone or computer cabling ,shall be borne by Lessee.

     

    UTILITIES
AND SERVICES

    23.           No
cooking shall be done or permitted on the Premises. Notwithstanding the
foregoing, Underwriter's Laboratory approved equipment and microwave ovens may
be used in the Premises for heating food and brewing coffee, tea and similar
beverages for employees and visitors of Lessee, provided that such use is in
accordance with all applicable federal, state and city laws, codes, ordinances,
rules and regulations; and provided further that such cooking does not result in
odors escaping from the Premises.

    


    SMOKING                                   -°

    24.           Lessee
shall not suffer or permit smoking or carrying of lighted cigars or cigarettes
in areas reasonably designated by Lessor or by applicable governmental agencies
as non-smoking areas.

     

    VENDING
MACHINES

    25.           Lessee
shall not install, maintain or operate any vending machines upon the Premises
without Lessor's written consent.

    


    SAFETY
and COMPLIANCE

    26.           Lessee
shall comply with all safety, fire protection and evacuation regulations
established by Lessor or any applicable governmental agency.

     

    PARKING
RULES and REGULATIONS

    


    PERMITTED
AND PROHIBITED PARKING

    1.           Parking
is permitted in designated striped areas only. All other Vehicles not parked in
such areas are subject to being towed away at Lessee's sole cost and expense
(22658 CVC). Parking is prohibited:

    (a)      in
areas not striped for parking;

    (b)      in
aisles

    (c)      where
"No Parking" signs are posted;

    (d)      where
"Handicap" signs are posted, unless Handicap I.D. is posted in or on
vehicle;

    (e)      on
ramps;

    (f)      in
areas outside warehouse doors which are restricted to loading and unloading
only. This is a fire lane, which must not be blocked.

    (g)      in
specifically assigned and reserved spaces to others than Lessee;

    (h)      inside
the Premises; and,

    (i)      in
such other areas as may be designated by Lessor, its Agents, Lessee or
Licensee.

    


    OVERNIGHT
STORAGE OF
VEHICLES
OR TRAILERS

    2.           There
will be no overnight storage of Vehicles or Trailers in the parking lot.
Vehicles used and moved on a daily
basis are exempt. There will be no storage of wrecked or damaged Vehicles
at any time.

    


    DIRECTIONAL
SIGNS AND
ARROWS

    3.           All
directional signs and arrows must be observed.

    


    SPEED LIMIT

    4.           The
speed limit will be a reasonable speed.

    


    RESPONSIBILITY FOR LOCKED VEHICLES
AND DAMAGES

    5.           Unless
otherwise instructed, every person is requested to park and lock his/her own
Vehicle. All responsibility for damage to Vehicles to be repaired is assumed by
Authorized Users. Lessee shall repair or cause to be repaired at its sole cost
and expense any and all damage to the Project Parking Facility or any part
thereof caused by Lessee, its Authorized Users, Invitees or Guests, or resulting
from Vehicles of each of them. Lessee specifically waives any claims against
Lessor arising out of damage to said Vehicles.

    


    COMMON
AREA PARKING

    6.           Lessee
acknowledges that the parking spaces as specified on Page 1., Paragraph 1.2(b)
of the Lease will not necessarily be located in close proximity to Lessee's
Premises or each other, if more than one space is involved. Lessee agrees not to
overburden the parking facilities and agrees to cooperate with Lessor and other
Tenants in the use of parking facilities. At no time may Lessee's number of
parking spaces exceed the number referenced in Paragraph 1.2(b) of the Lease
Agreement. Lessor reserves the right in its absolute discretion to determine
whether parking facilities are becoming crowded, and in such an event, to
allocate parking spaces among Lessee and other Tenants. In the event allocation
is deemed necessary by Lessor, Lessee shall be entitled to the use of up to two
(2) parking spaces per 1,000 square feet leased. Lessee hereby agrees not to
occupy or permit its Employees, Customers or Invitees to occupy more than the
number of spaces specified above; nor to park anywhere other than in parking
stalls assigned and designated as such by painted signs, parking lines and
parking bumpers.

    


    PROHIBITED
USE

    7.           The
maintenance, washing, waxing or cleaning of vehicles in the Common Areas is
prohibited. Parking a vehicle that is leaking fluids (i.e., motor oil; coolant,
etc.) onto the asphalt is prohibited. Owner of vehicle will be required to
remove said vehicle from the lot until the problem is repaired. Lessee shall be
responsible for the cost to repair any damages to Lessor's parking lot caused by
said vehicle.

    


    CHANGES
TO RULES and
REGULATIONS

    8.           Lessor
reserves the right to modify these rules and/or adopt such other reasonable and
non-discriminatory rules and regulations as it may deem necessary for the proper
operation of the parking area.

    Updated
7/9/2009

     

    General
Rules and Regulations

    Parking
Rules and Regulations

    Industrial
Lease

    LMU Rules
Regs Ind
4.06.doc                                                                                                                                                                                                                         
         INITIALS /s/

    Page 3 of
3

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    MID
VALLEY MANAGEMENT

     

    UNIT
INSPECTION CHECK LIST

     

    PROPERTY:  FULLERTON
BUSINESS
CENTER                                                                                                           MOVE
IN DATE:  12/01/09

    TENANT:  Allied
Med, Inc., an Oregon Corporation

    ADDRESS:  2488
E. Fender Ave., Fullerton, CA
92831                                                                                                 UNIT
NUMBERS:  “I”

    LESSEE
INSPECTION DATE:  N/A

    


    Please
indicate the condition of your unit for the categories listed below, then sign
and return this form within thirty (30) days of your Lease commencement date, or
occupancy, whichever occurs first. Unless otherwise specified in your Lease,
Lessor will have no obligation to make repairs; this checklist will be a
benchmark documenting the status of the Premises when you took possession. If
you fail to complete and return this Unit Inspection Checklist, the Unit will be
deemed in good condition and repair.

    
      	 


    

    Please
provide the phone number for your new unit:

     

    

    
 

    
      	
               
      

            	
              Accepted
      as indicated above: 

              LESSEE:  Allied
      Med, Inc., 

              an
      Oregon Corporation

            


    

    


     

           By:  /s/
Jack Amin, President  Date:  11/10/09

     

           By:  /s/
Jack Amin, Vice President  Date:  11/10/09

     

    


     

                    LESSEE: IF TAKING
UNIT AS IS, INITIAL HERE

     

                    LESSEE RECEIVED THIS
BLANK FORM ON 11/11/09 BY /s/

     

     

    

      LMU Unit
Inspection Check List.doc.5.1.06

      Updated
11/9/2009


    

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    CONNELLY ACT
NOTICE

    (Revised
3/12/90)

     

    The
Connelly Act (California Health & Safety Code section 25915 at seq.) (the "Act")
requires that certain informa­tion pertaining to asbestos be made available
to employees, contractors, tenants, and others. We are providing you with this
notice regarding the Fullerton Business Center, Fullerton, California (the
"Center") in compliance with this law.

    


    Reports By Diagnostic
Engineering, Inc. A limited
asbestos survey report (revision) ("Report") dated January 12, 1990, was
prepared by Diagnostic Engineering, Inc. ("DEI"). This Report contains the
results of a limited asbestos survey for asbestos-containing construction
materials ("ACM"). The survey included visual observation of all office spaces
at the Center for. spray-applied acoustic material, sampling of suspect acoustic
ceiling materials, and laboratory analysis of the 25 bulk samples
taken.

    


    The
contents of the report include a statement of con­clusions, a warning
regarding ACM, a list of the friable mater­ials encountered in sample
locations, a list of unsampled suspect materials and their general locations, a
statement of sampling and laboratory procedures, and a work item inventory
regarding future removal of the ceiling material.

    


    Laboratory
results of the bulk sampling indicated that one of the bulk samples, taken from
2478-K, did not contain asbestos. The other 24 samples of the spray-applied
acoustic material collected were found to contain asbestos. These 24 samples
were taken from the following office ceiling locations:

     

    
      	 
      	
              2434-A,

            	
              2434-B,

            	
              2444-J,

            	
              2444-F,

            	
              2478-A,                   2478-C,                        2488-K,

            
	
              2488-I,

            	
              2500-B,

            	
              2500-D,

            	
              2512-A,

            	
              2512-D,

            	
              2524-C,                  2524-G,                          2536-I,

            
	
              2536-L,

            	
              2548-J,

            	
              2560-F,

            	
              2572-A,

            	
              2584-H,

            	
              2444-L,                      and
      2560-C.

            


    

     

    Analysis
of the bulk samples for asbestos content was performed by polarized light
microscopy (PLM), according to EPA protocols.

    


    All of
the positive bulk samples indicated that the spray-applied acoustic material is
friable. Damage ranged from none to minor, air movement was found to be
moderate, and access to all of the positive sampled material was found to be
high.

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    The
Report concludes that friable ACM is present in the following ceiling
locations:

    


         .   2434-A-I,
2444-A-L, 2478-A-K, 2488-A-K, 2500-A-L, . 2512-A-L, 2524-A-L, 2536-A-L,
2548-A-J, 2560-A-J, 2572-A-1, and 2584-A-H.

    


    The
report also noted that other building materials which may contain asbestos were
not sampled or could not be representatively sampled as part of the survey.
These include roofing materials, resilient sheet flooring and mastic, resilient
floor tile and mastic, baseboard and mastic, joint compound, and wallboard.
These materials and others which may be discovered should be assumed to contain
asbestos until confirmed otherwise.

    


    Previously,
DEI performed. cohesion/adhesion testing of bulk samples of spray-applied
acoustic ceiling material from 2488-K, 2512-L, 2584-E, and 2478-E. The
cohesion/adhesion testing results indicated that the spray-applied acoustic
mater­ial sampled is well-secured to the underlying substrate.

    


    Air
samples were taken by DEI in the following twelve locations:

     

    
      	 
      	
              2478-A,

            	
              2488-K

            	
              2434-H,                  2444-D,2500-A,

            	
              2512-J,

            	
              2524-A,

            
	
              2560-A,

            	
              2548-J,

            	
              2527-J

            	
              2584-H,                      2536-K

            	 
      	 
      
	 
      


    

    The air samples were analyzed by phase
contrast mico-scopy (PCM), using EPA protocols. This technology measures all
fibers, not just asbestos fibers. The fiber content of the air in each instance
of sampling was below the OSHA "action level" of 0.1 f/cc.

    


    The
cohesion/adhesion testing results and air sampling results are contained in a
prior DEI report, dated October 31, 1989. This report also contains an executive
summary, findings and recommendations, a statement of limitations, an air sample
log, a bulk sample log and a cohesion/adhesion test log.

    


    DEI also
issued a Limited Site Review report, dated February 28, 1990, which contains
observations and recommenda­tions by DEI regarding spray-applied acoustic
ceiling materials in locations 2478-I, 2478-K, 2444-L, 2560-F, 2488-I, and
2548-J. This report states that varying amounts of damage to the material was
observed in 2478-I, 2444-L, 2560-F, 2488-I, and 2548-J. No observation was made
by DEI of 2488-K, but there appears to be damage to the material in that unit.
The material in 2478-K was observed to be in good condition.

     

    -2-


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    DEI has
recommended removal of the ceiling material in 2560-F, 2488-K and 2548-J. For
2478-I and 2478-K, DEI has recommended reinspection of the material as part of
an operations & maintenance ("O&M") program. For 2444-L and 2488-I, DEI
has recommended removal of the material if the source of water damage to the
material cannot be repaired; if it can be repaired, DEI has recommended
reinspection of this material as part of an O&M program. Material which is
removed will be replaced with a non-ACM product. Until this removal and
replacement work is com­pleted, great care must be taken to prevent any
disturbance of the material which could result in airborne fiber release and
contamination of the occupied space. Center management is working with its
consultant to determine the best means of performing this work.

     

    DEI has
reviewed the report by M.R. Chasse' Company, dated August 7, 1989, which
recommended abatement (by removal or encapsulation) of all of the spray-applied
acoustical ceiling material. The Chasse' Report is discussed below. Based upon
its observation of the material in place and the results of the testing
concluded to date, DEI does not believe that encapsulation of the spray-applied
acoustical material is an appropriate strategy and does not believe that removal
of the material is necessary at this time, except as noted above. Accordingly,
DEI has recommended an operations and maintenance ("O&M") plan for
management for the remaining ceiling materials, with a long term goal of
removal.

     

    Report By M.R. Chasse' Company. A property
inspection report ("Chasse' Report"), dated August 7, 1989, was prepared by M.
R. Chasse' Company. The Chasse' Report contains the results of an inspection to
survey the buildings at the Center for the presence of ACM. The contents of the
report include a general statement of the scope of services performed, findings
regarding ACM in the Center, and a laboratory report regarding analysis of the
bulk samples taken in the Center.

    


    Bulk
samples of sprayed-on acoustic ceiling material were analyzed from material
taken from 2584-E (south and north offices); 2584 (south and north offices);
2560 (Units D and J and south office); 2536 (Unit B); 2524-C (south and north
offices), 2524-H; 2512-G (south and north offices); 2512-I; and
2444-H.

    Roof
covering material was analyzed from samples taken from 2584, 2572, 2560, 2478,
2500, 2488, 2512, 2524, 2536, 2434, 2444 and 2548 East Fender. Asbestos was not
detected in any of these samples. However, the analytical detection limit for
the tests by Chasse' was 1% asbestos (which is consistent with generally
approved bulk sample testing methods under EPA protocols), whereas the Connelly
Act defines ACM to mean material with greater than 1/10 of 1% asbestos by
weight. Although asbestos at, a level of 1% or more was not detected in these
samples, it is possible that the sampled roof materials may contain asbestos at
a level greater than 1/10 of 1% but less than 1%. A flooring sample from 2584-G
also was analyzed and found to contain greater than 1% asbestos.

     

    -3-


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    The
sampled acoustic ceiling material was found to be friable and contains asbestos
in a concentration sufficient to be considered a hazard to health if disturbed.
However, the mater­ial was found to be in good condition.. The sampled vinyl
asbestos flooring was characterized by Chasse' as non-friable, as was the
transite pipe; generally, these- materials do not present a hazard unless they
are disturbed.

    


    The mere
presence of undisturbed and non-friable ACM in a building does not generally
present a health hazard. However, exposure to airborne asbestos fibers can cause
asbestosis and other asbestos-related diseases. Asbestos is listed under
Proposition 65 as a chemical known to the State of California to cause cancer.
There are uncertainties about the level of expos­ure which can cause
disease. The owners have no special knowl­edge of the potential health
impacts resulting from exposure to asbestos. If you wish to obtain further
information regarding potential health risks or impacts of asbestos, you are
encouraged to contact your local or state public health agencies.

    


    Asbestos
is a hazardous material. When it is contained in ceiling material, roofing
material, floor coverings or piping insulation, it can release fibers, if
disturbed. Certain general procedures and handling restrictions are necessary
when dealing with ACM or potential ACM, as a result. It is important that these
materials not
be touched, moved, painted, scraped, cut, drilled, ordered, sanded, cored,
broken or otherwise disturbed in order to prevent and minimize potential release
of asbestos fibers. The material should not be penetrated for
hangers, cabling, wiring and the like. Such activities may present a health risk
and should not be attempted by any person who is not trained in the proper
handling and disposal of ACM. Any damage to, or disturbance of, these materials
should be reported immediately to the on-site manager.

    


    The
reports referred to in this Notice are available for your review and
photocopying in the on-site management office at 2478 East Fender, Suite A,
Fullerton, California 92631. Please call Stephanie Burke at (714) 447-0747 if
you wish to arrange access to this information. Center management will keep you
informed of progress in the on-going planning with regard to the
ACM.

    


    -4-


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    

      GUARANTY
OF LEASE

       

      WHEREAS,
Fullerton Business Center LLC, a Delaware limited liability company, hereinafter
referred to
as "Lessor", and Allied Med. Inc, an Oregon
Corporation, hereinafter referred to as "Lessee", are about to execute a
document entitled Standard Industrial/Commercial Multi-tenant Lease - Gross,
dated November 9,
2009 concerning the premises commonly known as 2488 E. Fender Avenue, Unit "I",
Fullerton, CA 92831, wherein Lessor will lease the premises to Lessee
and

      


      WHEREAS,
Jack Amin, an
Individual, hereinafter referred to as "Guarantor" has a financial
interest in Lessee, and WHEREAS, Lessor would not execute the Lease if Guarantor
did not execute and deliver to Lessor this Guarantee of Lease.

       

      NOW
THEREFORE, for and in consideration of the execution of the foregoing Lease by
Lessor and as a material inducement to Lessor to execute said Lease. Guarantor
hereby jointly, severally, unconditionally and irrevocably guarantee the prompt
payment by Lessee of all rentals 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 and understood that the terms of the foregoing Lease may be
altered, affected, modified or changed 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 Guarantor and that this Guaranty
shall thereupon and thereafter guarantee the performance of said Lease as so
changed, modified, altered or assigned.

      


      This
Guaranty shall not be released, modified or affected by 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 Guarantor, it being specifically agreed and
understood that the guarantee of the undersigned is a continuing guarantee under
which Lessor may proceed forthwith and immediately against Lessee or against
Guarantor following any breach or default by Lessee or for the enforcement of
any rights which Lessor may have as against Lessee pursuant to or under the
terms of the within Lease or at law or in equity.

       

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

      


      Guarantor
hereby waive (a) notice of acceptance of this Guaranty. (b) demand of payment,
presentation and protest, m all right to assert or plead any statute of
limitations as to. or relating to this Guaranty and 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 Guarantor, (g) any right of
subrogation.

       

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

      


      Any
married woman who signs this Guaranty expressly agrees that recourse may be had
against her separate property for all of her 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 Guarantor hereunder to do and provide the same relative to
Guarantor.

      


      The term
"Lessor" whenever hereinabove used refers to and means the Lessor in the
foregoing Lease specifically named and also any assignee of said Lessor, whether
by outright assignment or by assignment for security, and also any successor to
the interest of said Lessor or of any assignee in such Lease or any part
thereof, whether by assignment or otherwise, So long as the Lessor's interest in
or to the leased premises or the rents, issues and profits therefrom, or in, to
or under said Lease, are subject to any mortgage or deed of trust or assignment
for security, no acquisition by Guarantor of the Lessor's interest in the leased
premises or under said lease shall affect the continuing obligation of Guarantor
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, of any purchase at sale by judicial
foreclosure or under private power of sale, and of the successors and assigns of
any such mortgagee, beneficiary, trustee, assignee or purchaser.

      


      The term
"Lessee" whenever hereinabove used refers to and means the Lessee in the
foregoing Lease specifically named and also any assignee or sublessee of said
Lease and also any successor to the interests of said Lessee, assignee or
sublessee of such Lease or any part hereof, whether by assignment, sublease or
otherwise.

       

      The undersigned's' total
monetary liability under this Guaranty shall be for an amount not to
exceed
$5,544.00.

       

      In the
event any action be brought by said Lessor against Guarantor hereunder to
enforce the obligation of Guarantor 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.

      
        	
                EXECUTED
      AT:

              	 
      	 
      
	 
      	 
      	 
      
	
                ADDRESS:________________________________________

              	
                By:

              	
                /s/    Jack
      Amin

              
	 
      	 
      	
                Jack
      Amin, President

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                EXECUTED
      AT:

              	
                By

              	
                        /s/    Jack
      Amin    

              
	 
      	 
      	
                Jack
      Amin, President

              
	
                ADDRESS:

              	 
      	 
      


      


      
        
           


        

        
           


          
            

          

        

        
           


        

      



    CERTIFIED CORPORATE
RESOLUTION

     

    I, THE UNDERSIGNED, Jack
Amin,
hereby certify that I am, and at all times mentioned herein, have been the duly
elected and acting CEO of Allied
Med,
Inc., an Oregon
Corporation,
and that at a meeting of the Board of Directors of said corporation duly
noticed and held on, the following Resolution was adopted.
[Date]

     

    "RESOLVED, that this
Corporation Lease from Fullerton
Business Center, LLC,
a
Delaware limited
liability company the commercial real
property commonly described as: 2488 E.
Fender Ave., suite number(s) #
I
City of Fullerton,
County of Orange, CA, upon all of the terms
and conditions contained in Landlord's Standard Lease Form with such Amendments
and supplements thereto as from time-to-time may be agreed upon by this
Corporation; and,

     

    RESOLVED
FURTHER that any TWO
of the following Officers of this corporation be,

    


    
      	
              (1)____________________

            	
              __________________________

            
	
                   Printed
      Name:  Jack Amin

            	
              TITLE:  President

            
	 
      	 
      
	
              (2)____________________

            	
              __________________________

            
	
                   Printed
      Name:  Jack Amin

            	
              TITLE:  President

            
	 
      	 
      


    

     

    and they
hereby are authorized and directed to execute and deliver in the name of and on
behalf of this corporation such Lease Agreements and such other documents and
instruments related or incidental thereto, including but not limited to,
renewals and amendments as such Officers deem necessary in its full discretion
in order to carry out the intent of this Resolution."

    


    I HEREBY
CERTIFY AND WARRANT that this Resolution has not been modified or amended
and is in full force and effect as of the date hereof.

     

    IN WITNESS WHEREOF, I have
executed this Certificate on this 9th day of November, 2009.

     

    (PLACE CORPORATE SEAL HERE)

    


    
      	 
      	
              By:

            	
              /s/ Jack
      Amin

            
	
               

            	 
      	
              President:  Jack
      Amin

            


    

     

    Allied
24881 - Corp Resolution (Legal).doc Updated 7.11.06