exv10w2






Exhibit 10.2




STANDARD INDUSTRIAL LEASE

(NET)





	1.	 	BASIC LEASE TERMS.






	 	(a)	 	DATE OF LEASE EXECUTION: August 7, 2009
	 
	 	(b)	 	TENANT: DENDREON CORPORATION, a Delaware corporation
	 
	 	 	 	Trade Name: Dendreon
	 
	 	 	 	Address (Premises): 1700 Saturn Way, Building #5, Seal Beach, California 90740





	 	 	 	 	 
	 

	 	Address for Notices:
	 	3005 First Avenue
	 

	 	 	 	Seattle, Washington 98121
	 

	 	 	 	Attention: Rick Hamm, General Counsel
	 

	 	 	 	Telephone: (206) 256-4545
	 

	 	 	 	Fax: (206) 256-0571







	 	(c)	 	LANDLORD: KNICKERBOCKER PROPERTIES, Inc. XLVI, a Delaware corporation





	 	 	 	 	 
	 

	 	Address for Rent:
	 	c/o Overton Moore Properties
	 

	 	 	 	19300 S Hamilton, Suite 200
	 

	 	 	 	Gardena, CA 90248
	 

	 	 	 	Attn: Pacific Gateway Business Center Property Manager






	 	 	 	 	 
	 

	 	Address for Notices:
	 	c/o Overton Moore Properties
	 

	 	 	 	19300 S. Hamilton Avenue, Suite 200
	 

	 	 	 	Gardena, CA 90248
	 

	 	 	 	Attn: Pacific Gateway Business Center Property Manager
	 
	 	 	 	 
	 

	 	 	 	with a copy to:
	 
	 	 	 	 
	 

	 	 	 	c/o JP Morgan Asset Management
	 

	 	 	 	1999 Avenue of the Stars, Floor 26
	 

	 	 	 	Los Angeles, CA 90067
	 

	 	 	 	Attn: Mr. Steven M. Zaun
	 
	 	 	 	 
	 

	 	 	 	and
	 
	 	 	 	 
	 

	 	 	 	Allen Matkins Leck Gamble Mallory & Natsis LLP
	 

	 	 	 	515 South Figueroa Street, 9th Floor
	 

	 	 	 	Los Angeles, CA 90071
	 

	 	 	 	Attn: Thomas J. Masenga, Esq.






     (d) TENANT’S PERMITTED USE OF PREMISES: (i) Processing human cells, developing antibodies,
treating human blood and manufacturing therapeutic drugs, as well as any uses ancillary to the
foregoing (including, without limitation, ancillary office, warehouse and manufacturing uses)
(collectively, the “Specific Use”) and (ii) any other legally permissible use so long as the same
is (A) not in violation of the Project CC&Rs (defined hereinbelow), (B) not more hazardous or
dangerous than the Specific Use described above, and (C) subject to the provisions set forth in
this Lease and as permitted by law (clauses (i) and (ii) above may be collectively referred to
herein as the “Permitted Use”).



     (e) PREMISES; BUILDING; PROJECT: Approximately 184,000 square feet of space (the “Premises”)
comprising the entire building commonly known as 1700 Saturn Way, Building #5, Seal Beach,
California 90740, as shown on Exhibit A attached hereto (the “Building”). The Building is part of
the project commonly known as Pacific Gateway Business Center (the “Project”).



          TENANT’S SHARE OF THE BUILDING: 100%, which is the ratio that the square footage of the
Premises bears to the square footage of the Building.




          BUILDING’S SHARE OF THE PROJECT: 22.151%, which is the ratio that the square footage of the
Building bears to the square footage of the Project.




     (f) PREMISES LAND: Approximately 402,429 square feet (approximately 9.238 acres) of land on
which the Building is located more particularly described on Exhibit B attached hereto.




	 	(g)	 	TERM; COMMENCEMENT DATE; RENT COMMENCEMENT DATE; EXPIRATION DATE:

	 
	 	 	 	Term: Approximately One Hundred Twenty-Five (125) months, subject to extension as
set forth in Rider 1 attached hereto.

	 
	 	 	 	Commencement Date: Upon mutual execution of this Lease.




 









 






	 	 	 	Rent Commencement Date: January 1, 2010.

	 
	 	 	 	Expiration Date: December 31, 2019.





     (h) BASIC RENT:



	 	 	 	 	 
	Period	 	Basic Rent Per Month
	Commencement Date – Rent Commencement Date

	 	$	0.00	 
	1/1/10 – 6/30/12

	 	$	101,200.00	 
	7/1/12 – 12/31/14

	 	$	108,973.52	 
	1/1/15 – 6/30/17

	 	$	117,344.15	 
	7/1/17 – 12/31/19

	 	$	126,357.75	 






     (i) PREPAID RENT (Basic Rent and estimated additional rent for January, 2010): One Hundred
Thirty-Eight Thousand Nine Hundred Sixty-One and No/100 Dollars ($138,961.00).



     (j) LETTER OF CREDIT AMOUNT: Two Million One Hundred Thousand and No/100 Dollars
($2,100,000.00), which amount is subject to reduction as further specified herein.



     (k) BROKER(S): CB Richard Ellis, representing Landlord; Jones Lang LaSalle, representing
Tenant.



     (l) INTENTIONALLY OMITTED.



     (m) ALLOWANCE: Two and No/100 Dollars ($2.00) per square foot of the Premises, i.e., Three
Hundred Sixty-Eight Thousand and No/100 Dollars ($368,000.00).



     (n) RIDERS: Rider 1 and Rider 2 are attached hereto and made a part hereof.



     (o) EXHIBITS: Exhibits lettered A through K, inclusive, are attached hereto and made a part
hereof.


This Paragraph 1 represents a summary of the basic terms of this Lease. In the event of any
inconsistency between the terms contained in this Paragraph 1 and any specific provision of this
Lease, the terms of the more specific provision shall prevail.




2. PREMISES.




     (a) Landlord hereby leases to Tenant and Tenant hereby leases from Landlord, the Premises
referenced in Paragraph 1 and outlined on the Depiction of Premises attached hereto as Exhibit A
and incorporated herein by this reference. The Premises consists of that certain Building located
at the address designated in Subparagraph 1(b) and the parcel or parcels of real property described
on the Description of Premises Land attached hereto as Exhibit B and incorporated herein by this
reference.



     (b) The parties agree that the letting and hiring of the Premises is upon and subject to the
terms, covenants and conditions herein set forth and Tenant covenants as a material part of the
consideration for this Lease to keep and perform each and all of said terms, covenants and
conditions by it to be kept and performed and that this Lease is made upon the condition of such
performance.



3. LEASE TERM.




     The Term of this Lease shall be for the period designated in Subparagraph 1(g) commencing on
the Commencement Date, and ending on the Expiration Date, unless the term hereby demised shall be
sooner terminated as herein provided (the “Term”). Landlord and Tenant shall execute Exhibit D to
confirm the Commencement Date and the Expiration Date and other matters.



4. POSSESSION; CONDITION OF PREMISES.




     (a) Delivery of Possession. Except as otherwise expressly provided in clauses (c) and
(d) below, Landlord agrees to deliver possession of the Premises to Tenant on the Commencement Date
in its “AS-IS,” “WHERE-IS,” with all faults condition. Notwithstanding the foregoing, Landlord
shall not be obligated to deliver possession of any portion of the Premises to Tenant until
Landlord has received from Tenant all of the following: (i) the Letter of Credit (defined
hereinbelow) and Prepaid Rent; (ii) executed copies of policies of insurance or certificates
thereof as required under Paragraph 16 of this Lease; and (iii) an executed original of the
Hazardous Materials Questionnaire in the form attached hereto as Exhibit I.



     (b) Condition of Premises. Except as otherwise expressly provided in clauses (c) and
(d) below, (i) by taking possession of the Premises, Tenant will be deemed to have accepted such
portion of the Premises in its “AS-IS,” “WHERE-IS,” with all faults condition on the date of
delivery of possession and to have acknowledged that there are no items needing work or repair, and
(ii) Tenant acknowledges that neither Landlord nor any agent of



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Landlord has made any
representation or warranty with respect to the Premises or any portions thereof or with
respect to the suitability of same for the conduct of Tenant’s business or any other business,
except as may be expressly provided herein.




     (c) Landlord’s Representations and Warranties. Landlord hereby represents and
warrants to Tenant that, as of the Commencement Date, to its actual knowledge: (i) Landlord has
received no written notice from any governmental agency that the Premises or any portion thereof is
in violation of any material building code or regulation applicable thereto; (ii) the Building
contains no defects, latent or patent; (iii) the Building, including the HVAC system and other
operating systems located therein, are in good working order; (iv) the Premises is in compliance
with the Americans with Disabilities Act of 1990, as amended (hereinafter, the “ADA”) (provided
Landlord shall not be responsible under this clause (iv) to the extent any noncompliance with the
ADA is attributable to (A) Tenant’s work within, or specific use of (as opposed to general
warehouse, office or manufacturing use), the Premises, and/or (B) any alterations to the Premises
made by or on behalf of Tenant); and, (v) except to the extent referenced on any environmental
report delivered to Tenant prior to the Commencement Date, there are no Hazardous Materials (as
defined in Exhibit H attached hereto) in the Building or on the Premises Land in violation of
applicable law. Tenant acknowledges and agrees that prior to the date of this Lease, Landlord
delivered to Tenant and Tenant received from Landlord copies of all of the environmental reports
identified on Exhibit L attached hereto.



     Notwithstanding the foregoing, Tenant acknowledges and agrees that (aa) if it is determined
that Landlord breached any of the representations and/or warranties described in clauses (i)
through (v) above, inclusive, Tenant’s sole and exclusive remedy shall be to cause Landlord to
remedy such breach (collectively, the “Breach Work”) and repair and restore any damage to Tenant’s
alterations and/or initial tenant improvements constructed by Tenant caused by Landlord during the
performance of the Breach Work (collectively, the “Alteration/TI Restoration Work”) (the Breach
Work and the Alteration/TI Restoration Work shall collectively be referred to herein as the
“Breach/Restoration Work”), (bb) if it purchases the Premises pursuant to the terms of Paragraphs 2
or 3 of Rider 1 attached hereto or otherwise, and this Lease is terminated substantially concurrent
with the close of escrow thereunder, Landlord’s above representations and warranties shall be void
and of no further force or effect (it being the intent of the parties hereto to recognize that such
representations and warranties shall not survive the termination of this Lease), (cc) the foregoing
representations and warranties of Landlord shall survive the Commencement Date only for a period of
twelve (12) months and shall thereafter be deemed extinguished except to the extent an action is
brought for a violation thereof within such twelve (12) month period, and (dd) under no
circumstances shall Landlord be obligated to expend in excess of Five Hundred Thousand and No/100
Dollars ($500,000.00) during its performance of any Alteration/TI Restoration Work.



     (d) Allowance; Tenant’s Work. So long as Tenant is not in default hereunder beyond
any applicable cure period, Landlord agrees to provide to Tenant a tenant improvement allowance of
$2.00 per square foot of space in the Premises, i.e., Three Hundred Sixty-Eight Thousand and No/100
Dollars ($368,000.00) (the “Allowance”). Tenant agrees to use the Allowance to (i) modify the base
Building and systems, (ii) remove all mezzanine space within the Building, and (iii) perform other
refurbishments and/or tenant improvements within the Building pursuant to the terms of Exhibit C
attached hereto (collectively, “Tenant’s Work”). Tenant further agrees that the exact scope and
construction of Tenant’s Work and Landlord’s payment of the Allowance to Tenant shall be governed
by the terms of the Work Letter Agreement attached hereto as Exhibit C.



5. RENT.




     (a) Basic Rent. From and after the Rent Commencement Date, Tenant agrees to pay
Landlord Basic Rent for the Premises at the Basic Rent rate designated in Subparagraph 1(h) in
twelve (12) equal monthly installments, each in advance of the first day of each and every calendar
month during the Term, except that the Prepaid Rent set forth in Subparagraph 1(i) shall be paid in
accordance with the terms of Paragraph 6 below. If the Term of this Lease commences on a day other
than the first day of a calendar month or ends on a day other than the last day of a calendar
month, then the rent (as defined below) for such periods shall be prorated in the proportion that
the number of days this Lease is in effect during such periods bears to thirty (30), and such rent
shall be paid at the commencement of such period. In addition to the Basic Rent, Tenant agrees to
pay Landlord as additional rent hereunder, Tenant’s Share of the Building’s Share of any expenses
incurred by Landlord and allocable to the Project as a whole, rather than allocated just to the
Building (e.g., any expenses payable by Landlord pursuant to the terms of the Project CC&Rs, etc.),
additional rent as provided in Paragraph 11 (Taxes), Paragraph 13 (Maintenance), Paragraph 16
(Insurance), the amount of all rental adjustments as and when hereinafter provided in this Lease,
and a management fee of two and one-half percent (2.5%) of the gross rent (i.e., Basic Rent and
additional rent) payable by Tenant pursuant to the terms of this Lease to cover Landlord’s
management, overhead and administrative expenses related to the operation of the Building, whether
performed by Landlord’s personnel or delegated by Landlord to a professional property manager. The
Basic Rent, any additional rent payable pursuant to the provisions of this Lease, and any rental
adjustments shall be paid to Landlord, without any prior demand therefor, and without any deduction
or offset, except as expressly provided herein, in lawful money of the United States of America,
which shall be legal tender at the time of payment, at the address of Landlord designated in
Subparagraph 1(c) or to such other person or at such other place as Landlord may from time to time
designate in writing. Further, all charges to be paid by Tenant hereunder, including, without
limitation, payments for real property taxes, insurance, repairs, and parking, if any, shall be
considered “additional rent” for the purposes of this Lease, and the word “rent” in this Lease
shall include such additional rent unless the context specifically or clearly implies that only the
Basic Rent is referenced. Basic Rent shall be adjusted as provided in Subparagraph 1(h).



     (b) Late Payment. Tenant acknowledges that late payment by Tenant to Landlord of any
rent or other sums due under this Lease will cause Landlord to incur costs not contemplated by this
Lease, the exact amount of such costs being extremely difficult and impracticable to ascertain.
Such costs include, without limitation,



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processing and accounting charges and late charges that may
be imposed on Landlord by the terms of any
encumbrance or note secured by the Premises. Therefore, if any rent or other sum due from
Tenant is not received within five (5) calendar days when due, Tenant shall pay to Landlord an
additional sum equal to 5% of such overdue payment for each month such payment remains overdue.
Landlord and Tenant hereby agree that such late charge represents a fair and reasonable estimate of
the costs that Landlord will incur by reason of any such late payment. Additionally, all such
delinquent rents or other sums, shall bear interest at the lesser of (i) twelve percent (12%) per
annum or (ii) the maximum legal interest rate (as applicable, the “Interest Rate”). Any payments
of any kind returned for insufficient funds will be subject to an additional handling charge of
$25.00.




     (c) Audit Right. In the event of any dispute as to the amount of Tenant’s Share of
Maintenance Expenses, Real Property Taxes and/or the cost of any insurance maintained by Landlord
hereunder (collectively, “Expenses”), Tenant or an accounting firm selected by Tenant and
reasonably satisfactory to Landlord (billing hourly and not on a contingency fee basis) will have
the right, by prior written notice (“Audit Notice”) given within one (1) year (“Audit Period”)
following receipt of the final statement of such Expenses incurred by Landlord during the
immediately previous calendar year (an “Actual Statement”) and at reasonable times during normal
business hours, to audit Landlord’s accounting records with respect to the Expenses relative to the
year to which such Actual Statement relates at the offices of Landlord’s property manager. In no
event will Landlord or its property manager be required to (i) photocopy any accounting records or
other items or contracts, (ii) create any ledgers or schedules not already in existence,
(iii) incur any costs or expenses relative to such inspection (except as expressly provided below),
or (iv) perform any other tasks other than making available such accounting records as aforesaid.
Tenant must pay Tenant’s Share of Expenses when due pursuant to the terms of this Lease and may not
withhold payment of such Expenses or any other rent pending results of the audit or during a
dispute regarding Expenses. The audit must be completed within sixty (60) days of the date of
Tenant’s Audit Notice and the results of such audit shall be delivered to Landlord within
ninety (90) days of the date of Tenant’s Audit Notice. If Tenant does not comply with any of the
aforementioned time frames, then such Actual Statement will be conclusively binding on Tenant. If
such audit or review correctly reveals that Landlord has overcharged Tenant and Landlord agrees
with the results of such audit, then within thirty (30) days after the results of such audit are
made available to Landlord, Landlord agrees to reimburse Tenant the amount of such overcharge. If
the audit reveals that Tenant was undercharged, then within thirty (30) days after the results of
the audit are made available to Tenant, Tenant agrees to reimburse Landlord the amount of such
undercharge. Tenant agrees to pay the cost of such audit, provided that if the audit reveals that
Landlord’s determination of the Building’s total Expenses as set forth in the relevant Actual
Statement was in error in Landlord’s favor by more than five percent (5%) of the total amount of
such Expenses pursuant to such Actual Statement, then Landlord agrees to pay the reasonable,
third-party cost of such audit incurred by Tenant. To the extent Landlord must pay the cost of
such audit, such cost shall not exceed a reasonable hourly charge for a reasonable amount of hours
spent by such third-party in connection with the audit. Tenant agrees to keep the results of the
audit confidential and will cause its agents, employees and contractors to keep such results
confidential. To that end, Landlord may require Tenant and its auditor to execute a commercially
reasonable confidentiality agreement provided by Landlord.



6. PREPAID RENT.




     On or before December 31, 2009, Tenant shall pay to Landlord the Prepaid Rent set forth in
Subparagraph 1(i), and if Tenant is not in default of any provision of this Lease, such Prepaid
Rent shall be applied during the month of January, 2010 with respect to Tenant’s leasing of the
Premises. Landlord’s obligations with respect to the Prepaid Rent are those of a debtor and not of
a trustee, and Landlord can commingle the Prepaid Rent with Landlord’s general funds. Landlord
shall not be required to pay Tenant interest on the Prepaid Rent. Landlord shall be entitled to
immediately endorse and cash Tenant’s Prepaid Rent; however, such endorsement and cashing shall not
constitute Landlord’s acceptance of this Lease. In the event Landlord does not accept this Lease,
Landlord shall return said Prepaid Rent. If Landlord sells the Premises and deposits with the
purchaser the Prepaid Rent, Landlord shall be discharged from any further liability with respect to
the Prepaid Rent.



7. LETTER OF CREDIT.




     (a) General Provisions. Concurrently with Tenant’s execution of this Lease, Tenant
shall deliver to Landlord, as additional collateral for the full performance by Tenant of all of
its obligations under this Lease and for all losses and damages Landlord may suffer as a result of
any default by Tenant under this Lease, including, but not limited to, any post lease termination
damages under Section 1951.2 of the California Civil Code, a standby, unconditional, irrevocable,
transferable letter of credit (the “Letter of Credit”) in the form of Exhibit K hereto and
containing the terms required herein, in the face amount of Two Million One Hundred Thousand and
No/100 Dollars ($2,100,000.00) (the “Letter of Credit Amount”), naming Landlord as beneficiary,
issued by Wells Fargo Bank or a financial institution acceptable to Landlord in Landlord’s sole
discretion, permitting multiple and partial draws thereon, and otherwise in form acceptable to
Landlord in its sole discretion. Tenant shall cause the Letter of Credit to be continuously
maintained in effect (whether through replacement, renewal or extension) in the Letter of Credit
Amount (as the same may be reduced as described in Subparagraph 7(f) below) through the date (the
“Final LC Expiration Date”) that is thirty (30) days after the scheduled expiration date of the
Term or any renewal Term of this Lease. If the Letter of Credit held by Landlord expires earlier
than the Final LC Expiration Date (whether by reason of a stated expiration date or a notice of
termination or non-renewal given by the issuing bank), Tenant shall deliver a new Letter of Credit
or certificate of renewal or extension to Landlord not later than thirty (30) days prior to the
expiration date of the Letter of Credit then held by Landlord. Any renewal or replacement Letter
of Credit shall comply with all of the provisions of this Paragraph 7, shall be irrevocable,
transferable and shall remain in effect (or be automatically renewable) through the Final LC
Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be
acceptable to Landlord in its sole discretion.



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     (b) Drawings under Letter of Credit. Landlord shall have the immediate right to draw
upon the Letter of Credit, in whole or in part, at any time and from time to time: (i) In an
amount sufficient to compensate Landlord
for damages suffered by it, if an event of default occurs and is not cured within the
applicable cure period provided for such default in this Lease and/or to compensate Landlord for
any and all damages it suffers upon termination of the Lease (provided Landlord may draw upon the
entire amount of the Letter of Credit if it elects to terminate this Lease pursuant to the terms of
Paragraph 21(b) below); (ii) In whole, if the Letter of Credit held by Landlord expires (or is set
to expire) earlier than the Final LC Expiration Date (whether by reason of a stated expiration date
or a notice of termination or non-renewal given by the issuing bank), and Tenant fails to deliver
to Landlord, at least thirty (30) days prior to the expiration date of the Letter of Credit then
held by Landlord, a renewal or substitute Letter of Credit that is in effect and that complies with
the provisions of this Paragraph 7; or (iii) In whole, if Tenant either files a voluntary petition,
or an involuntary petition is filed against Tenant by an entity other than Landlord or an affiliate
thereof, under any chapter of the Federal Bankruptcy Code, Tenant executes an assignment for the
benefit of creditors or Tenant is placed in receivership or otherwise becomes insolvent. No
condition or term of this Lease shall be deemed to render the Letter of Credit conditional to
justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit
in a timely manner. Tenant hereby acknowledges and agrees that Landlord is entering into this
Lease in material reliance upon the ability of Landlord to draw upon the Letter of Credit upon the
occurrence of any event of default by Tenant under this Lease or upon the occurrence of any of the
other events described above in this Paragraph 7(b).



     (c) Use of Proceeds by Landlord. The proceeds of the Letter of Credit shall
constitute Landlord’s sole and separate property (and not Tenant’s property or the property of
Tenant’s bankruptcy estate) and Landlord may immediately upon any draw (and without notice to
Tenant) apply or offset the proceeds of the Letter of Credit: (i) against any rent payable by
Tenant under this Lease that is not paid when due; (ii) against all losses and damages (A) that
Landlord has suffered, or (B) to the extent arising under Section 1951.2 of the California Civil
Code following termination of this Lease, that Landlord reasonably estimates that it may suffer as
a result of any default by Tenant under this Lease; (iii) against any costs incurred by Landlord in
connection with this Lease (including attorneys’ fees) to the extent that Tenant is responsible to
reimburse Landlord therefor pursuant to the terms hereof; and (iv) against any other amount that
Landlord may spend or become obligated to spend by reason of Tenant’s default. Provided Tenant has
performed all of its obligations under this Lease, Landlord agrees to pay to Tenant within
thirty (30) days after the Final LC Expiration Date the amount of any proceeds of the Letter of
Credit received by Landlord and not applied as allowed above; provided, that if prior to the Final
LC Expiration Date a voluntary petition is filed by Tenant, or an involuntary petition is filed
against Tenant by any of Tenant’s creditors, under the Federal Bankruptcy Code, then Landlord shall
not be obligated to make such payment in the amount of the unused Letter of Credit proceeds until
either all preference issues relating to payments under this Lease have been resolved in such
bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed, in
each case pursuant to a final court order not subject to appeal or any stay pending appeal.



     (d) Additional Covenants of Tenant. If, as result of any application or use by
Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be
less than the Letter of Credit Amount, Tenant shall, within ten (10) days after its receipt of
notice from Landlord, provide Landlord with additional letter(s) of credit in an amount equal to
the deficiency (or a replacement letter of credit in the total Letter of Credit Amount), and any
such additional (or replacement) letter of credit shall comply with all of the provisions of this
Paragraph 7, and if Tenant fails to comply with the foregoing, notwithstanding anything to the
contrary contained in this Lease, the same shall, at Landlord’s election, constitute an uncurable
event of default by Tenant. Tenant further covenants and warrants that it will neither assign nor
encumber the Letter of Credit or any part thereof and that neither Landlord nor its successors or
assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted
encumbrance.



     (e) Transfer of Letter of Credit. Landlord may, at any time and without notice to
Tenant and without first obtaining Tenant’s consent thereto, transfer all or any portion of its
interest in and to the Letter of Credit to any transferee of Landlord’s interest in the Building
and/or Landlord’s mortgagee and/or to have the Letter of Credit reissued in the name of Landlord’s
mortgagee. If Landlord transfers its interest in the Building and transfers the Letter of Credit
(or any proceeds thereof then held by Landlord) in whole or in part to the transferee, Landlord
shall, without any further agreement between the parties hereto, thereupon be released by Tenant
from all liability therefor. The provisions hereof shall apply to every transfer or assignment of
all or any part of the Letter of Credit to a new landlord. In connection with any such transfer of
the Letter of Credit by Landlord, Tenant shall, at Tenant’s sole cost and expense (except as
provided below), execute and submit to the issuer of the Letter of Credit such applications,
documents and instruments as may be reasonably necessary to effectuate such transfer.
Notwithstanding the foregoing, Landlord shall be responsible for paying the issuer’s transfer and
processing fees in connection with any transfer of the Letter of Credit.



     (f) Reduction in Letter of Credit Amount. Subject to the provisions of this
Subparagraph 7(f) and provided that Tenant has not been in default or breach of any provision of
the Lease beyond any applicable cure periods at any time prior to an applicable Reduction Date
(defined below), then Tenant shall be entitled to reduce the Letter of Credit Amount effective as
of the last day of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th) and
forty-eighth (48th) months of the initial Term (individually, a “Reduction Date” and
collectively, the “Reduction Dates”) as follows: On each Reduction Date, Tenant shall be entitled
to reduce the Letter of Credit Amount by an amount equal to Two Hundred Twenty-Five Thousand and
No/100 Dollars ($225,000.00). For example, if Tenant has not been in default or breach of any
provision of this Lease beyond any applicable cure periods at any time prior to the Reduction Date
occurring on the last day of the twelfth (12th) month of the Term and Tenant duly and timely pays
the Monthly Basic Rent and additional rent that is due and payable on the first day of the twelfth
(12th) month, Tenant would be entitled to reduce the Letter of Credit Amount by Two Hundred
Twenty-Five Thousand and No/100 Dollars ($225,000.00) to One Million Eight Hundred Seventy-Five
Thousand and No/100 Dollars ($1,875,000.00) effective as of the last day of the twelfth
(12th) month of the initial Term.



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     If Tenant is eligible for a Letter of Credit reduction on a Reduction Date, Landlord shall
execute any documents reasonably requested by Tenant and the issuing bank to effectuate the
applicable release of the Letter of Credit, within fifteen (15) days after Tenant submits such
documents to Landlord for execution provided Tenant is not then in default under this Lease.



     (g) Nature of Letter of Credit. Landlord and Tenant (1) acknowledge and agree that in
no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor
or any proceeds thereof be deemed to be or treated as a “security deposit” under any Law applicable
to security deposits in the commercial context including Section 1950.7 of the California Civil
Code, as such section now exists or as may be hereafter amended or succeeded (“Security Deposit
Laws”), (2) acknowledge and agree that the Letter of Credit (including any renewal thereof or
substitute therefor or any proceeds thereof) is not intended to serve as a security deposit, and
the Security Deposit Laws shall have no applicability or relevancy thereto, and (3) waive any and
all rights, duties and obligations either party may now or, in the future, will have relating to or
arising from the Security Deposit Laws. Tenant hereby waives the provisions of Section 1950.7 of
the California Civil Code and all other provisions of law, now or hereafter in effect, which (i)
establish the time frame by which Landlord must refund a security deposit under a lease, and/or
(ii) provide that Landlord may claim from the Security Deposit only those sums reasonably necessary
to remedy defaults in the payment of rent, to repair damage caused by Tenant or to clean the
Premises, it being agreed that Landlord may, in addition, claim those sums specified in this
Paragraph 7.



8. USE OF PREMISES AND PROJECT FACILITIES.




     (a) Tenant’s Use of the Premises. Tenant shall use the Premises for the Specific Use
set forth in Subparagraph 1(d) above, and shall not use or permit the Premises to be used for any
other purpose without the prior written consent of Landlord, which consent Landlord shall not
unreasonably withhold. Landlord makes no representations or warranties that said use of the
Premises or any other use of the Premises is permitted by any duly constituted public authority
having jurisdiction over the Premises or the conduct of Tenant’s business. Tenant acknowledges and
agrees that it, and not Landlord, is responsible to confirm whether (i) the Premises is properly
zoned for the Specific Use, (ii) Tenant may use the Premises for the Specific Use 24 hours a day,
and/or (iii) Tenant is required to obtain a conditional use permit to operate 24 hours a day from
the Premises (the “Conditional Use Permit”); provided, however, Landlord agrees to use its
commercially reasonable efforts to assist Tenant at no expense to Landlord in obtaining the
Conditional Use Permit; provided further, however, Tenant acknowledges and agrees that Tenant shall
not have the right to terminate this Lease or delay the Lease Commencement or Rent Commencement if
it fails to obtain such Conditional Use Permit.



     (b) Compliance. At Tenant’s sole cost and expense, Tenant shall procure, maintain and
hold available for Landlord’s inspection, all governmental licenses and permits required for
Tenant’s use of the Premises and the proper and lawful conduct of Tenant’s business from the
Premises. Tenant shall at all times during the Term of this Lease, at its sole cost and expense,
observe and comply with the certificate of occupancy issued for the Building, the Project CC&Rs
(defined below) and all laws, statutes, zoning restrictions, ordinances, rules, regulations and
requirements of any duly constituted public authority having jurisdiction over the Premises now or
hereafter in force relating to or affecting the use, occupancy, alteration or improvement of the
Premises including, without limitation, the provisions of Title III of the Americans with
Disabilities Act of 1990, as amended. Tenant shall not use or occupy the Premises in violation of
any of the foregoing. Tenant shall, upon written notice from Landlord, discontinue any use of the
Premises which is declared by any governmental and/or quasi-governmental authority having
jurisdiction over the Premises to be a violation of law or of said certificate of occupancy;
provided, any ADA compliance work triggered by a noncompliance with the ADA existing as of the date
of this Lease and necessitated by anything other than Tenant’s improvement work or Tenant’s
Permitted Use of the Premises (as opposed to general warehouse, office or manufacturing use) shall
be the responsibility of Landlord and shall be performed by Landlord at Landlord’s sole cost and
expense. Tenant shall comply with all rules, orders, regulations and requirements of the Board of
Fire Underwriters or any other insurance authority having jurisdiction over the Premises or any
present or future insurer relating to the Premises. Tenant shall promptly, upon demand, reimburse
Landlord for any additional premium charged for any existing insurance policy or endorsement
required by reason of Tenant’s failure to comply with the provisions of this Paragraph 8. Tenant
shall not use or allow the Premises to be used for any improper, immoral, unlawful or objectionable
purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about the Premises;
provided, Landlord hereby acknowledges that the use of the Premises for the Specific Use will not
violate the foregoing. Tenant shall comply with the Rules and Regulations referred to in
Paragraph 32 and attached hereto as Exhibit F, and all existing restrictive covenants and
obligations recorded against the Premises and/or Project, which affect the use and operation of the
Premises, including, without limitation, that certain Declaration of Covenants, Conditions and
Restrictions for Pacific Gateway Business Center dated December 22, 2005 and recorded in the
Official Records of Orange County, California on December 22, 2005 as Document No. 2005001023974
(as the same may be subsequently amended, the “Project CC&Rs”) and any other recorded documents;
provided, however, Landlord will not consent to and shall oppose any amendment to the Project CC&Rs
(to the extent Landlord has the right to do so under the Project CC&Rs) that if entered into, will
materially and adversely affect Tenant’s right to use the Premises pursuant to the terms of this
Lease for the Specific Use; provided further, however, nothing in this sentence above shall
obligate Landlord to commence litigation. Tenant shall not commit or suffer to be committed any
waste in or upon the Premises and shall keep the Premises in first-class repair and appearance,
ordinary wear and tear and damage resulting from a casualty (provided such casualty is not the
result of any Tenant Party’s negligence or willful misconduct) excepted. Further, Tenant’s
business machines and mechanical equipment which cause vibration or noise that may be transmitted
to the Building structure or, in the event any other tenant occupies space in the Building, to any
other space in the Building, shall be so installed, maintained and used by Tenant as to eliminate
or minimize such vibration or noise. Tenant shall be responsible for all structural engineering
required to determine structural load, as well as the expense thereof.



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     (c) Hazardous Materials. Tenant shall not cause or permit any Hazardous Materials to
be brought upon, stored, used, generated, released into the environment or disposed of in, on,
under or about the Premises by Tenant, its agents, employees, contractors or invitees, in violation
of the terms of Exhibit H attached hereto.



     (d) Parking. Subject to the terms of the Project CC&Rs, Landlord grants to Tenant an
exclusive license to use the vehicle parking spaces within the designated parking areas at the
Premises as shown on Exhibit A for the use of motor vehicles during the Term of this Lease.
Landlord reserves the right at any time to promulgate reasonable rules and regulations relating to
the use of such parking areas, including reasonable restrictions thereon; provided, however,
subject to the terms of Subparagraph 8(b) above pursuant to which Landlord agrees to oppose certain
amendments to the Project CC&Rs, Tenant hereby agrees that any rules and/or regulations adopted
pursuant to the terms of the Project CC&Rs are deemed reasonable. Any vehicle violating any
vehicle regulation is subject to removal at the owner’s expense.



     (e) Survival. The provisions of this Paragraph 8 shall survive any termination of
this Lease.



9. SURRENDER OF PREMISES; HOLDING OVER.




     Upon the expiration of the Term of this Lease including any extension periods, Tenant shall
surrender to Landlord the Premises and all Tenant Improvements and/or alterations in good
condition, except for ordinary wear and tear, alterations Tenant has the right or is obligated to
remove under the provisions of Paragraph 14 herein and any other restoration that is then
prohibited by applicable law, e.g., Tenant shall not be required to restore any mezzanine space
removed from the Premises if the then current parking ratios required under applicable law prohibit
such restoration; provided, however, Tenant acknowledges and agrees that, unless otherwise agreed
to in writing by Landlord, Tenant shall, on or before the expiration or earlier termination of this
Lease, be required, at its sole cost and expense, to (a) remove all of Tenant’s Work from the
Premises, and (ii) restore the Premises and any improvements thereto that were removed or altered
during the Term, including, without limitation, any office area and/or mezzanine area located
within the Building on the Commencement Date, to the condition existing as of the date of this
Lease. Subject to Paragraph 14, Tenant shall remove all personal property, including, without
limitation, all wallpaper, paneling and other decorative improvements or fixtures and shall perform
all restoration made necessary by the removal of any alterations or Tenant’s personal property
before the expiration of the Term, including, for example, restoring all wall surfaces to their
condition prior to the commencement of this Lease, ordinary wear and tear and damage resulting from
a casualty (provided such casualty is not the result of any Tenant Party’s negligence or willful
misconduct) excepted. Landlord may elect to retain or dispose of in any manner Tenant’s personal
property not removed from the Premises by Tenant prior to the expiration of the Term. Tenant
waives all claims against Landlord for any damage to Tenant resulting from Landlord’s retention or
disposition of Tenant’s personal property. Tenant shall be liable to Landlord for Landlord’s
actual and reasonable costs for storage, removal or disposal of Tenant’s personal property.



     If Tenant, with Landlord’s consent, remains in possession of the Premises after expiration or
termination of the Term, or after the date in any notice given by Landlord to Tenant terminating
this Lease, such possession by Tenant shall be deemed to be a month-to-month tenancy terminable on
written thirty (30) day notice at any time, by either party. All provisions of this Lease, except
those pertaining to Term and rent, shall apply to the month-to-month tenancy. During such
month-to-month tenancy, Tenant shall pay monthly rent in an amount equal to 150% of Basic Rent for
the last full calendar month during the immediately preceding Term plus 100% of additional rent as
provided in Paragraph 11 (Taxes), Paragraph 13 (Maintenance), Paragraph 16 (Insurance), subject to
increase as provided therein; provided, however, during the first thirty (30) days of any such
month-to-month tenancy, the above reference to “150%” shall be changed to a reference to “125%”.
Any such holdover rent shall be paid on a per month basis without reduction for partial months
during the holdover. Acceptance by Landlord of rent after such expiration or earlier termination
shall not constitute consent to a hold over hereunder or result in an extension of this Lease.
This paragraph shall not be construed to create any express or implied right to holdover beyond the
expiration of the Term or any extension thereof. If Tenant, without Landlord’s written consent to
remain in the Premises, fails to surrender the Premises after expiration or termination of the
Term, Tenant shall indemnify, defend and hold harmless Landlord from all loss or liability,
including, without limitation, any loss or liability resulting from any claim against Landlord made
by any succeeding tenant founded on or resulting from Tenant’s failure to surrender and losses to
Landlord due to lost opportunities to lease any portion of the Premises to succeeding tenants,
together with, in each case, actual attorneys’ fees and costs.



10. SIGNAGE.




     Landlord shall designate the location at or adjacent to the Premises for one or more Tenant
identification sign(s). Landlord on behalf of Tenant and at the expense of Tenant, shall install
and maintain Tenant’s identification sign(s) in such designated locations in accordance with this
Paragraph 10 and Exhibit G. Tenant shall have no right to install or maintain Tenant
identification signs in any other location in, on or about the Premises and shall not display or
erect any other signs, displays or other advertising materials that are visible from the exterior
of the Building. The size, design, color and other physical aspects of permitted sign(s) shall be
subject to: (i) Landlord’s written approval prior to installation, which approval may be withheld
in Landlord’s discretion; (ii) the Project CC&Rs; and (iii) any applicable municipal or
governmental permits and approvals. The cost of the sign(s), including the installation,
maintenance and removal thereof, shall be at Tenant’s sole cost and expense. If Tenant fails to
install or maintain its sign(s), or if Tenant fails to remove same upon termination of this Lease
and repair any damage caused by such removal, including, without limitation, touching-up the
Building paint (or repainting a portion of the Building, if necessary) (if required by Landlord, in
Landlord’s sole but reasonable judgment), Landlord may do so at Tenant’s expense. Tenant shall
reimburse Landlord for all costs incurred by Landlord to effect such installation, maintenance or
removal, which amount shall be deemed additional rent, and shall include, without limitation, all
sums disbursed, incurred or deposited by Landlord, including Landlord’s costs and expenses



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with interest thereon at the Interest Rate from the date of Landlord’s demand until payment.
Any sign rights granted to Tenant under this Lease are personal to Tenant, any Permitted Transferee
(defined in Paragraph 19 below) and any other assignee or sublessee of the Building and may not be
assigned, transferred or otherwise conveyed to any third party without Landlord’s prior written
consent, which consent Landlord may withhold in its sole and absolute discretion.




11. TAXES.




     (a) Personal Property Taxes. Tenant shall pay before delinquency all taxes,
assessments, license fees and public charges levied, assessed or imposed upon its business
operations as well as upon all trade fixtures, leasehold improvements, merchandise and other
personal property in or about the Premises.



     (b) Real Property Taxes. Tenant shall pay, as additional rent, Tenant’s Share of all
Real Property Taxes, including all taxes, assessments (general and special) and other impositions
or charges which may be taxed, charged, levied, assessed or imposed with respect to any calendar
year or part thereof included within the Term upon all or any portion of or in relation to the
Premises or any portion thereof, any leasehold estate in the Premises or measured by rent from the
Premises, including any increase caused by the transfer, sale or encumbrance of the Premises or any
portion thereof, however, specifically excluding any income taxes payable by Landlord. “Real
Property Taxes” shall also include any form of assessment, levy, penalty, charge or tax (other than
estate, inheritance, net income or franchise taxes) imposed by any authority having a direct or
indirect power to tax or charge, including, without limitation, any city, county, state, federal or
any improvement or other district, whether such tax is: (1) determined by the area of the Premises
or the rent or other sums payable under this Lease; (2) upon or with respect to any legal or
equitable interest of Landlord in the Premises or any part thereof; (3) upon this transaction or
any document to which Tenant is a party creating a transfer in any interest in the Premises; (4) in
lieu of or as a direct substitute in who or in part of or in addition to any real property taxes on
the Premises; (5) based on any parking spaces or parking facilities provided at the Premises; or
(6) in consideration for services, such as police protection, fire protection, street, sidewalk and
roadway maintenance, refuse removal or other services that may be provided by any governmental or
quasi-governmental agency from time to time which were formerly provided without charge or with
less charge to property owners or occupants. Tenant shall pay Real Property Taxes on the date any
taxes or installments of taxes are due and payable as determined by the taxing authority, evidenced
by the tax bill. Landlord shall determine and notify Tenant of the amount of Real Property Taxes
not less than twenty (20) days in advance of the date such tax or installment of taxes is due and
payable. In the event Landlord fails to deliver such timely determination and notice to Tenant,
then Tenant shall have twenty (20) days from receipt of such notice to remit payment of Real
Property Taxes to Landlord. The foregoing notwithstanding, upon notice from Landlord, Tenant shall
pay, as additional rent, Real Property Taxes to Landlord in advance monthly installments equal to
one twelfth (1/12) of Landlord’s reasonable estimate of the Real Property Taxes payable under this
Lease, together with monthly installments of Basic Rent, and Landlord shall hold such payments in a
non-interest bearing account. Landlord shall determine and notify Tenant of any deficiency in the
impound account and Tenant shall pay any deficiency of funds in the impound account not less than
twenty (20) days in advance of the date such tax or installment of taxes is due and payable. In
the event Landlord fails to deliver such timely deficiency determination and notice to Tenant, then
Tenant shall have twenty (20) days from receipt of such notice to remit payment of such deficiency
to Landlord. If Landlord determines that Tenant’s impound account has accrued an amount in excess
of the Real Property Taxes due and payable, then such excess shall be credited to Tenant within
thirty (30) days from Landlord’s determination.



12. UTILITIES.




     Tenant shall pay directly to the utility companies providing such services, the cost of all
water, gas, heat, light, power, sewer, electricity, telephone or other service metered, chargeable
or provided to the Premises. Landlord shall not be liable in damages or otherwise for any failure
or interruption of any utility or other service furnished to the Premises. No such failure or
interruption shall entitle Tenant to terminate this Lease or abate rent in any manner and Tenant
hereby waives the provisions of any applicable existing or future law, ordinance or regulation
permitting the termination of this Lease due to an interruption, failure or inability to provide
any services (including, without limitation, the provisions of California Civil Code Section
1932(1)). Notwithstanding anything in this Lease to the contrary, if, as a result of the negligent
acts or omissions of Landlord or its agents, contractors or employees, for more than three (3)
consecutive business days following written notice to Landlord, there is such an interruption of
essential utilities and Building services, such as fire protection, electricity or water, so that
any portion of the Premises cannot be and is not used by Tenant, in Tenant’s judgment reasonably
exercised, then Tenant’s rent shall thereafter be abated until the Premises are again usable by
Tenant in proportion to the extent to which Tenant’s use of the Premises is interfered with;
provided, however, that if Landlord is diligently pursuing the repair of such utilities or services
and Landlord provides substitute services reasonably suitable for Tenant’s purposes, as for
example, bringing in portable air-conditioning equipment, then there shall not be an abatement of
rent. This paragraph shall not apply in case of damage to, or destruction of, the Building, which
shall be governed by a separate provision of this Lease.



13. MAINTENANCE.




     (a) Performed by Tenant. Except as provided below, Tenant shall maintain, repair and
replace (as necessary) the Premises in good condition, including, without limitation, maintaining,
repairing and replacing (as necessary) of all of the following: non-structural portions of the
walls and floors; ceilings; telephone equipment and wiring; doors; exterior and interior windows
and fixtures as well as damage caused by Tenant, its agents, contractors, employees or invitees.
Tenant shall comply with the provisions of California Health and Safety Code Sections 26142 and
26145. Upon expiration or termination of this Lease, Tenant shall surrender the Premises to
Landlord in the same condition as existed at the commencement of the Term, except for reasonable
wear and tear or



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damage caused by fire or other casualty. Tenant shall, at its own expense, provide, install
and maintain in good condition all of its personal property required in the conduct of its business
on the Premises. If Tenant refuses or neglects to repair, replace and maintain the Premises as
required hereunder and to the reasonable satisfaction of Landlord, Landlord may at any time
following ten (10) days from the date on which Landlord shall make a written demand on Tenant to
effect such repair, replacement and maintenance (emergencies excepted in which case no such demand
shall be required), enter upon the Premises and make such repairs, replacements and/or maintenance
without liability to Tenant for any loss or damage which might occur to Tenant’s merchandise,
fixtures or other property or to Tenant’s business by reason thereof, and upon completion thereof,
Tenant shall pay to Landlord, Landlord’s costs for making such repairs plus ten percent (10%) for
overhead, upon presentation of a bill therefor. Said bill shall include interest at the Interest
Rate on said costs from the date of completion of the maintenance and repairs by Landlord. Tenant
shall, at its own expense, provide, install and maintain in good condition all of its personal
property required in the conduct of its business on the Premises.




     (b) Performed by Landlord. Subject to reimbursement by Tenant as hereinafter
provided, Landlord shall be responsible to maintain, in good condition, the structural parts of the
Premises, which shall include only the foundations, bearing and exterior walls (including
painting), subflooring; the roof system and skylights; the unexposed electrical, plumbing and
sewerage systems, including without limitation, those portions of the systems lying outside the
Premises; the paved and hardscaped parking and driveway areas (including resurfacing and
restriping); window frames, gutters and downspouts on the Building; the heating, ventilating and
air conditioning system servicing the Premises; the outside areas of the Premises and every part
thereof, including, without limitation, the soil, landscaping (including replacement thereof),
sprinkler system, walkways, parking areas (including periodic sweeping), signs, site lighting and
pest control. Landlord shall not be liable for any failure to make any such repairs or any
maintenance unless such failure shall persist for an unreasonable time after written notice of the
need of such repairs or maintenance is given to Landlord by Tenant.



     (c) Reimbursement by Tenant. Prior to the commencement of each calendar year,
Landlord shall give Tenant a written estimate of the expenses Landlord anticipates will be incurred
for the ensuing calendar year with respect to the maintenance and repair to be performed by
Landlord as herein described (the “Maintenance Expenses”). Tenant shall pay, as additional rent,
such estimated expenses in equal monthly installments in advance on or before the first day of each
month concurrent with its payment of Basic Rent. Within ninety (90) days after the end of each
calendar year, Landlord shall furnish Tenant a statement showing in reasonable detail the actual
expenses incurred for the period in question and the parties shall within thirty (30) days
thereafter make payment or allowance as necessary to adjust Tenant’s estimated payments to the
actual expenses as shown by applicable periodic statements submitted by Landlord. If Landlord
shall determine at any time that the estimate of expenses for the current calendar year is or will
become inadequate to meet all such expenses for any reason, Landlord shall immediately determine
the appropriate amount of such inadequacy and issue a supplemental estimate as to such expenses,
and Tenant shall pay any increase in the estimated expenses as reflected by such supplemental
estimate within twenty (20) days following receipt of written request from Landlord. Tenant’s
failure to timely pay any of the charges in connection with the performance of its maintenance and
repair obligations to be paid under this Paragraph 13 shall constitute a material default under
this Lease.



     Landlord shall keep or cause to be kept separate and complete books of account covering costs
and expenses incurred in connection with its maintenance and repair of the Building and outside
areas, which costs and expenses shall include, without limitation, the actual costs and expenses
incurred in connection with labor and material utilized in performance of the maintenance and
repair obligations hereinafter described, public liability, property damage and other forms of
insurance which Landlord may, or is required to, maintain, assessments which may be levied against
the Premises under any recorded covenants, conditions and restrictions, and any other items
reasonable necessary from time to time to properly repair, replace and maintain the outside areas
and any interest paid in connection therewith. Landlord may elect to delegate its duties hereunder
to a professional property manager; provided, however, that any fee charged by such professional
property manager and passed through to Tenant hereunder shall reduce the management fee owed to
Landlord hereunder dollar-for-dollar.



     Except as provided in Paragraph 17 hereof, there shall be no abatement of rent and no
liability of Landlord by reason of any injury to or interference with Tenant’s business arising
from the making of any repairs, alterations or improvements in or to any portion of the Building or
the Premises or in or to fixtures, appurtenances and equipment therein. Tenant waives the right to
make repairs at Landlord’s expense under Sections 1941 and 1942 of the California Civil Code or any
similar law, statute or ordinance now or hereafter in effect and under the provisions of California
Health and Safety Code Section 26143 with respect to those maintenance obligations which are
Tenant’s responsibility under the terms of this Lease.



     (d) Structural/Foundation Capital Costs. Notwithstanding the terms of
Subparagraphs 13(b) and (c) above, Landlord agrees that (i) during the initial Term of this Lease
(i.e., the initial 126-month period), Tenant shall not be responsible to reimburse Landlord as part
of Maintenance Expenses for any costs which would otherwise be deemed capital in nature pursuant to
generally accepted accounting principles (“GAAP”) and incurred by Landlord solely in connection
with its replacement of (A) the structural portions of the Building’s roof or walls, and/or (B) the
Building’s foundation or slab (collectively, the “Structural/Foundation Capital Costs”), and
(ii) following the initial Term of this Lease, Tenant shall be responsible to reimburse Landlord as
part of Maintenance Expenses for all Structural/Foundation Capital Costs to the extent such costs
are amortized (including an interest factor equal to the rate announced from time to time by Wells
Fargo Bank or, if Wells Fargo Bank ceases to exist or ceases to publish such rate, then the rate
announced from time to time by the largest (as measured by deposits) chartered bank operating in
California, as its “prime rate” or “reference rate”) over the useful life (as determined in
accordance with GAAP) of such capital improvements, repairs or replacements; provided that Tenant
shall be responsible to immediately reimburse Landlord as part of Maintenance Expenses (without
regard to the amortization process or the



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initial Term protection described above) for any Structural/Foundation Capital Costs to the
extent the same are attributable to Tenant’s or any of the Tenant Parties’ negligence or willful
misconduct.




14. ALTERATIONS.




     (a) Alterations. Tenant shall not make any alterations to the Premises, including any
changes to the existing landscaping, without Landlord’s prior written consent. Any alterations
made shall remain on and be surrendered with the Premises upon expiration of the Term, except that
Landlord may, within thirty (30) days before or thirty (30) days after expiration of the Term,
elect to require Tenant to remove any alterations which Tenant may have made to the Premises
(unless otherwise agreed to in writing by Landlord prior to such date). If Landlord so elects,
Tenant shall, at its own cost, restore the Premises to the condition designated by Landlord in its
election, before the last day of the Term or within thirty (30) days after notice of its election
is given, whichever is later. Notwithstanding the foregoing, Tenant may make non-structural
alterations to the interior of the Premises upon twenty (20) days prior written notice to Landlord
so long as such alterations do not (i) exceed Two Hundred Fifty Thousand Dollars ($250,000.00)
individually and/or One Million Dollars ($1,000,000.00) in the aggregate during the Term of this
Lease, (ii) materially affect the Building’s and/or Project’s services or systems, or proper
functioning thereof, or Landlord’s or any other tenant’s access thereto, (iii) violate or require a
change in any occupancy certificate applicable to the Building or Premises, or (iv) materially
affect the Building’s foundation and/or the structural or exterior portions of the Building.



     (b) Standard of Work. Should Landlord consent in writing to Tenant’s alteration of
the Premises, Tenant shall contract with a contractor approved by Landlord for the construction of
such alterations, shall secure all appropriate governmental approvals and permits, and shall
complete such alterations with due diligence, in a first-class manner, in compliance with plans and
specifications approved by Landlord, and in compliance with all applicable laws, statutes and
regulations. Tenant shall pay all costs for such construction (including a commercially reasonable
construction management fee payable to Landlord or Landlord’s property manager not to exceed the
lesser of (i) five percent (5%) of the total cost of construction or (ii) $25,000.00) and shall
keep the Premises free and clear of all mechanics’ liens which may result from construction by
Tenant. In addition to the above described construction management fee payable to Landlord, Tenant
shall also be responsible to promptly reimburse Landlord upon request for any and all third party
structural engineer review fees (the “Engineer Fees”) incurred by Landlord in connection with
Landlord’s review of any Tenant requested alterations that affect the structural integrity of the
Building; provided, however, if Tenant elects to retain the structural engineer of record for the
Building as designated by Landlord to oversee its construction, Tenant shall not be responsible to
reimburse Landlord for any such Engineer Fees. Subject to the terms of Paragraph 23 below,
Landlord shall have the right, but not the obligation, to enter upon the Premises to inspect
periodically the work on the Premises.



     (c) Liens. Tenant shall pay all costs for such construction and shall keep the
Premises free and clear of all mechanics’ and materialmens’ liens which may result from
construction by Tenant. Tenant shall provide at least ten (10) days prior written notice to
Landlord before any labor is performed, supplies furnished or services rendered on or at the
Premises and Landlord shall have the right to post on the Premises notices of non-responsibility.



15. RELEASE AND INDEMNITY.




     As material consideration to Landlord, Tenant agrees that Landlord, its agents,
successors-in-interest with respect to the Premises and their respective directors, officers,
partners, members, employees, shareholders, agents and representatives and the directors, officers,
partners, members, employees, shareholders, agents and representatives of the partners or members
of Landlord (collectively, the “Landlord Indemnified Parties”) shall not be liable to Tenant or any
of the Tenant Parties for: (i) any damage to any property entrusted to employees of the Premises,
Landlord or the Landlord Indemnified Parties, (ii) loss or damage to any property by theft or
otherwise, (iii) consequential damages arising out of any loss of the use of the Premises or any
equipment or facilities therein, or (iv) any injury or damage to person or property resulting from
fire, explosion, falling plaster, steam, gas, electricity, water or rain which may leak from any
part of the Premises or from pipes, appliances or plumbing work therein or from the roof, street,
sub-surface or from any other place or resulting from dampness or any other causes whatsoever.
Landlord and/or the Landlord Indemnified Parties shall not be liable for interference with light or
other incorporeal hereditaments, nor shall Landlord or the Landlord Indemnified Parties be liable
for any latent defects in the Premises. Tenant shall give prompt notice to Landlord in case of
fire or accidents in the Premises and of defects therein or in the fixtures or equipment located
therein.



     To the fullest extent permitted by law, Tenant agrees to indemnify, defend (with counsel
satisfactory to Landlord) and hold harmless Landlord and the Landlord Indemnified Parties from
(i) all claims, actions liabilities, and proceedings arising from Tenant’s use of the Premises or
the conduct of its business or from any activity, work or thing done, permitted or suffered by
Tenant, its agents, contractors, sublessees, employees or invitees, in or about the Premises and
any breach or default in the performance of any obligation to be performed by Tenant under the
terms of this Lease, or arising from any act, neglect, fault or omission of Tenant, or of its
agents, contractors, employee or invitees, and (ii) any and all costs, attorneys’ fees, expenses
and liabilities incurred with respect to any such claims, actions, liabilities, or proceedings, and
in the event any actions or proceedings shall be brought against Landlord by reason of such claims,
Tenant, upon notice from Landlord, shall defend the same at Tenant’s expense by counsel approved in
writing by Landlord. Tenant hereby assumes all risk of damage to property or injury to person in,
upon or about the Premises from any cause whatsoever, and Tenant hereby waives all its claims in
respect thereof against Landlord. Notwithstanding anything to the contrary contained in this
Paragraph 15 or elsewhere in this Lease, Tenant shall not be required to indemnify and hold
Landlord or any Landlord Indemnified Parties harmless from any claims, actions, liabilities, and
proceedings to the extent resulting from the negligence or willful misconduct of Landlord or any
Landlord Indemnified Parties (the “Landlord Indemnified Claims”), and, subject to



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the limitations contained in Paragraph 27 of this Lease, Landlord agrees to indemnify and hold
Tenant harmless from and against any and all such Landlord Indemnified Claims (except for damage to
Tenant’s personal property, fixtures, furniture and equipment in the Premises, to the extent Tenant
is required to obtain insurance coverage therefor pursuant to the terms of this Lease) and any and
all reasonable costs, attorneys’ fees, expenses and liabilities incurred with respect to any such
Landlord Indemnified Claims to the extent the same shall be brought against Tenant by reason of
claims subject to this indemnity. Landlord’s and Tenant’s indemnification obligations under this
paragraph will survive the expiration or earlier termination of this Lease and are not intended to
and will not relieve any insurance carrier of its obligations under policies required to be carried
by Landlord and/or by Tenant pursuant to the provisions of this Lease.




     As used herein, the term “liabilities” shall include all suits, actions, claims and demands
and all expenses (including attorneys’ fees and costs of defense) incurred in or about any such
liability and any action or proceeding brought thereon. If any claim shall be made or any action
or proceeding brought against Landlord on the basis of any liability described in this
Paragraph 15, Tenant shall, upon notice from Landlord, defend the same at Tenant’s expense by
counsel reasonably satisfactory to Landlord. It is understood that payment shall not be a
condition precedent to recovery upon the foregoing indemnity.



16. INSURANCE.




     Tenant, at its cost, shall pay for and keep in full force and effect throughout the Term of
this Lease:



     (a) COMMERCIAL GENERAL LIABILITY insurance with respect to the Premises and the operations by
or on behalf of Tenant in, on or about the Premises, including, but not limited to, personal
injury, product liability (if applicable), blanket contractual, owner’s protective, broad form
property damage liability, liquor liability (if applicable) and owned and non-owned automobile
liability in an amount not less than $5,000,000 per occurrence. The insurance policy or policies
shall contain the following provisions: (1) severability of interest, (2) cross-liability, (3) an
endorsement naming Landlord, Landlord’s Mortgagees and Ground Lessors (as defined in
Subparagraph 34(m) below) if any, and any other parties-in-interest designated by Landlord as
additional insureds, (4) an endorsement stating “such insurance as is afforded by this policy for
the benefit of Landlord and any other additional insured shall be primary as respects any liability
or claims arising out of the occupancy of the Premises by the Tenant, or Tenant’s operations and
any insurance carried by Landlord, or any other additional insured shall be non-contributory,”
(5) with respect to improvements or alterations permitted under this Lease, contingent liability
and builder’s risk insurance, (6) an endorsement allocating to the Premises the full amount of
liability limits required by this Lease, and (7) coverage must be on an “occurrence basis.”
“Claims-Made” forms are not acceptable.



     (b) WORKERS COMPENSATION COVERAGE as required by law, together with Employers Liability
coverage with a limit of not less than $2,000,000.



     (c) TENANT’S PROPERTY INSURANCE: Tenant shall at all times during the Term hereof and at its
cost and expense, maintain in effect policies of insurance covering (1) all Tenant Improvements
and/or other alterations on the Premises installed by or on behalf of Tenant, (2) all personal
property of Tenant located in or at the Premises, including, but not limited to, fixtures,
furnishings, equipment and furniture, in an amount not less than their full replacement value, and
(3) loss of income or business interruption insurance. These policies shall provide protection
against any peril included normally covered under ISO Special Forms coverage (comparable to former
“All Risk” coverage), including, but not limited to, insurance against sprinkler leakage, vandalism
and malicious mischief. The proceeds of such insurance shall be used to repair or replace the
Tenant Improvements and personal property so insured. Tenant shall, at its cost, maintain rental
abatement insurance assuring that the rent payable hereunder will be paid to Landlord for a period
of not less than twelve (12) months if rent is to abate under any provision of this Lease or
applicable law. Such coverage shall include a sixty (60) day extended period of indemnity
endorsement.



     All policies of insurance required hereunder (other than commercial general liability) shall
include a clause or endorsement denying the insurer any rights of subrogation against the other
party to the extent rights have been waived by the insured before the occurrence of injury or loss,
if same are obtainable without unreasonable cost. Landlord and Tenant each hereby waive any rights
of recovery against the other for injury or loss to such waiving party or to its property or the
property of others under its control, arising from any cause insured against under any policy of
insurance required to be carried by such waiving party under this Lease (other than commercial
general liability). The foregoing waiver shall be effective whether or not the waiving party shall
actually obtain and maintain the insurance which such waiving party is obligated to obtain and
maintain under this Lease.



     All insurance required to be provided by Tenant under this Lease: (a) shall be issued by
insurance companies authorized to do business in the state in which the Premises are located and
holding a General Policyholders Rating of “A” and a Financial Rating of “X” or better, as set forth
in the most recent edition of Best’s Insurance Reports; and (b) shall contain an endorsement
requiring at least thirty (30) days prior written notice to Landlord and Landlord’s lender, before
cancellation or change in coverage, scope or amount of any policy. Tenant shall deliver a
certificate or copy of such policy together with evidence of payment of all current premiums to
Landlord within thirty (30) days of execution of this Lease and within fifteen (15) days of
expiration of each policy. Tenant’s failure to provide evidence of such coverage to Landlord may,
in Landlord’s sole discretion, constitute a default under this Lease.



     Subject to being reimbursed by Tenant, Landlord shall insure the Building and the Premises
Land (excluding all property which Tenant is obligated to insure) by obtaining and maintaining
property insurance for any and all reasonable risks (including (i) earthquake insurance in an
amount not to exceed the probable maximum loss and (ii) flood insurance) and public liability
insurance providing coverage in an amount of not less than $3,000,000



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and with such deductibles as Landlord considers appropriate, taking into account what
deductibles are maintained by similar institutional landlords of similar properties in the general
vicinity of the Building. Tenant shall pay, as additional rent, Tenant’s Share of the cost of any
insurance maintained by Landlord hereunder and any other insurance Landlord may reasonably elect to
obtain for the Building and/or the Premises Land from time to time during the Term (including,
without limitation, earthquake, flood, terrorism and/or environmental insurance), taking into
account the types of insurance maintained by similar institutional landlords of similar properties
in the general vicinity of the Building; provided, however, the foregoing insurance policy amounts
may be increased, and related deductibles may be increased or decreased, from time to time by
Landlord (however, not more than once per annum), taking into account what other similar
institutional landlords of similar properties in the general vicinity of the Building maintain.
Such property insurance required to be provided by Landlord will include an express waiver of
subrogation by the insurer in favor of Tenant, and will release Tenant from any claims for damage
to the Premises and to Landlord’s personal property, equipment and improvements in or on the
Premises, caused by or resulting from risks which are insured against by Landlord. Tenant shall
pay, as additional rent, Tenant’s Share of all such insurance premiums to Landlord in advance
monthly installments equal to one twelfth (1/12) of Landlord’s reasonable estimate of the insurance
premiums payable under this Lease, together with monthly installments of Basic Rent, and Landlord
shall hold such payments in a non-interest bearing account. Upon determination of the actual
insurance premium due and payable, Landlord shall determine and notify Tenant of any deficiency in
the impound account and Tenant shall pay any deficiency of funds in the impound account not less
than twenty (20) days in advance of the date such insurance premium or installment of premiums is
due and payable. In the event Landlord fails to deliver such timely deficiency determination and
notice to Tenant, then Tenant shall have twenty (20) days from receipt of such notice to remit
payment of such deficiency to Landlord. If Landlord determines that Tenant’s impound account has
accrued an amount in excess of the insurance premiums due and payable, then such excess shall be
credited to Tenant within 30-days following the date of said notice from Landlord.




     Notwithstanding any contribution by Tenant to the cost of insurance premiums as provided
herein, Tenant acknowledges that it has no right to receive any proceeds from any insurance
policies carried by Landlord.



17. DESTRUCTION.




     (a) Casualty. If during the Term of this Lease, any portion of the Premises, access
to the Premises or any part of the Building which is essential to the use of the Premises is
damaged or destroyed and such damage or destruction can, in Landlord’s contractor’s reasonable
estimation, be repaired within 270 days following such damage or destruction, and Landlord receives
insurance proceeds sufficient to restore such damage, then this Lease shall remain in full force
and effect and Landlord shall promptly commence to repair and restore the damage or destruction to
substantially the same condition as existed prior to such damage and shall complete such repair and
restoration with due diligence in compliance with all then existing laws. Notwithstanding the
foregoing, if (1) such damage or destruction cannot, in Landlord’s contractor’s reasonable
estimate, be repaired within 270 days following such damage or destruction; or (2) more than forty
percent (40%) of the Building is damaged or destroyed; or (3) any Mortgagee of the Building will
not allow the application of insurance proceeds for repair and restoration; or (4) the damage or
destruction is not covered in full by Landlord’s Insurance required by Paragraph 16, subject to the
deductible, or (5) the damage or destruction occurs within the last twelve (12) months of the Term
of this Lease or any extension hereof, then Landlord may, in its sole discretion, terminate this
Lease by delivery of notice to Tenant within 30 days of the date Landlord learns of the damage.
Further notwithstanding the foregoing, if (i) such damage or destruction cannot, in Landlord’s
contractor’s reasonable estimate, be repaired within 270 days following such damage or destruction,
or (ii) such damage or destruction is not fully repaired within twelve (12) months following the
date of such damage or destruction, extended to the extent of any delays caused by Tenant and any
delays of force majeure, or (iii) the damage or destruction occurs within the last twelve (12)
months of the Term of this Lease or any extension hereof, then Tenant may, in its sole discretion,
terminate this Lease by delivery of notice to Landlord within 30 days of the date of the damage (if
Tenant is exercising its right to terminate for the reason set forth in clauses (i) or (iii)
above), or within 10 days of the date of the damage (if Tenant is exercising its right to terminate
for the reason set forth in clause (ii) above).



     (b) Rent Abatement. In the event of repair, reconstruction and restoration by
Landlord as herein provided, the rent payable under this Lease shall be abated proportionately to
the extent any portion of the Premises is rendered untenantable during the period of such repair,
reconstruction or restoration; provided that there shall be no abatement of rent if such damage is
the result of Tenant’s negligence or intentional wrongdoing. Tenant shall not be entitled to any
compensation or damages for loss in the use of the whole or any part of the Premises, damage to
Tenant’s personal property and/or any inconvenience or annoyance occasioned by such damage, repair,
reconstruction or restoration.



     (c) Repair or Restoration. If Landlord is obligated to or elects to repair or restore
as herein provided, Landlord shall be obligated to make repair or restoration only to those
portions of the Building and the Premises which were originally provided at Landlord’s expense, and
the repair and restoration of items not provided at Landlord’s expense shall be the obligation of
Tenant. Tenant agrees to coordinate the restoration and repair of those items it is required to
restore or repair with Landlord’s repair and restoration work and in accordance with a work
schedule prepared by Landlord, or Landlord’s contractor. Further, Tenant’s work shall be performed
in accordance with the terms, standards and conditions contained in Paragraph 14 above.



     (d) Waiver. The provisions of California Civil Code Section 1932, Subsection 2, and
Section 1933, Subsection 4, and any other similarly enacted statute or court decision relating to
the abatement or termination of a lease upon destruction of the leased premises, are hereby waived
by Tenant; and the provisions of this Paragraph 17 shall govern in case of such destruction.



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18. CONDEMNATION.




     (a) Definitions. The following definitions shall apply: (1) “Condemnation” and/or
“Taking” means (a) the exercise of any governmental power of eminent domain, whether by legal
proceedings or otherwise by condemnor, or (b) the voluntary sale or transfer by Landlord to any
condemnor either under threat of condemnation or while legal proceedings for condemnation are
proceeding; (2) “Date of Taking” means the date the condemnor has the right to possession of the
property being condemned; (3) “Award” means all compensation, sums or anything of value awarded,
paid or received on a total or partial condemnation; and (4) “Condemnor” means any public or
quasi-public authority, or private corporation or individual, having a power of condemnation.



     (b) Obligations to be Governed by Lease. If during the Term of this Lease there is
any Taking of all or any part of the Premises, the rights and obligations of the parties shall be
determined pursuant to this Lease.



     (c) Total or Partial Taking. If the Premises is taken in its entirety by
condemnation, this Lease shall terminate on the date of Taking. If any portion of the Premises is
taken by condemnation, this Lease shall remain in effect, except that Tenant may elect to terminate
this Lease if the remaining portion of the Premises is rendered unsuitable for Tenant’s continued
use of the Premises. If Tenant elects to terminate this Lease, Tenant must exercise its right to
terminate by giving notice to Landlord within 20 days after receipt of notice of the Taking from
Landlord. If Tenant elects to terminate this Lease, Tenant shall also notify Landlord of the date
of termination, which date shall not be earlier than 30 days nor later than 90 days after Tenant
has notified Landlord of its election to terminate; except that this Lease shall terminate on the
date of Taking if the date of Taking falls on a date before the date of termination as designated
by Tenant. If any portion of the Premises is taken by condemnation and this Lease remains in full
force and effect, on the date of taking the rent shall be reduced by an amount in the same ratio as
the total number of square feet in the portion of the Premises taken bears to the total number of
square feet in the Premises immediately before the Date of Taking. In the case where a portion of
the Premises is taken and the Lease remains in full force and effect, Landlord shall, at its own
cost and expense, to the extent of condemnation proceeds, make all alterations or repairs to the
Building so as to make the portion of the Building not taken a complete architectural unit. Such
work shall not, however, exceed the scope of work done by Landlord in originally constructing the
Building. If severance damages from the condemnor are not available to Landlord in sufficient
amounts to permit such restoration, Landlord may terminate this Lease upon written notice to
Tenant. Rent due and payable hereunder shall be temporarily abated during such restoration period
in proportion to the extent to which there is substantial interference with Tenant’s use of the
Premises, as reasonably determined by Tenant and Landlord. Each party hereby waives the provisions
of Section 1265.130 of the California Code of Civil Procedure and any present or future law
allowing either party to petition the Superior Court to terminate this Lease in the event of a
partial taking of the Building or Premises.



     If the Premises are totally or partially taken by condemnation, Tenant shall not assert any
claim against Landlord or the condemnor for any compensation because of such Taking, and Landlord
shall be entitled to receive the entire amount of the award without any deduction for any estate or
interest of Tenant; provided, however, Tenant shall, so long as the same does not work to reduce
Landlord’s award, have the right to file any claim available to Tenant under applicable law for any
taking of any leasehold improvements paid for by Tenant (which may include any improvements paid
for from any allowance provided by Landlord) and of any trade fixtures and personal property of
Tenant, for interruption in Tenant’s business, and/or for moving and relocation expenses, fees of
consultants, brokers, attorneys and other professionals incurred by Tenant in connection with
moving to another location.



19. ASSIGNMENT OR SUBLEASE.




     Tenant shall not assign or encumber its interest in this Lease or any portion of the Premises
or sublease all or any part of the Premises or allow any other person or entity (except Tenant’s
authorized representatives, employees, invitees, or guests) to occupy or use all or any part of the
Premises without first obtaining Landlord’s consent, which consent shall not be unreasonably
withheld, conditioned or delayed. In addition to any other reasonable grounds upon which Landlord
may withhold its consent, Landlord shall be deemed reasonable in withholding its consent if it
determines in its sole discretion that: (i) the tangible net worth of the proposed assignee or
sublessee, as shown on its most recently published, audited financial statement (or, if no such
statement exists, as certified by its chief financial officer), is not equal to or greater than Two
Hundred Million and No/100 Dollars ($200,000,000.00); (ii) the intended uses of the Premises by the
proposed assignee or sublessee will either (a) constitute a violation of this Lease or any
governmental law, rule, ordinance or regulation governing the Premises or (b) involve the storage,
use or keeping of Hazardous Materials in, on or about the Premises in violation of the terms of
this Lease, or (c) will require an alteration of the Premises in violation of the terms of this
Lease; or (iii) the proposed assignee or sublessee is a tenant of Landlord in the Project or has
negotiated to be a tenant of Landlord in the Project any time in the six (6) months just preceding
Tenant’s request for Landlord’s consent. Any assignment, encumbrance or sublease without
Landlord’s written consent shall be voidable and at Landlord’s election, shall constitute a default
hereunder. Landlord’s waiver or consent to any assignment or subletting shall not relieve Tenant
or any assignee or sublessee from any obligation under this Lease whether or not accrued.



     If Tenant is a partnership, a withdrawal or change, voluntary, involuntary or by operation of
law of any partner, or the dissolution of the partnership, shall be deemed a voluntary assignment.
If Tenant is a corporation, any dissolution, merger, consolidation or other reorganization of
Tenant, or sale or other transfer of a controlling percentage of the capital stock of Tenant, or
the sale of at least 50% of the value of the assets of Tenant shall be deemed a voluntary
assignment. The phrase “controlling percentage” means ownership of and right to vote stock
possessing at least 50% of the total combined voting power of all classes of Tenant’s capital stock
issued, outstanding and entitled to vote for election of directors. The preceding two sentences of
this paragraphs shall not apply to corporations the stock of which is traded through a public
exchange. If Landlord shall consent to any



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assignment or sublease of this Lease, 50% of all sums and other consideration payable to or
for the benefit of the Tenant from its assignees or subtenants in excess of the rent payable by
Tenant to Landlord under this Lease shall be paid to Landlord, as and when such sums are due and
payable.




     If Tenant requests Landlord’s consent to an assignment or sublease, Tenant shall submit to
Landlord, in writing, the name of the proposed assignee or subtenant and the nature and character
of the business of the proposed assignee or subtenant, the term, use, rental rate and all other
material terms and conditions of the proposed assignment or sublease, including, without
limitation, evidence satisfactory to Landlord that the proposed assignee or subtenant satisfies the
financial criteria set forth in the first paragraph of this Paragraph 19, thirty (30) days prior to
the proposed effective date of such assignment or sublease. Tenant shall also submit to Landlord a
processing fee of One Thousand Dollars ($1,000.00) as a condition to Landlord reviewing Tenant’s
proposed assignment or subletting materials. Landlord shall within ten (10) business days after
Landlord’s receipt of such written request and information either (i) consent to or refuse to
consent to such assignment or sublease in writing (but no such consent to an assignment or sublease
shall relieve Tenant or any guarantor of Tenant’s obligations under this Lease of any liability
hereunder), (ii) in the event of a proposed assignment of this Lease or a proposed sublease of the
entire Premises for the entire remaining Term of this Lease, terminate this Lease effective the
first to occur of ninety (90) days following written notice of such termination or the date that
the proposed assignment or proposed sublease would have come into effect. If Landlord should fail
to notify Tenant in writing of its decision within such ten (10) business day period after the
later of the date Landlord is notified in writing of the proposed assignment or sublease or the
date Landlord has received all required information concerning the proposed assignee or subtenant
and the proposed assignment or sublease, Landlord shall be deemed to have refused to consent to
such assignment or sublease, and to have elected to keep this Lease in full force and effect;
provided, however, if Landlord shall be deemed to have refused to consent to such assignment or
sublease as stated in this sentence above, Tenant may deliver to Landlord an additional request for
Landlord’s consent to such assignment or sublease (“Tenant’s Additional Assignment/Subletting
Notice”). In the event Landlord fails to either approve or disapprove such assignment or sublease
in accordance with the terms of this Lease within two (2) business days following Landlord’s
receipt of Tenant’s Additional Assignment/Subletting Notice, Landlord shall be deemed to have
granted its consent to such assignment or sublease. Tenant acknowledges that the Tenant’s
Additional Assignment/Subletting Notice will not be deemed given to Landlord unless the same
contains the following language (in at least 12 point, bold face and all capital letters):
"LANDLORD’S FAILURE TO EITHER APPROVE OR DISAPPROVE SUCH ASSIGNMENT OR SUBLEASE IN ACCORDANCE WITH
THE TERMS OF THIS LEASE WITHIN TWO (2) BUSINESS DAYS FOLLOWING RECEIPT OF THIS NOTICE MAY RESULT IN
LANDLORD BEING DEEMED TO HAVE CONSENTED TO SUCH ASSIGNMENT OR SUBLEASE PURSUANT TO PARAGRAPH 19 OF
THE LEASE”. If Tenant requests Landlord’s consent to any such assignment or sublease, the
assignment shall be on a form reasonably acceptable to Landlord, and Tenant shall pay Landlord,
whether or not consent is ultimately given, any reasonable attorneys’ fees and other costs incurred
in connection with the preparation, review and/or approval of such documentation.



     No interest of Tenant in this Lease shall be assignable by involuntary assignment through
operation of law (including, without limitation, the transfer of this Lease by testacy or
intestacy). Each of the following acts shall be considered an involuntary assignment: (a) If
Tenant is or becomes bankrupt or insolvent, makes an assignment for the benefit of creditors, or
institutes proceedings under the Bankruptcy Act in which Tenant is the bankrupt; or if Tenant is a
partnership or consists of more than one person or entity, if any partner of the partnership or
other person or entity is or becomes bankrupt or insolvent, or makes an assignment for the benefit
of creditors; or (b) If a writ of attachment or execution is levied on this Lease; or (c) If in any
proceeding or action to which Tenant is a party, a receiver is appointed with authority to take
possession of the Premises. An involuntary assignment shall constitute a default by Tenant and
Landlord shall have the right to elect to terminate this Lease, in which case this Lease shall not
be treated as an asset of Tenant.



     No assignment or subletting, occupancy or collection of rent from any proposed assignee or
sublessee shall be deemed a waiver on the part of Landlord, or the acceptance of the applicable
assignee or sublessee, as applicable, as Tenant, and no such assignment or subletting shall release
Tenant of Tenant’s obligations under this Lease or alter the primary liability of Tenant to pay
rent and to perform all other obligations to be performed by Tenant hereunder. Landlord may
require that any assignee or sublessee remit directly to Landlord on a monthly basis, all monies
due Tenant by said assignee or sublessee, and each sublease shall provide that if Landlord gives
said sublessee written notice that Tenant is in default under this Lease, said sublessee will
thereafter make all payments due under the sublease directly to or as directed by Landlord, which
payments will be credited against any payments due under this Lease. Tenant hereby irrevocably and
unconditionally assigns to Landlord all rents and other sums payable under any sublease of the
Premises; provided, however, that Landlord hereby grants Tenant a license to collect all such rents
and other sums so long as Tenant is not in default under this Lease. Consent by Landlord to one
assignment or subletting shall not be deemed consent to any subsequent assignment or subletting.
In the event of default by any assignee or sublessee of Tenant or any successor of Tenant in the
performance of any of the terms hereof, Landlord may proceed directly against Tenant without the
necessity of exhausting remedies against such assignee or sublessee or successor. Landlord may
consent to subsequent assignments of the Lease or sublettings or amendments or modifications to the
Lease with assignees of Tenant, without notifying Tenant, or any successor of Tenant, and without
obtaining its or their consent thereto and any such actions shall not relieve Tenant of liability
under this Lease; provided, however, the foregoing is not intended to render any such subsequent
assignment or sublease effective, but rather to permit Landlord to execute any counterpart consent
without first confirming that Tenant has consented to such assignment and/or sublease. Tenant
hereby waives (for itself and all persons claiming under Tenant) the provisions of Civil Code
Section 1995.310.



     Notwithstanding the terms of this Paragraph 19, Tenant may effect an assignment or subletting,
without Landlord’s consent, to any parent, subsidiary or affiliate entity which controls, is
controlled by, or is under common control with, Tenant, or to any entity resulting from a merger or
consolidation of Tenant, or to any person or entity



- 14 -









 




which acquires all or substantially all of the assets of Tenant’s business as a going concern
(a “Permitted Transferee”), provided that (a) Tenant delivers to Landlord, at least thirty (30)
days prior to such transfer, written notice of same (unless such notice would violate applicable
security laws and Landlord is unwilling to sign a non-disclosure statement), (b) the assignee (if
applicable) assumes in full the obligations of Tenant under this Lease arising after the effective
date of the transfer, and (c) Tenant remains fully liable under this Lease (provided Tenant shall
not be required to continue its existence for the sole purpose of complying with this clause (c) if
this Lease would be Tenant’s only remaining liability and such transfer is not otherwise used as a
subterfuge to avoid Tenant’ obligations hereunder).




20. DEFAULT.




     The occurrence of any of the following shall constitute a default by Tenant under this Lease:
(a) A failure to pay rent or any other charge within five (5) calendar days after receipt of
written notice of such failure from Landlord, provided Landlord shall only be obligated to provide
such a written notice once during any twelve (12) month period and thereafter during such twelve
(12) month period the failure to pay rent or other charge within five (5) calendar days of when due
shall automatically constitute a default by Tenant hereunder; (b) Abandonment of the Premises
(failure to occupy and operate the Premises for thirty (30) consecutive days without paying rent
shall be deemed an abandonment); (c) The making by Tenant of any general assignment for the benefit
of creditors; the filing by or against Tenant of a petition to have Tenant adjudged a bankrupt or a
petition for reorganization or arrangement under any law relating to bankruptcy (unless, in the
case of a petition filed against Tenant, the same is dismissed within forty-five (45) days; the
appointment of a trustee or receiver to take possession of substantially all of Tenant’s assets
located at the Premises or of Tenant’s interest in this Lease, or of substantially all of Tenant’s
assets located at the Premises or of Tenant’s interest in this Lease, where possession is not
restored to Tenant within forty-five (45) days; the attachment, execution or other judicial seizure
of substantially all of Tenant’s assets located at the Premises or of Tenant’s interest in this
Lease where such seizure is not discharged within forty-five (45) days; or if this Lease shall, by
operation of law or otherwise, pass to any person or persons other than Tenant except as provided
in Paragraph 19 herein; (d) The failure of Tenant to timely comply with the provisions of
Paragraph 24 or Paragraph 31 of this Lease regarding, respectively, Subordination and Estoppel
Certificates; or (e) The failure of Tenant to perform any other provision of this Lease within
thirty (30) days following receipt of written request from Landlord, provided, if the nature of
Tenant’s obligation is such that more than thirty (30) days is required for performance, then
Tenant shall not be in default under this clause (e) if Tenant commences performance within such
thirty (30) day period and thereafter diligently prosecutes the same to completion.



21. LANDLORD’S REMEDIES.




     Landlord shall have the remedies described in this Paragraph 21 if Tenant is in default
hereunder. These remedies are not exclusive; they are cumulative and in addition to any remedies
now or later allowed by law (including, without limitation, to the extent the Premises are located
in California, the remedies of Civil Code Section 1951.4 and any successor statute or similar law,
which provides that Landlord may continue this Lease in effect following Tenant’s breach and
abandonment and collect rent as it falls due, if Tenant has the right to sublet or assign, subject
to reasonable limitations).



     Upon any default by Tenant, Landlord may:



     (a) Maintain this Lease in full force and effect and recover the rent and other monetary
charges as they become due, without terminating Tenant’s right to possession irrespective of
whether Tenant shall have abandoned the Premises. If Landlord elects not to terminate this Lease,
Landlord shall have the right to attempt to relet the Premises at such rent and upon conditions,
and for such a term, and to do all acts necessary to maintain or preserve the Premises, as Landlord
deems reasonable and necessary, without being deemed to have elected to terminate this Lease,
including re-entering the Premises to make repairs or to maintain or modify the Premises, and
removing all persons and property from the Premises; such property may be removed and stored in a
public warehouse or elsewhere at the cost of and for the account of Tenant. Reletting may be for a
period shorter or longer than the remaining Term of this Lease, and for more or less rent, but
Landlord shall have no obligation to relet at less than prevailing market rental rates. If
reletting occurs, this Lease shall terminate automatically when the new tenant takes possession of
the Premises. Notwithstanding that Landlord fails to elect to terminate the Lease initially,
Landlord at any time thereafter may elect to terminate the Lease by virtue of any previous uncured
default by Tenant. In the event of any such termination, Landlord shall be entitled to recover
from Tenant all damages incurred by Landlord by reason of Tenant’s default, as well as all costs of
reletting, including, without limitation, brokerage commissions and/or finder’s fees, attorneys’
fees, and restoration or remodeling costs.



     (b) Terminate Tenant’s right to possession by any lawful means, in which case this Lease shall
terminate and Tenant shall immediately surrender possession of the Premises to Landlord. In such
event Landlord shall be entitled to recover from Tenant all damages incurred by Landlord by reason
of Tenant’s default including, without limitation thereto, the following: (i) the worth, at the
time of award, of any unpaid rent which had been earned at the time of such termination; plus
(ii) the worth, at the time of award, of the amount by which the unpaid rent which would have been
earned after termination until the time of award exceeds the amount of such rental loss that Tenant
proves could have been reasonably avoided; plus (iii) the worth, at the time of award, of the
amount by which the unpaid rent for the balance of the Term after the time of award exceeds the
amount of such rental loss that Tenant proves could have been reasonably avoided; plus (iv) any
other amount, and court costs, necessary to compensate Landlord for all the detriment proximately
caused by Tenant’s default or which in the ordinary course of things would be likely to result
there from (including, without limiting the generality of the foregoing, the amount of any
brokerage commissions and/or finder’s fees for a replacement tenant, maintaining the Premises after
such default, and preparing the Premises for reletting); plus (v) at Landlord’s election, such
other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by
applicable law. As used in (i) and (ii) above,



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the “worth at the time of the award” is computed by allowing interest at the Interest Rate.
As used in (iii) above, the “worth at the time of the award” is computed by discounting such amount
at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award plus one
percent (1%). Tenant hereby waives for Tenant and all those claiming under Tenant all rights now
or hereafter existing, including, without limitation, any rights under California Code of Civil
Procedure Sections 1174 and 1179 and Civil Code Section 1950.7 to redeem by order or judgment of
any court or by any legal process or writ, Tenant’s right of occupancy of the Premises after any
termination of this Lease.




     (c) Collect sublease rents (or appoint a receiver to collect such rents) and otherwise perform
Tenant’s obligations at the Premises, it being agreed, however, that neither the filing of a
petition for the appointment of a receiver for Tenant nor the appointment itself shall constitute
an election by Landlord to terminate this Lease.



     (d) Proceed to cure the default at Tenant’s sole cost and expense. If at any time Landlord
pays any sum or incurs any expense as a result of or in connection with curing any default of
Tenant, the amount thereof shall be deemed additional rent hereunder and shall be immediately due
and payable by Tenant to Landlord upon demand.



     (e) Subject to the rights of any third party lenders, retain possession of all Tenant’s
fixtures, furniture, equipment, improvements, additions, and other personal property in the
Premises and, continue during the length of said default, to use same, rent or charge free, until
all defaults are cured; or, upon the termination of this Lease, to require Tenant to forthwith
remove same at Tenant’s sole cost and expense.



     (f) Pursue any and all other legal or equitable remedies as may be available to Landlord by
reason of such default by Tenant.



     The remedies of Landlord, as hereinabove provided, are cumulative and in addition to and not
exclusive of any other remedy of Landlord herein given or which may be permitted by law. The
remedies of Landlord, as hereinabove provided, are subject to the other provisions herein. Nothing
contained in this Paragraph 21 shall constitute a waiver of Landlord’s right to recover damages by
reason of Landlord’s efforts to mitigate the damage to it caused by Tenant’s default; nor shall
anything herein adversely affect Landlord’s right, as in this Lease elsewhere provided, to
indemnification against liability for injury or damage to persons or property occurring prior to
the termination of this Lease.



22. DEFAULT BY LANDLORD.




     Landlord shall not be in default hereunder unless Landlord fails to perform the obligations
required of Landlord within thirty (30) days after written notice by Tenant to Landlord and to any
Mortgagee or Ground Lessor (as defined in Subparagraph 34(m) below) specifying wherein Landlord has
failed to perform such obligation; provided, however, that if the nature of Landlord’s obligation
is such that more than thirty (30) days is required for performance, then Landlord shall not be in
default if Landlord commences performance within such thirty (30) day period and thereafter
diligently prosecutes the same to completion. In no event shall Tenant have the right to terminate
this Lease as a result of Landlord’s default; Tenant’s remedies shall be limited to any other
remedy available at law or in equity; provided, however, notwithstanding anything herein to the
contrary, under no circumstances shall Landlord be liable hereunder to Tenant for any consequential
damages or for loss of business, revenue, income or profits and Tenant hereby waives any and all
claims for any such damages. Except as expressly provided in this Paragraph 22 below, nothing
herein contained shall be interpreted to mean that Tenant is excused from paying rent due hereunder
as a result of any default by Landlord.



     Notwithstanding anything to the contrary contained in this Lease, if Landlord fails to perform
any of its repair and/or maintenance obligations under Paragraph 13(b) of this Lease and does not
cure such default within the time period provided above, then Tenant shall be permitted to perform
such repair and/or maintenance obligation on Landlord’s behalf and at Landlord’s sole cost and
expense, provided Tenant first delivers to Landlord an additional two (2) business days prior
written notice (“Tenant’s Self-Help Notice”) that Tenant will be performing such obligations, and
provided Landlord fails to commence such cure within such additional two (2) business day period.
Tenant acknowledges that Tenant’s Self-Help Notice will not be deemed given to Landlord unless the
same contains the following language (in at least 12 point, bold face and all capital letters):
"LANDLORD’S FAILURE TO PERFORM THE HEREIN DESCRIBED REPAIR AND/OR MAINTENANCE OBLIGATION WITHIN
TWO (2) BUSINESS DAYS FOLLOWING RECEIPT OF THIS LETTER MAY RESULT IN TENANT EXERCISING ITS
SELF-HELP RIGHT PURSUANT TO PARAGRAPH 22 OF THE LEASE”. Any such cure by Tenant of a default by
Landlord under Subparagraph 13(b) above shall be performed in accordance with provisions of
Subparagraph 14(b) of this Lease. Landlord agrees to reimburse Tenant, within thirty (30) days
following Landlord’s receipt of a written statement, for all reasonable and actual costs incurred
by Tenant in performing such obligations on behalf of Landlord. If Landlord fails to pay such
amount prior to the expiration of such thirty (30) day period, Tenant may at its election bring an
arbitration action for damages against Landlord on account thereof (an “Action”) in accordance with
the terms of Rider 2 attached to this Lease. In the event Tenant is able to obtain a monetary
judgment against Landlord from the arbitrator in connection with said Action (the “Judgment”) and
Landlord fails to pay the amount of such Judgment (the “Judgment Amount”) within thirty (30) days
following entry of such Judgment, then and only then shall Tenant have the right to offset the
Judgment Amount against up to fifty percent (50%) of any monthly installment of Basic Rent next due
Landlord and any succeeding monthly installments of Basic Rent until fully satisfied from such
offset.



23. ENTRY OF PREMISES AND PERFORMANCE BY TENANT.




     Landlord and its authorized representatives shall have the right, upon 24-hours advance notice
(emergencies excepted, in which case no prior notice shall be necessary), to enter the Premises at
all reasonable



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times for any of the following purposes without abatement of rent or liability to Tenant:
(a) To determine whether the Premises is in good condition and whether Tenant is complying with its
obligations under this Lease; (b) To do any necessary maintenance and to make any restoration to
the Premises or the Building that Landlord has the right or obligation to perform; (c) To post “for
sale” signs at any time during the Term, to post “for rent” or “for lease” signs during the last
twelve (12) months of the Term, or during any period while Tenant is in default; (d) To show the
Premises to prospective brokers, agents, buyers, tenants or persons interested in an exchange, at
any time during the Term; (e) To repair, maintain or improve the Premises and to erect scaffolding
and protective barricades around and about the Premises but not so as to prevent entry to the
Premises and to do any other act or thing necessary for the safety or preservation of the Premises;
or (f) To discharge Tenant’s obligations hereunder when Tenant has failed to do so in accordance
with the terms of this Lease. So long as Landlord uses its commercially reasonable efforts not to
interfere with Tenant’s operation at the Premises, Landlord shall not be liable in any manner for
any inconvenience, disturbance, loss of business, nuisance or other damage arising of out
Landlord’s entry onto the Premises as provided in this Paragraph 23. Tenant shall not be entitled
to an abatement or reduction of rent if Landlord exercises any rights reserved in this
Paragraph 23. For each of these purposes, Landlord shall at all times have and retain a key with
which to unlock all the doors in, upon and about the Premises. Notwithstanding anything to the
contrary in this Section 23 or elsewhere in the Lease, Landlord hereby acknowledges that
(A) certain portions of the Premises will not be accessible by Landlord due to either (i) the
proprietary nature of the activities occurring therein and/or (ii) applicable rules, regulations
and laws, including those enforced by the FDA, (B) Tenant shall have the right to have an escort
accompany Landlord during any Landlord entry upon the Premises, and (C) all Landlord entries upon
the Premises shall be subject to any laws and/or regulations issued by the FDA and/or any other
applicable governmental authority with jurisdiction over Tenant’s operations at the Premises for
the Specific Use of which Landlord is aware or is made aware of by Tenant.




     All covenants and agreements to be performed by Tenant under any of the terms of this Lease
shall be performed by Tenant at Tenant’s sole cost and expense without any abatement of rent. If
Tenant shall fail to pay any sum of money to any third party which Tenant is obligated to pay under
this Lease or shall fail to perform any other act on its part to be performed hereunder, and such
failure shall continue for twenty (20) days after notice thereof by Landlord (or such other period
as specifically provided herein), Landlord may, without waiving or releasing Tenant from any
obligations of Tenant, but shall not be obligated to, make any such payment or perform any such
other act on Tenant’s part to be made or performed in this Lease, without liability to Tenant for
any loss or damage which might occur to Tenant’s merchandise, fixtures or other property or to
Tenant’s business by reason thereof, and upon completion thereof, Tenant shall pay to Landlord all
sums so paid by Landlord and all necessary incidental costs for making such repairs plus ten
percent (10%) for overhead, upon presentation of a bill therefor. Said bill shall include interest
on all sums so paid by Landlord and all necessary incidental costs for making such repairs at the
Interest Rate, from the date of such payment by Landlord. Tenant covenants to pay any such sums to
Landlord upon demand, and Landlord shall have (in addition to all other rights or remedies of
Landlord) the same rights and remedies in the event of the nonpayment thereof by Tenant as in the
case of default by Tenant in the payment of rent.



24. SUBORDINATION.




     Without the necessity of any additional document being executed by Tenant for the purpose of
effecting a subordination, and unless otherwise elected by Landlord or any Mortgagee (defined
below) with a lien on the Premises or any Ground Lessor (defined below) with respect to the
Premises (or any part thereof), this Lease shall be subject and subordinate at all times to (a) all
ground leases or underlying leases which may now exist or hereafter be executed affecting the
Premises, or the land upon which the Premises is situated, or both, and (b) the lien of any
mortgage or deed of trust which may now exist or hereafter be executed in any amount for which the
Premises, ground leases or underlying leases, or Landlord’s interest or estate in any of said items
is specified as security. Notwithstanding the foregoing, Tenant acknowledges that Landlord shall
have the right to subordinate or cause to be subordinated this Lease to any such ground leases or
underlying leases or any such liens. In the event that any ground lease or underlying lease
terminates for any reason or any mortgage or deed of trust is foreclosed or a conveyance in lieu of
foreclosure is made for any reason, Tenant shall, notwithstanding any subordination, attorn to and
become the tenant of the successor in interest to Landlord, at the option to such successor in
interest. Tenant covenants and agrees to execute and deliver, upon demand by Landlord and in the
form requested by Landlord any additional documents evidencing the priority or subordination of
this Lease with respect to any such ground lease or underlying leases or the lien of any such
mortgage or deed of trust. Tenant and Landlord each agree to be responsible for its own attorneys’
fees and costs incurred in connection with any negotiation or modification of Landlord’s lender’s
standard subordination agreement form.



     Further notwithstanding the foregoing, Tenant’s obligation to subordinate this Lease and/or to
attorn to any such future Mortgagee or Ground Lessor shall be conditioned upon Landlord, Tenant and
any such future Mortgagee or Ground Lessor entering into a subordination, nondisturbance and
attornment agreement on such future Mortgagee’s or Ground Lessor’s standard form (with commercially
reasonable changes requested by Tenant), providing, among other things, that in the event of any
foreclosure of such lien or conveyance of the Premises in lieu of foreclosure, (A) Tenant will not
be disturbed in its possession of the Premises, so long as Tenant is not in default under this
Lease, and (B) Tenant shall attorn to and recognize such lienholder or purchaser at foreclosure and
their successors and assigns as the “Landlord” under this Lease from and after the date of such
foreclosure or conveyance in lieu of foreclosure.



25. NOTICE.




     Any notice, demand, request, consent, approval or communication desired by either party or
required to be given, shall be in writing and served personally or sent prepaid by commercial
overnight courier or prepaid certified first class mail (return receipt requested), addressed as
set forth in Subparagraphs 1(b) and 1(c). Either party may



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change its address by notification to the other party. Notice shall be deemed to be
communicated seventy-two (72) hours from the time of mailing (if sent via first class mail), or at
the time of service if sent by other than first class mail as provided in this Paragraph 25.




     26. WAIVER.



     No delay or omission in the exercise of any right or remedy by Landlord shall impair such
right or remedy or be construed as a waiver. No act or conduct of Landlord, including, without
limitation, acceptance of the keys to the Premises, shall constitute acceptance of the surrender of
the Premises by Tenant before the expiration of the Term. Only written notice from Landlord to
Tenant shall constitute acceptance of the surrender of the Premises and accomplish termination of
this Lease. Landlord’s consent to or approval of any act by Tenant requiring Landlord’s consent or
approval shall not be deemed to waive or render unnecessary Landlord’s consent to or approval of
any subsequent act by Tenant. Any waiver by Landlord of any default must be in writing and shall
not be a waiver of any other default concerning the same or any other provision of this Lease.



27. LIMITATION OF LIABILITY.




     In consideration of the benefits accruing hereunder, Tenant and all successors and assigns of
Tenant covenant and agree that, in the event of any actual or alleged failure, breach or default
hereunder by Landlord or otherwise pertaining to any obligation of Landlord with respect to the
Building:



     (a) The liability of Landlord and/or any Landlord Indemnified Parties shall be limited solely
and exclusively to Landlord’s interest in the Building;



     (b) No member, partner, officer, director, owner, shareholder or advisor of Landlord shall be
sued or named as a party in any suit or action (except as may be necessary to secure jurisdiction
of the entity in question);



     (c) No service of process shall be made against any member, partner, officer, director, owner,
shareholder or advisor of Landlord (except as may be necessary to secure jurisdiction of the entity
in question);



     (d) No member, partner, officer, director, owner, shareholder or advisor of Landlord shall be
required to answer or otherwise plead to any service of process;



     (e) No judgment may be taken against any member, partner, officer, director, owner,
shareholder or advisor of Landlord;



     (f) Any judgment taken against any member, partner, officer, director, owner, shareholder or
advisor of Landlord may be vacated and set aside at any time after the fact;



     (g) No writ of execution will ever be levied against the assets of any member, partner,
officer, director, owner, shareholder or advisor of Landlord;



     (h) The obligations under this Lease do not constitute personal obligations of any individual
member, partner, officer, director, owner, shareholder or advisor of Landlord, and Tenant shall not
seek recourse against any such persons or entities of Landlord or any of their personal assets for
satisfaction of any liability in respect to this Lease; and



     (i) These covenants and agreements are enforceable both by Landlord and also by any member,
partner, officer, director, owner, shareholder or advisor of Landlord.



     Tenant agrees that each of the foregoing provisions shall be applicable to any covenant or
agreement either expressly contained in this Lease or imposed by statute or at common law.



28. FORCE MAJEURE.




     Neither Landlord nor Tenant shall have any liability whatsoever to each other on account of
(a) the inability or delay of such party in fulfilling any of its obligations under this Lease by
reason of strike, other labor trouble, terrorism, governmental controls in connection with a
national or other public emergency, or shortages of fuel, supplies or labor resulting there from or
any other cause, whether similar or dissimilar to the above, beyond Landlord’s reasonable control;
or (b) any failure or defect in the supply, quantity or character of electricity or water furnished
to the Premises, by reason of any requirement, act or omission of the public utility or others
furnishing the Premises with electricity or water, or for any reason, whether similar or dissimilar
to the above, beyond its reasonable control. If this Lease specifies a time period for performance
of an obligation of Landlord or Tenant, that time period shall be extended by the period of any
delay in such party’s performance caused by any of the events of force majeure described above.
Notwithstanding the foregoing, the provisions of this Paragraph 28 will not operate to excuse
Tenant from prompt payment of rent or Landlord or Tenant from any other payments required under the
provisions of this Lease.



29. PROFESSIONAL FEES.




     (a) If Landlord should engage any professional including, without limitation, attorneys,
appraisers, accountants or environmental or other consultants for the purpose of bringing suit for
possession of the Premises, for the recovery of any sum due under this Lease, or because of the
breach of any provisions of this Lease, or for any other relief against Tenant hereunder, or in the
event of any other litigation between the parties with respect to this



- 18 -









 




Lease, then all reasonable costs and expenses including, without limitation, actual
professional fees such as appraisers’, accountants’, attorneys’ and other consultants’ fee,
incurred by the prevailing party therein shall be paid by the other party, which obligation on the
part of the other party shall be deemed to have accrued on the date of the commencement of such
action and shall be enforceable whether or not the action is prosecuted to judgment. If Landlord
employs a collection agency to recover delinquent charges, Tenant agrees to pay all collection
agency fees charged to Landlord in addition to rent, late charges, interest and other sums payable
under this Lease.




     (b) If Landlord is named as a defendant in any suit brought against Tenant in connection with
or arising out of Tenant’s occupancy hereunder, Tenant shall pay to Landlord its costs and expenses
incurred in such suit including, without limitation, its actual professional fees incurred,
including, without limitation, appraisers’, accountants’ and attorneys’ fees.



30. EXAMINATION OF LEASE.




     Submission of this instrument for examination or signature by Tenant shall not create a
binding agreement between Landlord and Tenant nor shall it constitute a reservation or option to
lease on the part of Tenant and this instrument shall not be effective as a lease and shall not
create any obligations on the part of Landlord or Tenant until this Lease has been validly executed
first by Tenant and second by Landlord, and delivered Tenant.



31. ESTOPPEL CERTIFICATE.




     (a) Within fifteen (15) days following any written request which Landlord may make from time
to time, Tenant shall execute and deliver to Landlord a statement (“Estoppel Certificate”), in a
form substantially similar to the form of Exhibit E attached hereto or in such other form as
Landlord’s lender or purchaser may reasonably require, certifying: (i) the date of commencement of
this Lease; (ii) the fact that this Lease is unmodified and in full force and effect (or, if there
have been modifications, stating the nature and date of such modifications), (iii) the date to
which the rent and other sums payable under this Lease have been paid; (iv) that there are no
current defaults under this Lease by either Landlord or Tenant except as specified in Tenant’s
statement; and (v) such other matters customarily contained in an estoppel certificate that are
requested by Landlord. Landlord and Tenant intend that any statement delivered pursuant to this
Paragraph 31 may be relied upon by any Mortgagee, beneficiary, purchaser or prospective purchaser
of the Premises or any interest therein.



     (b) Tenant’s failure to deliver such statement within such time shall be conclusive upon
Tenant (i) that this Lease is in full force and effect, without modification except as may be
represented by Landlord, (ii) that there are no uncured defaults in Landlord’s performance, and
(iii) that not more than one (1) month’s rent has been paid in advance. Tenant’s failure to
deliver said statement to Landlord within ten (10) days of receipt shall constitute a default under
this Lease and Landlord shall have the remedies provided in Paragraph 21.



     (c) Tenant hereby irrevocably appoints Landlord as Tenant’s attorney in fact, which
appointment is coupled with an interest, to act in Tenant’s name, place and stead to execute such
Estoppel Certificate on Tenant’s behalf.



32. RULES AND REGULATIONS.



     Tenant shall faithfully observe and comply with the “Rules and Regulations”, a copy of which
is attached hereto and marked Exhibit F, and all reasonable and nondiscriminatory modifications
thereof and additions thereto from time to time put into effect by Landlord. Landlord shall not be
responsible to Tenant for the violations or nonperformance by any other tenant or occupant of the
project of any of said Rules and Regulations.



33. LIENS.



     Tenant shall, within ten (10) days after receiving notice of the filing of any mechanic’s lien
for material or work claimed to have been furnished to the Premises on Tenant’s behalf or at
Tenant’s request, discharge the lien or post a bond equal to the amount of the disputed claim with
a bonding company reasonably satisfactory to Landlord. If Tenant posts a bond, it shall contest
the validity of the lien with all due diligence. Tenant shall indemnify, defend and hold Landlord
harmless from any and all losses and costs incurred by Landlord as a result of any such liens
attributable to Tenant. If Tenant does not discharge any lien or post a bond for such lien within
such ten (10) day period, Landlord may discharge such lien at Tenant’s expense and Tenant shall
promptly reimburse Landlord for all costs incurred by Landlord in discharging such lien including,
without limitation, attorneys’ fees and costs and interest on all sums expended at the Interest
Rate. Tenant shall provide Landlord with not less than ten (10) days written notice of its
intention to have work performed at or materials furnished to the Premises so that Landlord may
post appropriate notices of non-responsibility. Tenant shall pay upon demand Landlord’s attorneys’
fees and other costs incurred in connection with any request by Tenant for any subordination or
clarification of any Landlord lien right arising under this Lease or at law.



34. MISCELLANEOUS PROVISIONS.




     (a) Time of Essence. Time is of the essence of each provision of this Lease.



     (b) Successors. This Lease shall be binding on and inure to the benefit of the
parties and their successors, except as provided in Paragraph 19 herein.



- 19 -









 





     (c) Landlord’s Consent. Any consent required by Landlord under this Lease must be
granted in writing and may be withheld by Landlord in its sole and absolute discretion, unless
otherwise expressly provided herein.



     (d) Commissions. Each party represents that it has not had dealings with any real
estate broker, finder or other person with respect to this Lease in any manner, except for the
broker(s) identified in Subparagraph 1(k) above, which broker(s) Landlord agrees to pay a
commission to pursuant to the terms of a separate agreement. If Tenant has dealt with any other
person or real estate broker with respect to leasing or renting the Premises, Tenant shall be
solely responsible for the payment of any fees due said person or firm and Tenant shall hold
Landlord free and harmless and indemnify and defend Landlord from any liabilities, damages or
claims with respect thereto, including attorney’s fees and costs.



     (e) Landlord’s Successors. In the event of a sale or conveyance by Landlord of the
Premises, the same shall operate to release Landlord from any liability under this Lease, and in
such event Landlord’s successor-in-interest shall be solely responsible for all obligations of
Landlord under this Lease.



     (f) Prior Agreement or Amendments. This Lease contains all of the agreements of the
parties hereto with respect to any matter covered or mentioned in this Lease, and no prior
agreement or understanding pertaining to any such matter shall be effective for any purpose. No
provisions of this Lease may be amended except by an agreement in writing signed by the parties
hereto or their respective successors-in-interest.



     (g) Recording. Tenant shall not record this Lease or a short form memorandum thereof
without the consent of Landlord. Landlord may record a short form memorandum of this Lease and
Tenant shall execute and acknowledge such form if requested to do so by Landlord.



     (h) Severability. Any provision of this Lease which shall prove to be invalid, void
or illegal shall in no way affect, impair or invalidate any other provision hereof, and all other
provisions of this Lease shall remain in full force and effect.



     (i) No Partnership or Joint Venture. Nothing in this Lease shall be deemed to
constitute Landlord and Tenant as partners or joint venturers. It is the express intent of the
parties hereto that their relationship with regard to this Lease and the Premises be and remain
that of lessor and lessee.



     (j) Interpretation. When required by the context of this Lease, the singular shall
include the plural, and the masculine shall include the feminine and/or neuter. “Party” shall mean
Landlord or Tenant.



     (k) No Light, Air or View Easement. Any diminution or blocking of light, air or view
by any structure which may be erected on lands adjacent to the Building shall in no way affect this
Lease or impose any liability on Landlord.



     (l) Governing Law. This Lease shall be governed by and construed pursuant to the laws
of the State of California.



     (m) Mortgagee Protection. In the event of any default on the part of Landlord, Tenant
will give simultaneous notice consistent with Paragraph 25 to any beneficiary of a deed of trust,
mortgagee, or ground lessor of the Premises (“Mortgagee” or Ground Lessor”), provided Landlord has
provided to Tenant prior written notice of the existence of the same to Tenant.



     (n) WAIVER OF JURY TRIAL; JUDICIAL REFERENCE.




	 	i)	 	Jury Trial Waiver. TO THE EXTENT PERMITTED BY THEN APPLICABLE LAW,
EACH PARTY HEREBY IRREVOCABLY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND
ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH PARTY RECOGNIZES AND AGREES THAT THE
FOREGOING WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR IT TO ENTER INTO THIS AGREEMENT.
EACH PARTY REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL
COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS PARAGRAPH 34(n)(i) IS SUBJECT IN ITS ENTIRETY TO
PARAGRAPH 34(n)(ii) HEREOF.
	 
	 	ii)	 	Reference Provision. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS
AGREEMENT, UNTIL SUCH TIME (IF AT ALL) AS THE CALIFORNIA LEGISLATURE ENACTS A LAW THAT
WOULD RENDER THE JURY TRIAL WAIVER SET FORTH IN PARAGRAPH 34(n)(i) HEREOF VALID AND
ENFORCEABLE OR FOR ANY OTHER REASON A COURT OF COMPETENT JURISDICTION DETERMINES THAT
THE JURY TRIAL WAIVER SET FORTH IN PARAGRAPH 34(n)(i) HEREOF IS VALID AND ENFORCEABLE,
THE REFERENCE PROVISION CONTAINED IN EXHIBIT J HERETO SHALL APPLY TO ANY SUIT, ACTION
OR PROCEEDING COMMENCED PRIOR TO SUCH TIME IN LIEU OF THE JURY TRIAL WAIVER SET FORTH
IN PARAGRAPH 34(n)(i) HEREOF.





     (o) Intentionally Omitted.



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     (p) Counterparts. This Lease may be executed in one or more counterparts, each of
which shall constitute an original and all of which shall be one and the same agreement.



     (q) Financial Statements. Upon ten (10) days prior written request from Landlord
(which Landlord may make at any time during the Term including in connection with Tenant’s exercise
of any option to extend or other option granted to Tenant in this Lease, but no more often that two
(2) times in any calendar year, other than in the event of a default by Tenant during such calendar
year, the exercise of any option in such calendar year or in connection with Landlord’s prospective
sale or refinancing of the Building, when such limitation shall not apply), Tenant shall deliver to
Landlord (i) a current financial statement of Tenant, and (ii) financial statements of Tenant for
the two (2) years prior to the current financial statement year. Such statements shall be prepared
in accordance with generally acceptable accounting principles and certified as true in all material
respects by Tenant (if Tenant is an individual) or by an authorized officer, member/manager or
general partner of Tenant (if Tenant is a corporation, limited liability company or partnership,
respectively). Notwithstanding the foregoing, to the extent Tenant is a company whose shares of
stock are traded on a nationally recognized stock exchange, Tenant may satisfy the foregoing
financial reporting requirements by delivering or making available its or its corporate parent’s
most recent quarterly and annual reports.



35. LEASE EXECUTION.




     (a) Tenant’s Authority. If Tenant executes this Lease as a partnership or
corporation, then Tenant and the persons and/or entities executing this Lease on behalf of Tenant
represent and warrant that: (a) Tenant is a duly authorized and existing partnership or
corporation, as the case may be, and is qualified to do business in the state in which the Building
is located; (b) such persons and/or entities executing this Lease are duly authorized to execute
and deliver this Lease on Tenant’s behalf in accordance with the Tenant’s partnership agreement (if
Tenant is a partnership), or a duly adopted resolution of Tenant’s board of directors and the
Tenant’s by-laws (if Tenant is a corporation); and (c) this Lease is binding upon Tenant in
accordance with its terms.



     (b) Intentionally Omitted.


36. SECURITY. Subject to Landlord’s reasonable approval, the approval of all applicable
governmental and quasi-governmental authorities, the approval of the Pacific Gateway Owner’s
Association pursuant to the terms of the Project CC&Rs and Tenant’s compliance with the terms of
Paragraph 14 above, Tenant shall have the right, at its sole cost and expense, to secure the
Premises and/or the Building to whatever level it deems reasonably necessary for the protection of
its business. This may specifically include alarms, video surveillance and on-site security
personnel.



37. INCENTIVES. Landlord agrees to use its commercially reasonable efforts to reasonably
assist Tenant in its efforts to procure all available business and economic incentives; provided,
however, the foregoing shall not require Landlord to incur any expenses in connection with such
assistance. All incentives procured by Tenant pursuant to the terms of this Paragraph 37 shall be
for the sole benefit of Tenant.



38. QUIET ENJOYMENT. Tenant shall, subject to the terms and conditions of this Lease and
so long as Tenant is not in default hereunder beyond any applicable cure period, at all times, have
peaceful and quiet enjoyment of the Premises against any person claiming by, through or under
Landlord.




[No Further Text On This Page]




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     IN WITNESS WHEREOF, the parties have executed this Lease as of the date first above written.



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	TENANT:	 	 	 	LANDLORD:	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	DENDREON CORPORATION,	 	 	 	KNICKERBOCKER PROPERTIES, INC. XLVI,	 	 
	a Delaware corporation	 	 	 	a Delaware corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Greg Schiffman	 	 	 	By:	 	/s/ David Sears	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	Greg Schiffman	 	 	 	 	 	Name:	 	David Sears	 	 
	 

	 	 	 	 

	 	 	 	 	 	 	 	 

	 	 
	 

	 	Its:
	 	CFO	 	 	 	 	 	Its:	 	Vice President	 	 
	 

	 	 	 	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:
	 	/s/ Rick Hamm	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	   	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:	 	Rick Hamm	 	 	 	 	 	 	 	 	 	 
	 

	 	Its:
	 	SVP,
Corporate Development

		 	 	 	 	 	 	 	 	 
	 

	 	 	 	 

	 	 	 	 	 	 	 	 	 	 







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RIDER 1




OPTIONS




     This Rider 1 is attached to, made a part of, incorporated into, and amends and supplements,
that certain Standard Industrial Lease dated August 7, 2009 (the “Lease”), by and between
KNICKERBOCKER PROPERTIES, INC. XLVI, a Delaware corporation (“Landlord”), and DENDREON CORPORATION,
a Delaware corporation (“Tenant”). Landlord and Tenant agree that, notwithstanding anything
contained in the Lease to the contrary, the provisions set forth in this Rider 1 will be deemed to
be a part of the Lease and will supersede any contrary provisions in the Lease and shall prevail
and control for all purposes. All references in the Lease and in this Rider 1 to the defined term
“Lease” are to be construed to mean the Lease as amended and supplemented by this Rider 1.
Capitalized terms which are not defined in this Rider 1 have the meanings given to them in the
Lease.



1. OPTIONS TO EXTEND.




     (a) Subject to the terms of this Paragraph 1 and Paragraph 4, entitled “Options,” Landlord
hereby grants to Tenant the option (each, an “Extension Option” and collectively, the “Extension
Options”) to extend the Term of the Lease with respect to the entire Premises for up to
five (5) additional periods of five (5) years (each, an “Option Term” and collectively, the “Option
Terms”), on the same terms, covenants and conditions as provided for in the Lease during the
immediately preceding Term, except that (i) Tenant shall have no further extension rights (other
than as expressly set forth herein), and (ii) Basic Rent shall be established based on ninety-five
percent (95%) of the “fair market rental rate” for the Premises for the applicable Option Term as
defined and determined in accordance with the provisions of this Paragraph 1 below.



     (b) Each Extension Option must be exercised, if at all, by written notice (“Extension Notice”)
delivered by Tenant to Landlord no earlier than the date which is three hundred sixty (360) days,
and no later than the date which is two hundred seventy (270) days, prior to the expiration of the
immediately preceding Term of the Lease.



     (c) The term “fair market rental rate” as used in this Rider 1 shall mean the annual amount
per square foot, projected during the relevant period, that a willing, comparable, non-equity,
renewal tenant (excluding sublease and assignment transactions) would pay, and a willing,
comparable, institutional landlord of a comparable Class “A” quality industrial building located in
the greater South Bay area (“Comparison Area”) would accept, at arm’s length (what Landlord is
accepting in current transactions for the Building or other buildings in the Project may be
considered), for space comparable in size (including the existing mezzanine square footage of
approximately 13,135 square feet of space, whether or not Tenant removes the same during the Term
of the Lease) and quality as the leased area at issue taking into account the age, quality and
layout of the existing improvements in the leased area at issue and taking into account items that
professional real estate brokers customarily consider, including, but not limited to, rental rates,
industrial space availability, tenant size, tenant improvement allowances, operating expenses and
allowance, parking charges, and any other economic matters then being charged by Landlord or
lessors of such similar industrial buildings, however, not taking into account any improvements
exclusively paid for by Tenant (i.e., any improvements paid for with the Allowance shall be deemed
paid for by Landlord and not Tenant). Notwithstanding anything herein to the contrary, in no event
will Basic Rent decrease from that payable in the last year of the immediately previous Lease Term
as a result of the fair market rental rate determination provided for in this Paragraph 1.



     (d) Landlord’s determination of fair market rental rate shall be delivered to Tenant in
writing not later than sixty (60) days following Landlord’s receipt of Tenant’s Extension Notice.
Tenant will have thirty (30) days (“Tenant’s Review Period”) after receipt of Landlord’s notice of
the fair market rental rate within which to accept such fair market rental rate or to object
thereto in writing. Tenant’s failure to object to the fair market rental rate submitted by
Landlord in writing within Tenant’s Review Period will conclusively be deemed Tenant’s approval and
acceptance thereof. If Tenant objects to the fair market rental rate submitted by Landlord within
Tenant’s Review Period, then Landlord and Tenant will attempt in good faith to agree upon such fair
market rental rate using their best good faith efforts. If Landlord and Tenant fail to reach
agreement on such fair market rental rate within fifteen (15) days following the expiration of
Tenant’s Review Period (the “Outside Agreement Date”), then each party’s determination will be
submitted to appraisal in accordance with the provisions below.



     (e) (i) Landlord and Tenant shall each appoint one independent, unaffiliated real estate
broker (referred to herein as an “appraiser” even though only a broker) who has been active over
the five (5) year period ending on the date of such appointment in the leasing of comparable
industrial properties in the Comparison Area. Each such appraiser will be appointed within thirty
(30) days after the Outside Agreement Date.



          (ii) The two (2) appraisers so appointed will within fifteen (15) days of the date of the
appointment of the last appointed appraiser agree upon and appoint a third appraiser who shall be
qualified under the same criteria set forth herein above for qualification of the initial two
(2) appraisers.




          (iii) The determination of the appraisers shall be limited solely to the issue of whether
Landlord’s or Tenant’s last proposed (as of the Outside Agreement Date) new Basic Rent for the
Premises is the closest to the actual new Basic Rent for the Premises as determined by the
appraisers, taking into account the requirements of Subparagraph 1(c) and this Subparagraph 1(e)
regarding same.




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          (iv) The three (3) appraisers shall within thirty (30) days of the appointment of the third
appraiser reach a decision as to whether the parties shall use Landlord’s or Tenant’s submitted new
Basic Rent, and shall notify Landlord and Tenant thereof.




          (v) The decision of the majority of the three (3) appraisers shall be binding upon Landlord
and Tenant and neither party will have the right to reject the determination or undo the exercise
of the Extension Option. The cost of each party’s appraiser shall be the responsibility of the
party selecting such appraiser, and the cost of the third appraiser (or arbitration, if necessary)
shall be shared equally by Landlord and Tenant.




          (vi) If either Landlord or Tenant fails to appoint an appraiser within the time period in
Subparagraph 1(e)(i) herein above, the appraiser appointed by one of them shall reach a decision,
notify Landlord and Tenant thereof and such appraiser’s decision shall be binding upon Landlord and
Tenant and neither party will have the right to reject the determination or undo the exercise of
the Extension Option.




          (vii) If the two (2) appraisers fail to agree upon and appoint a third appraiser, both
appraisers shall be dismissed and the matter to be decided shall be forthwith submitted to binding
arbitration under the provisions of the American Arbitration Association.




          (viii) In the event that the new Basic Rent is not established prior to the end of the
immediately previous Term of the Lease, the Basic Rent immediately payable at the commencement of
the applicable Option Term shall be the Basic Rent paid by Tenant at the expiration of the
immediately preceding Term. Notwithstanding the above, once the fair market rental is determined
in accordance with this section, the parties shall settle any overpayment or underpayment on the
next Basic Rent payment date falling not less than thirty (30) days after such determination.



2. OPTION TO PURCHASE. Landlord is the owner of that certain real property and all
improvements thereon, including the Building (the “Landlord Property”), described in that certain
form of Agreement of Purchase and Sale and Joint Escrow Instructions, contemplated to be entered
into by and between Landlord, as seller, and Tenant, as buyer (the “Purchase Agreement”), a copy of
which is attached hereto as Schedule 1 and incorporated herein by this reference. Landlord desires
to grant an option to Tenant to acquire the Landlord Property (the “Purchase Option”) and Tenant
hereby accepts said Purchase Option upon the terms and conditions stated herein. Tenant’s Purchase
Option and the acquisition of the Landlord Property by Tenant shall be subject to Paragraph 4 below
and in accordance with the provisions of this Paragraph 2 and the Purchase Agreement.




     (a) The term of the Purchase Option shall commence on the Commencement Date and shall
terminate at 5:00 California time on that date which is thirty (30) days prior to the Purchase
Option Outside Date (defined below) (the “Purchase Option Term”). The Purchase Option must be
exercised, if at all, by written notice delivered by Tenant to Landlord no later than the
expiration of the Purchase Option Term.



     (b) The closing of the sale of the Landlord Property pursuant to this Paragraph 2 shall occur
no later than that date which is thirty-six (36) months following the Commencement Date (the
“Purchase Option Outside Date”), as such date may be extended pursuant to the express terms of the
Purchase Agreement.



     (c) If the Purchase Option is not exercised in accordance with the terms and conditions of
this Paragraph 2 prior to the expiration of the Purchase Option Term, or if the closing of the sale
of the Landlord Property shall not occur on or before the Purchase Option Outside Date (as such
date may be extended pursuant to the express terms of the Purchase Agreement), then the Purchase
Option shall automatically and immediately terminate without notice and, thereafter, Tenant shall
have no interest whatsoever in the Landlord Property pursuant to this Paragraph 2. Tenant
acknowledges that, once terminated, the Purchase Option may not be revived by any subsequent act of
Tenant.



     (d) Tenant shall have the right, at its sole cost and expense, to record a memorandum of
option to purchase, in the form attached hereto as Schedule 3, identifying (i) Tenant’s option to
purchase the Premises (as detailed in this Paragraph 2) and (ii) Tenant’s right of first offer (as
detailed in Paragraph 3 below) (the “Memorandum”).



     (e) Tenant agrees, concurrent with the execution of this Lease, to execute, acknowledge and
deliver to Landlord a “Release of Memorandum,” in the form attached hereto as Schedule 2 and
incorporated herein by this reference. Tenant agrees that Landlord shall be entitled to record the
Release of Memorandum in the event Tenant does not timely exercise either the Purchase Option or
the right of first offer to purchase or either the Purchase Option or the right of first offer to
purchase terminates as provided herein. Tenant agrees, within ten (10) days after receipt of
written request from Landlord, to execute, acknowledge and deliver any other instruments reasonably
required by Landlord or any title company to remove the cloud of the Purchase Option and/or the
right of first offer to purchase from title to the Landlord Property. In the event Tenant
exercises the Purchase Option or the right of first offer to purchase, concurrent with the “Close
of Escrow,” as such term is defined in the applicable Purchase Agreement, Landlord shall return the
original Release of Memorandum to Tenant.



     (e) The Purchase Option shall be exercised by Tenant, if at all, by Tenant delivering, prior
to the expiration of the Purchase Option Term, to “Escrow Holder,” as such term is defined in the
Purchase Agreement, Tenant’s good faith deposit in the amount of $250,000.00 (the “Deposit”) and a
duly executed counterpart of the Purchase Agreement (with a copy to Landlord), dated as of the date
of Tenant’s delivery of the Purchase Agreement to Escrow Holder. Landlord shall then deliver to
Escrow Holder (with a copy to Tenant) a duly executed counterpart of the Purchase Agreement.



 RIDER 1  




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     (f) Landlord and Tenant acknowledge and agree that if the closing of the sale of the Landlord
Property pursuant to this Paragraph 2 occurs (i) after the Commencement Date but prior to or on the
first (1st) anniversary of the Commencement Date, then the “Purchase Price”, as such
term is defined in the Purchase Agreement, shall be equal to Nineteen Million Three Hundred Twenty
Thousand and No/100 Dollars ($19,320,000.00), (ii) after the first (1st) anniversary of
the Commencement Date but prior to or on the second (2nd) anniversary of the
Commencement Date, then the “Purchase Price”, as such term is defined in the Purchase Agreement,
shall be equal to Twenty Million Two Hundred Forty Thousand and No/100 Dollars ($20,240,000.00), or
(iii) after the second (2nd) anniversary of the Commencement Date but prior to or on the
third (3rd) anniversary of the Commencement Date, then the “Purchase Price”, as such
term is defined in the Purchase Agreement, shall be equal to Twenty-Two Million Eighty Thousand and
No/100 Dollars ($22,080,000.00).



     (g) Notwithstanding anything in this Lease to the contrary, (i) under no circumstances shall
Tenant be permitted to undertake any invasive, intrusive or destructive investigation, testing or
study of the Landlord Property, including a “Phase II” environmental assessment, without in each
instance first obtaining Landlord’s written consent thereto, which consent Landlord may give,
withhold or condition in Landlord’s sole and absolute discretion, and (ii) if the Purchase
Agreement terminates solely as a result of a default by Landlord (in its capacity as “Seller” under
the Purchase Agreement) thereunder, then Tenant shall maintain the right to subsequently
re-exercise the Purchase Option at a later date subject to and in accordance with the terms of this
Paragraph 2.



     (h) Prior to Tenant’s exercise of the Purchase Option, Tenant shall obtain, at its sole cost
and expense the Title Documents (as defined in the Purchase Agreement). At any time prior to that
date which is ten (10) days prior to Tenant’s exercise of the Purchase Option, Tenant shall have
the right to deliver written notice to Landlord (the “Title Objection Notice”) specifying any title
objections or other matters in the Title Documents to which Tenant objects (collectively, “Title
Objections”). Tenant’s failure to timely deliver a Title Objection Notice shall be deemed to be
Tenant’s approval of all of the exceptions to title and other matters shown in or disclosed by the
Title Documents. Notwithstanding anything to the contrary contained herein, (A) Tenant shall not
be entitled to deliver a Title Objection Notice that is subject to any condition other than the
issuance of a title endorsement as part of the Title Policy (as defined in the Purchase Agreement),
and any title exception or other matter set forth in the Title Documents that is approved subject
to any condition other than the issuance of a title endorsement as part of the Title Policy to be
obtained by Tenant pursuant to the terms of the Purchase Agreement (as applicable, the “Title
Policy”) shall be deemed to be a Title Objection which has been objected to by Tenant and
(B) Tenant shall not be entitled to object to any matters directly or indirectly caused by or
arising through Tenant or any of the other Tenant Parties, including this Lease or any matter
arising through or as a result of occupancy of the Landlord Property by Tenant or any other Tenant
Party pursuant to this Lease. Landlord shall have a period of five (5) Business Days after
Landlord’s receipt of the Title Objection Notice to elect by written notice to Tenant (the “Title
Response Notice”) to either (aa) attempt to remove or cure (by endorsement or otherwise) at or
prior to the Closing (as defined in the Purchase Agreement) some or all of the Title Objections, or
(bb) to advise Tenant that Landlord is unable or unwilling to remove or cure (by endorsement or
otherwise) some or all of the Title Objections. Such election by Landlord shall be at Landlord’s
sole option and discretion; it being understood Landlord has no obligation to remove or cure any
Title Objections (other than as provided in the last sentence of Section 4.1.1 of the Purchase
Agreement as to Excepted Liens (as defined in the Purchase Agreement)). If Landlord fails to
timely deliver to Tenant the Title Response Notice, it shall be conclusively deemed that Landlord
has informed Tenant that Landlord is unable or unwilling to remove or cure any of the Title
Objections. If Landlord advises Tenant in Landlord’s Title Response Notice (or is deemed to have
advised Tenant) that Landlord is unable or unwilling to remove or cure some or all of the Title
Objections, then Tenant must elect to either not exercise its Purchase Option or waive any such
Title Objections; provided, however, if Tenant elects to exercise its Purchase Option
notwithstanding Landlord’s election or deemed election to advise Tenant that Landlord is unable or
unwilling to remove or cure some or all of the Title Objections, then Tenant shall be deemed to
have irrevocably waived any such Title Objections.



     (i) After the date of this Lease and until the later of (A) the expiration of the Purchase
Option Term or (B) the earlier termination of the Purchase Option, (aa) Landlord shall not, without
Tenant’s consent, not to be unreasonably withheld, conditioned or delayed, alienate, lien, encumber
or otherwise transfer all or any portion of the Landlord Property, if the same materially and
adversely affects the value of the Landlord Property following the Closing (as defined in the
Purchase Agreement), and (bb) Landlord shall reasonably cooperate with Tenant (at no out-of-pocket
cost to Landlord) to obtain, and, if necessary, request on behalf of Tenant, an estoppel
certificate from the association pursuant to the terms of the Project CC&Rs and otherwise in a form
reasonably acceptable to both Landlord and Tenant.


3. RIGHT OF FIRST OFFER TO PURCHASE LANDLORD PROPERTY. Subject to the terms of Paragraph 4
below entitled “Options,” and the terms of this Paragraph 3 and provided Tenant occupies and is
operating its business from within the Premises, Landlord hereby grants to Tenant, subject to
applicable laws and regulations, a right of first offer to purchase the Landlord Property following
the third (3rd) anniversary of the Commencement Date and prior to the
fifth (5th) anniversary of the Commencement Date (the “First Offer Term”).




     (a) Procedure for Purchase Offer. Landlord shall notify Tenant (the “First Offer
Notice”) if and when the Landlord Property becomes available for sale to unaffiliated third parties
during the First Offer Term. Pursuant to such First Offer Notice, Landlord shall offer to sell to
Tenant the Landlord Property. The First Offer Notice shall describe the property so offered to
Tenant and shall set forth Landlord’s proposed economic terms and conditions upon which Landlord is
willing to sell such property to Tenant (collectively, the “Purchase Economic Terms”).



     (b) Procedure for Acceptance. If Tenant wishes to exercise Tenant’s right of first
offer to purchase the Landlord Property, then within ten (10) business days of delivery of the
First Offer Notice to Tenant, Tenant shall deliver notice to Landlord of Tenant’s intention to
exercise its right of first offer to purchase with respect to the entire Landlord Property on the
Purchase Economic Terms. Tenant must elect to exercise its right of first offer to



 RIDER 1 




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purchase, if at all, with respect to the entire Landlord Property. Tenant may not elect to
purchase only a portion of the Landlord Property. If Tenant does not so notify Landlord within the
ten (10) business day period, then Landlord shall be free to sell the Landlord Property at any time
within the next succeeding twelve (12) months provided that such sale is on economic terms which
are not less than ninety-five percent (95%) of the Purchase Economic Terms. In the event such sale
is on economic terms which are less than ninety-five percent (95%) of the Purchase Economic Terms,
Landlord shall first re-offer the Landlord Property on such more favorable terms in accordance with
the provisions of this Paragraph 3 above; provided, however, in the event Landlord re-offers the
Landlord Property to Tenant in accordance with the terms of this sentence above, Tenant shall be
obligated to respond to Landlord’s new First Offer Notice within five (5) business days of receipt
of same.




     (c) Purchase Agreement. If Tenant timely exercises Tenant’s right of first offer to
purchase the Landlord Property as set forth herein, Landlord and Tenant shall within ten (10) days
thereafter, execute a purchase agreement upon which Tenant shall agree to purchase the Landlord
Property upon the Purchase Economic Terms and otherwise subject to the terms of this Paragraph 3.
Except as otherwise provided in the Purchase Economic Terms, (i) Tenant shall complete its due
diligence review of the Landlord Property within twenty (20) business days following the date of
the purchase agreement, (ii) the close of escrow under the purchase agreement shall not occur later
than thirty (30) days following the date of the purchase agreement, and (iii) all remaining terms
of the purchase agreement shall be as stated in the purchase agreement, which shall be
substantially in the form of the Purchase Agreement.


4. OPTIONS.




     (a) As used in this Paragraph, the word “Options” means the Extension Options pursuant to
Paragraph 1 herein, the Purchase Option pursuant to Paragraph 2 herein and the right of first offer
to purchase pursuant to Paragraph 3 herein.



     (b) The Options are personal to the original Tenant executing the Lease and any Permitted
Transferee and may be exercised only by the original Tenant executing the Lease or any Permitted
Transferee while occupying the entire Premises and without the intent of thereafter assigning the
Lease or subletting the Premises and may not be exercised or be assigned, voluntarily or
involuntarily, by any person or entity other than the original Tenant executing the Lease or any
Permitted Transferee. The Options are not assignable separate and apart from this Lease, nor may
any Option be separated from the Lease in any manner, either by reservation or otherwise.
Notwithstanding the terms of this clause (b) above, (A) the then remaining Extension Options (but
not the Purchase Option or the above described right of first offer) may be assigned to any
assignee of Tenant’s entire interest under the Lease so long as (i) Landlord consents to the
applicable assignment pursuant to the terms of Paragraph 19 of the Lease, (ii) the original Tenant
expressly acknowledges in writing that it is not being released of any of its liability hereunder
if such assignee exercises all or any of the remaining Extension Options, and (iii) Tenant and such
assignee, as part of the assignment documentation or otherwise, agree in writing that the Basic
Rent applicable during any such remaining Extension Options shall be established based on one
hundred percent (100%) (rather than 95%) of the “fair market rental rate” for the Premises for the
applicable Option Term as defined and determined in accordance with the provisions of Paragraph 1
above, and (B) the Purchase Option may be exercised by (i) a real estate investment trust primarily
focused in the acquisition/ownership of properties leased by pharmaceutical or bio-tech companies
provided Tenant is assigning such rights in connection with a sale/leaseback/lease financing
transaction with such real estate investment trust, or (ii) any other third party buyer designated
by Tenant and approved by Landlord (such approval not to be unreasonably withheld, conditioned or
delayed), so long as all conditions to such exercise specified herein are fully satisfied prior to
the date the Purchase Option is exercised.



     (c) Tenant shall have no right to exercise any Option, notwithstanding any provision of the grant
of the applicable Option to the contrary, and Tenant’s exercise of any Option may be nullified by
Landlord and deemed of no further force or effect, if (i) Tenant shall be in default of any
monetary obligation or material non-monetary obligation under the terms of the Lease as of Tenant’s
exercise of any Option or at any time after the exercise of such Option and prior to the
commencement of the Option event, or (ii) Landlord has given Tenant two (2) or more notices of
monetary default, and Tenant fails to timely cure either or both of the same, during any twelve
(12) consecutive month period.



 RIDER 1 




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RIDER 2




ARBITRATION OF DISPUTES




     This Rider 2 is attached to, made a part of, incorporated into, and amends and supplements,
that certain Standard Industrial Lease dated August 7, 2009 (the “Lease”), by and between
KNICKERBOCKER PROPERTIES, INC. XLVI, a Delaware corporation (“Landlord”), and DENDREON CORPORATION,
a Delaware corporation (“Tenant”). Landlord and Tenant agree that, notwithstanding anything
contained in the Lease to the contrary, the provisions set forth in this Rider 2 will be deemed to
be a part of the Lease and will supersede any contrary provisions in the Lease and shall prevail
and control for all purposes. All references in the Lease and in this Rider 2 to the defined term
“Lease” are to be construed to mean the Lease as amended and supplemented by this Rider 2.
Capitalized terms which are not defined in this Rider 2 have the meanings given to them in the
Lease.



     1. ANY “ACTION” (AS DEFINED IN PARAGRAPH 22 OF THE LEASE) BROUGHT BY TENANT SHALL BE SETTLED
BY FINAL AND BINDING ARBITRATION BEFORE THE AMERICAN ARBITRATION ASSOCIATION (“AAA”), LOCATED AT
SUCH OFFICE AS IS DETERMINED BY THE AAA (OR ANY SUCCESSOR ADDRESS), IN ACCORDANCE WITH THE USUAL
AND THEN-EXISTING COMMERCIAL RULES OR OTHER COMPARABLE RULES AND PROCEDURES OF THE AAA, SUBJECT TO
THE FOLLOWING PROVISIONS:



     (A) THE PARTY SEEKING ARBITRATION SHALL DELIVER A WRITTEN NOTICE OF DEMAND TO RESOLVE DISPUTE
(THE “DEMAND”) TO THE OTHER PARTY AND TO THE AAA. THE DEMAND SHALL INCLUDE A BRIEF STATEMENT OF
SUCH PARTY’S CLAIM, THE AMOUNT THEREOF, AND THE NAME OF THE PROPOSED RETIRED JUDGE FROM THE AAA TO
DECIDE THE DISPUTE (“ARBITRATOR”). WITHIN TEN (10) DAYS AFTER THE EFFECTIVE DATE OF THE DEMAND,
THE OTHER PARTY AGAINST WHOM A DEMAND IS MADE SHALL DELIVER A WRITTEN RESPONSE TO THE DEMANDING
PARTY AND THE AAA. SUCH RESPONSE SHALL INCLUDE A SHORT AND PLAIN STATEMENT OF THE NON-DEMANDING
PARTY’S DEFENSES TO THE CLAIM AND SHALL ALSO STATE WHETHER SUCH PARTY AGREES TO THE ARBITRATOR
CHOSEN BY THE DEMANDING PARTY. IN THE EVENT THE PARTIES CANNOT AGREE UPON AN ARBITRATOR, THEN THE
AAA SHALL SELECT AND NAME A SINGLE ARBITRATOR TO CONDUCT THE HEARINGS.



     (B) IF THE AAA IS NO LONGER IN BUSINESS AND THERE IS NO COMPARABLE SUCCESSOR, THEN THE PARTIES
SHALL AGREE UPON ANOTHER ARBITRATOR. IF THE PARTIES CANNOT AGREE UPON ANOTHER ARBITRATOR, THEN A
SINGLE NEUTRAL ARBITRATOR SHALL BE APPOINTED PURSUANT TO SECTION 1281.6 OF THE CALIFORNIA CODE OF
CIVIL PROCEDURE.



     (C) IF THE CLAIM OR DISPUTE EQUALS OR EXCEEDS THE SUM OF FIFTY THOUSAND DOLLARS ($50,000),
THEN THE PARTIES SHALL BE ENTITLED TO FULL RIGHTS OF DISCOVERY AS SET FORTH IN THE CALIFORNIA CODE
OF CIVIL PROCEDURE (INCLUDING, WITHOUT LIMITATION, C.C.P. § 1283.05) FOR CIVIL ACTIONS TRIED IN THE
SUPERIOR COURTS OF THE STATE OF CALIFORNIA, SUBJECT TO SUCH ORDERS AS MAY BE MADE BY THE AAA. IF
THE DISPUTE BETWEEN THE PARTIES IS LESS THAN FIFTY THOUSAND DOLLARS ($50,000), THEN THERE SHALL BE
NO RIGHT TO DISCOVERY EXCEPT BY STIPULATION OF THE PARTIES OR PURSUANT TO THE DISCRETION OF THE
AAA. IF THE PARTIES CANNOT AGREE AS TO THE AMOUNT IN ISSUE, THE AAA SHALL HOLD A PRELIMINARY
HEARING FOR THE PURPOSE OF DETERMINING WHETHER THE AMOUNT IN ISSUE EQUALS OR EXCEEDS FIFTY THOUSAND
DOLLARS ($50,000).



     (D) THE ARBITRATOR’S POWERS SHALL BE LIMITED AS FOLLOWS: THE ARBITRATOR SHALL FOLLOW THE
SUBSTANTIVE LAWS OF THE STATE OF CALIFORNIA, INCLUDING RULES OF EVIDENCE. THE ARBITRATOR SHALL NOT
CONSIDER ANYTHING OUTSIDE THE RECORD UNLESS NOTICE IS GIVEN TO ALL PARTIES WITH THE OPPORTUNITY TO
RESPOND TO SUCH MATTERS. THE ARBITRATOR SHALL HAVE NO POWER TO MODIFY ANY OF THE PROVISIONS OF THE
AGREEMENT AND THE ARBITRATOR’S JURISDICTION IS LIMITED ACCORDINGLY. THE ARBITRATOR SHALL PREPARE
AND SERVE A WRITTEN DECISION WHICH DETERMINES THE DISPUTE, CONTROVERSY, OR CLAIM AND WHICH
DESIGNATES THE PARTY AGAINST WHOSE POSITION THE DECISION IS RENDERED. JUDGMENT UPON THE AWARD
RENDERED BY THE ARBITRATOR MAY BE ENTERED IN ANY COURT HAVING JURISDICTION THEREOF.



     (E) THE COSTS OF THE RESOLUTION SHALL BE DIVIDED EQUALLY AMONG THE PARTIES INVOLVED IN SUCH
DISPUTE; PROVIDED, HOWEVER, THAT SUCH COSTS, ALONG WITH ALL OTHER COSTS AND EXPENSES, INCLUDING,
WITHOUT LIMITATION, ATTORNEYS’ FEES, SHALL BE SUBJECT TO AWARD, IN FULL OR IN PART, BY THE
ARBITRATOR, IN THE ARBITRATOR’S DISCRETION, TO THE PREVAILING PARTY. UNLESS THE ARBITRATOR SO
AWARDS ATTORNEYS’ FEES, EACH PARTY SHALL BE RESPONSIBLE FOR SUCH PARTY’S OWN ATTORNEYS’ FEES.



     (F) TO THE EXTENT POSSIBLE, THE ARBITRATION HEARINGS SHALL BE CONDUCTED ON CONSECUTIVE DAYS,
EXCLUDING SATURDAYS, SUNDAYS AND HOLIDAYS, UNTIL THE COMPLETION OF THE CASE.



     (G) IN CONNECTION WITH ANY ARBITRATION PROCEEDINGS COMMENCED HEREUNDER, THE ARBITRATOR AND/OR
ANY PARTY SHALL HAVE THE RIGHT TO JOIN ANY



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THIRD PARTIES IN SUCH PROCEEDINGS IN ORDER TO RESOLVE ANY OTHER DISPUTES, THE FACTS OF WHICH
ARE RELATED TO THE MATTERS SUBMITTED FOR ARBITRATION HEREUNDER.




     NOTICE: BY INITIALING IN THE SPACE BELOW YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF
THE MATTERS DESCRIBED IN THIS ‘ARBITRATION OF DISPUTES’ PROVISION DECIDED BY NEUTRAL ARBITRATION AS
PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE
LITIGATED IN A COURT OR JURY TRIAL. BY INITIALING IN THE SPACE BELOW YOU ARE GIVING UP YOUR
JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS THOSE RIGHTS ARE SPECIFICALLY INCLUDED IN THE
‘ARBITRATION OF DISPUTES’ PROVISION. IF YOU REFUSE TO SUBMIT TO ARBITRATION AFTER AGREEING TO THIS
PROVISION, YOU MAY BE COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL
PROCEDURE. YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY.



     THE UNDERSIGNED HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT DISPUTES ARISING
OUT OF THE MATTERS INCLUDED IN THE ‘ARBITRATION OF DISPUTES’ PROVISION TO NEUTRAL ARBITRATION.



	 	 	 	 	 
	 
	 	 


Initials                
             Initials
	 	 






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STANDARD INDUSTRIAL LEASE




(NET)




	 	 	 
	LANDLORD:

	 	KNICKERBOCKER PROPERTIES, INC. XLVI
	 
	 	 
	TENANT:

	 	DENDREON CORPORATION
	 
	 	 
	PROJECT:

	 	Pacific Gateway Business Center
	 
	 	 
	CITY, STATE:

	 	Seal Beach, California
	 
	 	 
	DATE:

	 	August 7, 2009






 









 




TABLE OF CONTENTS





	 	 	 	 	 
	 
	 	 	 	Page
	1.
	 	BASIC LEASE TERMS	 	1
	 
	 	 	 	 
	2.
	 	PREMISES	 	2
	 
	 	 	 	 
	3.
	 	LEASE TERM	 	2
	 
	 	 	 	 
	4.
	 	POSSESSION; CONDITION OF PREMISES	 	2
	 
	 	 	 	 
	5.
	 	RENT	 	3
	 
	 	 	 	 
	6.
	 	PREPAID RENT	 	4
	 
	 	 	 	 
	7.
	 	LETTER OF CREDIT	 	4
	 
	 	 	 	 
	8.
	 	USE OF PREMISES AND PROJECT FACILITIES	 	6
	 
	 	 	 	 
	9.
	 	SURRENDER OF PREMISES; HOLDING OVER	 	7
	 
	 	 	 	 
	10.
	 	SIGNAGE	 	7
	 
	 	 	 	 
	11.
	 	TAXES	 	8
	 
	 	 	 	 
	12.
	 	UTILITIES	 	8
	 
	 	 	 	 
	13.
	 	MAINTENANCE	 	8
	 
	 	 	 	 
	14.
	 	ALTERATIONS	 	10
	 
	 	 	 	 
	15.
	 	RELEASE AND INDEMNITY	 	10
	 
	 	 	 	 
	16.
	 	INSURANCE	 	11
	 
	 	 	 	 
	17.
	 	DESTRUCTION	 	12
	 
	 	 	 	 
	18.
	 	CONDEMNATION	 	13
	 
	 	 	 	 
	19.
	 	ASSIGNMENT OR SUBLEASE	 	13
	 
	 	 	 	 
	20.
	 	DEFAULT	 	15
	 
	 	 	 	 
	21.
	 	LANDLORD'S REMEDIES	 	15
	 
	 	 	 	 
	22.
	 	DEFAULT BY LANDLORD	 	16
	 
	 	 	 	 
	23.
	 	ENTRY OF PREMISES AND PERFORMANCE BY TENANT	 	16
	 
	 	 	 	 
	24.
	 	SUBORDINATION	 	17
	 
	 	 	 	 
	25.
	 	NOTICE	 	17
	 
	 	 	 	 
	26.
	 	WAIVER	 	18
	 
	 	 	 	 
	27.
	 	LIMITATION OF LIABILITY	 	18
	 
	 	 	 	 
	28.
	 	FORCE MAJEURE	 	18
	 
	 	 	 	 
	29.
	 	PROFESSIONAL FEES	 	18
	 
	 	 	 	 
	30.
	 	EXAMINATION OF LEASE	 	19
	 
	 	 	 	 
	31.
	 	ESTOPPEL CERTIFICATE	 	19
	 
	 	 	 	 
	 
	 	 	 	 
	32.
	 	RULES AND REGULATIONS	 	19
	 
	 	 	 	 
	33.
	 	LIENS	 	19
	 
	 	 	 	 
	34.
	 	MISCELLANEOUS PROVISIONS	 	19
	 
	 	 	 	 
	35.
	 	LEASE EXECUTION	 	21
	 
	 	 	 	 
	36.
	 	SECURITY	 	21
	 
	 	 	 	 
	37.
	 	INCENTIVES	 	21






	 	 	 
	EXHIBITS
	 	 
	 
	 	 
	EXHIBIT A:
	 	DEPICTION OF PREMISES
	EXHIBIT B:
	 	DESCRIPTION OF PREMISES LAND
	EXHIBIT C:
	 	WORK LETTER AGREEMENT
	EXHIBIT D:
	 	NOTICE OF LEASE TERM DATES







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	 	 	 	Page
	EXHIBIT E:
	 	TENANT ESTOPPEL CERTIFICATE
	EXHIBIT F:
	 	RULES AND REGULATIONS
	EXHIBIT G:
	 	PROJECT SIGNAGE CRITERIA
	EXHIBIT H:
	 	HAZARDOUS MATERIALS ADDENDUM
	EXHIBIT I:
	 	HAZARDOUS MATERIALS QUESTIONNAIRE
	EXHIBIT J:
	 	REFERENCE PROVISION
	EXHIBIT K:
	 	FORM OF LETTER OF CREDIT
	EXHIBIT L:
	 	ENVIRONMENTAL REPORTS
	 
	 	 
	RIDERS
	 	 
	 
	 	 
	RIDER 1:
	 	OPTIONS
	RIDER 2:
	 	ARBITRATION OF DISPUTES






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