EXHIBIT 10.4



BUSINESS LOAN AGREEMENT



|           |  |            |  |            |  |           |  |           |  |         |  |         |  |         
|---------- |  | ---------- |  | ---------- |  | --------- |  | --------- |  | ------- |  | ------- |  | --------
|Principal  |  | Loan Date  |  | Maturity   |  | Loan No   |  | Call/Coll |  | Account |  | Officer |  | Initials
|$6,000,000 |  | 02-25-2003 |  | 03-05-2005 |  | 109080155 |  | 5050      |  |         |  | 008     |  |         



References in the
shaded area are for Lenders use only and do not limit the applicability of this document

to any particular loan or item

Any item above containing  has been omitted due to text length limitations.



|          |  |                                            |  |         |  |                    
|--------- |  | ------------------------------------------ |  | ------- |  | -------------------
|Borrower: |  | Rancor Realty Fund V, a California Limited |  | Lender: |  | Mid-Peninsula Bank 
|          |  | Partnership                                |  |         |  | Palo Alto Office   
|          |  | 400 South El Camino Real                   |  |         |  | 420 Cowper Street  
|          |  | San Mateo, CA 94402                        |  |         |  | Palo Alto, CA 94301



THIS BUSINESS LOAN AGREEMENT dated
February 25, 2003, Is made and executed between Rancon Realty Fund V, a California Limited Partnership (Borrower) and Mid-Peninsula Bank (Lender) on the following terms and conditions. Borrower has received prior commercial
loans from Lender or has applied to Lender for a commercial loan or loans or other financial accommodations, including those which may be described on any exhibit or schedule attached to this Agreement (Loan). Borrower understands and
agrees that: (A) in granting, renewing, or extending any Loan, Lender is relying upon Borrowers representations, warranties, and agreements as set forth in this Agreement; (B) the granting, renewing, or extending of any Loan by Lender at all
times shall be subject to Lenders sole judgment and discretion; and (C) all such Loans shall be and remain subject to the terms and conditions of this Agreement.



TERM. This Agreement shall be effective as of February 25, 2003, and shall continue in full force and effect until such time as all of
Borrowers Loans in favor of Lender have been paid in full, including principal, interest, costs, expenses. attorneys fees, and other fees and charges, or until such time as the parties may agree in writing to terminate this Agreement.



CONDITIONS PRECEDENT TO EACH ADVANCE. Lenders obligation to make the initial
Advance and each subsequent Advance under this Agreement shall be subject to the fulfillment to Lenders satisfaction of all of the conditions set forth in this Agreement and in the Related Documents.



Loan Documents. Borrower shall provide to Lender the following documents for
the Loan: (1) the Note: (2) Security Agreements granting to Lender security interests in the Collateral; (3) financing statements and all other documents perfecting Lenders Security interests; (4) evidence of insurance as required below; (5)
together with all such Related Documents as Lender may require for the Loan; all in form and substance satisfactory to Lender and Lenders counsel.



Borrowers Authorization. Borrower shall have provided in form and substance satisfactory to Lender properly certified resolutions, duly authorizing
the execution and delivery of this Agreement, the Note and the Related Documents. In addition, Borrower shall have provided such other resolutions, authorizations, documents and instruments as Lender or its counsel, may require.



Payment of Fees and Expenses. Borrower shall have paid to Lender all fees,
charges, and other expenses which are then due and payable as specified in this Agreement or any Related Document.



Representations and Warranties. The representations and warranties set forth in this Agreement, in the Related Documents, and in any document or
certificate delivered to Lender under this Agreement are true and correct.



No Event of Default. There shall not exist at the time of any Advance a condition which would constitute an Event of Default under this Agreement or under any Related Document.



REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender, as of the date of
this Agreement, as of the date of each disbursement of loan proceeds, as of the date of any renewal, extension or modification of any Loan, and at all times any Indebtedness exists:



Organization. Borrower is a partnership which is, and at all times shall be, duly organized, validly existing, and in good
standing under and by virtue of the laws of the State of California. Borrower is duly authorized to transact business in all other states in which Borrower is doing business, having obtained all necessary filings, governmental licenses and approvals
for each state in which Borrower is doing business. Specifically, Borrower is, and at all times shall be, duly qualified as a foreign partnership in all states in which the failure to so quality would have a material adverse effect on its business
or financial condition. Borrower has the full power and authority to own its properties and to transact the business in which it is presently engaged or presently proposes to engage. Borrower maintains an office at 400 South El Camino Real. San
Mateo, CA 94402. Unless Borrower has designated otherwise in writing, the principal office is the office at which Borrower keeps its books and records including its records concerning the Collateral. Borrower will notify Lender prior to any change
in the location of



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BUSINESS LOAN AGREEMENT

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|Loan No: 109080155 |  | (Continued) |  | 



Borrowers principal office address or
any change in Borrowers name. Borrower shall do all things necessary to preserve and to keep in full force and effect its existence. rights and privileges, and shall comply with all regulations, rules, ordinances, statutes, orders and decrees
of any governmental or quasi-governmental authority or court applicable to Borrower and Borrowers business activities.



Assumed Business Names. Borrower has filed or recorded all documents or filings required by law relating to all assumed business names used by Borrower.
Excluding the name of Borrower, the following is a complete fist of ail assumed business names under which Borrower does business: None.



Authorization. Borrowers execution, delivery, and performance of this Agreement and all the Related Documents have been duly authorized by ail
necessary action by Borrower and do not conflict with, result in a violation of, or constitute a default under (1) any provision of Borrowers articles or agreements of partnership. or any agreement or other instrument binding upon Borrower or (2)
any taw, governmental regulation, court decree, or order applicable to Borrower or to Borrowers properties.



Financial Information. Each of Borrowers financial statements supplied to Lender truly and completely disclosed Borrowers financial condition as of
the date of the statement, and there has been no material adverse change in Borrowers financial condition subsequent to the date of the most recent financial statement supplied to Lender. Borrower has no material contingent obligations except
as disclosed in such financial statements.



Legal Effect. This
Agreement constitutes, and any instrument or agreement Borrower is required to give under this Agreement when delivered will constitute legal, valid, and binding obligations of Borrower enforceable against Borrower in accordance with their
respective terms.



Properties. Except as contemplated by this
Agreement or as previously disclosed in Borrowers financial statements or in writing to Lender and as accepted by Lender, and except for property tax liens for taxes not presently due and payable, Borrower owns and has good title to all of Borrowers
properties free and clear of all Security Interests, and has not executed any security documents or financing statements relating to such properties. Ali of Borrowers properties are titled in Borrowers legal name, and Borrower has not
used or filed a financing statement under any other name for at least the last five (5) years.



Hazardous Substances. Except as disclosed to and acknowledged by Lender in writing. Borrower represents and warrants that: (1) During the period of Borrowers ownership of Borrowers Collateral. there has been no
use, generation, manufacture, storage, treatment, disposal, release or threatened release of any Hazardous Substance by any person on, under, about or from any of the Collateral. (2) Borrower has no knowledge of, or reason to believe that there has
been (a) any breach or violation of any Environmental Laws; (b) any use, generation, manufacture, storage,



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BUSINESS LOAN AGREEMENT

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treatment, disposal. release or
threatened release of any Hazardous Substance on, under, about or from the Collateral by any prior owners or occupants of any of the Collateral; or (c) any actual or threatened litigation or claims of any kind by any person relating to such matters.
(3) Neither Borrower nor any tenant, contractor, agent or other authorized user of any of the Collateral shall use, generate, manufacture, store, treat, dispose of or release any Hazardous Substance on, under, about or from any of the Collateral;
and any such activity shall be conducted in compliance with all applicable federal, state, and local laws, regulations. and ordinances, including without limitation all Environmental Laws. Borrower authorizes Lender and its agents to enter upon the
Collateral to make such inspections and tests as Lender may deem appropriate to determine compliance of the Collateral with this section of the Agreement. Any inspections or tests made by Lender shall be at Borrowers expense and for
Lenders purposes only and shall not be construed to create any responsibility or liability on the part of Lender to Borrower or to any other person. The representations and warranties contained herein are based on Borrowers due diligence
in investigating the Collateral for hazardous waste and Hazardous Substances. Borrower hereby (1) releases and waives any future claims against Lender for indemnity or contribution in the event Borrower becomes liable for cleanup or other costs
under any such laws, and (2) agrees to indemnify and hold harmless Lender against any and all claims, losses, liabilities. damages, penalties. and expenses which Lender may directly or indirectly sustain or suffer resulting from a breach of this
section of the Agreement or as a consequence of any use, generation, manufacture, storage, disposal, release or threatened release of a hazardous waste or substance on the Collateral. The provisions of this section of the Agreement, including the
obligation to indemnify, shall survive the payment of the Indebtedness and the termination, expiration or satisfaction of this Agreement and shall not be affected by Lenders acquisition of any interest in any of the Collateral. whether by
foreclosure or otherwise.



Litigation and Claims. No
litigation, claim, investigation, administrative proceeding or similar action (including those for unpaid taxes) against Borrower is pending or threatened, and no other event has occurred which may materially adversely affect Borrowers
financial condition or properties, other than litigation, claims, or other events, if any, that have been disclosed to and acknowledged by Lender in writing.



Taxes. To the best of Borrowers knowledge, all of Borrowers tax returns and reports that are or were required to be filed, have been filed,
and all taxes. assessments and other governmental charges have been paid in full, except those presently being or to be contested by Borrower in good faith in the ordinary course of business and for which adequate reserves have been provided.



Lien Priority. Unless otherwise previously disclosed to Lender
in writing, Borrower has not entered into or granted any Security Agreements, or permitted the filing or attachment of any Security Interests on or affecting any of the Collateral directly or indirectly securing repayment of Borrowers Loan and
Note, that would be prior or that may in any way be superior to Lenders Security Interests and rights in and to such Collateral.



Binding Effect. This Agreement, the Note, all Security Agreements (if any), and all Related Documents are binding upon the signers thereof, as well as
upon their successors, representatives and assigns, and are legally enforceable in accordance with their respective terms.



AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender that, so long as this Agreement remains in effect, Borrower will:



Notices of Claims and Litigation. Promptly inform Lender in writing of (1)
ail material adverse changes in Borrowers financial condition. and (2) all existing and all threatened litigation, claims, investigations, administrative proceedings or similar actions affecting Borrower or any Guarantor which could materially
affect the financial condition of Borrower or the financial condition of any Guarantor.



Financial Records. Maintain its books and records in accordance with GAAP, applied on a consistent basis, and permit Lender to examine and audit Borrowers books and records at all reasonable times.



Financial Statements. Furnish Lender with the following:



Additional Requirements. Borrower agrees to provide Lender
with the following:



1. Annual 10-K report;

2. A copy of Borrowers Rent Roll semiannually;

3. A copy of Borrowers Operating Statement annually.



All financial reports required to be provided under this Agreement shall be prepared in accordance with GAAP, applied on a
consistent basis, and certified by Borrower as being true and correct.



Additional Information. Furnish such additional information and statements, as Lender may request from time to time.



Financial Covenants and Ratios. Comply with the following covenants and ratios:





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BUSINESS LOAN AGREEMENT

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|Loan No: 109080155 |  | (Continued) |  | 



Minimum Income and
Cash flow Requirements. Other Cash Flow requirements are as follows: Maintain a Debt Service Ratio (defined as: Cash Flow plus Interest Expense divided by Current Portion of Long-Term Debt and Capital Leases and Interest Expense) in excess of 1.250
to 1.000 for each property.



Except as provided above, all
computations made to determine compliance with the requirements contained in this paragraph shall be made in accordance with generally accepted accounting principles, applied on a consistent basis. and certified by Borrower as being true and
correct.



Insurance. Maintain fire and other risk insurance,
public liability insurance, and such other insurance as Lender may require with respect to Borrowers properties and operations, in form, amounts, coverages and with insurance companies acceptable to Lender. Borrower, upon request of lender,
will deliver to Lender from time to time the policies or certificates of insurance in form satisfactory to Lender, including stipulations that coverages will not be cancelled or diminished without at least ten (10) days prior written notice to
Lender. Each insurance policy also shall include an endorsement providing that coverage in favor of Lender will not be impaired in any way by any act, omission or default of Borrower or any other person. In connection with all policies covering
assets in which Lender holds or is offered a security interest for the Loans, Borrower will provide Lender with such lenders loss payable or other endorsements as Lender may require.



Insurance Reports. Furnish to Lender, upon request of Lender, reports on each
existing insurance policy showing such information as Lender may reasonably request, including without limitation the following: (1) the name of the insurer; (2) the risks insured; (3) the amount of the policy; (4) the properties insured; (5) the
then current property values on the basis of which insurance has been obtained, and the manner of determining those values; and (6) the expiration date of the policy. In addition, upon request of Lender (however not more often than annually),
Borrower will have an independent appraiser satisfactory to Lender determine, as applicable, the actual cash value or replacement cost of any Collateral. The cost of such appraisal shall be paid by Borrower.



Other Agreements. Comply with all terms and conditions of all other
agreements. whether now or hereafter existing, between Borrower and any other party and notify Lender immediately in writing of any default in connection with any other such agreements.



Loan Proceeds. Use all Loan proceeds solely for Borrowers business operations, unless specifically consented to the
contrary by Lender in writing.



Taxes, Charges and Liens. Pay and discharge
when due all of its indebtedness and obligations, including without limitation all assessments,



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BUSINESS LOAN AGREEMENT

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|Loan No: 109080155 |  | (Continued) |  | Page 3



taxes, governmental charges, levies
and liens, of every kind and nature, imposed upon Borrower or its properties, income, or profits, prior to the date on which penalties would attach, and ail lawful claims that, if unpaid, might become a lien or charge upon any of Borrowers
properties, income. or profits.



Performance. Perform and
comply, in a timely manner, with all terms, conditions, and provisions set forth in this Agreement, in the Related Documents, and in. ail other instruments and agreements between Borrower and Lender. Borrower shall notify Lender immediately in
writing of any default in connection with any agreement.



Operations. Maintain executive and management personnel with substantially the same qualifications and experience as the present executive and management personnel: provide written notice to Lender of any change in executive and management
personnel; conduct its business affairs in a reasonable and prudent manner.



Environmental Studies. Promptly conduct and complete, at Borrowers expense, all such investigations, studies, samplings and testings as may be requested by Lender or any governmental authority relative to any
substance, or any waste or by-product of any substance defined as toxic or a hazardous substance under applicable federal, state, or local law, rule, regulation, order or directive, at or affecting any property or any facility owned, leased or used
by Borrower.



Compliance with Governmental Requirements. Comply
with all laws, ordinances, and regulations, now or hereafter in effect, of all governmental authorities applicable to the conduct of Borrowers properties, businesses and operations, and to the use or occupancy of the Collateral, including
without limitation, the Americans With Disabilities Act. Borrower may contest in good faith any such law, ordinance, or regulation and withhold compliance during any proceeding, including appropriate appeals, so long as Borrower has notified Lender
in writing prior to doing so and so long as, in lenders sole opinion, Lenders interests in the Collateral are not jeopardized. Lender may require Borrower to post adequate security or a surety bond, reasonably satisfactory to Lender, to
protect Lenders interest.



Inspection. Permit employees
or agents of Lender at any reasonable time to inspect any and all Collateral for the Loan or Loans and Borrowers other properties and to examine or audit Borrowers books, accounts, and records and to make copies and memoranda of
Borrowers books. accounts, and records. If Borrower now or at any time hereafter maintains any records (including without limitation computer generated records and computer software programs for the generation of such records) in the
possession of a third party, Borrower, upon request of Lender, shall notify such party to permit Lender free access to such records at all reasonable times and to provide Lender with copies of any records it may request, all at Borrowers
expense.



Compliance Certificates. Unless waived in writing by
Lender, provide Lender at least annually, with a certificate executed by Borrowers chief financial officer. or other officer or person acceptable to Lender, certifying that the representations and warranties set forth in this Agreement are
true and correct as of the date of the certificate and further certifying that, as of the date of the certificate, no Event of Default exists under this Agreement.



Environmental Compliance and Reports. Borrower shall comply in all respects with any and all Environmental Laws; not cause
or permit to exist, as a result of an intentional or unintentional action or omission on Borrowers part or on the part of any third party, on property owned and/or occupied by Borrower, any environmental activity where damage may result to the
environment, unless such environmental activity is pursuant to and in compliance with the conditions of a permit issued by the appropriate federal, state or local governmental authorities: shall furnish to Lender promptly and in any event within
thirty (30) days after receipt thereof a copy of any notice. summons, lien, citation, directive, letter or other communication from any governmental agency or instrumentality concerning any intentional or unintentional action or omission on
Borrowers part in connection with any environmental activity whether or not there is damage to the environment and/or other natural resources.



Additional Assurances. Make, execute and deliver to Lender such promissory notes, mortgages, deeds of trust, security agreements, assignments, financing
statements, instruments, documents and other agreements as Lender or its attorneys may reasonably request to evidence and secure the Loans and to perfect all Security Interests.



RECOVERY OF ADDITIONAL COSTS. If the imposition of or any change in any law, rule, regulation or guideline, or the interpretation or
application of any thereof by any court or administrative or governmental authority (including any request or policy not having the force of law) shall impose, modify or make applicable any taxes (except federal, state or local income or franchise
taxes imposed on Lender), reserve requirements, capital adequacy requirements or other obligations which would (A) increase the cost to Lender for extending or maintaining the credit facilities to which this Agreement relates, (B) reduce the amounts
payable to Lender under this Agreement or the Related Documents, or (C) reduce the rate of return on Lenders capital as a consequence of Lenders obligations with respect to the credit facilities to which this Agreement relates, then
Borrower agrees to pay Lender such additional amounts as will compensate Lender therefore, within five (5) days after Lenders written demand for such payment, which demand shall be accompanied by an explanation of such imposition or charge and
a calculation in reasonable detail of the additional amounts payable by Borrower, which explanation and calculations shall be conclusive in the absence of manifest error.



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BUSINESS LOAN AGREEMENT

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|Loan No: 109080155 |  | (Continued) |  | 



LENDERS EXPENDITURES. If any
action or proceeding is commenced that would materially affect Lenders interest in the Collateral or if Borrower fails to comply with any provision of this Agreement or any Related Documents, including but not limited to Borrowers
failure to discharge or pay when due any amounts Borrower is required to discharge or pay under this Agreement or any Related Documents. Lender on Borrowers behalf may (but shall not be obligated to) take any action that Lender deems
appropriate, including but not limited to discharging or paying all taxes, liens, security interests, encumbrances and other claims, at any time levied or placed an any Collateral and paying all costs for insuring, maintaining and preserving any
Collateral. All such expenditures incurred or paid by Lender for such purposes will then bear interest at the rate charged under the Note from the date incurred or paid by Lender to the date of repayment by Borrower. All such expenses will become a
part of the Indebtedness and, at Lenders option, will (A) be payable on demand; (8) be added to the balance of the Note and be apportioned among and be payable with any installment payments to become due during either (1) the term of any
applicable insurance policy; or (2) the remaining term of the Note; or (C) be treated as a balloon payment which will be due and payable at the Notes maturity.



NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that while this Agreement is in effect, Borrower shall not, without the prior
written consent of Lender:



Indebtedness and Liens. (1) Except
for trade debt incurred in the normal course of business and indebtedness to Lender contemplated by this Agreement, create, incur or assume indebtedness for borrowed money, including capital leases. (2) sell, transfer, mortgage, assign, pledge,
lease, grant a security interest in, or encumber any of Borrowers assets (except as allowed as Permitted Liens), or (3) sell with recourse any of Borrowers accounts, except to Lender.



Continuity of Operations. (1) Engage in any business activities substantially
different than those in which Borrower is presently engaged, (2) cease operations, liquidate, merge, transfer, acquire or consolidate with any other entity, change its name, dissolve or transfer or sell Collateral out of the ordinary course of
business, or (3) make any distribution with respect to any capital account, whether by reduction of capital or otherwise.



Loans, Acquisitions and Guaranties. (1) Loan, invest in or advance money or assets, (2) purchase, create or acquire any interest in any other enterprise
or entity, or (3) incur any obligation as surety or guarantor other than in the ordinary course of business.



CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan to Borrower. whether under this Agreement or under any other agreement, Lender shall have no obligation to make Loan Advances or to disburse
Loan proceeds it., (A) Borrower or any Guarantor is in default



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BUSINESS LOAN AGREEMENT

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|Loan No: 109080155 |  | (Continued) |  | Page 4



under the terms of this Agreement or
any of the Related Documents or any other agreement that Borrower or any Guarantor has with Lender; (B) Borrower or any Guarantor dies, becomes incompetent or becomes insolvent, files a petition in bankruptcy or similar proceedings, or is adjudged a
bankrupt; (C) there occurs a material adverse change in Borrowers financial condition, in the financial condition of any Guarantor, or in the value of any Collateral securing any Loan; or (D) any Guarantor seeks, claims or otherwise attempts
to limit, modify or revoke such Guarantors guaranty of the Loan or any other loan with Lender.



DEFAULT. Each of the following shall constitute an Event of Default under this Agreement:



Payment Default. Borrower fails to make any payment when due under the Loan.



Other Defaults. Borrower fails to comply with or to perform any other term, obligation, covenant or condition contained in
this Agreement or in any of the Related Documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between Lender and Borrower.



Environmental Default. Failure of any party to comply with or perform when due any term, obligation, convenant or condition
contained in any environmental agreement executed in connection with any Loan.



Default in Favor of Third Parties. Borrower or any Grantor defaults under any loan, extension of credit, security agreement, purchase or sales agreement, or any other agreement, in favor of any other creditor or
person that may materially affect any of Borrowers or any Grantors property or Borrowers or any Grantors ability to repay the Loans or perform their respective obligations under this Agreement or any of the Related Documents.



False Statements. Any warranty, representation or statement made or
furnished to Lender by Borrower or on Borrowers behalf under this Agreement or the Related Documents is false or misleading in any material respect, either now or at the time made or furnished or becomes false or misleading at any time thereafter.



Death or Insolvency. The dissolution or termination of
Borrowers existence as a going business or the death of any partner, the insolvency of Borrower, the appointment of a receiver for any part of Borrowers property, any assignment for the benefit of creditors, any type of creditor workout, or the
commencement of any proceeding under any bankruptcy or insolvency laws by or against Borrower.



Defective Collateralization. This Agreement or any of the Related Documents ceases to be in full force and effect (including failure of any collateral document to create a valid and perfected security interest or
lien) at any time and for any reason.



Creditor or Forfeiture
Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help, repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the Loan. This
includes a garnishment of any of Borrowers accounts, including deposit accounts, with Lender. However, this Event of Default shall not apply if there is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the
basis of the creditor or forfeiture proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in an amount determined
by Lender, in its sole discretion, as being an adequate reserve or bond for the dispute.



Events Affecting Guarantor. Any of the preceding events occurs with respect to any Guarantor of any of the Indebtedness or any Guarantor dies or becomes incompetent, or revokes or disputes the validity of, or
liability under, any Guaranty of the Indebtedness. In the event of a death. Lender, at its option, may, but shall not be required to, permit the Guarantors estate to assume unconditionally the obligations arising under the guaranty in a manner
satisfactory to Lender, and, in doing so, cure any Event of Default.



Events Affecting General Partner of Borrower. Any of the preceding events occurs with respect to any general partner of Borrower or any general partner dies or becomes incompetent.



Change in Ownership. The resignation or expulsion of any general partner with
an ownership interest of twenty-five percent (25%) or more in Borrower.



Adverse Change. A material adverse change occurs in Borrowers financial condition, or Lender believes the prospect of payment or performance of the Loan is impaired.



Right to Cure. If any default, other than a default on Indebtedness, is curable and if Borrower or Grantor, as the case may
be. has not been given a notice of a similar default within the preceding twelve (12) months, it may be cured (and no Event



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BUSINESS LOAN AGREEMENT

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of Default will have occurred) if Borrower or Grantor, as the case may be, after receiving written notice from
Lender demanding cure of such default: (1) cure the default within fifteen (15) days; or (2) if the cure requires more than fifteen (15) days, immediately initiate steps which Lender deems in Lenders sole discretion to be sufficient to cure the
default and thereafter continue and complete all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical.



EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except where otherwise provided in this Agreement or the Related Documents, all commitments and
obligations of Lender under this Agreement or the Related Documents or any other agreement immediately will terminate (including any obligation to make further Loan Advances or disbursements), and, at Lenders option, all Indebtedness
immediately will become due and payable, all without notice of any kind to Borrower, except that in the case of an Event of Default of the type described in the Insolvency subsection above, such acceleration shall be automatic and not
optional. In addition, Lender shall have all the rights and remedies provided in the Related Documents or available at law, in equity, or otherwise. Except as may be prohibited by applicable law, all of tenders rights and remedies shall be
cumulative and may be exercised singularly or concurrently. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of Borrower or of any
Grantor shall not affect Lenders right to declare a default and to exercise its rights and remedies.



ADDITIONAL PROVISION. Any amendments to the leases or any new leases negotiated or amendments to the partnership agreement are to be provided to the Lender.



EXHIBIT A. An exhibit, titled Exhibit A to Business Loan Agreement,
is attached to this Agreement and by this reference is made a part of this Agreement just as if all the provisions, terms and conditions of the Exhibit had been fully set forth in this Agreement.



MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this
Agreement:



Amendments. This Agreement, together with any
Related Documents, constitutes the entire understanding and agreement of the parties as to the matters set forth in this Agreement. No alteration of or amendment to this Agreement shall be effective unless given in writing and signed by the party or
parties sought to be charged or bound by the alteration or amendment.



Attorneys Fees; Expenses. Borrower agrees to pay upon demand all of Lenders costs and expenses, including lenders attorneys fees and Lenders legal expenses, incurred in connection with the enforcement of this Agreement.
Lender may hire or pay someone else to help enforce this Agreement, and Borrower shall pay the costs and expenses of such enforcement. Costs and expenses include Lenders attorneys fees and legal expenses whether or not there is a
lawsuit, including attorneys fees and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post-judgment collection services. Borrower also shall pay
all



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court costs and such
additional fees as may be directed by the court.



Caption
Headings. Caption headings in this Agreement are for convenience purposes only and are not to be used to interpret or define the provisions of this Agreement.



Consent to Loan Participation. Borrower agrees and consents to Lenders sale or transfer, whether now or later, of one or more participation
interests in the Loan to one or more purchasers, whether related or unrelated to Lender. Lender may provide, without any limitation whatsoever, to any one or more purchasers, or potential purchasers. any information or knowledge Lender may have
about Borrower or about any other matter relating to the Loan, and Borrower hereby waives any rights to privacy Borrower may have with respect to such matters. Borrower additionally waives any and all notices of sale of participation interests, as
well as all notices of any repurchase of such participation interests. Borrower also agrees that the purchasers of any such participation interests will be considered as the absolute owners of such interests in the Loan and will have all the rights
granted under the participation agreement or agreements governing the sale of such participation interests. Borrower further waives all rights of offset or counterclaim that it may have now or later against Lender or against any purchaser of such a
participation interest and unconditionally agrees that either Lender or such purchaser may enforce Borrowers obligation under the Loan irrespective of the failure or insolvency of any holder of any interest in the Loan. Borrower further agrees
that the purchaser of any such participation interests may enforce its interests irrespective of any personal claims or defenses that Borrower may have against Lender.



Governing Law. This Agreement will be governed by, construed and enforced in accordance with federal law and the laws of the
State of California. This Agreement has been accepted by Lender in the State of California.



Choice of Venue. If there is a lawsuit, Borrower agrees upon Lenders request to submit to the jurisdiction of the courts of Santa Clara County, State of California.



No Waiver by Lender. Lender shall not be deemed to have waived any rights
under this Agreement unless such waiver is given in writing and signed by Lender. No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right. A waiver by Lender of a provision of
this Agreement shall not prejudice or constitute a waiver of Lenders right otherwise to demand strict compliance with that provision or any other provision of this Agreement. No prior waiver by Lender, nor any course of dealing between Lender and
Borrower, or between Lender and any Grantor, shall constitute a waiver of any of Lenders rights or of any of Borrowers or any Grantors obligations as to any future transactions. Whenever the consent of Lender is required under this
Agreement, the granting of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in ail cases such consent may be granted or withheld in the sale discretion of
Lender.



Notices. Any notice required to be given under this
Agreement shall be given in writing, and shall be effective when actually delivered, when actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier, or, if mailed, when
deposited in the United States mail, as first class, certified or registered mail postage prepaid, directed to the addresses shown near the beginning of this Agreement. Any party may change its address for notices under this Agreement by giving
formal written notice to the other parties, specifying that the purpose of the notice is to change the partys address. For notice purposes. Borrower agrees to keep Lender informed at all times of Borrowers current address. Unless otherwise
provided or required by law, if there is more than one Borrower, any notice given by Lender to any Borrower is deemed to be notice given to all Borrowers.



Severability. If a court of competent jurisdiction finds any provision of this Agreement to be illegal, invalid, or unenforceable as to any circumstance,
that finding shall not make the offending provision illegal, invalid. or unenforceable as to any other circumstance. If feasible. the offending provision shall be considered modified so that it becomes legal, valid and enforceable. If the offending
provision cannot be so modified, it shall be considered deleted from this Agreement. Unless otherwise required by law, the illegality, invalidity, or unenforceability of any provision of this Agreement shall not affect the legality, validity or
enforceability of any other provision of this Agreement.



Subsidiaries and Affiliates of Borrower. To the extent the context of any provisions of this Agreement makes it appropriate, including without limitation any representation, warranty or covenant, the word Borrower as used in
this Agreement shall include all of Borrowers subsidiaries and affiliates. Notwithstanding the foregoing however, under no circumstances shall this Agreement be construed to require Lender to make any Loan or other financial accommodation to
any of Borrowers subsidiaries or affiliates.



Successors
and Assigns. All covenants and agreements contained by or on behalf of Borrower shall bind Borrowers successors and assigns and shall inure to the benefit of Lender and its successors and assigns. Borrower shall not, however, have the right to
assign Borrowers rights under this Agreement or any interest therein, without the prior written consent of Lender.



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BUSINESS LOAN AGREEMENT

|                   |  |             |  | 
|------------------ |  | ----------- |  | 
|Loan No: 109080155 |  | (Continued) |  | 



Survival of
Representations and Warranties. Borrower understands and agrees that in extending Loan Advances, Lender is relying on all representations, warranties, and covenants made by Borrower in this Agreement or in any certificate or other instrument
delivered by Borrower to Lender under this Agreement or the Related Documents. Borrower further agrees that regardless of any investigation made by Lender, all such representations, warranties and covenants will survive the extension of Loan
Advances and delivery to Lender of the Related Documents, shall be continuing in nature, shall be deemed made and reciated by Borrower at the time each Loan Advance is made, and shall remain in full force and effect until such time as
Borrowers Indebtedness shall be paid in full, or unfit this Agreement shall be terminated in the manner provided above, whichever is the last to occur.



Time is of the Essence. Time is of the essence in the performance of this Agreement.



Waive Jury. All parties to this Agreement hereby waive the right to any jury trial in any action, proceeding, or
counterclaim brought by any party against any other party. (Initial Here )



DEFINITIONS. The following capitalized words and terms shall have the following meanings when
used in this Agreement. Unless specifically stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms used in the singular shall include the plural, and the plural
shall include the singular, as the context may require. Words and terms not otherwise defined in this Agreement shall have the meanings attributed to such terms in the Uniform Commercial Code. Accounting words and terms not otherwise defined in this
Agreement shall have the meanings assigned to them in accordance with generally accepted accounting principles as in effect on the date of this Agreement:



Advance. The word Advance means a disbursement of Loan funds made, or to be made, to Borrower or on Borrowers behalf on a line of credit or
multiple advance basis under the terms and conditions of this Agreement.



Agreement. The word Agreement means this Business Loan Agreement, as this Business Loan Agreement may be amended or modified from time to time, together with all exhibits and schedules attached to this
Business Loan Agreement from time to time.



Borrower. The word
Borrower means Rancon Realty Fund V, a California Limited Partnership, and all other persons and entities signing the Note in whatever capacity.



Collateral. The word Collateral means all property and assets granted as collateral security for a Loan, whether real or personal property,
whether granted directly or indirectly, whether granted now or in the future, and whether granted in the form of a security interest, mortgage, collateral mortgage, deed of trust, assignment, pledge, crop pledge, chattel mortgage, collateral chattel
mortgage, chattel trust, factors lien,



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BUSINESS LOAN AGREEMENT

|                   |  |             |  |       
|------------------ |  | ----------- |  | ------
|Loan No: 109080155 |  | (Continued) |  | Page 6



equipment trust, conditional sale,
trust receipt, lien, charge, lien or title retention contract, lease or consignment intended as a security device. or any other security or lien interest whatsoever, whether created by law, contract, or otherwise.



Environmental Laws. The words Environmental Laws mean any and all
state, federal and local statutes, regulations and ordinances relating to the protection of human health or the environment, including without limitation the Comprehensive Environmental Response. Compensation, and Liability Act of 1980, as amended,
42 U.S.C. Section 9601, et seq. (CERCL A), the Superfund Amendments and Reauthorization Act of 1986. Pub. L. No. 99-499 (SARA), the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, at seq., the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901, at seq., Chapters 6.5 through 7.7 at Division 20 of the California Health and Safety Code, Section 25100, at seq., or other applicable state or federal laws, rules, or regulations adopted
pursuant thereto.



Event of Default. The words Event of
Default mean any of the events of default set forth in this Agreement in the default section of this Agreement.



GAAP. The word GAAP means generally accepted accounting principles.



Grantor. The word Grantor means each and all of the persons or entities granting a Security Interest in any
Collateral for the Loan, including without limitation all Borrowers granting such a Security Interest.



Guarantor. The word Guarantor means any guarantor, surety. or accommodation party of any or all of the Loan.



Guaranty. The word Guaranty means the guaranty from Guarantor to
Lender, including without limitation a guaranty of all or part of the Note.



Hazardous Substances. The words Hazardous Substances mean materials that, because of their quantity, concentration or physical, chemical or infectious characteristics, may cause or pose a present or
potential hazard to human health or the environment when improperly used, treated. stored. disposed of, generated, manufactured, transported or otherwise handled. The words Hazardous Substances are used in their very broadest sense and
include without limitation any and all hazardous or toxic substances, materials or waste as defined by or listed under the Environmental Laws. The term Hazardous Substances also includes, without limitation, petroleum and petroleum
by-products or any fraction thereof and asbestos.



Indebtedness. The word Indebtedness means the indebtedness evidenced by the Note or Related Documents, including all principal and interest together with all other indebtedness and costs and expenses for which Borrower is
responsible under this Agreement or under any of the Related Documents.



Lender. The word Lender means Mid-Peninsula Bank, its successors and assigns.



Loan. The word Loan means any and all loans and financial accommodations from Lender to Borrower whether now or hereafter existing, and
however evidenced, including without limitation those loans and financial accommodations described herein or described on any exhibit or schedule attached to this Agreement from time to time.



Note. The word Note means the Note executed by Rancor Realty Fund
V, a California Limited Partnership in the principal amount of $6,000,000.00 dated February 25, 2003, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the note or credit
agreement.



Permitted Liens. The words Permitted
Liens mean (1) liens and security interests securing Indebtedness owed by Borrower to Lender; (2) liens for taxes, assessments, or similar charges either not yet due or being contested in good faith; (3) liens of materialmen, mechanics.
warehousemen, or carriers, or other like liens arising in the ordinary course of business and securing obligations which are not yet delinquent; (4) purchase money liens or purchase money security interests upon or in any property acquired or held
by Borrower in the ordinary course of business to secure indebtedness outstanding on the date of this Agreement or permitted to be incurred under the paragraph of this Agreement fitted Indebtedness and Liens; (5) liens and security
interests which, as of the date of this Agreement, have been disclosed to and approved by the Lender in writing; and (6) those liens and security interests which in the aggregate constitute an immaterial and insignificant monetary amount with
respect to the net value of Borrowers assets.



Related
Documents. The words Related Documents mean all promissory notes, credit agreements, loan agreements. environmental agreements, guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all
other instruments, agreements and documents, whether now or hereafter existing, executed in connection with the Loan.



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BUSINESS LOAN AGREEMENT

|                   |  |             |  | 
|------------------ |  | ----------- |  | 
|Loan No: 109080155 |  | (Continued) |  | 



Security Agreement.
The words Security Agreement mean and include without limitation any agreements, promises, covenants, arrangements, understandings or other agreements, whether created by law, contract, or otherwise, evidencing, governing, representing,
or creating a Security Interest.



Security Interest. The words
Security Interest mean, without limitation, any and all types of collateral security, present and future, whether in the form of a lien, charge, encumbrance, mortgage, deed of trust, security deed, assignment, pledge, crop pledge,
chattel mortgage, collateral chattel mortgage, chattel trust, factors lien, equipment trust, conditional sale. trust receipt. lien or title retention contract, lease or consignment intended as a security device. or any other security or lien
interest whatsoever whether created by law, contract, or otherwise.



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BUSINESS LOAN AGREEMENT

|                   |  |             |  |       
|------------------ |  | ----------- |  | ------
|Loan No: 109080155 |  | (Continued) |  | Page 7



BORROWER ACKNOWLEDGES HAVING READ
ALL THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT AND BORROWER AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS DATED FEBRUARY 25, 2003.



BORROWER:



|                                         |  |                                                 
|---------------------------------------- |  | ------------------------------------------------
|FUND V, A CALIFORNIA LIMITED PARTNERSHIP
|                                         | 
|By:                                      |  | /s/ Daniel Lee Stephenson                       
|                                         |  | Daniel Lee Stephenson, General Partner of Rancon
|                                         |  | Realty Fund V, a California Limited Partnership 



RANCON FINANCIAL CORPORATION, Partner of Rancon Realty Fund V, a California Limited Partnership



|                   |  |                                            
|------------------ |  | -------------------------------------------
|                   | 
|By:                |  | /s/ Daniel Lee Stephenson                  
|                   |  | Daniel Lee Stepherison, President of Rancon
|                   |  | Financial Corporation                      
|                  
|LENDER:           
|                  
|MID-PENINSULA BANK
|                   | 
|By:                |  | /s/ Judy Paris                             
|                   |  | Authorized signer                          



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EXHIBIT A TO BUSINESS LOAN AGREEMENT



|           |  |            |  |            |  |           |  |           |  |         |  |         |  |         
|---------- |  | ---------- |  | ---------- |  | --------- |  | --------- |  | ------- |  | ------- |  | --------
|Principal  |  | Loan Date  |  | Maturity   |  | Loan No   |  | Call/Coll |  | Account |  | Officer |  | Initials
|$6,000,000 |  | 02-25-2003 |  | 03-05-2005 |  | 109080155 |  | 5050      |  |         |  | 008     |  |         



References in the
shaded area are for Lenders use only and do not limit the applicability of this document

to any particular loan or its

Any item above containing  has been omitted due to text length limitations.



|          |  |                                            |  |         |  |                    
|--------- |  | ------------------------------------------ |  | ------- |  | -------------------
|Borrower: |  | Rancon Realty Fund V, a California Limited |  | Lender: |  | Mid-Peninsula Bank 
|          |  | Partnership                                |  |         |  | Palo Alto Office   
|          |  | 400 South El Camino Real                   |  |         |  | 420 Cowper Street  
|          |  | San Mateo, CA 94402                        |  |         |  | Palo Alto, CA 94001



This EXHIBIT A TO BUSINESS
LOAN AGREEMENT is attached to and by this reference is made a part of the Business Loan Agreement, dated February 25, 2003, and executed in connection with a loan or other financial accommodations between MID-PENINSULA BANK and Rancon Realty Fund V,
a California Limited Partnership.



ADDITIONAL PROVISION



As applicable, the definition(s) of the following financial covenants and/or defined terms
contained in this Business Loan Agreement are amended to read as follows:



Working Capital. The wards Working Capital mean Borrowers current assets less current liabilities.



Tangible Net Worth. The words Tangible Net Worth mean Borrowers total assets excluding all intangible assets (i.e., goodwill, trademarks, patents,
copyrights, franchises, capitalized software, covenants not to compete, organizational costs, investments, employee/owner and intercompany accounts receivable and similar intangible items) less total debt, excluding subordinated debt.



Cash Flow. The words Cash Flow mean Borrowers net income after taxes,
exclusive of extraordinary gains and income, plus depreciation and amortization less cash dividends, distributions and withdrawals, and repurchase of treasury stock.



Debt / Worth Ratio. The ratio Debt / Worth means Borrowers Total Liabilities, excluding subordinated debt, divided by
Borrowers Tangible Net Worth.



THIS EXHIBIT A TO BUSINESS
LOAN AGREEMENT IS EXECUTED ON FEBRUARY 25, 2003.



BORROWER:



RANCON REALTY FUND V, A CALIFORNIA LIMITED
PARTNERSHIP L



|    |  |                                                 
|--- |  | ------------------------------------------------
|By: |  | /s/ Daniel Lee Stephenson                       
|    |  | Daniel Lee Stephenson, General Partner of Rancon
|    |  | Realty Fund V, a California Limited Partnership 



RANCON.FMNCIAL CORPORATION, Partner of Rancon Realty Fund V, a California Limited Partnership



|                   |  |                                           
|------------------ |  | ------------------------------------------
|By:                |  | /s/ Daniel Lee Stephenson                 
|                   |  | Daniel Lee Stephenson, President of Rancon
|                   |  | Financial Corporation                     
|                  
|LENDER:           
|                  
|MID-PENINSULA BANK
|                   | 
|By:                |  | /s/ Judy Paris                            
|                   |  | Authorized Signer