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EXHIBIT 10.18    
  

 
 

STANDARD MULTI-TENANT OFFICE LEASE—GROSS
  
    AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION    
  

1.  Basic Provisions ("Basic Provisions").  

    1.1  Parties:  This Lease
("Lease"), dated for reference purposes only, October 9, 2000, is made by and between S&F HUNTINGTON MILLENNIUM LLC
("Lessor") and SEEBEYOND TECHNOLOGIES CORP., INC. ("Lessee"), (collectively the
"Parties", or individually a "Party"). 

    1.2(a)  Premises:  That certain portion of the Project (as defined below), known
as Suite Number(s) 110, 1st and 2nd floor(s), consisting of approximately 57,481 rentable square feet and approximately to be determined useable square feet
("Premises"). The Premises are located at: 181 West Huntington Drive, in the City of Monrovia, County of Los Angeles, State of California, with zip code
91016. In addition to Lessee's rights to use and occupy the Premises as hereinafter specified, Lessee shall have non-exclusive rights to the Common Areas (as defined in Paragraph 2.7 below) as
hereinafter specified, but shall not have any rights to the roof, the exterior walls, the area above the dropped ceilings, or the utility raceways of the building containing the Premises
("Building") or to any other buildings in the Project. The Premises, the Building, the Common Areas, the land upon which they are located, along with
all other buildings and improvements thereon, are herein collectively referred to as the "Project." The Project consists of approximately 105,159
rentable square feet. (See also Paragraph 2) Actual square footages are subject to confirmation upon completion of building construction. 

    1.2(b)  Parking:  190/125* unreserved and -0- reserved vehicle parking spaces at
a monthly cost of $-0- per unreserved space and $-0- per reserved space. (See Paragraph 2.6) 

*  Lessor shall provide to Lessee one hundred ninety (190) stalls Monday-Friday; one hundred twenty-five (125) stalls Saturday-Sunday. 

    1.3  Term:  Five (5) years and Zero (0) months ("Original
Term") commencing February 1, 2001 (subject to space plan completion by November 21, 2000) ("Commencement Date")
and ending January 31, 2006 ("Expiration Date"). (See also Paragraph 3) 

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

    1.5  Base Rent:  $112,087.95** per month ("Base
Rent"), payable on the 1st day of each month commencing February 1, 2001. (See also Paragraph 4) 

**  $1.95/square foot FSG of which $.16/square foot is allocated to submetered electrical service.

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

    1.6  Lessee's Share of Operating Expense Increase:  To be determined within 60
days of completion of building shell and core percent (  %) ("Lessee's Share"). Lessee's Share has been calculated by dividing the
approximate square footage of rentable space contained in the Project and shall not be subject to revision except in connection with an actual change in the size of the Premises or a change in the
space available for lease in the Project. 

    1.7  Base Rent and Other Monies Paid Upon Execution:  

(a)  Base Rent:  $112,087.95* for the period February 1-28, 2001.
 *$37,087.95 shall be applied to March's base rent.

(b)  Security Deposit:  $112,088.00 ("Security Deposit"). (See also
Paragraph 5) 

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(c)  Parking:  $-0- for the period N/A. 

(d)  Other:  $-0- for N/A. 

(e)  Total Due Upon Execution of this Lease:  $224,175.95. 

    1.8  Agreed Use:  Office/R&D and High Technology Manufacturing. (See also
Paragraph 6) 

    1.9  Base Year; Insuring Party:  The Base Year is 2001. Lessor is the
"Insuring Party". (See also Paragraphs 4.2 and 8) 

    1.10  Real Estate Brokers: (See also Paragraph 15) 

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

/ /                        represents Lessor exclusively ("Lessor's Broker");

/x/  CRESA PARTNERS LLC represents Lessee exclusively ("Lessee's Broker"); or 

/ /                        represents both Lessor and Lessee ("Dual Agency").

(b)  Payment to Brokers:  Upon execution and delivery of this Lease by both Parties, Lessor shall pay to the Brokers the
brokerage fee agreed to in a separate written agreement (or if there is no such agreement, the sum of - or 4% of the total Base Rent for the brokerage services rendered by the Brokers). 

    1.11  Guarantor.  The obligations of the Lessee under this Lease shall be
guaranteed by                       ("Guarantor"). (See also Paragraph 37) 

    1.12  Business Hours for the Building:  7:30 a.m. to 6:30 p.m., Mondays through
Fridays (except Building Holidays) and - a.m. to - p.m. on Saturdays (except Building Holidays). "Building Holidays" shall mean the dates of observation
of New Year's Day, President's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, Christmas Day, and N/A. Lessee shall have use of the Premises and its operating
systems 24/7.

    1.13  Lessor Supplied Services.  Notwithstanding the provisions of
Paragraph 11.1, Lessor is NOT obligated to provide the following: 

/ /  Janitorial services  

/ /  Electricity  

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

/x/ an Addendum consisting of Paragraphs 54 through 55;  

/x/ a plot plan depicting the Premises;  

/x/ a current set of the Rules and Regulations;  

/ / a Work Letter;  

/x/ a janitorial schedule;  

/ / other (specify);  

 2.  Premises.  

    2.1  Letting.  Lessor hereby leases to Lessee, and Lessee hereby leases from
Lessor, the Premises, for the term, at the rental, and upon all of the terms, covenants and conditions set forth in 

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this Lease. Unless otherwise provided herein, any statement of size set forth in this Lease, or that may have been used in calculating Rent, is an approximation which the Parties agree is reasonable
and any payments based thereon are not subject to revision whether or not the actual size is more or less. Note: Lessee is advised to verify the actual size prior to executing
this Lease.

    2.2  Condition.  Lessor shall deliver the Premises to Lessee in a clean condition
on the Commencement Date or the Early Possession Date, whichever first occurs ("Start Date"), and warrants that the existing electrical, plumbing, fire
sprinkler, lighting, heating, ventilating and air conditioning systems ("HVAC"), and all other items which the Lessor is obligated to construct pursuant
to the Work Letter attached hereto, if any, other than those constructed by Lessee, shall be in good operating condition on said date. 

    2.3  Compliance.  Lessor warrants that the improvements comprising the Premises
and the Common Areas comply with the building codes that were in effect at the time that each such improvement, or portion thereof, was constructed, and also with all applicable laws, covenants or
restrictions of record, regulations, and ordinances ("Applicable Requirements") in effect on the Start Date. Said warranty does not apply to the use to
which Lessee will put the Premises, modifications which may be required by the Americans with Disabilities Act or any similar laws as a result of Lessee's use (see Paragraph 50), or to any
Alterations or Utility Installations (as defined in Paragraph 7.3(a)) made or to be made by
Lessee. NOTE: Lessee is responsible for determining whether or not the zoning and other Applicable Requirements are appropriate for Lessee's intended use, and acknowledges that
past uses of the Premises may no longer be allowed. If the Premises do not comply with said warranty, Lessor shall, except as otherwise provided, promptly after receipt of
written notice from Lessee setting forth with specifically the nature and extent of such non-compliance, rectify the same. If the Applicable Requirements are hereafter changed so as to require during
the term of this Lease the construction of an addition to or an alteration of the Premises, the remediation of any Hazardous Substance, or the reinforcement or other physical modification of the
Premises ("Capital Expenditure"), Lessor and Lessee shall allocate the cost of such work as follows: 

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

    (b) 

    (c) Notwithstanding
the above, the provisions concerning Capital Expenditures are intended to apply only to nonvoluntary, unexpected, and new Applicable Requirements.
If the Capital Expenditures are instead triggered by Lessee as a result of an actual or proposed change in use, change in intensity of use, or modification to the Premises then, and in that event,
Lessee shall be fully responsible for the cost thereof, and Lessee shall not have any right to terminate this Lease. 

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

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    2.6  Vehicle Parking.  So long as Lessee is not in default, and subject to the
Rules and Regulations attached hereto, and as established by Lessor from time to time, Lessee shall be entitled to rent and
use the number of parking spaces specified in Paragraph 1.2(b) at the rental rate applicable from time to time for monthly parking as set by Lessor and/or its licensee. 

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

    2.7  Common Areas—Definition.  The term
"Common Areas" is defined as all areas and facilities outside the Premises and within the exterior boundary line of the Project and interior utility
raceways and installations within the Premises that are provided and designated by the Lessor from time to time for the general nonexclusive use of Lessor, Lessee and other tenants of the Project and
their respective employees, suppliers, shippers, customers, contractors and invitees, including, but not limited to, common entrances, lobbies, corridors, stairwells, public restrooms, elevators,
parking areas, loading and unloading areas, trash areas, roadways, walkways, driveways and landscaped areas. 

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

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

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

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

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

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

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

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

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

3.  Term.  

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

    3.2  Early Possession.  If Lessee totally or partially occupies the Premises
prior to the Commencement Date, the obligation to pay Base Rent shall be abated for the period of such early possession. All other forms of this Lease (including but not limited to the obligations to
pay Lessee's Share of the Operating Expense Increase) shall, however, be in effect during such period. Any such early possession shall not affect the Expiration Date. 

    3.3  Delay in Possession.  Lessor agrees to use its best commercially reasonable
efforts to deliver possession of the Premises to Lessee by the Commencement Date. (Lease starts February 1, 2001—Tenant improvements done by March 1, 2001) if, despite said efforts, Lessor
is unable to deliver possession by such date, Lessor shall not be subject to any liability therefor, nor shall such failure affect the validity of this Lease. Lessee shall not, however be obligated to
pay Rent or perform its other obligations until Lessor delivers possession of the Premises and any period of rent abatement that Lessee would otherwise have enjoyed shall run from the date of delivery
of possession and continue for a period equal to what Lessee would otherwise have enjoyed under the terms hereof, but minus any days of delay caused by the acts or omissions of Lessee. If possession
is not delivered within 60 days after the Commencement Date, as the same may be extended under the terms of any Work Letter executed by Parties, Lessee may, at its option, by notice in writing within
10 days after the end of such 60 day period, cancel this Lease, in which event the Parties shall be discharged from all obligations hereunder. If such written notice is not received by Lessor within
said 10 day period, Lessee's right to cancel shall terminate. If possession of the Premises is not delivered within 120 days after the Commencement Date, this Lease shall terminate unless other
agreements are reached between Lessor and Lessee, in writing. 

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

4.  Rent.  

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

    4.2  Operating Expense Increase.  Lessee shall pay to Lessor during the term
hereof, in addition to the Base Rent, Lessee's Share of the amount by which all Operating Expenses for each Comparison 

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Year exceeds the amount of all Operating Expenses for the Base Year, such excess being hereinafter referred to as the "Operating Expense Increase", in accordance with the following provisions: 

    (a) "Base Year" is as specified in Paragraph 1.9. 

    (b) "Comparison Year" is defined as each calendar year during the term of this Lease subsequent to the Base Year,
provided, however, Lessee shall have no obligation to pay a share of the Operating Expense Increase applicable to the first 12 months of the Lease Term (other than such as are mandated by a
governmental authority, as to which government mandated expenses Lessee shall pay Lessee's Share, notwithstanding they occur during the first twelve (12) months). Lessee's share of the Operating
Expense Increase for the first and last Comparison Years of the Lease Term shall be prorated according to that portion of such Comparison Year as to which Lessee is responsible for a share of such
increase. 

    (c) "Operating Expenses" include all costs incurred by Lessor relating to the ownership and operation of the Project,
calculated as if the Project was at least 95% occupied, including, but not limited to, the following: 

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

    (aa) The
Common Areas, including their surfaces, coverings, decorative items, carpets, drapes and window coverings, and including parking areas, loading and unloading
areas, trash areas, roadways, sidewalks, walkways, stairways, parkways, driveways, landscaped areas, striping, bumpers, irrigation systems, Common Area lighting facilities, building exteriors and
roofs, fences and gates; 

    (bb) All
heating, air conditioning, plumbing, electrical systems, life safety equipment, communication systems and other equipment used in common by, or for the benefit
of, lessees or occupants of the Project, including elevators and escalators, tenant directories, fire detection systems including sprinkler system maintenance and repair. 

    (ii) Trash
disposal, janitorial and security services, pest control services, and the costs of any environmental inspections; 

    (iii) Any
other service to be provided by Lessor that is elsewhere in this Lease stated to be an "Operating Expense"; 

    (iv) The
cost of the premiums for the insurance policies maintained by Lessor pursuant to paragraph 8 and any deductible portion of an insured loss concerning the
Building or the Common Areas; 

    (v) The
amount of the Real Property Taxes payable by Lessor pursuant to paragraph 10; 

    (vi) The
cost of water, sewer, gas, electricity, and other publicly mandated services not separately metered; 

    (vii) Labor,
salaries, and applicable fringe benefits and costs, materials, supplies and tools, used in maintaining and/or cleaning the Project and accounting and
management fees attributable to the operation of the Project; 

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

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    (ix) Replacement of equipment or improvements that have a useful life for accounting purposes of 5 years or less. 

    (d) Any
item of Operating Expense that is specifically attributable to the Premises, the Building or to any other building in the Project or to the operation, repair
and maintenance thereof, shall be allocated
entirely to such Premises, Building, or other building. However, any such item that is not specifically attributable to the Building or to any other building or to the operation, repair and
maintenance thereof, shall be equitably allocated by Lessor to all buildings in the Project. 

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

    (f)  Lessee's
Share of Operating Expense Increase shall be payable be Lessee within 10 days after a reasonably detailed statement of actual expenses is presented to
Lessee by Lessor. At Lessor's option, however, an amount may be estimated by Lessor from time to time in advance of Lessee's Share of the Operating Expense Increase for any Comparison Year, and the
same shall be payable monthly during each Comparison Year of the Lease term, on the same day as the Base Rent is due hereunder. In the event that Lessee pays Lessor's estimate of Lessee's Share of
Operating Expense Increase as aforesaid, Lessor shall deliver to Lessee within 60 days after the expiration of each Comparison Year a reasonably detailed statement showing Lessee's Share of the actual
Operating Expense Increase incurred during such year. If Lessee's payments under this paragraph (f) during said Comparison Year exceed Lessee's Share as indicated on said statement, Lessee shall be
entitled to credit the amount of such overpayment against Lessee's Share of Operating Expense Increase next falling due. If Lessee's payments under this paragraph during said Comparison Year were less
than Lessee's Share as indicated on said statement, Lessee shall pay to Lessor the amount of the deficiency within 10 days after delivery by Lessor to Lessee of said statement. Lessor and Lessee shall
forthwith adjust between them by cash payment any balance determined to exist with respect to that portion of the last Comparison Year for which Lessee is responsible as to Operating Expense
Increases, notwithstanding that the Lease term may have terminated before the end of such Comparison Year. 

    (g) Operating
Expenses shall not include the costs of replacement for equipment or capital components such as the roof, foundations, exterior walls or a Common Area
Capital improvement, such as the parking lot paving, elevators, fences that have a useful life for accounting purposes of 5 years or more unless it is of the type described in paragraph 4.2(c)
(viii), in which case their cost shall be included as above provided. 

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

    4.3  Payment.  Lessee shall cause payment of Rent to be received by Lessor in
lawful money of the United States on or before the day on which it is due, without offset or deduction (except as specifically permitted in this Lease). Rent for any period during the term hereof
which is for less than one full
calendar month shall be prorated based upon the actual number of days of said month. Payment of Rent shall be made to Lessor at its address stated herein or to such other persons or place as Lessor
may from time to time designate in writing. Acceptance of a payment which is less than the amount than due shall not be a waiver of Lessor's rights to the balance of such Rent, regardless of Lessor's
endorsement of any check so stating. In the event that any check, draft, or other instrument of payment given by Lessee to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor the 

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sum of $25 in addition to any Late Charge. Payments will be applied first to accrued late charges and attorney's fees, second to accrued interest, then to Base Rent and Operating Expense Increase, and
any remaining amount to any other outstanding charges or costs. 

5.  Security Deposit.  

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

6.  Use.  

    6.1  Use.  Lessee shall use and occupy the Premises only for the Agreed Use, or
any other legal use which is reasonably comparable thereto, and for no other purpose. Lessee shall not use or permit the use of the Premises in a manner that is unlawful, creates damage, waste or a
nuisance, or that disturbs occupants of or causes damage to neighboring premises or properties. Lessor shall not unreasonably withhold or delay its consent to any written request for a modification of
the Agreed Use, so long as the same will not impair the structural integrity of the Improvements of the Building, will not adversely affect the mechanical, electrical, HVAC, and other systems of the
Building, and/or will not affect the exterior appearance of the Building. If Lessor elects to withhold consent, Lessor shall within 7 days after such request give written notification of same, which
notice shall include an explanation of Lessor's objections to the change in the Agreed Use. 

    6.2  Hazardous Substances.  

    (a) Reportable Uses Require Consent. The term "Hazardous Substance" as used in this Lease shall mean any product,
substance, or waste whose presence, use, manufacture, disposal, transportation, or release, either by itself or in combination with other materials expected to be on the Premises, is either: (i)
potentially injurious to the public health, safety or welfare, the environment or the Premises, (ii) regulated or monitored by any governmental authority, or (iii) a basis for potential liability of
Lessor to any governmental agency or third party under any applicable statute or common law theory. Hazardous Substances shall include, but not be limited 

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

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

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

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

Page 9

 

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

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

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

    6.3 Lessee's Compliance with Applicable Requirements. Except as otherwise provided in this Lease, Lessee shall, at
Lessee's sole expense, fully, diligently and in a timely manner, materially comply with all Applicable Requirements, the requirements of any applicable fire insurance underwriter or rating bureau, and
the recommendations of Lessor's engineers and/or consultants, which refer in any manner to the Premises, without regard to whether said requirements are now in effect or become effective after the
Start Date. Lessee shall, within 10 days after receipt of Lessor's written request, provide Lessor with copies of all permits and other documents, and other information evidencing Lessee's compliance
with any Applicable Requirements specified by Lessor, and shall immediately upon receipt, notify Lessor in writing (with copies of any documents involved) of any threatened or actual claim, notice,
citation, warning, complaint or report pertaining to or involving the failure of Lessee or the Premises to comply with any Applicable Requirements. (Building is new and complies completely today) 

Page 10

 

    6.4 Inspection; Compliance. Lessor and Lessor's "Lender" (as defined in
Paragraph 30) and consultants shall have the right to enter into Premises at any time, in the case of an emergency, and otherwise at reasonable times, for the purpose of inspecting the condition of
the Premises and for verifying compliance by Lessee with this Lease. The cost of any such inspections shall be paid by Lessor, unless a violation of Applicable Requirements, or a Hazardous Substance
Condition (see paragraph 9.1e) is found to exist or to be imminent, or the inspection is requested or ordered by a governmental authority. In such case, Lessee shall upon request reimburse Lessor for
the cost of such inspection, so long as such inspection is reasonably related to the violation or contamination. 

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

    7.1  Lessee's Obligations.  Notwithstanding Lessor's
obligation to keep the Premises in good condition and repair, Lessee shall be responsible for payment of the cost thereof to Lessor as additional rent for that portion of the cost of any maintenance
and repair to the Premises, or any equipment (wherever located) that serves only Lessee or the Premises, to the extent such cost is attributable to causes beyond normal wear and tear. Lessee shall be
responsible for the cost of painting, repairing or replacing wall coverings, and to repair or replace any improvements with the Premises. Lessor may, at its option, upon reasonable notice, elect to
have Lessee perform any particular such maintenance or repairs the cost of which is otherwise Lessee's responsibility hereunder. 

    7.2  Lessor's Obligations.  Subject to the provisions of Paragraphs 2.2
(Condition), 2.3 (Compliance), 4.2 (Operating Expenses), G (Use). 7.1 (Lessee's Obligations), D (Damage or Destruction) and 14 (Condemnation), Lessor, subject to reimbursment pursuant to
Paragraph 4.2, shall keep in good order, condition and repair the foundations, exterior walls, structural condition of interior bearing walls, exterior roof, fire sprinkler system, fire alarm and/or
smoke detection systems, fire hydrants, and the Common Areas. Lessee expressly waives the benefit of any statute now or hereafter in effect to the extent it is inconsistent with the terms of this
Lease. 

    7.3  Utility Installations; Trade Fixtures; Alterations.  

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

    
(b) Consent. Lessee shall not make any Alterations or Utility Installations to the Premises without Lessor's prior written consent.
Lessee may, however, make non-structural Utility Installations to the interior of the Premises (excluding the roof) without such consent but upon notice to Lessor, as long as they are not visible from
the outside, do not involve puncturing, relocating or removing the roof, ceilings, floors or any existing walls, will not affect the electrical, plumbing, HVAC, and/or life safety systems, and the
cumulative cost thereof during this Lease as extended does not exceed $2000. Notwithstanding the foregoing, Lessee shall not make or permit any roof penetrations and/or install anything on the roof
without the prior written approval of Lessor. Lessor may, as a precondition to granting such approval, require Lessee to utilize a contractor chosen and/or approved by Lessor. Any Alterations or
Utility Installations that Lessee shall desire to make and which require the consent of the Lessor shall be presented to Lessor in written form with detailed plans. Consent shall be deemed conditioned
upon Lessee's: (i) acquiring all applicable governmental permits, (ii) furnishing Lessor with copies of both the permits and the 

Page 11

 

plans and specifications prior to commencement of the work, and (iii) compliance with all conditions of said permits and other Applicable Requirements in a prompt and expeditious manner. Any
Alterations or Utility Installations shall be performed in a workmanlike manner with good and sufficient materials. Lessee shall promptly upon completion furnish Lessor with asbuilt plans and
specifications. For work which costs an amount in excess of one month's Base Rent, Lessor may condition as consent upon Lessee, providing a lien and completion bond in an amount equal to 150% of the
estimated cost of such Alteration or Utility Installation and/or upon Lessee's posting an additional Security Deposit and Lessor. 

Page 12

  

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

    7.4  Ownership; Removal; Surrender; and Restoration.  

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

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

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

8.  Insurance; Indemnity.  

    8.1  Insurance Premiums.  The cost of the premiums for the insurance policies
maintained by Lessor pursuant to paragraph 8 are included as Operating Expenses (see paragraph 4.2 (c)(iv)). Said costs shall include increases in the premiums resulting from additional coverage
related to requirements of the holder of a mortgage or deed of trust covering the Premises, Building and/or Project, increased valuation of the Premises, Building and/or Project, and/or a general
premium rate increase. Said costs shall not, however, include any premium increases resulting from the nature of the occupancy of any 

Page 12

 

other tenant of the Building. If the Project was not insured for the entirety of the Base Year, then the base premium shall be the lowest annual premium reasonably obtainable for the required
insurance as of the Start Date, assuming the most nominal use possible of the Building and/or Project. In no event, however, shall Lessee be responsible for any portion of the premium cost
attributable to liability insurance coverage in excess of $2,000,000 procured under Paragraph 8.2(b). 

    8.2  Liability Insurance.  

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

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

    8.3  Property Insurance—Building, Improvements and Rental Value.  

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

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

Page 13

 

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

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

    8.4  Lessee's Property; Business Interruption Insurance.  

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

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

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

    8.5  Insurance Policies.  Insurance required herein shall be by companies duly
licensed or admitted to transact business in the state where the Premises are located, and maintaining during the policy term a "General Policyholders Rating" of at least B+, V, as set forth in the
most current issue of "Best's Insurance Guide", or such other rating as may be required by a Lender. Lessee shall not do or permit to be done anything which invalidates the required insurance
policies. Lessee shall, prior to the Start Date, deliver to Lessor certified copies of such insurance or certificates evidencing the existence and amounts of, XXX. Lessee shall, at least
thirty (30) days prior to the expiration of such policies, furnish Lessor with evidence of renewals or "insurance binders" evidencing renewal thereof, or Lessor may order such insurance and
charge the cost thereof to Lessee, which amount shall be payable by Lessee to Lessor upon demand. Such policies shall be for a term of at least one year, or the length of the
remaining term of this Lease, whichever is less. If either Party shall fail to procure and maintain the insurance required to be carried by it, the Other Party may, but shall not be required to,
procure and maintain the same. 

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

    8.7  Indemnity.  Except for Lessor's gross negligence or willful misconduct,
Lessee shall indemnify, protect, defend and hold harmless the Premises, Lessor and its agents, Lessor's master or ground lessor, partners and Lenders, from and against any and all claims, loss of
rents and/or damages, liens, judgments, penalties, attorneys' and consultants' fees, expenses and/or liabilities arising out of, involving, or in connection with, the use and/or occupancy of the
Premises by Lessee. If any action or proceeding is brought against Lessor by reason of any of the foregoing matters, Lessee shall upon notice defend the same at Lessee's expense by counsel reasonably
satisfactory to Lessor and Lessor 

Page 14

 

shall cooperate with Lessee in such defense. Lessor need not have first paid any such claim in order to be defended or indemnified. 

    8.8  Exemption of Lessor From Liability.  Lessor shall not be liable for injury
or damage to the person or goods, wares, merchandise or other property of Lessee, Lessee's employees, contractors, invitees, customers, or any other person in or about the Premises, whether such
damage or injury is caused by or results from fire, steam, electricity, gas, water or rain, or from the breakage, leakage, obstruction or other defects of pipes, fire sprinklers, wires, appliances,
plumbing, HVAC or lighting fixtures, or from any other cause, whether the said injury or damage results from conditions arising upon the Premises or upon other portions of the Building, or from other
sources or places. Lessor shall not be liable for any damages arising from any act or neglect of any other tenant of Lessor nor from the failure of Lessor to enforce the provisions of any other lease
in the Project. Notwithstanding Lessor's negligence or breach of this Lease, Lessor shall under no circumstances be liable for injury to Lessee's business or for any loss of income or profit
therefrom. Lessor shall maintain the Premises in good working order. If, through any negligence or willful misconduct on the part of the Lessor, any of the operating systems named in the
aforementioned paragraph harm anyone or damage Lessee's business, Lessee shall not be responsible. 

9.  Damage or Destruction.  

    9.1  Definitions.  

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

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

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

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

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

    9.2  Partial Damage—Insured Loss.  If Premises Partial Damage that is
an Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such damage (but not Lessee's Trade Fixtures or Lessee Owned
Alterations and Utility Installations) as soon as reasonably possible and this Lease shall continue in full force and effect, provided, however, that Lessee shall, at Lessor's election, make the
repair of any damage or destruction the total cost to repair of which is $5,000 or less, and, in such 

Page 15

 

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

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

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

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

Page 16

 

such funds or assurance during such period, then this Lease shall terminate on the date specified in the termination notice and Lessee's option shall be extinguished. 

    9.6  Abatement of Rent; Lessee's Remedies.  

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

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

    9.7  Termination; Advance Payments.  Upon termination of this Lease pursuant to
Paragraph 5.2(g) or Paragraph 9, an equitable adjustment shall be made concerning advance Base Rent and any other advance payments made by Lessee or Lessor. Lessor shall, in addition, return to Lessee
so much of Lessee's Security Deposit as has not been, or is not then required to be, used by Lessor. 

    9.8  Waive Statutes.  Lessor and Lessee agree that the terms of this Lease shall
govern the effect of any damage to or destruction of the Premises XXX. 

10. Real Property Taxes.  

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

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

    10.3  Additional Improvements.  Operating Expenses shall not include Real
Property Taxes specified in the tax assessor's records and work sheets as being caused by additional improvements placed upon the Project by other lessees or by Lessor for the exclusive enjoyment of
such other lessees. Notwithstanding Paragraph 10.2 hereof, Lessee shall, however, pay to Lessor at the time Operating Expenses are payable under Paragraph 4.2, the entirety of any increase in Real
Property Taxes if 

Page 17

 

assessed solely by reason of Alterations, Trade Fixtures or Utility Installations placed upon the Premises by Lessee or at Lessee's request. 

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

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

11. Utilities and Services.  

    11.1  Services Provided by Lessor.  Lessor shall provide heating, ventilation,
air conditioning, reasonable amounts of electricity for normal lighting and office machines, water for reasonable and normal drinking and lavatory use in connection with an office, and replacement
light bulbs and/or fluorescent tubes and ballasts for standard overhead fixtures. Lessor shall also provide janitorial services to the Premises and Common Areas 5 times per week, excluding Building
Holidays, or pursuant to the attached janitorial schedule, if any. Lessor shall not, however, be required to provide janitorial services to storage areas included within the Premises. HVAC operation
hours are Monday - Friday 7:30 a.m. - 6:30 p.m. 

    11.2  Services Exclusive to Lessee.  Lessee shall pay for all water, gas, heat,
light, power, telephone and other utilities and services specially or exclusively supplied and/or metered exclusively to the Premises or to Lessee, together with any taxes thereon. If a service is
deleted by Paragraph 1.13 and such service is not separately metered to the Premises, Lessee shall pay at Lessor's option, either Lessee's Share or a
reasonable proportion to be determined by Lessor of all charges for such jointly metered service. 

    11.3  Hours of Service.  Said services and utilities shall be provided during
times set forth in Paragraph 1.12. Utilities and services required at other times shall be subject to advance request and reimbursement by Lessee to Lessor of the cost thereof. Normal electrical
service, including lighting shall be available to Tenant on a 24/7 day per week basis. 

    11.4  Excess Usage by Lessee.  Lessee shall not make connection to the utilities
except by or through existing outlets and shall not install or use machinery or equipment in or about the Premises that uses excess water, or suffer or permit any act that causes extra burden upon the
utilities or services, including but not limited to security and trash services, over standard office usage for the Project. Lessor shall require Lessee to reimburse Lessor for any excess expenses or
costs that may arise out of a breach of this subparagraph by Lessee. Lessor may, in its sole discretion, install at Lessee's expense supplemental equipment and/or separate metering applicable to
Lessee's excess usage or loading. 

    11.5  Interruptions.  There shall be no abatement of rent and Lessor shall not be
liable in any respect whatsoever for the inadequacy, stoppage, interruption or discontinuance of any utility or service due to riot, strike, labor dispute, breakdown, accident, repair or other cause
beyond Lessor's reasonable control or in cooperation with governmental request or directions. 

Page 18

 

12. Assignment and Subletting.  

	12.1
	Lessor's Consent Required.

	(a)
	Lessee
shall not voluntarily or by operation of law assign, transfer, mortgage or encumber (collectively, "assign or assignment") or
sublet all or any part of Lessee's interest in this Lease or in the Premises without Lessor's prior written consent. Any net profits resulting from a sublease will be split 50%/50% between Lessor and
Lessee.

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

	(c)
	The
involvement of Lessee or its assets in any transaction, or series of transactions (by way of merger, sale, acquisition, financing, transfer, leveraged buyout or otherwise),
whether or not a formal assignment or hypothecation of this Lease or Lessee's assets occurs, which results or will result in a reduction of the Net Worth of Lessee to below $200,000,000 market
capitalization of such Net Worth as it was represented at the time of the execution of this Lease or at the time of the most recent assignment to which Lessor has consented, or as it exists
immediately prior to said transaction or transactions constituting such reduction, whichever was or is greater, shall be considered an assignment of this Lease to which Lessor may withhold its
consent. "Net Worth of Lessee" shall mean the net worth of Lessee (excluding any guarantors) established under generally accepted accounting principles.

	(d)
	An
assignment or subletting of 50% of Lessee's space or more without consent shall, at Lessor's option, be a Default curable after notice per Paragraph 13.1(c), or a noncurable
Breach without the necessity of any notice and grace period. If Lessor elects to treat such unapproved assignment or subletting as a noncurable Breach, Lessor may either: (i) terminate this
Lease, or (ii) upon 30 days written notice, increase the monthly Base Rent to 110% of the Base Rent then in effect. Further, in the event of such Breach and rental adjustment, (i) the purchase price
of any option to purchase the Premises held by Lessee shall be subject to similar adjustment to 110% of the price previously in effect, and (ii) all fixed and non-fixed rental adjustments scheduled
during the remainder of the Lease term shall be increased in 110% of the scheduled adjusted rent.

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

	12.2
	Terms and Conditions Applicable to Assignment and Subletting.

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

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

Page 19

 

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

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

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

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

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

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

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

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

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

Page 20

 

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

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

13. Default; Breach; Remedies.  

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

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

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

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

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

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

Page 21

 

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

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

    13.2  Remedies.  If Lessee fails to perform any of its affirmative duties or
obligations, within 10 days after written notice (or in case of an emergency, without notice), Lessor may, at its option, perform such duty or obligation on Lessee's behalf, including but not limited
to the obtaining of reasonably required bonds, insurance policies, or governmental licenses, permits or approvals. The costs and expenses of any such performance by Lessor shall be due and payable by
Lessee upon receipt of invoice therefor. If any check given to Lessor by Lessee shall not be honored by the bank upon which it is drawn, Lessor, at its option, may require all future payments to be
made by Lessee to be by cashier's check. In the event of a Breach, Lessor may, with or without further notice or demand, and without limiting Lessor in the exercise of any right or remedy which Lessor
may have by reason of such Breach: 

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

Page 22

 

run
concurrently, and the failure of Lessee to cure the Default within the greater of the two such grace periods shall constitute both an unlawful detainer and a Breach of this Lease entitling Lessor
to the remedies provided for in this Lease and/or by said statute. 

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

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

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

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

    13.6  Breach by Lessor.  

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

	(b)
	Performance by Lessee on Behalf of Lessor.  In the event that neither Lessor nor Lender cures said breach within 30
days after receipt of said notice, or if having commenced said cure they do not diligently pursue it to completion, then Lessee may elect to cure said breach at Lessee's expense and offset from Rent
the actual and reasonable cost to 

Page 23

 

perform
such cure, provided, however, that such offset shall not exceed an amount equal to the greater of one month's Base Rent or the Security Deposit, reserving Lessee's right to seek reimbursement
from Lessor. Lessee shall document the cost of said cure and supply said documentation to Lessor. 

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

Page 24

   15. Brokerage Fees.  

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

    15.2  Assumption of Obligations.  Any buyer or transferee of Lessor's interest in this Lease shall be
deemed to have assumed Lessor's obligation hereunder. Brokers shall be third party beneficiaries of the provisions of Paragraphs 1, 10, 15, 22 and 31. If Lessor fails to pay to Brokers
any amounts due as and for brokerage fees pertaining to this Lease when due, then such amounts shall accrue interest. In addition, if Lessor fails to pay any amounts to Lessee's Broker when due,
Lessee's Broker may send written notice to Lessor and Lessee of such failure and if Lessor fails to pay such amounts within 10 days after said notice, Lessee shall pay said monies to its Broker
and offset such amounts against Rent. In addition, Lessee's Broker shall be deemed to be a third party beneficiary of any commission agreement entered into by and/or between Lessor and Lessor's Broker
for the limited purpose of collecting any brokerage fee owed. 

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

16. Estoppel Certificates.  

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

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

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

Page 25

 

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

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

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

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

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

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

23. Notices.  

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

    23.2  Date of Notice.  Any notice sent by registered or certified mail, return receipt requested, shall
be deemed given on the date of delivery shown on the receipt card, or if no delivery date is shown, the postmark thereon. If sent by regular mail the notice shall be deemed given 48 hours after 

Page 26

 

the same is addressed as required herein and mailed with postage prepaid. Notices delivered by United States Express Mail or overnight courier that guarantee next day delivery shall be deemed given
24 hours after delivery of the same to the Postal Service or courier. Notices transmitted by facsimile transmission or similar means shall be deemed delivered upon telephone confirmation of
receipt (confirmation report from fax machine is sufficient), provided a copy is also delivered via delivery or mail. If notice is received on a Saturday, Sunday or legal holiday, it shall be deemed
received on the next business day. 

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

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

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

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

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

    (iii) Agent Representing Both Lessor and Lessee.  A real estate agent, either acting directly or through
one or more associate licenses, can legally be the agent of both the Lessor and the Lessee in a transaction, but only with the knowledge and consent of both the Lessor and the Lessee. In a dual agency
situation, the agent has the following affirmative obligations to both 

Page 27

 

the Lessor and the Lessee. a. A fiduciary duty of utmost care, integrity, honesty and loyalty in dealings with either Lessor or the Lessee. b. Other duties to the Lessor and the Lessee as stated above
in subparagraphs (i) or (ii). In representing both Lessor and Lessee, the agent may not without the express permission of the respective Party, disclose to the other Party that the Lessor will accept
rent in an amount less than that indicated in the listing or that the Lessee is willing to pay a higher rent than that offered. The above duties of the agent in a real estate transaction do not
relieve a Lessor or Lessee from the responsibility to protect their own interests. Lessor and Lessee should carefully read all agreements to assure that they adequately express their understanding of
the transaction. A real estate agent is a person qualified to advise about real estate. If legal or tax advise is desired, consult a competent professional. 

    (b) Brokers
have no responsibility with respect to any default or breach hereof by either Party. The liability (including court costs and attorneys' fees), of any
Broker with respect to any breach of duty, error or omission relating to this Lease shall not exceed the fee received by such Broker pursuant to this Lease; provided, however, that the foregoing
limitation on each Broker's liability shall not be applicable to any gross negligence or willful misconduct of such Broker. 

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

    26.  No Right To Holdover.  Lessee has no right to retain possession of the Premises or any part thereof
beyond the expiration or termination of this Lease. In the event that Lessee holds over, then the Base Rent shall be increased to 125% of the Base Rent applicable immediately preceding the expiration
or termination. Nothing contained herein shall be construed as consent by Lessor to any holding over by Lessee. 

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

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

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

30. Subordination; Attornment; Non-Disturbance.  

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

Page 28

 

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

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

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

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

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

Page 29

 

time place on the Premises any ordinary "For Sale" signs and Lessor may during the last 6 months of the term hereof place on the Premises any ordinary
"For Lease" signs. In addition, Lessor shall have the right to retain keys to the Premises and to unlock all doors in or upon the Premises other than to
files, vaults and safes, and in the case of emergency to enter the Premises by any reasonably appropriate means, and any such entry shall not be deemed a forcible or unlawful entry or detainer of the
Premises or an eviction. Lessee waives any charges for damages or injuries or interference with Lessee's property or business in connection therewith. 

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

    34.  Signs.  Lessee shall not place any sign upon the Project without Lessor's prior written consent. 

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

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

37. Guarantor.  

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

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

Page 30

 

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

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

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

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

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

    39.4  Effect of Default on Options.  

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

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

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

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

41. Reservations.  

    (a) Lessor
reserves the right: (i) to grant, without the consent or joinder of Lessee, such easements, rights and dedications that Lessor deems necessary, (ii) to cause
the recordation of parcel maps and restrictions, (iii) to create and/or install new utility raceways, so long as such easements, rights, dedications, maps, restrictions, and utility raceways do not
unreasonably interfere with the use of the Premises by Lessee. Lessor may also change the name, address or title of the Building or Project upon at least 90 days prior written notice; provide and
install, at Lessee's expense. Building standard graphics on the door of the Premises and such portions of the Common Areas as Lessor shall reasonably deem appropriate; grant to any lessee the
exclusive 

Page 31

 

right to conduct any business as long as such exclusive right does not conflict with any rights expressly given herein; and to place such signs, notices or displays as Lessor reasonably deems
necessary or advisable upon the roof, exterior of the Building or the Project or on pole signs in the Common Areas. Lessee agrees to sign any documents reasonably requested by Lessor to effectuate
such rights. The obstruction of Lessee's view, air, or light by any structure erected in the vicinity of the Building, whether by Lessor or third parties, shall in no way affect this Lease or impose
any liability upon Lessor. 

    (b) Lessee
shall not: (i) use a representation (photographic or otherwise) of the Building or Project or their name(s) in connection with Lessee's business; or
(ii) suffer or permit anyone, except in emergency, to go upon the roof of the Building. Lessee shall have roof access to install communication system. 

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

43. Authority  

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

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

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

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

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

    47.  Multiple Parties.  If more than one person or entity is named herein as either Lessor or Lessee,
such multiple Parties shall have joint and several responsibility to comply with the terms of this Lease. 

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

Page 32

 

    49.  Mediation and Arbitration of Disputes.  An Addendum requiring the Mediation and/or the Arbitration
of all disputes between the Parties and/or Brokers arising out of this Lease / / is /x/ is not attached to this Lease. 

    50.  Americans with Disabilities Act.  In the event that as a result of Lessee's use, or intended use, of
the Premises the Americans with Disabilities Act or any similar law requires modifications of the construction or installation of improvements in or to the Premises, Building, Project and/or Common
Areas, the Parties agree that such modifications, construction or improvements shall be made at: / / Lessor's expense /x/ Lessee's expense. 

    51.  Tenant improvement Allowance.  Allowance shall be $25.00 per gross rentable square foot to include
space planning and construction of tenant improvements. All tenant improvement work shall be at no additional cost to Lessor. Tenant improvement to be done by Heil Construction, Lessor's general
contractor. There shall be three bidders on all sub-contracts over $25,000. 

    52.  Electrical Service Costs.  Lessor shall install a submeter for the electrical service to the
Premises. Lessor allocates $.16/square foot per month. Usage in excess of $.16/square foot shall be billed to Lessee as described in Section 4.2 of the Lease. Lessee shall pay Lessor such costs within
the time period specified in Section 4.2 of the Lease. 

    53.  DDA Conforming Provision.  Lessee herein covenants by and for itself that this Lease is made and
accepted upon and subject to the following conditions: 

	

/s/ BPF

 initials	

 	

/s/ BJP

 initials

Page 33

  

"There
shall be no discrimination against or segregation of any person or group of persons contrary to the terms of applicable law on account of race, color, creed, religion, sex, marital status,
physical or mental disability or medical condition, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the Premises herein leased nor shall
Lessee establish or permit any such practice or practices or discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees,
subtenants or vendors in the Premises herein leased. Lessee shall incorporate the terms of this paragraph in each lease, sublease, assignment or occupancy agreement executed by Lessee for all or a
portion of the Premises." 

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

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

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

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

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

34

 

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

	Executed at:  Monrovia, California	 	Executed at:  _______________________________
	on:  Nov 7, 2000	 	on:  ______________________________________
	

By LESSOR:	
 	

By LESSEE:
	S&F HUNTINGTON MILLENNIUM LLC	 	SEEBEYOND TECHNOLOGIES CORP., INC.
	

___________________________________________	 	

___________________________________________
	

By:  /s/ Blaine P. Fetter	
 	

By:    /s/ Barry J. Plaga
	Name Printed:  Blaine P. Fetter	 	Name Printed:  ____________________________
	Title:  Manager	 	Title:  _________________________________
	

By:  ___________________________________________	
 	

By:  
	Name Printed:  ____________________________	 	Name Printed:  ____________________________
	Title:  _________________________________	 	Title:  _________________________________
	

Address:  602 East Huntington Drive, Ste. D

Monrovia, California 91016

___________________________________________	
 	

Address:  _______________________________

___________________________________________

___________________________________________
	

626 305-5530 / 626 305-5541

Telephone / Facsimile	
 	

___________________________________________

Telephone / Facsimile
	

Federal ID No.____________________________	
 	

Federal ID No.____________________________
	
LESSOR'S

BROKER:	
 	
LESSEE'S

BROKER:
	

___________________________________________	 	CRESA PARTNERS LLC
	

Attn:  ____________________________________	
 	

Attn:  Doug Econ and Gerry Porter
	

Address:  _______________________________

___________________________________________

___________________________________________	
 	

Address:  11726 San Vicente Blvd., Ste. 500

Los Angeles, California 90049

___________________________________________
	

___________________________________________	 	310 207-1700 / 310 207-0930
	Telephone / Facsimile No.	 	Telephone / Facsimile No.

These forms are often modified to meet changing requirements of law and needs of the industry. Always write or call to make sure you are utilizing the most current form:
American Industrial Real Estate Association, 700 South Flower Street, Suite 600, Los Angeles, CA 90017.

(213) 687-8777.  

 ©Copyright 1999-By American Industrial Real Estate Association.

All rights reserved.

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

35

 
  
 

    [AIR LOGO]    
  

 
  RENT ADJUSTMENTS
  STANDARD LEASE ADDENDUM    
  

	 	 	Dated	 	   October 9, 2000

	 	 	By and Between (Lessor)	 	   S&F HUNTINGTON MILLENNIUM LLC

	      	 	 	 	

	 	 	(Lessee)	 	   SEEBEYOND TECHNOLOGIES CORP., INC.

	

      	
 	

 	
 	

	 	 	Address of Premises:	 	   181 West Huntington Drive, Ste. 210

	 	 	 	 	   Monrovia, California 91016

Paragraph  54  

A.  RENT ADJUSTMENTS:  

    The monthly rent for each month of the adjustment period(s) specified below shall be increased using the method(s) indicated below: 

(Check
Method(s) to be Used and Fill in Appropriately) 

    / /  I.  Cost of Living Adjustment(s)
(COLA)  

     a. On
(Fill in COLA Dates):                                     the
Base Rent shall be adjusted by the change, if any, from the Base Month specified below,
in the Consumer Price Index of the Bureau of Labor Statistics of the U.S. Department of Labor for (select one): / / CPI W (Urban Wage Earners and Clerical Workers) or
/ / CPI U
(All Urban Consumers), for (Fill in Urban Area):                                 
   . All Items (1082-1904 = 100), herein referred to as "CPI". 

     b. The
monthly rent payable in accordance with paragraph A.I.a of this Addendum shall be calculated as follows: the Base Rent set forth in paragraph 1.5 of the attached
Lease, shall be multiplied by a fraction the numerator of which shall be the CPI of the calendar month two months prior to the month(s) specified in paragraph A.I.a. above during which the adjustment
is to take effect, and the denominator of which shall be the CPI of the calendar month which is two months prior to (select one): / / the first month of the term of
this Lease as set forth in paragraph 1.3 ("Base Month") or / / (Fill in Other "Base Month"):             . The sum so calculated
shall constitute the new monthly rent hereunder, but in no event, shall any such new monthly rent be less than the rent payable for the month immediately preceding the rent adjustment. 

     c. In
the event the compilation and/or publication of the CPI shall be transferred to any other governmental department or bureau or agency or shall be discontinued,
then the index most nearly the same as the CPI shall be used to make such calculation. In the event that the Parties cannot agree on such alternative index, then the matter shall be submitted for
decision to the American Arbitration Association in accordance with the then rules of said Association and the decision of the arbitrators shall be binding upon the parties. The cost of said
Arbitration shall be paid equally by the Parties. 

    / /  II.  Market Rental Value Adjustment(s)
(MRV)  

1

 

     a. On
(Fill in MRV Adjustment Date(s):                                   
  the Base Rent shall be adjusted to the "Market Rental Value" of the property as
follows: 

    1)  Four
months prior to each Market Rental Value Adjustment Date described above, the Parties shall attempt to agree upon what the new MRV will be on the adjustment
date. If agreement cannot be reached within thirty days, then: 

    (a) Lessor
and Lessee shall immediately appoint a mutually acceptable appraiser or broker to establish the new MRV within the next thirty days. Any associated costs
will be split equally between the Parties, or 

    (b) Both
Lessor and Lessee shall each immediately make a reasonable determination of the MRV and submit such determination, in writing, to arbitration in accordance
with the following provisions: 

     (i) Within
fifteen days thereafter, Lessor and Lessee shall each select an / / appraiser or / / broker
("Consultant"—check one) of their choice to act as an arbitrator. The two arbitrators so appointed shall immediately select a third mutually
acceptable Consultant to act as a third arbitrator. 

    (ii) The
Three arbitrators shall within thirty days of the appointment of the third arbitrator reach a decision as to what the actual MRV for the Premises is, and
whether Lessor's or Lessee's submitted MRV is the closest thereto. The decision of a majority of the arbitrators shall be binding on the Parties. The submitted MRV which is determined to be the
closest to the actual MRV shall thereafter be used by the Parties. 

    (iii) If
either of the Parties fails to appoint an arbitrator within the specified fifteen days, the arbitrator (timely appointed by one of them) shall reach a decision
on his or her own, and such decision shall be binding upon the Parties. 

    (iv) The
entire cost of such arbitration shall be paid by the party whose submitted MRV is not selected, i.e. the one that is NOT the closest to the actual MRV. 

    2)  Notwithstanding
the foregoing, the new MRV shall not be less than the rent payable for the month immediately preceding the rent adjustment. 

     b. Upon
the establishment of each New Market Rental Value: 

    1)  the
new MRV will become the new "Base Rent" for the purpose of calculating any further Adjustments, and 

    2)  the
first month of each Market Rental Value term shall become the new "Base Month" for the purpose of calculating any further adjustment. 

/x/  III.  Fixed Rental Adjustment(s) (FRA)  

The
Base Rent shall be increased to the following amounts on the dates set forth below: 

	On (Fill in FRA Adjustment Date(s)):	 	The New Base Rent shall be:
	

   February 1, 2003
	
 	

$2.07/square foot FSG*

	   Feb. 1, 2005
	 	$2.19/square foot FSG*

	            
	 	$            

	            
	 	$            

2

 

*$.16/square
foot is allocated to the cost of submetered electrical service 

B.  NOTICE:  

    Unless specified otherwise herein, notice of any such adjustments, other than Fixed Rental Adjustments, shall be made as specified in paragraph 23 of the
Lease. 

C.  BROKER'S FEE:  

    The Brokers specified in paragraph 1.10 shall be paid a Brokerage Fee for each adjustment specified above in accordance with paragraph 15 of the Lease. 

3

 
 
 

RULES AND REGULATIONS FOR
  STANDARD OFFICE LEASE    
  

    
[AIR LOGO] 

Dated:  October
9, 2000

By
and Between  S&F HUNTINGTON MILLENNIUM LLC (Lessor) and SEEBEYOND TECHNOLOGIES CORP., INC. (Lessee) 

 
 

GENERAL RULES    
  

    1.  Lessee
shall not suffer or permit the obstruction of any Common Areas, including driveways, walkways and stairways. 

    2.  Lessor
reserves the right to refuse access to any persons Lessor in good faith judges to be a threat to the safety and reputation of the Project and its occupants. 

    3.  Lessee
shall not make or permit any noise or odors that annoy or interfere with other lessees or persons having business within the Project. 

    4.  Lessee
shall not keep animals or birds within the Project, and shall not bring bicycles, motorcycles or other vehicles into areas not designated as authorized for
same. 

    5.  Lessee
shall not make, suffer or permit litter except in appropriate receptacles for that purpose. 

    6.  Lessee
shall not alter any lock or install new or additional locks or bolts. 

    7.  Lessee
shall be responsible for the inappropriate use of any toilet rooms, plumbing or other utilities. No foreign substances of any kind are to be inserted
therein. 

    8.  Lessee
shall not deface the walls, partitions or other surfaces of the Premises or Project. 

    9.  Lessee
shall not suffer or permit anything in or around the Premises or Building that causes excessive vibration or floor loading in any part of the Project. 

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

    11. Lessee
shall not employ any service or contractor for services or work to be performed in the Building, except as approved by Lessor. 

    12. Lessor
reserves the right to close and lock the Building on Saturdays, Sundays and Building Holidays, and on other days between the hours of
6:30 P.M. and 7:30 A.M. of the following day. If Lessee uses the Premises during such periods, Lessee shall be responsible for securely
locking any doors it may have opened for entry. (Lessee shall have 24/7 access to building) 

    13. Lessee
shall return all keys at the termination of its tenancy and shall be responsible for the cost of replacing any keys that are lost. 

    14. No
window coverings, shades or awnings shall be installed or used by Lessee. 

    15. No
Lessee, employee or invitee shall go upon the roof of the Building. 

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

1

 

    17. Lessee shall not use any method of heating or air conditioning other than as provided by Lessor. 

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

    19. The
Premises shall not be used for lodging or manufacturing, cooking or food preparation. 

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

    21. Lessor
reserves the right to waive any one of these rules or regulations, and/or as to any particular Lessee, and any such waiver shall not constitute a waiver of
any other rule or regulation or any subsequent application thereof to such Lessee. 

    22. Lessee
assumes all risks from theft or vandalism and agrees to keep its Premises locked as may be required. 

    23. Lessor
reserves the right to make such other reasonable rules and regulations as it may from time to time deem necessary for the appropriate operation and safety of
the Project and its occupants. Lessee agrees to abide by these and such rules and regulations. 

 
 

PARKING RULES    
  

    1.  Parking
areas shall be used only for parking by vehicles no longer than full size, passenger automobiles herein called "Permitted Size Vehicles." Vehicles other
than Permitted Size Vehicles are herein referred to as "Oversized Vehicles." 

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

    3.  Parking
stickers or identification devices shall be the property of Lessor and be returned by Lessor by the holder thereof upon termination of the holder's parking
privileges. Lessee will pay such replacement charge as is reasonably established by Lessor for the loss of such devices. 

    4.  Lessor
reserves the right to refuse the sale of monthly identification devices to any person or entity that willfully refuses to comply with the applicable rules,
regulations, laws and/or agreements. 

    5.  Lessor
reserves the right to relocate all or a part of parking spaces from floor to floor, within one floor, and/or to reasonably adjacent offsite location(s), and
to reasonably allocate them between compact and standard size spaces, as long as the same complies with applicable laws, ordinances and regulations. 

    6.  Users
of the parking area will obey all posted signs and park only in the areas designated for vehicle parking. 

    7.  Unless
otherwise instructed, every person using the parking area is required to park and lock his own vehicle. Lessor will not be responsible for any damage in
vehicles, injury to persons or loss of property, all of which risks are assumed by the party using the parking area. 

    8.  Validation,
if established, will be permissible only by such method or methods as Lessor and/or its licensee may establish at rates generally applicable to visitor
parking. 

    9.  The
maintenance, washing, waxing or cleaning of vehicles in the parking structure or Common Areas is prohibited. 

    10. Lessee
shall be responsible for seeing that all of its employees, agents and invitees comply with the applicable parking rules, regulations, laws and agreements. 

2

 

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

    12. Such
parking use as is herein provided is intended merely as a license only and no bailment is intended or shall be created hereby. 

3

 
 
 

STANDARD OFFICE LEASE
  FLOOR PLAN    
  

    
[AIR LOGO] 

[GRAPHIC
- [ILLEGIBLE] ] 

[GRAPHIC
- SECOND FLOOR PLAN] 

4

 

DAILY:  

	•
	Dust
all exposed areas on desks, cabinets, shelves, etc...

	•
	Dump
trash and replace liners as needed.

	•
	Complete
restroom sanitation including: cleaning all fixtures, dumping trash, restocking paper supplies, polishing metal and mirrors, & wet mopping floors.

	•
	Vacuuming
all exposed carpeted areas.

	•
	Sweeping
& spot mopping all tile areas.

	•
	Cleaning
all drinking faucets.

	•
	Spot
clean front door glass. 

MONTHLY:  

	•
	Detail
dust all items over 7 feet & below 2 feet.

	•
	Dust
all ceiling vents.

	•
	Dust
all mini blinds. 

5

QuickLinks

EXHIBIT 10.18

STANDARD MULTI-TENANT OFFICE LEASE—GROSS AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION

[AIR LOGO]

RENT ADJUSTMENTS STANDARD LEASE ADDENDUM

RULES AND REGULATIONS FOR STANDARD OFFICE LEASE

GENERAL RULES

PARKING RULES

STANDARD OFFICE LEASE FLOOR PLANPrepared by MERRILL CORPORATION www.edgaradvantage.com

QuickLinks
 -- Click here to rapidly navigate through this document

 
 

EXHIBIT 10.19    
  

 
 

EMPLOYMENT AGREEMENT    
  

    THIS EMPLOYMENT AGREEMENT, dated as of the 1st day of August, 1998, by and between Software Technologies Corporation, a California corporation (the "Company"),
and Rangaswamy Srihari, the undersigned executive (the "Executive"). 

Recital

    The
Company desires to retain the services of Executive, and Executive desires to be employed by the Company, on the terms and subject to the conditions set forth in this Agreement; 

    NOW,
THEREFORE, in consideration of the foregoing recital and the respective undertakings of the Company and Executive set forth below, the Company and Executive agree as follows: 

    1.  Employment.  

    (a) Duties. The Company agrees to employ the Executive as Vice President, and the Executive agrees to perform such
reasonable responsibilities and duties as may be required of him by the Company provided, however, that the Board of Directors of the Company (the "Board") shall have the right to revise such
responsibilities from time to time as the Board may deem appropriate. The Executive shall carry out his duties and responsibilities hereunder in a diligent and competent manner and shall devote his
full business time, attention and energy thereto. Executive shall report directly to the Chairman and Chief Executive Officer of the Company and shall be primarily responsible for all research and
development activities. 

    (b) Employment At-Will. The Company and the Executive acknowledge and agree that the Executive's employment
is at-will, as defined under applicable law and may be terminated at any time, with or without Cause. If the Executive's employment terminates for any reason, the Executive shall not be
entitled to any payments, benefits, damages, awards or compensation other than as provided in Section 3 of this Agreement. 

    2.  Compensation and Benefits.  

    (a) Base Compensation. The Company shall pay the Executive as compensation for his services a base salary of $170,000.
Such salary shall be subject to applicable tax withholding and shall be paid periodically in accordance with normal Company payroll practices. The compensation specified in this Section 2,
together with any increases in such compensation that the Company may, in its sole discretion, grant from time to time, is referred to in this Agreement as "Base Compensation." 

    (b) Executive Benefits. Executive shall be eligible to participate in the employee benefit plans which are available or
which become available, with the adoption or maintenance of such plans to be in the discretion of the Company, to other executives of the Company of a comparable level, subject in each case to the
generally applicable terms and conditions of the plan or program in question and to the determination of any committee administering such plan or program. 

    (c) Automobile. Executive shall receive a car allowance up to a maximum of $800 per month to lease a car of the
Executive's choice. 

    3.  Severance Payments.  

    (a) Payments upon Termination. If the Executive's employment terminates as a result of an Involuntary Termination other
than for Cause and the Executive signs a Release of Claims, then the Company shall pay Executive's Base Compensation to the Executive for a period of twelve (12) months, or through
December 31, 1999, whichever provides the longest period of salary continuation. Such amount shall be payable in monthly installments on the last day of each month. In addition, should such
termination occur within the twelve (12) month period immediately 

following the effective date of this agreement, relocation costs up to $30,000 will be paid to the Executive within 30 days of his termination date. 

    (b) Benefits. In the event the Executive is entitled to severance benefits pursuant to Section 3(a), then in
addition to such severance benefits, the Executive shall receive employee benefits coverage as provided to Executive immediately prior to the Executive's termination (the "Company-Paid
Coverage"). If such coverage included the Executive's dependents immediately prior to the Executive's termination, such dependents shall also be covered to the extent covered prior to Executive's
termination. Company-Paid Coverage shall continue until the earlier of (i) twelve (12) months following the notice date for the Involuntary Termination, or (ii) the
date the Executive becomes covered under another employer's group health, dental or life insurance plan (to the extent covered under such plans). To the extent
permissible under the Company's insurance policies, the Executive's rights under the Consolidated Omnibus Budget Reconciliation Act of 1985 shall begin at the end of such twelve (12) month
period. 

    (c) Stock Options: Commission. Executive shall not be entitled to receive any unvested stock options. 

    (d) Miscellaneous. In addition, (i) the Company shall pay the Executive any unpaid base salary due for periods
prior to the date of Executive's termination; (ii) the Company shall pay the Executive all of the Executive's accrued and unused vacation through the date of Executive's termination; and
(iii) following submission of proper expense reports by the Executive, the Company shall reimburse the Executive for all expenses reasonably and necessarily incurred by the Executive in
connection with the business of the Company prior to termination. These payments shall be made promptly upon termination and within the period of time mandated by applicable law. 

    (e) Voluntary Resignation: Termination for Cause. If the Executive's employment terminates by reason of Executive's
voluntary resignation or if the Executive is terminated for Cause, the Executive shall not be entitled to receive severance payments or other benefits under this Section. 

    (f)  Death or Disability. If the Executive's employment terminates as a result of his death or disability, neither the
Executive or, in the case of death, Executive's beneficiary or estate, shall be entitled to any compensation, severance payments, or any other benefits under this Section except as required by law. 

    4.  Confidential Information.  

    (a) Company Information. Executive agrees at all times during the term of Executive's employment and thereafter, to hold
in strictest confidence, and not to use, except for the benefit of the Company, or to disclose to any person, firm or corporation without written authorization of the Board of Directors of the
Company, any Confidential Information of the Company. Executive understands that "Confidential Information" means any Company proprietary information, trade secrets or know-how, including,
but not limited to, market research, product plans, products, services, customer lists and customers (including, but not limited to, customers of the Company to whom Executive becomes acquainted
during the term of Executive's employment), markets, developments, marketing, finances or other business information disclosed to Executive by the Company either directly or indirectly in writing,
orally or by drawings or observation of parts or equipment. Executive further understands that Confidential Information does not include any of the foregoing items which has become publicly known and
made generally available through no wrongful act of Executive or of others who were under confidentiality obligations as to the item or items involved. 

    (b) Third Party Information. Executive recognizes that the Company has received and in the future will receive from
third parties their confidential or proprietary information subject to a duty on the Company's part to maintain the confidentiality of such information and to use it only for certain
limited purposes. Executive agrees to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation or to use it 

except as necessary in carrying out Executive's work for the Company consistent with the Company's agreement with such third party. 

    5.  Definitions. As used herein, the terms  

    (a) Cause. "Cause" means the Executive's termination only upon: (i) Executive has engaged in willful and material
misconduct, including willful and material failure to perform his duties as an officer or employee of the Company or a material breach of this Agreement and has failed to "cure" such default within
thirty (30) days after receipt of written notice of default from the Company; (ii) the commission of an act of fraud or embezzlement which results in loss, damage or injury to the
Company, whether directly or indirectly; (iii) Executive's use of narcotics, liquor or illicit drugs has had a detrimental effect on the performance of his employment responsibilities, as
determined by the Company's Board of Directors; (iv) Executive's violation of Sections 4 or 5 of this Agreement; (v) the arrest, indictment or filing of charges relating to a felony,
either in connection with the performance of the Executive's obligations to the Company or which shall adversely affect the Executive's ability to perform such obligations; (vi) gross
negligence, dishonesty, breach of fiduciary duty or material breach of the terms of the Agreement or any other agreement in favor of the Company; or (vii) the commission of an act which
constitutes unfair competition with the Company or which induces any customer of the Company to break a contract with the Company. 

    (b) Change of Control. "Change of Control" shall mean the occurrence of any of the following events; provided, however,
that an initial public offering or any transaction for the purpose of providing capital financing to the Company shall not constitute a Change of Control: 

    (i)  The
acquisition by any "person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) (other than the Company or a person that directly or
indirectly controls, is controlled by, or is under common control with, the Company) of the "beneficial ownership" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company's then outstanding voting securities; 

    (ii) A
merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least fifty percent
(50%) of the total voting power represented by the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; 

    (iii) The
approval by the stockholders of the Company of a plan of complete liquidation of the Company; 

    (iv) An
agreement for the sale or disposition by the Company of all or substantially all the Company's assets. 

    (c) Involuntary Termination. "Involuntary Termination" shall mean: (i) termination by the Company of Executive's
employment with the Company for any reason other than Cause; (ii) a five percent (5%) or greater reduction in Executive's Base Compensation (not including bonus), other than any such reduction
which is part of, and generally consistent with, a general reduction of officer salaries; (iii) a material reduction by the Company in the kind or level of employee benefits (other than salary
and bonus) to which Executive is entitled immediately prior to such reduction with the result that Executive's overall benefits package (other than salary and bonus) is substantially reduced (other
than any such reduction applicable to officers of the Company generally); (iv) any material breach by the Company of any material provision of this Agreement which continues uncured for
30 days following notice thereof; provided that none of the foregoing shall constitute Involuntary Termination to the extent Executive has agreed thereto. 

    (d) Release of Claims. "Release of Claims" shall mean a waiver by Executive, in a form satisfactory to the Company, of
all employment related obligations of and claims and causes of actions against the Company. 

    6.  Change of Control.  In the event of a Change of Control, fifty percent (50%) of the unvested portion
of any outstanding stock option(s) granted under the Company's stock option plan(s) (the "Options") shall vest and become exercisable. Executive shall have the right to exercise such additional vested
portion of the Options in addition to any portion of the Options which was vested and exercisable prior to the application of this Section. 

    7.  Prior Agreements.  Executive represents that Executive has not entered into any agreements,
understandings, or arrangements with any person or entity which would be breached by Executive as a result of, or that would in any way preclude or prohibit Executive from entering into this Agreement
with the Company or performing any of the duties and responsibilities provided for in this Agreement. 

    8.  Conflicting Employment.  Executive agrees that, during the term of Executive's employment with the
Company, Executive will not engage in any other employment, occupation, consulting or other business activity directly related to the business in which the Company is now involved or becomes involved
during the term of Executive's employment, nor will Executive engage in any other activities that conflict with Executive's obligations to the Company. 

    9.  Returning Company Documents.  Executive agrees that, at the time of leaving the employ of the
Company, Executive will deliver to the Company (and will not keep in Executive's possession, recreate or deliver to anyone else) any and all devices, records, data, notes, reports, proposals, lists,
correspondence, specifications, materials, equipment, other documents or property, or reproductions of any aforementioned items developed by Executive pursuant to Executive's employment with the
Company or otherwise belonging to the Company, its successors or assigns. 

    10.  Notices.  Any notice, report or other communication required or permitted to be given hereunder
shall be in writing to both parties and shall be deemed given on the date of delivery, if delivered, or three days after mailing, if mailed first-class mail, postage prepaid, to the following
addresses: 

If
to the Executive, at the address set forth below the Executive's signature at the end hereof. 

If
to the Company: 

Software
Technologies Corp.

404 East Huntington Drive

Monrovia, California 91016

Attn: Chief Executive Officer 

or
to such other address as any party hereto may designate by notice given as herein provided. 

    11.  Governing Law.  This Employment Agreement shall be governed by and construed and enforced in
accordance with the internal substantive laws, and not the choice of law rules of California. 

    12.  Amendments.  This Employment Agreement shall not be changed or modified in whole or in part except
by an instrument in writing signed by each party hereto. 

    13.  Severability.  The invalidity or unenforceability of any provision or provisions of this Agreement
shall not affect the validity or enforceability of any other provision hereof, which shall remain in full force and effect. 

    14.  Successors.  

    (a) Company's Successors. Any successor to the Company (whether direct or indirect and whether by purchase, lease,
merger, consolidation, liquidation or otherwise) to all or substantially all of the Company's business and/or assets shall assume the obligations under this Agreement and agree expressly to perform
the obligations under this Agreement in the same manner 

    (b) and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes under this Agreement, the term
"Company" shall include any successor to the Company's business and/or assets which executes and delivers the assumption agreement described in this subsection (a) or which becomes bound by the
terms of this Agreement by operation of law. 

    (c) Executive's Successors. The terms of this Agreement and all rights of the Executive hereunder shall inure to the
benefit of, and be enforceable by, the Executive's personal or legal representatives, executors, administrators, successor, heirs, distributees, devisees or legatees. 

    15.  Entire Agreement.  Except with respect to specific provisions of any prior written agreement between
the Executive and the Company relating to the Executive's agreement not to compete with the Company or solicit the Company's employees, this Agreement shall supersede and replace all prior agreements
or understandings relating to the subject matter hereof, and no agreement, representations or understandings (whether oral or written or whether express or implied) which are not expressly set forth
in this Agreement have been made or entered into by either party with respect to the relevant matter hereof 

    16.  Mediation.  Executive agrees that any dispute or controversy arising out of, relating to, or in
connection with this Agreement, or the interpretation, validity, construction, performance, breach or termination thereof, shall first be submitted to mediation. The mediation shall be conducted
within 45 days of Executive notifying the Company of a dispute or controversy regarding this Agreement or Executive's employment relationship with the Company. Unless otherwise provided for by
law, the Company and Executive shall each pay half the costs and expenses of the mediation. 

    17.  Arbitration and Equitable Relief.  

    (a) In
the event that mediation pursuant to Section 16 fails to resolve a dispute or controversy, and except as provided in Section 17(d) below, the
Company and Executive agree that any dispute or controversy arising out of, relating to, or in connection with this Agreement, or the interpretation, validity, construction, performance, breach, or
termination thereof shall be settled by arbitration to be held in Los Angeles County, California, in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the
American Arbitration Association (the "Rules"). The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator shall be final, conclusive and
binding on the parties to the arbitration. Judgment may be entered on the arbitrator's decision in any court having jurisdiction. 

    (b) The
arbitrator[s] shall apply California law to the merits of any dispute or claim, without reference to rules of conflict of law. Executive
hereby expressly consents to the personal jurisdiction of the state and federal courts located in California for any action or proceeding arising from or relating to this Agreement or relating to any
arbitration in which the parties are participants. 

    (c) The
Company and Executive shall each pay one-half of the costs and expenses of such arbitration, and shall separately pay its counsel fees and expenses
unless, otherwise required by law or determined by the arbitrator. 

    (d) The
parties may apply to any court of competent jurisdiction for a temporary restraining order, preliminary injunction, or other interim or conservatory relief, as
necessary, without breach of this arbitration agreement and without abridgment of the powers of the arbitrator. 

    (e) Executive
understands that nothing in this Section modifies Executive's at-will status. Either the Company or Executive can terminate the employment
relationship at any time, with or without cause. 

    (f)  EXECUTIVE
HAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EXECUTIVE AGREES, EXCEPT AS
PROVIDED IN SUBSECTION (d) OF THIS SECTION, TO SUBMIT ANY FUTURE CLAIMS ARISING OUT OF, RELATING TO, 

OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH, OR TERMINATION THEREOF TO BINDING ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A
WAIVER OF EXECUTIVE'S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, THE FOLLOWING
CLAIMS: 

    (i)  ANY
AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT; BREACH OF CONTRACT, BOTH EXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD FAITH AND FAIR DEALING, BOTH
EXPRESS AND IMPLIED; NEGLIGENT OR INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS; NEGLIGENT OR INTENTIONAL MISREPRESENTATION; NEGLIGENT OR INTENTIONAL INTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC
ADVANTAGE; AND DEFAMATION. 

    (ii) ANY
AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL STATE OR MUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED TO, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE CIVIL
RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE FAIR LABOR STANDARDS ACT, THE CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, AND
LABOR CODE SECTION 201, et seq;

    (iii) ANY
AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION. 

    18.  Counterparts.  This Employment Agreement may be executed in several counterparts,  
each of which shall be an original, but all of which together shall constitute one and the same agreement. 

    19.  Effect of Headings.  The section headings herein are for convenience only and shall not affect the
construction or interpretation of this Agreement. 

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

	 	 	SOFTWARE TECHNOLOGIES CORPORATION
	

 	
 	

By:	
 	

	

 	
 	

 	
 	

EXECUTIVE
	

 	
 	

 	
 	

/s/ James T. Demetriades
 (Signature)
	

 	
 	

 	
 	

/s/ Rangaswamy Srihari
 Rangaswamy Srihari
	

 	
 	

 	
 	

	

 	
 	

 	
 	

 (Print Address)
	

 	
 	

 	
 	

 (Print Telephone Number)

 
 

[SIGNATURE PAGE OF RANGASWAMY SRIHARI EMPLOYMENT AGREEMENT]    
  

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EXHIBIT 10.19

EMPLOYMENT AGREEMENT

[SIGNATURE PAGE OF RANGASWAMY SRIHARI EMPLOYMENT AGREEMENT]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00022-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00022-of-00352.parquet"}]]