Document:

2000 10K Exbibit 10.6

EXHIBIT 10.06

AMENDED AND RESTATED

LOAN AND SECURITY AGREEMENT

 

THIS AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
(this "Agreement") is made and entered into effective as of
January 1, 2001 (the "Effective Date") by and among ONSALE, Inc.,
a Delaware corporation ("Lender"), and Jeff Sheahan and Theresa
Sheahan (together, "Borrower"). This Agreement and the Note
(defined in Section 1.2) and any other documents entered into pursuant to this
Agreement or in connection with the Loan (defined in Section 1.1) are
hereinafter sometimes collectively referred to as the "Loan
Documents."

WHEREAS, Lender and Borrower are parties to that
certain Loan and Security Agreement dated as of November 23, 1998 (the
"Prior Agreement"), that certain Secured Promissory Note dated
November 23, 1998 in the aggregate principal amount of $250,000.00 (the
"Prior Note"), and that certain Stock Pledge Agreement dated as of
November 23, 1998 (the "Stock Pledge Agreement"); and

WHEREAS, Lender and Borrower desire (i) to amend and
restate the Prior Agreement and the Prior Note and (ii) to terminate the Second
Deed of Trust (as defined below) and the Stock Pledge Agreement as set forth in
this Agreement.

NOW, THEREFORE, in consideration of the foregoing
recitals and for other consideration, the adequacy and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:

1.AMOUNT AND TERMS OF LOAN.

1.1Loan. On November 23, 1998, Lender loaned
Borrower the principal amount of Two Hundred Fifty Thousand Dollars
($250,000.00) (the "Loan") for the purchase of the property
located at APN 215-260-004, commonly known as 127 Alta Vista Way, Danville,
California 94506 (the "Property").

1.2Note. Borrower's indebtedness to
Lender with respect to the Loan is evidenced by the Prior Note. Lender and
Borrower agree to amend and restate the Prior Note and, subject to the terms and
conditions of this Agreement and from and after the Effective Date, the Loan
will be evidenced by a Full Recourse Promissory Note executed by Borrower
substantially in the form attached as Exhibit A (the
"Note").

1.3Security. Borrower's indebtedness to
Lender under the Loan Documents will not be secured by a second deed of trust
(the "Second Deed of Trust") on the Property and will not be
secured by Borrower's pledge of certain equity securities of Lender pursuant to
the terms and conditions of the Stock Pledge Agreement. Each of Lender and
Borrower agree that the Second Deed of Trust and the Stock Pledge Agreement
shall be terminated as of the Effective Date. 

1.4Maturity of Loan. Subject to Section 1.5
below, the outstanding principal and accrued interest due under the Loan,
together with any other related fees, expenses or costs, will be immediately due
and payable in full to Lender on the date (the "Maturity Date")
that is the earlier to occur of (i) November 23, 2003 and (ii) the date on which
the outstanding principal and accrued interest of the Loan becomes due and
payable in full under Section 2 below.

1.5Loan Forgiveness. The outstanding
principal and accrued interest due under the Loan will be forgiven as follows:
(i) one-third of the outstanding principal and accrued interest due as of
January 1, 2001 will be forgiven by Lender on such date; (ii) one-half of the
outstanding principal and accrued interest due as of January 1, 2002 will be
forgiven by Lender on such date, provided that Mr. Sheahan has been continuously
employed by Lender from January 2, 2001 to January 1, 2002; and (iii) all
outstanding principal and accrued interest remaining due as of January 1, 2003
will be forgiven by Lender on such date, provided that Mr. Sheahan has been
continuously employed by Lender from January 2, 2002 to January 1, 2003;
provided, however, that if Lender terminates Mr. Sheahan's
employment without cause, or constructively discharges Mr. Sheahan without
cause, Lender will forgive the remaining balance of outstanding principal and
accrued interest due under the Loan and will provide Mr. Sheahan with a cash
payment to cover the federal and state income tax due with respect to the
forgiveness of the Loan but Mr. Sheahan shall be liable and responsible for any
taxes due with respect to such cash payment by Lender.

1.6At Will Employment. Borrower is an "at
will" employee of Lender, and nothing in this Agreement or any exhibit shall be
construed as a promise of continued employment.

2.DEFAULT BY BORROWER. 

2.1Default. Borrower will be deemed to be
in default under the Loan upon the occurrence of any of the following events
(each an "Event of Default"): (i) Borrower's failure to make any
payment when due under the Loan, which failure shall continue for a
period of five (5) days after such due date; (ii) the termination of Mr.
Sheahan's employment with Lender; (iii) the failure of any representation
or warranty in the Loan Documents to have been true, the failure of Borrower to
perform any obligation under the Loan Documents, or upon any other material
breach by Borrower of the Loan Documents; (iv) the filing regarding Borrower of
any voluntary or involuntary petition for relief under the United States
Bankruptcy Code or the initiation of any proceeding under federal law or law of
any other jurisdiction for the general relief of debtors; or (v) the execution
by Borrower of an assignment for the benefit of creditors or the appointment of
a receiver, custodian, trustee or similar party to take possession of Borrower's
assets or property.

2.2Acceleration; Remedies Upon Default.
Upon the occurrence of any Event of Default, at the option of Lender, all
outstanding principal, accrued interest and other amounts due under the Loan
shall become immediately due and payable without notice or demand on the part of
Lender, and Lender will have, in addition to its rights and remedies under the
Loan Documents, full recourse against any real, personal, tangible or intangible
assets of Borrower, and may pursue any legal or equitable remedies that are
available to it; provided, however, that upon the termination of
Mr. Sheahan's employment with Lender for cause or for Mr. Sheahan's negligence,
the outstanding principal, accrued interest and other amounts due under the Loan
will become due and payable in full to Lender on the six (6) month anniversary
of the date of such termination by Lender, and Borrower must use fifty percent
(50%) of all proceeds from any sale by Borrower of the equity securities of
Lender, which Borrower acquires pursuant to Borrower's exercise of options to
purchase equity securities of Lender under Lender's 1995 Equity Incentive Plan
or any subsequent or similar stock option plan of Lender, or any employee stock
purchase agreement or other similar plan of Lender (collectively, the
"Shares"), to pay such amounts due under the Loan. The rights and
remedies of Lender herein provided will be cumulative and not exclusive of any
other rights or remedies provided by law or otherwise; and provided,
however, that if Mr. Sheahan terminates his employment with Lender
voluntarily, the outstanding principal, accrued interest and other amounts due
under the Loan will become due and payable in full to Lender on the second
anniversary of the date that Mr. Sheahan voluntarily terminates his employment.

3.MISCELLANEOUS.

3.1Entire Agreement. The Loan Documents
constitute the entire agreement and understanding among the parties with respect
to the subject matter thereof and supersedes any prior understandings or
agreements of the parties with respect to such subject matter.

3.2Successors and Assigns. The
terms and conditions of this Agreement will inure to the benefit of and be
binding upon the respective successors and assigns of the parties, including any
subsequent holders of the Note; provided, however, that Borrower
may not assign or delegate any of its rights or obligations hereunder or under
any other Loan Document or any interest herein or therein without Lender's prior
written consent.

3.3Modification; Waiver. This Agreement may
be modified or amended only by a writing signed by both parties hereto. No delay
or failure on the part of either party in exercising any right or remedy under
this Agreement or any other Loan Document will operate as a waiver of such right
or any other right. A waiver given on one occasion will not be construed as a
bar to, or as a waiver of, any right or remedy on any future occasion.

3.4Severability. The invalidity or
unenforceability of any term or provision of this Agreement will not affect the
validity or enforceability of any other term or provision.

3.5Governing Law. This Agreement
will be governed by and construed in accordance with the internal laws of the
State of California, as applied to agreements entered into solely between
residents of and to be performed entirely in the State of California, without
reference to that body of law relating to conflicts of law or choice of law.

3.6Arbitration. Any dispute arising
from or relating to this Agreement will be submitted to mandatory, final and
binding arbitration in Santa Clara County, California, and, except as herein
specifically stated, in accordance with the provisions of the Streamlined
Arbitration Rules and Procedures of J.A.M.S./ENDISPUTE or its successor
("J.A.M.S.") then in effect. However, in all events, these
arbitration provisions will govern over any conflicting rules that may now or
hereafter be contained in the Streamlined Arbitration Rules and Procedures of
J.A.M.S. The parties covenant that they will participate in the arbitration in
good faith. Any judgment upon the award rendered by the arbitrator may be
entered in any court having jurisdiction over the subject matter thereof. The
arbitrator will have the authority to grant any equitable and legal remedies
that would be available in any judicial proceeding instituted to resolve any
dispute arising from or relating to this Agreement.

3.7Counterparts. This Agreement may be
executed in one or two counterparts, each of which will be deemed an original,
but together will constitute one and the same instrument.

3.8Further Assurances. Each of
Borrower and Lender will execute and deliver such instruments, documents or
other writings as Borrower or Lender, as the case may be, may reasonably require
in order to confirm and carry out and to effectuate fully the intent and the
purposes of this Agreement or any of the other Loan Documents.

3.9Prior Agreement and Prior Note
Superseded. The undersigned parties who are parties to the Prior
Agreement and the Prior Note hereby amend and restate the Prior Agreement and
the Prior Note to read in its entirety as set forth in this Agreement and the
Note, all with the intent and effect that the Prior Agreement and the Prior Note
shall hereby be cancelled and entirely replaced and superseded by this Agreement
and the Note.

IN WITNESS WHEREOF, the parties have duly executed
and delivered this Agreement as of the Effective Date.

BORROWER:LENDER:

ONSALE, INC.

 

/s/ Jeff Sheahan/s/ John F.
Labbett

Jeff SheahanJohn Labbett
Executive Vice President and

Chief Financial Officer

/s/ Theresa Sheahan

Theresa Sheahan

Attachment:

Exhibit A - Full Recourse Promissory Note

 

Full Recourse Promissory Note

Palo Alto, California

 

$250,000.00November 23, 1998

This Full Recourse Promissory Note (this
"Note") is issued under, and entitled to the benefits of, that
certain Amended and Restated Loan and Security Agreement (the
"Agreement") dated as of January 1, 2001, by and among the
undersigned ("Borrower") and ONSALE, Inc., a Delaware corporation
(the "Company"), and entirely replaces and supersedes that certain
Secured Promissory Note dated November 23, 1998 in the aggregate principal
amount of $250,000.00 in the favor of the Company (the "Prior
Note"), which was cancelled pursuant to the Agreement. Unless otherwise
indicated in this Note, all capitalized terms used herein have the meanings
assigned to them in the Agreement.

1.Obligation. For value received, Borrower
hereby promises to pay, subject to the terms and conditions of Section 1.5 of
the Agreement, to the order of the Company on or before November 23, 2003, at
the Company's principal place of business located at 1350 Willow Road, #202,
Menlo Park, California 94025, or at such other place as the Company may direct,
the principal sum of Two Hundred Fifty Thousand Dollars ($250,000.00) together
with interest compounded semi-annually on the unpaid principal at the rate of
four and forty-six hundredths percent (4.46%), which rate is the minimum rate
established pursuant to Section 1274(d) of the Internal Revenue Code of 1986, as
amended, at the time the Prior Note was issued by Borrower; provided,
however, that the rate at which interest will accrue on unpaid principal
under this Note will not exceed the highest rate permitted by applicable law.
Interest will continue to accrue until the date on which all amounts owing under
this Note have been repaid in full. All payments hereunder shall be made in
lawful tender of the United States.

2.Default. Borrower will be deemed to be in
default under this Note upon the occurrence of any of the following events (each
an "Event of Default"): (i) Borrower's failure to make any payment
when due under this Note, which failure shall continue for a period of five (5)
days after such due date; (ii) the termination of Mr. Sheahan's employment with
the Company; (iii) the failure of any representation or warranty in the
Loan Documents to have been true, the failure of Borrower to perform any
obligation under the Loan Documents, or upon any other material breach by
Borrower of the Loan Documents; (iv) the filing regarding Borrower of any
voluntary or involuntary petition for relief under the United States Bankruptcy
Code or the initiation of any proceeding under federal law or law of any other
jurisdiction for the general relief of debtors; or (v) the execution by Borrower
of an assignment for the benefit of creditors or the appointment of a receiver,
custodian, trustee or similar party to take possession of Borrower's assets or
property.

3.Acceleration; Remedies On Default.
Upon the occurrence of any Event of Default, at the option of the Company,
all outstanding principal, accrued interest and other amounts due under this
Note shall become immediately due and payable without notice or demand on the
part of the Company, and the Company will have, in addition to its rights and
remedies under the Loan Documents, full recourse against any real, personal,
tangible or intangible assets of Borrower, and may pursue any legal or equitable
remedies that are available to it; provided, however, that upon
the termination of Mr. Sheahan's employment with the Company for cause or for
Mr. Sheahan's negligence, all outstanding principal, accrued interest and other
amounts due under this Note shall become due and payable in full to Lender on
the six (6) month anniversary of the date of such termination by the Company,
and Borrower must use fifty percent (50%) of all proceeds from any sale by
Borrower of the Shares to pay such amounts due under this Note. The rights and
remedies of Lender herein provided will be cumulative and not exclusive of any
other rights or remedies provided by law or otherwise; and provided,
however, that if Mr. Sheahan terminates his employment with the Company
voluntarily, the outstanding principal, accrued interest and other amounts due
under this Note will become due and payable in full to the Company on the second
anniversary of the date that Mr. Sheahan voluntarily terminates his
employment.

4.Prepayment. Borrower may prepay the
outstanding principal and accrued interest due under the Loan at any time,
without penalty, in whole or in part in amounts of at least Ten Thousand Dollars
($10,000.00). Unless otherwise agreed in writing by the Company, each payment
will be applied to the extent of available funds from such payment in the
following order:  (i) first to the accrued and unpaid costs and
expenses under the Loan Documents, (ii) then to accrued but unpaid
interest, and (iii) lastly to the outstanding principal.

5.Assignment. This Note is freely
transferable and assignable by the Company and each subsequent holder, provided
that such transfer is made in compliance with all applicable state and federal
securities laws. Any reference to the Company herein will be deemed to refer to
any subsequent transferee of this Note at such time as such transferee holds
this Note. Borrower may not assign or delegate this Note, whether by voluntary
assignment or transfer, operation of law or otherwise.

6.Governing Law; Waiver. The
validity, construction and performance of this Note will be governed by the
internal laws of the State of California, excluding that body of law pertaining
to conflicts of law. Borrower hereby waives presentment, notice of non-payment,
notice of dishonor, protest, demand and diligence.

7.Attorneys' Fees. If suit is brought
for collection of this Note, Borrower agrees to pay all reasonable expenses,
including attorneys' fees, incurred by the holder in connection therewith
whether or not such suit is prosecuted to judgment.

IN WITNESS WHEREOF, Borrower has executed this Note as
of the date and year first above written.

 
BORROWER:

/s/ Jeff Sheahan
Jeff Sheahan

/s/ Theresa Sheahan
Theresa Sheahan

 

Accepted and Acknowledged:

THE COMPANY

ONSALE, INC.
/s/ John Labbett

John Labbett

Executive Vice President and 

Chief Financial Officer2000 10K Exbibit 10.10

EXHIBIT 10.10

STANDARD INDUSTRIAL LEASE - MULTI-TENANT

AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION

	Parties.  This Lease, dated, for reference purposes only, August 24,
2000, is made by and between The Columbian Publishing, Co., a Washington
corporation, (herein called "Lessor") and Egghead.com, Inc., a Delaware
corporation (herein called "Lessee").

	Premises, Parking and Common Areas.

	Premises.  Lessor hereby leases to Lessee and Lessee leases from Lessor
for the term, at the rental, and upon all of the conditions set forth herein,
real property situated in the County of Clark, State of Washington, commonly
known as 206 Grand Boulevard, Vancouver, Washington 98661 and described as
approximately 72,086 square feet building herein referred to as the "Premises,"
as may be outlined on an Exhibit attached hereto, including rights to the Common
Areas as hereinafter specified but not including any rights to the roof of the
Premises or to any Building in the Industrial Center. The Premises are a portion
of a building herein referred to as the "Building." The Premises, the Building,
the Common Areas, the land upon which the same are located, along with all other
buildings and improvements thereon, are herein collectively referred to as the
"Industrial Center." Attached hereto as Exhibit A-1 is the legal description for
the Premises. Attached hereto as Exhibit A-2 is the "Site Plan" for the parking
referenced in paragraph 2.2 below. Attached, hereto as Exhibit A-3 is the
description of the "Industrial Center".

	Vehicle Parking.  Lessee shall be entitled to three hundred (300)
vehicle parking spaces, unreserved and unassigned, on those portions of the
Common Areas designated by Lessor for parking. The site plan for specific
parking areas shall be approved by Lessor and Lessee and shall be attached to
this Lease. Lessee shall not use more parking spaces than said number. Said
parking spaces shall be used only for parking by vehicles no larger than full-
size passenger automobiles or pickup trucks, herein called "Permitted Size
Vehicles." Vehicles other than Permitted Size Vehicles are herein referred to as
"Oversized Vehicles."

	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 parking in areas other than those designated
by Lessor and approved by Lessee for such activities.
	If Lessee permits or allows any of the prohibited activities described in
paragraph 2.2 of this Lease, 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.

	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 Industrial Center that are provided and designated by the Lessor from
time to time for the general non-exclusive use of Lessor, Lessee, and other
lessees of the Industrial Center and their respective employees, suppliers,
shippers, customers and invitees, including parking areas, loading and unloading
areas, trash areas, roadways, sidewalks, walkways, parkways, driveways and
landscaped areas.

	Common Areas - Lessee's Rights.  Lessor hereby grants to Lessee, for
the benefit of Lessee and its employees, suppliers, shippers, customers and
invitees, during the term of this Lease, the non-exclusive right to use, in
common with others entitled to such use, the Common Areas as they exist from
time to time, subject to any rights, powers, and privileges reserved by Lessor
under the terms hereof or under the terms of any rules and regulations or
restrictions governing the use of the Industrial Center. 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.
Notwithstanding the foregoing, Lessor and Lessee approve the use of the area
noted on the site plan as "Staging Area" for purpose of loading and unloading
and staging and delivery of products by Lessee. 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.

	Common Areas - Rules and Regulations.  Lessor or such other person(s)
as Lessor may appoint shall have the exclusive control and management of the
Common Areas and shall have the right, from time to time; to establish, modify,
amend, and enforce reasonable rules and regulations with respect thereto. Lessee
agrees to abide by and conform to all such rules and regulations, and to cause
its employees, suppliers, shippers, customers, and invitees to so abide and
conform. Lessor shall not be responsible to Lessee for the noncompliance with
said rules and regulations by other lessees of the Industrial Center. All rules
and regulations shall be enforced in a non-discriminating manner to all Lessees,
their employees, customers and invitees.

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

(a)To make changes to the Common Areas, including, without limitation,
changes in the location, size, shape and number of driveways, entrances, parking
spaces, parking areas, loading and unloading areas, ingress, egress, direction
of traffic, landscaped areas and walkways. (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 Industrial Center to be a part of the Common Areas. (d) To add additional
buildings and improvements to the Common Areas. (e) To use the Common Areas
while engaged in making additional improvements, repairs or alterations to the
Industrial Center, or any portion thereof. (f) To do and perform such other acts
and make such other changes in, to, or with respect to the Common Areas and
Industrial Center as Lessor may, in the exercise of sound business judgment,
deem to be appropriate (g) No change to the Common Area shall materially and
adversely affect the Lessee's ability to conduct its business or use of the
Premises.

	Lessor shall at all times provide the parking facilities required by
applicable law and in no event shall the number of parking spaces that Lessee is
entitled to under paragraph 2.2 be reduced.

	Term.

	Term.  The term of this lease shall be for 36 months commencing on
November 15, 2000 and ending on November 15, 2003 unless sooner terminated
pursuant to any provision hereof.

	Delay in Possession.  Notwithstanding said commencement date, if for
any reason Lessor cannot deliver possession of the Premises to Lessee on said
date, Lessor shall not be subject to any liability therefore, nor shall such
failure affect the validity of this Lease or the obligations of Lessee hereunder
or extend the term hereof, but in such case, Lessee shall not be obligated to
pay rent or perform any other obligation of Lessee under the terms of this
Lease, except as may be otherwise provided in this Lease, until possession of
the Premises is tendered to Lessee, provided, however, that if Lessor shall not
have delivered possession of the Premises within forty-five (45) days from said
commencement date, Lessee may, at Lessee's option, by notice in writing to
Lessor within ten (10) days thereafter, cancel this Lease, in which event the
parties shall be discharged from all obligations hereunder, provided further,
however, that if such written notice of Lessee is not received by Lessor within
said ten (10) day period, Lessee's right to cancel this Lease hereunder shall
terminate and be of no further force or effect.

	Early Possession.  If Lessee occupies the Premises prior to said
commencement date, such occupancy shall be subject to all provisions of this
Lease, such occupancy shall not advance the termination date, and Lessee shall
pay rent for such period at the initial monthly rates set forth below except
that Lessee shall be allowed possession of the Premises rent free for a period
of thirty (30) days prior to Lease Commencement to fixturize the Premises to its
needs.

	Rent.

	Base Rent.  Lessee shall pay to Lessor, as Base Rent for the Premises,
without any offset or deduction, except as may be otherwise expressly provided
in this Lease, on the first day of each month of the term hereof, monthly
payments in advance of in the amounts referenced in Paragraph 52. Lessee shall
pay Lessor upon execution hereof the sum of $42,935.00 for first month's Base
Rent, first month's operating expenses and security deposit, as set forth in
paragraph 52(b). Rent for any period during the term hereof which is for less
than one month shall be a pro rata portion of the Base Rent. Rent shall be
payable in lawful money of the United States to Lessor at the address stated
herein or to such other persons or at such other places as Lessor may designate
in writing.  
	Operating Expenses. Lessee shall pay to Lessor during the term hereof, in
addition to the Base Rent, Lessee's Share, as hereinafter defined, of all
Operating Expenses, as hereinafter defined, during each calendar year of the
term of this Lease, in accordance with the following provisions:

	"Lessee's Share" is defined, for purposes of this Lease, 39.30 percent.
	"Operating Expenses" is defined, for purposes of this Lease, as all costs
incurred                                   by Lessor, if any, for:

	The operation, repair, and maintenance, in neat, clean, good order and
condition, of the following provisions:

	The Common Areas, including parking areas, loading and unloading areas,
trash areas, roadways, sidewalks, walkways, parkways, driveways, landscaped
areas, striping, bumpers, irrigation systems, Common Area lighting facilities
and fences and gates.
	Management fee not to exceed 15% of operating expenses incurred.
	Tenant directories.
	Fire detection systems including sprinkler system maintenance and
repair.
	Security services.
	Any other service to be provided by Lessor that is elsewhere in this Lease
stated to be an "Operating Expense."

	Any deductible portion of an insured loss concerning any of the items or
matters described in this paragraph 4.2.
	The cost of the premiums for the liability and property insurance policies
to be maintained by Lessor under paragraph 8 hereof.
	The amount of the real property tax to be paid by Lessor under paragraph
10.1 hereof.
	Maintenance of the boiler that serves the Premises, including the cost of
employing a 24-hour facility maintenance person. Lessee shall employ, at
Lessee's expense, the 24-hour facility maintenance person to oversee the
operation and maintenance of the boiler.
	The cost of water, gas and electricity to service the Common
Areas.
	The inclusion of the improvements, facilities and services set forth in
paragraph 4.2(b)(i) of the definition of Operating Expenses shall not be deemed
to impose an obligation upon Lessor to either have said improvements or
facilities or to provide those services unless the Industrial Center 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.
	Lessee's Share of Operating Expenses shall be payable by Lessee within ten
(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 of Lessee's Share of annual Operating Expenses and the
same shall be payable monthly or quarterly, as Lessor shall designate, during
each 12-month period 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 Expenses as aforesaid, Lessor shall deliver to Lessee within 60 days
after the expiration of each calendar year a reasonably detailed statement
showing Lessee's Share of the actual Operating Expenses incurred during the
preceding year. If Lessee's payments under this paragraph 4.2(d) during said
preceding 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 Expenses next falling due. If Lessee's payments under this
paragraph during said preceding year were less than Lessee's Share as indicated
on said statement, Lessee shall pay to Lessor the amount of the deficiency
within ten (10) days after delivery by Lessor to Lessee of said
statement.

	Security Deposit.  Lessee shall deposit with Lessor upon execution
hereof Nineteen Thousand Eight Hundred Sixty-seven and No/100 ($19,867.00) as
security for Lessee's faithful performance of Lessee's obligations hereunder. If
Lessee fails to pay rent or other charges due hereunder, or otherwise defaults
with respect to any provision of this Lease, Lessor may use, apply, or retain
all or any portion of said deposit for the payment of any rent or other charge
in default or for the payment of any other sum to which Lessor may become
obligated by reason of Lessee's default, or to compensate Lessor for any loss or
damage which Lessor may suffer thereby. If Lessor so uses or applies all or any
portion of said deposit, Lessee shall within ten (10) days after written demand
therefor deposit cash with Lessor in an amount sufficient to restore said
deposit to the full amount then required of Lessee. If the monthly rent shall,
from time to time, increase during the term of this Lease, Lessee shall, at the
time of such increase, deposit with Lessor additional money as a security
deposit so that the total amount of the security deposit held by Lessor shall at
all times bear the same proportion to the then current Base Rent as the initial
security deposit bears to the initial Base Rent set forth in paragraph 4. Lessor
shall not be required to keep said security deposit separate from its general
accounts. If Lessee performs all of Lessee's obligations hereunder, said
deposit, or so much thereof as has not theretofore been applied by Lessor, shall
be returned, without payment of interest or other increment for its use, to
Lessee (or, at Lessor's option, to the last assignee, if any, of Lessee's
interest hereunder) at the expiration of the term hereof, and after Lessee has
vacated the Premises. No trust relationship is created herein between Lessor and
Lessee with respect to said Security Deposit.

	Use.

	Use.  The Premises shall be used and occupied only for data processing
services administration services, office functions, storage and distribution of
product or any other use which is reasonably comparable and for no other
purpose.

	Compliance with Law.

	Lessor warrants to Lessee that the Premises, in the state existing on
the date that the Lease term commences, but without regard to the use for which
Lessee will occupy the Premises, does not violate any covenants or restrictions
of record, or any applicable building code, regulation or ordinance excluding
Americans Disabilities Act (ADA requirements in effect on such Lease term
commencement date. In the event it is determined that this warranty has been
violated, then it shall be the obligation of the Lessor, after written notice
from Lessee, to promptly, at Lessor's sole cost and expense, rectify any such
violation. In the event Lessee does not give to Lessor written notice of the
violation of this warranty within six (6) months from the date that the Lease
term commences, the correction of same shall be the obligation of the Lessee at
Lessee's sole cost. The warranty contained in this paragraph 6.2(a) shall be of
no force or effect if, prior to the date of this Lease, Lessee was an owner or
occupant of the Premises and, in such event, Lessee shall correct any such
violation at Lessee's sole cost.
	Except as provided in paragraph 6.2(a) Lessee shall, at Lessee's expense,
promptly comply with all applicable statutes, ordinances, rules, regulations,
orders, covenants and restrictions of record, and requirements of any fire
insurance underwriters or rating bureaus, now in effect or which may hereafter
come into effect, whether or not they reflect a change in policy from the now
existing, during the term or any part of the term hereof, relating in any manner
to the Premises and the occupation and use by Lessee of the Premises and of the
Common Areas. Lessee shall not use nor permit the use of the Premises or the
Common Areas in any manner that will tend to create waste or a nuisance or shall
tend to disturb other occupants of the Industrial Center.

	Condition of Premises.

	Lessor shall deliver the Premises to Lessee clean and free of debris on
the Lease commencement date (unless Lessee is already in possession) and Lessor
warrants to Lessee that the plumbing, lighting, heating, and loading doors in
the Premises shall be in good operating condition on the Lease commencement
date. In the event that it is determined that this warranty has been violated,
then it shall be the obligation of Lessor, after receipt of written notice from
Lessee setting forth with specificity the nature of the violation, to promptly,
at Lessor's sole cost, rectify such violation. Lessee's failure to give such
written notice to Lessor within 30 days after the Lease commencement date shall
cause the conclusive presumption that Lessor has complied with all of Lessor's
obligations hereunder. The warranty contained in this paragraph 6.3(a) shall be
of no force or effect if prior to the date of this Lease, Lessee was an owner or
occupant of the Premises.
	Except as otherwise provided in this Lease, Lessee hereby accepts the
Premises in their condition existing as of the Lease commencement date or the
date that Lessee takes possession of the Premises, whichever is earlier, subject
to all applicable zoning, municipal, county and state laws, ordinances and
regulations governing and regulating the use of the Premises, and any covenants
or restrictions of record, and accepts this Lease subject thereto and to all
matters disclosed thereby and by any exhibits attached hereto. Lessee
acknowledges that neither Lessor nor Lessor's agent has made any representation
or warranty as to the present or future suitability of the Premises for the
conduct of Lessee's business. Lessor agrees to cooperate with Lessee, at
Lessee's expense, in the processing of all required governmental permits,
including any necessary conditional use permits but excluding any zone changes,
for the Premises.

	Maintenance, Repairs, Alterations and Common Area Services.

	Lessor's Obligations.  Subject to the provisions of paragraphs 4.2
(Operating Expenses), 6 (Use), 7.2 (Lessee's Obligations) and 9 (Damage or
Destruction), and except for damage caused by any negligent or intentional act
or omission of Lessee, Lessee's employees, suppliers, shippers, customers, or
invitees, in which event Lessee shall repair the damage, Lessor, at Lessor's
expense, subject to reimbursement pursuant to paragraph 4.2, shall keep in good
condition and repair the foundations, exterior walls, structural condition of
interior bearing walls, and roof of the Premises, as well as the parking lots,
walkways, driveways, landscaping, fences, signs and utility installations of the
Common Areas and all parts thereof, as well as providing the services for which
there is an Operating Expense pursuant to paragraph 4.2. Lessor shall not,
however, be obligated to paint the exterior or interior surface of exterior
walls, nor shall Lessor be required to maintain, repair or replace windows,
doors or plate glass of the Premises. Lessor shall have no obligation to make
repairs under this paragraph 7.1 until a reasonable time after receipt of
written notice from the Lessee of the need for such repairs. Lessee expressly
waives the benefits of any statute now or hereafter in effect which would
otherwise afford Lessee the right to make repairs at Lessor's expense or to
terminate this Lease because of Lessor's failure to keep the Premises in good
order, condition and repair. Lessor shall not be liable for damages or loss of
any kind or nature by reason of Lessor's failure to furnish any Common Area
Services when such failure is caused by accident, breakage, repairs, strikes,
lockout, or other labor disturbances or disputes of any character, or by any
other cause beyond the reasonable control of Lessor.

	Lessee's Obligations.

	Subject to the provisions of paragraphs 6 (Use), 7.1 (Lessor's
Obligations), and 9 (Damage or Destruction), Lessee, at Lessee's expense, shall
keep in good order, condition and repair the Premises and every part thereof
(whether or not the damaged portion of the Premises or the means of repairing
the same are reasonably or readily accessible to Lessee) including, without
limiting the generality of the foregoing, all plumbing, heating, electrical and
lighting facilities and equipment within the Premises, fixtures, interior walls
and interior surfaces of exterior walls, ceilings, windows, doors, plate glass,
and skylights located within the Premises. Lessor reserves the right to procure
and maintain the ventilating and air condition system maintenance contract and
if Lessor so elects, Lessee shall reimburse Lessor, upon demand, for the cost
thereof.
	If Lessee fails to perform Lessee's obligations under this paragraph 7.2 or
under any other paragraph of this Lease, Lessor may enter upon the Premises
after ten (10) days prior written notice to Lessee (except in the case of
emergency, in which no notice shall be required), perform such obligations on
Lessee's behalf and put the Premises in good order, condition and repair, and
the cost thereof together with interest thereon at the maximum rate then
allowable by law shall be due and payable as additional rent to Lessor together
with Lessee's next Base Rent installment.
	On the last day of the term hereof, or on any sooner termination, Lessee
shall surrender the Premises to Lessor in the same condition as received,
ordinary wear and tear excepted, clean and free of debris. Any damage or
deterioration of the Premises shall not be deemed ordinary wear and tear if the
same could have been prevented by good maintenance practices. Lessee shall
repair any damage to the Premises occasioned by the installation or removal of
Lessee's trade fixtures, alterations, furnishings and equipment. Notwithstanding
anything to the contrary otherwise stated in this Lease, Lessee shall leave the
air lines, power panels, electrical distribution systems, lighting fixtures,
space heaters, air conditioning, plumbing and fencing on the Premises in good
operating condition.

	Alterations and Additions.

	Lessee shall not, without Lessor's prior written consent make any
alterations, improvements, additions, or Utility Installations in, on, or about
the Premises, or the Industrial Center, except for nonstructural alterations to
tile Premises not exceeding $300,000 in cumulative costs, during the term of
this Lease. In any event, whether or not in excess of $300,000 in cumulative
cost, Lessee shall make no change or alteration to the exterior of the Premises
nor the exterior of the Building nor the Industrial Center without Lessor's
prior written consent. As used in this paragraph 7.3 the term "Utility
Installation" shall mean carpeting, window coverings, air lines, power panels,
electrical distribution systems, lighting fixtures, space heaters, air
conditioning, plumbing, and fencing. Lessor may require that Lessee remove any
or all of said alterations, improvements, additions or Utility Installations at
the expiration of the term, and restore the Premises and the Industrial Center
to their prior condition. Lessor may , require Lessee to provide Lessor, at
Lessee's sole cost and expense, a lien and completion bond in an amount equal to
one and one-half times the estimated cost of such improvements, to insure Lessor
against any liability for mechanic's and materialmen's liens and to insure
completion of the work. Should Lessee make any alterations, improvements,
additions or Utility Installations without the prior approval of Lessor, Lessor
may, at any time during the term of this Lease, require that Lessee remove any
or all of the same.
	Any alterations, improvements, additions or Utility Installations in or
about the Premises or the Industrial Center that Lessee shall desire to make and
which requires the consent of the Lessor shall be presented to, Lessor in
written form, with proposed detailed plans. If Lessor shall give its consent,
the consent shall be deemed conditioned upon Lessee acquiring a permit to do so
from appropriate governmental agencies, the furnishing of a copy thereof to
Lessor prior to the commencement of the work and the compliance by Lessee of all
conditions of said permit in a prompt and expeditious manner.
	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 in the Premises,
which claims are or may be secured by any mechanic's or materialmen's lien
against the Premises, or the Industrial Center, or any interest therein. Lessee
shall give Lessor not less than 10 days' notice prior to the commencement of any
work in the Premises, and Lessor shall have the right to post notices of
nonresponsibility in or on the Premises or the Building as provided by law. If
Lessee shall, in good faith, contest the validity of any such lien, claim or
demand, then Lessee shall, at its sole expense defend itself and Lessor against
the same and shall pay and satisfy and such adverse judgment that may be
rendered thereon before the enforcement thereof against the Lessor or the
Premises or the Industrial Center, upon the condition that if Lessor shall
require, Lessee shall furnish to Lessor a surety bond satisfactory to Lessor in
an amount equal to such contested lien claim or demand indemnifying Lessor
against liability for the same and holding the Premises and the Industrial
Center free from the effect of such lien or claim. In addition, Lessor may
require Lessee to pay Lessor's attorneys fees and costs in participating in such
action if Lessor shall decide it is to Lessor's best interest to do so.
	All alterations, improvements, additions and Utility Installations, which
may be made on the Premises, shall be the property of Lessor and shall remain
upon and be surrendered with the Premises at the expiration of the Lease term,
unless Lessor requires their removal pursuant to paragraph 7.3(a).
Notwithstanding the provisions of this paragraph 7.3(d), Lessee's machinery and
equipment, other than that which is affixed to the Premises so that it cannot be
removed without material damage to the Premises, and other than Utility
Installations, shall remain the property of Lessee and may be removed by Lessee
subject to the provisions of paragraph 7.2.

	Utility Additions.  Lessor reserves the right to install new or
additional utility facilities throughout the Building and the Common Areas for
the benefit of Lessor or Lessee, or any other lessee of the Industrial Center,
including, but not by way of limitation, such utilities as plumbing, electrical
systems, security systems, communication systems, and fire protection and
detection systems, so long as such installations do not unreasonably interfere
with Lessee's use of the Premises.

	Insurance; Indemnity.

	Liability Insurance - Lessee.  Lessee shall, at Lessee's expense, obtain
and keep in force during the term of this Lease a policy of Combined Single
Limit Bodily Injury and Property Damage insurance insuring Lessee and Lessor
against any liability arising out of the use, occupancy or maintenance of the
Premises and the Industrial Center. Such insurance shall be in an amount not
less than $2,000,000.00 per occurrence. The policy shall insure performance by
Lessee of the indemnity provisions of this paragraph 8. The limits of said
insurance shall not, however, limit the liability of Lessee hereunder.

	Liability Insurance - Lessor.  Lessor shall obtain and keep in force
during the term of this Lease a policy of Combined Single Limit Bodily Injury
and Property Damage Insurance, insuring Lessor, but not Lessee, against any
liability arising out of the ownership, use, occupancy or maintenance of the
Industrial Center in an amount not less than $2,000,000.00 per occurrence.

	Property Insurance.  Lessor shall obtain and keep in force during the
term of this Lease a policy or policies of insurance covering loss or damage to
the Industrial Center improvements, but not Lessee's personal property,
fixtures, equipment or tenant improvements, in an amount not to exceed the full
replacement value thereof, as the same may exist from time to time, providing
protection against all perils included within the classification of fire,
extended coverage, vandalism, malicious mischief, flood (in the event same is
required by a lender having a lien on the Premises) special extended perils
("all risk," as such term is used in the insurance industry), plate glass
insurance and such other insurance as Lessor deems advisable. In addition,
Lessor shall obtain and keep in force, during the term of this Lease, a policy
of rental value insurance covering a period of one year, with loss payable to
Lessor, which insurance shall also cover all Operating Expenses for said period.
In the event that the Premises shall suffer an insured loss as defined in
paragraph 9.1(g) hereof, the deductible amounts under the casualty insurance
policies relating to the Premises shall be paid by Lessee. Notwithstanding the
foregoing, the deductible amount shall not exceed in the aggregate the sum of
Five Thousand Dollars and 00/100 ($5,000.00) with Lessee being responsible for
its proportionate share.

	Payment of Premium Increase.

	After the term of this Lease has commenced, Lessee shall not be
responsible for paying Lessee's Share of any increase in the property insurance
premium for the Industrial Center specified by Lessor's insurance carrier as
being caused by the use, acts or omissions of any other lessee of the Industrial
Center, or by the nature of such other lessee's occupancy which create an
extraordinary or unusual risk.
	Lessee, however, shall pay the entirety of any increase in the property
insurance premium for the Industrial Center over what it was immediately prior
to the commencement of the term of this Lease if the increase is specified by
Lessor's insurance carrier as being caused by the nature of Lessee's occupancy
or any act or omission of Lessee.

	Insurance Policies.  Insurance required hereunder shall be in
companies holding a "General Policyholders Rating" of at lease B plus, or such
other rating as may be required by a lender having a lien on the Premises, as
set forth in the most current issue of "Best's Insurance Guide." Lessee shall
not do or permit to be done anything which shall invalidate the insurance
policies carried by Lessor. Lessee shall deliver to Lessor copies of liability
insurance policies required under paragraph 8.1 or certificates evidencing the
existence and amounts of such insurance within seven (7) days after the
commencement date of this Lease. No such policy shall be cancelable or subject
to reduction of coverage or other modification except after 30 days prior
written notice to Lessor. Lessee shall, at least 30 days prior to the expiration
of such policies, furnish Lessor with renewals or "binders" thereof.

	Waiver of Subrogation.  Lessee and Lessor each hereby release and
relieve the other and waive their entire right of recovery against the other for
loss or damage arising out of or incident to the perils insured against which
perils occur in, on or about the Premises, whether due to the negligence of
Lessor or Lessee or their agents, employees, contractors and/or invitees. Lessee
and Lessor shall, upon obtaining the policies of insurance required give notice
to the insurance carrier or carriers that the foregoing mutual waiver of
subrogation is contained in this Lease.

	Indemnity.  Lessee shall indemnify and hold harmless Lessor from and
against any and all claims arising from Lessee's use of the Industrial Center,
or from the conduct of Lessee's business or from any activity, work or things
done, permitted or suffered by Lessee in or about the Premises or elsewhere and
shall further indemnify and hold harmless Lessor from and against any and all
claims arising from any breach or default in the performance of any obligation
on Lessee's part to be performed under the terms of this Lease, or arising from
any act or omission of Lessee, or any of Lessee's agents, contractors, or
employees, .and from and against all costs, attorney's fees, expenses and
liabilities incurred in the defense of any such claim or any action or
proceeding brought thereon; and in case any action or proceeding be brought
against Lessor by reason of any such claim, Lessee upon notice from Lessor,
shall defend the same at Lessee's expense by counsel reasonably satisfactory to
Lessor and Lessor shall cooperate with Lessee in such defense. Lessee, as a
material part of the consideration to Lessor, hereby assumes all risk of damage
to property of Lessee or injury to persons, in, upon or about the Industrial
Center arising from any cause and Lessee hereby waives, all claims in respect
thereof against Lessor.

Lessor shall indemnify and hold harmless Lessee from and
against any and all claims arising from Lessor's use of the Industrial Center,
or from the conduct of Lessor's business or from any activity, work or things
done, permitted or suffered by Lessor in or about the Premises or elsewhere and
shall further indemnify and hold harmless Lessee from and against any and all
claims arising from any breach or default in the performance of any obligation
on Lessor's part to be performed under the terms of this Leas , or arising from
any act or omission of Lessor, or any of Lessor's agents, contractors, or
employees, and from and against all costs, attorney's fees, expenses and
liabilities incurred in the defense of any such claim or any action or
proceeding brought thereon; and in case any action or proceeding be brought
against Lessee by reason of any such claim, Lessor upon notice from Lessee,
shall defend the same at Lessor's expense by counsel reasonably satisfactory to
Lessee and Lessee shall cooperate with Lessor in such defense.

	Exemption of Lessor from Liability.  Subject to paragraph 8.7 above,
Lessee hereby agrees that Lessor shall not be liable for injury to Lessee's
business or any loss of income therefrom or for damage to the goods, wares,
merchandise, or other property of Lessee. Lessee's employees, invitees,
customers, or any other person in or about the Premises or the Industrial
Center, nor shall Lessor be liable for injury to the person of Lessee, Lessee's
employees, agents or contractors, 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, sprinklers, wires, appliances,
plumbing, air conditioning or lighting fixtures, or from any other cause,
whether said damage or injury results from conditions arising upon the Premises
or upon other portions of the Industrial Center, or from other sources or places
and regardless of whether the cause of such damage or injury or the means of
repairing the same is inaccessible to Lessee. Lessor shall not be liable for any
damages arising from any act or neglect of any other lessee, occupant or user of
the Industrial Center, nor from the failure of Lessor to enforce the provisions
of any other lease of the Industrial Center.

	Limitation of Liability.  No personal liability or personal
responsibility is assumed by or shall at any time be asserted or enforceable
against Lessor's or Lessee's respective partners, directors, officers,
employees, agents or their legal representatives, successors or assigns on
account of this Lease or on account of any covenant, undertaking or agreement of
Lessor or Lessee contained in this Lease.

	Damage or Destruction.

	Definitions.

	"Premises Partial Damage" shall mean if the Premises are damaged or
destroyed to the extent that the cost of repair is less than fifty percent of
the then replacement cost of the Premises.
	"Premises Total Destruction" shall mean if the Premises are damaged or
destroyed to the extent that the cost of repair is fifty percent or more of the
then replacement cost of the Premises.
	"Premises Building Partial Damage" shall mean if the Building of which the,
Premises are a part is damaged or destroyed to the extent that the cost to
repair is less than fifty percent of the then replacement cost of the
Building.
	"Premises Building Total Destruction" shall mean if the Building of which
the Premises are a part is damaged or destroyed to the extent that the cost to
repair is fifty percent or more of the then replacement cost of the
Building.
	"Industrial Center Buildings" shall mean all of the buildings on the
Industrial Center site.
	"Industrial Center Buildings Total Destruction" shall mean if the Industrial
Center Buildings are damaged or destroyed to the extent that the cost of repair
is fifty percent or more of the then replacement cost of the Industrial Center
Buildings.
	"Insured Loss" shall mean damage or destruction which was caused by an event
required to be covered by the insurance described in paragraph 8. The fact that
an Insured Loss has a deductible amount shall not make the loss an uninsured
loss.
	"Replacement Cost" shall mean the amount of money necessary to be spent in
order to repair or rebuild the damaged area to the condition that existed
immediately prior to the damage occurring excluding all improvements made by
lessees.

	Premises Partial Damage; Premises Building Partial Damage.  

	Insured Loss: Subject to the provisions of paragraphs 9.4 and 9.5, if at
any time during the term of this Lease there is damage which is an Insured Loss
and which falls into the classification of either Premises Partial Damage or
Premises Building Partial Damage, then Lessor shall, at Lessor's expense, repair
such damage to the Premises, but not Lessee's fixtures, equipment or tenant
improvements, as soon as reasonably possible and this Lease shall continue in
full force and effect.
	Uninsured Loss: Subject to the provisions of paragraphs 9.4 and 9.5, if at
any time during the term of this Lease there is damage which is not an Insured
Loss and which falls within the classification of Premises Partial Damage or
Premises Building Partial Damage, unless caused by a negligent or willful act of
Lessee (in which event Lessee shall make the repairs at Lessee's expense), which
damage prevents Lessee from using the Premises, Lessor may at Lessor's option
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) give written notice to Lessee within 30 days after the date of the
occurrence of such damage of Lessor's intention to cancel and terminate this
Lease as of the date of the occurrence of such damage. In the event Lessor
elects to give such notice of Lessor's intention to cancel and terminate this
Lease, Lessee shall have the right within ten (10) days after the receipt of
such notice to give written notice to Lessor of Lessee's intention to repair
such damage at Lessee's expense, without reimbursement from Lessor, in which
event this Lease shall continue in full force and effect, and Lessee shall
proceed to make such repairs as soon as reasonably possible. If Lessee does not
give such notice within such 10-day period this Lease shall be canceled and
terminated as of the date of the occurrence of such damage.

	Premises Total Destruction; Premises Building Total Destruction;
Industrial Center Buildings Total Destruction.

	Subject to the provisions of paragraphs 9.4 and 9.5, if at any time
during the term of this Lease there is damage, whether or not it is an Insured
Loss, and which falls into the classifications of either (i) Premises Total
Destruction, or (ii) Premises Building Total Destruction, or (iii) Industrial
Center Buildings Total Destruction, then Lessor may at Lessor's option either
(i) repair such damage or destruction, but not Lessee's fixtures, equipment or
tenant improvements, as soon as reasonably possible at Lessor's expense, and
this Lease shall continue in full force and effect, or (ii) give written notice
to Lessee within 30 days after the date of occurrence of such damage of Lessor's
intention to cancel and terminate this Lease, in which case this Lease shall be
canceled and terminated as of the date of the occurrence of such damage.
Notwithstanding the foregoing, in the event of either (i) Premises Total
Destruction, or (ii) Premises Building Total Destruction, or (iii) Industrial
Center Buildings Total Destruction, Lessee may elect to cancel and terminate
this Lease by giving written notice to Lessor within thirty (30) days after the
date of occurrence of such damage of Lessee's intent to cancel and terminate
this Lease, in which case this Lease shall be cancelled and terminated as of the
date of the occurrence of such damage.

	Damage Near End of Term.

	Subject to paragraph 9.4(b), if at any time during the last six months
of the term of this Lease there is substantial damage, whether or not an Insured
Loss, which falls within the classification of Premises Partial Damage, Lessor
or Lessee may at Lessor's or Lessee's option cancel and terminate this Lease as
of the date of occurrence of such damage by giving written notice to the other
of its election to do so within 30 days after the date of occurrence of such
damage.
	Notwithstanding paragraph 9.4(a), in the event that Lessee has an option to
extend or renew this Lease, and the time within which said option may be
exercised has not yet expired, Lessee shall exercise such option, if it is to be
exercised at all, no later than 20 days after the occurrence of an Insured Loss
falling within the classification of Premises Partial Damage during the last six
months of the term of this Lease. If Lessee duly exercises such option during
said 20 day period, Lessor shall, at Lessor's expense, repair such damage, but
not Lessee's fixtures, equipment or tenant improvements, as soon as reasonably
possible and this Lease shall continue in full force and effect. If Lessee fails
to exercise such option during said 20-day period, then Lessor may at Lessor's
option terminate and cancel this Lease as of the expiration of said 20 day
period by giving written notice to Lessee of Lessor's election to do so within
ten (10) days after the expiration of said 20 day period, notwithstanding any
term or provision in the grant of option to the contrary.

	Abatement of Rent; Lessee's Remedies.

	In the event Lessor repairs or restores the Premises pursuant to the
provisions of this paragraph 9, the rent payable hereunder for the period during
which such damage, repair or restoration continues shall be abated in proportion
to the degree to which Lessee's use of the Premises is impaired. Except for
abatement of rent, if any, Lessee shall have no claim against Lessor for any
damage suffered by reason of any such damage, destruction, repair or
restoration.
	If Lessor shall be obligated to repair or restore the Premises under the
provisions of this paragraph 9 and shall not commence such repair or restoration
within 90 days after such obligation shall accrue, Lessee may at Lessee's option
cancel and terminate this Lease by giving Lessor written notice of Lessee's
election to do so at any time prior to the commencement of such repair or
restoration. In such event this Lease shall terminate as of the date of this
notice.

	Termination - Advance Payments.  Upon termination of this Lease
pursuant to this paragraph 9, an equitable adjustment shall be made concerning
advance rent and any advance payments made by Lessee to Lessor. Lessor shall, in
addition, return to Lessee so much of Lessee's security deposit as has not
theretofore been applied by Lessor.

	Waiver.  Lessor and Lessee waive the provisions of any statute which
relate to termination of leases when leased property is destroyed and agree that
such event shall be governed by the terms of this Lease.

	Real Property Taxes.

	Payment of Taxes.  Lessor shall pay the real property tax, as defined in
paragraph 10.3, applicable to the Industrial Center subject to reimbursement by
Lessee of Lessee's Share of such taxes in accordance with the provisions of
paragraph 4.2, except as otherwise provided in paragraph 10.2

	Additional Improvements.  Lessee shall not be responsible for paying
Lessee's Share of any increase in real property tax specified in the tax
assessor's records and work sheets as being caused by additional improvements
placed upon the Industrial Center by other lessees or by Lessor for the
exclusive enjoyment of such other lessees. Lessee shall, however, pay to Lessor
at the time that Operating Expenses are payable under paragraph 4.2(c) the
entirety of any increase in real property tax if assessed solely by reason of
additional improvements placed upon the Premises by Lessee or at Lessee's
request.

	Definition of "Real Property Tax.  As used herein, the term "real
property tax" shall include any form of real estate tax or assessment, general,
special, ordinary or extraordinary, and any license fee, commercial rental tax,
improvement bond or bonds, levy or tax (other than inheritance, personal income
or estate taxes) imposed on the Industrial Center or any portion thereof by any
authority having the direct or indirect power to tax, including any city,
county, state or federal government, or any school, agricultural, sanitary,
fire, street, drainage or other improvement district thereof, as against any
legal or equitable interest of Lessor in the Industrial Center or in any portion
thereof, as against Lessor's right to rent or other income therefrom, and as
against Lessor's business of leasing the Industrial Center. The term "real
property tax" shall also include any tax, fee, levy, assessment or charge (i) in
substitution of, partially or totally, any tax, fee, levy, assessment or charge
hereinabove included within the definition of "real property tax," or (ii) the
nature of which was hereinbefore included within the definition of "real
property tax," or (iii) which is imposed for a service or right not charged
prior to June 1, 1978, or, if previously charged, has been increased since June
1, 1978, or (iv) which is imposed as a result of a transfer, either partial or
total, of Lessor's interest in the Industrial Center of which is added to a tax
or charge hereinbefore included within the definition of real property tax by
reason of such transfer, or (v) which is imposed by reason of this transaction,
any modifications or changes hereto, or any transfers hereof.

	Joint Assessment.  If the Industrial Center is not separately
assessed, Lessee's Share of the real property tax liability 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.

	Personal Property Taxes.

	Lessee shall pay prior to delinquency all taxes assessed against and
levied upon trade fixtures, furnishings, equipment and all other personal
property of Lessee contained in the Premises or elsewhere. Mien possible, Lessee
shall cause said 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 personal property shall be assessed with Lessor's
real property, Lessee shall pay to Lessor the taxes attributable to Lessee
within ten (10) days after receipt of a written statement setting forth the
taxes applicable to Lessee's property.

	Utilities.  Lessee shall pay for all water, gas, heat, light, power,
telephone and other utilities and services supplied to the Premises, together
with any taxes thereon. If any such services are 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 jointly metered
with other premises in the Building.

	Assignment and Subletting.

	Lessor's Consent Required.  Lessee shall not voluntarily or by operation
of law assign, transfer, mortgage, sublet, or otherwise transfer or encumber all
or any part of Lessee's interest in the Lease or in the Premises, without
Lessor's prior written consent, which Lessor shall not unreasonably withhold.
Lessor shall respond to Lessee's request for consent hereunder in a timely
manner and any attempted assignment, transfer, mortgage, encumbrance or
subletting without such consent shall be void, and shall constitute a breach of
this Lease without the need for notice to Lessee under paragraph 13.1.

	Lessee Affiliate.  Notwithstanding the provisions of paragraph 12.1
hereof, Lessee may assign or sublet the Premises, or any portion thereof,
without Lessor's consent, to any corporation which controls, is controlled by or
is under common control with Lessee, or to any corporation resulting from the
merger or consolidation with Lessee, or to any person or entity which acquires
all the assets of Lessee as a going concern of the business that is being
conducted on the Premises, all of which are referred to as "Lessee Affiliate,"
provided that before such assignment shall be effective said assignee shall
assume, in full, the obligations of Lessee under this Lease. Any such assignment
shall not, in any way, affect or limit the liability of Lessee under the terms
of this Lease even if after such assignment or subletting the terms of this
Lease are materially changed or altered without the consent of Lessee, the
consent of whom shall not be necessary.

	Terms and Conditions of Assignment.  Regardless of Lessor's consent,
no assignment shall release Lessee of Lessee's obligations hereunder or alter
the primary liability of Lessee to pay the, Base Rent and Lessee's Share of
Operating Expenses, and to perform all other obligations to be performed by
Lessee hereunder. Lessor may accept rent from any person other than Lessee
pending approval or disapproval of such assignment. Neither a delay in the
approval or disapproval of such assignment nor the acceptance of rent shall
constitute a waiver or estoppel of Lessor's right to exercise its remedies for
the breach of any of the terms or conditions of this paragraph 12 or this Lease.
Consent to one assignment shall not be deemed consent to any subsequent
assignment. In the event of default by any assignee of Lessee or any successor
of Lessee, in the performance of any of the terms hereof, Lessor may proceed
directly against Lessee without the necessity of exhausting remedies against
said assignee. Lessor may consent to subsequent assignments of this Lease or
amendments or modifications to this Lease with assignees of Lessee, without
notifying Lessee, or any successor of Lessee, and without obtaining its or their
consent thereto and such action shall not relieve Lessee of liability under this
Lease.

	Terms and Conditions Applicable to Subletting.  Regardless of
Lessor's consent, the following terms and conditions shall apply to any
subletting by Lessee of all or any part of the Premises and shall be included in
subleases:

	Lessee hereby assigns and transfers to Lessor all of Lessee's interest in
all rentals and income arising from any sublease heretofore or hereafter made by
Lessee, and Lessor may collect such rent and income and apply same toward
Lessee's obligations under this Lease; provided, however, that until a default
shall occur in the performance of Lessee's obligations under this Lease, Lessee
may receive, collect and enjoy the rents accruing under such sublease. Lessor
shall not, by reason of this or any other assignment of such sublease to Lessor
nor by reason of the collection of the rents from a sublessee, be deemed liable
to the sublessee for any failure of Lessee to perform and comply with any of
Lessee's obligations to such sublessee under such sublease. Lessee hereby
irrevocably authorizes and dire( ; any such sublessee, upon receipt of written
notice from Lessor stating that a default exists in the performance of Lessee's
obligations under this Lease, to pay to Lessor the rents due and to become due
under the sublease. Lessee agrees that such sublessees shall have the right to
rely upon any such statement and request from Lessor, and that such sublessee
shall pay such rents to Lessor without any obligation or right to inquire as to
whether such default exists and notwithstanding any notice from or claim from
Lessee to the contrary. Lessee shall have no right or claim against such
sublessee or Lessor for any such rents so paid by said sublessee to Lessor.
	No sublease entered into by Lessee shall be effective unless and until it
has been approved in writing by Lessor. In entering into any sublease, Lessee
shall use only such form of sublease as is satisfactory to Lessor, and once
approved by Lessor, such sublease shall not be changed or modified without
Lessor's prior written consent. Any sublessee shall, by reason of entering into
a sublease under this Lease, be deemed, for the benefit of Lessor, to have
assumed and agreed to conform and comply with each and every obligation herein
to be performed by Lessee, other than such obligations as are contrary to or
inconsistent with provisions contained in a sublease to which Lessor has
expressly consented in writing.
	If Lessee's obligations under this Lease have been guaranteed by third
parties, then a sublease and Lessor's consent thereto, shall not be effective
unless said guarantors give their written consent to such sublease and the terms
thereof.
	The consent by Lessor to any subletting shall not release Lessee from its
obligations or alter the primary liability of Lessee to pay the rent and perform
and comply with all of the obligations of Lessee to be performed under this
Lease.
	The consent by Lessor to any subletting shall not constitute consent to any
subsequent subletting by Lessee or to any assignment or subletting by the
sublessee. However, Lessor may consent to subsequent sublettings and assignments
of the sublease or any amendments or modifications thereto without notifying
Lessee or anyone else liable on the Lease or sublease and without obtaining
their consent and such action shall not relieve such persons from
liability.
	In the event of any default under this Lease, Lessor may proceed directly
against Lessee, any guarantors or any one else responsible for the performance
of this Lease, including the sublessee, without first exhausting Lessor's
remedies against any other person or entity responsible therefor to Lessor, or
any security held by Lessor or Lessee.
	In the event Lessee shall default in the performance of its obligations
under this Lease, Lessor, at its option and without any obligation to do so, may
require any sublessee to attorn to Lessor, in which event Lessor shall undertake
the obligations of Lessee under such sublease from the time of the exercise of
said option to the termination of such sublease; provided, however, Lessor shall
not be liable for any prepaid rents or security deposit paid by such sublessee
to Lessee or for any other prior defaults of Lessee under such sublease.
	Each and every consent required of Lessee under a sublease shall also
require the consent of Lessor.
	No sublessee shall further assign or sublet all or any part of the Premises
without Lessor's prior written consent.
	Lessor's written consent to any subletting of the Premises by Lessee shall
not constitute an acknowledgment that no default then exists under this Lease of
the obligations to be performed by Lessee nor shall such consent be deemed a
waiver of any then existing default, except as may be otherwise stated by Lessor
at the time.
	With respect to any subletting to which Lessor has consented, Lessor agrees
to deliver a copy of any notice of default by Lessee to the sublessee. Such
sublessee shall have the right to cure a default of Lessee within 10 days after
service of said notice of default upon such sublessee, and the sublessee shall
have a right of reimbursement and offset from and against Lessee for any such
defaults cured by the sublessee.

	Attorney's Fees.  In the event Lessee shall assign or sublet the
Premises or requests the consent of Lessor to any assignment or subletting or if
Lessee shall request the consent of Lessor for any act Lessee proposes to do
then Lessee shall pay Lessor's reasonable attorneys fees incurred in connection
therewith, such attorneys fees not to exceed $350.00 for each such
request.

	Default; Remedies.

	Default.  The occurrence of any one or more of the following events
shall constitute a material default of this Lease by Lessee:

	The vacating or abandonment of the Premises by Lessee. ,
	The failure by Lessee to make any payment of rent or any other payment
required to be made by Lessee hereunder, as and when due, where such failure
shall continue for a period of three (3) days after written notice thereof from
Lessor to Lessee. In the event that Lessor serves Lessee with a Notice to Pay
Rent or Quit pursuant to applicable Unlawful Detainer statutes such Notice to
Pay Rent or Quit shall also constitute the notice required by this
subparagraph.
	Except as otherwise provided in this Lease, the failure by Lessee to observe
or perform any of the covenants, conditions, or provisions of this Lease to be
observed or performed by Lessee, other than described in paragraph (b) above,
where such failure shall continue for a period of 30 days after written notice
thereof from Lessor to Lessee; provided, however, that if the nature of Lessee's
noncompliance is such that more than 30 days are reasonably required for its
cure, then Lessee shall not be deemed to be in default if Lessee commenced such
cure within said 30-day period and thereafter diligently prosecutes such cure to
completion. To the extent permitted by law, such 30-day notice shall constitute
the sole and exclusive notice required to be given to Lessee under applicable
Unlawful Detainer statutes.
	(i) The making by Lessee of any general arrangement or general assignment
for the benefit of creditors; (ii) Lessee becomes 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. In the event that any provision of
this paragraph 13.1(d) is contrary to any applicable law, such provision shall
be of no force or effect.
	The discovery by Lessor that any financial statement given to Lessor by
Lessee, any assignee of Lessee, any subtenant of Lessee, any successor in
interest of Lessee or any guarantor of Lessee's obligation hereunder, was
materially false.

	Remedies.  In the event of any such material default by Lessee,
Lessor may at any time thereafter, with or without notice or demand and without
limiting Lessor in the exercise of any right or remedy which Lessor may have by
reason of such default:

	Terminate Lessee's right to possession of the Premises by any lawful means,
in which case this Lease and the term hereof shall terminate and Lessee shall
immediately surrender possession of the Premises to Lessor. In such event Lessor
shall be entitled to recover from Lessee all damages incurred by Lessor by
reason of Lessee's default including, but not limited to, the cost of recovering
possession of the Premises; expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorney's fees, and any
real estate commission actually paid; the worth at the time of award by the
court having jurisdiction thereof of the amount by which the unpaid rent for the
balance of the term after the time of such award exceeds the amount of such
rental loss for the same period that Lessee proves could be reasonably avoided;
that portion of the leasing commission paid by Lessor pursuant to paragraph 15
applicable to the unexpired term of this Lease.
	Maintain Lessee's right to possession in which case this Lease shall
continue in effect whether or not Lessee shall have vacated or abandoned the
Premises. In such event Lessor shall be entitled to enforce all of Lessor's
rights and remedies under this Lease, including the right to recover the rent as
it becomes due hereunder.
	Pursue any other remedy now or hereafter available to Lessor under the laws
or judicial decisions of the state wherein the Premises are located. Unpaid
installment of rent and other unpaid monetary obligations of Lessee under the
terms of this Lease shall bear interest from the date due at the maximum rate
then allowable by law.

	Default by Lessor.  Lessor shall not be in default unless Lessor
fails to perform obligations required of Lessor within a reasonable time, but in
no event later than 30 days after written notice by Lessee to Lessor and to the
holder of any first mortgage or deed of trust covering the Premises whose name
and address shall have theretofore been furnished to Lessee in writing,
specifying wherein Lessor has failed to perform such obligation; provided,
however, that if the nature of Lessor's obligation is such that more than 30
days are required for performance then Lessor shall not be in default if Lessor
commences performance within such 30 day period and thereafter diligently
prosecutes the same to completion.

	Late Charges.  Lessee hereby acknowledges that late payment by Lessee
to Lessor of Base Rent, Lessee's Share of Operating Expenses or other sums due
hereunder 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 on Lessor by the terms of any mortgage or trust
deed covering the Property. Accordingly, if any installment of Base Rent,
Operating Expenses, or any other sum due from Lessee shall not be received by
Lessor or Lessor's designee within ten (10) days after such amount shall be due,
then, without any requirement for notice to Lessee, Lessee shall pay to Lessor a
late charge equal to five percent (5%) of 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 late payment by Lessee. Acceptance of
such late charge by Lessor shall in no event constitute a waiver of Lessee's
default with respect to such overdue amount, nor prevent Lessor from exercising
any of the other rights and remedies granted hereunder. In the event that a late
charge is payable hereunder, whether or not collected, for three (3) consecutive
installments of any of the aforesaid monetary obligations of Lessee, then Base
Rent shall automatically become due and payable quarterly in advance, rather
than monthly, notwithstanding paragraph 4.1 or any other provision of this Lease
to the contrary.

	Condemnation.  If the Premises or any portion thereof or the
Industrial Center are taken under the power of eminent domain, or sold under the
threat of the exercise of said power (all of which are herein called
"condemnation"), this Lease shall terminate as to the part so taken as of the
date the condemning authority takes title or possession, whichever first occurs.
If more than 10% of the floor area of the Premises, or more than 25% of that
portion of the Common Areas designated as parking for the Industrial Center is
taken by condemnation, Lessee may, at Lessee's option, to be exercised in,
writing only within ten (10) days after Lessor shall have given Lessee written
notice of such taking (or in the absence of such notice, within ten (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 rent shall be reduced in the proportion that the floor area of
the Premises taken bears to the total floor area of the Premises. No reduction
of rent shall occur if the only area taken is that which does not have the
Premises located thereon. Any award for the taking of all or any part of the
Premises under the power of eminent domain or any payment made under threat of
the exercise of such power shall be the property of Lessor, whether such award
shall be made as compensation for diminution in value of the leasehold or for
the taking of the fee, or as severance damages: provided, however, that Lessee
shall be entitled to any award for loss or damage to Lessee's trade fixtures and
removable personal property. In the event that this Lease is not terminated by
reason of such condemnation, Lessor shall to the extent of severance damages
received by Lessor in connection with such condemnation, repair any damage to
the Premises caused by such condemnation except to the extent that Lessee has
been reimbursed therefor by the condemning authority. Lessee shall pay any
amount in excess of such severance damages required to complete such
repair.

	Broker's Fee.

	Upon execution of this Lease by both parties, Lessor shall pay to Eric
Fuller & Associates, Inc. and Property Brokers. Licensed real estate
broker(s), a fee as set forth in a separate agreement between Lessor and said
broker(s), or in the event there is no separate agreement between Less r and
said broker(s), the sum of $ . for brokerage services rendered by s; i
broker(s) to Lessor in this transaction.
	Lessor further agrees that if Lessee exercises any Option, as defined in
paragraph 39.1 of this Lease, which is granted to Lessee under this Lease, or
any subsequently granted option which is substantially similar to an Option
granted to Lessee under this Lease, or if Lessee acquires any rights to the
Premises or other premises described in this Lease which are substantially
similar to what Lessee would have acquired had an Option herein granted to
Lessee been exercised, or if Lessee remains in possession of the Premises after
the expiration of the term of this Lease after having failed to exercise an
Option, or if said broker(s) are the procuring cause of any other lease or sale
entered into between the parties pertaining to the Premises and/or any adjacent
property in which Lessor has an interest, then as to any of said transactions,
Lessor shall pay said broker(s) a fee in accordance with the schedule of said
broker(s) in effect at the time of the execution of this Lease.
	Lessor agrees to pay said fee not only on behalf of Lessor but also on
behalf of any person, corporation, association, or other entity having an
ownership interest in said real property or any part thereof, when such fee is
due hereunder. Any transferee of Lessor's interests in this Lease, whether such
transfer is by agreement or by operation of law, shall be deemed to have assumed
Lessor's obligation under this paragraph 15. Said broker shall be a third party
beneficiary of the provisions of this paragraph 15.

	Estoppel Certificate.

	Each party (as "responding party") shall at any time upon not less than
ten (10) days' prior written notice from the other party ("requesting party")
execute, acknowledge and deliver to the requesting party a statement in writing
(i) certifying that this Lease is unmodified and in full force and effect (or,
if modified, stating the nature of such modification and certifying that this
Lease, as so modified, is in full force and effect) and the date to which the
rent and other charges are paid in advance, if any, and (ii) acknowledging that
there are not, to the responding party's knowledge, any uncured defaults on the
part of the requesting party, or specifying such defaults if any are claimed.
Any such statement may be conclusively relied upon by any prospective purchaser
or encumbrance of the Premises or of the business of the requesting party.
	At the requesting party's option, the failure to deliver such statement
within such times shall be a material default of this Lease by the party who is
to respond, without any further notice to such party, or it shall be conclusive
upon such party that (i) this 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.
	If Lessor desires to finance, refinance, or sell the Property, or any part
thereof, Lessee hereby agrees to deliver to any lender or purchaser designated
by Lessor such financial statements of Lessee as may be reasonably required by
such lender or purchaser. Such statements shall include the past three (3)
years' financial statements of Lessee. 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.

	Lessor's Liability.  The term "Lessor" as used herein shall mean only
the owner or owners, at the time in question, of the fee title or a lessee's
interest in a ground lease of the Industrial Center, and except as expressly
provided in paragraph 15, in the event of any transfer of such title or
interest, Lessor herein named (and in case of any subsequent transfers then the
grantor) shall be relieved from and after the date of such transfer of all
liability as respects Lessor's obligations thereafter to be performed, provided
that any funds in the hands of Lessor or the then grantor at the time of such
transfer, in which Lessee has an interest, shall be delivered to the grantee.
The obligations contained in this Lease to be performed by Lessor shall, subject
as aforesaid, be binding on Lessor's successors and assigns, only during their
respective periods of ownership.

	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.

	Interest on Past-Due Obligations.  Except as expressly herein
provided, any amount due to Lessor not paid when due shall bear interest at the
maximum rate then allowable by law from the date due. Payment of such interest
shall not excuse or cure any default by Lessee under this Lease; provided,
however, that interest shall not be payable on late charges incurred by Lessee
nor on any amount upon which late charges are paid by Lessee.

	Time of Essence.  Time is of the essence with respect to the
obligations to be performed under this Lease.

	Additional Rent. All monetary obligations of Lessee to Lessor under
the terms of this Lease, including but not limited to Lessee's, Share of
Operating Expenses and insurance and tax expenses payable shall be deemed to be
rent.

	Incorporation of Prior Agreements; Amendments.  This Lease contains
all agreements of the parties with respect to any matter mentioned herein. No
prior or contemporaneous agreement or understanding pertaining to any such
matter shall be effective. This lease may be modified in writing only, signed by
the patties in interest at the time of the modification. Except as otherwise
stated in this Lease, Lessee hereby acknowledges that neither the real estate
broker listed in paragraph 15 hereof nor any cooperating broker on this
transaction nor the Lessor or any employee or agents or any of said persons has
made any oral or written warranties or representations to Lessee relative to the
condition or use by Lessee of the Premises or the Property and Lessee
acknowledges that Lessee assumes all responsibility regarding the Occupational
Safety Health Act, the legal use and adaptability of the Premises and the
compliance thereof with all applicable laws and regulations in effect during the
term of this Lease except as otherwise specifically stated in this Lease.

	Notices.  Any notice required or permitted to be given hereunder
shall be in writing and may be given by personal delivery or by certified mail,
and if given personally or by mail, shall be deemed sufficiently given if
addressed to Lessee or to Lessor at the address noted below the signature of the
respective parties, as the case may be. Either party may by notice to the other
specify a different address for notice purposes except that upon Lessee's taking
possession of the Premises, the Premises shall constitute Lessee's address for
notice purposes. A copy of all notices required or permitted to be given to
Lessor hereunder shall be concurrently transmitted to such party or parties at
such addresses as Lessor may from time to time hereafter designate by notice to
Lessee.

	Waivers.  No waiver by Lessor or any provision hereof shall be deemed
a waiver of any other provision hereof or of any subsequent breach by Lessee of
the same or any other provision. Lessor's consent to, or approval of, any act
shall not be deemed to render unnecessary the obtaining of Lessor's consent to
approval of any subsequent act by Lessee. The acceptance of rent hereunder by
Lessor shall not be a waiver of any preceding breach by Lessee of any provision
hereof other than the failure of Lessee to pay the particular rent so accepted,
regardless of Lessor's knowledge of such preceding breach, at the time of
acceptance of such rent.

	Recording.  Either Lessor or Lessee shall, upon request of the other,
execute, acknowledge and deliver to the other a "short form" memorandum of this
Lease for recording purposes.

	Holding Over.  See Paragraph 51.

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

	Covenants and Conditions.  Each provision of this Lease performable
by Lessee shall be deemed both a covenant and a condition.

	Binding Effect; Choice of Law.  Subject to any provisions hereof
restricting assignment or subletting by Lessee and subject to the provisions of
paragraph 17, this Lease shall bind the parties, their personal representatives,
successors and assigns. This Lease shall be governed by the laws of the State
where the Industrial Center is located and any litigation concerning this Lease
between the parties hereto shall be initiated in the county in which the
Industrial Center is located.

	Subordination.

	This Lease, and any Option granted hereby, at Lessor's option, shall be
subordinate to any ground lease, mortgage, deed of trust, or any other
hypothecation or security now or hereafter placed upon the Industrial Center and
to any and all advances made on the security thereof and to all renewals,
modifications, consolidations, replacements and extensions thereof.
Notwithstanding such subordination, Lessee's right to quiet possession of the
Premises shall not be disturbed if Lessee is not in default and so long as
Lessee shall pay the rent and observe and perform all of the provisions of this
Lease, unless this Lease is otherwise terminated pursuant to its terms. If any
mortgagee, trustee, or ground lessor shall elect to have this Lease and any
Options granted hereby prior to the lien of its mortgage, deed of trust or
ground lease, and shall give written notice thereof to Lessee, this Lease and
such Options shall be deemed prior to such mortgage, deed of trust or ground
lease, whether this Lease or such Options are dated prior or subsequent to the
date of said mortgage, deed of trust or ground lease or the date of recording
thereof.
	Lessee agrees to execute any documents required to effectuate an attornment,
a subordination or to make this Lease or any Option granted herein prior to the
lien of any mortgage, deed of trust or ground lease, as the case may be.
Lessee's failure to execute such documents within ten (10) days after written
demand shall constitute a material default by Lessee hereunder without further
notice to Lessee or, at Lessor's option, Lessor shall execute such documents on
behalf of Lessee as Lessee's attorney-in-fact. Lessee does hereby make,
constitute and irrevocably appoint Lessor as Lessee's attorney-in-fact and in
Lessee's name, place and stead, to execute such documents in accordance with
this paragraph 30(b).

	Attorney's Fees.  If either party or the broker(s) named herein bring
an action to enforce the terms hereof or declare rights hereunder, the
prevailing party in any such action, on trial or appeal, shall be entitled to
his reasonable attorney's fees to be paid by the losing party as fixed by the
court. The provisions of this paragraph shall inure to the benefit of the broker
named herein who seeks to enforce a right hereunder.

	Lessor's Access.  Lessor and Lessor's agents shall have the right to
enter the Premises at reasonable times for the purpose of inspecting the same,
showing the same to prospective purchasers, lenders, or lessees, and making such
alterations, repairs, improvements or additions to the Premises or to the
building of which they are part as Lessor may deem necessary or desirable.
Lessor may at any time place on or about the Premises or the Building any
ordinary "For Sale" signs and Lessor may at any time during the last 120 days of
the term hereof place on or about the Premises any ordinary "For Lease" signs.
All activities of Lessor pursuant to this paragraph shall be without abatement
of rent, nor shall Lessor have any liability to Lessee for the same.

	Auctions.  Except for internet auction sales, Lessee shall not
conduct, nor permit to be conducted, either voluntarily or involuntarily, any
auction upon the Premises or the Common Areas without first having obtained
Lessor's prior written consent. Notwithstanding anything to the contrary in this
Lease, Lessor shall not be obligated to exercise any standard or reasonableness
in determining, whether to grant such consent.

	Signs.  Lessee shall not place any sign upon the Premises or the
Industrial Center without Lessor's prior written consent. Under no circumstances
shall Lessee place a sign on any roof of the Industrial Center.

	Merger.  The voluntary or ether surrender of this Lease by Lessee, or
a mutual cancellation thereof, or a termination by Lessor, shall not work a
merger, and shall, at the option of Lessor, terminate all or any existing
subtenancies or may, at the option of Lessor, operate as an assignment to Lessor
of any or all of such subtenancies.

	Consents.  Except for paragraph 33 hereof, wherever in this Lease the
consent of one party is required to an act of the other party such consent shall
not be unreasonably withheld or delayed.

	Guarantor.  In the event that there is a guarantor of this Lease,
said guarantor shall have the same obligations as Lessee under this Lease.

	Quiet Possession.  Upon Lessee paying the rent for the Premises and
observing and performing all of the covenants, conditions and provisions on
Lessee's part to be observed and performed hereunder, Lessee shall have quiet
possession of the Premises for the entire term hereof subject to all of the
provisions of this Lease. The individuals executing this Lease on behalf of
Lessor represent and warrant to Lessee that they are fully authorized and
legally capable of executing this Lease on behalf of Lessor and that such
execution is binding upon all parties holding an ownership interest in the
Property.

	Options.  

	Definition.  As used in this paragraph the word "Option" has the
following meaning: (1) the right or option to extend the term of this Lease or
to renew this Lease or to extend or renew any lease that Lessee has on other
property of Lessor; (2) the option or right of first refusal to lease the
Premises or the right of first offer to lease the Premises or the right of first
refusal to lease other space within the Industrial Center or other property of
Lessor; (3) the right or option to purchase the Premises or the Industrial
Center, or the right of first refusal to purchase. the Premises or the
Industrial Center, or the right of first offer to purchase the Premises or the
Industrial Center, or the right or option to purchase other property of Lessor,
or the right of first refusal to purchase other property of Lessor or the right
of first offer to purchase other property of Lessor.

	Options Personal.  Each Option granted to Lessee in this Lease is
personal to the original Lessee and may be exercised only by the original Lessee
while occupying the Premises who does so without the intent of thereafter
assigning this Lease or subletting the Premises or any portion thereof, and may
not be exercised or be assigned, voluntarily or involuntarily, by or to any
person or entity other than Lessee, provided, however, that an Option may be
exercised by or assigned to any Lessee Affiliate as defined in paragraph 12.2 of
this Lease. The Options, if any, herein granted to Lessee are not assignable
separate and apart from this Lease, nor may any Option be separated from this
Lease in any manner, either by reservation or otherwise.

	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 option to extend or renew this Lease has been so exercised.

	Effect of Default on Options.

	Lessee shall have no right to exercise an Option, notwithstanding any
provision in the grant of Option to the contrary, (i) during the time commencing
from the date Lessor gives to Lessee a notice of default pursuant to paragraph
13.1(b) or 13.1(c) and continuing until the noncompliance alleged in said notice
of default is cured, or (ii) during the period of time commencing on the date
after a monetary obligation to Lessor is due from Lessee and unpaid (without any
necessity for notice thereof to Lessee) and continuing until the obligation is
paid, or (iii) at any time after an event of default described in paragraphs
13.1(a), 13.1(d), or 13.1 (e) (without any necessity of Lessor to give notice of
such default to Lessee), or (iv) in the event that Lessor has given to Lessee
three or more notices of default under paragraph 13.1(b), or paragraph 13.1(c),
whether or not the defaults are cured, during the 12-month period of time
immediately prior to the time that Lessee attempts to exercise the Subject
Option.
	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).
	All rights of Lessee under the provisions of 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 during the term of this
Lease, (i) Lessee fails to pay to Lessor a monetary obligation of Lessee for a
period of 30 days after such obligation becomes due (without any necessity of
Lessor to give notice thereof to Lessee), or (ii) Lessee fails to commence to
cure a default specified in paragraph 13.1(c) within 30 days after the date that
Lessor gives notice to Lessee of such default and/or Lessee fails thereafter to
diligently prosecute said cure to completion, or (iii) Lessee commits a default
described in paragraph 13.1(a), 13.1(d), or 13.1(e) (without any necessity of
Lessor to give notice of such default to Lessee), or (iv) Lessor gives to Lessee
three or more notices of default under paragraph 13.1(b), or paragraph 13.1(c),
whether or not the defaults are cured.

	Security Measures.  Lessee hereby acknowledges that Lessor shall have
no obligation whatsoever to provide guard service or other security measures for
the benefit of the Premises or the Industrial Center. Lessee assumes all
responsibility for the protection of Lessee, its agents, and invitees and the
property of Lessee and of Lessee's agents and invitees from acts of third
parties. Nothing herein contained shall prevent Lessor, at Lessor's sole option,
from providing security protection for the Industrial Center or any part
thereof, in which event the cost thereof shall be included within the definition
of Operating Expenses, as set forth in paragraph 4.2(b).

	Easements.  Lessor reserves to itself the right, from time to time,
to grant such easements, rights and dedications that Lessor deems necessary or
desirable, and to cause the recordation of Parcel Maps and restrictions, so long
as such easements, rights, dedications, Maps and restrictions do not
unreasonably interfere with the use of the Premises by Lessee. Lessee shall sign
any of the aforementioned documents upon request of Lessor and failure to do so
shall constitute a material default of this Lease by Lessee without the need for
further notice to Lessee.

	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 tile right to make payment "under protest" and such payment
shall not be regarded as 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 under the provisions of
this Lease.

	Authority.  If Lessee is a corporation, trust, or general or limited
partnership, 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 behalf of said entity. If Lessee is a corporation, trust or
partnership, Lessee shall, within 30 days after execution of this Lease, deliver
to Lessor evidence of such authority satisfactory to Lessor.

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

	Offer.  Preparation of this Lease by Lessor or Lessor's agent and
submission of same to Lessee shall not be deemed an offer to lease. This Lease
shall become binding upon Lessor and Lessee only when fully executed by Lessor
and Lessee.

	Addendum.  Attached hereto is an addendum or addenda containing
paragraphs 47 through 53 which constitute a part of this Lease.  

LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM
AND PROVISION CONTAINED HEREIN AND, BY 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.

THIS LEASE HAS BEEN PREPARED FOR SUBMISSION TO YOUR ATTORNEY
FOR APPROVAL. NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR BY THE REAL ESTATE BROKER OR ITS AGENTS OR
EMPLOYEES AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS
LEASE OR THE TRANSACTION RELATING THERETO: THE PARTIES SHALL RELY SOLELY UPON
THE ADVICE OF THEIR OWN LEGAL COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF
THIS LEASE.

	
ADDRESSES FOR NOTICES AND RENT
	
ADDRESS

	
The Columbian Publishing Company

701 West 8" Street

Vancouver, WA 98660q
	
Egghead.com., Inc.

521 SE Chkalov

Vancouver, WA 98683

NOTE: 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, 345 So. Figueroa St., M-1, Los Angeles, CA 90071. (213)687-
8777.

THIS LEASE IS SUBJECT TO ACCEPTANCE BY LANDLORD:

IN WITNESS WHEREOF, the parties hereto have executed this lease the date and
year above written.

LESSOR:  The Columbian Publishing Company, 

a Washington corporation

By:   /s/ Douglas E. Ness

Its:  Vice President, Finance

Address: 701 West 8th Street

               Vancouver, WA  98660

LESSEE:Egghead.com, Inc.,

a Delaware corporation 

By:  /s/ Norman F Hullinger

Its:  Vice President of Sales and Operations

Address:  521 SE Chkalov

                ChkalovVancouver Washington

LESSOR:  

STATE OF Washington

County of  Clark

On October 17, 2000 before me, a Notary Public in and for said County and
State, residing therein, personally appeared Douglas E. Ness, who, being duly
sworn, did say that he is the Vice President, Finance of The Columbian, a
corporation and that said instrument was signed in behalf of said corporation by
authority of its board of directors; and he acknowledged said instrument to be
its voluntary act and deed.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the day and year last above written.

Barbara Samuels<Notary Seal>

My Commission Expires June 20, 2004

ADDENDUM A

	Commission.  Owner shall pay a commission or fee to Eric Fuller &
Associates, Inc. and Property Brokers in accordance with the provisions of a
separate commission contract. Each party represents that it has not had dealings
with any other real estate broker or salesman with respect to this Lease, and
each party shall defend, indemnify and hold harmless the other party from all
costs and liabilities including reasonable attorney's fees resulting from any
claims to the contrary.

	Agency Disclosure.  At the signing of this Agreement the listing
agent, William Connelly or Eric Fuller & Associates, Inc. represented the
Landlord. Greg Steele of Property Brokers represented the Tenant. Each party
signing this document confirms that prior oral and/or written disclosure of
agency was provided to him/her in this transaction. See Attached Exhibit D, Laws
of Real Estate Agency.

	Hazardous Materials.  During the term of this Lease, Tenant shall not
cause or permit any Hazardous Materials to be placed, held, located or disposed
of on, in or under the Premises or to otherwise affect the Premises in any
manner that violates federal, state or local laws, ordinances, rules,
regulations or policies now in effect or hereafter adopted governing the use,
storage, treatment, transportation, manufacture, refinement, handling,
production or disposal of Hazardous Materials (collectively, the "Environmental
Laws"). For purposes of this section, "Hazardous Materials" shall mean any
flammable substances, explosives, radioactive materials, hazardous materials,
hazardous wastes, toxic substances, pollutants, pollution or related materials
specified as such in, or regulated under, any of the Environmental Laws.
Landlord shall have neither the ability nor the duty to direct Tenant's
activities with respect to Hazardous Materials or its compliance with
Environmental Laws. At the expiration or earlier termination of this Lease,
Tenant shall cause any Hazardous Materials permitted or caused by the Tenant, to
be placed, held, located or disposed of on in, under or affecting the Premises
in any manner that violate the Environmental Laws to be cleaned up and removed
from the Premises at Tenant's expense in such manner as to comply with the
Environmental Laws. Tenant shall indemnify, defend and hold Landlord and present
and future owners of the property harmless from and against any and all losses,
liabilities, claims and expenses (including reasonable attorney fees through
appeal and fees of environmental engineers) arising out of or in any way
relating to any default by Tenant pursuant to this section, and the agreements
by Tenant in this section shall survive the expiration or earlier termination of
this Lease. Tenant shall immediately advise Landlord in writing of any and all
enforcement, cleanup, remedial, removal or other governmental or regulatory
actions instituted, completed or threatened pursuant to any Environmental Laws
affecting the Premises.

	Zoning Disclaimer.  This agreement will not allow use of the Property
described in this agreement in violation of applicable land use laws and
regulations. Before signing or accepting this agreement, the person acquiring
lease-hold to the Property should check with the appropriate City or County
planning department to verify approved uses.

	Holding Over.  Tenant will, at the termination of this Lease by lapse
of time or otherwise, yield up immediate possession to Landlord. If Landlord
agrees in writing that Tenant may hold over after the expiration or termination
of this Lease, unless the parties hereto otherwise agree in writing on the terms
of such holding over, the hold over tenancy shall be subject to termination by
Landlord at any time upon not less than five (5) days, advance written notice,
or by Tenant at any time upon not less than thirty (30) days advance written
notice, and all of the other terms and provisions of this Lease shall be
applicable during that period, except that Tenant shall pay Landlord from time
to time upon demand, as rental for the period of any hold over, an amount equal
to one and one-half (1-1/2) the Base Rent in effect on the termination date,
plus all additional rental as defined herein, computed on a daily basis for each
day of the hold over period, No holding over by Tenant,, whether with or without
consent of Landlord, shall operate to extend this Lease except as otherwise
expressly provided. The preceding provisions of this paragraph 51 shall not be
construed as Landlord's consent for Tenant to hold over.

	Rent Schedule:

a.MonthsMonthly Rent 

1-12$18,022.00 + operating expenses 

13-24$18,923.00 + operating expenses 

25-36$19,867.00 + operating expenses

b.Move In Expense: Tenant shall pay to Landlord the move in
expense as stated below upon lease execution:

First Month's Rent:$18,022.00

First Month's Operating Expense:$  5,406.00

Security Deposit:$19,867.00

Move in Expense Due and Payable at Lease
Execution:$42,935.00

	Counterparts:  This lease may be executed in one or more
counterparts, each of which shall be deemed as an original but all of which
together shall constitute one and the same instrument.

EXHIBIT A-1

To the Lease dated August 24, 2000, between The Columbian
Publishing Company, Lessor, and Egghead.com, Inc. a Delaware Corporation,
Lessee.

The leased premises consists of approximately 72,086 square
feet at 206 Grand Boulevard, Vancouver, Clark County, Washington which is
legally described as a portion of:  William Ryan DLC Lot 240.

The premises is commonly known as:

206 Grand Boulevard

Vancouver, WA  98661

[DRAWING OF 206 GRAND BOULEVARD]

EXHIBIT A-2

Note:  A temporary barrier will be erected at the appropriate
location highlighted, such that 300 parking spaces will be available including
those along the Grand Street property line (outside existing fences).

[DRAWING OF PARKING SPACES]

EXHIBIT A-3

To the Lease dated August 24, 2000, between The Columbian
Publishing Company, Lessor, and Egghead.com, Inc., a Delaware Corporation,
Lessee.

The leased premises consists of approximately 72,086 square
feet at 206 Grand Boulevard, Vancouver, Clark County, Washington which is
legally described as a portion of:  Wiliam Ryan DLC Lot 240.

The premises is commonly known as:

206 Grand Boulevard

Vancouver, WA  98661

[DRAWING OF 206 GRAND
BOULEVARD]

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