Document:

Prepared by MerrillDirect

STANDARD OFFICE LEASE

             THIS
LEASE is made and entered into as of this ____ day of April, 2001 (“Effective
Date”) by and between PACIFIC CORPORATE TOWERS LLC, a Delaware limited
liability company (“Landlord”), and EN POINTE TECHNOLOGIES, INC., a Delaware corporation
(“Tenant”).

             Landlord
hereby leases to Tenant and Tenant hereby leases from Landlord the premises
consisting of a portion of the ninth (9th) floor (“Ninth Floor Premises”), more
particularly described on Exhibit “A-1” attached hereto, and the entire
nineteenth (19th) floor (“Nineteenth Floor Premises”), more
particularly described in Exhibit “A-2” attached hereto, of that building whose
address is 100 N. Sepulveda Blvd., El Segundo, California (“Building”) (the
Ninth Floor Premises and the Nineteenth Floor Premises are hereafter
collectively referred to as the “Premises”). 
The Building is part of that certain office building project known as
Pacific Corporate Towers, which includes building(s), parking structure(s),
land and any other land or improvements surrounding the buildings which are
designated from time to time by Landlord as appurtenant to or servicing the
building(s) (“Project”).  Tenant hereby
leases the Premises for the term and upon the terms and conditions hereinafter
set forth, and Landlord and Tenant hereby agree as follows:

ARTICLE 1

BASIC LEASE PROVISIONS

	1.1	Term.	 
	 	 	 
	 	(a)	Early
  Occupancy Date:  June 1, 2001.
	 	 	 
	 	(b)	Commencement
  Date:  July 1, 2001.
	 	 	 
	 	(c)	Scheduled
  Expiration Date:  June 30, 2006.
	 	 	 
	1.2	Rentable
  Square Footage:	Approximately
  Thirty-six Thousand Ninety (36,090).
	 	 	 
	1.3	Basic
  Rental:	 
					

 

	Lease
  Month	Base
  

  Annual Rent	 	Monthly
  

  Installments	 	Monthly.

  Rental Rates	 
	

	

	 	

	 	

	 
	1–30	 	      $   
  1,082,700.00	 	 	      $     
  90,225.00	 	 	      $     
  2.50/RSF	 
	31–60	 	      $   
  1,126,008.00	 	 	      $     
  93,834.00	 	 	      $     
  2.60/RSF	 

 

	1.4	Base
  Year:	2001
	 	 	 
	1.5	Tenant’s
  Proportionate Share:	Three
  and Seven one tenths percent (3.7%) of Phase I.
				

 

	 	1.6	Security
  Deposit:  Cash in the amount of
  Ninety-three Thousand Eight Hundred Thirty-four Dollars ($93,834.00), subject
  to Article 4 hereof.
	 	 	 	 
	 	1.7	Permitted
  Use:	General
  office
	 	 	 	 
	 	1.8	Brokers:	CB
  Richard Ellis, Inc. for Landlord and The Seeley Company for Tenant
	 	 	 	 
	 	1.9	Parking
  Spaces:	One
  Hundred Forty-four (144) unreserved, subject to Article 23.
	 	 	 	 
	 	1.10	Parking
  Charge:	See
  Article 23
	 	 	 	 
	 	1.11	Tenant
  Address Prior to Lease Commencement Date:	 
					

EN POINTE TECHNOLOGIES, INC.

100 N. Sepulveda Boulevard, Suite 1900

El Segundo, CA 90245

ARTICLE 2

TERM

             2.1        Lease Term.  The term of this Lease (“Lease Term”) shall
be for a period of five (5) years (“Lease Term”) and shall commence (the
“Commencement Date”) on the date set forth in Article 1.1(b) of the Basic Lease
Provisions and shall end on the expiration date set forth in Article 1.1(c) of
the Basic Lease Provisions. 
Notwithstanding the foregoing, Tenant
shall have the right to occupy the Premises for a period of thirty (30) days
prior to the Commencement Date (“Early Occupancy Period”) commencing upon the
date set forth in Article 1.1 (a) of the Basic Lease Provisions (“Early
Occupancy Date”).  Tenant’s occupancy of
the Premises during the Early Occupancy Period shall be without payment of
Basic Rental and Tenant’s Proportionate Share of Direct Costs, but otherwise
subject to all of the terms and conditions of this Lease.  Tenant hereby acknowledges that
Tenant is currently in possession and occupancy of the Premises pursuant to
that certain Sublease (“Original Sublease”), dated August 30, 1996, entered
into by and between Tenant, as subtenant, and NCR International, Inc., as
sublandlord, as amended by that certain First Amendment to Sublease (“First
Amendment”), dated January 23, 1997, and as further amended by that certain
Second Amendment to Sublease (“Second Amendment”), dated May 28, 1997 (the
Original Sublease, First Amendment and Second Amendment shall hereinafter
collectively be referred to as the “Sublease”).  Tenant shall continue in possession and occupancy of the Premises
upon termination of the Sublease and hereby acknowledges that the Premises
shall be accepted by Tenant on the Early Occupancy Date in “as-is” condition
“with all faults,” and “without representation or warranties.”  At any time during the Lease Term, Landlord
may deliver to Tenant a notice in the form as set forth in Exhibit “D” attached
hereto, which Tenant shall execute and return to Landlord within ten (10) days
of receipt thereof.

             2.2        Measurement of Premises.  Prior to the Effective Date, Landlord caused
the actual rentable square footage of the Premises (“Actual RSF”) to be
determined by Landlord’s architect, Pace, in accordance with the BOMA-1996
Standard Method for

 Measuring Floor Area in Office
Buildings, and certified to both Landlord and Tenant.  The Actual RSF as certified by Pace shall be conclusive and
binding on Landlord and Tenant.

ARTICLE
3

RENTAL

             3.1        Basic
Rental. Tenant
agrees to pay to Landlord during the term hereof, at Landlord’s office or to
such other person or at such other place as directed from time to time by
written notice to Tenant from Landlord, the monthly and annual sums as set
forth in Article 1.3 of the Basic Lease Provisions, payable in advance on the
first day of each calendar month, without demand, setoff or deduction, and in
the event this Lease commences or the date of expiration of this Lease occurs
other than on the first day or last day of a calendar month, the rent for such
month shall be prorated. 
Notwithstanding the foregoing, Tenant shall pay to Landlord concurrently
with the execution of this Lease the amount of Two Hundred Seventy Thousand Six
Hundred Seventy-five Dollars ($270,675.00), representing the monthly
installments of Basic Rental due for the first (1st), second (2nd) and third
(3rd) months of the Lease Term and such amounts shall be applied against the
respective months of the Lease Term to which said amounts correspond.

             3.2        Increase in Costs.  The term “Base Year” means the calendar year
set forth in Article 1.4 of the Basic Lease Provisions.  If, in any calendar year during the term of
this Lease commencing with the calendar year immediately after the Base Year
(each such year a “Comparison Year”), (i) the “Tax Costs” (as hereinafter
defined) paid or incurred by Landlord shall be higher than the Tax Costs for the
Base Year, (ii) the “Operating Costs” (as hereinafter defined) paid or incurred
by Landlord shall be higher than the Operating Costs for the Base Year, or
(iii) the “Insurance Costs” (as hereinafter defined) paid or incurred by
Landlord shall be higher than the Insurance Costs for the Base Year, Tenant
shall pay Landlord as Additional Rent Tenant’s Proportionate Share (as provided
in Article 1.5 of the Basic Lease Provisions) of such increase in the amount by
which the respective Tax Costs, Operating Costs and Insurance Costs, paid or
incurred by Landlord in such Comparison Year exceed the respective Tax Costs,
Operating Costs and Insurance Costs incurred or paid by Landlord for the Base
Year.  In the event either the Premises
and/or the Project is expanded or reduced, then Tenant’s Proportionate Share
shall be appropriately adjusted, and as to the calendar year in which such
change occurs, Tenant’s Proportionate Share for such year shall be determined
on the basis of the number of days during that particular calendar year that
each such Tenant’s Proportionate Share was in effect.  In the event this Lease shall terminate on any date other than
the last day of a calendar year, Tenant’s Proportionate Share of Tax Costs,
Operating Costs and Insurance Costs for such calendar year in which this Lease
terminates shall be prorated on the basis of the relationship which the number
of days which have elapsed from the commencement of said calendar year to and
including said date on which this Lease terminates bears to three hundred sixty
(360).  Any and all amounts due and
payable by Tenant pursuant to Articles 3.2, 3.3 and 3.4 hereof shall be deemed
“Additional Rent” and Landlord shall be entitled to exercise the same rights and
remedies upon default in these payments.

             3.3        Definitions.  As used herein, the following terms shall
have the following meanings:

             (a)         “Tax Costs” shall mean any and all real estate taxes and
other similar charges on real property or improvements, assessments, water and
sewer charges, and all other charges assessed or levied upon the Project and
appurtenances thereto and the parking or other facilities thereof, or the real
property (the “Property”) thereunder (collectively the “Real Property”) or
attributable thereto or on the rents, issues, profits or income received or
derived therefrom which are assessed or levied by the United States, the State
of California or any local government authority or agency or any political
subdivision thereof, and shall include Landlord’s reasonable legal fees, costs
and disbursements incurred in connection with proceedings for reduction of Tax
Costs or any part thereof; provided, however, if at any time after the date of
this Lease the methods of taxation now prevailing shall be altered so that in
lieu of or as a supplement to or a substitute for the whole or any part of any
Tax Costs, there shall be assessed or levied (a) a tax, assessment, levy,
imposition or charge wholly or partially as a net income, capital or franchise
levy or otherwise on the rents, issues, profits or income derived therefrom, or
(b) a tax, assessment, levy (including but not limited to any municipal, state
or federal levy), imposition or charge measured by or based in whole or in part
upon the real property and imposed upon Landlord, or (c) a license fee measured
by the rent payable under this Lease, then all such taxes, assessments or
levies or the part thereof so measured or based, shall be deemed to be included
in the term “Tax Costs”.  Except as
otherwise provided in the preceding sentence, “Tax Costs” shall not include (i)
estate, inheritance, transfer, gift, or franchise taxes of Landlord or the
Federal or State net income tax imposed on Landlord’s net income (as opposed to
rents, receipts or income attributable to operations at the Building or
Project) or (ii) any items included as Operating Costs.  If Landlord receives a refund of Tax Costs
applicable to any Comparison Year and Tenant shall have paid its Proportionate
Share of the increase in Tax Costs for such Comparison Year, then Landlord
shall pay to Tenant, within a reasonable time, a sum equal to Tenant’s
Proportionate Share of (i) the Tax Costs refunded, less (ii) all costs incurred
by Landlord in connection with the refund; provided, however, any such refund
shall in no event exceed Tenant’s Proportionate Share of the increase in Tax
Costs for such Comparison Year.

             (b)        “Operating Costs” shall mean all costs,
expenses and amounts of every kind and nature incurred by Landlord in
connection with the maintenance, operation, replacement, ownership and repair
of the Project, the equipment, adjacent walks, malls and landscaped and common
areas and the parking structure, areas and facilities of the Project,
including, but not limited to, salaries, wages, medical, surgical and general welfare
benefits and pension payments, payroll taxes, fringe benefits, employment
taxes, workers’ compensation, uniforms and dry cleaning thereof for all persons
who perform duties connected with the operation, maintenance and repair of the
Project, its equipment and the adjacent walks and landscaped areas, including
janitorial, gardening, security, parking, operating engineer, elevator,
painting, plumbing, electrical, carpentry, heating, ventilation, air
conditioning, window washing, hired services (but excluding persons performing
services not uniformly available to or performed for the benefit of
substantially all building tenants) (except that such salaries, wages, medical,
surgical, and general welfare benefits and pension payments, payroll taxes,
fringe benefits, employment taxes, worker’s compensation, uniform costs and dry
cleaning costs shall be reasonably allocated to the Project in the proportion
that the time spent by such persons in connection with the Project bears to the
total time spent by such persons on the Project and other projects), a
reasonable allowance for depreciation of the cost of acquiring or the rental
expense of personal property used in the maintenance, operation and repair of
the Project, accountant’s fees incurred in the preparation of rent adjustment
statements, legal fees, real estate tax consulting fees, personal property
taxes on property used in the maintenance and operation of the Project, capital
expenditures incurred (i) to effect economies of operation, (ii) for capital repairs
and replacements incurred in connection with the operation and maintenance of
the Project, and (iii) to make alterations, additions or improvements to the
Project required by government regulations, laws, or ordinances; the cost of
all charges for electricity, gas, water and other utilities furnished to the
Project, including any taxes thereon; the cost of all building and cleaning
supplies and materials; the cost of all charges for cleaning, maintenance and
service contracts and other services with independent contractors (including
property management fees and administrative fees; provided, however, property
management and administrative fees included in Operating Costs shall be
consistent with property management fees and administrative fees charged at
Class “A” office building projects in the City of El Segundo); the cost of
operation of any airport shuttle service provided by the Project; and license,
permit and inspection fees relating to the Project.  In the event, during any calendar year, the Project is less than
one hundred percent (100%) occupied at all times, the Operating Costs shall be
adjusted to reflect the Operating Costs of the Project as though one hundred
percent (100%) occupied at all times, and the increase or decrease in rent shall
be based upon such Operating Costs as so adjusted.  Operating Costs shall also include all management fees and
administrative fees.  Landlord shall
have the right, from time to time, to equitably allocate some or all of the
Operating Costs among different tenants of the Project (i.e. office space and
retail space tenants of the Project). 
In no event shall Landlord be entitled to collect more than one hundred
percent (100%) of the Operating Costs incurred by Landlord in any Comparison
Year without giving consideration to the base year in any tenant’s lease.

             Operating Costs shall not
include: (i) mortgage interest, debt service or ground rent on the Project;
(ii) the cost of repairs, replacements and general maintenance to the extent
Landlord receives reimbursement for such costs in the same Comparison Year as
incurred from insurance proceeds, warranties, guaranties or third parties
(provided, however, if any such reimbursement is not received in the Comparison
Year when such expense was incurred, the reimbursement shall be applied to
Operating Costs for the Comparison Year in which such reimbursement is
received); (iii) the cost of renovating or otherwise improving space for
individual tenants of the Project; (iv) depreciation of the Project; (v) marketing
costs, leasing commissions or fees in lieu of commissions or other costs
incurred in procuring tenants; (vi) advertising and promotional expenses and
costs of signs in or on the Building identifying the owner of the Building;
(vii) the cost of any alterations, additions or changes to the Project required
to be made to comply with applicable governmental regulations, laws, or
ordinances to the extent such compliance is required prior to the Effective
Date; (viii) tax penalties incurred as a result of Landlord’s failure to make
payments and/or to file any tax or informational returns when due; (ix) costs
arising from Landlord’s charitable or political contributions; (x) costs, other
than those incurred in ordinary maintenance and repair, for sculpture, paintings,
fountains or other objects of art, except if such art is required by law; (xi)
costs, including attorneys’ fees and costs of settlement, judgments and
payments in lieu thereof, arising from claims, disputes or potential disputes
with individual tenants; (xii) costs associated with the operation of the
business of the person or entity which constitutes Landlord (as the same are
distinguished from the costs of operation of the Project); and (xiii) any
“finders’ fees,” brokerage commissions or job placement costs.

             (c)         “Insurance Costs” shall mean the cost of all charges for
fire and extended coverage, commercial liability and all other insurance for
the Project required to be carried by Landlord under the Lease or now or
hereafter maintained by Landlord with respect to the Project.

             (d)        “Direct Costs” as used herein shall mean
the Tax Costs, Operating Costs, and Insurance Costs.

             (e)         “Phase I” shall mean the portion of the
Project consisting of the buildings commonly known as 100 and 200 North
Sepulveda Boulevard ("Phase I Buildings") together with the Phase I
Buildings' percentage share (based on a fraction, the numerator of which is the
rentable square footage of the Phase I Buildings and the denominator of which
is the entire rentable square footage of the Project) in the common facilities
of the Project, such as the parking structure, land and other improvements
comprising the Project.  Landlord
allocates Direct Costs either (i) to Phase I, in which case all of the
allocated Direct Costs benefit and are paid by the tenants of Phase I or (ii)
to the Project as a whole, in which case all of the allocated Direct Costs
benefit and are paid by the tenants of the entire Project.  If a Direct Cost is allocated to Phase I,
Tenant’s share of such Direct Cost shall be equal to a fraction, the numerator
of which is the rentable square footage in the Premises and the denominator of
which is the total rentable square footage of the Phase I Buildings.  If a Direct Cost is allocated to the Project
as a whole, then Tenant pays its proportionate share of the Phase I portion of
such Direct Cost.  Tenant’s share of the
Phase I portion of a Direct Cost is equal to a fraction, the numerator of which
is the rentable square footage in the Premises and the denominator of which is
the total rentable square footage of the Phase I Buildings.  For purposes hereof, the rentable square
footage of Phase I is approximately nine hundred seventy-six thousand three
hundred four (976,304) and the rentable square footage of the Project is approximately
one million five hundred forty-two thousand two hundred seventy (1,542,270).

             3.4        Determination of Payment  Landlord shall, prior to the commencement of
each Comparison Year, furnish to Tenant a written estimate showing in
reasonable detail Landlord’s estimated Direct Costs for the next following
Comparison Year and the amount of Tenant’s Proportionate Share of the increase
in Tax Costs, Operating Costs and Insurance Costs appropriately prorated on a
monthly basis for such Comparison Year. 
Thereafter, on each monthly rental payment date, Tenant shall pay to
Landlord the monthly amount of Tenant’s Proportionate Share of the estimated
increase in Direct Costs as shown in said written estimate.  Landlord reserves the right to revise any
estimate of Direct Costs if actual or projected Tax Costs, Operating Costs or
Insurance Costs show an increase or decrease from any earlier estimate for the
same Comparison Year.  If Landlord
delivers such revised estimate to Tenant at any time during the Comparison
Year, Tenant shall commence payment of such estimated amount on the next
monthly rental payment as shown in the revised estimate.  Neither Landlord’s failure to deliver nor
the late delivery of such estimate shall constitute a default by Landlord
hereunder or a waiver of Landlord’s right to receive Tenant’s Proportionate
Share of the estimated increase in Direct Costs and Tenant shall continue to
pay on the basis of the most recent estimate until Landlord delivers a new
estimate of Direct Costs to Tenant. Within one hundred eighty (180) calendar
days following the close of each Comparison Year during the term hereof,
Landlord shall endeavor to furnish to Tenant a written statement (the
“Reconciliation”) showing in reasonable detail Landlord’s actual Tax Costs,
Operating Costs and Insurance Costs for the relevant Comparison Year, together
with a full statement of any adjustments necessary to reconcile any sums paid
(or credited) hereunder as Tenant’s Proportionate Share of Tax Costs, Operating
Costs and Insurance Costs during such Comparison Year with those sums actually
payable and due hereunder for such Comparison Year as set forth in the
Reconciliation.  If the Reconciliation
shows that additional sums are due from Tenant hereunder, Tenant shall pay such
sums to Landlord within thirty (30) days of receipt of the Reconciliation.  If the Reconciliation shows that a credit is
due Tenant, such credit shall be credited against the next sums becoming due
from Tenant hereunder. After the Reconciliation is delivered, Landlord may not
bill Tenant for Tenant’s Proportionate Share of Direct Costs incurred in a
Comparison Year after the delivery of the Reconciliation for such Comparison
Year, but Landlord may include Direct Costs applicable to such prior Comparison
Year in the Direct Costs for a subsequent Comparison Year to the extent
Landlord receives an invoice in the subsequent Comparison Year for Direct Costs
applicable to the prior Comparison Year. 
Notwithstanding that the term of this Lease has expired and Tenant has
vacated the Premises, Tenant shall pay to Landlord any additional sums due
Landlord and Landlord shall rebate to Tenant the amount of any credit due
Tenant, as set forth in the Reconciliation for the Comparison Year in which the
Lease Term expired.

             3.5        Review of Direct Expenses.  In the event of any dispute as to any Direct Costs payable by
Tenant as shown in a Reconciliation for a Comparison Year, Tenant shall have
the right, within one hundred eighty (180) days after the date of Tenant’s
receipt of such Reconciliation and after reasonable notice and at reasonable
times, to inspect Landlord’s records pertaining to Direct Costs for the
Comparison Year in question at Landlord’s regional accounting office or at the
Project.  Tenant’s failure to exercise
its right to inspect records pertaining to Direct Costs for any Comparison Year
within one hundred eighty (180) days after the date of Tenant’s receipt of the
Reconciliation for such Comparison Year shall be deemed Tenant’s waiver of its
right to inspect Landlord’s records for such Comparison Year and acceptance of
the Direct Costs paid by Tenant for such Comparison Year.  If, after such inspection, Tenant still
disputes the Direct Costs paid by Tenant for such Comparison Year, Tenant may
have a certification as to Tenant’s proportionate share of Direct Costs for
such Comparison Year made by an independent certified public accountant who is
a member of one of the “Big-Five” national accounting firms.  The accounting firm retained by Tenant shall
be subject to the prior written approval of Landlord, which approval shall not
be unreasonably withheld.  It shall not
be unreasonable for Landlord to withhold its consent if the accounting firm has
any conflict of interest with respect to Landlord, as determined by Landlord,
or is then involved in a dispute which also involves Landlord.  In no event, however, shall Tenant retain an
independent certified public accountant whose compensation is based on a
percentage of any savings to Tenant of Direct Costs resulting from such
certification.  Promptly upon receipt of
the certification from its accountant, Tenant shall deliver a copy of the
certification to Landlord.  When a final
determination has been made as to the amount in dispute, Landlord shall pay the
amount determined to be owed to Tenant, or Tenant shall pay the amount
determined to be owed to Landlord, as applicable, within thirty (30) days after
the date of the final determination.  As
a condition precedent to its exercise of its rights of dispute as set forth herein,
Tenant shall timely pay to Landlord all amounts set forth in the Reconciliation
which Tenant wishes to dispute.

ARTICLE 4

SECURITY DEPOSIT

             Tenant
has deposited with Landlord cash in the amount of Ninety-three Thousand Eight
Hundred Thirty-four Dollars ($93,834.00) as security for the full and faithful
performance of every provision of this Lease to be performed by Tenant.  If Tenant breaches any provision, covenant
or condition of this Lease, including but not limited to the payment of Basic
Rental or Additional Rent, Landlord may (but shall not be required to) use all
or any part of this Security Deposit for the payment of any sums in default, or
to compensate Landlord for any other loss or damage which Landlord may suffer
by reason of Tenant’s default.  If any
portion of said Security Deposit is so used or applied, Tenant shall, within
ten (10) days after written demand therefor, deposit cash with Landlord in an
amount sufficient to restore the Security Deposit to its original amount and
Tenant’s failure to do so shall be an Event of Default.  Landlord shall not be required to keep this
Security Deposit separate from its general funds and Tenant shall not be
entitled to interest on such deposit. 
Within thirty (30) days after the expiration of the Lease Term, and
provided there exists no default by Tenant hereunder, the Security Deposit or
any balance thereof shall be returned to Tenant (or, at Landlord’s option, to
Tenant’s assignee), provided that subsequent to the expiration of this Lease,
Landlord may retain from said Security Deposit (a) any and all amounts
permitted by California Civil Code § 1950.7 but not limited to this
section and (b) such sums as Landlord reasonably estimates will thereafter
become due under this Lease.  Should
Landlord sell its interest in the Premises during the term hereof, and if
Landlord deposits with the purchaser thereof the then unappropriated funds
deposited by Tenant as aforesaid, Landlord shall be discharged from any
liability with respect to such Security Deposit.

ARTICLE 5

HOLDING OVER

             Should
Tenant, with Landlord’s written consent, hold over after termination of this
Lease, Tenant shall become a tenant from month to month only upon each and all
of the terms herein provided as may be applicable to a month to month tenancy
and any such holding over shall not constitute an extension of this Lease.  During the first (1st) month of
any such holding over with consent, Tenant shall pay in advance, monthly, a
rental rate equal to one hundred twenty-five percent (125%), and thereafter,
one hundred fifty percent (150%) of the Basic Rental in effect for the last
month of the term of this Lease, in addition to, and not in lieu of, all other
payments required to be made by Tenant hereunder including but not limited to
Tenant’s Proportionate Share of Direct Costs. 
If Tenant holds over after termination of this Lease without the express
written consent of Landlord, Tenant shall become a tenant at sufferance only.  Tenant agrees that the reasonable value of
the use of the Premises during any holding over without consent shall be two
hundred percent (200%) of the Basic Rental in effect upon the date of such
termination (pro rated on a daily basis). 
Acceptance by Landlord of rent after such termination shall not
constitute a hold over hereunder or result in a renewal.  If Tenant fails to surrender the Premises
upon the expiration or termination of this Lease, Tenant shall indemnify,
defend and hold Landlord harmless from all costs, losses, expenses or
liabilities, including without limitation, costs and reasonable attorney fees.

ARTICLE 6

PERSONAL PROPERTY

             Tenant
shall pay, prior to delinquency, all taxes assessed against or levied upon
fixtures, furnishings, equipment and all other personal property of Tenant
located in the Premises.  In the event
any or all of Tenant’s fixtures, furnishings, equipment and other personal
property shall be assessed and taxed with property of Landlord, Tenant shall
pay to Landlord its share of such taxes within thirty (30) days after delivery
to Tenant by Landlord of a statement in writing setting forth the amount of
such taxes applicable to Tenant’s property. 
Tenant shall assume and pay to Landlord at the time of paying Basic
Rental any excise, sales, use, rent, occupancy, garage, parking, gross receipts
or other taxes (other than net income taxes) which may be imposed on or on
account of letting of the Premises or the payment of Basic Rental or any other
sums due or payable hereunder, and which Landlord may be required to pay or
collect under any law now in effect or hereafter enacted.  Tenant shall pay directly to the party or
entity entitled thereto all business license fees, gross receipts taxes and
similar taxes and impositions which may from time to time be assessed against
or levied upon Tenant, as and when the same become due and before
delinquency.  Notwithstanding anything
to the contrary contained herein, any sums payable by Tenant under this Article
6 shall not be included in the computation of “Tax Costs.”

ARTICLE 7

USE

             Tenant
shall use and occupy the Premises only for the use set forth in Article 1.7 of
the Basic Lease Provisions and shall not use or occupy the Premises or permit
the same to be used or occupied for any other purpose without the prior written
consent of Landlord, and Tenant agrees that it will use the Premises in such a
manner so as not to interfere with or infringe upon the rights of other tenants
in the Project.  Tenant shall, at its
sole cost and expense, promptly comply with all laws, statutes, ordinances and
governmental regulations or requirements now in force or which may hereafter be
in force relating to or affecting the condition, use or occupancy of the
Premises or the Project.  Tenant shall,
at its sole cost and expense, make any and all alterations, improvements or
structural changes, that are required by laws, statutes, ordinances and
governmental regulations or requirements as a result of Tenant’s particular use
of the Premises or any alterations, additions or improvements made by Tenant.  Any other alterations, improvements or
structural changes to the Premises or the Project that are required by laws,
statutes, ordinances and governmental regulations or requirements, and not due
to Tenant’s particular use of the Premises or Tenant’s alterations, additions or
improvements, shall be made by Landlord, and the cost thereof shall be an
Operating Cost.  Tenant shall not do or
permit to be done anything which will invalidate or increase the cost of any
fire and extended coverage insurance policy covering the Project and/or the
property located therein and Tenant shall comply with all rules, orders,
regulations and requirements of any organization which sets out standards,
requirements or recommendations commonly referred to by major fire insurance
underwriters.  Tenant shall promptly
upon demand reimburse Landlord for any additional premium charges for such
policy by reason of Tenant’s failure to comply with the provisions of this
Article.

ARTICLE 8

CONDITION OF PREMISES

             Tenant
acknowledges that Tenant is currently in possession and occupancy of the
Premises and hereby agrees that the Premises shall be taken in “as is”
condition, “with all faults”, “without any representations or warranties”.  Tenant hereby agrees and warrants that it is
familiar with the condition of the Premises and the suitability of same for
Tenant’s purposes, and Tenant does hereby waive and disclaim any objection to,
cause of action based upon, or claim that its obligations hereunder should be
reduced or limited because of the condition of the Premises or the Project or
the suitability of same for Tenant’s purposes. 
Tenant further acknowledges that Landlord has no obligation to alter or
improve the Premises for Tenant’s use or benefit other than to make the
Allowance available to Tenant for Tenant’s construction of the Tenant Work
pursuant to the Work Letter Agreement attached hereto as Exhibit “C” (“Work
Letter Agreement”).  Tenant hereby
acknowledges that pursuant to a separate agreement Landlord intends to acquire
title to certain furniture and equipment currently used by Tenant in the
Premises, and more particularly described in Exhibit “F” attached hereto
(“Existing Furniture”).  Subject to
Landlord’s acquisition of title to the Existing Furniture, promptly after the
Commencement Date, Landlord shall transfer title to the Existing Furniture to
Tenant pursuant to a bill of sale. 
Tenant hereby acknowledges and agrees that neither Landlord nor any
agent or employee of Landlord has made any representations or warranty with
respect to the Existing Furniture and that said Existing Furniture shall be
taken in “as is” condition, “with all faults”, “without any representations or
warranties” and that Landlord shall have no duty to repair or maintain said
Existing Furniture.  Tenant acknowledges
that neither Landlord nor any agent nor any employee of Landlord has made any
representations or warranty with respect to the Premises or the Project or with
respect to the suitability of either for the conduct of Tenant’s business.  The taking of possession of the Premises by
Tenant shall conclusively establish that the Premises and the Project were at
such time in satisfactory condition. 
Tenant hereby waives and releases its right to make repairs at
Landlord’s expense pursuant to Sections 1941 and 1942 of the Civil Code of
California or under any similar law, statute or ordinance now or hereafter in
effect.

ARTICLE 9

REPAIRS AND ALTERATIONS

             9.1        Tenant Repairs.  Except for matters which are Landlord’s
responsibility under Article 9.2, Tenant shall keep the Premises in good
condition and repair.  Tenant shall, at
Tenant’s sole cost and expense, maintain and repair the Existing
Furniture.  All damage or injury to the
Premises or the Project caused by the act or negligence of Tenant, its
employees, agents or visitors, guests, invitees or licensees shall be promptly
repaired by Tenant, at its sole cost and expense, to the reasonable
satisfaction of Landlord.  Landlord may
make any repairs which are not made by Tenant within ten (10) days after
Landlord’s notice of Tenant’s failure to repair (provided, however, no notice
shall be required in the event of an emergency) and charge Tenant for the cost
thereof, which cost shall be paid by Tenant within ten (10) days from invoice
from Landlord.  Tenant shall be
responsible for the design and function of all non-standard improvements of the
Premises, whether or not installed by Landlord at Tenant’s request.  Tenant waives all rights to make repairs at
the expense of Landlord, or to deduct the cost thereof from the rent.

             9.2        Landlord Repairs.         Landlord
shall be responsible for performing all maintenance, repairs or replacements of
(i) Building-wide mechanical systems, including electrical (to the
connection with the circuit breakers for the Premises), plumbing (to the point
where the Building plumbing system ties into any plumbing located in the
Premises), water (except any alterations or additions to such system made by
Tenant), sanitary sewer, heating, ventilating and air conditioning, including
chilled water (but not any supplemental heating, ventilating and air
conditioning unit servicing the Premises), telephone (to the main point of
entry for the Premises) and life safety systems (all such systems are hereafter
referred to as “Building Systems”); provided, however, Landlord shall not be
responsible for maintenance, repair or replacement of any alteration made to
the Building Systems as part of the Tenant Work or any alterations made by
Tenant; (ii) the roof, structural components of the Building, foundation,
support columns, windows, window frames and all exterior and common area glass;
(iii) the restrooms; and (iv) the common areas of the Project, including
without limitation, the parking structure, landscaping, walkways, common
entrances, corridors, windows, loading docks, stairways and similar
facilities.  If the need for any repairs
or maintenance to any of the foregoing is made necessary by the negligence or
willful misconduct of Tenant, its employees, agents, or contractors, or visitors,
guests, invitees or licensees, then Tenant shall pay Landlord the cost of such
repair, maintenance or replacement within five (5) days after receipt of
Landlord’s invoice therefor.  Except for
maintenance, repairs or replacement made necessary by the negligence or willful
misconduct of Tenant, its employees, agents or contractors, or visitors,
guests, invitees or licensees, as provided in this Article 9.2, all costs
incurred by Landlord pursuant to this Article 9.2 shall be Operating
Costs.

             9.3        Alterations.      Tenant shall make no alterations, changes
or additions in or to the Premises without Landlord’s prior written consent,which
consent shall not be unreasonably withheld (except that it shall be deemed
reasonable for Landlord to withhold consent to non-standard office alterations
or alterations that are structural or affect the Building Systems or exterior,
or are visible from the exterior of the Premises), and then only by contractors
or mechanics approved by Landlord and upon the approval by Landlord of fully
detailed and dimensioned plans and specifications pertaining to the work in
question, to be prepared and submitted by Tenant at its sole cost and
expense.  Tenant shall at its sole cost
and expense obtain all necessary approvals and permits pertaining to any work
approved by Landlord.  If Landlord, in
approving any work, specifies a commencement date therefor, Tenant shall not
commence any work prior to such date. 
Tenant hereby indemnifies and agrees to defend and hold Landlord free
and harmless from all liens and claims of lien, and all other liability, claims
and demands arising out of any work done or material supplied to the Premises
by or at the request of Tenant.  If
permitted alterations, changes, or additions are made, they shall be made at
Tenant’s expense and shall be and become the property of Landlord, except that
Landlord may, by written notice to Tenant given at the time Landlord consents
to such alteration, addition or improvement, require Tenant, at Tenant’s
expense, to promptly both remove any such alteration, change or addition and
repair counters, railings and the like installed by Tenant, and to repair any
damage to the Premises caused by such removal and restore the Premises to the
condition that existed prior to such alteration in accordance with all
applicable laws, statutes, building codes and regulations in effect as of the
date of such restoration.  With regard
to repairs, alterations or any

 other work arising from or related to
this Article 9, Landlord shall be entitled to receive an
administrative/supervision fee of fifteen percent (15%) of the total cost of
all (i) work performed; (ii) materials, plans and drawings furnished; and (iii)
all other costs and expenses related to such repairs, alterations or other
work.

ARTICLE 10

LIENS

             Tenant
shall keep the Premises, Building and Project free from any mechanics’ liens,
vendors liens or any other liens arising out of any work performed, materials
furnished or obligations incurred by Tenant, and Tenant shall defend, indemnify
and hold harmless Landlord from and against any such lien, claim, liability or
action thereon, together with costs of suit and reasonable attorneys’ fees
incurred by Landlord in connection with any such lien, claim, liability or
action.  Before commencing any work of
alteration, addition or improvement to the Premises, Tenant shall give Landlord
at least ten (10) business days’ written notice of the proposed commencement of
such work (to afford Landlord an opportunity to post appropriate notices of
non-responsibility) and shall secure, at Tenant’s own cost and expense, a
completion and lien indemnity bond, reasonably satisfactory to Landlord, for
said work.  In the event that there
shall be recorded against the Premises or the Building or the property of which
the Premises is a part any claim or lien arising out of any such work
performed, materials furnished or obligations incurred by Tenant and such claim
or lien shall not be removed or discharged within ten (10) days of filing,
Landlord shall have the right but not the obligation to pay and discharge said
lien without regard to whether such lien shall be lawful or correct or to
require that Tenant deposit with Landlord in cash, lawful money of the United
States, one hundred fifty percent (150%) of the amount of such claim, which sum
may be retained by Landlord until such claim shall have been removed of record
or until judgment shall have been rendered on such claim and such judgment
shall have become final, at which time Landlord shall have the right to apply
such deposit in discharge of the judgment on said claim and any costs,
including attorneys’ fees incurred by Landlord, and shall remit the balance
thereof to Tenant.  If Landlord pays and
discharges said lien, then Tenant shall reimburse Landlord for all costs and
expenses incurred by Landlord in discharging such lien, including attorneys’
fees, within ten (10) days after the date of receipt of Landlord’s invoice
therefor.

ARTICLE 11

PROJECT SERVICES

             11.1      Building Hours   Landlord agrees to furnish to the
Premises from 8:00 a.m. to 6:00 p.m. Mondays through Fridays and 9:00 a.m. to
1:00 p.m. on Saturdays, local and national holidays excepted (“Building
Hours”), air conditioning and heat, elevator service, electric current (subject
to Article 11.2) for normal lighting and fractional horsepower for office
machines and, on the same floor as the Premises, water for lavatory and
drinking purposes, all in such reasonable quantities as in the judgment of
Landlord is reasonably necessary for the comfortable occupancy of the Premises.  Janitorial and maintenance services will be
furnished five (5) days per week.  Such
janitorial service shall be provided in accordance with standards for
comparable class “A” office buildings in the City of El Segundo.  Tenant shall comply with all rules and
regulations which Landlord may reasonably establish for the proper functioning
and protection of the air conditioning, heating, elevator, electrical and
plumbing systems.  Landlord shall not be
liable for, 

and there shall be no rent abatement as a result of, any stoppage, reduction or
interruption of any such services caused by governmental rules, regulations or
ordinances, riot, strike, labor dispute, breakdowns, accidents, necessary
repairs or any other cause.  Except as
specifically provided in this Article 11, Tenant agrees to pay for all
utilities and other services utilized by Tenant for all overtime or additional
building services furnished to Tenant not uniformly furnished to all tenants of
the Project at Landlord’s expense. Landlord’s obligation to render to the
Premises services during non-Building Hours or above-standard building services
shall be conditioned upon the payment by Tenant of all sums charged by Landlord
for such services pursuant to this Article 11.

             11.2      Electricity Use.  Landlord shall supply electricity to the
Premises during Building Hours in an amount sufficient to support a peak
electrical demand in the Premises, inclusive of lighting, heating, ventilation
and air conditioning and receptacle load (“Peak Demand”), in the amount of four
(4) watts per usable square foot in the Premises.  Tenant shall not, without the prior written consent of Landlord,
use electricity in the Premises that would cause the Peak Demand in the
Premises to exceed four (4) watts per usable square foot in the Premises.  If Tenant shall require electric current to
support a Peak Demand in excess of four (4) watts per usable square foot in the
Premises, Tenant shall first obtain the written consent of Landlord.  Landlord may withhold consent or withdraw
consent to a request for additional electricity in the Premises if (i) Landlord
would be required to modify or increase the electrical capacity of the Building
or Project to supply such additional electricity as a result of current or
future tenant needs, or (ii) if as a result of supplying such excess
electricity to Tenant, Landlord would be unable to furnish the other current or
future tenants in the Building similar electric capacity as supplied to Tenant.

             Tenant
shall install, as part of the Tenant Work, a separate meter to measure
electricity supplied to the Premises. 
Tenant shall pay to Landlord, within thirty (30) days after the date of
Landlord’s invoice, the cost for all electricity supplied to the Premises
during Building Hours in excess of a Peak Demand of four (4) watts per usable
square foot as shown by said meter at the rate charged for such service by
Landlord’s electricity provider, plus any reasonable additional expense
incurred by Landlord in keeping account of the electricity so consumed.  The cost of electricity furnished to Tenant
during Building Hours that does not exceed a Peak Demand of four (4) watts per
usable square foot in the Premises shall be included within Operating
Costs.  The cost of electricity furnished
to Tenant during non-Building Hours that does not exceed one (1) watt per
usable square foot in the Premises (excepting non-Building Hours lighting and
heating, ventilation and air conditioning as set forth in Article 11.4 hereof)
shall be included within Operating Costs. 
Subject to Article 11.4 hereof, Tenant shall pay for the cost of
electricity in excess of one (1) watt per rentable square foot in the Premises
supplied to the Premises during non-Building Hours as measured by the separate
meter at the rates charged for such service by Landlord’s electricity provider,
plus any reasonable additional expense incurred by Landlord in keeping account
of the electricity so consumed.

             Notwithstanding the foregoing, if
Tenant installs a computer room, supplemental heating, ventilation and air
conditioning units, or any equipment or special alterations in the Premises
that use substantial amounts of electricity (collectively, “Supplemental
Equipment”), all electricity supplied to such Supplemental Equipment shall be
separately metered (as set forth below). 
Tenant shall install a separate meter to measure the electricity
supplied to the Supplemental Equipment and the cost of any such separate meter
and the installation, maintenance and repair thereof shall be paid by
Tenant.  The electricity supplied to the
Supplemental Equipment shall be included in the four (4) watts per usable
square foot of electricity supplied to the Premises during Building Hours and
the one (1) watt per usable square foot of electricity supplied to the Premises
during non-Building Hours and Tenant shall pay all costs of electricity
supplied to the Supplemental Equipment in excess of four (4) watts per usable
square foot in the Premises during Building Hours and one (1) watt per usable
square foot in the Premises during non-Building Hours in accordance with the
preceding paragraph.

             11.3      Heat Generating Machines.  If any lights, machines or equipment
(including but not limited to computers) are used by Tenant in the Premises
which materially affect the temperature otherwise maintained by the air
conditioning system, or generate substantially more heat in the Premises than
would be generated by the building standard lights and usual fractional
horsepower office equipment, Landlord shall have the right to install any
machinery and equipment which Landlord reasonably deems necessary to restore
temperature balance, including but not limited to modifications to the standard
air conditioning equipment, and the cost thereof, including the cost of
installation and any additional cost of operation and maintenance occasioned
thereby, shall be paid by Tenant to Landlord upon demand by Landlord.  Landlord shall not be liable under any
circumstances for loss of or injury to property, however occurring, through or
in connection with or incidental to failure to furnish any of the foregoing.

             11.4      After-Hours HVAC/Lighting.   If Tenant requires heating, ventilation
and/or air conditioning during non-Building Hours, Tenant shall give Landlord
such advance notice as Landlord shall reasonably require and shall pay Landlord
for the use of such equipment and service at Landlord’s prevailing rate,
currently Thirty-eight Dollars ($38) per hour, which rate may change from time
to time during the Lease Term.  Anything
to the contrary contained in this Article 11 notwithstanding, if Tenant
requires lighting in the Premises during non-Building Hours, Tenant shall give
Landlord such advance notice as Landlord shall reasonably require and shall pay
Landlord for the use of such electrical service at Landlord’s prevailing rate,
currently Five Dollars ($5) per hour, which rate may change from time to time
during the Lease Term.

             11.5      Recurrent Utility Use  Landlord may impose a reasonable charge for
any utilities or services, including without limitation electric current,
required to be provided by Landlord by reason of any substantial recurrent use
of the Premises other than during the times provided in Article 11.1 above.

ARTICLE 12

RIGHTS OF LANDLORD

             Landlord
and its agents shall have the right to enter the Premises at all reasonable
times, upon twenty-four (24) hours notice (except no notice shall be required
for entry for janitorial service or in case of emergency), for the purpose of
cleaning the Premises, examining or inspecting the same, serving or posting and
keeping posted thereon notices as provided by law, or which Landlord deems
necessary for the protection of Landlord or the Project, showing the same to
prospective tenants or purchasers of the Project, and for making such
alterations, repairs, improvements or additions to the Premises or to the
Project as Landlord may deem necessary or desirable.  If Tenant shall not be personally present to open and permit an
entry into the Premises at any time when such an entry by Landlord is necessary
or permitted hereunder, Landlord may enter by means of a master key or may
enter forcibly, without liability to Tenant except for any failure to exercise
due care for Tenant’s property, and without affecting this Lease.

ARTICLE
13

INDEMNITY, EXEMPTION OF LANDLORD FROM LIABILITY

             13.1      Indemnity  Tenant shall indemnify, defend and hold
Landlord harmless from and against any and all claims arising from Tenant’s use
of the Premises or from the conduct of its business or from any activity, work
or thing which may be permitted or suffered by Tenant in or about the Premises
or arising out of the use thereof and shall further indemnify, defend and hold
Landlord harmless from and against any and all claims arising from any breach
or default in the performance of any obligation on Tenant’s part to be
performed under this Lease or arising from any negligence of Tenant or any of
its agents, contractors, employees or invitees, patrons, customers or members
and from any and all costs, attorneys’ fees, expenses and liabilities incurred
in the defense of any claim or any action or proceeding brought thereon,
including negotiations in connection therewith; provided, however, the
foregoing indemnity shall not apply to liability to the extent caused by the
gross negligence or willful misconduct of Landlord.  Tenant hereby assumes all risk of damage to property or injury to
persons in or about the Premises from any cause, and Tenant hereby waives all
claims in respect thereof against Landlord.

             13.2      Exemption of
Landlord from Liability  Landlord shall not be liable for injury to Tenant’s business, or
loss of income therefrom, or for damage that may be sustained by the person,
goods, wares, merchandise or property of Tenant, its employees, invitees,
customers, agents, or contractors, or any other person in, on or about the
Premises directly or indirectly caused by or resulting from fire, steam,
electricity, gas, water, or rain which may leak or flow from or into any part
of the Premises, or from the breakage, leakage, obstruction or other defects of
the pipes, sprinklers, wires, appliances, plumbing, air conditioning, light
fixtures, or mechanical or electrical systems, whether such damage or injury
results from conditions arising upon the Premises or upon other portions of the
Building or from other sources or places and regardless of whether the cause of
such damage or injury or the means or repairing the same is inaccessible to
Tenant.  Landlord shall not be liable to
Tenant for any damages arising from any act or neglect of any other tenant of
the Project.

             Tenant
acknowledges that Landlord’s election to provide mechanical surveillance or to
post security personnel in the Building is solely within Landlord’s discretion;
Landlord shall have no liability in connection with the decision whether or not
to provide such services and Tenant hereby waives all claims based
thereon.  Landlord shall not be liable
for losses due to theft, vandalism, or like causes.  Tenant shall defend, indemnify, and hold Landlord harmless from
any such claims made by any employee, licensee, invitee, contractor, agent, or
other person whose presence in, on or about the Premises or the Building is
attendant to the business of Tenant.

ARTICLE 14

INSURANCE

             14.1      Tenant's Insurance  Tenant, shall at all times during the Lease
Term, and at its own cost and expense, procure and continue in force the
following insurance coverage:  (i)
Commercial General Liability Insurance with a combined single limit for bodily
injury and property damage of not less than Three Million Dollars ($3,000,000)
per occurrence and Five Million Dollars ($5,000,000) in the annual aggregate,
including products liability coverage if applicable, covering the use of the
Premises and the performance of Tenant of the indemnity agreements set forth in
Article 13 hereof; (ii) a policy of standard fire, extended coverage and
special extended coverage insurance (all risks), including a vandalism and
malicious mischief endorsement, and sprinkler leakage coverage (Tenant shall
not be required to maintain earthquake coverage with respect to Tenant’s
personal property, furniture and equipment) in an amount equal to the full
replacement value new (or, with respect to Tenant’s personal property,
furniture and equipment, “like-new”) without deduction for depreciation of all
fixtures, furniture, and leasehold improvements installed by or at the expense
of Tenant; and (iii) insurance on all plate or tempered glass in or enclosing
the Premises; for the replacement cost of such glass.

             14.2      Form of Policies  The aforementioned minimum limits of
policies shall in no event limit the liability of Tenant hereunder.  Such insurance shall name Landlord and such
other persons or firms with insurable interests, as Landlord specifies from
time to time, as additional insureds with an appropriate endorsement to the
policy(s) and shall be with companies having a rating of not less than A-VIII
in Best’s Insurance Guide.  Tenant shall
furnish to Landlord, from the insurance companies, or cause the insurance companies
to furnish, certificates of coverage. 
No such policy shall be cancelable or subject to reduction of coverage
or other modification or cancellation except after thirty (30) days prior
written notice to Landlord by the insurer. 
All such policies shall be endorsed to agree that Tenant’s policy is
primary and that any insurance covered by Landlord is excess and not
contributing with any insurance requirement hereunder.  Tenant shall, at least twenty (20) days
prior to the expiration of such policies, furnish Landlord with renewals or
binders.  Tenant agrees that if Tenant
does not take out and maintain such insurance or furnish Landlord with renewals
or binders, Landlord may (but shall not be required to) procure said insurance
on Tenant’s behalf and charge Tenant the cost thereof, which amount shall be
payable by Tenant upon demand with interest from the date such sums are
expended.

             Additionally,
Tenant shall maintain Worker’s Compensation required by law and shall provide
Landlord with evidence of coverage. 
Said evidence shall be in the form of a certificate of insurance and
shall provide for Landlord to receive thirty (30) days notice of cancellation
from the insurer.

             14.3      Landlord's Insurance  Landlord shall, at Landlord’s expense,
procure and maintain at all times during the Lease Term, a policy or policies
of insurance covering loss or damage to the Building in the amount of the full
replacement cost new without deduction for depreciation thereof (exclusive of
Tenant’s trade fixtures, inventory, personal property and equipment), providing
protection against all perils included within the classification of fire and
extended coverage, vandalism coverage and malicious mischief, sprinkler
leakage, water damage, and special extended coverage on building.  Additionally, Landlord may (but shall not be
required to) carry:  (i) Bodily Injury
and Property Damage Liability Insurance and/or Excess Liability Coverage
Insurance; (ii)

 Earthquake and/or Flood Damage
Insurance; or (iii) Rental Income Insurance at its election or if required by
its lender from time to time during the term hereof, in such amounts and with
such limits as Landlord or its lender may deem appropriate.  The costs of all such insurance shall be
included in Insurance Costs.

             14.4      Waiver of Subrogation  The parties release each other and their
respective authorized representatives from any claims for damage to the
Premises, and to the fixtures, personal property, improvements, and alterations
of either Landlord or Tenant, in or on the Premises, Building or Project, that
are caused by or result from risks insured against under any insurance policies
carried by the parties and in force at the time of any such damage.  Any policy or policies of fire, extended or
similar casualty insurance which either party obtains in connection with the
Premises shall include a clause or endorsement denying the insurer any rights
of subrogation against the other party to the extent any rights have been
waived by the insured prior to the occurrence of injury of loss.

             14.5      Compliance with Law.  Tenant agrees that it will not, at any time,
during the Lease Term, carry any stock of goods or do anything in or about the
Premises that will in any way tend to increase the insurance rates upon the
Building.  Tenant agrees to pay Landlord
forthwith upon demand the amount of any increase in premiums for insurance
against loss by fire that may be charged during the Lease Term on the amount of
insurance to be carried by Landlord on the Building resulting directly from the
foregoing, or from Tenant doing any act in or about said Premises that does so
increase the insurance rates, whether or not Landlord shall have consented to
such act on the part of Tenant.  If
Tenant installs upon the Premises any electrical equipment which constitutes an
overload of electrical lines of the Premises, Tenant shall at its own expense
make whatever changes are necessary to comply with requirements of the
insurance underwriters and any governmental authority having jurisdiction
thereover, but nothing herein contained shall be deemed to constitute
Landlord’s consent to such overloading. 
Tenant shall, at its own expense, comply with all requirements of the
insurance authority having jurisdiction over the Project necessary for the
maintenance of reasonable fire and extended coverage insurance for the
Premises, including without limitation thereto, the installation of fire
extinguishers or an automatic dry chemical extinguishing system.

ARTICLE 15

ASSIGNMENT AND SUBLETTING

             Except
as provided in Articles 15(g) and 15(h) below, Tenant shall not and have no
power to, either voluntarily or by operation of law, sell, assign, transfer or
hypothecate this Lease, or sublet the Premises or any part thereof, or permit
the Premises or any part thereof to be occupied by anyone other than Tenant or
Tenant’s employees without the prior written consent of Landlord, which consent
shall not be unreasonably withheld, subject to compliance with this Article
15.  If Tenant is a corporation, limited
liability company, unincorporated association or partnership, the sale,
assignment, transfer or hypothecation of any stock, membership or other
ownership interest in such corporation, limited liability company, association
or partnership in the aggregate of fifty percent (50%) or more shall be deemed
a prohibited assignment within the meaning and provisions of this Article
15.  Tenant may transfer its interest
pursuant to this Lease upon the following express conditions:

             (a)         That the proposed transferee shall be subject to the prior
written consent of Landlord, which consent shall not be unreasonably withheld;
provided, however, without limiting the generality of the foregoing, it shall
be reasonable for Landlord to deny such consent if any of the following are
applicable:

                         (i)         The use to be made of Premises by the proposed
transferee is (a) not generally consistent with the character and nature of all
other tenancies in the Building or Project, or (b) a use which conflicts with
any so-called “exclusive” then in favor of, or for any use which is the same as
that stated in any percentage lease to, another tenant of the Building or
Project, or (c) a use which would be prohibited by any other portion of this
Lease (including but not limited to any Rules and Regulations then in effect);

                         (ii)        The character, reputation or financial
responsibility of the proposed transferee is not reasonably satisfactory to
Landlord or in any event not at least equal to those which were possessed by
Tenant as of the date of execution of this Lease;

                         (iii)       The transferee is either a governmental
agency or instrumentality thereof;

                         (iv)      The proposed transfer would cause Landlord
to be in violation of another lease or agreement to which Landlord is a party,
or would give an occupant of the Building a right to cancel its lease;

                         (v)       The terms of the proposed transfer will
allow the transferee to exercise a right of renewal, right of expansion, right
of first offer, or other similar right held by Tenant (or will allow the
transferee to occupy space leased by Tenant pursuant to any such right); or

                         (vi)      Either the proposed transferee, or any
person or entity which directly or indirectly, controls, is controlled by, or
is under common control with, the proposed transferee, (i) occupies space in
the Project at the time of the request for consent, (ii) is negotiating with
Landlord to lease space in the Project at such time, or (iii) has negotiated
with Landlord during the six (6) month period immediately preceding the request
for consent notice from Tenant.

            (b)       That
Tenant shall pay Landlord’s standard processing fee (currently Five Hundred
Dollars ($500), which fee may change from time to time during the Lease Term)
and attorneys’ fees incurred in connection with the review of the request for
consent to transfer, regardless of whether Landlord consents thereto;

            (c)        That
the proposed transferee shall execute an agreement pursuant to which it shall
agree to perform faithfully and be bound by all of the terms, covenants,
conditions, provisions and agreements of this Lease;

            (d)       That an executed duplicate original of said assignment and
assumption agreement or other transfer on Landlord’s then standard form, shall
be delivered to Landlord within five (5) days after the execution thereof.  Such transfer shall not be binding upon
Landlord until the delivery thereof to Landlord and the execution and delivery
of Landlord’s consent thereto.  It shall
be a condition to Landlord’s consent to any subleasing, assignment or other
transfer of part or all of Tenant’s interest in the Premises (hereinafter
referred to as a “Transfer”) that (i) Tenant shall be required to pay
Landlord’s reasonable attorneys’ fees and other costs incurred in connection
with the review and execution thereof; (ii) upon Landlord’s consent to any
Transfer, Tenant shall pay and continue to pay as Additional Rent to Landlord
over the term of such Transfer fifty percent (50%) of any sums or other
economic consideration received by Tenant as a result of such Transfer, whether
denominated rentals or otherwise which exceed (a) the costs of all tenant
improvements made by Tenant for the transferee and amount of all tenant
improvement allowances actually provided to and used by the transferee
(amortized over the term of the Transfer); (b) the amount of brokerage fees
actually paid by Tenant in connection with the Transfer (amortized over the
term of the Transfer); and (c) the sums which Tenant is obligated to pay
Landlord under this Lease; (iii) any sublessee of part or all of Tenant’s
interest in the Premises shall agree that in the event Landlord gives such
sublessee notice that Tenant is in default under this Lease, such sublessee
shall thereafter make all sublease or other payments directly to Landlord,
which will be received by Landlord without any liability whether to honor the
sublease or otherwise (except to credit such payments against sums due under
this Lease), and any sublessee shall agree to attorn to Landlord or its
successors and assigns at their request should this Lease be terminated for any
reason, except that in no event shall Landlord or its successors or assigns be
obligated to accept such attornment; (iv) any such Transfer and consent shall
be effected on forms supplied or approved by Landlord and/or its legal counsel;
(v) Landlord may require that an Event of Default not then exist hereunder; and
(vi) Tenant or the proposed subtenant or assignee shall agree to pay Landlord,
upon demand, as additional rent, a sum equal to the additional costs, if any,
incurred by Landlord for maintenance and repair as a result of any change in
the nature of occupancy caused by such subletting or assignment.  If Landlord consents to a requested
assignment or sublease, Tenant hereby agrees that (i) it shall thereupon be
deemed, automatically and irrevocably to have assigned to Landlord as
additional security for the performance and observance of Tenant’s obligations
and covenants under this Lease, all rent or other sums received or to be
received by Tenant in connection therewith and (ii) Landlord as assignee and as
attorney-in-fact of Tenant, or a receiver for Tenant whether or not appointed
on Landlord’s application, may collect such rent or other sums and apply the
same toward Tenant’s obligations under this Lease.  Such power of attorney is a right coupled with an interest and is
irrevocable.  Notwithstanding the
foregoing, Tenant shall have the right to collect such rent and other sums
unless and until Tenant commits any act of default hereunder.  Tenant hereby agrees and acknowledges that
the above conditions imposed upon the granting of Landlord’s consent to any
proposed Transfer by Tenant are reasonable. 
If Tenant notifies Landlord of its desire to assign this Lease or any
interest herein, to sublet all or any part of the Premises for more than fifty
percent (50%) of the remainder of the Lease Term, or to sublet more than fifty
percent (50%) of the Premises for any period, then in lieu of giving consent
thereto, Landlord may, at Landlord’s option, elect to terminate this Lease as
to the portion of the Premises to be sublet or assigned as of the proposed
effective date of any proposed assignment or any such subletting.  Any sale, assignment, hypothecation,
transfer or subletting of this Lease which is not in compliance with the
provisions of this Article 15 shall be void and shall be an Event of Default
hereunder.  In no event shall the
consent by Landlord to an assignment or subletting be construed as relieving
Tenant, any assignee, or sublessee from obtaining the express written consent
of Landlord to any further assignment or subletting or as releasing Tenant from
any liability or obligation hereunder whether or not then accrued and Tenant
shall continue to be fully liable therefor. 
No collection or acceptance of rent by Landlord from any person other
than Tenant shall be deemed a waiver of any provision of this Article 15 or the
acceptance of any assignee or subtenant hereunder, or a release of Tenant (or
of any successor of Tenant or any subtenant holding theretofore or thereafter
accruing);

                         (e)            Tenant shall not enter into any
sublease or assignment in which any of the following is applicable:

                                        (i)          The determination of the amount of
rent is expressed in whole or in part as a percentage of the income or profits
derived by the tenant or subtenant or assignee from the space leased (other
than an amount based on a fixed percentage or percentages of gross receipts or
gross sales);

                                        (ii)         More than ten percent (10%) of rent is
expressly attributable to personal property, determined at the time the
personal property is placed in service and by reference to relative fair market
values of the personal and other property of the tenant, subtenant or assignee
(and not by reference to any allocation contained in the sublease or assignment
documents); or

                                        (iii)        Services are expressly required to be
rendered to a tenant or occupant unrelated to subtenant’s or assignee’s use of
the space and primarily for its convenience and which are other than those
usually or customarily rendered in connection with the rental of space for
occupancy only; and

                           (f)         In any sublease or assignment in which
the amount of rent is determined in whole or in part by reference to the gross
sales or receipts of the subtenant or assignee such sublease or assignment
shall contain a provision which prohibits subleasing or assigning or if
subleasing or assigning is permitted it shall prohibit the tenant or any
successor in interest from subleasing all or any portion of its leasehold
interest for an amount of rent determined in whole or in part from the income
or profits derived by any person from such interest (other than an amount based
in a fixed percentage or percentages of receipts or sales).

                           (g)        Notwithstanding anything contained in
this Article 15, so long as no Event of Default by Tenant then exists under
this Lease, and En Pointe Technologies, Inc., a Delaware corporation (“EPT”),
is the Tenant hereunder, and subject to the satisfaction of the conditions set
forth in this Article 15(g), Tenant shall have the right to assign this
Lease or sublet all or a portion of the Premises to an Affiliate of EPT at any
time, without the prior written consent of Landlord but otherwise subject to
all of the terms of this Article 15  except for Article 15(d)(ii) and except that Landlord shall not
have any recapture right with respect to such assignment or subletting.  Notwithstanding the foregoing, such
assignment or sublease shall not be effective until Tenant has given Landlord
all of the following at least thirty (30) days prior to the effective date of
such assignment or sublease; (i) written notice of such assignment or sublease,
(ii) the identity of the assignee or subtenant, (iii) an executed copy of the
assignment or sublease (which shall include an undertaking by the assignee or
subtenant to assume, perform and be bound by all of the obligations of Tenant
under this Lease with respect to the portion of the Premises assigned or
subleased and which shall specify that such assignment or sublease is not
effective until the conditions in this Article 15(g) have been satisfied),
and (iv) such financial information with respect to the assignee or subtenant
as Landlord may reasonably request.  In
no event shall such assignment or subletting release EPT as Tenant from its
primary liability under this Lease.  As
used herein, “Affiliate” shall mean any entity controlling, controlled by or
under common control with EPT.  The
term “control” shall mean the ownership of fifty-one percent (51%) or more of
the ownership and/or economic interest of an entity.  The rights granted to EPT
hereunder to assign or sublet the Premises to an Affiliate of EPT may not be
transferred or assigned to any third party. 
Any additional assignment or subletting by Tenant’s Affiliates shall be
subject to all of the terms and conditions of this Article 15.

                           (h)        Notwithstanding anything to the contrary
contained in this Article 15, so long as no Event of Default by Tenant then
exists under this Lease and EPT is the Tenant hereunder, and subject to the
satisfaction of the conditions set forth in this Article 15(h), Tenant shall have
the right to assign this Lease without Landlord’s consent to any entity
resulting from a merger or consolidation of EPT with another entity or the
acquisition by another entity of all or substantially all of the assets of EPT,
provided:  (i) such entity
has a net worth immediately after such merger, consolidation or acquisition of
at least Fifty Million Dollars ($50,000,000.00); (ii) Tenant gives Landlord at
least thirty (30) days’ prior written notice of such transfer identifying the
surviving entity of such merger or consolidation, or the entity acquiring all
or substantially all of the assets of EPT, as applicable; (iii) Tenant provides
Landlord with such financial information as Landlord may reasonably require to
verify that the applicable assignee satisfies the net worth requirement set
forth herein; and (iv) in the case of any transfer of all or substantially all
of the assets of Tenant to another entity, the transferee promptly executes and
delivers to Landlord an assumption of all of Tenant’s obligations under this
Lease.  Notwithstanding any assignment
of the Lease pursuant to this Article 15(h), all of the terms of the Lease
shall remain in full force and effect and EPT shall not be released from its
obligations and primary liability under this Lease.  The rights granted to EPT
under this Article 15(h) are personal to EPT and may not be transferred or
assigned to any third party.

ARTICLE 16

DAMAGE OR DESTRUCTION

             Except
as provided in Article 9, if the Project is damaged by fire or other insured
casualty and the insurance proceeds have been made available therefor by the
holder or holders of any mortgages or deeds of trust covering the Premises or
the Project, the damage shall be repaired by and at the expense of the Landlord
to the extent such insurance proceeds are available therefor and provided such
repairs can, in Landlord’s reasonable opinion, be made within ninety (90) days
after the occurrence of such damage without the payment of overtime or other
premiums, and until such repairs are completed rent shall be abated in
proportion to the part of the Premises which is unusable by Tenant in the
conduct of its business (but there shall be no abatement of rent by reason of
any portion of the Premises being unusable for a period equal to one (1) day or
less).  If the damage is due to the
fault or neglect of Tenant or its employees, agents or visitors, there shall be
no abatement of rent.  If repairs
cannot, in Landlord’s reasonable opinion, be made within ninety (90) days after
the occurrence of the damage, Landlord may, at its option, make them within a
reasonable time and in such event this Lease shall continue in effect and the
rent shall be abated in the manner provided in this Article 16.  Landlord’s election to make such repairs
must be evidenced by written notice to Tenant within thirty (30) days after the
learning of the occurrence of the damage. 
If Landlord does not so elect within such thirty (30) day period to make
such repairs which cannot be made within ninety (90) days, then either party may,
by written notice to the other, cancel this Lease as of the date of the
occurrence of such damage.  A total
destruction of the Project shall automatically terminate this Lease.  Except as provided in this Article, there
shall be no abatement of rent and no liability of Landlord by reason of any
injury to or interference with Tenant’s business or property arising from such
damage or destruction or the making of any repairs, alterations or improvements
in or to any portion of the Project or the Premises or in or to fixtures,
appurtenances and equipment therein. 
Tenant understands that Landlord will not carry insurance of any kind
for Tenant’s furniture, furnishings, fixtures or equipment, and that Landlord
shall not be obligated to repair any damage thereto or replace the same.  With respect to any damage which Landlord is
obligated to repair or elects to repair, Tenant, as a material inducement to
Landlord entering into this Lease, irrevocably waives and releases its rights
under the provisions of Sections 1932(2) and 1933(4) of the California Civil
Code.

ARTICLE 17

SUBORDINATION

             As
of the date of this Lease, the Project is not encumbered by any ground lease,
mortgage or deed of trust.  Landlord
shall have the right to cause this Lease to be and become and remain subject
and subordinate to any and all ground or underlying leases, mortgages or deeds
of trust which may hereafter be executed covering the Premises or the Project
or any renewals, modifications, consolidations, replacements or extensions thereof,
for the full amount of all advances made or to be made thereunder and without
regard to the time or character of such advances, together with interest
thereon and subject to all the terms and provisions thereof; provided, however,
that any such ground lessor, beneficiary or mortgagee agrees in its standard
institutional subordination, non-disturbance and attornment agreement (“SNDA”)
not to disturb Tenant as long as Tenant is not in default under this
Lease.  The SNDA shall provide, without
limitation, that such ground lessor, beneficiary or mortgagee shall not
(i) be bound by any payment of rent or additional rent for more than one
(1) month in advance, except advance rental payments expressly provided in this
Lease; (ii) be liable for any act or omission of Landlord; or
(iii) be subject to any offset or defense arising prior to the date such
ground lessor terminates Landlord’s leasehold estate or such mortgagee or
beneficiary acquires title to the Project as applicable.  Tenant agrees to execute and deliver to
Landlord the SNDA from Landlord’s ground lessor, beneficiary or mortgagee
within ten (10) days after receipt thereof from Landlord.  If any such mortgagee or beneficiary elects
to make this Lease superior to such mortgage or deed of trust, Tenant shall,
within ten (10) days after Landlord’s request, execute any certificate or
instrument confirming the same.  In the
event of the enforcement by the mortgagee or beneficiary under any such
mortgage or deed of trust of the remedies provided for by law or by such
mortgage or deed of trust, Tenant will, at the option of any person or party
succeeding to the interest of Landlord as a result of such enforcement, attorn
to and automatically become the Tenant of such successor-in-interest without
change in the terms or other provisions of this Lease; provided, however, that
such successor-in-interest shall not be bound by (a) any payment of rent or
additional rent for more than one (1) month in advance, except advance rental
payments expressly provided for in this Lease; (b) any modification to this
Lease made without the written consent of such mortgagee or beneficiary or such
successor-in-interest; (c) liable for any act or omission of Landlord; or (d)
subject to any offset or defense arising prior to the date such
successor-in-interest acquired title to the Project or Building.  Upon request by any mortgagee or
beneficiary, Tenant shall execute and deliver an instrument or instruments
confirming the attornment provided for herein.

ARTICLE 18

EMINENT DOMAIN

             If
the whole of the Premises or so much thereof as to render the balance unusable
by Tenant shall be taken under power of eminent domain, or is sold, transferred
or conveyed in lieu thereof, this Lease shall automatically terminate as of the
date of such condemnation, or as of the date possession is taken by the
condemning authority, at Landlord’s option. 
No award for any partial or entire taking shall be apportioned, and
Tenant hereby assigns to Landlord any award which may be made in such taking or
condemnation, together with any and all rights of Tenant now or hereafter
arising in or to the same or any part thereof; provided, however, that nothing
contained herein shall be deemed to give Landlord any interest in or to require
Tenant to assign to Landlord any award made to Tenant for the taking of
personal property and fixtures belonging to Tenant and removable by Tenant at
the expiration of the term hereof as provided hereunder or for loss of goodwill
or the interruption of, or damage to, Tenant’s business.  In the event of a partial taking, or a sale,
transfer or conveyance in lieu thereof, which does not result in a termination
of this Lease, the rent shall be apportioned according to the ratio that the
part of the Premises remaining useable by Tenant bears to the total area of the
Premises.

ARTICLE 19

DEFAULT

             Each
of the following acts or omissions of Tenant or of any guarantor of Tenant’s
performance hereunder, or occurrences, shall constitute an “Event of Default”:

                           (a)         Failure or refusal to pay Basic Rental,
Additional Rent or any other amount provided hereunder within five (5) calendar
days after the date of Tenant’s receipt of written notice from Landlord that
the same is delinquent; provided, however, that if Landlord gives Tenant
written notice of Tenant’s failure to pay Basic Rental, Additional Rent or any
other amount provided hereunder once in any calendar year, then no further
notice of any delinquency by Tenant in making any such payment shall be
required for the balance of such calendar year and Tenant’s failure to pay
Basic Rental, Additional Rent or any other sum due under this Lease within five
(5) calendar days after the same becomes due or payable during the remainder of
such calendar year shall be an Event of Default;

                           (b)        Failure to perform or observe any other
covenant or condition of this Lease to be performed or observed within thirty
(30) days following written notice to Tenant of such failure;

                           (c)         Abandonment or vacating or failure to
accept tender of possession of the Premises or any significant portion thereof;

                           (d)        The taking in execution or by similar
process or law (other than by eminent domain) of the estate hereby created;

                           (e)         To the extent permitted by law, the
filing by Tenant or any guarantor hereunder in any court pursuant to any
statute of a petition in bankruptcy or insolvency or for reorganization or
arrangement of for the appointment of a receiver of all or a portion of
Tenant’s property; the filing against Tenant or any guarantor hereunder of any
such petition, or the commencement of a proceeding for the appointment of a
trustee, receiver or liquidator for Tenant, or for any guarantor hereunder, or
of any of the property of either, or a proceeding by any governmental authority
for the dissolution or liquidation of Tenant or any guarantor hereunder, if
such proceeding shall not be dismissed or trusteeship discontinued within sixty
(60) days after commencement of such proceeding or the appointment of such
trustee or receiver; or the making by Tenant or any guarantor hereunder of an
assignment for the benefit of creditors. 
Tenant hereby stipulates to the lifting of the automatic stay in effect
and relief from such stay for Landlord in the event Tenant files a petition
under the United States Bankruptcy laws, for the purpose of Landlord pursuing
its rights and remedies against Tenant and/or a guarantor of this Lease;

                           (f)         Tenant’s failure to cause to be
released any mechanics liens filed against the Premises or the Project within
twenty (20) days after the date the same shall have been filed or recorded; and

                           (g)        The occurrence of any event defined
elsewhere in this Lease as an Event of Default.

ARTICLE 20

REMEDIES

                           (a)         In the event of a breach of or default
under this Lease as provided in Article 19 hereof, Landlord may exercise all of
its remedies as may be permitted by law, including but not limited to the
remedy provided by Section 1951.4 of the California Civil Code, and including,
terminating this Lease, reentering the Premises and removing all persons and
property therefrom, which property may be stored by Landlord at a warehouse or
elsewhere at the risk, expense and for the account of Tenant.  If Landlord elects to terminate this Lease,
Landlord shall be entitled to recover from Tenant the aggregate of all amounts
permitted by law, including but not limited to, the cost of recovering the
Premises and including (i) the worth at the time of award of the unpaid rent
which had been earned at the time of termination; (ii) the worth at the time of
award of the amount by which the unpaid rent which would have been earned after
termination until the time of award exceeds the amount of such rental loss that
Tenant proves could have been reasonably avoided; (iii) the worth at the time
of the award of the amount by which the unpaid rent for the balance of the term
after the time of award exceeds the amount of such rental loss that Tenant
proves could be reasonably avoided; and (iv) any other amount necessary to
compensate Landlord for all the detriment proximately caused by Tenant’s
failure to perform its obligations under this Lease or which in the ordinary
course of events would be likely to result therefrom.  The “worth at the time of award” of the amounts referred to in
(i) and (ii) above is computed by allowing interest at the rate of ten percent
(10%) per annum.  The “worth at the time
of award” of the amount referred to in (iii) above shall be computed by
discounting such amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of award plus one percent (1%).  Further, Tenant shall be liable for all leasing commissions paid
by or owing by Landlord arising from this Lease and any extensions thereof.

                           (b)        Nothing in this Article 20 shall be
deemed to affect Landlord’s right to indemnification for liability or
liabilities arising prior to the termination of this Lease for personal
injuries or property damage under the indemnification clause or clauses
contained in this Lease.

                           (c)         Notwithstanding anything to the
contrary set forth herein, Landlord’s re-entry to perform acts of maintenance
or preservation of or in connection with efforts to relet the Premises or any
portion thereof, or the appointment of a receiver upon Landlord’s initiative to
protect Landlord’s interest under this Lease shall not terminate Tenant’s right
to possession of the Premises or any portion thereof and, until Landlord does
elect to terminate this Lease, this Lease shall continue in full force and
effect and Landlord shall enforce all of Landlord’s rights and remedies hereunder
including, without limitation, the right to recover from Tenant as it becomes
due hereunder all Basic Rental, Additional Rent and other charges required to
be paid by Tenant under the terms hereof.

                           (d)        All rights, powers and remedies of
Landlord hereunder and under any other agreement now or hereafter in force
between Landlord and Tenant shall be cumulative and not alternative and shall
be in addition to all rights, powers and remedies given to Landlord by law, and
the exercise of one or more rights or remedies shall not impair Landlord’s
right to exercise any other right or remedy.

                           (e)         Any amount due from Tenant to Landlord
hereunder which is not paid when due shall bear interest at the lower of
eighteen percent (18%) per annum or the maximum lawful rate of interest from
the due date until paid, unless otherwise specifically provided herein, but the
payment of such interest shall not excuse or cure any default by Tenant under
this Lease.  In addition to such
interest:  (a) if Basic Rental is not paid
within five (5) days after the same is due, a late charge equal to one and one
half percent (1 1/2%) of the amount overdue or One Hundred Dollars ($100),
whichever is greater, shall be assessed and shall accrue for each calendar
month or part thereof until such rental, including the late charge, is paid in
full, which late charge Tenant hereby agrees is a reasonable estimate of the
damages Landlord shall suffer as a result of Tenant’s late payment and (b) an
additional charge of Twenty-five Dollars ($25) shall be assessed for any check
given to Landlord by or on behalf of Tenant which is not honored by the drawee
thereof; which damages include Landlord’s additional administrative and other
costs associated with such late payment and unsatisfied checks and the parties
agree that it would be impracticable or extremely difficult to fix Landlord’s
actual damage in such event.  Such
charges for interest and late payments and unsatisfied checks are separate and
cumulative and are in addition to and shall not diminish or represent a
substitute for any or all of Landlord’s rights or remedies under any other
provision of this Lease.

                           (f)         Tenant shall be liable for any other
amount necessary to compensate Landlord for all the detriment proximately
caused by Tenant’s failure to perform its obligations under this Lease, or
which in the ordinary course of things would be likely to result therefrom.

ARTICLE
21

TRANSFER OF LANDLORD'S INTEREST

             Landlord
shall have the right to transfer and assign, in whole or in part, all its
rights and obligations hereunder and in the Project and any other property
referred to herein, and in such event and upon such transfer (any such
transferee to have the benefit of, and be subject to, the rights and
obligations of Landlord hereunder), Landlord shall be released from any further
obligations hereunder and Tenant agrees to look solely to such
successor-in-interest of Landlord for the performance of such obligations.

ARTICLE 22

BROKERS

             Each
party represents and warrants to the other party that it has not had dealings
in any manner with any real estate broker, finder or other person with respect
to the Premises and the negotiation and execution of this Lease except CB
Richard Ellis, Inc. and The Seeley Company. 
Except as to commissions and fees to be paid as provided in this Article
22, Tenant shall indemnify, defend and hold harmless Landlord from all damage,
loss, liability and expense (including attorneys’ fees and related costs)
arising out of or resulting from any claims for commissions or fees that may or
have been asserted against Landlord by any broker, finder or other person with
whom Tenant has or purportedly has dealt with in connection with the Premises
and the negotiation and execution of this Lease.  Landlord shall pay broker leasing commissions to CB Richard
Ellis, Inc. in connection with the negotiation and execution of this Lease
pursuant to a separate agreement, and CB Richard Ellis, Inc. shall pay The
Seeley Company a portion of such broker leasing commissions.  Landlord and Tenant agree that Landlord
shall not be obligated to pay any broker leasing commissions, consulting fees,
finder fees or any other fees or commissions arising out of or relating to any
extended term of this Lease or to any expansion or relocation of the Premises
at any time.

ARTICLE 23

PARKING

             Tenant
shall be entitled to use of the number of unreserved parking spaces set forth
in Article 1.9 of Basic Lease Provisions. 
Tenant shall pay the prevailing monthly parking charges for the use of
such unreserved parking spaces, which rates may change from time to time during
the Lease Term.  As of the date of this
Lease, the prevailing monthly parking charge for unreserved parking spaces is
Fifty Five Dollars ($55) per month. 
Such parking shall be available upon reasonable terms and conditions to
be established from time to time by Landlord or Landlord’s operator of such
parking facilities.  Tenant agrees not
to overburden the parking facility and agrees to cooperate with Landlord’s
other tenants in the use of the parking facilities.  Landlord reserves the right to determine, in its reasonable
discretion, whether the parking facilities are becoming overburdened and
allocate assigned parking spaces among Tenant and the other tenants.  All visitor parking shall be in parking
areas designated by Landlord upon terms and conditions to be established from
time to time by Landlord or Landlord’s operator of such parking facilities.

ARTICLE 24

WAIVER

             No
waiver by Landlord of any provision of this Lease shall be deemed to be a
waiver of any other provision hereof or of any subsequent breach by Tenant of
the same or any other provision.  No
provision of this Lease may be waived, except by an instrument in writing
executed by the waiving party. 
Landlord’s consent to or approval of any act by Tenant requiring
Landlord’s consent or approval shall not be deemed to render unnecessary the
obtaining of Landlord’s consent to or approval of any subsequent act of Tenant,
whether or not similar to the act so consented to or approved.  No act or thing done by Landlord or
Landlord’s agents during the term of this Lease shall be deemed an acceptance
of a surrender of the Premises, and no agreement to accept such surrender shall
be valid unless in writing and signed by Landlord.  Any payment by Tenant or receipt by Landlord of an amount less
than the total amount then due hereunder shall be deemed to be in partial
payment only thereof and not a waiver of the balance due or an accord and
satisfaction, notwithstanding any statement or endorsement to the contrary on
any check or any other instrument delivered concurrently therewith or in
reference thereto.  Accordingly Landlord
may accept any such amount and negotiate any such check without prejudice to Landlord’s
right to recover all balances due and owing and to pursue its other rights
against Tenant under this Lease, regardless of whether Landlord makes any
notation on such instrument of payment or otherwise notifies Tenant that such
acceptance or negotiation is without prejudice to Landlord’s rights.

ARTICLE 25

ESTOPPEL CERTIFICATE

             Tenant
shall, at any time and from time to time, upon not less than ten (10) days’
prior written notice from Landlord, execute, acknowledge and deliver to
Landlord a statement in writing certifying the following information, (but not
limited to the following information in the event further information is
requested by Landlord): (i) 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 modified, is in full force and effect); (ii) the dates to
which the rental and other charges are paid in advance, if any; (iii) the
amount of Tenant’s Security Deposit, if any; (iv) acknowledging that there are
not, to Tenant’s knowledge, any uncured defaults on the part of Landlord
hereunder, and no events or conditions then in existence which, with the
passage of time or notice or both, would constitute a default on the part of
Landlord hereunder, or specifying such defaults, events or conditions, if any
are claimed; and (v) such other information regarding the Lease as may be
requested by Landlord.  It is expressly
understood and agreed that any such statement may be relied upon by any
prospective purchaser or encumbrancer of all or any portion of the Real
Property.  Tenant’s failure upon
Landlord’s reasonable request to deliver such statement within such time shall,
at the option of Landlord, constitute an Event of Default under this Lease.  Furthermore, Tenant’s failure to deliver
such statement within such time shall constitute an admission by Tenant that
all statements contained therein are true and correct.  Tenant agrees to execute all documents
required in accordance with this Article 25 within ten (10) days after delivery
of said documents.

ARTICLE 26

LIABILITY OF LANDLORD

             The
liability of Landlord, any agent of Landlord, or any of the respective
officers, directors, shareholders, or employees to Tenant for or in respect of
any default by Landlord under the terms of this Lease or in respect of any
other claim or cause of action shall be limited to the interest of Landlord in
the Project.  Tenant agrees to look
solely to Landlord’s interest in the Project for the recovery and satisfaction
of any judgment against Landlord, and any agent of the Landlord, or any of
their respective officers, directors, shareholders and employees.

ARTICLE 27

INABILITY TO PERFORM

             This
Lease and the obligations of Tenant hereunder shall not be affected or impaired
because Landlord is unable to fulfill any of its obligations hereunder or is
delayed in doing so, if such inability or delay is caused by reason of
unavailability of materials, strike or other labor troubles or any other cause
previously or at such time beyond the reasonable control of anticipation of
Landlord.

ARTICLE 28

HAZARDOUS MATERIALS

             28.1      Environmental Law
Compliance  During the term of
this Lease, Tenant shall comply with all Environmental Laws and Environmental
Permits (each as defined in Article 28.4 hereof) applicable to the operation or
use of the Premises, will cause all other persons occupying or using the
Premises to comply with all such Environmental Laws and Environmental Permits,
and will immediately pay or cause to be paid all costs and expenses incurred by
reason of such compliance.

             28.2      Prohibition  Tenant shall not generate, use, treat,
store, handle, release or dispose of, or permit the generation, use, treatment,
storage, handling, release or disposal of Hazardous Materials (as defined in
Article 28.4 hereof) on the Premises, or the Project, or transport or permit
the transportation of Hazardous Materials to or from the Premises or the
Project except for limited quantities used or stored at the Premises and
required in connection with the routine operation and maintenance of the
Premises, and then only upon the written consent of Landlord and in compliance
with all applicable Environmental Laws and Environmental Permits.

             28.3      Indemnity  Tenant agrees to defend, indemnify and hold
harmless Landlord from and against all obligations (including removal and
remedial actions), losses, claims, suits, judgments, liabilities, penalties,
damages (including consequential and punitive damages), costs and expenses
(including attorneys’ and consultants’ fees and expenses) of any kind or nature
whatsoever that may at any time be incurred by, imposed on or asserted against
Landlord directly or indirectly based on, or arising or resulting from (a) the
actual or alleged presence of Hazardous Materials on the Project which is
caused or permitted by Tenant and (b) any Environmental Claim relating in any
way to Tenant’s operation or use of the Premises (the “Hazardous Materials
Indemnified Matters”).  The provisions
of this Article 28 shall survive the expiration or sooner termination of this
Lease.

             28.4      Definitions  As used herein, the following terms shall
have the following meanings:  “Hazardous
Materials” means (i) petroleum or petroleum products, natural or synthetic gas,
asbestos in any form that is or could become friable, urea formaldehyde foam
insulation, and radon gas; (ii) any substances defined as or included in the
definition of “hazardous substances,” “hazardous wastes,” “hazardous
materials,” “extremely hazardous wastes,” “restricted hazardous wastes,” “toxic
substances,” “toxic pollutants,” “contaminants” or “pollutants,” or words of
similar import, under any applicable Environmental Law; and (iii) any other
substance exposure to which is regulated by any governmental authority.  “Environmental Law(s)” means any federal,
state or local statute, law, rule, regulation, ordinance, code, policy or rule
of common law now or hereafter in effect and in each case as amended, and any
judicial or administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment, relating to the environment,
health, safety or Hazardous Materials, including without limitation, the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
42 U.S.C. §§ 9601 et seq.; the Resource Conservation and Recovery Act, 42
U.S.C. §§ 6901 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C.
§§ 1801 et seq.; the Clean Water Act, 33 U.S.C. §§ 1251 et seq.; the Toxic
Substances Control Act, 15 U.S.C. §§ 2601 et seq.; the Clean Air Act, 42 U.S.C.
§§ 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. §§ 300f et seq.; the
Atomic Energy Act, 42 U.S.C. §§ 2011 et seq.; the Federal Insecticide,
Fungicide and Rodenticide Act, 7 U.S.C. §§ 136 et seq.; the Occupational Safety
and Health Act, 29 U.S.C. §§ 651 et seq. 
“Environmental Claims” means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of
non-compliance or violation, investigations, proceedings, consent orders or
consent agreements relating in any way to any Environmental Law or any
Environmental Permit, including without limitation (i) any and all
Environmental Claims by governmental or regulatory authorities for enforcement,
cleanup, removal, response, remedial or other actions or damages pursuant to
any applicable Environmental Law and (ii) any and all Environmental Claims by
any third party seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to health, safety or the
environment.  “Environmental Permits”
means all permits, approvals, identification numbers, licenses and other
authorizations required under any applicable Environmental Law.

ARTICLE
29

SURRENDER OF PREMISES; REMOVAL OF PROPERTY

             29.1      No Merger.  The voluntary or other surrender of this
Lease by Tenant to Landlord, or a mutual termination hereof, shall not work a
merger, and shall at the option of Landlord, operate as an assignment to it of
any or all subleases or subtenancies affecting the Premises.

             29.2      Surrender.  Upon the expiration of the Lease Term, or
upon any earlier termination of this Lease, Tenant shall quit and surrender
possession of the Premises to Landlord in as good order and condition as the
same are now and hereafter may be improved by Landlord or Tenant, reasonable
wear and tear and repairs (including those necessitated by damage from casualty
or condemnation) which are Landlord’s obligation excepted, and shall, without
expense to Landlord, remove or cause to be removed from the Premises all debris
and rubbish, all furniture, equipment, business and trade fixtures, including,
without limitation the Existing Furniture, free-standing cabinet work, moveable
partitioning and other articles of personal property owned by Tenant or
installed or placed by Tenant at its own expense in the Premises, and all
similar articles of any other persons claiming under Tenant unless Landlord
exercises its option to have any subleases or subtenancies assigned to it, and
Tenant shall repair all damage to the Premises resulting from the installation
and removal of such items to be removed and restore such areas to the condition
that existed prior to the installation thereof in accordance with all applicable
laws, statutes, building codes and regulations in effect as of the date of such
repair and restoration.

             29.3      Disposition of
Personal Property.  Whenever
Landlord shall reenter the Premises as provided in Article 12 hereof, or as
otherwise provided in this Lease, any property of Tenant not removed by Tenant
upon the expiration of the Lease Term (or within forty-eight (48) hours after a
termination by reason of Tenant’s default), as provided in this Lease, shall be
considered abandoned and Landlord may remove any or all of such items and
dispose of the same in any manner or store the same in a public warehouse or
elsewhere for the account and at the expense and risk of Tenant, and if Tenant
shall fail to pay the cost of storing any such property after it has been
stored for a period of ninety (90) days or more, Landlord may sell any or all
of such property at public or private sale, in such manner and at such times
and places as Landlord, in its sole discretion, may deem proper, without notice
or to demand upon Tenant, for the payment of all or any part of such charges or
the removal of any such property, and shall apply the proceeds of such
sale:  first, to the cost and expense of
such sale, including reasonable attorneys’ fees for services rendered; second,
to the payment of the cost of or charges for storing any such property; third,
to the payment of any other sums of money which may then or thereafter be due
to Landlord from Tenant under any of the terms hereof; and fourth, the balance,
if any, to Tenant.

             29.4      Removal of Alterations  All fixtures, equipment, alterations,
additions, improvements and/or appurtenances attached to or built into the
Premises prior to or during the Lease Term, whether by Landlord or Tenant and
whether at the expense of Landlord or Tenant, or of both, shall be and remain
part of the Premises and shall not be removed by Tenant at the end of the Lease
Term unless otherwise expressly provided for in this Lease or unless such
removal is required by Landlord pursuant to the provisions of Article 9
above.  Such fixtures, equipment,
alterations, additions, improvements and/or appurtenances shall include but not
be limited to:  all floor coverings,
drapes, paneling, built-in cabinetry, molding, doors, vaults (including vault
doors), plumbing systems, electrical systems, lighting systems, silencing
equipment, communication systems, all fixtures and outlets for the systems
mentioned above and for all telephone, radio, telegraph and television
purposes, and any special flooring or ceiling installations.

ARTICLE 30

MISCELLANEOUS

             30.1      Mortgage Protection  Upon any default on the part of Landlord,
Tenant shall give notice by registered or certified mail to any beneficiary of
a deed of trust or mortgagee of a mortgage covering the Premises who has
provided Tenant with notice of their interest together with an address for
receiving notice, and shall offer such beneficiary or mortgagee a reasonable
opportunity to cure the default (which in no event shall be less than ninety
(90) days), including time to obtain possession of the Premises by power of
sale or judicial foreclosure if such should prove necessary to effect a
cure.  Tenant agrees that each lender to
whom this Lease has been assigned by Landlord is an express third party
beneficiary hereof.  Tenant shall not
make any prepayment of monthly rent more than one (1) month in advance without
the prior written consent of each such lender. 
Tenant waives the collection of any security deposit from such lender(s)
or any purchaser at a foreclosure sale of such lender(s) deed of trust unless
the lender(s) or such purchaser shall have actually received and not refunded
the security deposit.  Tenant agrees to
make all payments under the Lease to the lender with the most senior
encumbrance upon receiving a direction, in writing, to pay said amounts to such
lender.  Tenant shall comply with such
written direction to pay without determining whether an event of default exists
under such lender’s loan to Landlord.

             30.2      Recording  Neither Landlord nor Tenant shall record
this Lease or a short form memorandum thereof without the consent of the other.

             30.3      Financial Statements  At any time during the term of this Lease,
Tenant shall, upon ten (10) days’ prior written notice from Landlord in
connection with a proposed sale or financing of the Project, provide Landlord
with a current financial statement and, if available, financial statements of
the two (2) years prior to the year of the current financial statement.  Such statement shall be prepared in
accordance with generally accepted accounting principles and, if such is the
normal practice of Tenant, shall be audited by an independent certified public
accountant.

             30.4      Severability; Entire
Agreement  Any provision of this
Lease which shall prove to be invalid, void, or illegal shall in no way affect,
impair or invalidate any other provision hereof and any such other provisions
shall remain in full force and effect. 
This Lease and the Exhibits constitute the entire agreement between the
parties hereto with respect to the subject matter hereof, and no prior
agreement or understanding pertaining to any such matter shall be effective for
any purpose.  No provision of this Lease
may be amended or supplemented except by an agreement in writing signed by the
parties hereto or their successor in interest. 
This Lease shall be governed by and construed in accordance with the
laws of the State of California.

             30.5      Attorneys' Fees

                           (a)         If Tenant or Landlord shall bring any
action for any relief against the other, declaratory or otherwise, arising out
of or under this Lease, including any suit by Landlord for the recovery of rent
or possession of the Premises, the losing party shall pay the successful party
a reasonable sum for attorneys’ fees in such suit and such attorneys’ fees
shall be deemed to have accrued on the commencement of such action and shall be
paid whether or not such action is prosecuted to judgment.

                           (b)        Should Landlord, without fault on
Landlord’s part, be made a party to any litigation instituted by Tenant or by
any third party against Tenant, or by or against any person holding under or
using the Premises by license of Tenant, or for the foreclosure of any lien for
labor or material furnished to or for Tenant or any such other person or
otherwise arising out of or resulting from any act or transaction of Tenant or
of any such other person, Tenant covenants to indemnify, defend and hold
Landlord harmless from any judgment, claim or liability rendered against
Landlord or the Premises or any part thereof and from all costs and expenses,
including reasonable attorneys’ fees incurred by Landlord in connection with
such litigation.

                           (c)         Reasonable attorneys’ fees shall
include fees for services rendered prior to the commencement of any such action
or litigation and, when legal services are rendered by an attorney at law who
is an employee of a party, shall be determined as to amount, including
overhead, by consideration of the same factors, including but not limited by,
the importance of the matter, time applied, difficulty and results, as are
considered when an attorney not in the employ of a party is engaged to render
such service.

             30.6      Time of Essence  Each of Tenant’s covenants herein is a
condition and time is of the essence with respect to the performance of every
provision of this Lease and the strict performance of each shall be a condition
precedent to Tenant’s right to remain in possession of the Premises or to have
this Lease continue in effect.

             30.7      Headings  The article headings contained in this Lease are for convenience
only and do not in any way limit or amplify any term or provision hereof.  The terms “Landlord” and “Tenant” as used
herein shall include the plural as well as the singular, the neuter shall
include the masculine and feminine genders and the obligations herein imposed
upon Tenant shall be joint and several as to each of the persons, firms or
corporations of which Tenant may be composed.

             30.8      Reserved Area  Tenant hereby acknowledges and agrees that
the exterior walls of the Premises and the area between the finished ceiling of
the Premises and the slab of the floor of the Building thereabove have not been
demised hereby and the use thereof together with the right to install,
maintain, use, repair and replace pipes, ducts, conduits and wires leading
through, under or above the Premises in locations which will not materially
interfere with Tenant’s use of the Premises and serving other parts of the
Project are hereby excepted and reserved unto Landlord.

             30.9      No Option  The submission of this Lease by Landlord, its agent or
representative for examination or execution by Tenant does not constitute an
option or offer to lease the Premises upon the terms and conditions contained
herein or a reservation of the Premises in favor of Tenant, it being intended
hereby that this Lease shall only become effective upon the execution hereof by
Landlord and delivery of a fully executed counterpart hereof to Tenant.

             30.10    Use of Project Name;
Improvements   Tenant shall not
be allowed to use the name, picture or representation of the Project, or words
to that effect, in connection with any business carried on in the Premises or
otherwise (except as Tenant’s address) without the prior written consent of
Landlord.  In the event that Landlord
undertakes any additional improvements on the real property including but not
limited to new construction or renovation or additions to the existing
improvements, Landlord shall not be liable to Tenant for any noise, dust,
vibration or interference with access to the Premises or disruption in Tenant’s
business caused thereby and rental hereunder shall under no circumstances be
abated; provided, however, that Landlord shall use reasonable efforts to
perform such construction in a manner that does not materially interfere with
Tenant’s use of the Premises.

             30.11    Rules and Regulations  Tenant shall observe faithfully and comply
strictly with the Rules and Regulations attached to this Lease as Exhibit “B”
and made a part hereof, and such other rules and regulations as Landlord may
from time to time reasonably adopt for the safety, care and cleanliness of the
Project, the facilities thereof, or the preservation of good order
therein.  Landlord shall not be liable
to Tenant for violation of any such Rules and Regulations, or for the breach of
any covenant or condition in any lease by any other tenant in the Project.  A waiver by Landlord of any Rule or
Regulation for any other tenant shall not constitute nor be deemed a waiver of
the Rule or Regulation for this Tenant.

             30.12    Quiet Possession  Upon Tenant’s paying the Basic Rental,
Additional Rent and other sums provided hereunder and observing and performing
all of the covenants, conditions and provisions on Tenant’s part to be observed
and performed hereunder, Tenant shall have quiet possession of the Premises for
the entire term hereof, subject to all of the provisions of this Lease.

             30.13    Additional Rent  All amounts which Tenant is required to pay
hereunder (other than Basic Rental) and all damages, costs and expenses which
Landlord may incur by reason of any default by Tenant shall be deemed to be
“Additional Rent” hereunder, whether or not described or designated as
such.  Upon Tenant’s non payment of any
Additional Rent, Landlord shall have all the rights and remedies with respect
thereto as Landlord has for the non-payment of Basic Rental.

             30.14    Substitute Premises  With respect to the Ninth Floor Premises,
Landlord shall have the right at any time during the Lease Term, upon giving
Tenant not less than sixty (60) days prior written notice, to provide and
furnish Tenant with space elsewhere in the Building (provided that such space
shall be located on or above the ninth (9th) floor of the Building) of
approximately the same size and containing the same tenant improvements (which
tenant improvements shall be constructed by Landlord at Landlord’s sole cost
and expense) as the Ninth Floor Premises and remove and place Tenant in such
space, with Landlord to pay all verified and previously approved costs and
expenses incurred as a result of such removal of Tenant, exclusive of the cost
of replacing Tenant’s existing supply of stationery and business cards.  Should Tenant refuse to permit Landlord to
move Tenant to such new space at the end of said sixty (60) day period, Landlord
shall have the right to cancel and terminate this Lease with respect to the
Ninth Floor Premises and Tenant’s prospective obligations hereunder with
respect to the Ninth Floor Premises effective ninety (90) days after the date
of Landlord’s original notification to Tenant of its intent to relocate
Tenant.  If Landlord moves Tenant to
such new space, this Lease and each and all of its terms, covenants and
conditions shall remain in full force and effect and shall be deemed applicable
to such new space and such new space shall thereafter be deemed to be the
“Substituted Ninth Floor Premises” as though Landlord and Tenant had entered
into an express written amendment of this Lease with respect thereto.

             30.15    Successors and Assigns  Subject to the provisions of Article 15
hereof, all of the covenants, conditions and provisions of this Lease shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns.

             30.16    Notices  Any notice required or permitted to be given hereunder shall be in
writing and may be given by personal service evidenced by a signed receipt or
sent by registered or certified mail, return receipt requested, addressed to
Tenant at the Premises or to Landlord at the address of the place from time to
time established for the payment of rent and which shall be effective upon
proof of delivery.  Either party may by
notice to the other specify a different address for notice purposes except
that, upon Tenant’s taking possession of the Premises, the Premises shall
constitute Tenant’s address for notice purposes.  A copy of all notices to be given to Landlord hereunder shall be
concurrently transmitted by Tenant to such party hereafter designated by notice
from Landlord to Tenant.

             30.17    Persistent Delinquencies  In the event that Tenant shall be delinquent
by more than fifteen (15) days in the payment of rent on three (3) separate
occasions in any twelve (12) month period, Landlord shall have the right to
require Tenant to pay Basic Rental and Additional Rent in advance on a
quarterly basis.

             30.18    Right of Landlord to Perform  All covenants and agreements to be performed
by Tenant under any of the terms of this Lease shall be performed by Tenant at
Tenant’s sole cost and expense and without any abatement of rent.  If Tenant shall fail to pay any sum of
money, other than rent, required to be paid by it hereunder or shall fail to
perform any other act on its part to be performed hereunder, and such failure
shall continue beyond any applicable period of notice and cure period set forth
in this Lease, Landlord may, but shall not be obligated so to do, and without
waiving or releasing Tenant from any obligations of Tenant, make any such
payment or perform any such other act on Tenant’s part to be made or performed
as is in this Lease provided.  All sums
so paid by Landlord and all reasonable incidental costs, together with interest
thereon at the rate of ten percent (10%) per annum from the date of such
payment by Landlord, shall be payable to Landlord on demand and Tenant
covenants to pay any such sums, and Landlord shall have (in addition to any
other right or remedy of Landlord) the same rights and remedies in the event of
the nonpayment thereof by Tenant as in the case of default by Tenant in the
payment of the rent.

             30.19    Access, Changes
in Project, Facilities, Name

                           (a)         Every part of the Project except the
inside surfaces of all walls, windows and doors bounding the Premises
(including exterior building walls, core corridor walls and doors and any core
corridor entrance), and any space in or adjacent to the Premises used for
shafts, stacks, pipes, conduits, fan rooms, ducts, electric or other utilities,
sinks or other building facilities, and the use thereof, as well as access
thereto through the Premises for the purposes of operation, maintenance,
decoration and repair, are reserved to Landlord.

                           (b)        Tenant shall permit Landlord to install,
use and maintain pipes, ducts and conduits within the walls, bearing columns
and ceilings of the Premises.

                           (c)         Landlord reserves the right, without
incurring any liability to Tenant therefor, to make such changes in or to the
Building and the fixtures and equipment thereof, as well as in or to the street
entrances, halls, passages, elevators, stairways and other improvements
thereof, as it may deem necessary or desirable; provided, however, Landlord
shall use reasonable efforts to perform such modifications in a manner that
does not materially interfere with Tenant’s use of or access to the Premises.

                           (d)        Landlord may adopt any name for the
Project and Landlord reserves the right to change the name or address of the
Building at any time upon notice to Tenant.

             30.20    Corporate Authority  If Tenant is a corporation, each individual
executing this Lease on behalf of said corporation represents and warrants that
he is duly authorized to execute and deliver this Lease on behalf of said
corporation in accordance with a duly adopted resolution of the Board of
Directors of said corporation or in accordance with the By-laws of said
corporation, and that this Lease is binding upon said corporation in accordance
with its terms.  Concurrently with the
execution of this Lease, Tenant shall provide to Landlord a copy of such
resolution of the Board of Directors authorizing the execution of this Lease on
behalf of such corporation, which copy of resolution shall be duly certified by
the secretary or an assistant secretary of the corporation to be a true copy of
a resolution duly adopted by the Board of Directors of said corporation, or
other written evidence satisfactory to Landlord showing the authority of the
individuals executing this Lease on behalf of Tenant to execute this Lease and
bind the corporation.

             30.21    Identification of Tenant

            (a)                   If
more than one person executes this Lease as Tenant, (i) each of them shall be
jointly and severally liable for the keeping, observing and performing of all
of the terms, covenants, conditions and provisions of this Lease to be kept,
observed and performed by Tenant, (ii) the term “Tenant” as used in this Lease
shall mean and include each of them jointly and severally, and (iii) the act of
or notice from, or notice or refund to, or the signature of, any one or more of
them, with respect to the tenancy of this Lease, including, but not limited to,
any renewal, extension, expiration, termination or modification of this Lease,
shall be binding upon each and all of the persons executing this Lease as
Tenant with the same force and effect as if each and all of them had so acted
or so given or received such notice or refund or so signed.

            (b)                   If
Tenant is a partnership (or is comprised of two or more persons, individually
and as co-partners of a partnership) or if Tenant’s interest in this Lease
shall be assigned to a partnership (or to two or more persons, individually and
as co-partners of a partnership) pursuant to Article 15 hereof (any such
partnership and such persons hereinafter referred to in this Article 30.21 as
“Partnership Tenant”), the following provisions of this Lease shall apply to
such Partnership Tenant:

                        (i)        The liability of each of the parties
comprising Partnership Tenant shall be joint and several.

                        (ii)       Each of the parties comprising the
Partnership Tenant hereby consents in advance to, and agrees to be bound by,
any written instrument which may hereafter be executed, changing, modifying or
discharging this Lease, in whole or in part, or surrendering all or any part of
the Premises to the Landlord, and by notices, demands, requests or other
communication which may hereafter be given, by Partnership Tenant or any of the
parties comprising Partnership Tenant.

                        (iii)      Any bills, statements, notices, demands,
requests or other communications given or rendered to Partnership Tenant or to
any of the parties comprising Partnership Tenant shall be deemed given or
rendered to Partnership Tenant and to all such parties and shall be binding
upon Partnership Tenant and all such parties.

                        (iv)      If Partnership Tenant admits new partners,
all of such new partners shall, by their admission to Partnership Tenant, be
deemed to have assumed performance of all of the terms, covenants and
conditions of this Lease on Tenant’s part to be observed and performed.

                        (v)       Partnership Tenant shall give prompt
notice to Landlord of the admission of any such new partners, and, upon demand
of Landlord, shall cause each such new partner to execute and deliver to
Landlord an agreement in form reasonably satisfactory to Landlord, wherein each
such new partner shall assume performance of all of the terms, covenants and
conditions of this Lease on Partnership Tenant’s part to be observed and
performed (but neither Landlord’s failure to request any such agreement nor the
failure of any such new partner to execute or deliver any such agreement to
Landlord shall violate the provisions of clause (iv) of this Article 30.21 or
relieve any such new partner of his obligations thereunder).

             30.22    Building Codes  Any and all costs attributable to or related
to the applicable building codes of the City of El Segundo (or any other
authority having jurisdiction over the Project) arising from Tenant’s plans,
specifications, improvements, alterations or otherwise shall be paid by Tenant
at its sole cost and expense.

             30.23    Transportation and Energy
Management  Tenant shall fully
comply with all present and future programs intended to manage parking,
transportation, traffic, energy or any other programs affecting the Project.

             30.24    ERISA Certificate  Concurrently with the execution and delivery
of this Lease, Tenant shall execute and deliver to Landlord an ERISA
Certificate in the form attached hereto as Exhibit “E”.

             30.25    Exhibits  The Exhibits attached hereto are incorporated herein by this
reference as if fully set forth herein.

             30.26    Waiver of Jury Trial  LANDLORD AND TENANT HEREBY KNOWINGLY,
VOLUNTARILY, AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY WITH RESPECT
TO ANY LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS LEASE OR ANY DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH
OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER ORAL OR
WRITTEN) OR ACTIONS OF EITHER PARTIES ARISING OUT OF OR RELATED IN ANY MANNER
WITH THE PREMISES (INCLUDING WITHOUT LIMITATION, ANY ACTION TO RESCIND OR
CANCEL THIS LEASE OR ANY CLAIMS OR DEFENSES ASSERTING THAT THIS LEASE WAS
FRAUDULENTLY INDUCED OR OTHERWISE VOIDABLE). 
THIS WAIVER IS A MATERIAL INDUCEMENT FOR LANDLORD TO ENTER INTO AND TO
ACCEPT THIS LEASE.

ARTICLE 31

OPTION TO EXTEND

             31.1      Grant of Option  Landlord hereby grants to Tenant two (2)
options (the “Options”) to extend the initial Lease Term (“Initial Term”) for
additional periods of five (5) years each (each, an “Option Term”) upon and
subject to the terms and conditions set forth in this Lease.  The first Option Term shall commence upon
the expiration of the Initial Term and the second Option Term shall commence
upon the expiration of the first Option Term. 
Tenant may not exercise the second Option if Tenant has not exercised
the first Option.  Tenant shall have no
right to extend the Initial Term except as provided herein.  The Options shall be personal to En Pointe
Technologies, Inc. and shall not be transferable or assignable to any assignee
of the Lease.  Each Option shall be
exercised, if at all, by Tenant’s delivery of written notice of exercise to
Landlord no later than nine (9) months nor earlier than twelve (12) months
prior to the expiration date of the Initial Term, with respect to the first
Option, or the first Option Term, with respect to the second Option.  The Basic Rental to be paid during each
Option Term shall be the Prevailing Market Rental, as hereinafter defined.  As used herein, the term “Prevailing Market
Rental” shall mean the rental and all other monetary payments and escalations
that Landlord could obtain from a third party tenant comparable to Tenant
desiring to lease the Premises for the applicable Option Term, taking into
account the age of the Project, the size of the Premises, the type and quality
of tenant improvements, the location and floor levels of the Premises, the
quality of construction of the Project and the Premises, the services provided
under the terms of the Lease, the rental and brokers commissions then being
paid for the renewal of leases of space comparable to the Premises in the City
of El Segundo and all other factors that would be relevant to a third party in
determining the rental such party would be willing to pay to lease the Premises
for the applicable Option Term (including any concessions then being offered);
provided, however, in no event shall the Prevailing Market Rental be less than
the Basic Rental payable by Tenant to Landlord at the expiration of the Initial
Term, with respect to the first Option, or the first Option Term, with respect
to the second Option.  Tenant’s exercise
of an Option shall be of no force and effect if Tenant is in default under any
of the terms, covenants or conditions of this Lease at the time of Tenant’s
exercise of the applicable Option; provided, however, Tenant may still exercise
the applicable Option if Tenant cures such default within the applicable cure
period and exercises such Option prior to the expiration of the time period set
forth above for such exercise.  If (i)
an Event of Default occurs at any time after Tenant exercises the applicable
Option or (ii) Tenant does not occupy all of the Premises, either at the time
Tenant exercises the applicable Option or at any time thereafter prior to the
commencement date of the applicable Option Term (each, an “Option Commencement
Date”), then, in each case, Tenant’s exercise of the applicable Option shall be
of no force and effect and Tenant shall have no rights hereunder to extend the
term of this Lease for the applicable Option Term.

             31.2      Determination
of Prevailing Market Rental  On
or before five (5) days after Tenant provides Landlord with notice of Tenant’s
exercise of an Option, Landlord and Tenant shall commence negotiations to agree
upon the Prevailing Market Rental applicable thereto.  If Landlord and Tenant are unable to reach agreement on the
Prevailing Market Rental within ten (10) days after the date negotiations
commence, then the Prevailing Market Rental shall be determined as follows:

                           (a)         If Landlord and Tenant are unable to
agree on the Prevailing Market Rental within said ten (10) day period, then,
within five (5) days thereafter, Landlord and Tenant shall each simultaneously
submit to the other in a sealed envelope its good faith estimate of the
Prevailing Market Rental.  If the higher
of such estimates is not more than one hundred five percent (105%) of the lower
of such estimates, then the Prevailing Market Rental shall be the average of
the two estimates; provided, however, in no event shall the Prevailing Market
Rental be less than the Basic Rental payable by Tenant to Landlord at the
expiration of the Initial Term, with respect to the first Option, or the first
Option Term, with respect to the second Option.

                           (b)        If the matter is not resolved by the
exchange of estimates as provided in subparagraph (a) above, then either
Landlord or Tenant may, by written notice to the other on or before five (5)
days after the exchange of such estimates, require that the disagreement be
resolved by arbitration.  Within seven
(7) days after such notice, the parties shall select as an arbitrator a
mutually acceptable MAI appraiser with experience in real estate activities,
including at least ten (10) years’ experience in appraising office space in the
County of Los Angeles, California.  If
the parties cannot agree on an appraiser, then, within a second period of seven
(7) days, each party shall select an independent MAI appraiser meeting the
aforementioned criteria and, within a third period of seven (7) days, the two
appointed appraisers shall select a third appraiser meeting the aforementioned
criteria and the third appraiser shall determine the Prevailing Market Rental
pursuant to subparagraph (c) below.  If
one party shall fail to make such appointment within said second seven (7) day
period, then the appraiser chosen by the other party shall be the sole
arbitrator.

                           (c)         Once the arbitrator has been selected
as provided for in subparagraph (b) above, then, as soon as practicable but in
any case within fourteen (14) days thereafter, the arbitrator shall select one
of the two estimates of the Prevailing Market Rental submitted by Landlord and
Tenant, which estimate shall be the one that is closer to the Prevailing Market
Rental as determined by the arbitrator; provided, however, in no event shall
the Prevailing Market Rental be less than the Basic Rental payable by Tenant to
Landlord at the expiration of the Initial Term, with respect to the first
Option, or the first Option Term, with respect to the second Option.  The arbitrator’s selection shall be rendered
in writing to both Landlord and Tenant and shall be final and binding upon them
and shall not be subject to appeal.  If
the arbitrator believes that expert advice would materially assist such
arbitrator, then the arbitrator may retain one or more qualified persons,
including, but not limited to, legal counsel, brokers, architects or engineers,
to provide such expert advice.  The
party whose estimate is not chosen by the arbitrator shall pay the costs of the
arbitrator and of any experts retained by the arbitrator; provided, however,
that any fees of any counsel or expert engaged directly by Landlord or Tenant
shall be borne by the party retaining such counsel or expert.

ARTICLE 32

SIGNAGE

             Tenant
shall not place any sign upon the Premises, the Building or the Project or
conduct any auction thereon without Landlord’s prior written consent, which
consent may be withheld by Landlord in its sole and absolute discretion.  Promptly following the Commencement Date,
Landlord shall install Tenant’s name on the directory of the Building lobby in
accordance with Landlord’s sign criteria. 
Tenant shall pay Landlord’s standard charges for installation for
Tenant’s directory sign.

             IN
WITNESS WHEREOF, the parties hereto have executed this Lease as of the date set
forth above.

	 	TENANT:	 
	 	 	 
	 	EN POINTE TECHNOLOGIES, INC.,  

  a Delaware corporation	 
	 	 	 
	 	By:	 	 
	 	 	

	 
	 	Its:	 	 
	 	 	

	 
	 	By:	 	 
	 	 	

	 
	 	Its:	 	 
	 	 	

	 
	 	LANDLORD:	 
	 	 	 
	 	PACIFIC
  CORPORATE TOWERS LLC, a Delaware limited liability company	 
	 	 	 
	 	By:
  GE Capital Investment Advisors, Inc., its manager	 
	 	 	 
	 	By:	 
	 	

	 
	 	 Vice President	 
						

EXHIBIT
“A-1”

NINTH
FLOOR PREMISES

EXHIBIT “A-2”

NINETEENTH FLOOR PREMISES

EXHIBIT
“B”

RULES
AND REGULATIONS

             1.          No sign, advertisement or notice shall
be displayed, printed or affixed on or to the Premises or to the outside or
inside of the Building or so as to be visible from outside the Premises or
Building without Landlord’s prior written consent.  Landlord shall have the right to remove any non-approved sign,
advertisement or notice, without notice to and at the expense of Tenant, and
Landlord shall not be liable in damages for such removal.  All approved signs or lettering on doors and
walls shall be printed, painted, affixed or inscribed at the expense of Tenant
by Landlord or by a person selected by Landlord and in a manner and style
acceptable to Landlord.

             2.          Tenant shall not obtain for use on the
Premises ice, drinking water, waxing, cleaning, interior glass polishing,
rubbish removal, towel or other similar services, or accept barbering or
bootblackening, or coffee cart services, milk, soft drinks or other like
services on the Premises, except from persons authorized by Landlord and at the
hours and under regulations fixed by Landlord. 
No vending machines or machines of any description shall be installed,
maintained or operated upon the Premises without Landlord’s prior written
consent.

             3.          The sidewalks, hall, passages, exits,
entrances, elevators and stairways shall not be obstructed by Tenant or used
for any purpose other than for ingress and egress from Tenant’s Premises.

             4.          Toilet rooms, toilets, urinals, wash
bowls and other apparatus shall not be used for any purpose other than for
which they were constructed and no foreign substance of any kind whatsoever
shall be thrown therein.

             5.          Tenant shall not overload the floor of
the Premises or mark, drive nails, screw or drill into the partitions, ceilings
or floor or in any way deface the Premises; provided, however, the foregoing
shall not prohibit the hanging of pictures or wall decorations.

             6.          In no event shall Tenant place a load
upon any floor of the Premises or portion of any such flooring exceeding the
floor load per square foot of area for which such floor is designed to carry
and which is allowed by law, or any machinery or equipment which shall cause
excessive vibration to the Premises or noticeable vibration to any other part
of the Building.  Prior to bringing any
heavy safes, vaults, large computers or similarly heavy equipment into the
Building, Tenant shall inform Landlord in writing of the dimensions and weights
thereof and shall obtain Landlord’s consent thereto, which consent Landlord
shall have the right to deny.  Such
consent shall not constitute a representation or warranty by Landlord that the
safe, vault or other equipment complies, with regard to distribution of weight
and/or vibration, with the provisions of this Rule 6 nor relieve Tenant from
responsibility for the consequences of such noncompliance, and any such safe,
vault or other equipment which Landlord determines to constitute a danger of
damage to the Building or a nuisance to other Tenants, either alone or in
combination with other heavy and/or vibrating objects and equipment, shall be
promptly removed by Tenant upon Landlord’s written notice of such determination
and demand for removal thereof.

             7.          Tenant shall not use or keep in the Premises or Project any
kerosene, gasoline or inflammable, explosive or combustible fluid or material,
or use any method of heating or air-conditioning other than that supplied by
Landlord.

             8.          Tenant shall not lay linoleum, tile,
carpet or other similar floor covering so that the same shall be affixed to the
floor of the Premises in any manner except as approved by Landlord.

             9.          Tenant shall not install or use any
blinds, shades, awnings or screens in connection with any window or door of the
Premises and shall not use any drape or window covering facing any exterior
glass surface other than the standard drapes, blinds or other window covering
established by Landlord.

             10.        Tenant shall cooperate with Landlord in
obtaining maximum effectiveness of the cooling system by closing drapes when
the sun’s rays fall directly on windows of the Premises.  Tenant shall not obstruct, alter, or in any
way impair the efficient operation of Landlord’s heating, ventilating and
air-conditioning system.  Tenant shall
not tamper with or change the setting of any thermostats or control valves.

             11.        The Premises shall not be used for
manufacturing or for the storage of merchandise except as such storage may be
incidental to the permitted use of the Premises.  Tenant shall not, without Landlord’s prior written consent,
occupy or permit any portion of the Premises to be occupied or used for the
manufacture or sale of liquor or tobacco in any form, or a barber or manicure
shop, or as an employment bureau.  The
Premises shall not be used for lodging or sleeping or for any improper,
objectionable or immoral purpose.  No auction
shall be conducted on the Premises.

             12.        Tenant shall not make, or permit to be
made, any unseemly or disturbing noises, or disturb or interfere with occupants
of Building or neighboring buildings or premises or those having business with
it by the use of any musical instrument, radio, phonographs or unusual noise,
or in any other way.

             13.        No bicycles, vehicles or animals of any
kind shall be brought into or kept in or about the Premises, and no cooking
shall be done or permitted by any tenant in the Premises, except that the
re-heating of food and the preparation of coffee, tea, hot chocolate and
similar items for tenants, their employees and visitors shall be
permitted.  No tenant shall cause or
permit any unusual or objectionable odors to be produced in or permeate from or
throughout the Premises.

             14.        The sashes, sash doors, skylights,
windows and doors that reflect or admit light and air into the halls,
passageways or other public places in the Building shall not be covered or
obstructed by any tenant, nor shall any bottles, parcels or other articles be
placed on the window sills.

             15.        No additional locks or bolts of any kind
shall be placed upon any of the doors or windows by any tenant, nor shall any
changes be made in existing locks or the mechanisms thereof unless Landlord is
first notified thereof, gives written approval, and is furnished a key
therefor.  Each tenant must, upon the
termination of his tenancy, give to Landlord all keys of stores, offices, or
toilets or toilet rooms, either furnished to, or otherwise procured by, such
tenant, and in the event of the loss of any keys so furnished, such tenant
shall pay Landlord the cost of replacing the same or of changing the lock or
locks opened by such lost key if Landlord shall deem it necessary to make such
change.

             16.        Landlord shall have the right to prohibit any advertising by
any tenant which, in Landlord’s opinion, tend to impair the reputation of the
Building or its desirability as an office building and upon written notice from
Landlord any tenant shall refrain from and discontinue such advertising.

             17.        Landlord reserves the right to control
access to the Building by all persons after reasonable hours of generally
recognized business days and at all hours on Sundays and legal holidays.  Each tenant shall be responsible for all
persons for whom he requests after hours access and shall be liable to Landlord
for all acts of such persons.  Landlord
shall have the right from time to time to establish reasonable rules pertaining
to freight elevator usage, including the allocation and reservation of such
usage for tenants’ initial move-in to their premises, and final departure
therefrom.

             18.        Any person employed by any tenant to do
janitorial work shall, while in the Building and outside of the Premises, be
subject to and under the control and direction of the office of the Building
(but not as an agent or servant of Landlord, and the tenant shall be
responsible for all acts of such persons).

             19.        All doors opening on to public corridors
shall be kept closed, except when being used for ingress and egress.

             20.        The requirements of tenants will be
attended to only upon application to the Office of the Building.

             21.        Canvassing, soliciting and peddling in
the Building are prohibited and each tenant shall cooperate to prevent the
same.

             22.        All office equipment of any electrical
or mechanical nature shall be placed by tenants in the Premises in settings
reasonably approved by Landlord, to absorb or prevent any vibration, noise or
annoyance.

             23.        No air conditioning unit or other
similar apparatus shall be installed or used by any tenant without the prior
written consent of Landlord.  Tenant
shall pay the cost of all electricity used for air conditioning in the Premises
if such electrical consumption exceeds normal office requirements, regardless
of whether additional apparatus is installed pursuant to the preceding
sentence.

             24.        There shall not be used in any space, or
in the public halls of the Building, either by any tenant or others, any hand
trucks except those equipped with rubber tires and side guards.

             25.        All electrical ceiling fixtures hung in
offices or spaces along the perimeter of the Building must be florescent and/or
of a quality, type, design and bulb color approved by Landlord.  Tenant shall not permit the consumption in
the Premises of more than 2 1/2 watts per net usable square foot in the
Premises in respect of office lighting nor shall Tenant permit the consumption
in the Premises of more than 1 1/2 watts per net usable square foot of space in
the Premises in respect of the power outlets therein, at any one time.  In the event that such limits are exceeded,
Landlord shall have the right to remove any lighting fixture of any florescent
tube or bulb therein as it deems necessary and/or to charge Tenant for the cost
of the additional electricity consumed.

             26.        Parking

                           (a)         The parking garage shall be staffed
from 5:00 a.m. to 8:00 p.m., Monday through Friday, state and federal holidays
excepted, as revised from time to time by Landlord.

                           (b)        Automobiles must be parked entirely with
the stall lines on the floor.

                           (c)         All directional signs and arrows must
be observed.

                           (d)        The speed limit shall be 5 miles per
hour.

                           (e)         Parking is prohibited in areas not
striped for parking.

                           (f)         Parking cards or any other device or
form of identification supplied by Landlord (or its operator) shall remain the
property of Landlord (or its operator). 
Such parking identification device must be displayed as requested and
may not be mutilated in any manner.  The
serial number of the parking identification device may not be obliterated.  Devices are not transferable or assignable
and any device in the possession of an unauthorized holder will be void.  There will be a replacement charge to the
Tenant or person designated by Tenant of $25.00 for loss of any parking card.

                           (g)        The monthly rate for parking is payable
one (1) month in advance and must be paid by the third business day of each
month.  Failure to do so will
automatically cancel parking privileges and a charge at the prevailing daily rate
will be due.  No deductions or allowances
from the monthly rate will be made for days parker does not use Parking
Facilities.

                           (h)        Tenant may validate visitor parking by
such method or methods as the Landlord may approve, at the validation rate from
time to time generally applicable to visitor parking.

                           (i)          Landlord (and its operator) may refuse
to permit any person who violates the within rules to park in the garage, and
any violation of the rules shall subject the automobile to removal from the
garage at the parker’s expense.  In
either of said events, Landlord (or its operator) shall refund a prorata
portion of the current monthly parking rate and the sticker or any other form
of identification supplied by Landlord (or its operator) will be returned to
Landlord (or its operator).

                           (j)          Garage managers or attendants are not
authorized to make or allow any exceptions to these Rules and Regulations.

                           (k)         Every parker is required to park and
lock his own automobile.  All
responsibility for any loss or damage to automobiles or any personal property
therein is assumed by the parker.

                           (l)          Loss or theft of parking
identification devices from automobiles must be reported to the garage manager
immediately, and a lost or stolen report must be filed by the parker at that
time.

                           (m)        The Parking Facilities are for the sole
purpose of parking one automobile per space. 
Washing, waxing, cleaning or servicing of any vehicles by the parker or
his agents is prohibited.

                           (n)        Landlord (and its operator) reserves the
right to refuse the issuance of monthly stickers or other parking
identification devices to any Tenant and/or its employees who refuse to comply
with the above Rules and Regulations and all posted and unposted City, State or
Federal ordinances, laws or agreements.

                           (o)        Tenant agrees to acquaint all employees
with these Rules and Regulations.

             27.        Smoking is expressly prohibited in the
Premises and any and all enclosed areas within the Building or Project,
including without limitation, the lobbies, restrooms and interior common areas.

EXHIBIT
“C”

WORK
LETTER AGREEMENT

             This
Work Letter Agreement supplements the Standard Office Lease (the “Lease”) dated
as of this ___ day of April, 2001 executed concurrently herewith by and between
Landlord and Tenant, covering certain premises described in the Lease (the
“Premises”).  All terms not defined
herein shall have the same meaning as set forth in the Lease.

             1.          Plans and  Drawings for Premises.

                           1.1        Space Plans

                           Tenant
shall cause Tenant’s architect to furnish for Landlord’s approval preliminary
space plans sufficient to convey the architectural design of the tenant
improvements required by Tenant in the Premises (“Space Plans”).  If Landlord shall disapprove of any part of
the Space Plans, Landlord shall, within five (5) days after receipt thereof,
advise Tenant in writing of Landlord’s objections thereto.  Landlord and Tenant shall thereafter
negotiate in good faith to revise the Space Plans to remove Landlord’s
objections.  After Landlord and Tenant
have reached such agreement, Tenant shall furnish to Landlord for review and
approval in accordance with the foregoing procedure a revision of the Space
Plans incorporating the revisions agreed to by Landlord and Tenant.  Landlord and Tenant shall each indicate
their reasonable approval of the Space Plans by initialing the same.

                           1.2        Final Working Drawings.

                           Tenant
shall cause Tenant’s architect to prepare from the approved Space Plans and
furnish to Landlord and Tenant for review and approval, complete architectural
plans, drawings and specifications and complete engineered mechanical,
structural and electrical Working Drawings for (i) all of the Premises, showing
the demising plan, improvements, and Tenant’s design work, (ii) Tenant’s
electrical, plumbing and lighting requirements, and (iii) any internal or
external communications or special utility facilities (collectively “Final
Working Drawings and Specifications”; the work shown thereon being called the
“Tenant Work”), all in such form and in such detail as may be reasonably
required by Landlord.  Concurrently with
the delivery of the Final Working Drawings and Specifications to Landlord for
its approval, Tenant shall cause Tenant’s architect to deliver to Landlord and
Tenant for review and approval: (i) a schedule of values allocating costs
to the various portions of the work involved in the construction and
installation of the improvements required by the Final Working Drawings and
Specifications (“Schedule of Values”), (ii) an estimate of the total Work
Cost (“Work Cost Estimate”) for the Tenant Work to which the Final Working
Drawings and Specifications relate, and (iii) a tentative construction
schedule for the Tenant Work represented by the Final Working Drawings and
Specifications showing the anticipated commencement date and projected completion
date (“Tentative Construction Schedule”). 
Tenant’s architect and/or contractor shall provide all services
necessary for the preparation of the Final Working Drawings and Specifications,
Schedule of Values, Work Cost Estimate and Tentative Construction Schedule and
for securing such permits and approvals as, by reason of the nature of the
Tenant Work, shall be required from any governmental authority having
jurisdiction over such work or for compliance with applicable statutes, codes,
ordinances, rules or regulations deemed necessary by Landlord in connection
with the Tenant Work, including, without limitation, OSHA and CAL-OSHA,
life-safety and sprinklers.

                           If
Landlord shall disapprove of any part of the Final Working Drawings and
Specifications, Schedule of Values, Work Cost Estimate or Tentative
Construction Schedule, Landlord shall, within five (5) days after receipt
thereof, advise Tenant in writing of the reasons therefore and the
modifications that are required by Landlord to approve the Final Working Drawings
and Specifications, Schedule of Values, Work Cost Estimate and Tentative
Construction Schedule.  Landlord and
Tenant shall thereafter meet with Tenant’s architect and/or contractor and
negotiate in good faith to modify the Final Working Drawings and
Specifications, Schedule of Values, Work Cost Estimate and/or Tentative
Construction Schedule to remove Landlord’s objections.  Once the parties have agreed on such
modifications, Tenant shall cause Tenant’s architect and/or contractor to
revise the Final Working Drawings and Specifications, Schedule of Values, Work
Cost Estimate or Tentative Construction Schedule to incorporate the agreement
of the parties and submit such revisions to Landlord for approval in accordance
with the foregoing procedure.  The Final
Working Drawings and Specifications shall comply with all conditions set forth
in Section 1.3 below.  As soon as
Landlord approves the Final Working Drawings and Specifications, Schedule of
Values, Work Cost Estimate and Tentative Construction Schedule, Landlord and
Tenant shall each sign the same.  As
hereinafter used in this Work Letter Agreement, the term “Final Working
Drawings and Specifications” shall mean the Final Working Drawings and
Specifications (as defined hereinabove), Schedule of Values, Work Cost Estimate
and Tentative Construction Schedule approved by Landlord, together with any
Change Orders approved pursuant to Section 1.4 below.  All architectural and engineering fees and
consultant fees incurred by Landlord in connection with Landlord’s review and
approval of the Space Plans, Schedule of Values, Work Cost Estimate, Final
Working Drawings and Specifications and Tentative Construction Schedule shall
be deducted from the Allowance.

                           1.3        Requirements of Final Working
Drawings and Specifications.

                           The
Final Working Drawings and Specifications shall: (i) be in conformance with the
base Building shell and with the design, construction and equipment of the
Building and with Building standards and specifications in effect for the
Project; (ii) comply with all applicable laws and ordinances, and the rules and
regulations of all governmental authorities having jurisdiction, including,
without limitation, all rules, regulations, ordinances or laws governing
asbestos-containing material, hazardous waste, the Americans with Disabilities
Act, OSHA, CAL-OSHA, life-safety, and sprinklers; (iii) comply with all
applicable insurance regulations for fire resistive Class A Buildings; and (iv)
include locations and complete and exact dimensions.

                           1.4        Changes at Tenant's Expense.

                           Once
approved by Landlord, there shall be no change to the Final Working Drawings
and Specifications approved by Landlord without the prior written consent of
Landlord.  If Tenant desires to makes
any changes to the Final Working Drawings and Specifications after approval
thereof by Landlord, or if the Final Working Drawings and Specifications or any
amendment thereof or supplement thereto shall require changes in the Building
shell or base Building systems, the increased cost of the Building shell work
or base Building systems work caused by such changes shall (to the extent such
increase is in excess of the Allowance) be paid by Tenant, including without
limitation, the cost of permits, consultants, mitigation fees, surcharges,
additional supervisory fees, administrative fees, and all direct architectural
and/or engineering fees and expenses, including the fees of Landlord’s
architect and/or engineer incurred in reviewing any such changes, amendments or
supplements to the Final Working Drawings and Specifications.  All Change Orders requested by Tenant shall
be made in writing, shall include detailed plans and specifications therefor
prepared by Tenant’s architect and shall specify the estimated amount of any
added or reduced cost resulting therefrom. 
Within five (5) business days following delivery of a Change Order,
Landlord shall approve or disapprove the work contained in the Change
Order.  If Landlord disapproves any
Change Order, Landlord shall, within five (5) business days after receipt
thereof, advise Tenant in writing of such revisions and the reasons therefor as
are reasonably required by Landlord to approve the Change Order.  Landlord’s approval of a Change Order shall
not be unreasonably withheld; provided, however, it shall not be deemed
unreasonable for Landlord to withhold consent to any Change Order that requires
changes in the Building shell and/or base Building systems.  If Landlord delivers written notice of
disapproval of a Change Order, Landlord and Tenant shall thereafter negotiate
in good faith to reach agreement upon revisions to the Change Order to remove
Landlord’s objections thereto.  Change
Orders may be approved orally by Landlord’s designated representative with
written confirmation to be delivered to Landlord within five (5) business days
thereafter.  If any such change,
deletion or addition increases the cost of construction and installation of the
Tenant Work in excess of the Allowance, Tenant shall pay the amount of the
increase.

             1.5        No Representations or Warranties Regarding Plans.

                            In no event shall the approval by Landlord of
the Space Plans and/or the Final Working Drawings and Specifications, or any
Change Order constitute a representation or warranty by Landlord of (i) the
accuracy or completeness thereof, (ii) the absence of design defects or
construction flaws therein, or (iii) compliance thereof with applicable
statutes, laws and ordinances and Tenant agrees that Landlord shall incur no
liability by reason of such approval.

             2.          Selection of Contractor.

                           2.1        Contractors.

                           At
such time as Landlord and Tenant have approved the Final Working Drawings and
Specifications, Tenant shall request bids for the installation of the Tenant
Work from three contractors selected by Tenant from Landlord’s list of approved
contractors and Tenant shall select a contractor (“Contractor”) from the bids
received.  Thereafter, Tenant shall submit to Landlord, for
Landlord’s approval, Tenant’s construction contract with its Contractor.  Such construction contract shall be
consistent with the terms of this Work Letter Agreement.  Within five (5) business days following the
delivery of the construction contract, Landlord shall either approve such
contract or deliver to Tenant written objections thereto.  If Landlord disapproves the construction
contract or any part thereof, then Landlord and Tenant shall negotiate in good
faith to reach agreement as expeditiously as possible on such disapproved items
and any necessary amendments to the contract. 
Following Landlord’s approval, Tenant shall not amend or consent to the
amendment of the construction contract without Landlord’s prior written
approval.  Prior to commencement of
construction of the Tenant Work, Tenant shall submit to Landlord a list of
subcontractors to be used by Contractor in the construction of the Tenant
Work.  Any of the subcontractors on such
list may be used unless Landlord provides written notice of Landlord’s
reasonable disapproval (together with an explanation therefor) of one or more
subcontractors to Tenant within ten (10) days after receipt of such list.  Once the Final Working Drawings and
Specifications are complete, Tenant’s architect and/or Contractor shall obtain
a building permit from the City of El Segundo for the portion of the Tenant Work
to which such Final Working Drawings and Specifications are applicable. Tenant
shall not commence construction or installation of the Tenant Work until all
necessary permits and approvals required for the construction and installation
of the Tenant Work have been obtained and a copy of all such permits, licenses,
and approvals has been provided to Landlord.

             3.          Construction

                           3.1        Tentative Construction Commencement
and Completion of Construction.

                           At
such time that Tenant’s architect and/or Contractor has obtained a building
permit and all other necessary approvals for construction of the Tenant Work
and Tenant and its Contractor(s) have delivered certificates of insurance for
the insurance required by this Work Letter Agreement, Tenant may commence construction
of the Tenant Work in accordance with the Final Working Drawings and
Specifications, and, once commenced, shall pursue the same diligently to
completion.  Promptly upon the
commencement of the Tenant Work, Tenant shall furnish Landlord with a revised
Tentative Construction Schedule setting forth the anticipated commencement date
and projected completion date of the Tenant Work.  Tenant shall give Landlord at least ten (10) days prior written
notice of commencement of any construction to enable Landlord to post in the
Building a notice of non-responsibility respecting the Tenant Work.  Tenant shall minimize any disturbance to
other tenants of the Project caused by such construction.  All work done in connection with the Tenant
Work shall be performed in compliance with the Project’s construction rules and
regulations and all applicable laws, ordinances, rules, orders, and regulations
of all federal, state, county and municipal governments or agencies and with
all directives, rules, and regulations of the fire marshal, health officer,
building inspector, or other proper officers of any governmental agency now
having or hereafter acquiring jurisdiction over the Premises.  In particular, Tenant shall, as part of the
Tenant Work, make any and all improvements to the Premises that are necessary
to cause the same to comply with the Americans With Disabilities Act and all
other regulations promulgated thereunder.

                           3.2        Building Systems.

                           If
any shutdown of plumbing or electrical equipment becomes necessary during the
course of construction of any of the Tenant Work, Tenant shall notify Landlord
and Landlord will determine when such shutdown may be made.  Landlord may require that any such shutdown
shall be made only if an agent or employee of Landlord is present.  Tenant shall repair any damage to the
Building or Project arising out of the construction of the Tenant Work to the
extent caused by Tenant, its agents, Contractor(s), subcontractors, or material
suppliers.  All such repairs shall be
made at Tenant’s sole cost and expense.

                           3.3        Inspections.

                           In
addition to any right of Landlord under the Lease and this Work Letter
Agreement to enter the Premises for the purpose of posting notices of
nonresponsibility, and the right of Landlord’s construction manager to enter
the Premises to supervise the Tenant Work, Landlord, its officers, agents,
and/or employees shall have the right upon reasonable notice at all reasonable
times during the construction period to enter upon the Premises and inspect the
Tenant Work to determine that the same is in conformity with the Final Working
Drawings and Specifications and all requirements of this Work Letter
Agreement.  The foregoing
notwithstanding, Landlord is under no obligation to supervise, inspect or
inform Tenant of the progress of construction and Tenant shall not rely upon
Landlord therefor.

                           3.4        Walk-Through of Tenant Improvements.

                           Within
ten (10) days following the completion of the Tenant Work (subject to minor
punchlist items), Tenant shall notify Landlord of the completion thereof and
shall provide Landlord an opportunity to inspect the same.  Within ten (10) days following Tenant’s
notice, Landlord (or its representative) shall walk-through and inspect the
Tenant Work, and shall either approve such work or advise Tenant in writing of
any defects or uncompleted items. Tenant shall promptly repair such defects or
uncompleted items to Landlord’s reasonable satisfaction.  Landlord’s approval of the Tenant Work, or
Landlord’s failure to advise Tenant of any defects or uncompleted items in the
Tenant Work, shall not relieve Tenant of responsibility for constructing and
installing the Tenant Work substantially in accordance with the Final Working
Drawings and Specifications, the Schedule of Values, this Work Letter Agreement,
and in conformance with all applicable laws, statutes and ordinances.

                           3.5        Completion of Tenant Improvements.

                           Upon
completion of the Tenant Work, Tenant shall: 
(a) obtain and deliver to Landlord a certificate of occupancy for
the Tenant Work from the governmental agency having jurisdiction thereof, if
applicable; (b) make available to Landlord receipted invoices (or invoices
with canceled checks attached) from Tenant’s Contractor(s) showing evidence of
full payment for such portion for the Tenant Work; (c) deliver to Landlord
a full set of reproducible as-built computer-aided-design (also known as “CAD”)
drawings for the Tenant Work (including all Change Orders) to the extent
applicable, including, without limitation, architectural drawings, structural
drawings, mechanical drawings, including plumbing, fire sprinkler, electrical
and life safety; (d) a copy of the building permit or permits for the Tenant
Work with final sign-off by the City of El Segundo; (e) complete
Landlord’s punch list items provided by Landlord to Tenant in accordance with
Section 3.4 above; and (f) deliver to Landlord copies of all written
construction and equipment warranties related to the portions of the Tenant
Work involving Building systems or those portions of the Premises Landlord is
required to maintain or repair under the Lease.  Tenant shall make such receipted invoices (or invoices with
canceled checks attached) from Tenant’s Contractor(s) available to Landlord for
a period of one (1) year following completion of the Tenant Work.

                           3.6        Protection Against Lien Claims.

                           Tenant
agrees to fully pay and discharge all claims for labor done and materials and
services furnished in connection with the construction of the Tenant Work, to
diligently file or procure the filing of a valid notice of completion within
twenty (20) days following completion of construction of the Tenant Work, to
diligently file or procure the filing of a notice of cessation upon a cessation
of labor of the Tenant Work for a continuous period of thirty (30) days or
more, and to take all steps to forestall the assertion of claims of lien
against the Project or any part thereof or right or interest appurtenant
thereto by contractors retained by Tenant in connection with the Tenant Work.  In the event that there shall be recorded
against the Premises or Building or the property of which the Premises is a
part any claim or lien arising out of the Tenant Work, and such claim or lien
shall not be removed from title or discharged within the time period specified
in Article 10 of the Lease, then Landlord may exercise its right to remove said
liens in accordance with Article 10 of the Lease.

                           3.7        Additional Work.  As part of the Tenant Work, Tenant shall
disconnect any supplemental heating, ventilating and air conditioning units
(“Supplemental HVAC Units”) located in the Premises that are currently
connected to condenser water system provided by NCR International, Inc. under
its sublease of the Premises and, if Tenant intends to use such Supplemental
HVAC Units during the Lease Term, to cause the same to be connected to the
condenser water system operated by Landlord. 
In addition, Tenant shall, as part of the Tenant Work, install a
synergistic meter to measure the electricity supplied to any such Supplemental
HVAC Units in the Premises.  Tenant
shall pay for electricity supplied to any Supplemental HVAC Units in accordance
with Article 11.2 of the Lease.

             4.          Allowance and Work Cost.

                           4.1        Allowance.

                           Subject
to the terms and conditions set forth in this Work Letter Agreement, Landlord
shall reimburse Tenant for Work Cost (defined below) incurred by Tenant in
constructing and installing the Tenant Work (as defined in this Work Letter
Agreement) in an amount not to exceed Two Hundred Seventy Thousand Six Hundred
Seventy-five Dollars ($270,675.00) ($7.50/rentable square foot x 36,090
rentable square feet) (the “Allowance”).

                           4.2        Work Cost.

                           “Work
Cost” means: (i) all design, architectural and engineering fees and
consultant fees incurred by Tenant and Landlord in connection with the
preparation, review and approval of the Space Plans and Working Drawings and
Final Working Drawings and Specifications, Schedule of Values, Work Cost
Estimate and Tentative Construction Schedule; (ii) governmental agency
plan check, permit and other fees; (iii) sales and other taxes;
(iv) Title 24 fees; (v) inspection costs; (vi) the actual costs and
charges for material and labor, Contractor’s profit and general overhead
incurred by Tenant for the Tenant Work and the Additional Work; and
(vii) Landlord’s construction manager’s fee.

                           4.3        Disbursement of Allowance.

                           Commencing
on June 1, 2002, Tenant may request disbursements from the Allowance.  Landlord shall not be obligated to make any
disbursements of the Allowance so long as an Event of Default by Tenant exists
under the Lease.  No disbursements shall
be made until the Final Working Drawings and Specifications, Tenant’s Work Cost
Estimate and Schedule of Values are approved by Landlord.  Each request for disbursement shall be accompanied
by:  (i) a written request for
disbursement itemizing each category of cost for which payment is requested, in
form and content reasonably acceptable to Landlord; (ii) conditional lien
releases, in a form and content satisfactory to Landlord, from all persons and
entities providing work or materials covered by such request;
(iii) unconditional lien releases from all persons or entities providing
work or materials who were paid out of the prior disbursement; and
(iv) invoices, vouchers, statements, affidavits and/or other documents in
a form reasonably acceptable to Landlord which substantiate and justify the
disbursement requested.  Within thirty
(30) days after Landlord’s receipt of each fully completed disbursement
request, Landlord shall pay ninety percent (90%) of the portion of the
Allowance sought to be disbursed (or one hundred percent (100%) of that amount
if the Tenant has requested only ninety percent (90%) of the value of the work
completed) directly to the Tenant, or to the Contractor(s) and the
subcontractors, laborers, or suppliers entitled thereto; provided, however,
Landlord reserves the right to reasonably disapprove some or all of the matters
disclosed by such disbursement request which are not items included within the
definition of Work Cost and to withhold the amounts relating to the disapproved
matters from the disbursement.  The ten
percent (10%) remaining after any of the above disbursements shall be paid by
Landlord within thirty-five (35) days after all of the following have occurred:
(i) Tenant has submitted a final request for disbursement in accordance
with the procedure set forth in this Section 4.3, (ii) a notice of
completion has been recorded with respect to the Tenant Work, and (iii) no
lien claim shall have been recorded within the thirty (30) day period following
such recordation (or if there be a lien claim, such lien shall have been
removed).  If the approved Schedule of
Values exceeds the Allowance, then each disbursement shall be in an amount
equal to the proportion of the Tenant Work completed and covered by the
disbursement request, as determined under the approved Schedule of Values,
multiplied by a fraction, the numerator of which is the Allowance, and the
denominator of which is the approved Schedule of Values.  In such event, Tenant shall pay to the
Contractor and all persons entitled thereto any portions of the Work Cost not
paid through the Allowance. 
Notwithstanding the foregoing, Landlord shall have no obligation to
disburse any amounts from the Allowance after December 1, 2002.

                           5.          Authorized Representatives.

                           Tenant
shall furnish Landlord with a written list of Tenant’s authorized construction
representatives for the Tenant Work. 
Only such construction representatives are authorized to execute Change
Orders or other documents on behalf of Tenant related to the Tenant Work, and
without the signature of such authorized construction representative, no such
document shall be binding upon Tenant. 
Tenant may from time to time change or add to the list of authorized
construction representatives by giving Landlord written notice of the addition
or change.

             6.          Indemnity and Insurance.

                           6.1        Indemnity.

                           Tenant shall
indemnify and hold harmless Landlord against any and all liability, claims,
mechanics liens, judgments, or demands, including demands arising from injuries
to or death of persons (Tenant’s employees, Tenant’s Contractor, employees of
Tenant’s Contractor(s) and employees of all subcontractors and
sub-subcontractors of Tenant’s Contractor included) and damage to property, or
any other loss, loss of rent, damage, or expense, arising directly or
indirectly out of the obligations herein undertaken or out of the operations
conducted by Tenant and/or its Contractor(s), subcontractors or
sub-subcontractors, including those in part due to the negligence of Landlord
save and except liability, claims, judgments or demands arising through the
sole negligence or sole willful misconduct of Landlord and will make good to
and reimburse Landlord for any expenditures, including actual attorneys’ fees,
which Landlord may incur by reason of such matters and, if requested by
Landlord will defend any such suits at the sole cost and expense of Tenant.

                           6.2        Insurance.

                           Tenant
shall, at its sole expense, be responsible for the securing of insurance by
Tenant’s Contractor and for the maintenance of same by Tenant’s Contractor
until completion and final acceptance of the work.  Certificates of insurance affording evidence of same shall be
obtained from Tenant’s Contractor by the Tenant and delivered to the Landlord
prior to the commencement of any work by Tenant’s Contractor.  The required insurance coverage is as
follows:

	 	1.	Worker’s
  Compensation and Employers’ Liability Insurance including coverage under the
  U.S. Longshoremen’s and Harborworkers’ Act and affording 30 days written
  notice of cancellation to Contractor. 
  The Employers’ Liability minimum limits required are as follows:

Bodily
Injury by accident        $100,000            each accident

Bodily Injury by disease          $500,000            policy limit

Bodily Injury by disease          $100,000            each employee

	 	2.	General
  Liability Insurance on an Occurrence basis for an amount of $5,000,000

  each occurrence and including the following coverage:

                                                     (a)         Premises and Operations coverage.

                                                     (b)        Owners and Contractors Protective
coverage.

                                                     (c)         Products and Completed Operations
coverage.

                                                     (d)        Blanket Contractual coverage, including
both oral and written contracts.

                                                     (e)         Personal Injury coverage.

                                                     (f)         Broad Form Property Damage coverage,
including completed operations.

                                                     (g)        An endorsement naming Landlord as
additional insured.

                                                     (h)        An endorsement affording 30 days written
notice to Landlord in event of cancellation

                                        or
material reduction in coverage.

                                                     (i)          An endorsement providing that such insurance
as is afforded under the policy of Tenant’s

                                         Contractor is primary insurance as respects
Landlord and that any other insurance maintained by Landlord is

                                         excess and noncontributing with the insurance
required hereunder.

             No
endorsement limiting or excluding a required coverage is permitted.  CLAIMS-MADE COVERAGE IS NOT ACCEPTABLE.

3.          Business Auto Liability Insurance for
an amount of $5,000,000 combined single limit for bodily injury and/or property
damage liability including:

                                                     (a)         Owned Autos,

                                                     (b)        Hired or Borrowed Autos,

                                                     (c)         Nonowned Autos, and

                                                     (d)        An endorsement affording 30 days written
notice of cancellation to Landlord in event of 

                                        cancellation
or material reduction in coverage.

A certificate and endorsements affording
evidence of the above requirements must be delivered to Landlord before
Tenant’s Contractor performs any work at or prepares or delivers materials to
the site of construction.

Tenant shall require its Contractor to
require its subcontractors to provide insurance where Tenant’s Contractor would
be required to carry insurance under this insurance section and to be
responsible for obtaining the appropriate certificates or other evidence of
insurance.

Tenant’s Contractor shall maintain all of
the foregoing insurance coverage in force until the work under this agreement
is fully completed and accepted except as to 2c (Products and Completed
Operation Coverage), which is to be maintained for one (1) year following  completion of the work and acceptance by
Landlord and Tenant.

All insurance, except Workers’
Compensation, maintained by Tenant’s Contractor and its subcontractors shall
preclude subrogation claims by the insurer against anyone insured thereunder.

The requirements for the foregoing
insurance shall not derogate from the provisions for indemnification of
Landlord by Tenant under the “indemnity” paragraph of this agreement.

If the Tenant fails to secure and
maintain the required insurance from Tenant’s Contractor, the Landlord shall
have the right (without any obligation to do so, however) to secure same in the
name and for the account of the Tenant’s Contractor(s) in which event Tenant
shall pay the cost thereof and shall furnish upon demand, all information that
may be required in connection therewith. 
Further, such failure to secure and maintain the required insurance
shall constitute a default under the Lease and Landlord shall be entitled to
immediately have all Tenant Work cease.

             7.          Miscellaneous

                           (a)         Tenant and Tenant’s Contractor shall
abide by all safety and construction rules and regulations of Landlord, and all
work and deliveries shall be scheduled through Landlord.  Entry by Tenant’s Contractor shall be deemed
to be under all the terms, covenants, provisions and conditions of said Lease
except the covenant to pay Basic Rental and Additional Rent.  All Tenant’s materials, work, installations
and decorations of any nature brought upon or installed in the Premises by
Tenant shall be at Tenant’s risk, and neither Landlord nor any party acting on
Landlord’s behalf shall be responsible for any damage thereto or loss or
destruction thereof.  Tenant shall award
its contracts and conduct its activities hereunder in a manner consistent with
Landlord’s contractor’s labor agreement affecting the Building.

                           (b)        Tenant shall reimburse Landlord for any
extra expenses incurred by Landlord by reason of faulty work done by Tenant or
its Contractor, or by reason of delays in such work caused by Tenant or its
Contractor, or by reason of cleanup which fails to comply with Landlord’s rules
and regulations.

                           (c)         Tenant’s Contractor shall not post any
signs other than those required by law in connection with the construction on
any part of the Project or Premises.

             8.          Incorporation.

             This
Work Letter Agreement is hereby incorporated into this Lease executed between
Landlord and Tenant concurrently herewith. 

	 	TENANT:	 
	 	 	 
	 	EN POINTE TECHNOLOGIES, INC.,

  a Delaware corporation	 
	 	 	 
	 	By:	 
	 	

	 
	 	Its:	 
	 	

	 
	 	By:	 
	 	

	 
	 	Its:	 
	 	

	 
				

 

 

	 	 	LANDLORD:
	 	 	 
	 	 	PACIFIC
  CORPORATE TOWERS LLC, a 

  Delaware limited liability company
	 	 	 
	 	 	By:
  GE Capital Investment Advisors, Inc., its
	 	 	manager
	 	 	 
	 	 	By:
	 	 	

	 
	 	 	Vice
  President
							

EXHIBIT
“D”

NOTICE
OF LEASE TERM DATES

	TO:	 
	 	

	 	

	 	

	 	

RE:       Standard Office Lease dated April  _, 2001 between PACIFIC CORPORATE TOWERS
LLC, a Delaware limited liability company (“Landlord”) and EN POINTE
TECHNOLOGIES, INC., a Delaware corporation (“Tenant”), concerning Suite 9__ on
the ninth (9th) floor and Suite 1900 on the Nineteenth (19th) floor
of the office building located at 100 N. Sepulveda Blvd., El Segundo,
California.

Dear Tenant:

             In
accordance with the Standard Office Lease (the “Lease”), we wish to advise you
and/or confirm as follows:

	 	1.	The
  Lease Term shall commence on or has commenced on July 1, 2001 for a term of
  five (5) years ending on June 30, 2006.
	 	2.	Rent
  commenced or will commence to accrue on July 1, 2001, in the amount of
  ________________.
	 	3.	If
  the Lease Commencement Date is other than the first day of the month, the
  first billing will contain a pro rata adjustment.  Each billing thereafter, with the exception of the final
  billing, shall be for the full amount of the monthly installment as provided
  for in the Lease.
	 	4.	Your
  rent checks should be made payable to ________________________ at
  _______________________________________.
	 	5.	The
  approximate number of rentable square feet within the Premises is thirty-six
  thousand ninety (36,090) square feet.

 

EXHIBIT
“E”

ERISA CERTIFICATE

             THIS
ERISA CERTIFICATE is made as of April ____, 2001, by EN POINTE TECHNOLOGIES,
INC., a Delaware corporation, having offices at 100 N. Sepulveda Boulevard,
Suite 1900, El Segundo, CA 90245 (“Lessee”), in favor of Pacific Corporate
Towers LLC, a Delaware limited liability company (“Lessor”) and The General
Motors Hourly Rate Employees Pension Trust and The General Motors Salaried
Pension Trust, its shareholder/interestholder, c/o GE Capital Investment
Advisors, Inc., 125 Summer Street, Suite 1270, Boston, MA 02110.

WITNESSETH:

             WHEREAS,
Lessor and Lessee anticipate entering into an Agreement for Lease (the “Lease
Agreement”), pursuant to which Lessor shall lease to Lessee, and Lessee shall
lease from Lessor, certain real property, known as and located at Suite 9___
and Suite 1900 100 North Sepulveda Boulevard, El Segundo, CA 90245.

             WHEREAS,
Lessor is in need of certain information regarding Lessee so that it may
proceed with the Lease Agreement.

             NOW,
THEREFORE, Lessee hereby certifies, represents, warrants and covenants to
Lessor that as of the date hereof:

             Representation
1.         Type of Lessee (check
applicable boxes)

             o         Lessee is not an “employee benefit
plan” (“Plan”) as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), which is subject to Title 1 of
ERISA.

             o         Lessee is not a “governmental plan”
within the meaning of Section 3(32) of ERISA.

             Representation
2.         Complete if Lessee is
not a Plan and Has Shareholders or Interestholders (check applicable boxes)

             One
or more of the following circumstances also is true:

             o         Equity interests in Lessee are publicly
offered securities within the meaning of 29 C.F.R. Section 2510.2-101(b)(2);

             o         Less than 25 percent of all equity
interests in Lessee are held by “benefit plan investors, ” which are defined
as: (i)  any employee benefit plan,
whether or not subject to Title 1 of ERISA; (ii)  any plan described in Section 4975(e)(1) of the Internal Revenue
Code of 1986, as amended; and (iii) any entity whose underlying assets include
plan assets by reason of a plan’s investment in the entity; or

             o         Lessee is a corporation that qualifies
as an “operating company,” a “venture capital operating company,” or a “real
estate operating company” within the meaning of 29 C.F.R. Section
1510.3-101(c), (d) and (e) (each, an “Operating Company”).

             Representation
3.         Lessee’s relation to
Lessor and Lessor’s Shareholders/Interestholders (check applicable boxes.)

             Lessee
is not a party in interest as defined in section 3(14) of ERISA with respect to
Lessor or its shareholders or interestholders, the General Motors Hourly Rate
Employees Pension Trust and the General Motors Salaried Pension Trust, because
Lessee is not:

             o         a fiduciary (including, but not limited
to, any administrator, officer, trustee or custodian), counsel, or employee of
Lessor or its shareholders or interestholders (“Fiduciary”);

             o         a person providing services to Lessor
or its shareholders or interestholders (“Service Provider”);

             o         an employer any of whose employees are
provided employment benefits by Lessor or its shareholders or interestholders
(“Employer”);

             o         an employee organization any of whose
members are provided employment benefits coverage by Lessor or its shareholders
or interestholders (“Employee Organization”);

             o         an owner, direct or indirect, of 50
percent or more of (i) the combined voting power of all classes of stock
entitled to vote or the total value of shares of all classes of stock of a
corporation, (ii) the capital interest or the profits interest of a
partnership, or (iii) the beneficial interest of a trust or unincorporated
enterprise, which is an Employer or an Employee Organization (“Owner”);

             o         a spouse, ancestor, lineal descendant,
or spouse of a lineal descendant of a Fiduciary, Service Provider, Employer, or
an Owner;

             o         a corporation, partnership, or trust or
estate of which (or in which) 50 percent or more of (i) the combined voting
power of all classes of stock entitled to vote or the total value of shares of
all classes of stock of such corporation, (ii) the capital interest or profits interest
of such partnership, or (iii) the beneficial interest of such trust or estate
is owned directly or indirectly, or held by a Fiduciary, Service Provider,
Employer, Employee Organization, or Owner (“Corporate Owner”);

             o         an employee, officer, director (or an
individual having powers or responsibilities similar to those of officers or
directors), or a 10 percent or more shareholder directly or indirectly, of a
Service Provider, Employer, Employee Organization, Owner, or a Corporate Owner;
or

             o         a 10 percent or more (directly or
indirectly in capital or profits) partner or joint venturer of a Service
Provider, Employer, Employee Organization, Owner, or a Corporate Owner.

             Representation 4.         Indemnity, Guaranty

             Lessee
shall indemnify Lessor and defend and hold Lessor harmless from and against all
loss, cost, damage and expense (including, without limitation, attorneys' fees
and costs incurred in the investigation, defense and settlement of claims and
losses incurred in correcting any prohibited transaction, and in obtaining any
individual prohibited transaction exemption under ERISA that may be required,
in Lessor's sole discretion) that Lessor may incur, directly or indirectly, as
a result of the Lessee’s representation contained in this certificate.

             Representation
5.         Survival

             Lessee
represents that the certifications, representations, warranties and covenants
contained herein shall remain true and correct throughout the term of the Lease
Agreement.

	 	EN POINTE TECHNOLOGIES, INC.,
	 	a
  Delaware corporation
	 	 
	 	 BY:

	 	 NAME:

	 	 ITS:

EXHIBIT
“F”

EXISTING FURNITURE

TABLE OF CONTENTS

	ARTICLE
  1.  BASIC LEASE PROVISIONS
	 	1.1  Term
	 
	ARTICLE 2.  TERM
	 
	ARTICLE
  3.  RENTAL
	 	3.1  Basic Rental
	 	3.2  Increase in Costs
	 	3.3  Definitions
	 	3.4  Determination of Payment
	 
	ARTICLE 4.  SECURITY DEPOSIT
	 
	ARTICLE
  5.  HOLDING OVER
	 
	ARTICLE 6.  PERSONAL PROPERTY
	 
	ARTICLE 7.  USE
	 
	ARTICLE 8.  CONDITION OF PREMISES
	 
	ARTICLE 9.  REPAIRS AND ALTERATIONS
	 
	ARTICLE
  10.  LIENS
	 
	ARTICLE 11.  PROJECT SERVICES
	 	11.1  Building Hours
	 	11.2  Electricity Use
	 	11.3  Heat Generating Machines
	 	11.4  After-Hours HVAC
	 	11.5  Recurrent Utility
  Use
	 
	ARTICLE 12.  RIGHTS OF LANDLORD
	 
	ARTICLE
  13.  INDEMNITY, EXEMPTION OF LANDLORD
  FROM LIABILITY
	 	13.1  Indemnity
	 	13.2  Exemption of Landlord from Liability
	 
	ARTICLE
  14.  INSURANCE
	 	14.1  Tenant's Insurance
	 	14.2  Form of Policies
	 	14.3  Landlord's Insurance
	 	14.4  Waiver of Subrogation
	 	14.5  Compliance with Law
	 
	ARTICLE
  15.  ASSIGNMENT AND SUBLETTING
	 
	ARTICLE 16.  DAMAGE OR DESTRUCTION
	 
	ARTICLE 17.  SUBORDINATION
	 
	ARTICLE 18.  EMINENT DOMAIN
	 
	ARTICLE 19.  DEFAULT
	 
	ARTICLE 20.  REMEDIES
	 
	ARTICLE
  21.  TRANSFER OF LANDLORD'S INTEREST
	 
	ARTICLE
  22.  BROKERS
	 
	ARTICLE
  23.  PARKING
	 
	ARTICLE 24.  WAIVER
	 
	ARTICLE
  25.  ESTOPPEL CERTIFICATE
	 
	ARTICLE 26.  LIABILITY OF LANDLORD
	 
	ARTICLE 27.  INABILITY TO PERFORM
	 
	ARTICLE 28.  HAZARDOUS MATERIALS
	 	28.1  Environmental Law Compliance
	 	28.2  Prohibition
	 	28.3  Indemnity
	 	28.4  Definitions
	 
	ARTICLE
  29.  SURRENDER OF PREMISES; REMOVAL OF
  PROPERTY
	 	29.1  No Merger
	 	29.2  Surrender
	 	29.3  Disposition of Personal Property
	 	29.4  Removal of Alterations
	 
	ARTICLE
  30.  MISCELLANEOUS
	 	30.1  Mortgage Protection
	 	30.2  Recording
	 	30.3  Financial Statements
	 	30.4  Severability; Entire Agreement
	 	30.5  Attorneys' Fees
	 	30.6  Time of Essence
	 	30.7  Headings
	 	30.8  Reserved Area
	 	30.9  No Option
	 	30.10  Use of Project Name; Improvements
	 	30.11  Rules and Regulations
	 	30.12  Quiet Possession
	 	30.13  Additional Rent
	 	30.14  Substitute Premises
	 	30.15  Successors and Assigns
	 	30.16  Notices
	 	30.17  Persistent Delinquencies
	 	30.18  Right of Landlord to Perform
	 	30.19  Access, Changes in Project, Facilities,
  Name
	 	30.20  Corporate Authority
	 	30.21  Identification of Tenant
	 	30.22  Building Codes
	 	30.23  Transportation and Energy Management
	 	30.24  ERISA Certificate
	 	30.25  Exhibits
	 	30.26  Waiver of Jury Trial
	 
	ARTICLE 31.  OPTION TO EXTEND
	 	31.1  Grant of Option
	 	31.2  Determination of Prevailing Market Rental
	 
	ARTICLE
  32.  SIGNAGEPrepared by MerrillDirect

Exhibit 10.13

2001
STOCK INCENTIVE PLAN

OF

MTR GAMING GROUP, INC.

             1.          PURPOSES OF THE PLAN. This stock
incentive plan (the "Plan") is designed to provide an incentive to
key employees (including directors and officers who are key employees) and to
consultants and directors who are not employees of MTR GAMING GROUP, INC., a
Delaware corporation (the "Company"), or any of its Subsidiaries (as
defined in Paragraph 17), and to offer an additional inducement in obtaining
the services of such persons. The Plan provides for the grant of nonqualified
stock options ("NQSOs") which do not qualify as incentive stock
options within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the “Code”), and stock of the Company which may be subject to contingencies
or restrictions (collectively, "Awards"). The Plan does not provide
for the granting of any "incentive stock option" under the Code.

             2.          STOCK SUBJECT TO THE PLAN. Subject to
the provisions of Paragraph 10, the aggregate number of shares of Common Stock,
$.0001 par value per share, of the Company ("Common Stock") for which
Awards may be granted under the Plan shall not exceed 490,000 shares, provided,
however, that not more than 49% of such shares may be issued to Directors and
Executive Officers of the Company. Such shares of Common Stock may, in the
discretion of the Board of Directors of the Company (the "Board of
Directors"), consist either in whole or in part of authorized but unissued
shares of Common Stock or shares of Common Stock held in the treasury of the
Company. Subject to the provisions of Paragraph 11, any shares of Common Stock
subject to an option which for any reason expires, is canceled or is terminated
unexercised or which ceases for any reason to be exercisable or a restricted
stock Award which for any reason is forfeited, shall again become available for
the granting of Awards under the Plan. The Company shall at all times during
the term of the Plan reserve and keep available such number of shares of Common
Stock as will be sufficient to satisfy the requirements of the Plan.

             3.          ADMINISTRATION OF THE PLAN. The Plan
shall be administered by the Board of Directors or a committee of the Board of
Directors consisting of not less than two directors, each of whom shall be a
"non-employee director" within the meaning of Rule 16b-3 (as defined
in Paragraph 17) (collectively, the "Committee"). Unless otherwise
provided in the By-laws of the Company or by resolution of the Board of
Directors, a majority of the members of the Committee shall constitute a
quorum, and the acts of a majority of the members present at any meeting at
which a quorum is present, and any acts approved in writing by all members
without a meeting, shall be the acts of the Committee. Subject to the express
provisions of the Plan, the Committee shall have the authority, in its sole
discretion, to determine: the key employees, consultants and directors who
shall be granted Awards; the type of Award to be granted; the times when an
Award shall be granted; the number of shares of Common Stock to be subject to
each Award; the term of each option; the date each option shall become
exercisable; whether an option shall be exercisable in whole or in installments
and, if in installments, the number of shares of Common Stock to be subject to
each installment, whether the installments shall be cumulative, the date each
installment shall become exercisable and the term of each installment; whether
to accelerate the date of exercise of any option or installment thereof;
whether shares of Common Stock may be issued upon the exercise of an option as
partly paid and, if so, the dates when future installments of the exercise
price shall become due and the amounts of such installments; the exercise price
of each option; the price, if any, to be paid for a share Award; the form of
payment of the exercise price of an option; whether to restrict the sale or
other disposition of a stock Award or the shares of Common Stock acquired upon
the exercise of an option and, if so, to determine whether such contingencies
and restrictions have been met and whether and under what conditions to waive
any such contingency or restriction; whether and under what conditions to
subject all or a portion of the grant or exercise of an option, the vesting of
a stock Award or the shares acquired pursuant to the exercise of an option to
the fulfillment of certain contingencies or restrictions as specified in the
contract referred to in Paragraph 9 hereof (the "Contract"),
including without limitation, contingencies or restrictions relating to
entering into a covenant not to compete with the Company, any of its
Subsidiaries or a Parent (as defined in Paragraph 17), to financial objectives
for the Company, any of its Subsidiaries or a Parent, a division of any of the
foregoing, a product line or other category, and/or to the period of continued
employment of the Award holder with the Company, any of its Subsidiaries or a
Parent, and to determine whether such contingencies or restrictions have been
met; whether an Award holder is Disabled (as defined in Paragraph 17); the
amount, if any, necessary to satisfy the obligation of the Company, a
Subsidiary or Parent to withhold taxes or other amounts; the Fair Market Value
(as defined in Paragraph 17) of a share of Common Stock; to construe the
respective Contracts and the Plan; with the consent of the Award holder, to
cancel or modify an Award, PROVIDED, that the modified provision is permitted
to be included in an Award granted under the Plan on the date of the
modification; to prescribe, amend and rescind rules and regulations relating to
the Plan; to approve any provision which under Rule 16b-3 requires the approval
of the Board of Directors, a committee of non-employee directors or the
stockholders to be exempt (unless otherwise specifically provided herein); and
to make all other determinations necessary or advisable for administering the
Plan. Any controversy or claim arising out of or relating to the Plan, any
Award granted under the Plan or any Contract shall be determined unilaterally
by the Committee in its sole discretion. The determinations of the Committee on
the matters referred to in this Paragraph 3 shall be conclusive and binding on
the parties. No member or former member of the Committee shall be liable for any
action, failure to act or determination made in good faith with respect to the
Plan or any Award or Contract hereunder. Prior to the creation and designation
of the Committee by the Board of Directors, all powers and authority allocated
hereby to the Committee shall be allocated to the Board of Directors and all
references to the Committee shall be deemed to be references to the Board of
Directors.  Notwithstanding any
provision in the Plan to the contrary, an Award granted to a consultant or
director who is not an employee of the Company shall be based upon a formula or
other criteria established by the Committee at least ninety (90) days prior to
the grant of such Award.

             4.          OPTIONS

                           (a)         GRANT. The Committee may from time to
time, consistent with the purposes of the Plan, grant options to such key
employees (including officers and directors who are key employees) of, and
consultants to, the Company or any of its Subsidiaries, and such Outside
Directors, as the Committee may determine, in its sole discretion. Such options
granted shall cover such number of shares of Common Stock as the Committee may
determine, in its sole discretion, as set forth in the applicable Contract;
PROVIDED, HOWEVER, THAT THE MAXIMUM NUMBER OF SHARES SUBJECT TO OPTIONS THAT
MAY BE GRANTED TO ANY EMPLOYEE DURING ANY CALENDAR YEAR UNDER THE PLAN (THE
"162(M) MAXIMUM") SHALL BE 350,000 SHARES.

                           (b)        EXERCISE PRICE. The exercise price of
the shares of Common Stock under each option shall be determined by the
Committee, in its sole discretion, as set forth in the applicable
Contract.  Notwithstanding any provision
in this Plan to the contrary, the exercise price per share of a NQSO shall not
be less than the Fair Market Value of a share of Common Stock on the date that
the NQSO was granted or, if the NQSO was repriced pursuant to Paragraph 4(f),
the date that the NQSO was repriced.

                           (c)         TERM. The term of each option granted
pursuant to the Plan shall be determined by the Committee, in its sole
discretion, and set forth in the applicable Contract.  Options shall be subject to earlier termination as hereunder
provided.

                           (d)        EXERCISE. An option (or any part or
installment thereof), to the extent then exercisable, shall be exercised by
giving written notice to the Company at its then principal office stating which
option is being exercised, specifying the number of shares of Common Stock as
to which such option is being exercised and accompanied by payment in full of
the aggregate exercise price therefor (or the amount due upon exercise if the
Contract permits installment payments) (a) in cash or by certified check or (b)
if the applicable Contract permits, with previously acquired shares of Common
Stock having an aggregate Fair Market Value on the date of exercise equal to
the aggregate exercise price of all options being exercised, or with any
combination of cash, certified check or shares of Common Stock having such
value. The Company shall not be required to issue any shares of Common Stock
pursuant to any such option until all required payments, including any required
withholding, have been made.

             The
Committee may, in its sole discretion, permit payment of all or a portion of
the exercise price of an option by delivery by the optionee of a properly
executed notice, together with a copy of his irrevocable instructions to a
broker acceptable to the Committee to deliver promptly to the Company the
amount of sale or loan proceeds sufficient to pay such exercise price. In
connection therewith, the Company may enter into agreements for coordinated
procedures with one or more brokerage firms.

             An
optionee entitled to receive Common Stock upon the exercise of an option shall
not have the rights of a stockholder with respect to such shares of Common
Stock until the date of issuance of a stock certificate for such shares or, in
the case of uncertificated shares, until an entry is made on the books of the
Company's transfer agent representing such shares; PROVIDED, HOWEVER, that
until such stock certificate is issued or book entry is made, any optionee using
previously acquired shares of Common Stock in payment of an option exercise
price shall continue to have the rights of a stockholder with respect to such
previously acquired shares.

             In
no case may an option be exercised with respect to a fraction of a share of
Common Stock. In no case may a fraction of a share of Common Stock be purchased
or issued under the Plan.

                           (e)         RELOAD OPTIONS. An optionee who, at a
time when he is eligible to be granted options under the Plan, uses previously
acquired shares of Common Stock to exercise an option granted under the Plan
(the "prior option"), shall, upon such exercise, be automatically
granted an option (the "reload option") to purchase the same number
of shares of Common Stock so used (or if there is not a sufficient number of
shares available for grant under the Plan remaining, such number of shares as
are then available). Such reload options shall be of the same type and have the
same terms as the prior option (except to the extent inconsistent with the terms
of the Plan); PROVIDED, HOWEVER, that the exercise price per share of the
reload option shall be equal to the Fair Market Value of a share of Common
Stock on the date of grant of the reload option.

                           (f)         REPRICING.  In the event that the Committee determines that it would be in
the best interest of the Company and consistent with the purposes of the Plan,
the Committee may reduce the exercise price of previously granted NQSOs; provided,
however, that such repricing by the Committee pursuant to this Paragraph
4(f) shall be limited to not more than ten percent (10%) of the number of
options then outstanding under the Plan.

             5.          RESTRICTED STOCK. The Committee may
from time to time, consistent with the purposes of the Plan, grant shares of
Common Stock to such key employees (including officers and directors who are
key employees) of, or consultants to, the Company or any of its Subsidiaries,
as the Committee may determine, in its sole discretion. The grant may cover
such number of shares as the Committee may determine, in its sole discretion,
and require the Award holder to pay such price per share therefor, if any, as
the Committee may determine, in its sole discretion. Such shares may be subject
to such contingencies and restrictions as the Committee may determine, as set
forth in the Contract. Upon the issuance of the stock certificate for a share
Award, or in the case of uncertificated shares, the entry on the books of the
Company's transfer agent representing such shares, notwithstanding any
contingencies or restrictions to which the shares are subject, the Award holder
shall be considered to be the record owner of the shares, and subject to the
contingencies and restrictions set forth in the Award, shall have all rights of
a stockholder of record with respect to such shares, including the right to
vote and to receive distributions. Upon the occurrence of any such contingency
or restriction, the Award holder may be required to forfeit all or a portion of
such shares back to the Company. The shares shall vest in the Award holder when
all of the restrictions and contingencies lapse. Accordingly, the Committee may
require that such shares be held by the Company, together with a stock power
duly endorsed in blank by the Award holder, until the shares vest in the Award
holder.  Contracts with respect to the
grant of shares of Common Stock shall require that the Award holder agree not
to transfer the Common Stock for (a) one year following the grant in the case
of Awards based on performance and (b) three years following the grant in the
case of Awards based on the passage of time. 
The Contracts may provide for the waiver of  this restriction in the event of death, disability, retirement,
change of control or other similar circumstances specified by the Committee.

             6.          TERMINATION OF RELATIONSHIP. Except as
may otherwise be expressly provided in the applicable Contract, if an Award
holder's relationship with the Company, its Subsidiaries and Parent as an
employee or a consultant has terminated for any reason (other than as a result
of his death or Disability), the Award holder may exercise the options granted
to him as an employee of, or consultant to, the Company or any of its
Subsidiaries, to the extent exercisable on the date of such termination, at any
time within three months after the date of termination, but not thereafter and
in no event after the date the Award would otherwise have expired; PROVIDED,
HOWEVER, that if such relationship is terminated either (a) for Cause (as
defined in Paragraph 17), or (b) without the consent of the Company, such
option shall terminate immediately; and PROVIDED FURTHER that in the event an
employee's employment is terminated in connection with a change in control of
the Company, then the employee will have the right to exercise the option until
the date the award otherwise would have expired.

                           For
the purposes of the Plan, an employment relationship shall be deemed to exist
between an individual and the Company, any of its Subsidiaries or a Parent if,
at the time of the determination, the individual was an employee of such
corporation for purposes of Section 422(a) of the Code. As a result, an
individual on military, sick leave or other bona fide leave of absence shall
continue to be considered an employee for purposes of the Plan during such
leave if the period of the leave does not exceed 90 days, or, if longer, so
long as the individual's right to reemployment with the Company, any of its
Subsidiaries or a Parent is guaranteed either by statute or by contract. If the
period of leave exceeds 90 days and the individual's right to reemployment is
not guaranteed by statute or by contract, the employment relationship shall be
deemed to have terminated on the 91st day of such leave.

                           Except
as may otherwise be expressly provided in the applicable Contract, options
granted under the Plan shall not be affected by any change in the status of the
Award holder so long as he continues to be an employee of, or a consultant to,
the Company, or any of its Subsidiaries or a Parent (regardless of having
changed from one to the other or having been transferred from one corporation
to another).

                           Except
as may otherwise be expressly provided in the applicable Contract, if an Award
holder's relationship with the Company as an Outside Director ceases for any
reason (other than as a result of his death or Disability) then options granted
to such holder as an Outside Director may be exercised, to the extent
exercisable on the date of such termination, at any time within three months
after the date of termination, but not thereafter and in no event after the
date the Award would otherwise have expired; PROVIDED, HOWEVER, that if such
relationship is terminated for Cause, such Award shall terminate immediately.
An Award granted to an Outside Director, however, shall not be affected by the
Award holder becoming an employee of, or consultant to, the Company, any of its
Subsidiaries or a Parent.

                           Except
as may otherwise be expressly provided in the Contract, upon the termination of
the relationship of an Award holder as an employee of, or consultant to, the
Company, and its Subsidiaries and Parent, or as an Outside Director, for any
reason (including his death or Disability), the share Award shall cease any
further vesting and the unvested portion of such Award as of the date of such
termination shall be forfeited to the Company for no consideration.

                           Nothing
in the Plan or in any Award granted under the Plan shall confer on any Award
holder any right to continue in the employ of, or as a consultant to, the Company,
any of its Subsidiaries or a Parent, or as a director of the Company, or
interfere in any way with any right of the Company, any of its Subsidiaries or
a Parent to terminate the Award holder's relationship at any time for any
reason whatsoever without liability to the Company, any of its Subsidiaries or
a Parent.

             7.          DEATH OR DISABILITY. Except as may
otherwise be expressly provided in the applicable Contract, if an Award holder
dies (a) while he is an employee of, or consultant to, the Company, any of its
Subsidiaries or a Parent, (b) within three months after the termination of such
relationship (unless such termination was for Cause or without the consent of
the Company), or (c) within one year following the termination of such
relationship by reason of his Disability, the options that were granted to him
as an employee of, or consultant to, the Company or any of its Subsidiaries,
may be exercised, to the extent exercisable on the date of his death, by his
Legal Representative (as defined in Paragraph 17) at any time within one year
after death, but not thereafter and in no event after the date the option would
otherwise have expired.

                           Except
as may otherwise be expressly provided in the applicable Contract, if an Award
holder's relationship as an employee of, or consultant to, the Company, any of
its Subsidiaries or a Parent has terminated by reason of his Disability, the
options that were granted to him as an employee of, or consultant to the
Company or any of its Subsidiaries may be exercised, to the extent exercisable
upon the effective date of such termination, at any time within one year after
such date, but not thereafter and in no event after the date the option would
otherwise have expired.

                           Except
as may otherwise be expressly provided in the applicable Contract, if an Award
holder's relationship as an Outside Director terminates as a result of his
death or Disability, the options granted to him as an Outside Director may be
exercised, to the extent exercisable on the date of such termination, at any
time within one year after the date of termination, but not thereafter and in
no event after the date the Award would otherwise have expired. In the case of
the death of the Award holder, the Award may be exercised by his Legal
Representative.

             8.          COMPLIANCE WITH SECURITIES LAWS. It is
a condition to the issuance of any share Award and exercise of any option that
either (a) a Registration Statement under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the shares of Common
Stock to be issued upon such grant or exercise shall be effective and current
at the time of exercise, or (b) there is an exemption from registration under
the Securities Act for the issuance of the shares of Common Stock upon such
exercise. Nothing herein shall be construed as requiring the Company to
register shares subject to any Award under the Securities Act or to keep any
Registration Statement effective or current.

                           The
Committee may require, in its sole discretion, as a condition to the receipt of
an Award or the exercise of any option that the Award holder execute and
deliver to the Company his representations and warranties, in form, substance
and scope satisfactory to the Committee, which the Committee determines are
necessary or convenient to facilitate the perfection of an exemption from the
registration requirements of the Securities Act, applicable state securities
laws or other legal requirement, including, without limitation, that (a) the
shares of Common Stock to be received under the Award or issued upon the
exercise of the option are being acquired by the Award holder for his own
account, for investment only and not with a view to the resale or distribution
thereof, and (b) any subsequent resale or distribution of shares of Common Stock
by such Award holder will be made only pursuant to (i) a Registration Statement
under the Securities Act which is effective and current with respect to the
shares of Common Stock being sold, or (ii) a specific exemption from the
registration requirements of the Securities Act, but in claiming such
exemption, the Award holder shall prior to any offer of sale or sale of such
shares of Common Stock provide the Company with a favorable written opinion of
counsel satisfactory to the Company, in form, substance and scope satisfactory
to the Company, as to the applicability of such exemption to the proposed sale
or distribution.

                           In
addition, if at any time the Committee shall determine, in its sole discretion,
that the listing or qualification of the shares of Common Stock subject to any
Award or option on any securities exchange, Nasdaq or under any applicable law,
or the consent or approval of any governmental agency or regulatory body, is
necessary or desirable as a condition to, or in connection with, the granting
of an Award or the issuing of shares of Common Stock thereunder, such Award may
not be granted and such option may not be exercised in whole or in part unless
such listing, qualification, consent or approval shall have been effected or
obtained free of any conditions not acceptable to the Committee.

             9.          AWARD CONTRACTS. Each Award shall be
evidenced by an appropriate Contract which shall be duly executed by the
Company and the Award holder, and shall contain such terms, provisions and
conditions not inconsistent herewith as may be determined by the Committee. The
terms of each Award and Contract need not be identical.

             10.        ADJUSTMENTS UPON CHANGES IN COMMON
STOCK. Notwithstanding any other provision of the Plan, in the event of a stock
dividend, recapitalization, merger in which the Company is the surviving
corporation, spin-off, split-up, combination or exchange of shares or the like
which results in a change in the number or kind of shares of Common Stock which
is outstanding immediately prior to such event, the aggregate number and kind
of shares subject to the Plan, the aggregate number and kind of shares subject
to each outstanding Award, the exercise price of each option, any contingencies
and restrictions based on the number or kind of shares, and the 162(m) Maximum
shall be appropriately adjusted by the Board of Directors, whose determination
shall be conclusive and binding on all parties. Such adjustment may provide for
the elimination of fractional shares which might otherwise be subject to Awards
without payment therefor.

                           In
the event of (a) the liquidation or dissolution of the Company, (b) a merger in
which the Company is not the surviving corporation or a consolidation, or (c)
any transaction (or series of related transactions) in which (i) more than 50%
of the outstanding Common Stock is transferred or exchanged for other
consideration, or (ii) shares of Common Stock in excess of the number of shares
of Common Stock outstanding immediately preceding the transaction are issued
(other than to stockholders of the Company with respect to their shares of
stock in the Company), any outstanding options and unvested stock shall
terminate upon the earliest of any such event, unless other provision is made
therefor in the transaction.

             11.        AMENDMENTS AND TERMINATION OF THE PLAN.
The Plan was adopted by the Board of Directors on May 1, 2001. The Board of
Directors may at any time suspend or terminate the Plan, in whole or in part,
or amend it from time to time in such respects as it may deem advisable,
including, without limitation, in order to comply with the provisions of Rule
16b-3, Section 162(m) of the Code, or any change in applicable law,
regulations, rulings or interpretations of any governmental agency or
regulatory body. No termination, suspension or amendment of the Plan shall
adversely affect the rights of any Award holder under an Award without his
prior consent. The power of the Committee to construe and administer any Awards
granted under the Plan prior to the termination or suspension of the Plan
nevertheless shall continue after such termination or during such suspension.

             12.        NON-TRANSFERABILITY. No option granted
under the Plan shall be transferable otherwise than by will or the laws of
descent and distribution, and options may be exercised, during the lifetime of
the Award holder, only by him or his Legal Representatives. Except as may
otherwise be expressly provided in the Contract, a stock Award, to the extent
not vested, shall not be transferable otherwise than by will or the laws of
descent and distribution. Except to the extent provided above, Awards may not
be assigned, transferred, pledged, hypothecated or disposed of in any way
(whether by operation of law or otherwise) and shall not be subject to
execution, attachment or similar process, and any such attempted assignment,
transfer, pledge, hypothecation or disposition shall be null and void AB INITIO
and of no force or effect; PROVIDED, HOWEVER, that a contract may provide that
non-qualified Awards may be donated to charity or assigned to a family trust or
similar estate planning vehicle.

             13.        WITHHOLDING TAXES. The Company, a
Subsidiary or Parent may withhold (a) cash, or (b) with the consent of the
Committee, shares of Common Stock to be issued under a stock Award or upon
exercise of an option having an aggregate Fair Market Value on the relevant
date, or a combination of cash and shares having such value, in an amount equal
to the amount which the Committee determines is necessary to satisfy the
obligation of the Company, any of its Subsidiaries or a Parent to withhold
federal, state and local taxes or other amounts incurred by reason of the
grant, vesting, exercise or disposition of an Award, or the disposition of the
underlying shares of Common Stock. Alternatively, the Company may require the
holder to pay to the Company such amount, in cash, promptly upon demand.

             14.        LEGENDS; PAYMENT OF EXPENSES. The
Company may endorse such legend or legends upon the certificates for shares of
Common Stock issued under a stock Award or upon exercise of an option under the
Plan and may issue such "stop transfer" instructions to its transfer
agent in respect of such shares as it determines, in its discretion, to be
necessary or appropriate to (a) prevent a violation of, or to perfect an exemption
from, the registration requirements of the Securities Act and any applicable
state securities laws, or (b) implement the provisions of the Plan or any
agreement between the Company and the Award holder with respect to such shares
of Common Stock.

                           The
Company shall pay all issuance taxes with respect to the issuance of shares of
Common Stock under a stock Award or upon the exercise of an option granted
under the Plan, as well as all fees and expenses incurred by the Company in
connection with such issuance.

             15.        USE OF PROCEEDS. The cash proceeds
received upon the exercise of an option, or grant of a stock Award under the
Plan shall be added to the general funds of the Company and used for such
corporate purposes as the Board of Directors may determine.

             16.        SUBSTITUTIONS AND ASSUMPTIONS OF AWARDS
OF CERTAIN CONSTITUENT CORPORATIONS. Anything in this Plan to the contrary
notwithstanding, the Board of Directors may, without further approval by the
stockholders, substitute new Awards for prior options, or restricted stock of a
Constituent Corporation (as defined in Paragraph 17) or assume the prior
options or restricted stock of such Constituent Corporation.

             17.
DEFINITIONS. For purposes of the Plan, the following terms shall be defined as
set forth below:

                           (a)         "Cause" shall mean: (i) in
the case of an employee or consultant, if there is a written employment or
consulting agreement between the Award holder and the Company, any of its
Subsidiaries or a Parent which defines termination of such relationship for
cause, cause as defined in such agreement, and (ii) in all other cases, cause
as defined by applicable state law.

                           (b)        "Constituent Corporation"
shall mean any corporation which engages with the Company, any of its
Subsidiaries or a Parent in a transaction to which Section 424(a) of the Code
applies, or any Subsidiary or Parent of such corporation.

                           (c)         "Disability" shall mean a
permanent and total disability within the meaning of Section 22(e)(3) of the
Code.

                           (d)        "Exchange Act" means the
Securities Exchange Act of 1934, as amended.

                           (e)         "Fair Market Value" of a
share of Common Stock on any day shall mean: (i) if the principal market for
the Common Stock is a national securities exchange, the average of the highest
and lowest sales prices per share of Common Stock on such day as reported by
such exchange or on a composite tape reflecting transactions on such exchange,
(ii) if the principal market for the Common Stock is not a national securities
exchange and the Common Stock is quoted on Nasdaq, and (A) if actual sales
price information is available with respect to the Common Stock, the average of
the highest and lowest sales prices per share of Common Stock on such day on
Nasdaq, or (B) if such information is not available, the average of the highest
bid and lowest asked prices per share of Common Stock on such day on Nasdaq, or
(iii) if the principal market for the Common Stock is not a national securities
exchange and the Common Stock is not quoted on Nasdaq, the average of the
highest bid and lowest asked prices per share of Common Stock on such day as
reported on the OTC Bulletin Board Service or by National Quotation Bureau,
Incorporated or a comparable service; PROVIDED, HOWEVER, that if clauses (i),
(ii) and (iii) of this subparagraph are all inapplicable, or if no trades have
been made or no quotes are available for such day, the Fair Market Value of a
share of Common Stock shall be determined by the Board of Directors by any
method consistent with applicable regulations adopted by the Treasury Department
relating to stock options.

                           (f)         "Legal Representative" shall
mean the executor, administrator or other person who at the time is entitled by
law to exercise the rights of a deceased or incapacitated optionee with respect
to an option granted under the Plan.

                           (g)        "Nasdaq" shall mean the Nasdaq
Stock Market.

                           (h)        "Outside Director" shall mean
a person who is a director of the Company, but on the date of grant is not an
employee of, or consultant to, the Company, any of its Subsidiaries or a Parent.

                           (i)          "Parent" shall have the same
definition as "parent corporation" in Section 424(e) of the Code.

                           (j)          "Rule 16b-3" shall mean Rule
16b-3 promulgated under the Exchange Act, as the same may be in effect and
interpreted from time to time.

                           (k)         "Subsidiary" shall have the
same definition as "subsidiary corporation" in Section 424(f) of the
Code.

             18.        GOVERNING LAW; CONSTRUCTION. The Plan,
the Awards and Contracts hereunder and all related matters shall be governed
by, and construed in accordance with, the laws of the State of Delaware,
without regard to conflict of law provisions that would defer to the
substantive laws of another jurisdiction.

                           Neither
the Plan nor any Contract shall be construed or interpreted with any
presumption against the Company by reason of the Company causing the Plan or
Contract to be drafted. Whenever from the context it appears appropriate, any
term stated in either the singular or plural shall include the singular and
plural, and any term stated in the masculine, feminine or neuter gender shall
include the masculine, feminine and neuter.

             19.        PARTIAL INVALIDITY. The invalidity,
illegality or unenforceability of any provision in the Plan, any Award or
Contract shall not affect the validity, legality or enforceability of any other
provision, all of which shall be valid, legal and enforceable to the fullest
extent permitted by applicable law.

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