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EXHIBIT 10.11    
  

 
 

Office Lease Between Robert Sarno, Trustee and Frances
  Sarno, Trustee and Pacific Crest Bank, dated December 31,
  1997 (Encino Branch)    
  

 

	Pacific Crest Lease	 	Lessor	 	RS
	 	Lessee	 	[ILLEGIBLE]

 
 

LEASE AGREEMENT    
  

1.  PARTIES  This Lease Agreement is made and entered into this 31 day of December, 1997 by and between ROBERT
SARNO, TRUSTEE and FRANCES SARNO, TRUSTEE (hereinafter collectively referred to as "Lessor"), and PACIFIC CREST BANK (hereinafter referred to as "Lessee"). 

2.  PREMISES  Lessor hereby leases to Lessee and Lessee hereby leases from Lessor, on the terms and conditions hereinafter
set forth, the premises located at 17656 Ventura Blvd, Encino, California (hereinafter collectively referred to as the "Premises"). 

3.  TERM  The term of this Lease shall be for a period of one hundred and twenty (120) months, commencing on
January 1, 1998 and terminating on December 31, 2007. 

4.  RENT  Lessee agrees to pay to Lessor the following minimum monthly rent during the term of the Lease: 

    4.1    Commencing
on January 1, 1998 through December 31, 2007, the sum of Six Thousand Three Hundred Dollars ($6,300.00) per month, payable on the first
day of each month without notice or demand; 

    4.2    For
the period commencing January 1, 1998 and continuing through December 31, 2007, Lessee agrees that the minimum monthly rental of $6300.00 shall be
adjusted upwards annually by the same percentage that the Consumer Price Index increases from January of the preceding year to January of the year in which the annual adjustment is to be made, however
said adjustment shall not exceed four percent (4%) per annum. Said monthly rent shall be payable on the first day of each month without notice or demand. In no event, however, shall the minimum
monthly rental after an annual adjustment ever be less than the minimum monthly rental that was due and payable in the month immediately before the adjustment. 

    4.3    For
the purposes of calculating rental adjustment, the Consumer Price Index which shall be used is the Consumer Price Index for Urban Wage Earner's and Clerical
Workers (CPI-W) as promulgated by the Bureau of Labor Statistics of the United States Department of Labor, using the year 1967 as a base of 100. 

    4.4    During
the one hundred and twenty (120) month term of this lease, Lessee shall be entitled to a rent abatement of One Thousand Dollars ($1,000) per month
which shalt be deducted from the then applicable monthly rent which is due under this lease. This rent abatement constitutes a total tenant improvement rent discount of $120,000.00 which has been pro
rated over the one hundred and twenty month term of the lease. Notwithstanding the other provisions of this subparagraph 4.4, Lessee's continuing entitlement to the full rental abatement during
the term of this lease as set forth in this subparagraph 4.4 shall be strictly contingent upon Lessee investing a minimum of $81,225,00 on the refurbishing or remodeling of the premises (such
investment shall include the costs of planning/design,
etc.) by no later than January 1, 1999. In the event that Lessee has not invested the full $81,225.00 on refurbishing or remodeling of the premises, then the scheduled monthly abatement of
$1,000 per month shall be decreased in the same ratio as the actual amount which Lessee has invested bears to the sum of $81,225.00. By way of illustration, if Lessee invests a total of $40,612.50
(i.e. 1/2of $81,225.00) then Lessee's monthly abatement shall be decreased to $500.00 per month throughout the lease term, effective January 1, 1999. Lessee shall provide Lessor
with proof of the sums which Lessee claims to have invested in the refurbishing or remodeling of the premises. In the event that Lessee has not made said investment in refurbishing or remodeling by
January 1, 1999, or has not provided Lessor with proof of said investment, then 

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Lessee's right to the monthly rental abatement called for in subparagraph 4.4 shall immediately extinguish, and Lessee shall pay the full scheduled monthly rent without any abatement. 

    4.5    For
the month commencing January 1, 1998, tenant shall also be given a one time deduction from rent in the sum of $292.20. This payment shall constitute the
remaining balance of the rental abatement for the four months from January 1998 through and including April 1998 at $73.55 per month, which is referred to in paragraph 4.5 of the
lease dated March 24, 1995. 

5.  USE  Lessee may use the Premises for any legal purpose during the term of the Lease. 

    5.1    Lessee
shall not do or permit anything to be done in or about the Premises nor bring or keep anything therein which will in any way increase the premium of fire
and other insurance policies existing as of the date of the execution of this Lease, or affect any fire or other insurance upon the Premises or any of its contents (unless Lessee shall pay any
increased premium as a result of such use or acts), or cause a cancellation of any insurance policy covering the Premises, or the building in which the Premises is located, or any of the contents of
the Premises. 

    5.2    Lessee
shall not do or permit anything to be done in or about the Premises which will in any way materially obstruct or interfere with the rights of other Lessees
at occupants of the property on which the Premises is located, or use or allow the Premises to be used for any unlawful purpose, nor shall Lessee cause, maintain or permit any nuisance in, on or about
the Premises. Lessee shall not commit or allow to be committed any waste in or upon the Premises. Lessee shall keep the Premises in a clean and wholesome condition, free of any odors or nuisances. 

6.  BUSINESS LICENSES AND PERMITS  Lessee hereby specifically agrees to comply with all licensing requirements of all
governmental authorities and to obtain all necessary licenses and permits, and to do all such acts required of Lessee in order to lawfully maintain Lessee's use within Lessor's Premises. Lessee hereby
agrees to indemnify Lessor for any failure to perform any acts required under this paragraph Six. 

7.  UTILITIES  Lessee shall pay for all water, gas, heat, power, telephone and other utility services supplied to the
Premises together with any taxes thereon. 

8.  ALTERATIONS AND ADDITIONS  Lessee shall make no material alterations to the interior of Premises without first
notifying Lessor as to the exact alterations by furnishing Lessor with plans and specifications or other detailed information covering such work and securing Lessor's approval and authorization in
writing prior to the commencement of any work, which approval shall not be unreasonably withheld. All costs of any improvements shall be exclusively borne by the Lessee. All such alterations or
additions which became permanently affixed to the Premises shall be and remain the property of Lessor. 

9.  INDEMNITY  Lessee shall indemnify and hold Lessor harmless from and against any and all claims arising from Lessee's
use or occupancy of the Premises or from the conduct of its business or from any activity, work, or things which may be permitted or suffered by Lessee in the Premises including all damages, costs,
attorney's fees, expenses and liabilities incurred in the defense of any claim or action or proceeding arising therefrom except for any claims arising out of Lessor's negligence or intentional acts.
Lessee hereby assumes all risk of damage to property or injury to person in or about the Premises from any cause, and Lessee hereby waives all claims in respect thereof against Lessor except for any
claims arising out of Lessor's negligence or intentional acts. 

    Lessor
shall not be liable for injury or damage which may be sustained by the person, goods, wares, merchandise or property of Lessee, its employees, invitees or customers, or any
other person in or about the Premises, 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 

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defects of the pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting fixtures, whether the damage or injury results from conditions arising upon the Premises or from any other
source, except for damages or injuries arising out of Lessor's failure to perform his obligations to maintain the Premises as provided under this Lease. 

10.  INSURANCE  

(A)  LIABILITY INSURANCE  

    10.1    Lessee
shall, at Lessee's sole expense, obtain and keep in force during the term of this Lease a policy of comprehensive public liability insurance insuring
Lessor and Lessee against any liability arising out of the ownership, use, occupancy or maintenance of the Premises and all areas appurtenant thereto in a combined single limit of not less that
$100,000-$300,000-$25,000 for bodily injury and/or property damage. The limits of such insurance shall not limit the liability of the Lessee hereunder. Lessee may provide this
insurance under a blanket policy, provided that said insurance shall have a Lessor's liability endorsement attached thereto. If Lessee shall fall to produce and maintain said liability insurance,
Lessor may, but shall not be required to, procure and maintain same, but at the expense of Lessee, and the cost thereof shall become due and payable as additional rental to Lessor together with
Lessee's next rental installment. Insurance required hereunder shall be in companies qualified by the State of California. No policy required under this paragraph shall be cancellable or subject to
reduction of coverage. All such policies shall be written as primary policies not contributing with, and not in excess of coverage which Lessor may carry. 

(B)  FIRE INSURANCE  

    10.2    During
the term of this Lease, Lessor at its cost shall maintain a policy or policies of standard fire and extended coverage insurance on the Premises to the
extent of at least ninety (90%) or full replacement value thereof. Said insurance policies shall be issued in the names of Lessor. If Lessor shall fail to produce and maintain said standard fire and
extended coverage insurance, Lessee may, but shall not be required to, procure and maintain same, but at the expense of Lessor, and the cost thereof shall be deducted from Lessee's next rental
installment. 

    10.3    The
liability insurance policy secured and maintained by Lessee shall identify the Lessor as ROBERT SARNO, TRUSTEE and FRANCES SARNO. 

    10.4    Upon
written demand by Lessor, Lessee shall be required within ten (10) days to provide Lessor with a copy of all insurance policies required under
section 10.1 of this Lease. 

    10.5    Upon
written demand by Lessee, Lessor shall be required within ten (10) days to provide Lessee with a copy of all insurance policies required under
section 10.2 of this Lease. 

11.  ASSIGNMENT AND SUBLETTING  Lessee shall not voluntarily or by operation of law, assign, transfer, sublet, mortgage,
or otherwise transfer or encumber all or any part of Lessee's interest in this Lease or in the Premises without Lessor's prior written consent, which consent shall not be unreasonably withheld.
Notwithstanding the foregoing, lessee shall have the right, after notice to Lessor, to assign or sublease all of a portion the premises, or the leasehold, to an affiliate or successor of Lessee. For
the purposes hereof, an "affiliate" or "successor" of Lessee is an entity under common control with or controlled by Lessee or Lessee's parent company, including an entity resulting from a merger,
acquisition or consolidation by Lessee. Lessor's consent shall also not be required for a change in Lessee's name. 

12.  SIGNS  Lessor grants Lessee the exclusive right to place signage for its business on the East and North sides of the
building and on the shopping center's main pole sign with a two space minimum provided such signs are first approved by Lessor, which approval shall not be unreasonably withheld, and comply in all
respects with all applicable legal requirements. Under no circumstances is Lessee 

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permitted to install or maintain any signs on the roof of the building unless such roof sign is first expressly approved by the Lessor in writing, which approval shall not be unreasonably withheld.
Lessor further grants Lessee exclusive signage rights on the side of the building immediately behind Lessee's premises co-extensive with the wall enclosing Lessee's premises on that side
of the building, however, this grant of right shall not prevent other tenants of the center from placing signs on the back wall of their premises, nor shall this grant of right require any tenant from
removing any signs which are currently on the building. 

13.  OCCUPATIONAL SAFETY AND HEALTH ACT  Lessee covenants at all times during the term of the Lease to comply with the
requirements of the Occupational Safety and Health Act of 1970, 29 U.S.C. Section 651 et seq and any analogous legislation in California (collectively, the "Act"), to the extent that the Act
applies to the Premises and any activities thereon. Without limiting the generality of the foregoing, Lessee covenants to maintain all working areas, all machinery, structures, electrical facilities
and the like upon the Premises in a condition that fully complies with the requirements of the Act including such requirements as would be applicable with respect to agents, employees or contractors
of Lessor who may from time to time be present on the Premises. Lessee agrees to indemnify and hold harmless Lessor from any liability, claims or damages arising as a result of a breach of the
foregoing covenant and from all costs, expenses and charges arising therefrom including, without limitation, attorneys' fees and court costs incurred by Lessor in connection therewith, except for any
claim arising from the negligence or intentional acts of Lessor. Said indemnity shall survive the expiration or the termination of this Lease. 

14.  DEFAULT  The occurrence of any of the following shall constitute a default and breach of this Lease by Lessee: 

    14.1    Any
failure by Lessee to pay the rent or any other monetary sums required to be paid hereunder, where such failure continues for five (5) days after
written notice by Lessor to Lessee; 

    14.2    The
making of any general assignment or arrangement for the benefit of creditors, or if Lessee shall take any action under any insolvency or Bankruptcy act unless
the same is dismissed within sixty (60) days; 

    14.3    The
failure of Lessee to observe or perform any other provision of this Lease to be observed or performed by Lessee where such failure continues for thirty
(30) days after written notice thereof to Lessee provided however that if the nature of Lessee's default is such that more than thirty (30) days are reasonably necessary for its cure,
then it shall not be deemed a default and breach of this Lease if Lessee commences such cure within said thirty (30) day period. 

15.  LESSOR'S REMEDIES  In the event of any default or breach by Lessee, Lessor shall have the following remedies which
are set forth in paragraphs 15.1 and 15.2 of this Lease. These remedies are not exclusive but are cumulative and in addition to any remedies now or hereafter allowed by law. 

    15.1    Maintain
the Lease in full force and effect and recover the rent and other charges as they become due without terminating Lessee's right to possession,
irrespective of whether Lessee shall have abandoned the Premises. 

    15.2    Terminate
Lessee's right to possession by any lawful means, in which case this Lease shall terminate and Lessee shall immediately surrender possession of the
Premises to Lessor. In such event, Lessor shall be entitled to recover from Lessee all damages incurred by Lessor by reason of Lessee's default. 

16.  MAINTENANCE AND REPAIRS  

    16.1    Lessor
shall repair and maintain the structural portion of the Premises, including foundations, exterior walls and roof, existing fire sprinklers (if any), smoke
detection system, plumbing, air conditioning units, parking lot, landscaping and storage utility areas, windows, plate 

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glass and doors, unless such maintenance or repair is caused in whole or in part by the gross negligence of the Lessee, its agents, employees or invitees. Unless otherwise specified in this Lease,
there shall be no abatement of rent and no liability of Lessor by reason of any injury to or interference with Lessee's business arising from the making of any repairs, alterations or improvements in
or to any portion of the Premises, or the building provided however that in the event such interference shall continue for seventy-two (72) hours or more; Lessee shall be entitled
to an abatement of rent until such interference has ceased. Lessor shall take reasonable efforts not to disturb Lessee during the course of any such repairs, alterations or improvements. Lessee waives
the provisions of any law permitting Lessee to make repairs at Lessors expense. 

    16.2    Lessee
shall maintain in good order, condition and repair the interior of the Premises, including all electrical equipment and plumbing installed therein, and all
improvements and fixtures and equipment
installed by the Lessee in the Premises. In addition, it shall be Lessee's sole obligation to repair all broken doors and looks. 

    16.3    In
the event that Lessee fails to maintain the Premises in good order, condition and repair, Lessor shall give Lessee notice to do such acts as are reasonably
required so to maintain the Premises. In the event Lessee fails promptly to commence such work or diligently prosecute the same to completion, Lessor may, but is not obligated to do such acts and
expend such funds at the expense of Lessee as are reasonably required to perform such work and the cost thereof shall become due and payable as additional rental to Lessor together with Lessee's next
rental installment. 

    16.4    In
the event that Lessor fails to maintain the Premises in good order, condition and repair, Lessee shall give Lessee notice to do such acts as are reasonably
required so to maintain the Premises. In the event Lessor fails promptly to commence such work or diligently prosecute the same to completion, Lessee may, but is not obligated to do such acts and
expend such funds at the expense of Lessor as are reasonably required to perform such work and the reasonable cost thereof shall be deducted from Lessee's next rental installment. 

    16.5    Upon
reasonable notice to Lessee, Lessor, or its officers or agents, shall have the right to enter the Premises to examine them, or to make such repairs,
alterations, and additions as Lessor deems necessary for the safety, preservation and improvement of the Premises or the building as long as such repairs, alterations or additions do not interfere
with Lessee's business. In addition, Lessor or its officers or agents may place on the exterior walls of the Premises, excluding however the windows or doors of the premises, a notice "to Rent" or "to
Lease," for one month prior to the expiration of this Lease. 

17.  ADDITIONAL RULES  Lessor reserves the right to make such other and further reasonable rules and regulations as in
Lessor's reasonable discretion and judgment may from time to time be necessary for the safety, care and cleanliness of the building and for the preservation of good order in it. 

    17.1    Parking — Lessor agrees that Lessee's employees shall have the right to park six (6) cars on
the parking lot of the Premises during working hours, however, Lessor in his discretion may designate which parking spaces are to be used by Lessee's employees and may, from time to time, change the
location of those parking spaces or promulgate reasonable rules regarding the use of the parking lot for the safety and convenience of customers or other tenants. Except for the three
(3) parking spaces currently reserved and marked for the use of the medical patients of the medical tenant occupying the premises at 17648 Ventura Blvd, no other parking spaces will be reserved
or marked for the exclusive use of any of the present or future tenants of the shopping center, unless marked or reserved spaces are provided to each tenant of the center on a pro rata basis based on
the proportion that the square footage of that tenant's premises bears to the total amount of the square footage of the center which, for this calculation is 12,000 square feet, 

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    17.2    Valet Parking — If, from time to time, valet parking is provided in the center's parking lot, the
valet service parking sign shall include language indicating that the valet service includes all tenants of the shopping center. To the extent that any tenant pays a co-operative share of
the expense of a valet parking service for the center, that tenant shall also be entitled to have its name specifically included on any valet service parking sign. Nothing herein shall constitute an
obligation or duty on the part of Lessor to provide or maintain valet parking for the center. 

18.  LIENS  Lessee shall keep the Premises and the property in which the Premises are situated free from any liens
arising out of any work performed, materials furnished or obligations incurred by or on behalf of Lessee. 

19.  SURRENDER  On the last day of the term of this Lease, Lessee shall surrender the Premises to Lessor in good
condition, broom clean, ordinary wear and tear and damage by fire and elements excepted. Lessee shall remove his properly on or before the expiration date, or the termination date, whichever is
applicable, and shall repair all material damage to the Premises or building caused by such removal. 

    If
Lessee shall fail to remove all his property by the expiration date, or the termination date, whichever is applicable, or if Lessee abandons or surrenders the Premises, or is
dispossessed by process of law, or otherwise, any of Lessee's property left on the Premises shall be deemed to be abandoned, and, at Lessor's option, title shall pass to Lessor under this Lease as by
a bill of sale. If Lessor elects to remove all or any part of Lessee's property, then cost of removal, including repairing any material damage to the Premises caused by such removal shall be paid by
Lessee. On the expiration date, or the termination day, whichever is applicable, Lessee shall surrender to Lessor all keys to the Premises. 

20.  HOLDING OVER  This Lease shall terminate and become null and void without further notice upon the expiration of the
term herein specified, and any holding over by Lessee after such expiration shall not constitute a renewal thereof or give Lessee any rights hereunder or in or to the Premises except as otherwise
herein provided, it being understood and agreed that this Lease cannot be renewed, extended or in any manner modified except in writing signed by both parties hereto. If Lessee shall hold over for any
period after the expiration of said term, Lessor may, at its option exercised by written notice to Lessee, treat Tenant as a Lessee from month to month commencing on the first day following the
expiration of this Lease and subject to the terms and conditions herein contained except that the net guaranteed minimum monthly rental, which shall be payable in advance, shall be the minimum basic
rent which was payable by Lessee in the month prior to expiration of the Lease. During any month-to-month possession of the Premises by the Lessee, the Lessee agrees that
Lessee shall be subject to all the other covenants, conditions, obligations, and duties imposed under the provisions of this Lease. Futhermore, if Lessee fails to surrender the Premises upon
expiration of this lease despite demand to do so by Lessor, Lessee shall indemnify and hold Lessor harmless from all loss or liability, including without limitation any claims made by any succeeding
lessee founded on or resulting from such failure to surrender. 

21.  BINDING ON SUCCESSORS AND ASSIGNS  Each provision of this Lease to be performed by Lessee shall be deemed both a
covenant and condition. The terms, conditions and covenants of this Lease shall be binding upon and shall inure to the benefit of each of the parties hereto, their heirs, personal representatives,
successors and assigns. 

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   22.  NOTICE  Whenever under this Lease a provision is made for any demand, notice or declaration of any kind, it shall be
in writing and sent by registered or certified United States mail, postage prepaid, return receipt requested, addressed as follows: 

	TO LESSOR:	 	ROBERT SARNO, TRUSTEE

2064 N. New Hampshire Ave

Los Angeles, CA 90027
	

TO LESSEE:	
 	

PACIFIC CREST BANK

30343 Canwood Street, Suite 100

Agoura Hills, CA 21301

Attention: LYLE C. LODWICK

    Such
notice shall be deemed to be received within forty-eight (48) hours from the time of mailing, if mailed as provided for in this paragraph. 

23.  WAIVERS  Except to the extent that the Lessor may have otherwise agreed in writing, no waiver by Lessor of any breach
by Lessee of any of Lessee's obligations, agreements or covenants hereunder shall be deemed to be a waiver of any subsequent or continuing breach of the same or any other covenant, agreement or
obligation. Nor shall any forbearance by Lessor to seek a remedy for any breach by Lessor be deemed a waiver by Lessor of Lessor's rights or remedies with respect to such breach. 

24.  TIME  Time is of the essence of this Lease. 

25.  SEVERABILITY  The unenforceability, invalidity or illegality of any provision of this Lease shall not render any
other provision hereof unenforceable, invalid or illegal. 

26.  ESTOPPEL CERTIFICATES  Each party, within then (10) days after notice on the other party, shall execute and
deliver to the other party a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modification. The certificate
shall also state the amount of minimum monthly rent, the dates to which rent has been paid in
advance, and the amount of any security deposit or prepaid rent, if any, as well as acknowledging that there are not, to that party's knowledge, any uncured defaults on the part of the other party, or
specifying such defaults, if any, which are claimed. Failure to deliver such a certificate within the ten (10) day period shall be conclusive upon the party failing to deliver the certificate
to the benefit of the party requesting the certificate that this Lease is in full force and effect, that there are no uncured defaults hereunder, and that the Lease has not been modified. 

27.  COVENANTS AND CONDITIONS  Each provision of this Lease performable by Lessee shall be deemed both a covenant and a
condition. 

28.  SINGULAR AND PLURAL  When required by the context of this Lease, the singular shall include the plural. 

29.  ATTORNEY'S FEES  Reasonable attorney's fees and other expenses incurred by either party hereto in enforcing any
provision of this Lease or in any action or proceeding in which either party hereto is successful by reason of a default by the other party, in complying with any requirement of this Lease shall be
paid to the prevailing party. 

30.  LATE CHARGES.  Lessor and Lessee agree that the fixing of actual damages for Lessee's breach of any of the provisions
of this Lease including the late payment by Lessee to Lessor of rent and other sums due hereunder will cause Lessor to incur costs not contemplated by this Lease the exact amount of which will be
extremely difficult or impracticable to ascertain. Accordingly, in the event any installment of rent or any other sum due from Lessee hereunder shall not be received by Lessor within ten
(10) days after such amount may be due, Lessee shall pay to Lessor as liquidated damages, a late 

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charge equal to One Hundred and Fifty Dollars ($150.00) per month, for as long as such installment of rent of any other sum due from Lessee remains unpaid. The parties hereby agree that said late
charge represents a fair and reasonable estimate of the cost Lessor will incur by reason of late payment by Lessee. Acceptance of such late charge by Lessor shall not constitute a waiver of Lessee's
default with respect to such overdue amount nor prevent Lessor from exercising any other rights and remedies provided for in the Lease or by application of law. 

31.  LESSOR'S ACCESS TO PREMISES.  So long as Lessor does not unreasonably interfere with Lessee's business, Lessor shall
at all reasonable times during Lessee's business hours have access to the Premises for the purpose of inspection or repair. 

32.  TERMINATION OF PRIOR LEASE  Upon execution of this Lease, the prior Lease between the parties relating to the
premises, dated March 26, 1995, which created a lease term commencing May 1, 1995 and terminating April 31, 1998, shall be immediately terminated and all rights and duties under
that Lease shall be extinguished and thereafter all the rights and duties of the parties relating to the premises shall be superceded by the rights and duties as set forth in this Lease Agreement. 

33.  ENTIRE AGREEMENT  This Lease constitutes the entire agreement between the parties and no portion of it may be
modified except in writing, signed and dated by each of the parties to this agreement. Attached to this Lease is a six (6) page ADDENDUM initialed on each page by Lessor and Lessee which is
hereby incorporated and made part of this Lease. 

    IN
WITNESS WHEREOF, Lessor and Lessee have executed this Lease Agreement in Los Angeles, California on the date set forth below. 

	DATED:	 	Dec. 31
	 	, 1997	 	 	 	/s/ ROBERT SARNO   
 ROBERT SARNO, TRUSTEE (Lessor)
	

DATED:	
 	

Dec. 31
	
 	

, 1997	
 	

 	
 	

/s/ FRANCES SARNO   
 FRANCES SARNO (Lessor)
	

DATED:	
 	

Dec. 31
	
 	

, 1997	
 	

BY	
 	

/s/ LYLE C. LODWICK EVP   
 PACIFIC CREST BANK

(Lessee)

    Lyle C. Lodwick

    Executive Vice President

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ADDENDUM TO LEASE AGREEMENT DATED DECEMBER 31, 1997, BY AND BETWEEN ROBERT SARNO, TRUSTEE AND FRANCES SARNO, TRUSTEE, ("LESSOR") AND PACIFIC CREST INVESTMENT AND LOAN
("LESSEE")  

34.  Compliance of Premises.  

	34.1
	Lessor represents, warrants, and COVENANTS that the Premises, and all improvements thereto, complies with any and all laws,
ordinances, codes, rules, regulations, or order applicable in the municipality in which the Premises is located, or any other governmental or quasi-governmental authority by reason of Lessee's use of
the Premises. Lessor shall be responsible for the compliance of the Premises and the means of access thereto from a public way with the requirements of the Americans with Disabilities Act (42 U.S.C.
Section 12101 et.seq.) and the regulations and Accessibility Guidelines for Buildings and Facilities issued pursuant thereto.

	34.2
	Lessor represents, warrants, and covenants that the existing plumbing, electrical, and HVAC system, if any, for the Premises is in
good working order as of the date of this Lease. Notwithstanding anything to the contrary set forth in this Lease, in the event it is necessary to repair or replace any of the lighting, plumbing, air
conditioning and/or heating systems or units servicing the Premises, Lessor shall pay for such costs. 

35.  Without Utilities.  

    Notwithstanding
anything to the contrary contained in the Lease or in the event Lessee is without utilities, including air conditioning and lighting, such that Lessee is unable to
conduct business in the Premises for a period of forty-eight (48) hours or more, Lessee shall be entitled to an abatement of rent until such time as the utility services have been restored. 

36.  Lessor Indemnity.  

    Lessor
shall indemnify and hold harmless Lessee from and against any and all claims arising from Lessor's negligence or willful acts. 

37.  Non-Disturbance.  

    As
a condition precedent to entering into this Lease, Lessor shall obtain from Beneficiary a non-disturbance agreement in a form acceptable by Lessee which provides that
if Lessor's interest in the Premises is sold or conveyed upon the exercise of any remedy provided in the mortgage, deed of trust, leasehold interest, or other encumbrance or lien ("Underlying
Mortgage") or by deed in lieu thereof, or if the holder of the Underlying Mortgage takes possession of the Premises thereto, this Lease shall not be terminated, nor shall Lessee's possession of the
Premises be disturbed, and Lessee shall be entitled the rights of quiet enjoyment. Lessor and Lessee acknowledge that the Premises are encumbered by a Deed of Trust in favor of RANCHO BANK
("Beneficiary') hereunder. 

38.  Environmental.  

    Neither
Lessor nor any previous owner, lessee, occupant, or user of the Premises, or the property it is located within ("Shopping Center") has used, generated, released, discharged,
stored or disposed of any hazardous materials, on, under, in, or about the Premises, the Shopping Center, or transported any hazardous materials to or from the Premises, the Shopping Center. Lessor
shall not cause or knowingly permit the presence, use, generation, release, discharge, storage or disposal of any hazardous materials on, under, in, or about, or in the transportation of any hazardous
materials to or from the Premises, or the Shopping Center. The Premises and the Shopping Center, is not in violation of any hazardous materials laws. Lessee shall not be liable for the disposal of any
materials used in the construction of the Premises or the Shopping Center which, in the future, may violate any hazardous materials laws. 

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39.  Competition.  

    Lessor
shall not permit any other lessee in the Shopping Center to conduct any business which in any manner whatsoever engages in any activity as a bank, savings and loan, thrift,
mortgage company, or any other financial institution. 

40.  Additional Rights of Abatement of Rent and Termination of Lease.  

    If,
during the term of the Lease, any event or circumstance of any nature whatsoever shall occur or arise rendering it impossible or impractical for Lessee to use the Premises, or any
part thereof, for any purpose or purposes which Lessee may now, then, or at any other time during the term of this Lease contemplate or intend, whether such event or circumstance consists of the
prohibition by law,
ordinance, or other governmental act or authority of any use the Premises, or any part thereof, or consists of any injunction, or other local interference, by any private person, firm, or corporation,
or consists of any other act or occurrence whatsoever, the occurring or arising of such event or circumstance shall allow the abatement of rent during such occurrence and in the event this occurrence
shall occur for thirty (30) days, Lessee shall have the option to terminate this Lease. 

41.  Damage and Destruction.  

41.1.  Definitions.  

    "Premises
Partial Damage" shall mean damage or destruction to the Premises, the repair costs of which damage or destruction is less than fifty percent (50%) of the then Replacement
Cost (as defined herein) of the Premises. 

    "Premises
Total Destruction" shall mean damage or destruction to the Premises, the repair cost of which damage or destruction is fifty percent (50%) or more of the Replacement Cost of
the Premises prior to such damage or destruction. 

    "Insured
Loss" shall mean damage or destruction to the Premises which was caused by an event required to be covered by the insurance described hereunder irrespective of any deductible
amounts or coverage limits involved. 

    "Replacement
Cost" shall mean the cost to repair or rebuild the improvements owned by Lessor at the time of the occurrence to their condition existing immediately prior thereto,
including demolition, debris removal and upgrading required by the operation of applicable building codes, ordinances or laws and without deduction for depreciation. 

41.2.  Premises Partial Damage—Insured Loss.  

    If
Premises Partial Damage that is an Insured Loss occurs, then Lessor shall, at Lessor's expense repair such damage as soon as reasonably possible and this Lease shall continue in
full force and effect. In the event, however, that there is a shortage of insurance proceeds and such shortage is due to the fact that by reason of the unique nature of the improvements in the
Premises, full replacement cost insurance coverage was not commercially reasonable and available, Lessor shall have the obligation to pay for the shortage in insurance proceeds to fully restore the
unique aspects of the Premises. If Lessor cannot repair the damage within ninety (90) days from the date of such occurrence, then Lessee shall have the option to cancel and terminate this
Lease; provided, however, that in the event Lessor fails to
repair the damage to the Premises in a timely manner, Lessee shall have the option to use the proceeds of such insurance obtained by Lessor to perform the repairs of the Premises. 

41.3.  Premises Partial Damage—Uninsured Loss.  

    If
Premises Partial Damage that is not Insured Loss occurs, unless caused by a negligent or willful act of Lessor (in which event Lessor shall make the repairs at Lessor's expense and
this Lease shall continue in full force and effect), either party may, at their respective option either (i) repair such 

10

 

damage as soon as reasonably possible at its expense, in which event this Lease shall continue in full force and effect, or (ii) give written notice to the other party within thirty
(30) days after the occurrence of such damage of the party's desire to terminate this Lease effective as of the date of occurrence of such damage. 

41.4.  Damage Near End of Term.  

    If
at any time during the last six (6) months of the term of this Lease there is damage for which the cost to repair exceeds one month's Rent, whether or not an Insured Loss,
Lessor or Lessee may at their respective options terminate this Lease effective the date of occurrence of such damage by giving written notice to the other party of the party's election to do so
within thirty (30) days after the date of occurrence of such damage; provided, however, that if Lessee at the time has an exercisable option to extend this Lease, then Lessee may preserve this Lease
by exercising such option before the earlier of (i) within ten (10) days of Lessee's receipt of Lessor's written notice purporting to terminate this Lease, or (ii) the day prior
to the date upon which such option expires. If Lessee duly exercises such an option during such period, Lessor shall, at Lessor's expense, repair such damage as soon as reasonably possible and this
Lease shall continue in full force and effect. If Lessee fails to exercise such option then this Lease shall terminate as of the date set forth in the first sentence of this Paragraph; provided,
however, that in the event Lessor fails to repair the damage to the Premises in a timely manner, Lessee shall have the option to use the proceeds of such insurance obtained by Lessor to perform the
repairs of the Premises. 

41.5.  Premises Total Destruction.  

    Notwithstanding
any other provision hereof, if Premises Total Destruction occurs (including any destruction required by any authorized public authority), this Lease shall terminate
effective the date of the occurrence of destruction of the Premises Total Destruction, whether or not the damage or destruction is an Insured Loss or was caused by a negligent or willful act of Lessee
or Lessor. 

41.6.  Abatement of Rent; Lessee's Remedies.  

    In
the event of Premises Partial Damage or Premises Total Destruction, the Rent provided hereunder and any other charges, if any, payable by Lessee hereunder for the period during
which such damage or condition, its repair, remediation, or restoration continues, shall be abated. 

42.  Breach by Lessor.  

    Lessor
shall not be deemed in breach of this Lease unless Lessor fails within ten (10) days after written notice to perform an obligation required to be performed by Lessor;
provided, however, that if the nature of Lessor's obligation is such that more than ten (10) days after such notice is reasonably required for its performance, then Lessor shall not be in
breach of this lease if performance is commenced within such ten (10) day period and thereafter diligently, pursued to completion. 

43.  Condemnation.  

    If
the Premises or any portion thereof are taken under the power of eminent domain or sold under the threat of the exercise of said power (all of which are herein called
condemnation"), this Lease shall terminate as to the part so taken as of the date the condemning authority takes title or possession, whichever first occurs. If more than ten percent (10%) of the
floor areas of the Premises, or more than twenty-five percent (25%) of the portion of the common areas designated for Lessee's parking is taken by condemnation, Lessee may, at Lessee's
option, to be exercised in writing within ten (10) days after Lessor shall have given Lessee written notice of such taking (or in the absence of such notice, within ten (10) days after
the condemning authority shall have taken possession) terminate this Lease as of the date the condemning authority takes such possession. If Lessee does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion of the Premises remaining, except that the Rent shall be reduced in the same proportion as the 

11

 

rentable floor area of the Premises taken bears to the total rentable floor area of the Premises. Any award for the taking of all or any part of the Premises under the power of eminent domain or any
payment made under threat of the exercise of such power shall be the property of Lessor, except for compensation for diminution of value of the leasehold; provided, however, that Lessee shall be
entitled to any compensation, separately awarded to Lessee for Lessee's relocation expenses and/or loss of Lessee's trade fixtures. 

44.  Representations and Warranties.  

    Lessee
and Lessor reach represent and warrant to the other that it has had no dealings with any person, firm, broker, or finder in connection with the negotiation of this Lease and/or
the consummation of the transaction contemplated hereby, and that no broker or other person, firm, or entity is entitled to any commission or finder's fee in connection with said transaction. Lessee
and Lessor do each hereby agree to indemnify, protect, defend, and hold the other harmless from and against liability for compensation or charges which may be claimed by any such unnamed broker,
finder, or other similar party by reason of any dealings or actions of the indemnifying Party, including any costs, expenses, and/or attorneys' fees reasonably incurred with respect thereto. 

45.  Waiver of Subrogation.  

    Without
affecting any other rights or remedies, Lessee and Lessor each hereby release and relieve the other and waive their entire right to recover damages (whether in contract or in
tort) against the other, for loss or damage to their property arising out of or incident to the perils required to be insured against under Paragraph 10. The effect of such releases and waivers
of the right to recover damages shall not be limited by the amount of insurance carried or required, or by any deductibles applicable thereto. Lessor and Lessee agree to have their respective
insurance companies issuing property damage insurance waive any right to subrogation that such companies may have against Lessor or Lessee, as the case may be, so long as the insurance is not
invalidated thereby. 

12

QuickLinks

EXHIBIT 10.11

Office Lease Between Robert Sarno, Trustee and Frances Sarno, Trustee and Pacific Crest Bank, dated December 31, 1997 (Encino Branch)

LEASE AGREEMENTPrepared by MERRILL CORPORATION

QuickLinks
 -- Click here to rapidly navigate through this document

 
 

EXHIBIT 10.12    
  

     Office Lease Between The Klussman Family Trust and Pacific

Crest Bank, dated December 16, 1998

(Agoura Hills Corporate Office)  

THIS LEASE is made between Lessor and Lessee named below as of the later of the dates set forth under their respective signatures. 

 
 

BASIC LEASE PROVISIONS    
  

	1.
	BUILDING
NAME: MEDITERRANEA II 

PREMISES
ADDRESS: 30343 Canwood St. Agoura Hills, CA 91301 

	2.
	RENTAL
AREA: 16,361 Sq. Ft.: Suites #100 thru 104 Inclusive together with Suites 106, 110, 112, 200 and 212

	3.
	BUILDING
OCCUPANCY PERCENTAGE: 16,361 / 27,712 = 59%

	4.
	BASIC
ANNUAL RENT: $270,254.40

	5.
	MONTHLY
RENTAL INSTALLMENTS: $22,521.20

	6.
	BASIC
RENT INCREASE: On July 1, 1999 the Basic Annual Rent shall be increased to $284,681.40 and on July 1, of each Lease Year commencing on July 1, 2000 the
Basic Annual Rent shall be adjusted as provided in Paragraph 3.2 of this Lease.

	7.
	TERM:
Seven (7) years and Six (6) months

	8.
	LEASE
COMMENCEMENT DATE: January 1, 1999

	9.
	LEASE
TERMINATION DATE: June 30, 2006

	10.
	SECURITY
DEPOSIT: None

	11.
	BROKER(s):
NONE

	12.
	LEASE
OPTIONS: One (1) Five (5) Year Option 

    IN
WITNESS WHEREOF, the parties hereto have executed this Lease, consisting of the foregoing Basic Lease Provisions and Paragraphs 1 through 18 which follow, as of the later of the
below dates. 

	Dated:	December 16, 1998	 	Dated:	December 16, 1998
	 	
	 	 	

	

 	

 	
 	

 	

 
	

LESSOR:	

 	
 	

LESSEE:	

 
	

THE KLUSSMAN FAMILY TRUST

30343 Canwood Street, #108

Agoura Hills, CA 91301	
 	

PACIFIC CREST BANK

30343 Canwood Street, #100

Agoura Hills, CA 91301
	

 	

 	
 	

 	

 
	

By:	

/s/ WILLIAM P. KLUSSMAN   
 William P. Klussman

Trustee	
 	

By:	

/s/ LYLE C. LODWICK   
 Lyle C. Lodwick

Executive Vice President

(i) 

 
 

TABLE OF CONTENTS    
  

	Paragraph
 
	 	 
	 	Page

	 	 	 	 	BASIC LEASE PROVISIONS	 	(i)
	

 	
 	

 	
 	

TABLE OF CONTENTS	
 	

(ii)
	

 	
 	

 	
 	

TABLE OF CONTENTS	
 	

(iii)
	

1.	
 	

 	
 	

LEASE OF PREMISES	
 	

1
	

2.	
 	

 	
 	

TERM	
 	

1
	

 	
 	

2.1	
 	

Commencement of Term	
 	

1
	

3.	
 	

 	
 	

RENT	
 	

1
	

 	
 	

3.1	
 	

Basic Rent	
 	

1
	

 	
 	

3.2	
 	

Rent Increase	
 	

1
	

4.	
 	

 	
 	

(NOT USED)	
 	

2
	

5.	
 	

 	
 	

USE	
 	

2
	

 	
 	

5.1	
 	

Use of Premises	
 	

2
	

 	
 	

5.2	
 	

Compliance with Law	
 	

2
	

6.	
 	

 	
 	

MAINTENANCE, REPAIRS AND ALTERATIONS	
 	

2
	

 	
 	

6.1	
 	

Lessor's Obligations	
 	

2
	

 	
 	

6.2	
 	

Lessee's Obligations	
 	

2
	

 	
 	

6.3	
 	

Surrender	
 	

3
	

 	
 	

6.4	
 	

Alterations and Additions	
 	

3
	

7.	
 	

 	
 	

INSURANCE; INDEMNITY	
 	

4
	

 	
 	

7.1	
 	

Liability Insurance	
 	

4
	

 	
 	

7.2	
 	

Property Insurance	
 	

4
	

 	
 	

7.3	
 	

Waiver of Subrogation	
 	

4
	

 	
 	

7.4	
 	

Indemnity	
 	

5
	

 	
 	

7.5	
 	

Exemption of Lessor from Liability	
 	

5
	

 	
 	

7.6	
 	

Lessee's Insurance	
 	

5
	

8.	
 	

 	
 	

DAMAGE OR DESTRUCTION	
 	

5
	

 	
 	

8.1	
 	

Partial Damage—Insured	
 	

5
	

 	
 	

8.2	
 	

Partial Damage—Uninsured	
 	

5
	

 	
 	

8.3	
 	

Damage Near End of Term	
 	

6
	

 	
 	

8.4	
 	

Abatement of Rent; Lessee's Remedies	
 	

6
	

 	
 	

8.5	
 	

Total Destruction	
 	

6
	

 	
 	

8.6	
 	

Insurance Proceeds Upon Termination	
 	

6
	

 	
 	

8.7	
 	

Restoration	
 	

6
	

9.	
 	

 	
 	

PERSONAL PROPERTY TAXES	
 	

6
	

10.	
 	

 	
 	

UTILITIES	
 	

7
	

11.	
 	

 	
 	

ASSIGNMENT AND SUBLETTING	
 	

7
	

 	
 	

11.1	
 	

Lessor's Consent Required	
 	

7
	

 	
 	

11.2	
 	

Terms and Conditions of Assignment	
 	

7
	

 	
 	

11.3	
 	

Assignee Lessee Affiliate	
 	

8
	

12.	
 	

 	
 	

DEFAULTS; REMEDIES	
 	

8
	

 	
 	

12.1	
 	

Default by Lessee	
 	

8
	

 	
 	

12.2	
 	

Remedies for Default of Lessee	
 	

8
	

 	
 	

12.3	
 	

Default by Lessor	
 	

9
	

 	
 	

12.4	
 	

Late Charges	
 	

9

(ii) 

	Paragraph
 
	 	 
	 	Page

	13.	 	 	 	CONDEMNATION OR RESTRICTION ON USE	 	9
	

 	
 	

13.1	
 	

Termination of Lease on Total Taking	
 	

9
	

 	
 	

13.2	
 	

Lessee's Election to Terminate on Partial Taking	
 	

10
	

 	
 	

13.3	
 	

Each Party Entitled to Award	
 	

10
	

 	
 	

13.4	
 	

No Termination—Repairs & Rent Reduction	
 	

10
	

 	
 	

13.5	
 	

Notice of Condemnation	
 	

10
	

 	
 	

13.6	
 	

Voluntary Sale as Taking	
 	

10
	

14.	
 	

 	
 	

BROKERS	
 	

10
	

15.	
 	

 	
 	

LESSOR'S LIABILITY	
 	

10
	

16.	
 	

 	
 	

GENERAL PROVISIONS	
 	

11
	

 	
 	

16.1	
 	

Estoppel Certificate	
 	

11
	

 	
 	

16.2	
 	

Severability	
 	

11
	

 	
 	

16.3	
 	

Time of Essence	
 	

11
	

 	
 	

16.4	
 	

Captions	
 	

11
	

 	
 	

16.5	
 	

Notices	
 	

11
	

 	
 	

16.6	
 	

Waivers	
 	

11
	

 	
 	

16.7	
 	

Holding Over	
 	

11
	

 	
 	

16.8	
 	

Cumulative Remedies	
 	

11
	

 	
 	

16.9	
 	

Inurement; Choice of Law	
 	

12
	

 	
 	

16.10	
 	

Subordination and Non-Disturbance	
 	

12
	

 	
 	

16.11	
 	

Attorney's Fees	
 	

12
	

 	
 	

16.12	
 	

Lessor's Access	
 	

12
	

 	
 	

16.13	
 	

Corporate Authority	
 	

12
	

 	
 	

16.14	
 	

Rights of Others	
 	

12
	

 	
 	

16.15	
 	

Safety & Health	
 	

13
	

 	
 	

16.16	
 	

Surrender or Cancellation	
 	

13
	

 	
 	

16.17	
 	

Entire Agreement	
 	

13
	

 	
 	

16.18	
 	

Signs	
 	

13
	

 	
 	

16.19	
 	

Interest on Past Due Obligations	
 	

13
	

 	
 	

16.20	
 	

Gender; Number	
 	

13
	

 	
 	

16.21	
 	

Lease Not Subject to Levy	
 	

13
	

 	
 	

16.22	
 	

Quitclaim	
 	

14
	

 	
 	

16.23	
 	

Confidentiality of Lease	
 	

14
	

17.	
 	

 	
 	

PARKING	
 	

14
	

18.	
 	

 	
 	

RIGHT OF FIRST REFUSAL	
 	

14
	

19.	
 	

 	
 	

OPTION TO EXTEND LEASE TERM	
 	

15
	

 	
 	

19.1	
 	

Option	
 	

15
	

 	
 	

19.2	
 	

Effect of Defaults on Option	
 	

15

RULES
AND REGULATIONS 

EXHIBIT
"A"        Site Plan and Floor Plans 

EXHIBIT
"B"        Sign Site Plans 

(iii)

 

1.  LEASE OF PREMISES  

    Lessor
hereby leases to Lessee and Lessee leases from Lessor for the term, at the rental, and upon all of the conditions set forth in this Lease, those certain premises (the
"Premises") in that certain building (the "Building") which address is 30343 Canwood Street, Agoura Hills, California 91301 identified in Item 2 of the
Basic Lease Provisions, together with non-exclusive use of any common areas in the Building and of the parking areas adjoining the Building in common with other tenants of the Building.
The approximate configuration of said Premises and the location of the Building, Premises and associated parking is indicated on Exhibit "A" which is attached hereto and incorporated herein by this
reference. 

2.  TERM  

    2.1  Commencement of Term  

    The
term of the Lease shall be as shown in Item 7 of the Basic Lease Provisions, commencing on the date as shown in Item 8 of the Basic Lease Provisions and terminating on the date as
shown in Item 9 of the Basic Lease Provisions, unless sooner terminated pursuant to any provision hereof. 

3.  RENT  

    3.1  Basic Rent.  Lessee shall pay to Lessor as rent for the Premises a basic annual rent in the amount
specified in Item 4 of the Basic Lease Provisions, payable without deduction offset, except as provided herein, or in equal monthly installments in the amounts specified in Item 5 of the Basic Lease
Provisions, in advance, on the first day of each month, in lawful money of the United States, to Lessor at the address stated herein, or to such other persons or at such other places as Lessor may
designate in writing. Rent for any period during the term hereof which is for less than one month shall be a pro rata portion of the monthly installment based on a thirty (30) day month. Rent
shall commence on January 1, 1999. 

    3.2  Rent Increase.  

    (a) At
the times set forth in Item 6 of the Basic Lease Provisions, the monthly Base Rent payable under paragraph 3.1 of this Lease shall be adjusted by the
increase since June 1999, if any, in the Consumer Price Index of the Bureau of Labor Statistics of the Department of Labor for All Urban Consumers, (1982-84 = 100), "All Items," for
the Los Angeles-Anaheim-Riverside, herein referred to as "C.P.I.". 

    (b) The
adjusted monthly Base Rent payable pursuant to Paragraph 3.2 (a) shall be calculated as follows: The original Base Rent shall be multiplied by a
fraction, the numerator of which will be the C.P.I. for June of the calendar year during which the adjustment is to take effect, and the denominator of which shall be the C.P.I. for June 1999:  provided,
however, that the increase in the new monthly Base Rent shall not exceed four percent (4%) of the Base Rent payable for the month immediately
preceding the date of such rent adjustment. The sum so calculated shall constitute the new monthly Base Rent. In no event shall said new monthly Base Rent be less than said preceding Base Rent. 

    (c) In
the event the compilation and/or publication of the C.P.I. shall be transferred to any other governmental department or bureau or agency or shall be
discontinued, then the index most nearly the same as the C.P.I. shall be used to make such calculations. In the event that Lessor and Lessee cannot agree on such alternative index, then the matter
shall be submitted for decision to the American Arbitration Association in the county in which the Premises are located, in accordance with the then rules of said association and the decision of the
arbitrators shall be binding upon the parties, notwithstanding one party failing to appear after due notice of the proceeding. The cost of said Arbitrators shall be paid equally by Lessor and Lessee. 

1

 

    (d) Lessee shall continue to pay the rent at the rate previously in effect until the increase, if any, is determined. Within five (5) days following the date on
which the increase is determined, Lessee shall make such payment to Lessor as will bring the increased rental current, commencing with the effective date of such increase through the date of any
rental installments then due. Thereafter the rental shall be paid at the increased rate. In the event the increase is not determined and calculated on or before December 31 of the year of
increase then the Base Rent for the following year shall be the same as the previous year's Base Rent. 

4.  (NOT USED)  

5.  USE  

    5.1  Use of Premises.  The premises shall be used and occupied for general office purposes relating to
the conduct of Deposits, Lending, Accounting and Collection and any other purpose consistent with the operation of a financial institution business in a
manner consistent and in compliance with all applicable ordinances and other governmental requirements affecting the Premises, and the Rules and Regulations attached hereto and all additions to such
Rules and Regulations as Lessor may from time to time reasonably adopt for the safety, care, and cleanliness of the Premises or the preservation of good order, and for no other purpose whatsoever
without the express written consent of Lessor, which consent shall not be unreasonably withheld. 

    5.2  Compliance with Law.  

    (a) Lessor
warrants to Lessee that, to the best of Lessor's actual knowledge and belief the Premises, on January 1, 1999, does not violate any covenants or
restrictions of record or any applicable building codes, regulations, or ordinances in effect as of such date. In the event it is determined that this warranty has been violated, then it shall be the
obligation of Lessor, after written notice from Lessee, to promptly, at Lessor's sole cost and expense, to rectify any such violation. 

    (b) Lessee
shall, at Lessee's expense, comply promptly with all applicable statutes, ordinances, rules, regulations, orders, and requirements in effect during the term
or any part of the term hereof regulating the use by Lessee of the Premises. Lessee shall not use or permit the use of the Premises in any manner that will tend to create waste or a nuisance or, if
there shall be more than one tenant of the Premises, which shall tend to disturb such other tenants. 

6.  MAINTENANCE, REPAIRS, AND ALTERATIONS  

    6.1  Lessor's Obligations.  Lessor shall, during the term of this Lease, maintain, or cause to be
maintained, in good order, condition, and repair, the building, including, without limitation, the Premises interior and exterior walls, the roof, and the windows, any equipment whether used
exclusively for the Premises, or in common with other Premises, including, without limitation, the HVAC, electrical, or plumbing ("Building Maintenance"), as well as all parking areas, driveways,
sidewalks, private roads or streets, landscaping, signs (with the exception of Lessee's signs as provided for in Paragraph 16.8 hereof) or other areas located within the site (such
non-building areas being herein referred to as "Common Areas" and the maintenance thereof being sometimes herein referred to as "Common Area Maintenance"). 

    Not
withstanding the provisions of this Paragraph 6.1, Lessor shall not be responsible for any repairs or maintenance of the premises, including walls, doors, and windows, if
said repairs and/or maintenance results from the action of Lessee, its employees, agents, contractors or other invites. 

    6.2  Lessee's Obligations.  Lessee shall, during the term of this Lease, keep in good order, condition,
and repair, the interior of the Premises and every part thereof. Except in the event of Lessor's negligence, or damages resulting from the failure of Lessor to perform its obligations set forth in
Paragraph 6.1 hereof, Lessee shall be responsible for the cost of painting, repairing, or replacing wall 

2

 

coverings, and to repair or replace any Premises improvements that are not ordinarily a part of the Building. Except as provided in Paragraph 6.1 above and this Paragraph 6.2, or set
forth in Paragraph 10 hereof, Lessee shall not be responsible for any operating costs whatsoever. 

    6.3  Surrender.  On the last day of the term hereof, or on any sooner termination, Lessee shall surrender
the Premises to Lessor in good order and condition, broom clean, ordinary wear and tear excepted. Lessee shall repair any damage to the Premises occasioned by the removal of Lessee's trade fixtures,
furnishings and equipment, which repair shall include the patching and filling of holes and repair of structural damage. 

    6.4  Alterations and Additions.  

    (a) Lessee
shall not, without Lessor's prior written consent, which consent shall not be unreasonably withheld, make any alterations, improvements, additions, utility
installations or repairs in, on or about the Premises. As used in this paragraph 6.4 the term "Utility Installation" shall mean, power panels, electrical distribution systems, lighting
fixtures, air conditioning, plumbing, and telephone and telecommunication wiring. As a condition of approval, Lessor may require the removal at the expiration of the term of this Lease of any or all
of said alterations, improvements, additions or Utility Installations, (except for telephone and telecommunication wiring). Should Lessor permit Lessee to make its own alterations, improvements,
additions or Utility Installations, Lessee shall use only such
contractor as has been expressly approved by Lessor. Should Lessee make any alterations, improvements, additions or Utility Installations without the prior approval of Lessor, or use a contractor not
expressly approved by Lessor, Lessor may, at any time during the term of this Lease, require that Lessee remove any part or all of the same. 

    (b) Any
alterations, improvements, additions or Utility Installations in or about the Premises that Lessee shall desire to make shall be presented to Lessor in written
form, with proposed detailed plans. If Lessor shall give its consent (which consent shall not be unreasonably withheld) to Lessee's making such alteration, improvement, addition or Utility
Installation, the consent shall be deemed conditioned upon Lessee acquiring a permit unless waived by Lessor to do so from the applicable governmental agencies, furnishing a copy thereof to Lessor
prior to the commencement of the work, and compliance by Lessee with all conditions of said permit in a prompt and expeditious manner. If Lessor fails to object to the submitted plans within
15 days from receipt thereof, said plans shall be deemed approved. 

    (c) Lessee
shall pay, when due, all claims for labor or materials furnished or alleged to have been furnished to or for Lessee at or for use in the Premises, which
claims are or may be secured by any mechanic's or materialmen's lien against the Premises, or the Office Building Project, or any interest therein. 

    (d) Lessee
shall give Lessor not less than five (5) days notice prior to the commencement of any work in the Premises by Lessee, and Lessor shall have the right
to post notices of non-responsibility in or on the Premises as provided by law. If Lessee shall, in good faith, contest the validity of any such lien, claim or demand, then Lessee shall, at its sole
expense defend itself and Lessor against the same and shall pay and satisfy any such adverse judgment that may be rendered thereon before the enforcement thereof against the Lessor or the Premises, or
the Office Building Project, upon the condition that if Lessor shall require, Lessee shall furnish to Lessor a surety bond satisfactory to Lessor in an amount equal to such contested lien claim or
demand indemnifying Lessor against liability for the same and holding Premises, and the Office Building Project free from the effect of such lien or claim. In addition, Lessor may require Lessee to
pay Lessor's reasonable attorneys' fees and costs in participating in such action if Lessor shall decide it is to Lessor's best interest so to do. 

3

 

    (e) All alterations, improvements, additions and Utility Installations (whether or not such Utility Installations constitute trade fixtures of Lessee), which may be
made to the Premises by Lessee, including but not limited to, floor coverings, paneling, doors, drapes, built-ins, moldings, sound attenuation, and lighting systems, conduit, wiring and outlets, shall
be made and done in a good and workmanlike manner and of good and sufficient quality and materials and shall be the property of Lessor and remain upon and be surrendered with the Premises at the
expiration of the Lease term, unless Lessor requires their removal pursuant to paragraph 6.4 (a). Provided Lessee is not in default, notwithstanding the provisions of this
paragraph 6.4(e), Lessee's personal property and equipment, other than that which is affixed to the Premises so that it cannot be removed without material damage to the Premises or the
Building, and other than Utility Installations, shall remain the property of Lessee and
may be removed by Lessee. It is understood and agreed that any existing partitions which are removed by Lessee subject to the provision of this Paragraph 6.4 shall not have to be restored by
Lessee. 

    (f)  Lessee
shall provide Lessor with as-built plans and specifications for any alterations, improvements, additions or Utility Installations. 

    (g) Notwithstanding
the other provision of this Paragraph 6.4 Lessee may without Lessor's approval make non-structural alterations, improvements,
additions and utility installations to the interior of the premises so long as they do not involve relocating or permanently removing the ceiling or any existing walls and the cumulative cost thereof
during the term of this Lease does not exceed $50,000.00. 

7.  INSURANCE; INDEMNITY  

    7.1  Liability Insurance.  Lessor shall obtain and keep in force during the term of this Lease
comprehensive public liability insurance insuring Lessor and Lessee against any liability arising out of the ownership, use, occupancy, or maintenance of the Premises, the Building and all common
areas. Such insurance shall be in the amount of not less than One Million Dollars ($1,000,000.00) combined single limit. The limits of said insurance shall not, however, limit the liability of Lessee
hereunder. 

    7.2  Property Insurance.  Lessor shall obtain and keep in force during the term of this Lease a policy or
policies of insurance covering loss or damage to the Building, in the amount of the full replacement value thereof, against all perils, included within the classification of fire, extended coverage,
vandalism, malicious mischief, special extended perils (all risk) and sprinkler leakage. Said insurance shall provide for payment of loss thereunder to Lessor or to the holder of a first mortgage or
deed of trust on the Premises as their interest may appear. Lessor may, in addition, obtain and keep in force during the term of this Lease a policy of rental income insurance, with loss payable to
Lessor. Lessee shall not do or permit to be done anything which shall invalidate the insurance policies referred to in this Paragraph 7.2. 

    7.3  Waiver of Subrogation.  Notwithstanding any contrary provision of this Lease, Lessee and Lessor each
hereby waive any and all rights of recovery against the other, or against the officers, employees, agents, and representatives of the other, for the loss of or damage to such waiving party or its
property or the property of others under its control to the extent that such loss or damage is insured against under any insurance policy in force at the time of such loss or damage. The insuring
party shall, upon obtaining the policies of insurance required hereunder, give notice to the insurance carrier or carriers that the foregoing mutual waiver of subrogation is contained in this Lease. 

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

    7.5  Exemption of Lessor from Liability.  Except for any injury resulting from the negligence of Lessor,
Lessee hereby agrees that Lessor shall not be liable for injury to Lessee's business or any loss of income therefrom or for damage to the goods, wares, merchandise or other property of Lessee,
Lessee's employee's, invitee customers, or any other person in or about the Premises, nor shall Lessor be liable for injury to the person of Lessee, Lessee's employees, agents, or contractors, whether
such damage or injury is caused by or results from fire, steam, electricity, gas, water or rain, or from the breakage, leakage, obstruction, or other defects of pipes, sprinklers, wires, appliances,
plumbing, air conditioning, or lighting fixtures or from any other cause, whether the said damage or injury results from conditions arising upon the premises or upon other portions of the building of
which the Premises are a part, or from other sources or places, and regardless of whether the cause of such damage or injury or the means of repairing the same is inaccessible. 

    7.6  Lessee's Insurance.  Lessee agrees, at its sole expense, to procure and maintain public liability
insurance for the leased property during the term of this Lease in the minimum amount of Two Million Dollars ($2,000,000.00) combined single limit, and such insurance policy shall name Lessor as an
additional insured. Prior to taking occupancy of the Leased Property, Tenant shall furnish Lessor with a certificate acceptable to Lessor, evidencing the existence of such insurance, naming Lessor as
an additional insured and certifying that such insurance may not be cancelled or coverage diminished without at least thirty (30) days' prior written notice to Lessor. Thereafter, at least ten
(10) days prior to the expiration of any such insurance, Lessee shall furnish Lessor with a certificate, in the form described above, evidencing the renewal or replacement of such insurance. 

8.  DAMAGE OR DESTRUCTION  

    8.1  Partial Damage—Insured.  Subject to the provisions of Paragraph 8.4 hereof, if
the Premises are damaged and such damage was caused by a casualty covered under an insurance policy required to be
maintained pursuant to Paragraph 7.2 hereof, Lessor shall at Lessor's expense repair such damage as soon as reasonably possible and this Lease shall continue in full force and effect. 

    8.2  Partial Damage—Uninsured.  Subject to the provisions of Paragraph 8.4, if at any
time during the term hereof the Premises are damaged, except by a negligent or willful act of Lessee, and such damage was caused by a casualty not covered under an insurance policy required to be
maintained pursuant to Paragraph 7.2. Lessor may at Lessor's option either (i) repair such damage as soon as reasonably possible at Lessor's expense, in which event this Lease shall
continue in full force and effect, or (ii) give written notice to Lessee within thirty (30) days after the date of the occurrence of such damage of Lessor's intention to cancel and
terminate this Lease as of the date of the occurrence of such damage. In the event Lessor elects to give such notice of Lessor's intention to cancel and terminate this Lease, Lessee shall have the
right within ten (10) days after the receipt of such notice to give written notice to Lessor of Lessee's intention to repair such damage at Lessee's expense, without reimbursement from Lessor,
in which event this Lease shall continue in full force and effect, and Lessee shall proceed to make such repairs as soon as reasonably possible. If Lessee does not give such 

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notice within such ten (10) day period, this Lease shall be cancelled and terminated as of the date of the occurrence of such damage. 

    8.3  Damage Near End of Term.  If the Premises are partially destroyed or damaged during the last six
months of the term of this Lease, or any renewal thereof, Lessor may at Lessor's option terminate this Lease as of the date of occurrence of such damage by giving written notice to Lessee of Lessor's
election to do so within thirty (30) days after the date of occurrence of such damage, provided, however, if the term of this Lease has been extended for any reason whatsoever, Lessor's right
to terminate this Lease shall only apply during the last six (6) months of the then current term of this Lease. 

    8.4  Abatement of Rent; Lessee's Remedies.  

    (a) If
the Premises are partially destroyed or damaged, and Lessor or Lessee repairs or restores them pursuant to the provisions of this Paragraph, the rent payable
under Paragraph 3 for the period during which such damage, repair, or restoration continues shall be abated in the proportion that the area of the Premises rendered unusable by such damage
bears to the total area of the Premises. Except for abatement of rent, if any, Lessee shall have no claim against Lessor for any damage suffered by reason of any such damage, destruction, repair or
restoration. 

    (b) If
Lessor shall be obligated to repair or restore the Premises under the provisions of Paragraph 8.1, or if Paragraph 8.2 hereof is applicable, and
Lessor shall not have commenced such repair or restoration
within ninety (90) days after such destruction or damage, or such repairs, in Lessee's opinion, cannot be completed within 120 days of the commencement of repair or alteration Lessee
may, at Lessee's option: 

    (1) Cancel
and terminate this Lease by giving Lessor written notice of Lessee's election to do so at any time prior to the commencement of such repair or restoration.
In such event, this Lease shall terminate as of the date of such notice Any abatement in rent shall be computed as provided in Paragraph 8.4(a) hereof or, 

    (2) Make
such repairs or restoration and deduct the cost of such repairs or restoration from the rent due under Paragraph 3 hereof. 

    8.5  Total Destruction.  If at any time during the term hereof the Premises are totally destroyed from
any cause, whether or not covered by the insurance required to be maintained by Lessor pursuant to Paragraph 7.2 (including any total destruction required by any authorized public authority),
this Lease shall automatically terminate as of the date of such total destruction. For purposes of this Paragraph, total destruction of the Building shall be damage or destruction, the coat of repair
of which shall in Lessor's reasonable judgement, exceed fifty percent (50%) of the then replacement value of the Building and shall not require that the Premises be totally or partially destroyed or
damaged. 

    8.6  Insurance Proceeds Upon Termination.  If this Lease is terminated pursuant to any right given Lessee
or Lessor to do so under this Paragraph 8, all insurance proceeds payable with respect to the damage giving rise to such right to termination shall be paid to Lessor or any encumbrancer of the
premises, as their interests may appear. 

    8.7  Restoration.  Except if such damage or destruction is caused by the negligence of Lessor, Lessor's
obligation to restore shall not include the restoration or replacement of Lessee's trade fixtures, equipment, merchandise, or any improvements or alterations made by Lessee to the Premises. 

9.  PERSONAL PROPERTY TAXES  

    Lessee
shall pay prior to delinquency all taxes assessed against and levied upon trade fixtures, furnishings, equipment, and all other personal property of Lessee contained in the
Premises or 

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elsewhere. When practicable, Lessee shall cause said trade fixtures, furnishings, equipment, and all other personal property to be assessed and billed separately from the real property of Lessor. 

10.  UTILITIES  

    Lessee
shall pay for all electrical, telephone, and janitorial services supplied to the Premises, together with any taxes thereon. Except for any failure or interruption of utility
services resulting from the negligence of Lessor, Lessor shall not be liable in damages or otherwise for any failure or interruption of any utility services being furnished to the Building. Lessor
shall use reasonable efforts to diligently remedy any interruption in the furnishing of such services. If said service interruption results from an action or failure to act on the part of Lessor and
said interruption continues for a continuous period of more than sixty (60) hours, Lessee shall be entitled to an abatement of rent for the period of time that said utility services have been
unavailable. In the event the utility services being furnished to the Premises are interrupted and are not available for a continuous period of thirty (30) days or more, Lessee shall have the
right to terminate this Lease. 

11.  ASSIGNMENT AND SUBLETTING  

    11.1  Lessor's Consent Required.  Lessee shall not voluntarily or by operation of law assign, transfer,
mortgage, sublet, or otherwise transfer or encumber all or any part of Lessee's interest in the Lease or in the Premises, without Lessor's prior written consent, which Lessor shall not unreasonably
withhold. Lessor shall respond to Lessee's request for consent hereunder in a timely manner and any attempted assignment, transfer, mortgage, encumbrance or subletting without such consent shall be
void, and shall constitute a breach of this Lease without the need for notice to Lessee under Paragraph 12.1. If Lessee desires at any time to assign this Lease or to sublet the Premises or any
portion thereof, it shall first notify Lessor of its desire to do so and shall submit in writing to Lessor (i) the name of the proposed subtenant or assignee; (ii) the nature of the
proposed subtenant's or assignee's business to be carried on in the Premises; (iii) the terms and provisions of the proposed sublease or assignment; and (iv) such reasonable financial
information as Lessor may request concerning the proposed subtenant or assignee, including, but not limited to, a balance sheet of the proposed subtenant or assignee as of a date within ninety
(90) days of the request for Lessor's consent, statements of income or profit and loss of the proposed subtenant or assignee for the two year period preceding the request for Lessor's consent,
and a written statement in reasonable detail as to the business experience of the proposed subtenant or assignee during the five (5) years preceding the request for Lessor's consent.
Notwithstanding the foregoing if Lessee is not relieved of any continuing liability under the terms of this Lease, the requirements of Paragraph 11.1 (IV) shall be waived. In the event
said assignment or sublease by Lessee is at a rental rate which is greater than that being paid to Lessor, such excess shall be divided one-half to Lessor and one-half to
Lessee. Lessor, however, retains the option to relieve Lessee of any continuing liability under the terms of this Lease, in which case said excess rental shall be paid 100% to Lessor. 

    11.2  Terms and Conditions of Assignment.  Regardless of Lessor's consent, no assignment shall release
Lessee of Lessee's obligations hereunder or alter the primary liability of Lessee to pay the Base Rent and to perform all other obligations to be performed by Lessee hereunder. Lessor may accept rent
from any person other than Lessee pending approval or disapproval of such assignment. Neither a delay in the approval or disapproval of such assignment nor the acceptance of rent shall constitute a
waiver or estoppel of Lessor's right to exercise its remedies for the breach of any of the terms or
conditions of this Paragraph 11 or this Lease. Consent to one assignment shall not be deemed consent to any subsequent assignment. In the event of default by any assignee of Lessee or any
successor of Lessee in the performance of any of the terms hereof, Lessor may proceed directly against Lessee without the necessity of exhausting remedies against said assignee, unless Lessee has been
relieved of liability hereunder pursuant to provisions of Paragraph 11.1. 

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    11.3  Assignee Lessee Affiliate.  Notwithstanding the provisions of Paragraph 11.1 hereof, Lessee
may assign or sublet the Premises, or any portion thereof, without Lessor's consent, to any corporation which controls, is controlled by or is under common control with Lessee, or to any corporation
resulting from the merger or consolidation with Lessee or to any person or entity which acquires all the assets of Lessee as a going concern of the business that is being conducted on the Premises,
all of which are referred to as "Assignee Lessee Affiliate," provided that before such assignment shall be effective said assignee shall assume, in full, the obligations of Lessee under this Lease.
Any such assignment shall not, in any way, affect or limit the liability of Lessee under the terms of this Lease even if after such assignment or subletting the terms of this Lease are materially
changed or altered with the approval of Assignee Lessee Affiliate and without the consent of Lessee, the consent of whom shall not be necessary. 

12.  DEFAULTS; REMEDIES  

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

    (a) The
failure of Lessee to make any payment of rent or any other payment required to be made by Lessee hereunder as and when due, where such failure shall continue
for a period of five (5) days after written notice thereof from Lessor to Lessee; provided, however, that any such notice shall be in lieu of, and not in addition to, any notice required under
California Code of Civil Procedure Section 1161. 

    (b) The
failure by Lessee to observe or perform any of the covenants, conditions or provisions of this Lease to be observed or performed by Lessee, other than as
described in Paragraph 12.1(a) hereof, where such failure shall continue for a period of thirty (30) days after written notice thereof from Lessor to Lessee; provided, however,
that any such notice shall be in lieu of, and not in addition to, any notice required under California Code of Civil Procedure Section 1161; provided further, that if the nature of Lessee's
default is such that more than thirty (30) days are reasonably required for its cure, then Lessee shall not be deemed to be in default if Lessee commenced such cure within said thirty
(30) day period and thereafter diligently prosecutes such cure to completion. 

    (c) The
making by Lessee of any general assignment, or general arrangement for the benefit of creditors; the filing by or against Lessee of a petition to have Lessee
adjudged bankrupt or a petition for reorganization or arrangement under any law relating to bankruptcy (unless, in the case of a petition filed against Lessee, the same is dismissed within sixty
(60) days); the appointment of a trustee or receiver to take possession of substantially all of Lessee's assets located at the Premises, or of Lessee's interest in this Lease, where possession
is not restored to Lessee within thirty (30) days; or the attachment, execution or other judicial seizures of substantially all of Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where such seizure is not discharged within thirty (30) days. 

    12.2  Remedies for Default of Lessee.  In the event of any material default by Lessee as defined in
Paragraph 12.1 hereof, Lessor my at any time thereafter, upon notice and demand and without limiting Lessor in the exercise of any other right or remedy which Lessor may have by reason of such
default or breach: 

    (a) Terminate
Lessee's right to possession of the Premises by any lawful means, in which case this Lease shall terminate and Lessee shall immediately surrender
possession of the Premises to Lessor. In such event, Lessor shall be entitled to recover from Lessee: 

    (1) The
worth at the time of award of the unpaid rent which has been earned at the time of termination; 

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    (2) 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 Lessee proves could have been reasonably avoided; 

    (3) The
worth at the time of award of the amount which the unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss that
Lessee proves could be reasonably avoided; and 

    (4) Any
other amount necessary to compensate the Lessor for all the detriment proximately caused by Lessee's failure to perform its obligations under this Lease or
which in the ordinary course of things would be likely to result therefrom, including, but not limited to, the cost of recovering possession of the Premises, expenses of reletting including necessary
renovation and alteration of the Premises, reasonable attorney's fee, and any other reasonable cost. 

    The
"worth at the time of award" of the amounts referred to in subparagraphs (1) and (2) above shall be computed by allowing interest at ten percent (10%) per annum. The
worth at the time of award of the amount referred to in subparagraph (3) above shall be computed by discounting such amount at one (1) percentage point above the discount rate of the Federal
Reserve Bank of San Francisco at the time of award. 

    (b) Pursue
any other remedy now or hereafter available to Lessor under the laws or judicial decisions of the State of California, including without limitation, the
remedy provided in California Civil Code Section 1951.4 to continue this Lease in effect. 

    12.3  Default by Lessor.  The failure of Lessor to perform any obligation of Lessor under this Lease
shall constitute a material default and breach of this Lease by Lessor. Notwithstanding the foregoing, Lessor shall not be in default unless Lessor fails to perform obligations required of Lessor
within a reasonable time, but in no event later than thirty (30) days after written notice by Lessee to Lessor and to the holder of any first mortgage or deed of trust covering the Premises
whose names and addresses shall have theretofore been furnished to Lessee in writing, specifying wherein Lessor has failed to perform such obligations; provided, however, that if the nature of
Lessor's obligations is such that more than thirty (30) days are required for performance then Lessor shall not be in default if Lessor commences performance within such 30-day
period and thereafter diligently prosecutes the same to completion. In the event of any such default by Lessor, Lessee may pursue any remedy now or hereafter available to Lessee under the laws or
judicial decisions of the State of California, except that Lessee shall not have the right to terminate this Lease except as expressly provided in this Lease. 

    12.4  Late Charges.  Lessee hereby acknowledges that the late payment by Lessee to Lessor of rent and
other sums due hereunder will cause Lessor to incur costs not contemplated by this Lease, the exact amount of which will be extremely difficult to ascertain. Such costs include, but are not limited
to, processing and accounting charges, and late charges which may be imposed on Lessor by the terms of any mortgage or trust deed covering the Premises. Accordingly, if any installment of rent or any
other sum due from Lessee shall not be received by Lessor or Lessor's designee within ten (10) days of the date due, then Lessee shall pay to Lessor a late charge equal to five percent (5%) of
such overdue amount. The parties hereby agree that such late charge represents a fair and reasonable estimate of the cost Lessor will incur by reason of late payment by Lessee. Acceptance of such late
charge by Lessor shall in no event constitute a waiver of Lessee's default with respect to such overdue amount, nor prevent Lessor from exercising any of the other rights and remedies granted
hereunder. 

13  CONDEMNATION OR RESTRICTION ON USE  

    13.1  Termination of Lease on Total Taking.  In the event the entire Premises or leasehold interest shall
be appropriated or taken under the power of eminent domain by any public or quasi-public authority for any period of time, this Lease shall terminate as of the date of such taking. 

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    13.2  Lessee's Election to Terminate on Partial Taking.  In the event more than ten percent (10%) of the
floor area of the Premises or more than thirty percent (30%) of the adjacent parking facility is taken under the power of eminent domain by any public or quasi-public authority, and if by reason of
any such appropriation or taking, regardless of the amount so taken, the remainder of the Premises or parking facility is not reasonably suitable for the operation of Lessee's business taking into
account Lessor's obligation to restore under Paragraph 13.4. Lessee shall have the right to terminate this Lease as of the date of such taking upon giving to Lessor notice in writing of such
election within one hundred twenty (120) days after such appropriation or taking. 

    13.3  Each Party Entitled to Award.  If this Lease is terminated in the manner provided in
Paragraph 13.1 or 13.2 hereof, each party shall be entitled to any award made to it in such proceedings; Lessee shall specifically be entitled to that portion of any award attributable to
unamortized expenditures made by Lessee for improvements to the Premises. The unamortized portion of the Lessee's expenditures for improving the Premises shall be determined by multiplying such
expenditures by a fraction, the numerator of which shall be the number of years of the term of this Lease which shall not have expired at the time of such appropriation or taking, and the denominator
of which shall be the number of years of the term of this Lease which shall not have expired at the time of improving the Premises. In no event shall options to renew or extend be taken into
consideration in determining the payment to be made to the Lessee. Lessee's right to receive compensation or damages for its fixtures and personal property shall not be affected in any manner thereby.
The rent for the last month of Lessee's occupancy shall be prorated and Lessor agrees to refund to Lessee any unearned rent paid in advance. 

    13.4  No Termination—Repairs and Rent Reduction.  In the event of a taking that does not
result in a termination of this Lease under Paragraph 13.1 hereof, then Lessor shall, at Lessor's cost and expense, restore the Premises or the parking facility remaining to a complete unit of
the quality and character as existed prior to such appropriation or taking, and thereafter, the rent provided for in Paragraph 3 hereof shall be reduced in the ratio that the floor area of the
Premises taken bears to the floor area of the Premises before such taking, and Lessor shall be entitled to receive the total award of compensation in such proceedings, including any amount awarded to
Lessee; provided, however, that Lessee shall receive and retain any amount awarded to Lessee as compensation for the taking of fixtures and equipment owned by Lessee or for the expense of removal or
repair of same. 

    13.5  Notice of Condemnation.  Lessor agrees immediately after it receives notice of the intention of any
such authority to appropriate or take to give to Lessee notice in writing of such fact. 

    13.6  Voluntary Sale as Taking.  A voluntary sale by Lessor to any public body or agency having the power
of eminent domain, either under threat of condemnation or while condemnation proceedings are pending, shall be deemed to be a taking under the power of eminent domain for the purposes of this
Paragraph 13. 

14.  BROKERS  

    Lessor
and Lessee represent and warrant that they have neither incurred nor are aware of any brokers', finders', or similar fee in connection with the origin, negotiation, execution
or performance of this Lease and agree to indemnify and hold harmless each other from any loss, liability, damage, cost or expense incurred by reason of breach of these representations and warranties. 

15.  LESSOR'S LIABILITY  

    15.1  The term "Lessor" as used herein, shall mean only the owner or owners at the time in question of the fee title or
a Lessee's interest in a ground lease of the Premises. In the event of any transfer of such title or interest, Lessor herein named (and in case of any subsequent transfers in the then grantor) shall
be relieved from and after the date of such transfer of all liability as respects Lessor's obligations thereafter to be performed, provided that any funds in the hands of Lessor or the 

10

 

then grantor at the time of such transfer, in which Lessee has an interest, then shall be delivered to the grantee. The obligations contained in this Lease to be performed by Lessor, shall, subject as
aforesaid, be binding on Lessor's successors and assigns only during their respective periods of ownership. 

16.  GENERAL PROVISIONS  

    16.1  Estoppel Certificate  

    (a) Lessee
shall at any time upon not less than ten (10) days prior written notice from Lessor execute, acknowledge and deliver to Lessor a statement in writing
(i) certifying that this Lease is unmodified and in full force and effect (or, if modified, stating the nature of such modification and certifying that this Lease, as so modified, is in full
force and effect) and the date to which the rent and other charges are paid in advance, if any, and (ii) acknowledging that there are not, to Lessee's knowledge, any uncured defaults on the
part of Lessor hereunder, or specifying such defaults if any are claimed. Any such statement may be conclusively relied upon by any prospective purchaser or encumbrancer of the Premises. 

    (b) Lessee's
failure to deliver such statements, within such time shall be conclusive upon Lessee (i) that this Lease is in full force and effect, without
modification except as may be represented by Lessor, (ii) that there are no uncured defaults in [MISSING TEXT] has been paid in advance. 

    (c) Not
more than once a year during the term of this Lease, if Lessor desires to finance or refinance the Premises, or any part thereof, Lessee hereby agrees to
deliver to any lender designated by Lessor such financial statements of Lessee as may be reasonably required by such lender. All such financial statements shall be received by Lessor in confidence and
shall be used only for the purposes herein set forth. 

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

    16.3  Time of Essence.  Time is of the essence in the performance of all terms and conditions of this
Lease. 

    16.4  Captions.  Item and paragraph captions have been used solely as a matter of convenience and such
captions in no way define or limit the scope or intent of any provision of this Lease. 

    16.5  Notices.  Any notice required or permitted to be given hereunder shall be in writing and may be
served personally or by regular mail, return receipt requested, addressed to Lessor and Lessee respectively at the addresses set forth before their signatures in Item 12 of the Basic Lease Provisions,
or such other addresses as may from time to time be designated in writing by Lessor or Lessee by notice pursuant hereto. 

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

    16.7  Holding Over.  If Lessee remains in possession of the Premises or any part thereof after the
expiration of the term hereof without the express written consent of Lessor, such occupancy shall be a tenancy from month to month at a rental rate in the amount of the last monthly rental. 

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

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    16.9  Inurement; Choice of Law.  Subject to any provisions hereof restricting assignment or subletting by
Lessee and subject to the provisions of Paragraph 15 hereof, the terms and conditions contained in this Lease shall bind the parties, their personal representative, successors and assigns. This
Lease shall be governed by the Laws of the State of California. 

    16.10  Subordination and Non-Disturbance.  This Lease shall, at Lessor's option, be either
superior or subordinate to mortgages or deeds of trust on the Premises, whether now existing or hereafter created. Lessee shall upon written demand by Lessor execute such instruments as may be
required from time to time to subordinate the rights and interest of Lessee under this Lease to the lien of any mortgage or deed of trust, or, if requested by Lessor, to subordinate any such mortgage
or deed of trust to this Lease. Notwithstanding any such subordination, so long as Lessee is not in default hereunder, this Lease shall not be terminated or Lessee's quiet enjoyment of the Premises
disturbed in the event of such mortgage or acknowledges [MISSING TEXT] Lessee's security deposit, in the event of such foreclosure, Lessee shall thereupon become a Lessee of
and attorn to the successor-in-interest to Lessor on the same terms and conditions as are contained in this Lease. 

    16.11  Attorney's Fees.  If either party hereto brings an action to enforce the terms hereof or declare
rights hereunder, the prevailing party in any such action, on trial or appeal, shall be entitled to reasonable costs and attorney's fees to be paid by the losing party. For purposes of this provision,
in any action or proceeding instituted by Lessor based upon any default or alleged default by Lessee hereunder, Lessor shall be deemed the prevailing party if (a) judgement is entered in favor
of Lessor or (b) prior to trial or judgement, Lessee shall pay all or any portion of the rent and charges claimed by Lessor, eliminate the condition(s), cease the act(s) or otherwise
cure the omission(s) claimed by Lessor to constitute a default by Lessee hereunder. 

    16.12  Lessor's Access.  Upon a twenty-four (24) hour notice, Lessor and Lessor's agents shall
have the right to enter the Premises at reasonable times for the purpose of inspecting the same, showing the same to prospective purchasers, or lenders, and making such alterations, repairs,
improvements or additions to the Premises or to the building of which they are a part as Lessor may deem necessary or desirable. Lessor may at any time, place on or about the Premises any ordinary
"For Sale" signs and Lessor may at any time during the last one hundred eighty (180) days of the term hereof, place on or about the Premises any ordinary "For Sale," "For Lease," or similar
signs all without rebate of rent or liability to Lessee. Provided, however, that such "For Sale" or "For Lease" signs shall not be placed on the area of the building crosshatched in red on
Exhibit B attached hereto or on or in the landscaped area immediately south of said crosshatched area. Further provided, however, that said signs shall not in any instance interfere with any
signage of Lessee, as provided for in Paragraph 16.18 hereof. 

    16.13  Corporate Authority.  If Lessee 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 in accordance with its terms. If Lessee is a corporation, Lessee shall, within thirty (30) days
after execution of this Lease, deliver to Lessor a certified copy of a resolution of the Board of Directors of said corporation authorizing or ratifying the execution of this Lease. 

    16.14  Rights of Others.  Except as otherwise provided herein, nothing expressed or implied is intended,
or shall be construed, to confer upon or grant any person any rights or remedies under or by reason of any term or condition contained in this Lease. 

12

  

    16.15  Safety and Health.  Lessee covenants at all times during the term of the Lease to comply with the
requirements of the Occupational Safety and Health Act of 1970, 29 U.S.C. Section 651 et seq. and any analogous legislation in California (collectively, the "Act"), to the extent that
the Act applies to the Premises and any activities thereon and without limiting the generality of the foregoing, Lessee covenants to maintain all working areas, all machinery, structures, electrical
facilities and the like upon the Premises in such a condition that fully complies with the requirements of the Act, including such requirements as would be applicable with respect to agents,
employees, or contractors of Lessor who may from time to time be present upon the Premises, and Lessee agrees to indemnify and hold harmless Lessor from any liability, claims, or damages arising as a
result of a breach of the foregoing covenant and from all costs, expenses, and charges arising therefrom including, without limitation, attorney's fees and court costs incurred by Lessor in connection
therewith, which indemnity shall survive the expiration or termination of this Lease. 

    16.16  Surrender or Cancellation.  The voluntary or other surrender of this Lease by Lessee, or a mutual
cancellation thereof, shall not work a merger. 

    16.17  Entire Agreement.  This Lease covers in full each and every agreement of every kind or nature
whatsoever between the parties hereto concerning the Premises and the Building, and all preliminary negotiations and agreements of whatsoever kind or nature are merger herein. Lessor has made no
representations or promises whatsoever with respect to the Premises or the Building, except those contained herein; and no other person, firm or corporation has at any time had any authority from
Lessor to make any representations or promises on behalf of Lessor, and Lessee expressly agrees that if any such representations or promises have been made by others, Lessee hereby waives all right to
rely thereon. No verbal agreement or implied covenant shall be held to vary the provisions hereof, any statute, law or custom to the contrary notwithstanding. 

    16.18  Signs.  Lessee presently has signs on (a) the existing monument located on the lawn at the
southwest corner of the building, and (b) the upper portion of the southwest corner of the building. It is agreed that Lessee shall have the exclusive right to signs on the monument sign and on
the area of the south elevation of the building, cross-hatched in red on Exhibit B attached hereto. The area of the south elevation of the building cross-hatched in green on the attached
Exhibit B is reserved on a non-exclusive basis by Lessor for building identification signs applicable to Lessees. Any additional or revised signs by Lessee shall require the prior written
approval of Lessor and all governmental bodies having jurisdiction. All existing or additional signs are to be installed, maintained and removed at Lessee's sole cost and expense. 

    It
is the intent of Lessor and Lessee that Lessee's signage, because of Lessee's dominant position in the building, shall be dominant at all times. It is agreed that, in addition to
the restrictions in the previous paragraph on where Lessor may erect additional signs, Lessor agrees not to erect any signs on the
building which contain letters larger than 12 inches in height or any signs on the east side of the building without the prior written approval of Lessee. 

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

    16.20  Gender; Number.  Whenever the context of this Lease requires, the masculine gender includes the
feminine or neuter, and the singular number includes the plural. 

    16.21  Lease Not Subject to Levy.  This Lease and the interest of Lessee hereunder shall not be subject
to garnishment or sale under execution in any action or proceeding which may be brought against or by Lessee without the written consent of Lessor. 

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    16.22  Quitclaim.  At the expiration or earlier termination of this Lease, Lessee shall execute,
acknowledge, and deliver to Lessor, within ten (10) days after written demand from Lessor, any quitclaim deed or other document reasonably required by any reputable title company to remove the
cloud of this Lease from the title of the real property subject to Lease. 

    16.23  Confidentiality of Lease.  Lessee acknowledges and agrees that the terms of this Lease are
confidential and constitute proprietary information of Lessor and Lessee. Disclosure of the terms hereof could adversely affect the ability of Lessor to negotiate other leases with respect to the
Building or impair Lessor's relationship with other tenants of the Building. Lessee agrees that it, and its partners, officers, directors, employees and attorneys shall not disclose the terms and
conditions of this Lease to any other person without the prior written consent of Lessor. It is understood and agreed that damages would be an inadequate remedy for the breach of this provision by
Lessee, and Lessor shall have the right to specific performance of this provision and to injunctive relief to prevent its breach or continued breach, provided, however, that Lessee shall have the
right to disclose terms and conditions of this Lease for any business related purpose on a confidential basis. 

17.  PARKING  

    During
the term of this Lease, Lessee shall have the right in common with other Lessees of the Building to use the parking area subject to such rules and regulations as may be
established from time to time by Lessor for the effective use of said parking area. Said rules and regulations may include, but shall not be limited to, such items as: designation of specific areas
for use by invites of Lessee, other Lessees and Lessor; hours during which said parking shall be open for use, use of a parking attendant; and such other matters affecting the parking operation to the
end that said facilities shall be utilized to maximum efficiency and in the best interest of Lessor, Lessee, other Lessees and their respective invites. Lessee shall have the right to approve any
change in existing rules and regulations, which approval shall not be unreasonably withheld. 

    Lessor
shall have the right at any time to designate specific spaces, of the parking area for use by Lessee, other Lessees, and their invites. Lessee shall have the right, provided
parking becomes a problem and the problem is not solved by Lessor to the satisfaction of Lessee within 30 days of written notice by Lessee to Lessor of said problem, to require Lessor to
designate specific areas of the parking lot for use by Lessee, other Lessees, and their invites. The designation of specific areas shall be done by Lessor in a fair and equitable manner but in said
event, Lessee shall be entitled to the exclusive use of at least 56 parking spaces. 

18.  RIGHT OF FIRST REFUSAL:  

    18.1  Lessee shall have, providing there is no default under any of the terms, covenants and conditions hereof, the
right during the term hereof to lease additional space within the Building subject to the following terms and conditions: 

	1.
	This
Right of First Refusal will apply to any space within the Building becoming available for lease as a result of the termination of any of the existing Leases. In the event an
existing lease is extended or renewed, The Right of First Refusal shall not apply to the portion of the Building covered by said extended or renewed Lease.

	2.
	Lessor
shall give Lessee notice of the availability of any such space not later than 120 days prior to the proposed availability.

	3.
	Lessee
shall notify Lessor of its intent to exercise its Right of First Refusal not later than 60 days prior to the date that such space shall become available.

	4.
	The
area upon which the Right of First Refusal is exercised shall be added to the Premises presently covered by this Lease at the per square foot rental then applicable and subject
to all of the other terms and conditions of said Lease. 

14

 

	5.
	If
a space does become available and is offered to Lessee under the terms of this Paragraph and said Right of First Refusal is not exercised by Lessee then the said Premises so
offered and refused shall again become subject to the terms of this Paragraph 18. 

19.  OPTION TO EXTEND LEASE TERM:  

    19.1  Option:  Lessee shall have an option to extend the lease term for five (5) years upon the
expiration of the initial term. 

    Said
option shall be exercised by Lessee giving Lessor written notice that it is exercising the sane no earlier than eight (8) and no later than six (6) months prior to
the date upon which this Lease would otherwise terminate if such option were not exercised. Any extended term hereof, pursuant to the exercise of said option or options shall be subject to all of the
terms, covenants and conditions of this Lease, save and except that the rental for the applicable extended term or terms shall be at the going and prevailing rent for the property of like character in
the same general vicinity for the same or a similar use as of the time of the commencement of the applicable extended term. The provisions of Paragraph 3.2 shall be applicable to any extended
term resulting from the exercise of the option. If the parties hereto shall be unable to agree between themselves as to the rental for the extended term or terms on said basis, then each shall select
an arbitrator, the two arbitrators so selected shall select a third arbitrator, and the three arbitrators shall determine the rental for the extended term or terms on the basis set forth above, and
the decision of a majority of them shall be binding and final upon both Lessor and Lessee who shall bear the cost of such arbitration in equal shares. If such arbitration is required, it shall be
conducted in accordance with the Code of Civil Procedure of the State of California. 

    19.2  Effect of Defaults on Option:  

    (a) Lessee
shall have no right to exercise this option, (i) during the time commencing from the date Lessor gives to Lessee a notice of default pursuant to
Paragraph 12.1 (b) or 12.1 (c) and continuing until the noncompliance alleged in said notice of default is cured, provided, however, if Lessee has commenced and is proceeding in a
timely manner to complete the cure, this paragraph (i) will not be applicable, or (ii) during the period of time commencing on the day after a monetary obligation to Lessor is due from
Lessee and unpaid (without any necessity for notice thereof to Lessee) and continuing until the obligation is paid, or (iii) in the event that Lessor has given to Lessee three or more notices
of default under Paragraph 12.1 (b) or Paragraph 12.1 (c), whether or not the defaults are cured during the 12 month period of time immediately prior to the time that
Lessee attempts to exercise the subject Option, or (iv) if Lessee has committed any noncurable breach or is otherwise in default of any of the terms, covenants or conditions of the Lease. 

    (b) The
period of time within which this Option may be exercised shall not be extended or enlarged by reason of Lessee's inability to exercise an Option because of the
provisions of Paragraph 19.2 (a) 

    (c) All
rights of Lessee under the provisions of this, Option shall terminate and be of no further force or effect, notwithstanding Lessee's due and timely exercise of
the Option, if, after such exercise and during the term of this Lease, (i) Lessee fails to pay to Lessor a monetary obligation of Lessee for a period of thirty (30) days after such
obligation becomes due (without any necessity of Lessor to give notice thereof to Lessee), or (ii) Lessee fails to commence to cure a default specified in Paragraph 12.1
(c) within thirty (30) days after the date that Lessor gives notice to Lessee of such default and/or Lessee fails thereafter to diligently prosecute said cure to completion, or
(iii) Lessor gives to Lessee three or more notices of default under Paragraph 12.1 (b) or Paragraph 12.1 (c), whether or not the defaults are cured, or (iv) if
Lessee has committed 

15

 

any non-curable breach or is otherwise in default of any of the terms, covenants and conditions of the Lease. 

	LESSOR:	 	LESSEE:
	

THE KLUSSMAN FAMILY TRUST	
 	

PACIFIC CREST BANK
	

By:	
 	

/s/ William P. Klussman
 Trustee	
 	

By:	
 	

/s/ Lyle C. Lodwick
 Executive Vice President

16

 
 

RULES AND REGULATIONS ATTACHED
  AND MADE A PART OF THIS LEASE

	1.
	No
sign, placard, drapery, picture, advertisement, name or notice shall be inscribed, displayed, printed, or affixed on or to any part of the outside of the Building without the
written consent of Lessor first obtained and Lessor shall have the right to remove any such sign, placard, picture, advertisement, name, or notice without notice to and at the expense of Lessee. 

All
approved signs or lettering on doors shall be printed, painted, affixed or inscribed at the expense of Lessee by a person approved of by Lessor. 

Lessee
shall not place anything or allow anything to be placed near the glass or any window, door, partition, or wall which may appear unsightly from outside the Premises, 

	2.
	The
bulletin board or directory of the Building, if any, will be provided exclusively for the display of the names and location of Lessees only and Lessor reserves the right to
exclude any other names therefrom.

	3.
	All
sidewalks, halls, passages, exits, entrances, and stairways of the Building, if any, shall not be obstructed by any Lessee or used by him for any purpose other than for ingress
to or egress from his respective Premises. The halls, passages, exits, entrances, stairways, balconies and roof are not for the use of the general public and the Lessor shall in all cases retain the
right to control and prevent access thereto by all persons whose presence, in the judgment of the Lessor, shall be prejudicial to the safety, character, reputation and interests of the Building and
its Lessees, provided that nothing herein contained shall be construed to prevent such access to persons with whom the Lessee normally deals in the ordinary course of Lessee's business unless such
persons are engaged in illegal activities. No Lessee and no employee or invitee of any Lessee shall go upon the roof of the Building without the prior consent of Lessor, which consent shall not be
unreasonably withheld. For purposes of Lessee' obligations, if any, of repair and maintenance of the heating, ventilating, and air conditioning systems of the Premises, Lessee shall use a maintenance
firm approved by Lessor, which approval shall not be unreasonably withheld.

	4.
	Lessee
shall not overload the floor of the Premises.

	5.
	Lessee
shall not use, keep, or permit to be used foul or noxious gas or substance in the Premises, or permit or suffer the Premises to be occupied or used in a manner offensive or
objectionable to the
Lessor or other occupants of the Building by reason of noise, odors, and/or vibrations, or interfere in any way with other Lessees or those having business therein, nor shall any animals or birds be
brought in or kept in or about the Premises or the Building.

	6.
	No
cooking shall be done or permitted by any Lessees on the Premises, with the exception of microwave or toaster ovens and coffee machines, nor shall the Premises be used for
washing clothes, for lodging, or for any improper, objectionable or immoral purposes.

	7.
	Lessee
shall not use or keep in the Premises or Building any kerosene, gasoline, inflammable or combustible fluid or material, or use any method of heating (other than incidental,
small, electrical space heaters) or air conditioning other than that supplied by Lessor.

	8.
	Lessor
will direct electricians as to where and how telephone and telegraph wires are to be introduced. No boring or cutting for wires will be allowed without the consent of Lessor
and the location of telephones, call boxes, and other office equipment affixed to the Premises shall be subject to the approval of Lessor, which consent and approval shall not be unreasonably
withheld.

	9.
	Each
Lessee, upon the termination of his tenancy, shall deliver to the Lessor the keys to offices, rooms, and toilet rooms which shall have been furnished the Lessee or which the
Lessee shall have had made and, in the event of loss of any keys so furnished, shall pay the Lessor therefor.

	10.
	Except
for tenant improvements set forth in this Lease, no Lessee shall 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 the Lessor. The expense of repairing any damage resulting from a violation of this rule or removal of any floor covering shall be borne by the Lessee by whom or by whose
contractors, employees, or invites the damage shall be caused. 

	11.
	On
Saturdays, Sundays, legal holidays, and on other days between the hours of 6:00 p.m. and 8:00 a.m., the following day, access to the Building or to the halls,
corridors, or stairways in the Building, if any, or to the Premises may be refused unless the person seeking access is known to be the person or employee of the Building in charge or has a pass or is
properly identified. The Lessor shall in no case be liable for damages for any error with regard to the admission to or exclusion from the Building during the continuance of the same by closing the
doors or otherwise, for the safety of the lessees and protection of property in the Building and the Building.

	12.
	Lessee
shall see that the doors of the Premises are closed and securely locked before leaving the Building and must observe strict care and caution that all water faucets or water
apparatus are entirely shut off before Lessee or Lessee's employees leave the Building so as to prevent waste or damage.

	13.
	Lessor
reserves the right to exclude or expel from the building any person who, in the judgment of Lessor, is intoxicated or under the influence of liquor or drugs or who shall in
any manner do any act in violation of any of the Rules and Regulations of the Building.

	14.
	Employees
of Lessor shall not perform any work or do anything outside of their regular duties unless under special instructions from the Lessor and no employee will admit any person
(Lessee or otherwise) to any office without specific instructions from the Lessor.

	15.
	Lessor
shall have the right, exercisable without notice and without liability to Lessee, to change the name of the Building of which the Premises are a part, providing that the
change has no effect on the signage provided in Paragraph 16.18.

	16.
	Lessor
shall not disturb, solicit, or canvass any occupant of the Building and shall cooperate to prevent same.

	17.
	Without
the written consent (which shall not be unreasonably withheld) of Lessor, Lessee shall not use the name of the Building in connection with or in promoting or advertising the
business of Lessee except as Lessee's address.

	18.
	Lessor
reserves the right to make such other and further nondiscriminatory Rules and Regulations as in its judgment may be necessary or desirable for the safety, care, and
cleanliness of the Premises and the Building and for the preservation of good order therein. Lessee agrees, upon receipt of written notification thereof, to abide by all such other and further Rules
and Regulations.

	19.
	Any
permitted corrosive, flammable, or other special wastes shall be handled for disposal as directed by Lessor.

	20.
	Lessee's
use of the common areas shall be limited to access and parking purposes and under no circumstances shall Lessee be permitted to store any goods or equipment, conduct any
operations or construct or place any improvements, barriers, or obstructions in the common areas, or otherwise adversely affect the appearance thereof. 

	/s/ [ILLEGIBLE]
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QuickLinks

EXHIBIT 10.12

BASIC LEASE PROVISIONS

TABLE OF CONTENTS

RULES AND REGULATIONS ATTACHED AND MADE A PART OF THIS LEASE

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