Document:

Exhibit 10.6
    

    
      

      
    

    
      STANDARD INDUSTRIAL/COMMERCIAL
      MULTI-TENANT LEASE - NET 
    

    
      AMERICAN INDUSTRIAL REAL ESTATE
      ASSOCIATION
    

    	
          
            1.
          

        	
          
            Basic Provisions (“Basic
            Provisions”)
          

        

    
      1.1    Parties: This Lease (“Lease”), dated for reference
      purposes only, October 1, 2004, is made by and between Little SM Holding, LLC
      (“Lessor”) and TAG
      Entertainment (“Lessee”), (collectively the
      “Parties”, or
      individually a “Party”).
    

    
      1.2(a)        Premises: That certain portion of the
      Project (as defined below), including all improvements therein or to be
      provided by Lessor under the terms of this Lease, commonly known by the street
      address of 9916 So. Santa Monica Blud., located in the City of Beverly Hills,
      County of Los Angeles, State of California, with zip code 90212, as outlined on
      Exhibit ______ attached hereto (“Premises”) and generally
      described as (describe briefly the nature of the Premises): 1st Floor (see
      exhibits).
    

    
      In addition to Lessee’s rights to
      use and occupy the Premises as hereinafter specified, Lessee shall have
      non-exclusive rights to the Common Areas (as defined in Paragraph 2.7 below) as
      hereinafter specified, but shall not have any rights to the roof, exterior
      walls or utility raceways of the building containing the Premises
      (“Building”) or to
      any other buildings in the Project. The Premises, the Building, the Common
      Areas, the land upon which they are located, along with all other buildings and
      improvements thereon, are herein collectively referred to as the
      “Project” (See
      also Paragraph 2)
    

    
      1.2(b)        Parking: 0 unreserved vehicle parking spaces
      (“Unreserved Parking Spaces”); and Ten (10) reserved vehicle parking spaces (“Reserved Parking Spaces”). (See
      also Paragraph 2.6)
    

    
      1.3    Term: Three (3) years and 0 months
      (“Original Term”)
      commencing October 1, 2004 (“Commencement
      Date”) and ending September 30, 2007
      (“Expiration Date”). (See also Paragraph 3)
    

    
      1.4    Early
      Possession: ______________ (“Early Possession Date”). (See
      also Paragraphs 3.2 and 3.3)
    

    
      1.5    Base
      Rent: $ 12,500 (YR 1) per month (“Base
      Rent”), payable on the First day of each month
      commencing October 1, 2004 (see exhibits). (See also Paragraph 4)
      
    

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

    
      1.6    Lessee’s
      Share of Common Area Operating Expenses: (see exhibits) percent (.50%)
      (“Lessee’s Share”).
    

    	
          
            1.7
          

        	
          
            Base Rent and Other Monies
            Paid Upon Execution:
          

        

    	
          
             
          

        	
          
            (a)
          

        	
          
            Base Rent: $ 12,000 for the
            period October 1, 2004 - October 31, 2004.
          

        

    	
          
             
          

        	
          
            (b)
          

        	
          
            Common Area Operating Expenses: $
            _____ for the period _________________.
          

        

    	
          
             
          

        	
          
            (c)
          

        	
          
            Security Deposit: $ 12,000
            (“Security Deposit”). (See also Paragraph 5) waived
          

        

    	
          
             
          

        	
          
            (d)
          

        	
          
            Other: $ ______ for
            ________________________________________________.
          

        

    	
          
             
          

        	
          
            (e)
          

        	
          
            Total Due Upon Execution of this
            Lease: $25,000.
          

        

    	
          
            1.8
          

        	
          
            Agreed Use: General Office. (See also Paragraph 6)
          

        	
          
             
          

        
	
          
            1.9
          

        	
          
            Insuring
            Party: Lessor is the “Insuring Party”. (See also
            Paragraph 8)
          

        
	
          
            1.10
          

        	
          
            Real Estate
            Brokers: (See also Paragraph 15)
          

        	
          
             
          

        
				

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

    

    
      o
      ______________________________ represents Lessor exclusively (“Lessor’s Broker”);
    

    
      o
      _____________________________ represents Lessee exclusively (“Lessee’s Broker”);
      or
    

    
      o
      _____________________________ represents both Lessor and Lessee
      (“Dual Agency”).
    

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

    
      1.11  Guarantor. The obligations of the Lessee
      under this Lease are to be guaranteed by
      ___________________________________________ (“Guarantor”). (See also Paragraph
      37)
    

    
      1.12  Addenda and Exhibits. Attached hereto is an
      Addendum or Addenda consisting of Paragraphs___________ through ____________
      and Exhibits___________ through _______, all of which constitute a part of this
      Lease.
    

    	
          
            2.
          

        	
          
            Premises.
          

        

    
      2.1    Letting. Lessor hereby leases to Lessee, and
      Lessee hereby leases from Lessor, the Premises, for the term, at the rental,
      and upon all of the terms, covenants and conditions set forth in this Lease.
      Unless otherwise provided herein, any statement of size set forth in this
      Lease, or that may have been used in calculating Rent, is an approximation
      which the Parties agree is reasonable and any payments based thereon are not
      subject to revision whether or not the actual size is more or
      less.
    

    
      2.2    Condition. Lessor shall deliver that portion
      of the Premises contained within the Building (“Unit”) to Lesses broom clean and
      free of debris on the Commencement Date or the Early Possession Date, whichever
      first occurs (“Start Date”), and, so long as the required service contracts described in
      Paragraph 7.1(b) below are obtained by Lessee and in effect within thirty days
      following the Start Date, warrants that the existing electrical, plumbing, fire
      sprinkler, lighting, heating, ventilating and air conditioning systems
      (“HVAC”), loading
      doors, if any, and all other such elements in the Unit, other than those
      constructed by Lessee, shall be in good operating condition on said date and
      that the structural elements of the roof, bearing walls and foundation of the
      Unit shall be free of material defects. If a non-compliance with such warranty
      exists as of the Start Date, or if one of such systems or elements should
      malfunction or fall within the appropriate warranty period, Lessor shall, as
      Lessor’s sole obligation with respect to such matter, except as otherwise
      provided in this Lease, promptly after receipt of written notice from Lessee
      setting forth with specificity the nature and extent of such non-compliance
      malfunction or failure, rectify same at Lessor’s expense. The warranty
      periods shall be as follows: (i) 6 months as to the HVAC systems, and (ii) 30
      days as to the remaining systems and other elements of the Unit. If Lessee does
      not give Lessor the required notice within the appropriate warranty period,
      correction of any such non-compliance, malfunction or failure shall be the
      obligation of Lessee at Lessee’s sole cost and expense (except for the
      repairs to the fire sprinkler systems, roof, foundations, and/or bearing walls
      - see Paragraph 7). 
    

    
       
    

    

    
      2.3    Compliance. Lessor warrants that the
      improvements on the Premises and the Common Areas comply with the building
      codes that were in effect at the time that each such improvement, or portion
      thereof, was constructed, and also with all applicable laws, covenants or
      restrictions of record, regulations, and ordinances in effect on the Start Date
      (“Applicable Requirements”). Said warranty does not apply to the use
      to which Lessee will put the Premises or to any Alterations or Utility
      Installations (as defined in Paragraph 7.3(a)) made or to be made by Lessee.
      NOTE: Lessee is responsible for determining whether or not the Applicable
      Requirements, and especially the zoning, are appropriate for Lessee’s
      intended use, and acknowledges that past uses of the Premises may no longer be
      allowed. If the Premises do not comply with said warranty, Lessor shall, except
      as otherwise provided, promptly after receipt of written notice from Lessee
      setting forth with specificity the nature and extent of such non-compliance,
      rectify the same at Lessor’s expense. If Lessee does not give Lessor
      written notice of a non-compliance with this warranty within 6 months following
      the Start Date, correction of that non-compliance shall be the obligation of
      Lessee at Lessee’s sole cost and expense. If the Applicable Requirements
      are hereafter changed so as to require during the term of this Lease the
      construction of an addition to or an alteration of the Unit, Premises and/or
      Building, the remediation of any Hazardous Substance, or the reinforcement or
      other physical modification of the Unit, Premises and/or Building
      (“Capital Expenditure”), Lessor and Lessee shall allocate the cost of
      such work as follows:
    

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

    
      (b)     If
      such Capital Expenditure is not the result of the specific and unique use of
      the Premises by Lessee (such as, governmentally mandated seismic
      modifications), then Lessor and Lessee shall allocate the obligation to pay for
      the portion of such costs reasonably attributable to the Premises pursuant to
      the formula set out in Paragraph 7.1(d); provided, however, that if such
      Capital Expenditure is required during the last 2 years of this Lease or if
      Lessor reasonably determines that it is not economically feasible to pay its
      share thereof, Lessor shall have the option to terminate this Lease upon 90
      days prior written notice to Lessee unless Lessee notifies Lessor, in writing,
      within 10 days after receipt of Lessor’s termination notice that Lessee
      will pay for such Capital Expenditure. If Lessor does not elect to terminate,
      and falls to tender its share of any such Capital Expenditure, Lessee may
      advance such funds and deduct same, with interest, from Rent until
      Lessor’s share of such costs have been fully paid. If Lessee is unable to
      finance Lessor’s share, or if the balance of the Rent due and payable for
      the remainder of this Lease is not sufficient to fully reimburse Lessee on an
      offset basis, Lessee shall have the right to terminate this Lease upon 30 days
      written notice to Lessor.
    

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

    
      2.4    Acknowledgements. Lessee acknowledges that:
      (a) It has been advised by Lessor and/or Brokers to satisfy itself with respect
      to the condition of the Premises (including but not limited to the electrical,
      HVAC and the fire sprinkler systems, security, environmental aspects, and
      compliance with Applicable Requirements and the Americans with Disabilities
      Act), and their suitability for Lessee’s intended use, (b) Lessee has made
      such investigation as it deems necessary with reference to such matters and
      assumes all responsibility thereof as the same relate to its occupancy of the
      Premises, and (c) neither Lessor, Lessor’s agents, nor Brokers have made
      any oral or written representations or warranties with respect to said matters
      other than as set forth in this Lease. In addition, Lessor acknowledges that: (i) Brokers have made no
      representations, promises or warranties concerning Lessee’s ability to
      honor the Lease or suitability to occupy the Premises, and (ii) it is
      Lessor’s sole responsibility to investigate the financial capability
      and/or suitability of all proposed tenants.
    

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

    
      2.6     Vehicle
      Parking. Lessee shall be entitled to use the number
      of Unreserved Parking Spaces and Reserved Parking Spaces specified in Paragraph
      1.2(b) on those portions of the Common Areas designated from time to time by
      Lessor for parking. Lessee shall not use more parking spaces than said number.
      Said parking spaces shall be used for parking by vehicles no larger than
      full-size passenger automobiles or pick-up trucks, herein called
      “Permitted Size Vehicles.” Lessor may regulate the loading and unloading of vehicles by adopting
      Rules and Regulations as provided in Paragraph 2.9. No vehicles other than
      Permitted Size Vehicles may be parked in the Common Area without the prior
      written permission of Lessor.
    

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

    	
          
            (b)
          

        	
          
            Lessee shall not service or store
            any vehicles in the Common Areas.
          

        

    
      (c)     If
      Lessee permits or allows any of the prohibited activities described in this
      Paragraph 2.6, then Lessor shall have the right, without notice, in addition to
      such other rights and remedies that it may have, to remove or tow away the
      vehicle involved and charge the cost to Lessee, which cost shall be immediately
      payable upon demand by Lessor.
    

    
      2.7    Common Areas -
      Definition. The term “Common Areas” is defined as all areas
      and facilities outside the Premises and within the exterior boundary line of
      the Project and interior utility raceways and installations within the Unit
      that are provided and designated by the Lessor from time to time for the
      general non-exclusive use of Lessor, Lessee and other tenants of the Project
      and their respective employees, suppliers, shippers, customers, contractors and
      invitees, including parking areas, loading and unloading areas, trash areas,
      roadways, walkways, driveways and landscaped areas.
    

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

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

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

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

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

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

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

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

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

    	
          
            3.
          

        	
          
            Term.
          

        

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

    
      3.2    Early
      Possession. If Lessee totally or partially occupies
      the Premises prior to the Commencement Date, the obligation to pay Base Rent
      shall be abated for the period of such early possession. All other terms of
      this Lease (including but not limited to the obligations to pay Lessee’s
      Share of Common Area Operating Expenses, Real Property Taxes and insurance
      premiums and to maintain the Premises) shall, however, be in effect during such
      period. Any such early possession shall not affect the Expiration
      Date.
    

    
      3.3    Delay in
      Possession. Lessor agrees to use its best
      commercially reasonable efforts to deliver possession of the Premises to Lessee
      by the Commencement Date. If, despite said efforts, Lessor is unable to deliver
      possession as agreed, Lessor shall not be subject to any liability therefor,
      nor shall such failure affect the validity of this Lease. Lessee shall not,
      however, be obligated to pay Rent or perform its other obligations until it
      receives possession of the Premises. If possession is not delivered within 60
      days after the Commencement Date, Lessee may, at its option, by notice in
      writing within 10 days after the end of such 60 day period, cancel this Lease,
      in which event the Parties shall be discharged from all obligations hereunder.
      If such written notice is not received by Lessor within said 10 day period,
      Lessee’s right to cancel shall terminate. Except as otherwise provided, if
      possession is not tendered to Lessee by the Start Date and Lessee does not
      terminate this Lease, as aforesaid, any period of rent abatement that Lessee
      would otherwise have enjoyed shall run from the date of delivery of possession
      and continue for a period equal to what Lessee would otherwise have enjoyed
      under the terms hereof, but minus any days of delay caused by the acts or
      omissions of Lessee. If possession of the Premises is not delivered within 4
      months after the Commencement Date, this Lease shall terminate unless other
      agreements are reached between Lessor and Lessee, in writing.
    

    
      3.4    Lessee
      Compliance. Lessor shall not be required to tender
      possession of the Premises to Lessee until Lessee complies with its obligation
      to 
    

    
       
    

    

    
    

    
    
      provide evidence of insurance
      (Paragraph 8.5). Pending delivery of such evidence, Lessee shall be required to
      perform all of its obligations under this Lease from and after the Start Date,
      including the payment of Rent, notwithstanding Lessor’s election to
      withhold possession pending receipt of such evidence of insurance. Further, if
      Lessee is required to perform any other conditions prior to or concurrent with
      the Start Date, the Start Date shall occur but Lessor may elect to withhold
      possession until such conditions are satisfied.
    

    	
          
            4.
          

        	
          
            Rent.
          

        

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

    
      4.2   Common Area Operating Expenses. Lessee shall
      pay to Lessor during the term hereof, in addition to the Base Rent,
      Lessee’s Share (as specified in Paragraph 1.6) of all Common Area
      Operating Expenses, as hereinafter defined, during each calendar year of the
      term of this Lease, in accordance with the following provisions:
    

    
      (a)     “Common
      Area Operating Expenses” are defined, for
      purposes of this Lease, as all costs incurred by Lessor relating to the
      ownership and operation of the Project, including, but not limited to, the
      following:
    

    	
          
             
          

        	
          
            (i)
          

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

        

    
      (aa)   The Common Areas
      and Common Area improvements, including pending areas, loading and unloading
      areas, trash areas, roadways, parkways, walkways, driveways, landscaped areas,
      bumpers, irrigation systems, Common Area lighting facilities , fences and
      gates, elevators, roofs, and roof drainage systems.
    

    	
          
            (bb)
          

        	
          
            Exterior signs and any tenant
            directories.
          

        	
          
             
          

        
	
          
            (cc)
          

        	
          
            Any fire detection and/or
            sprinkler systems.
          

        

    	
          
             
          

        	
          
            (ii)
          

        	
          
            The cost of water, gas,
            electricity and telephone to service the Common Areas and any utilities not
            separately metered.
          

        

    	
          
             
          

        	
          
            (iii)
          

        	
          
            Trash disposal, pest control
            services, property management, security services, and the cost of any
            environmental inspections.
          

        

    	
          
             
          

        	
          
            (iv)
          

        	
          
            Reserves set aside for
            maintenance and repair of Common Areas.
          

        

    	
          
             
          

        	
          
            (v)
          

        	
          
            Real Property Taxes (as defined
            in Paragraph 10).
          

        

    	
          
             
          

        	
          
            (vi)
          

        	
          
            The cost of the premiums for the
            insurance maintained by Lessor pursuant to Paragraph 8. 
          

        

    	
          
             
          

        	
          
            (vii)
          

        	
          
            Any deductible portion of an
            insured loss concerning the Building or the Common Areas. 
          

        

    	
          
             
          

        	
          
            (viii)
          

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

        

    	
          
             
          

        	
          
            (ix)
          

        	
          
            Any other services to be provided
            by Lessor that are stated elsewhere in this Lease to be a Common Area Operating
            Expense.
          

        

    
      (b)     Any
      Common Area Operating Expenses and Real Property Taxes that are specifically
      attributable to the Unit, the Building or to any other building in the Project
      or to the operation, repair and maintenance thereof, shall be allocated
      entirely to such Unit, Building, or other building. However, any Common Area
      Operating Expenses and Real Property Taxes that are not specifically
      attributable to the Building or to any other building or to the operation,
      repair and maintenance thereof, shall be equitably allocated by Lessor to all
      buildings in the Project.
    

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

    
      (d)     Lessee’s Share of Common Area
      Operating Expenses shall be payable by Lessee within 10 days after a reasonably
      detailed statement of actual expenses is presented to Lessee. At Lessor’s
      option, however, an amount may be estimated by Lessor from time to time of
      Lessee’s Share of annual Common Area Operating Expenses and the same shall
      be payable monthly or quarterly, as Lessor shall designate, during each 12
      month period of the Lease term, on the same day as the Base Rent is due
      hereunder. Lessor shall deliver to Lessee within 60 days after the expiration
      of each calendar year a reasonably detailed statement showing Lessee’s
      Share of the actual Common Area Operating Expenses incurred during the
      preceding year. If Lessee’s payments under this Paragraph 4.2(d) during
      the preceding year exceed Lessee’s Share as indicated on such statement,
      Lessor shall credit the amount of such over-payment against Lessee’s Share
      of Common Area Operating Expenses next becoming due. If Lessee’s payments
      under this Paragraph 4.2(d) during the preceding year were less than
      Lessee’s Share as indicated on such statement, Lessee shall pay to Lessor
      the amount of the deficiency within 10 days after delivery by Lessor to Lessee
      of the statement.
    

    
      4.3    Payment. Lessee shall cause payment of Rent
      to be received by Lessor in lawful money of the United States, without offset
      or deduction (except as specifically permitted in this Lease), on or before the
      day on which it is due. Rent for any period during the term hereof which is for
      less than one full calendar month shall be prorated based upon the actual
      number of days of said month. Payment of Rent shall be made to Lessor at its
      address stated herein or to such other persons or place as Lessor may from time
      to time designate in writing. Acceptance of a payment which is less than the
      amount then due shall not be a waiver of Lessor’s rights to the balance of
      such Rent, regardless of Lessor’s endorsement of any check so stating. In
      the event that any check, draft, or other instrument of payment given by Lessee
      to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor the sum
      of $25 in addition to any late charges which may be due.
    

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

    	
          
            6.
          

        	
          
            Use.
          

        

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

    	
          
            6.2
          

        	
          
            Hazardous
            Substances.
          

        

    
      (a)     Reportable
      Uses Require Consent. The term “Hazardous
      Substance” as used in this Lease shall mean any product, substance, or
      waste whose presence, use, manufacture, disposal, transportation, or release,
      either by itself or in combination with other materials expected to be on the
      Premises, is either: (i) potentially injurious to the public health, safety or
      welfare, the environment or the Premises, (ii) regulated or monitored by any
      governmental authority, or (iii) a basis for potential liability of Lessor to
      any governmental agency or third party under any applicable statute or common
      law theory. Hazardous Substances shall include, but not be limited to,
      hydrocarbons, petroleum, gasoline, and/or crude oil or any products,
      by-products or fractions thereof. Lessee shall not engage in any activity in or
      on the Premises which constitutes a Reportable Use Hazardous Substances without
      the express prior written consent of Lessor and timely compliance (at
      Lessee’s expense) with all Applicable Requirements. “Reportable Use” shall mean (i)
      the installation or use of any above or below ground storage tank, (ii) the
      generation, possession, storage, use, transportation, or disposal of a
      Hazardous Substance that requires a permit from, or with respect to which a
      report, notice, registration or business plan is required to be filed with, any
      governmental authority, and/or (iii) the presence at the Premises of a
      Hazardous Substance with respect to which any Applicable Requirements requires
      that a notice be given to persons entering or occupying the Premises or
      neighboring properties. Notwithstanding the foregoing, Lessee may use any
      ordinary and customary materials reasonably required to be used in the normal
      course of the Agreed Use, so long as such use is in compliance with all
      Applicable Requirements, is not a Reportable Use, and does not expose the
      Premises or neighboring property to any meaningful risk of contamination or
      damage or expose Lessor to any liability therefore. In addition, Lessor may
      condition its consent to any Reportable Use upon receiving such additional
      assurances as Lessor reasonably deems necessary to protect itself, the public,
      the Premises and/or the environment against damage, contamination, injury
      and/or liability, including, but not limited to, the installation (and removal
      on or before Lease expiration or termination) of protective modifications (such
      as concrete encasements) and/or increasing the Security Deposit.
    

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

    

    
       
    

    

    
    

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

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

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

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

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

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

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

    	
          
            7.
          

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

        
	
          
             
          

        	
          
            7.1
          

        	
          
            Lessee’s
            Obligations.
          

        	
          
             
          

        
					

    
      (a)     In
      General. Subject to the provisions of Paragraph 2.2
      (Condition), 2.3 (Compliance), 6.3 (Lessee’s Compliance with Applicable
      Requirements), 7.2 (Lessor’s Obligations), 9 (Damage or Destruction), and
      14 (Condemnation), Lessee shall, at Lessee’s sole expense, keep the
      Premises, Utility Installations (intended for Lessee’s exclusive use, no
      matter where located), and Alterations in good order, condition and repair
      (whether or not the portion of the Premises requiring repairs, or the means of
      repairing the same, are reasonably or readily accessible to Lessee, and whether
      or not the need for such repairs occurs as a result of Lessee’s use, any
      prior use, the elements or the age of such portion of the Premises), including,
      but not limited to, all equipment or facilities, such as plumbing, HVAC
      equipment, electrical, lighting facilities, boilers, pressure vessels,
      fixtures, interior wall, interior surfaces of exterior walls, ceilings, floors,
      windows, doors, plate glass, and skylights but excluding any items which are
      the responsibility of Lessor pursuant to Paragraph 7.2. Lessee, in keeping the
      Premises in good order, condition and repair, shall exercise and perform good
      maintenance practices, specifically including the procurement and maintenance
      of the service contracts required by Paragraph 7.1(b) below. Lessee’s
      obligations shall include restorations, replacements or renewals when necessary
      to keep the Premises and all improvements thereon or a part thereof in good
      order, condition and state of repair.
    

    
      (b)     Service Contracts. Lessee shall, at Lessee's
      sole expense, procure and maintain contracts, with copies to Lessor, in
      customary form and substance for and with contractors specializing and
      experienced in the maintenance of the following equipment and improvements, if
      any, if and when installed on the Premises: (i) HVAC equipment, (ii) boiler and
      pressure vessels, (iii) clarifiers, and (iv) any other equipment, if reasonable
      required by Lessor. However, Lessor reserves the right, upon notice to Lessee,
      to procure and maintain any or all of such service contracts, and if Lessor so
      elects, Lessee shall reimburse Lessor, upon demand, for the cost
      thereof.
    

    
      (c)     Failure to
      Perform. If Lessee fails to perform Lessee’s
      obligations under this Paragraph 7.1, Lessor may enter upon the Premises after
      10 days’ prior written notice to Lessee (except in the case of an
      emergency, in which case no notice shall be required), perform such obligations
      on Lessee’s behalf, and put the Premises in good order, condition and
      repair, and Lessee shall promptly reimburse Lessor for the cost
      thereof.
    

    
      (d)      Replacement. Subject to Lessee’s
      indemnification of Lessor as set forth in Paragraph 8.7 below, and without
      relieving Lessee of liability resulting from Lessee’s failure to exercise
      and perform good maintenance practices, if an item described in Paragraph
      7.1(b) cannot be repaired other than at a cost which is in excess of 50% of the
      cost of replacing such item, then such item shall be replaced by Lessor, and
      the cost thereof shall be prorated between the Parties and Lessee shall only be
      obligated to pay, each month during the remainder of the term of this Lease, on
      the date on which Base Rent is due, an amount equal to the product of
      multiplying the cost of such replacement by a fraction, the numerator of which
      is one, and the denominator of which is 144 (i.e. 1/144th of the cost per
      month). Lessee shall pay interest on the unamortized balance at a rate that is
      commercially reasonable in the judgment of Lessor’s accountants. Lessee
      may, however, prepay its obligation at any time. 
    

    
      7.2     Lessor’s Obligations. Subject to the
      provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance), 4.2 (Common Area Operating Expenses), 6 (Use),
      7.1 (Lessee’s Obligations), 8 (Damage or Destruction) and 14
      (Condemnation), Lessor, subject to reimbursement pursuant to Paragraph
      4.2, shall keep in good
      order, condition and repair the foundations, exterior walls, structural
      condition of interior bearing walls, exterior roof, fire sprinkler system,
      Common Area fire alarm and/or smoke detection systems, fire hydrants, parking
      lots, walkways, parkways, driveways, landscaping, fences, signs and utility
      systems serving the Common Areas and all parts thereof, as well as providing
      the services for which there is a Common Area Operating Expense pursuant to
      Paragraph 4.2. Lessor shall not be obligated to paint the exterior or interior
      surfaces of exterior walls nor shall Lessor be obligated to maintain, repair or
      replace windows, doors or plate glass of the Premises. Lessee expressly waives
      the benefit of any statute now or hereafter in effect to the extent it is
      inconsistent with the terms of this Lease.
    

    	
          
            7.3
          

        	
          
            Utility Installations; Trade
            Fixtures; Alterations.
          

        

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

    
      (b)      Consent. Lessee shall not make any
      Alterations or Utility Installations to the Premises without Lessor’s
      prior written consent. Lessee may, however, make non-structural Utility
      Installations to the interior of the Premises (excluding the roof) without such
      consent but upon notice to Lessor, as long as they are not visible from the
      outside, do not involve puncturing, relocating or removing the roof or any
      existing walls, and the cumulative cost thereof during this Lease as extended
      does not exceed a sum equal to 3 month’s Base Rent in the aggregate or a
      sum equal to one month’s Base Rent in any one year. Notwithstanding the
      foregoing, Lessee shall not make or permit any roof penetrations and/or install
      anything on the roof without the prior written approval of Lessor. Lessor may,
      as a precondition to granting such approval, require Lessee to utilize a
      contractor chosen and/or approved by Lessor. Any Alterations or Utility
      Installations that Lessee shall desire to make and which require the consent of
      the Lessor shall be presented to Lessor in written form with detailed plans.
      Consent shall be deemed conditioned upon Lessee’s: (i) acquiring all
      applicable governmental permits, (ii) furnishing Lessor with copies of both the
      permits and the plans and specifications prior to commencement of the work, and
      (iii) compliance with all conditions of said permits and other Applicable
      Requirements in a prompt and expeditious manner. Any Alterations or Utility
      Installations shall be performed in a workmanlike manner with good and
      sufficient materials. Lessee shall promptly
    

    
       
    

    

    
    

    
    
      upon completion furnish Lessor with
      as-built plans and specifications. For work which costs an amount in excess of
      one month’s Base Rent, Lessor may condition its consent upon Lessee
      providing a lien and completion bond in an amount equal to 150% of the
      estimated cost of such Alteration or Utility Installation and/or upon
      Lessee’s posting an additional Security Deposit with Lessor.

    

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

    	
          
            7.4
          

        	
          
            Ownership; Removal; Surrender;
            and Restoration.
          

        

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

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

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

    	
          
            8.
          

        	
          
            Insurance;
            Indemnity.
          

        

    
      8.1     Payment of
      Premiums. The cost of the premiums for the insurance
      policies required to be carried by Lessor, pursuant to Paragraphs 8.2(b),
      8.3(a) and 8.3(b), shall be a Common Area Operating Expense. Premiums for
      policy periods commencing prior to, or extending beyond, the term of this Lease
      shall be prorated to coincide with the corresponding Start Date or Expiration
      Date.
    

    	
          
            8.2
          

        	
          
            Liability
            Insurance.
          

        

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

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

    	
          
            8.3
          

        	
          
            Property Insurance - Building,
            Improvements and Rental Value.
          

        

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

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

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

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

    	
          
            8.4
          

        	
          
            Lessee’s Property;
            Business Interruption Insurance.
          

        

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

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

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

    
      8.5     Insurance
      Policies. Insurance required herein shall be by
      companies duly licensed or admitted to transact business in the state where the
      Premises are located, and maintaining during the policy term a “General
      Policyholder Rating” of at least B+, V, as set forth in the most current
      issue of “Best’s Insurance Guide", or such other rating as may be
      required by a Lender. Lessee shall not do or permit to be done anything which
      invalidates the required insurance policies. Lessee shall, prior to the Start
      Date, deliver to Lessor certified copies of policies of such insurance or
      certificates evidencing the existence and amounts of the required insurance
      policies. No such policy shall be cancelable or subject to modification except
      after 30 days prior written notice to Lessor. Lessee shall, at least 30 days
      prior to the expiration of such policies, furnish Lessor with evidence of
      renewals or “insurance binders” evidencing renewal thereof, or Lessor
      may order such insurance and charge the cost thereof to Lessee, which amount
      shall be payable by Lessee to Lessor upon demand. Such policies shall be for a
      term of at least one year, or the length of the remaining term of this Lease,
      whichever is less. If either Party shall fail to procure and maintain the
      insurance required to be carried by it, the other Party may, but shall not be
      required to, procure and maintain the same.
    

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

    
      8.7     Indemnity. Except for Lessor’s gross
      negligence or willful misconduct, Lessee shall indemnify, protect, defend and
      hold harmless the Premises, Lessor and its agents, Lessor’s master or
      ground lessor, partners and Lenders, from and against any and all claims, loss
      of rents and/or damages, liens, judgments, penalties, attorneys’ and
      consultants’ fees, expenses and/or liabilities arising out of, involving,
      or in connection with, the use and/or occupancy of the Premises by Lessee. If
      any action or proceeding is brought against Lessor by reason of any of the
      foregoing matters, Lessee shall upon notice defend the same at Lessee’s
      expense by counsel reasonably satisfactory to Lessor and Lessor shall cooperate
      with Lessee in such defense. Lessor need not have first paid any such claim in
      order to be defended or indemnified.
    

    
      8.8    Exemption of
      Lessor from Liability. Lessor shall not be liable for
      injury or damage to the person or goods, wares, merchandise or other property
      of Lessee, Lessee’s employees, contractors, invitees, customers, or any
      other person in or about the Premises, whether such damage or injury is caused
      by or results from fire, steam, electricity, gas, water or rain, or from the
      breakage, leakage, obstruction or other defects of pipes, fire sprinklers,
      wires, appliances,
    

    
       
    

    

    
    

    
    
      plumbing, HVAC or lighting fixtures, or
      from any other cause, whether the said injury or damage results from conditions
      arising upon the Premises or upon other portions of the Building, or from other
      sources or places. Lessor shall not be liable for any damages arising from any
      act or neglect of any other tenant of Lessor nor from the failure of Lessor to
      enforce the provisions of any other lease in the Project. Notwithstanding
      Lessor’s negligence or breach of this Lease, Lessor shall under no
      circumstances be liable for injury to Lessee’s business or for any loss of
      income or profit therefrom.
    

    	
          
            9.
          

        	
          
            Damage or
            Destruction.
          

        

    	
          
            9.1
          

        	
          
            Definitions.

          

        

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

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

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

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

    
      (e)     “Hazardous Substance Condition”
      shall mean the occurrence or discovery of a condition involving the presence
      of, or a contamination by, a Hazardous Substance as defined in Paragraph
      6.2(a), in, on, or under the Premises.
    

    
      9.2     Partial
      Damage - Insured Loss. If a Premises Partial Damage
      that is an insured Loss occurs, than Lessor shall, at Lessor’s expense,
      repair such damage (but not Lessee’s Trade Fixtures or Lessee Owned
      Alterations and Utility installations) as soon as reasonably possible and this
      Lease shall continue in full force and effect; provided, however, that Lessee
      shall, at Lessor’s election, make the repair of any damage or destruction
      the total cost to repair of which is $5,000 or less, and, in such event, Lessor
      shall make any applicable insurance proceeds available to Lessee on a
      reasonable basis for that purpose. Notwithstanding the foregoing, if the
      required insurance was not in force or the insurance proceeds are not
      sufficient to effect such repair, the Insuring Party shall promptly contribute
      the shortage in proceeds as and when required to complete said repairs. In the
      event, however, such shortage was due to the fact that, by reason of the unique
      nature of the improvements, full replacement cost insurance coverage was not
      commercially reasonable and available, Lessor shall have no obligation to pay
      for the shortage in insurance proceeds or to fully restore the unique aspects
      of the Premises unless Lessee provides Lessor with the funds to cover same, or
      adequate assurance therefore, within 10 days following receipt of written
      notice of such shortage and request therefore. If Lessor receives said funds or
      adequate assurance thereof within said 10 day period, the party responsible for
      making the repairs shall complete them as soon as reasonably possible and this
      Lease shall remain in full force and effect. If such funds or assurance are not
      received, Lessor may nevertheless elect by written notice to Lessee within 10
      days thereafter to: (i) make such restoration and repair as is commercially
      reasonable with Lessor paying any shortage in proceeds, in which case this
      Lease shall remain in full force and effect, or (ii) have this Lease terminate
      30 days thereafter. Lessee shall not be entitled to reimbursement of any funds
      contributed by Lessee to repair any such damage or destruction. Premises
      Partial Damage due to flood or earthquake shall be subject to Paragraph 9.3,
      notwithstanding that there may be some insurance coverage, but the net proceeds
      of any such insurance shall made available for the repairs if made by either
      Party.
    

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

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

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

    	
          
            9.6
          

        	
          
            Abatement of Rent;
            Lessee’s Remedies.
          

        

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

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

    
      9.7    Termination;
      Advance Payments. Upon termination of this Lease
      pursuant to Paragraph 6.2(g) or Paragraph 9, an equitable adjustment shall be
      made concerning advance Base Rent and any other advance payments made by Lessee
      to Lessor. Lessor shall, in addition, return to Lessee so much of Lessee’s
      Security Deposit as has not been, or is not then required to be, used by
      Lessor.
    

    
      9.8     Waive
      Statutes. Lessor and Lessee agree that the terms of
      this Lease shall govern the effect of any damage to or destruction of the
      Premises with respect to the termination of this Lease and hereby waive the
      provisions of any present or future statute to the extent inconsistent
      herewith.
    

    	
          
            10.
          

        	
          
            Real Property
            Taxes.
          

        

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

    
      10.2   Payment of Taxes. Lessor shall pay the Real
      Property Taxes applicable to the Project, and except as otherwise provided in
      Paragraph 10.3, any such amounts shall be included in the calculation of Common
      Area Operating Expenses in accordance with the provisions of Paragraph
      4.2.
    

    
      10.3   Additional Improvements. Common Area
      Operating Expenses shall not include Real Property Taxes specified in the tax
      assessor’s records and work sheets as being caused by additional
      improvements placed upon the Project by other Lessees or by Lessor for the
      exclusive enjoyment of such other lessees. Notwithstanding Paragraph 10.2
      hereof, Lessee shall, however, pay to Lessor at the time Common Area Operating
      Expenses are payable under Paragraph 4.2, the entirety of any increase in Real
      Property Taxes if assessed solely by reason of Alterations, Trade Fixtures or
      Utility Installations placed upon the Premises by Lessee or at Lessee’s
      request.
    

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

    

    
    

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

    
      11.    Utilities.
      Lessee shall pay for all water, gas, heat, light, power, telephone, trash
      disposal and other utilities and services supplied to the Premises, together
      with any taxes thereon. Notwithstanding the provisions of Paragraph 4.2, If at
      any time in Lessor’s sole judgment, Lessor determines that Lessee is using
      a disproportionate amount of water, electricity or other commonly metered
      utilities, or that Lessee is generating such a large volume of trash as to
      require an increase in the size of the dumpster and/or an increase in the
      number of times per month that the dumpster is emptied, then Lessor may
      increase Lessee’s Base Rent by an amount equal to such increased costs.
      
    

    	
          
            12.
          

        	
          
            Assignment and
            Subletting.
          

        	
          
             
          

        
	
          
             
          

        	
          
            12.1
          

        	
          
            Lessors Consent
            Required.
          

        
					

    
      (a)     Lessee
      shall not voluntarily or by operation of law assign, transfer, mortgage or
      encumber (collectively, “assign or
      assignment”) or sublet all or any part of
      Lessee’s interest in this Lease or in the Premises without Lessor’s
      prior written consent.
    

    
      (b)     A
      change in the control of Lessee shall constitute an assignment requiring
      consent. The transfer, on a cumulative basis, of 25% or more of the voting
      control of Lessee shall constitute a change in control for this
      purpose.
    

    
      (c)     The
      involvement of Lessee or its assets in any transaction, or series of
      transactions (by way of merger, sale, acquisition, financing, transfer,
      leveraged buy-out or otherwise), whether or not a formal assignment or
      hypothecation of this Lease or Lessee’s assets occurs, which results or
      will result in a reduction of the Net Worth of Lessee by an amount greater than
      25% of such Net Worth as it was represented at the time of the execution of
      this Lease or at the time of the most recent assignment to which Lessor has
      consented, or as it exists immediately prior to said transaction or
      transactions constituting such reduction, whichever was or is greater, shall be
      considered an assignment of this Lease to which Lessor may withhold its
      consent. “Net Worth of
      Lessee” shall mean the net worth of Lessee
      (excluding any guarantors) established under generally accepted accounting
      principles.
    

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

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

    	
          
            12.2
          

        	
          
            Terms and Conditions
            Applicable to Assignment and Subletting.
          

        

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

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

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

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

    
      (e)     Each
      request for consent to an assignment or subletting shall be in writing,
      accompanied by information relevant to Lessor’s determination as to the
      financial and operational responsibility and appropriateness of the proposed
      assignee or sublessee, including but not limited to the intended use and/or
      required modification of the Premises, if any, together with a fee of $1,000 or
      10% of the current monthly Base Rent applicable to the portion of the Premises
      which is the subject of the proposed assignment or sublease, whichever is
      greater, as consideration for Lessor’s considering and processing said
      request. Lessee agrees to provide Lessor with such other or additional
      information and/or documentation as may be reasonably requested.
    

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

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

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

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

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

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

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

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

    	
          
            13.
          

        	
          
            Default; Breach;
            Remedies.
          

        

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

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

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

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

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

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

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

    
      (g)     If the
      performance of Lessee’s obligations under this Lease is guaranteed: (i)
      the death of a Guarantor, (ii) the termination of a Guarantor’s liability
      with respect to this Lease other than in accordance with the terms of such
      guaranty, (iii) a Guarantor’s becoming insolvent or the subject of a
      bankruptcy filing, (iv) a Guarantor’s refusal to honor the guaranty, or
      (v) a Guarantor’s breach of its guaranty obligation on an anticipatory
      basis, and Lessee’s failure, 
    

    
       
    

    

    
    

    
    
      within 60 days following written notice
      of any such event, to provide written alternative assurance or security, which,
      when coupled with the then existing resources of Lessee, equals or exceeds the
      combined financial resources of Lessee and the Guarantors that existed at the
      time of execution of this Lease.
    

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

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

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

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

    
      13.3   Inducement Recapture. Any agreement for free
      or abated rent or other charges, or for the giving or paying by Lessor to or
      for Lessee of any cash or other bonus, inducement or consideration for
      Lessee’s entering into this Lease, all of which concessions are
      hereinafter referred to as “Inducement
      Provisions”, shall be deemed conditioned upon
      Lessee’s full and faithful performance of all of the terms, covenants and
      conditions of this Lease. Upon Breach of this Lease by Lessee, any such
      Inducement Provision shall automatically be deemed deleted from this Lease and
      of no further force or effect, and any rent, other charge, bonus, inducement or
      consideration therefore abated, given or paid by Lessor under such an
      Inducement Provision shall be immediately due and payable by Lessee to Lessor,
      notwithstanding any subsequent cure of said Breach by Lessee. The acceptance by
      Lessor of rent or the cure of the Breach which initiated the operation of this
      paragraph shall not be deemed a waiver by Lessor of the provisions of this
      paragraph unless specifically so stated in writing by Lessor at the time of
      such acceptance.
    

    
       13.4   Late
      Charges. Lessee hereby acknowledges that late payment
      by Lessee of Rent will cause Lessor to incur costs not contemplated by this
      Lease, the exact amount of which will be extremely difficult to ascertain. Such
      costs include, but are not limited to, processing and accounting charges, and
      late charges which may be imposed upon Lessor by any Lender. Accordingly, if
      any Rent shall not be received by Lessor within 5 days after such amount shall
      be due, then, without any requirement for notice to Lessee, Lessee shall pay to
      Lessor a one-time late charge equal to 10% of each such overdue amount or $100,
      whichever is greater. The parties hereby agree that such late charge represents
      a fair and reasonable estimate of the costs Lessor will incur by reason of such
      late payment. Acceptance of such late charge by Lessor shall in no event
      constitute a waiver of Lessee’s Default or Breach with respect to such
      overdue amount, nor prevent the exercise of any of the other rights and
      remedies granted hereunder. In the event that a late charge is payable
      hereunder, whether or not collected, for 3 consecutive installments of Base
      Rent, then notwithstanding any provision of this Lease to the contrary, Base
      Rent shall, at Lessor’s option, become due and payable quarterly in
      advance. 
    

    
      13.5   Interest. Any monetary payment due Lessor
      hereunder, other than late charges, not received by Lessor, when due as to
      scheduled payments (such as Base Rent) or within 30 days following the date on
      which it was due for non-scheduled payment, shall bear interest from the date
      when due, as to scheduled payments, or the 31st day after it was due as to
      non-scheduled payments. The interest (“Interest”;)
      charges shall be equal to the prime rate reported in the Wall Street Journal as
      published closest prior to the date when due plus 4%, but shall not exceed the
      maximum rate allowed by law. Interest is payable in addition to the potential
      late charge provided for in Paragraph 13.4.
    

    	
          
            13.6
          

        	
          
            Breach by
            Lessor.
          

        

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

    
      (b)     Performance
      by Lessee on Behalf of Lessor. In the event that
      neither Lessor nor Lender cures said breach within 30 days after receipt of
      said notice, or if having commenced said cure they do not diligently pursue it
      to completion, then Lessee may elect to cure said breach at Lessee’s
      expense and offset from Rent an amount equal to the greater of one month’s
      Base Rent or the Security Deposit, and to pay an excess of such expense under
      protest, reserving Lessee’s right to reimbursement from Lessor. Lessee
      shall document the cost of said cure and supply said documentation to
      Lessor.
    

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

    	
          
            15.
          

        	
          
            Brokerage
            Fees.
          

        

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

    
      15.2   Assumption of Obligations. Any buyer or
      transferee of Lessor’s interest in this Lease shall be deemed to have
      assumed Lessor’s obligation hereunder. Brokers shall be third party
      beneficiaries of the provisions of Paragraphs 1.10, 15, 22 and 31. If Lessor
      fails to pay to Brokers any amounts due as and for brokerage fees pertaining to
      this Lease when due, then such amounts shall accrue interest. In addition, if
      Lessor fails to pay any amounts to Lessee’s Broker when due, Lessee’s
      Broker may send written notice to Lessor and Lessee of such failure and if
      Lessor fails to pay such amounts within 10 days after said notice, Lessee shall
      pay said monies to its Broker and offset such amounts against Rent. In
      addition, Lessee’s Broker shall be deemed to be a third party beneficiary
      of any commission agreement entered into by and/or between Lessor and
      Lessor’s Broker for the limited purpose of collecting any brokerage fee
      owed.
    

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

    	
          
            16.
          

        	
          
            Estoppel
            Certificates.
          

        

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

    
       
    

    

    
    

    
    
      Party.
    

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

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

    
      17.    Definition of
      Lessor. The term “Lessor” as used herein shall mean the
      owner or owners at the time in question of the fee title to the Premises, or,
      if this is a sublease, of the Lessee’s interest in the prior lease. In the
      event of a transfer of Lessor’s titled or interest in the Premises or this
      Lease, Lessor, shall deliver to the transferee or assignee (in cash or by
      credit) any unused Security Deposit held by Lessor. Except as provided in
      Paragraph 15, upon such transfer or assignment and delivery of the Security
      Deposit, as aforesaid, the prior Lessor shall be relieved of all liability with
      respect to the obligations and/or covenants under this Lease thereafter to be
      performed by the Lessor. Subject to the foregoing, the obligations and/or
      covenants in this Lease to be performed by the Lessor shall be binding only
      upon the Lessor as herein above defined. Not withstanding the above, and
      subject to the provisions of Paragraph 20 below, the original Lessor under this
      Lease, and all subsequent holders of the Lessor’s interest in this Lease
      shall remain liable and responsible with regard to the potential duties and
      liabilities of Lessor pertaining to Hazardous Substances as outline in
      paragraph 6.2 above.
    

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

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

    
      20.     Limitation
      on Liability. Subject to the provisions of Paragraph
      17 above, the obligations of Lessor under this Lease shall not constitute
      personal obligations of Lessor, the individual partners of Lessor or its or
      their individual partners, directors, officers or shareholders, and Lessee,
      shall look to the Premises, and to no other assets of Lessor, for the
      satisfaction of any liability of Lessor with respect to this Lease, and shall
      not seek recourse against the individual partners of Lessor, or its or their
      individual partners, directors, officers or shareholders, or any of their
      personal assets for such satisfaction.
    

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

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

    	
          
            23.
          

        	
          
            Notices.
          

        

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

    
      23.2   Date of Notice. Any notice sent by
      registered or certified mail, return receipt requested, shall to deemed given
      on date of delivery shown on the receipt card, or if no delivery date is show,
      the postmark thereon. If send by regular mail the notice shall be deemed given
      48 hours after the same is addressed as required herein and mailed with postage
      prepaid. Notices delivered by United States Express Mail or overnight courier
      that guarantee next day delivery shall be deemed given 24 hours after delivery
      of the same to the Postal Services or courier. Notices transmitted by facsimile
      transmission or similar means shall be deemed delivered upon telephone
      confirmation of receipt (confirmation reports from fax machine is sufficient),
      provided a copy is also delivered via delivery or mail. If notice is received
      on a Saturday, Sunday or legal holiday, it shall be deemed received on the next
      business day.
    

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

    	
          
            25.
          

        	
          
            Disclosure Regarding The
            Nature of a Real Estate Agency Relationship.
          

        

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

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

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

    
      (iii)     Agent
      Representing Both Lessor and Lessee. A real estate
      agent, either acting directly or through one or more associates license, can
      legally be the agent of both the Lessor and Lessee in a transaction, but only
      with the knowledge and consent of both the Lessor and Lessee. In a dual agency
      situation, the agent has the following affirmative obligations to both the
      Lessor and the Lessee: (a) A fiduciary duty of utmost care, integrity, honesty
      and loyalty in the dealings with either Lessor or the Lessee. (b) Other duties
      to the Lessor and the Lessee as stated above in subparagraphs (i) or (ii). In
      representing both Lessor and Lessee, the agent may not without the express
      permission of the respective Party, disclose to the other Party that the Lessor
      will accept rent in an amount less than that indicated in the listing or that
      the Lessee is willing to pay a higher rent than that offered. The above duties
      of the agent in a real estate transaction do not relieve a Lessor or Lessee
      from the responsibility to protect their own Interests. Lessor and Lessee
      should carefully read all agreements to assure that they adequately express
      their understanding of the transaction. A real estate agent is a person
      qualified to advise about real estate. If legal or tax advice is desired,
      consult a competent professional.
    

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

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

    
      26.    No Right To
      Holdover. Lessee has no right to retain possession of
      the Premises or any part thereof beyond the expiration or termination of this
      Lease. In the event that Lessee holds over, then the Base Rent shall be
      increased to 150% of the Base Rent applicable immediately preceding the
      expiration or termination. Nothing contained herein shall be construed as
      consent by Lessor to any holding over by Lessee.
    

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

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

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

    	
          
            30.
          

        	
          
            Subordination; Attornment;
            Non-Disturbance.
          

        

    
       
    

    

    
    

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

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

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

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

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

    
      32.    Lessor’s
      Access; Showing Premises; Repairs. Lessor and
      Lessor’s agents shall have the right to enter the Premises at any time, in
      the case of an emergency, and otherwise at reasonable times for the purpose of
      showing the same to prospective purchasers, lenders, or tenants, and making
      such alterations, repairs, improvements or additions to the Premises as Lessor
      may deem necessary. All such activities shall be without abatement of rent or
      liability to Lessee. Lessor may at any time place on the Premises any ordinary
      “For Sale” signs and Lessor may during the last 6 months of the term
      hereof place on the Premises any ordinary “ For Lease” signs. Lessee
      may at any time place on the Premises any ordinary “For Sublease”
      sign. 
    

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

    
      34.     Signs. Except for ordinary “For
      Sublease” signs which may be placed only on the Premises, Lessee shall not
      place any sign upon the Project without Lessor’s prior written consent.
      All signs must comply with all Applicable Requirements.
    

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

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

    	
          
            37.
          

        	
          
            Guarantor.
          

        

    
      37.1   Execution. The Guarantors, if any, shall
      each execute a guaranty in the form most recently published by the American
      Industrial Real Estate Association, and each such Guarantor shall have the same
      obligations as Lessee under this Lease.
    

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

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

    	
          
            39.
          

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

        

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

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

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

    	
          
            39.4
          

        	
          
            Effect of Default on
            Options.
          

        

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

    

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

    
      (c)      An Option shall terminate and
      be of no further force or effect, notwithstanding Lessee’s due and timely
      exercise of the Option, If, after such exercise and prior to the commencement
      of the extended term, (i) Lessee fails to pay Rent for a period of 30 days
      after such Rent becomes due (without any necessity of Lessor to give notice
      thereof), (ii) Lessor gives to Lessee 3 or more notices of separate Default
      during any 12 month period, whether or not the Defaults are cured, or (iii) If
      Lessee commits a Breach of this Lease.
    

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

    
      41.    Reservations. Lessor reserves the right: (i)
      to grant, without the consent or joinder of Lessee, such easements, rights and
      dedications that Lessor deems necessary, (ii) to cause the recordation of
      parcel maps and restrictions, and (iii) to create and/or install new utility
      raceways, so long as such easements, rights, dedications, maps, restrictions,
      and utility raceways do not unreasonably interfere with the use of the Premises
      by Lessee. Lessee agrees to sign any documents reasonably requested by Lessor
      to effectuate such rights. 
    

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

    
       
    

    

    
    

    
    
      was not legally required to
      pay.
    

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

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

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

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

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

    
      48.     Waiver of
      Jury Trial. The Parties hereby waive their respective
      rights to trial by jury in any action or proceeding involving the Property or
      arising out of this Agreement.
    

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

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

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

    	
          
            1.
          

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

        

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

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

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

    
       
    

    
      	
            
              Executed at: Los
              Angelos
            

          	
            
               
            

          	
            
               
            

          	
            
              Executed at: Los
              Angelos
            

          
	
            
              on: 8/23/04
            

          	
            
               
            

          	
            
               
            

          	
            
              on: 8/23/04
            

          
	
            
              By LESSOR:
              
 
            

          	
            
               
            

          	
            
               
            

          	
            
              By LESSEE:
              
 
            

          
	
            
              [illegible]________________________
            

          	
            
               
            

          	
            
               
            

          	
            
              [illegible]___________
            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
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              Telephone: (___)
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
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              Facsimile: (___)
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
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              Federal ID No.
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              Federal ID No.
            

          	
            
               
            

          
																				

 

    
       
    

    
      These forms are often modified to
      meet changing requirements of law and needs of the industry. Always write or
      call to make sure you are utilizing the most current form: American Industrial
      Real Estate Association, 700 South Flower Street, Suite 600, Los Angeles, CA
      90017. (213) 687-8777.
    

    
      ©Copyright 1999 By American
      Industrial Real Estate Association.
    

    
      All rights reserved.
      
    

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

    
      * Exhibits Attached
    

    
       
    

    

    
    

    
    
      LEASE EXHIBITS
    

    
      (9916 So. Santa Monica Blvd.)
    

    
      1. Base Rent shall be escalated as follows (includes any
      and all contributions for taxes and insurances):
    

    
      $ 12,000 for year 1
    

    
      $ 12,750 for year 2
    

    
      $ 13,500 for year 3
    

    
      2. TAG agrees that offices designated in the diagram
      attached for Andrew Stevens, Shahrook Oomer, post production supervisor, Alison
      Semenza, and Dave Ralph or their replacements be allocated to them for the term
      of the lease at no cost.
    

    
      3. Parking: There will be ten (10) parking spaces in year one (1) allocated to
      the TAG/Stevens personnel with the most senior persons receiving the available
      slots. Little SM Holding, LLC, will make best efforts to obtain valet parking
      for the additional personnel and guests via next door in the Amato parking
      lot.
    

    
      4. TAG will cover their own phone, FED-EX, prorated
      utilities for the ground floor, copier and installation of equipment at their
      own expense.
    

    
      5. TAG and Andrew Stevens Entertainment agree to split
      50/50 common area operating expenses defined as follows: monthly alarm
      & security monitoring,
      cleaning, coffee and kitchen supplies and Arrowhead Water.
    

    
      6. Little SM Holding, LLC., prior to October 1, 2004, will
      paint the offices that TAG personnel will occupy in the current neutral color
      unless otherwise instructed by TAG.
    

    
      7. Little SM Holding, LLC. will modify the existing
      executive office that will be occupied by Steve Austin to construct a window
      (at seated eye level) between the adjacent offices on both sides.
    

    
      8. Little SM Holding, LLC will pay for the demolition of
      the existing work stations and walls in the Steve Austin/Nzinga Garvey space as
      indicated on the revised floor plan attached dated as of 9/9/04 as well as
      paying for the construction for bifurcation and addition of a door on the
      Alison Semenza/Dave Ralph office space.
    

    
      AGREED TO AND ACCEPTED BY:
    

    
       
    

    
      	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          
	
            
              

            

          	
            
               
            

          	
            
               
            

          	
            
              

            

          
	
            
              TAG Entertainment
            

          	
            
               
            

          	
            
               
            

          	
            
              Little SM Holding, LLC
            

          
	
            
              Its:[illegible] ____/CEO
            

          	
            
               
            

          	
            
               
            

          	
            
              Its:[illegible] _________
            

          

 

    
       
    

    

    
    

    
    
      NzingA Does work for you?
    

    
      9916 S. Santa Monica Blvd. 1st FloorExhibit 10.7
    

    
      

    

    
      AIR COMMERCIAL REAL ESTATE
      ASSOCIATION 
    

    
      STANDARD
      INDUSTRIAL/COMMERCIAL
    

    
      MULTI-TENANT LEASE -
      GROSS
    

    	
          
            1.
          

        	
          
            Basic Provisions
            (“Basic
            Provisions”).
          

        

    
      1.1    Parties: This Lease (“Lease”), dated for reference
      purposes only November 9, 2004, is made by and between THE SCHOFIELD FAMILY
      TRUST (“Lessor”)
      and TAG ENTERTAINMENT, INC., A CALIFORNIA CORPORATION (“Lessee”), (collectively the
      “Parties”, or
      individually a “Party”).
    

    
      1.2(a)  Premises: That certain portion of the
      Project (as defined below), including all improvements therein or to be
      provided by Lessor under the terms of this Lease, commonly known by the street
      address of 9615 Canoga Ave., Chatsworth, located in the City of Los Angeles,
      County of Los Angeles, State of California, with zip code 91311, as outlined on
      Exhibit ______ attached hereto (“Premises”) and generally described as
      (describe briefly the nature of the Premises): approximately 10,392
      sq.ft. industrial
      condominium.
    

    
      In addition to Lessee’s rights to
      use and occupy the Premises as hereinafter specified, Lessee shall have
      non-exclusive rights to any utility raceways of the building containing the
      Premises (“Building”) and to the Common
      Areas (as defined in Paragraph 2.7 below), but shall not have any rights to the
      roof, or exterior walls of the Building or to any other buildings in the
      Project. The Premises, the Building, the Common Areas, the land upon which they
      are located, along with all other buildings and improvements thereon, are
      herein collectively referred to as the “Project.” (See also Paragraph
      2)
    

    
      1.2(b) Parking: twenty-two (22) unreserved vehicle
      parking spaces. (See also Paragraph 2.6)
    

    
      1.3    Term: 3 years and 0 months (“Original Term”) commencing
      December 1, 2004 (“Commencement
      Date”) and ending November 30, 2007
      (“Expiration Date”). (See also Paragraph 3)
    

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

    
      1.5    Base
      Rent: $8,000.00 per month (“Base Rent”), payable on the 1st
      day of each month commencing December 1, 2004. (See also Paragraph 4)
      
    

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

    
      1.6    Lessee’s
      Share of Common Area Operating Expenses: sixteen and
      10/100ths percent (16.10%) (“Lessee’s
      Share”). 
    

    
      Lessee’s Share has been calculated
      by dividing the approximate square footage of the Premises by the approximate
      square footage of the Project. In the event that size of the Premises and/or
      the Project are modified during the term of this Lease, Lessor shall
      recalculate Lessee’s Share to reflect such modification.
    

    
      1.7    Base Rent and
      Other Monies Paid Upon Execution:
    

    	
          
             
          

        	
          
            (a)
          

        	
          
            Base Rent: $8,000.00 for the period December
            1-31, 2004.
          

        

    	
          
             
          

        	
          
            (b)
          

        	
          
            Common Area Operating
            Expenses: $ __________ for the period
            __________.
          

        

    	
          
             
          

        	
          
            (c)
          

        	
          
            Security
            Deposit: $8,000.00 (“Security Deposit”). (See also
            Paragraph 5)
          

        

    	
          
             
          

        	
          
            (d)
          

        	
          
            Other: $______________ for __________________________.
          

        

    	
          
             
          

        	
          
            (e)
          

        	
          
            Total Due Upon Execution of
            this Lease: $16,000.00
          

        

    
      1.8    Agreed
      Use: Office, storage, film production and all related
      legal uses as permitted in the MR-2 zone of the City of Los Angeles and as
      permitted by the CC&R’s governing the building and for no other
      purposes. (See also Paragraph 6)
    

    
      1.9    Insuring
      Party. Lessor is the “Insuring Party”. (See also Paragraph
      8)
    

    
      1.10   Real Estate Brokers: (See also Paragraph
      15)
    

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

    	
          
            R
          

        	
          
            DELPHI BUSINESS PROPERTIES, INC.
            represents Lessor exclusively (“Lessor’s
            Broker”); 
          

        

    	
          
            R
          

        	
          
            INDUSTRIAL PARK ASSOCIATES
            represents Lessee exclusively (“Lessee’s
            Broker”); or 
          

        

    	
          
            o
          

        	
          
            ____________________________
            represents both Lessor and Lessee (“Dual
            Agency”).
          

        

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

    
      1.11    Guarantor. The obligations of the Lessee
      under this Lease are to be guaranteed by Steve Austin (“Guarantor”). (See also Paragraph
      37)
    

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

    	
          
            R
          

        	
          
            an Addendum consisting of
            Paragraphs 50 through 68;
          

        

    	
          
            o
          

        	
          
            a site plan depicting the
            Premises;
          

        

    	
          
            o
          

        	
          
            a site plan depicting the
            Project;
          

        

    	
          
            o
          

        	
          
            a current set of the Rules and
            Regulations for the Project;
          

        

    
       
    

    	
          
            

            
          

        	
          
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            INITIALS
          

        	
          
             
          

        	
          
            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    

    
    

    
    
       
    

    
       
    

    	
          
            o a
            current set of the Rules and Regulations adopted by the owners’
            association;
          

        
	
          
            o a
            Work Letter;
          

        
	
          
            o
            other (specify):
          

        	
          
             
          

        
	
          
             
          

        
	
          
             
          

        

 

    	
          
            2.
          

        	
          
            Premises.
          

        

    
      2.1    Letting.
      Lessor hereby leases to Lessee, and Lessee hereby
      leases from Lessor, the Premises, for the term, at the rental, and upon all of
      the terms, covenants and conditions set forth in this Lease. Unless otherwise
      provided herein, any statement of size set forth in this Lease, or that may
      have been used in calculating Rent, is an approximation which the Parties agree
      is reasonable and any payments based thereon are not subject to revision
      whether or not the actual size is more or less. NOTE:
      Lessee is advised to verify the actual size prior to executing this
      Lease.
    

    
      2.2    Condition. Lessor shall deliver that portion
      of the Premises contained within the Building (“Unit”) to Lessee broom clean and
      free of debris on the Commencement Date or the Early Possession Date, whichever
      first occurs (“Start Date”), and, so long as the required service contracts described in
      Paragraph 7.1(b) below are obtained by Lessee and in effect within thirty days
      following the Start Date, warrants that the existing electrical, plumbing, fire
      sprinkler, lighting, heating, ventilating and air conditioning systems
      (“HVAC”), loading
      doors, sump pumps, if any, and all other such elements in the Unit, other than
      those constructed by Lessee, shall be in good operating condition on said date,
      that the structural elements of the roof, bearing walls and foundation of the
      Unit shall be free of material defects, and that the Unit does not contain
      hazardous levels of any mold or fungi defined as toxic under applicable state
      or federal law. If a non-compliance with such warranty exists as of the Start
      Date, or if one of such systems or elements should malfunction or fail within
      the appropriate warranty period. Lessor shall, as Lessor’s sole obligation
      with respect to such matter, except as otherwise provided in this Lease,
      promptly after receipt of written notice from Lessee setting forth with
      specificity the nature and extent of such non-compliance, malfunction or
      failure, rectify same at Lessor’s expense. The warranty periods shall be
      as follows: (i) 6 months as to the HVAC systems, and (ii) 30 days as to the
      remaining systems and other elements of the Unit. If Lessee does not give
      Lessor the required notice within the appropriate warranty period, correction
      of any such non-compliance, malfunction or failure shall be the obligation of
      Lessee at Lessee’s sole cost and expense (except for the repairs to the
      fire sprinkler systems, roof, foundations, and/or bearing walls - see Paragraph
      7).
    

    
      2.3    Compliance. Lessor warrants that to the best
      of its knowledge the improvements on the Premises and the Common Areas comply
      with the building codes that were in effect at the-time that each such
      improvement, or portion thereof, was constructed, and also with all applicable
      laws, covenants or restrictions of record, regulations, and ordinances in
      effect on the Start Date (“Applicable
      Requirements”). Said warranty does not apply to
      the use to which Lessee will put the Premises, modifications which may be
      required by the Americans with Disabilities Act or any similar laws as a result
      of Lessee’s use (see Paragraph 49), or to any Alterations or Utility
      Installations (as defined in Paragraph 7.3(a)) made or to be made by Lessee.
      NOTE: Lessee is responsible for determining whether or
      not the Applicable Requirements, and especially the zoning are appropriate for
      Lessee’s intended use, and acknowledges that past uses of the Premises may
      no longer be allowed. If the Premises do not comply
      with said warranty, Lessor shall, except as otherwise provided, promptly after
      receipt of written notice from Lessee setting forth with specificity the nature
      and extent of such non-compliance, rectify the same at Lessor’s expense.
      If Lessee does not give Lessor written notice of a non-compliance with this
      warranty within 6 months following the Start Date, correction of that
      non-compliance shall be the obligation of Lessee at Lessee’s sole cost and
      expense. If the Applicable Requirements are hereafter changed so as to require
      during the term of this Lease the construction of an addition to or an
      alteration of the Unit, Premises and/or Building, the remediation of any
      Hazardous Substance, or the reinforcement or other physical modification of the
      Unit, Premises and/or Building (“Capital
      Expenditure”), Lessor and Lessee shall allocate
      the cost of such work as follows:
    

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

    
      (b) If such Capital Expenditure is not
      the result of the specific and unique use of the Premises by Lessee (such as,
      governmentally mandated seismic modifications), then Lessor and Lessee shall
      allocate the obligation to pay for the portion of such costs reasonably
      attributable to the Premises pursuant to the formula set out in Paragraph
      7.1(d); provided, however, that if such Capital Expenditure is required during
      the last 2 years of this Lease or if Lessor reasonably determines that it is
      not economically feasible to pay its share thereof, Lessor shall have the
      option to terminate this Lease upon 90 days prior written notice to Lessee
      unless Lessee notifies Lessor, in writing, within 10 days after receipt of
      Lessor’s termination notice that Lessee will pay for such Capital
      Expenditure. If Lessor does not elect to terminate, and fails to tender its
      share of any such Capital Expenditure, Lessee may advance such funds and deduct
      same, with Interest, from Rent until Lessor’s share of such costs have
      been fully paid. If Lessee is unable to finance Lessor’s share, or if the
      balance of the Rent due and payable for the remainder of this Lease is not
      sufficient to fully reimburse Lessee on an offset basis, Lessee shall have the
      right to terminate this Lease upon 30 days written notice to
      Lessor.
    

    
      (c) Notwithstanding the above, the
      provisions concerning Capital Expenditures are intended to apply only to
      non-voluntary, unexpected, and new Applicable Requirements. If the Capital
      Expenditures are instead triggered by Lessee as a result of an actual or
      proposed change in use, change in intensity of use, or modification to the
      Premises then, and in that event, Lessee shall either: (i) immediately cease
      such changed use or intensity of use and/or take such other steps as may be
      necessary to eliminate the requirement for such Capital Expenditure, or (ii)
      complete such Capital Expenditure at its own expense. Lessee shall not have any
      right to terminate this Lease.
    

    
      2.4    Acknowledgements. Lessee acknowledges that:
      (a) it has been advised by Lessor and/or Brokers to satisfy itself with respect
      to the condition of the Premises (including but not limited to the electrical,
      HVAC and fire sprinkler systems, security, environmental aspects, and
      compliance with Applicable Requirements and the Americans with Disabilities
      Act), and their suitability for Lessee’s intended use, (b) Lessee has made
      such investigation as it deems necessary with reference to such matters and
      assumes all responsibility therefor as the same relate to its occupancy of the
      Premises, and (c) neither Lessor, Lessor’s agents, nor Brokers have made
      any oral or written representations or warranties with respect to said matters
      other than as set forth in this Lease. In addition, Lessor acknowledges that:
      (i) Brokers have made no representations, promises or warranties concerning
      Lessee’s ability to honor the Lease or suitability to occupy the Premises,
      and (ii) it is Lessor’s sole responsibility to investigate the financial
      capability and/or suitability of all proposed tenants.
    

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

    
      2.6     Vehicle
      Parking. Lessee shall be entitled to use the number
      of Parking Spaces specified in Paragraph 1.2(b) on those portions of the Common
      Areas designated from time to time by Lessor for parking. Lessee shall not use
      more parking spaces than said number. Said parking
    

    
       
    

    	
          
            

            
          

        	
          
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            INITIALS
          

        	
          
             
          

        	
          
            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    

    
    

    
    
      spaces shall be used for parking by
      vehicles no larger than full-size passenger automobiles or pick-up trucks,
      herein called “Permitted Size
      Vehicles.” Lessor may regulate the loading and
      unloading of vehicles by adopting Rules and Regulations as provided in
      Paragraph 2.9. No vehicles other than Permitted Size Vehicles may be parked in
      the Common Area without the prior written permission of Lessor. In
      addition:
    

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

    
      (b)     Lessee shall not service or store any vehicles in the Common
      Areas.
    

    
      (c)     If
      Lessee permits or allows any of the prohibited activities described in this
      Paragraph 2.6, then Lessor shall have the right, without notice, in addition to
      such other rights and remedies that it may have, to remove or tow away the
      vehicle involved and charge the cost to Lessee, which cost shall be immediately
      payable upon demand by Lessor.
    

    
      2.7    Common Areas -
      Definition. The term “Common Areas” is defined as all
      areas and facilities outside the Premises and within the exterior boundary line
      of the Project and interior utility raceways and installations within the Unit
      that are provided and designated by the Lessor from time to time for the
      general non-exclusive use of Lessor, Lessee and other tenants of the Project
      and their respective employees, suppliers, shippers, customers, contractors and
      invitees, including parking areas, loading and unloading areas, trash areas,
      roadways, walkways, driveways and landscaped areas.
    

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

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

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

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

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

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

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

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

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

    	
          
            3.
          

        	
          
            Term.
          

        

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

    
      3.2    Early
      Possession. If Lessee totally or partially occupies
      the Premises prior to the Commencement Date, the obligation to pay Base Rent
      shall be abated for the period of such early possession. All other terms of
      this Lease (including but not limited to the obligations to pay Lessee’s
      Share of Common Area Operating Expenses, Real Property Taxes and insurance
      premiums and to maintain the Premises) shall be in effect during such period.
      Any such early possession shall not affect the Expiration Date.
    

    
      3.3    Delay In
      Possession. Lessor agrees to use its best
      commercially reasonable efforts to deliver possession of the Premises to Lessee
      by the Commencement Date. If, despite said efforts, Lessor is unable to deliver
      possession as agreed, Lessor shall not be subject to any liability therefor,
      nor shall such failure affect the validity of this Lease or change the
      Expiration Date. Lessee shall not, however, be obligated to pay Rent or perform
      its other obligations until Lessor delivers possession of the Premises and any
      period of rent abatement that Lessee would otherwise have enjoyed shall run
      from the date of the delivery of possession and continue for a period equal to
      what Lessee would otherwise have enjoyed, but minus any days of delay caused by
      the acts or omissions of Lessee. If possession is not delivered within 60 days
      after the Commencement Date, Lessee may, at its option, by notice in writing
      within 10 days after the end of such 60 day period, cancel this Lease, in which
      event the Parties shall be discharged from all obligations hereunder. If such
      written notice is not received by Lessor within said 10 day period,
      Lessee’s right to cancel shall terminate. Except as otherwise provided, if
      possession is not tendered to Lessee by the Start Date and Lessee does not
      terminate this Lease, as aforesaid, any period of rent abatement that Lessee
      would otherwise have enjoyed shall run from the date of delivery of possession
      and continue for a period equal to what Lessee would otherwise have enjoyed
      under the terms hereof, but minus any days of delay caused by the acts or
      omissions of Lessee. If possession of the Premises is not delivered within 4
      months after the Commencement Date, this Lease shall terminate unless other
      agreements are reached between Lessor and Lessee, in writing.
    

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

    	
          
            4.
          

        	
          
            Rent.
          

        

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

    
      4.2    Common Area
      Operating Expenses. Lessee shall pay to Lessor during
      the term hereof, in addition to the Base Rent, Lessee’s Share (as
      specified in Paragraph 1.6) of all Common Area Operating Expenses, as
      hereinafter defined, during each calendar year of the term of this Lease, in
      accordance with the following provisions:
    

    
      (a)     “Common
      Area Operating Expenses” are defined, for
      purposes of this Lease, as all costs incurred by Lessor relating to the
      ownership and operation of the Project,
      including, but not limited to, the following:
    

    
       
    

    	
          
            

            
          

        	
          
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            INITIALS
          

        	
          
             
          

        	
          
            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    

    
    

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

    
      (aa)   The
      Common Area and Common Area improvements, including parking areas, loading and
      unloading areas, trash areas, roadways, parkways, walkways, driveways,
      landscaped areas, bumpers, irrigation systems, Common Area lighting facilities,
      fences and gates, elevators, roofs, and roof drainage
      systems.
    

    
      (bb)   Exterior signs and any tenant
      directories.
    

    
      (cc)   Any fire sprinkler
      systems.
    

    
      (ii)      The cost of water,
      gas, electricity and telephone to service the Common Area and any utilities not
      separately metered.
    

    
      (iii)     Trash disposal,-post
      control services, property management, security services, owner’s
      association dues and fees, the cost to repaint the exterior of any structures
      and the cost of any environmental inspections,
    

    
      (iv)     Reserves set aside for
      maintenance and repair of Common Areas and Common Area
      equipment,
    

    
      (v)     Any increase above the Base Real Property
      Taxes (as defined in Paragraph 10),
    

    
      (vi)     Any “Insurance Cost
      Increase” (as defined in Paragraph 8),
    

    
      (vii)    Any deductible portion of an insured loss concerning the Building or
      the Common Areas.
    

    
      (viii)   Auditors’, accountants’ and
      attorneys’ fees and costs related to the operation, maintenance, repair
      and replacement of the Project,
    

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

    
      (x)     Any other services to be
      provided by Lessor that are stated elsewhere in the Lease to be a Common Area
      Operating Expense,
    

    
      (b)     Any
      Common Area Operating Expenses and Real Property Taxes that are specifically
      attributable to the Unit, the Building or to any other building in the Project
      or to the operation, repair and maintenance thereof, shall be allocated
      entirely to such Unit, Building, or other building. However, any Common Area
      Operating Expenses and Real Property Taxes that are not specifically
      attributable to the Building or to any other building or to the operation,
      repair and maintenance thereof, shall be equitably allocated by Lessor to all
      buildings in the Project.
    

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

    
      (d)     Lessee’s Share of Common Area
      Operating Expenses is payable monthly on the same day as the Base Rent is due
      hereunder. The amount of such payments shall be based on Lessor’s estimate
      of the annual Common Area Operating Expenses. Within 60 days after written
      request (but not more than once each year) Lessor shall deliver to Lessee a
      reasonably detailed statement showing Lessee’s Share of the actual Common
      Area Operating Expenses incurred during the preceding year. If Lessee’s
      payments during such year exceed Lessee’s Share, Lessor shall credit the
      amount of such over-payment against Lessee’s future payments. If
      Lessee’s payments during such year were less than Lessee’s Share,
      Lessee shall pay to Lessor the amount of the deficiency within 10 days after
      delivery by Lessor to Lessee of the statement.
    

    
      (e)       Except as provided in paragraph 4.2(a)(viii),
      Common Area Operating Expenses shall not include the cost of replacing
      equipment or capital components such as the roof, foundations, exterior walls
      or Common Area capital improvements, such as the parking lot paving, elevators,
      fences that have a useful life for accounting purposes of 5 years or more.
    

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

    
      4.3     Payment. Lessee shall cause payment of Rent
      to be received by Lessor in lawful money of the United States, without offset
      or deduction (except as specifically permitted in this Lease), on or before the
      day on which it is due. All monetary amounts shall be rounded to the nearest
      whole dollar. In the event that any statement or invoice prepared by Lessor is
      inaccurate such inaccuracy shall not constitute a waiver and Lessee shall be
      obligated to pay the amount set forth in this Lease. Rent for any period during
      the term hereof which is for less than one full calendar month shall be
      prorated based upon the actual number of days of said month. Payment of Rent
      shall be made to Lessor at its address stated herein or to such other persons
      or place as Lessor may from time to time designate in writing. Acceptance of a
      payment which is less than the amount then due shall not be a waiver of
      Lessor’s rights to the balance of such Rent, regardless of Lessor’s
      endorsement of any check so stating. In the event that any check, draft, or
      other instrument of payment given by Lessee to Lessor is dishonored for any
      reason, Lessee agrees to pay to Lessor the sum of $25
      in addition to any Late Charge and Lessor, at its
      option, may require all future Rent be paid by cashier’s check. Payments
      will be applied first to accrued late charges and attorney’s fees, second
      to accrued interest, then to Base Rent and Common Area Operating Expenses, and
      any remaining amount to any other outstanding charges or costs.
    

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

    	
          
            6.
          

        	
          
            Use.
          

        

    
      6.1    Use. Lessee shall use and occupy the
      Premises only for the Agreed Use, or any other legal use which is reasonably
      comparable thereto, and for no other purpose. Lessee shall not use or permit
      the use of the Premises in a manner that is unlawful, creates damage, waste or
      a nuisance, or that disturbs occupants of or causes damage to neighboring
      premises or properties. Other than guide, signal and seeing eye dogs, Lessee
      shall not keep or allow in the Premises any pets, animals, birds, fish, or
      reptiles. Lessor shall not unreasonably withhold or delay its consent to any
      written request for a modification of the Agreed Use, so long as the same will
      not impair the structural integrity of the Building or the mechanical
      or
    

    
       
    

    	
          
            

            
          

        	
          
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            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    

    
    

    
    
       
    

    
      electrical systems therein, and/or is
      not significantly more burdensome to the Project. If Lessor elects to withhold
      consent, Lessor shall within 7 days after such request give written
      notification of same, which notice shall include an explanation of
      Lessor’s objections to the change in the Agreed Use.
    

    	
          
             
          

        	
          
            6.2
          

        	
          
            Hazardous
            Substances.
          

        

    
      (a)     Reportable
      Uses Require Consent. The term “Hazardous Substance” as used in
      this Lease shall mean any product, substance, or waste whose presence, use,
      manufacture, disposal, transportation, or release, either by itself or in
      combination with other materials expected to be on the Premises, is either: (i)
      potentially injurious to the public health, safety or welfare, the environment
      or the Premises, (ii) regulated or monitored by any governmental authority, or
      (iii) a basis for potential liability of Lessor to any governmental agency or
      third party under any applicable statute or common law theory. Hazardous
      Substances shall include, but not be limited to, hydrocarbons, petroleum,
      gasoline, and/or crude oil or any products, by-products or fractions thereof.
      Lessee shall not engage in any activity in or on the Premises which constitutes
      a Reportable Use of Hazardous Substances without the express prior written
      consent of Lessor and timely compliance (at Lessee’s expense) with all
      Applicable Requirements. “Reportable Use” shall mean (i) the
      installation or use of any above or below ground storage tank, (ii) the
      generation, possession, storage, use, transportation, or disposal of a
      Hazardous Substance that requires a permit from, or with respect to which a
      report, notice, registration or business plan is required to be filed with, any
      governmental authority, and/or (iii) the presence at the Premises of a
      Hazardous Substance with respect to which any Applicable Requirements requires
      that a notice be given to persons entering or occupying the Premises or
      neighboring properties. Notwithstanding the foregoing, Lessee may use any
      ordinary and customary materials reasonably required to be used in the normal
      course of the Agreed Use, ordinary office supplies (copier toner, liquid paper,
      glue, etc.) and common household cleaning materials, so long as such use is in
      compliance with all Applicable Requirements, is not a Reportable Use, and does
      not expose the Premises or neighboring property to any meaningful risk of
      contamination or damage or expose Lessor to any liability therefor. In
      addition, Lessor may condition its consent to any Reportable Use upon receiving
      such additional assurances as Lessor reasonably deems necessary to protect
      itself, the public, the Premises and/or the environment against damage,
      contamination, injury and/or liability, including, but not limited to, the
      installation (and removal on or before Lease expiration or termination) of
      protective modifications (such as concrete encasements) and/or increasing the
      Security Deposit.
    

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

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

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

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

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

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

    
      6.3     Lessee’s Compliance with Applicable Requirements. Except as otherwise provided in this Lease, Lessee shall, at
      Lessee’s sole expense, fully, diligently and in a timely manner,
      materially comply with all Applicable Requirements, the requirements of any
      applicable fire insurance underwriter or rating bureau, and the recommendations
      of Lessor’s engineers and/or consultants which relate in any manner to
      such Requirements, without regard to whether said Requirements are now in
      effect or become effective after the Start Date. Lessee shall, within 10 days
      after receipt of Lessor’s written request, provide Lessor with copies of
      all permits and other documents, and other information evidencing Lessee’s
      compliance with any Applicable Requirements specified by Lessor, and shall
      immediately upon receipt, notify Lessor in writing (with copies of any
      documents involved) of any threatened or actual claim, notice, citation,
      warning, complaint or report pertaining to or involving the failure of Lessee
      or the Premises to comply with any Applicable Requirements. Likewise, Lessee
      shall immediately give written notice to Lessor of: (i) any water damage to the
      Premises and any suspected seepage, pooling, dampness or other condition
      conducive to the production of mold; or (ii) any mustiness or other
      odors
    

    
       
 
 
    

    	
          
            

            
          

        	
          
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            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
      
 

    

    
       
    

    

    
    

    
    
      that might indicate the presence of
      mold in the Premises. 
    

    
      6.4     Inspection;
      Compliance. Lessor and Lessor’s "Lender" (as defined in Paragraph 30) and
      consultants shall have the right to enter into Premises at any time, in the
      case of an emergency, and otherwise at reasonable times after reasonable
      notice, for the purpose of inspecting the condition of the Premises and for
      verifying compliance by Lessee with this Lease. The cost of any such
      inspections shall be paid by Lessor, unless a violation of Applicable
      Requirements, or a Hazardous Substance condition (see Paragraph 9.1) is found
      to exist or be imminent, or the inspection is requested or ordered by a
      governmental authority. In such case, Lessee shall upon request reimburse
      Lessor for the cost of such inspection, so long as such inspection is
      reasonably related to the violation or contamination. In addition, Lessee shall
      provide copies of all relevant material safety data sheets (MSDS) to Lessor
      within 10 days of the receipt of written request therefor. 
    

    	
          
            7.
          

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

        

    	
          
             
          

        	
          
            7.1
          

        	
          
            Lessee’s
            Obligations
          

        

    
      (a)     In
      General. Subject to the provisions of Paragraph 2.2
      (Condition), 2.3 (Compliance), 6.3 (Lessee’s Compliance with Applicable
      Requirements), 7.2 (Lessor’s Obligations), 9 (Damage or Destruction), and
      14 (Condemnation), Lessee shall, at Lessee’s sole expense, keep the
      Premises, Utility Installations (intended for Lessee’s exclusive use, no
      matter where located), and Alterations in good order, condition and repair
      (whether or not the portion of the Premises requiring repairs, or the means of
      repairing the same, are reasonably or readily accessible to Lessee, and whether
      or not the need for such repairs occurs as a result of Lessee’s use, any
      prior use, the elements or the age of such portion of the Premises), including,
      but not limited to, all equipment or facilities, such as plumbing, HVAC
      equipment, electrical, lighting facilities, boilers, pressure vessels,
      fixtures, interior walls, interior surfaces of exterior walls, ceilings,
      floors, windows, doors, plate glass, and skylights but excluding any items
      which are the responsibility of Lessor pursuant to Paragraph 7.2. Lessee, in
      keeping the Premises in good order, condition and repair, shall exercise and
      perform good maintenance practices, specifically including the procurement and
      maintenance of the service contracts required by Paragraph 7.1(b) below.
      Lessee’s obligations shall Include restorations, replacements or renewals
      when necessary to keep the Premises and all improvements thereon or a part
      thereof in good order, condition and state of repair.
    

    
      (b)     Service
      Contracts. Lessee shall, at Lessee’s sole
      expense, procure and maintain contracts, with copies to Lessor, in customary
      form and substance for, and with contractors specializing and experienced in
      the maintenance of the following equipment and improvements, if any, if and
      when installed on the Premises: (i) HVAC equipment, (ii) boiler and pressure
      vessels, (iii) clarifiers, and (iv) any other equipment, if reasonably required
      by Lessor. However, Lessor reserves the right, upon notice to Lessee, to
      procure and maintain any or all of such service contracts, and Lessee shall
      reimburse Lessor, upon demand, for the cost thereof.
    

    
      (c)      Failure to Perform. If Lessee fails to
      perform Lessee’s obligations under this Paragraph 7.1, Lessor may enter
      upon the Premises after 10 days’ prior written notice to Lessee (except in
      the case of an emergency, in which case no notice shall be required), perform
      such obligations on Lessee’s behalf, and put the Premises in good order,
      condition and repair, and Lessee shall promptly pay to Lessor a sum equal to
      115% of the cost thereof.
    

    
      (d)     Replacement. Subject to Lessee’s
      indemnification of Lessor as set forth in Paragraph 8.7 below, and without
      relieving Lessee of liability resulting from Lessee’s failure to exercise
      and perform good maintenance practices, if an item described in Paragraph
      7.1(b) cannot be repaired other than at a cost which is in excess of 50% of the
      cost of replacing such item, then such item shall be replaced by Lessor, and
      the cost thereof shall be prorated between the Parties and Lessee shall only be
      obligated to pay, each month during the remainder of the term of this Lease, on
      the date on which Base Rent is due, an amount equal to the product of
      multiplying the cost of such replacement by a fraction, the numerator of which
      is one, and the denominator of which is 144 (ie. 1/144th of the cost per
      month). Lessee shall pay interest on the unamortized balance but may prepay its
      obligation at any time.
    

    
      7.2    Lessor’s
      Obligations. Subject to the provisions of Paragraphs
      2.2 (Condition), 2.3 (Compliance), 4.2 (Common Area Operating Expenses), 6
      (Use), 7.1 (Lessee’s Obligations), 9 (Damage or Destruction) and 14
      (Condemnation), Lessor, subject to reimbursement pursuant to Paragraph 4.2,
      shall keep in good order, condition and repair the foundations, exterior walls,
      structural condition of interior bearing walls, exterior roof, fire sprinkler
      system, Common Area fire alarm and/or smoke detection systems, fire hydrants,
      parking lots, walkways, parkways, driveways, landscaping, fences, signs and
      utility systems serving the Common Areas and all parts thereof, as well as
      providing the services for which there is a Common Area Operating Expense
      pursuant to Paragraph 4.2. Lessor shall not be obligated to paint the exterior
      or interior surfaces of exterior walls nor shall Lessor be obligated to
      maintain, repair or replace windows, doors or plate glass of the Premises.
      Lessee expressly waives the benefit of any statute now or hereafter in effect
      to the extent it is inconsistent with the terms of this Lease.
    

    	
          
             
          

        	
          
            7.3
          

        	
          
            Utility Installations; Trade
            Fixtures; Alterations.
          

        

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

    
      (b)     Consent. Lessee shall not make any
      Alterations or Utility Installations to the Premises without Lessor’s
      prior written consent. Lessee may, however, make non-structural Utility
      Installations to the interior of the Premises (excluding the roof) without such
      consent but upon notice to Lessor, as long as they are not visible from the
      outside, do not involve puncturing, relocating or removing the roof or any
      existing walls, will not affect the electrical, plumbing, HVAC, and/or life
      safety systems, and the cumulative cost thereof during this Lease as extended
      does not exceed a sum equal to 3 month’s Base Rent in the aggregate or a
      sum equal to one month’s Base Rent in any one year. Notwithstanding the
      foregoing, Lessee shall not make or permit any roof penetrations and/or install
      anything on the roof without the prior written approval of Lessor. Lessor may,
      as a precondition to granting such approval, require Lessee to utilize a
      contractor chosen and/or approved by Lessor. Any Alterations or Utility
      Installations that Lessee shall desire to make and which require the consent of
      the Lessor shall be presented to Lessor in written form with detailed plans.
      Consent shall be deemed conditioned upon Lessee’s: (i) acquiring all
      applicable governmental permits, (ii) furnishing Lessor with copies of both the
      permits and the plans and specifications prior to commencement of the work, and
      (iii) compliance with all conditions of said permits and other Applicable
      Requirements in a prompt and expeditious manner. Any Alterations or Utility
      Installations shall be performed in a workmanlike manner with good and
      sufficient materials. Lessee shall promptly upon completion furnish Lessor with
      as-built plans and specifications. For work which costs an amount in excess of
      one month’s Base Rent, Lessor may condition its consent upon Lessee
      providing a lien and completion bond in an amount equal to 150% of the
      estimated cost of such Alteration or Utility Installation and/or upon
      Lessee’s posting an additional Security Deposit with Lessor.
    

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

    
       
    

    	
          
            

            
          

        	
          
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            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

 
 

    
       
    

    

    
    

    
    
      Lessee shall pay Lessor’s
      attorneys’ fees and costs.
    

    	
          
             
          

        	
          
            7.4
          

        	
          
            Ownership; Removal; Surrender;
            and Restoration.
          

        

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

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

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

    	
          
            8.
          

        	
          
            Insurance;
            Indemnity.
          

        

    	
          
             
          

        	
          
            8.1
          

        	
          
            Payment of Premium
            Increases.
          

        

    
      (a)     As
      used herein, the term “Insurance Cost Increase” is defined as any
      increase in the actual cost of the insurance applicable to the Building and/or
      the Project and required to be carried by Lessor, pursuant to Paragraphs
      8.2(b), 8.3(a) and 8.3(b), ( “Required Insurance”), over and above
      the Base Premium, as hereinafter defined, calculated on an annual basis.
      Insurance Cost Increase shall include, but not be limited to, requirements of
      the holder of a mortgage or deed of trust covering the Premises, Building
      and/or Project, increased valuation of the Premises, Building and/or Project,
      and/or a general premium rate increase. The term Insurance Cost Increase shall
      not, however, include any premium increases resulting from the nature of the
      occupancy of any other tenant of the Building. If the parties insert a dollar
      amount in Paragraph 1.9, such amount shall be considered the “Base Premium.” The Base Premium
      shall be the annual premium applicable to the 12 month period immediately
      preceding the Start Date. If, however, the Project was not insured for the
      entirety of such 12 month period, then the Base Premium shall be the lowest
      annual premium reasonably obtainable for the Required Insurance as of the Start
      Date, assuming the most nominal use possible of the Building. In no event,
      however, shall Lessee be responsible for any portion of the premium cost
      attributable to liability insurance coverage in excess of $2,000,000 procured
      under Paragraph 8.2(b). 
    

    
      (b) Lessee shall pay any Insurance Cost
      Increase to Lessor pursuant to Paragraph 4.2. Premiums for policy periods
      commencing prior to, or extending beyond, the term of this Lease shall be
      prorated to coincide with the corresponding Start Date or Expiration
      Date.
    

    	
          
             
          

        	
          
            8.2
          

        	
          
            Liability
            Insurance.
          

        

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

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

    	
          
             
          

        	
          
            8.3
          

        	
          
            Property Insurance - Building,
            Improvements and Rental Value. See Addendum Para.
            #59.
          

        

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

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

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

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

    
       
    

    	
          
            

            
          

        	
          
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            INITIALS
          

        	
          
             
          

        	
          
            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

 
 

    
       
    

    

    
    

    
    
       
    

    	
          
            8.4
          

        	
          
            Lessee’s Property;
            Business Interruption Insurance.
          

        

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

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

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

    
      8.5     Insurance
      Policies. Insurance required herein shall be by
      companies duly licensed or admitted to transact business in the state where the
      Premises are located, and maintaining during the policy term a “General
      Policyholders Rating” of at least A-, VI, as set forth in the most current
      issue of “Best’s Insurance Guide”, or such other rating as may
      be required by a Lender. Lessee shall not do or permit to be done anything
      which invalidates the required insurance policies. Lessee shall, prior to the
      Start Date, deliver to Lessor certified copies of policies of such insurance or
      certificates evidencing the existence and amounts of the required insurance. No
      such policy shall be cancelable or subject to modification except after 30 days
      prior written notice to Lessor. Lessee shall, at least 10 days prior to the
      expiration of such policies, furnish Lessor with evidence of renewals or
      “insurance binders” evidencing renewal thereof, or Lessor may order
      such insurance and charge the cost thereof to Lessee, which amount shall be
      payable by Lessee to Lessor upon demand. Such policies shall be for a term of
      at least one year, or the length of the remaining term of this Lease, whichever
      is less. If either Party shall fail to procure and maintain the insurance
      required to be carried by it, the other Party may, but shall not be required
      to, procure and maintain the same.
    

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

    
      8.7     Indemnity. Except for Lessor’s gross
      negligence or willful misconduct, Lessee shall indemnify, protect, defend and
      hold harmless the Premises, Lessor and its agents, Lessor’s master or
      ground lessor, partners and Lenders, from and against any and all claims, loss
      of rents and/or damages, liens, judgments, penalties, attorneys’ and
      consultants’ fees, expenses and/or liabilities arising out of, involving,
      or in connection with, the use and/or occupancy of the Premises by Lessee. If
      any action or proceeding is brought against Lessor by reason of any of the
      foregoing matters, Lessee shall upon notice defend the same at Lessee’s
      expense by counsel reasonably satisfactory to Lessor and Lessor shall cooperate
      with Lessee in such defense. Lessor need not have first paid any such claim in
      order to be defended or indemnified.
    

    
      8.8    Exemption of
      Lessor from Liability. Lessor shall not be liable for
      injury or damage to the person or goods, wares, merchandise or other property
      of Lessee, Lessee’s employees, contractors, invitees, customers, or any
      other person in or about the Premises, whether such damage or injury is caused
      by or results from fire, steam, electricity, gas, water or rain, indoor air
      quality, the presence of mold or from the breakage, leakage, obstruction or
      other defects of pipes, fire sprinklers, wires, appliances, plumbing, HVAC or
      lighting fixtures, or from any other cause, whether the said injury or damage
      results from conditions arising upon the Premises or upon other portions of the
      Building, or from other sources or places. Lessor shall not be liable for any
      damages arising from any act or neglect of any <Page Continue>other
      tenant of Lessor nor from the failure of Lessor to enforce the provisions of
      any other lease in the Project. Notwithstanding Lessor’s negligence or
      breach of this Lease, Lessor shall under no circumstances be liable for injury
      to Lessee’s business or for any loss of income or profit
      therefrom.
    

    
      8.9    Failure to Provide
      Insurance. Lessee acknowledges that any failure on
      its part to obtain or maintain the insurance required herein will expose Lessor
      to risks and potentially cause Lessor to incur costs not contemplated by this
      Lease, the extent of which will be extremely difficult to ascertain.
      Accordingly, for any month or portion thereof that Lessee does not maintain the
      required insurance and/or does not provide Lessor with the required binders or
      certificates evidencing the existence of the required insurance, the Base Rent
      shall be automatically Increased, without any requirement for notice to Lessee,
      by an amount equal to 10% of the then existing Base Rent or $100, whichever is
      greater. The parties agree that such increase in Base Rent represents fair and
      reasonable compensation for the additional risk/costs that Lessor will incur by
      reason of Lessee’s failure to maintain the required insurance. Such
      increase in Base Rent shall in no event constitute a waiver of Lessee’s
      Default or Breach with respect to the failure to maintain such insurance,
      prevent the exercise of any of the other rights and remedies granted hereunder,
      nor relieve Lessee of its obligation to maintain the insurance specified in
      this Lease. 
    

    	
          
            9.
          

        	
          
            Damage or
            Destruction.
          

        
	
          
             
          

        	
          
            9.1
          

        	
          
            Definitions.
          

        	
          
             
          

        
					

    
      (a)
      “Premises Partial Damage” shall mean damage
      or destruction to the improvements on the Premises, other than Lessee Owned
      Alterations and Utility Installations, which can reasonably be repaired in 3
      months or less from the date of the damage or destruction, and the cost thereof
      does not exceed a sum equal to 6 month’s Base Rent. Lessor shall notify
      Lessee in writing within 30 days from the date of the damage or destruction as
      to whether or not the damage is Partial or Total, Notwithstanding the
      foregoing, Premises Partial Damage shall not include damage to windows, doors,
      and/or other similar items which Lessee has the responsibility to repair or
      replace pursuant to the provisions of Paragraph 7.1.
    

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

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

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

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

    
      9.2     Partial
      Damage - Insured Loss. If a Premises Partial Damage
      that is an Insured Loss occurs, then Lessor shall, at Lessor’s expense,
      repair such damage (but not Lessee’s Trade Fixtures or Lessee Owned
      Alterations and Utility Installations) as soon as reasonably possible and this
      Lease shall continue in full force and effect; provided, however, that Lessee
      shall, at Lessor’s election, make the repair of any damage or destruction
      the total cost to repair of which is $10,000 or less, and, in such event,
      Lessor shall make any applicable insurance proceeds available to Lessee on a
      reasonable basis for that purpose. Notwithstanding the foregoing, if the
      required insurance was not in force or the insurance proceeds are
    

    
       
    

    	
          
            

            
          

        	
          
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            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

 
 

    
       
    

    

    
    

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

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

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

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

    	
          
            9.6
          

        	
          
            Abatement of Rent;
            Lessee’s Remedies.
          

        

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

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

    
      9.7    Termination;
      Advance Payments. Upon termination of this Lease
      pursuant to Paragraph 6.2(g) or Paragraph 9, an equitable adjustment shall be
      made concerning advance Base Rent and any other advance payments made by Lessee
      to Lessor. Lessor shall, in addition, return to Lessee so much of Lessee’s
      Security Deposit as has not been, or is not then required to be, used by
      Lessor.
    

    
      9.8     Waive
      Statutes. Lessor and Lessee agree that the terms of
      this Lease shall govern the effect of any damage to or destruction of the
      Premises with respect to the termination of this Lease and hereby waive the
      provisions of any present or future statute to the extent inconsistent
      herewith.
    

    	
          
            10.
          

        	
          
            Real Property
            Taxes.
          

        
	
          
             
          

        	
          
            10.1
          

        	
          
            Definitions.
          

        	
          
             
          

        
					

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

    
      (b) “Base
      Real Property Taxes.” As used herein, the term
      “Base Real Property Taxes” shall be the amount of Real Property Taxes, which are assessed
      against the Premises, Building, Project or Common Areas in the calendar year
      during which the Lease is executed. In calculating Real Property Taxes for any
      calendar year, the Real Property Taxes for any real estate tax year shall be
      included in the calculation of Real Property Taxes for such calendar year based
      upon the number of days which such calendar year and tax year have in
      common.
    

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

    
      10.3   Additional Improvements. Common Area
      Operating Expenses shall not include Real Property Taxes specified in the tax
      assessor’s records and work sheets as being caused by additional
      improvements placed upon the Project by other lessees or by Lessor for
      the
    

    
       
    

    	
          
            

            
          

        	
          
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            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    
 
 

    
    

    
    
      exclusive enjoyment of such other lessees. Notwithstanding Paragraph 10.2 hereof, Lessee shall, however, pay to
      Lessor at the time Common Area Operating Expenses are payable under Paragraph
      4.2, the entirety of any increase in Real Property Taxes if assessed solely by
      reason of Alterations, Trade Fixtures or Utility Installations placed upon the
      Premises by Lessee or at Lessee’s request or by reason of any alterations
      or improvements to the Premises made by Lessor subsequent to the execution of
      this Lease by the Parties.
    

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

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

    
      11.    Utilities and
      Services. Lessee shall pay for all water, gas, heat,
      light, power, telephone, trash disposal and other utilities and services
      supplied to the Premises, together with any taxes thereon. Notwithstanding the
      provisions of Paragraph 4.2, if at any time in Lessor’s sole judgment,
      Lessor determines that Lessee is using a disproportionate amount of water,
      electricity or other commonly metered utilities, or that Lessee is generating
      such a large volume of trash as to require an increase in the size of the trash
      receptacle and/or an increase in the number of times per month that it is
      emptied, then Lessor may Increase Lessee’s Base Rent by an amount equal to
      such increased costs. There shall be no abatement of Rent and Lessor shall not
      be liable in any respect whatsoever for the inadequacy, stoppage, interruption
      or discontinuance of any utility or service due to riot, strike, labor dispute,
      breakdown, accident, repair or other cause beyond Lessor’s reasonable
      control or in cooperation with governmental request or
      directions.
    

    	
          
            12.
          

        	
          
            Assignment and Subletting. See
            Addendum Para. #58.
          

        
	
          
             
          

        	
          
            12.1
          

        	
          
            Lessor’s Consent
            Required.
          

        	
          
             
          

        
					

    
      (a) Lessee shall not voluntarily or by
      operation of law assign, transfer, mortgage or encumber (collectively,
      “assign or assignment”) or sublet all or any part of Lessee’s interest in this
      Lease or in the Premises without Lessor’s prior written
      consent.
    

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

    
      (c) The involvement of Lessee or its
      assets in any transaction, or series of transactions (by way of merger, sale,
      acquisition, financing, transfer, leveraged buy-out or otherwise), whether or
      not a formal assignment or hypothecation of this Lease or Lessee’s assets
      occurs, which results or will result in a
      reduction of the Net Worth of Lessee by an amount
      greater than 25% of such Net Worth as it was represented at the time of the
      execution of this Lease or at the time of the most recent assignment to which
      Lessor has consented, or as it exists immediately prior to said transaction or
      transactions constituting such reduction, whichever was or is greater, shall be
      considered an assignment of this Lease to which Lessor may withhold its
      consent. “Net Worth of Lessee” shall mean the net worth of Lessee (excluding any guarantors)
      established under generally accepted accounting principles.
    

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

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

    
      (f) Lessor may reasonably withhold
      consent to a proposed assignment or subletting if Lessee is in Default at the
      time consent is requested.
    

    
      (g) Notwithstanding the foregoing,
      allowing a diminimus portion of the Premises, ie. 20 square feet or less, to be
      used by a third party vendor in connection with the installation of a vending
      machine or payphone shall not constitute a subletting.
    

    	
          
            12.2
          

        	
          
            Terms and Conditions
            Applicable to Assignment and Subletting.
          

        

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

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

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

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

    
      (e) Each request for consent to an
      assignment or subletting shall be in writing, accompanied by information
      relevant to Lessor’s determination as to the financial and operational
      responsibility and appropriateness of the proposed assignee or sublessee,
      including but not limited to the intended use and/or required modification of
      the Premises, if any, together with a fee of $500 as consideration for
      Lessor’s considering and processing said request. Lessee agrees to provide
      Lessor with such other or additional information and/or documentation as may be
      reasonably requested. (See also Paragraph 36)
    

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

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

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

    
      (a) Lessee hereby assigns and transfers
      to Lessor all of Lessee’s interest in all Rent payable on any sublease,
      and Lessor may collect such Rent and apply same toward Lessee’s
      obligations under this Lease; provided, however, that until a Breach shall
      occur in the performance
    

    
       
    

    	
          
            

            
          

        	
          
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            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    

    
    

    
    
       
    

    
      of Lessee's obligations, Lessee may
      collect said Rent. In the event that the amount collected by Lessor exceeds
      Lessee's then outstanding obligations any such excess shall be refunded to
      Lessee. Lessor shall not, by reason of the foregoing or any assignment of such
      sublease, nor by reason of the collection of Rent, be deemed liable to the
      sublessee for any failure of Lessee to perform and comply with any of Lessee's
      obligations to such sublessee. Lessee hereby irrevocably authorizes and directs
      any such sublessee, upon receipt of a written notice from Lessor stating that a
      Breach exists in the performance of Lessee's obligations under this Lease, to
      pay to Lessor all Rent due and to become due under the sublease. Sublessee
      shall rely upon any such notice from Lessor and shall pay all Rents to Lessor
      without any obligation or right to inquire as to whether such Breach exists,
      notwithstanding any claim from Lessee to the contrary.
    

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

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

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

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

    	
          
            13.
          

        	
          
            Default; Breach;
            Remedies. See Addendum Paragraph #64 &
            #66.
          

        

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

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

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

    
      (c)     The
      commission of waste, act or acts constituting public or private nuisance,
      and/or an illegal activity on the Premises by Lessee, where such actions
      continue for a period of 3 business days following written notice to
      Lessee.
    

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

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

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

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

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

    
      13.2   Remedies. If Lessee fails to perform
      any of its affirmative duties or obligations, within 10 days after written
      notice (or in case of an emergency, without notice), Lessor may, at its option,
      perform such duty or obligation on Lessee's behalf, including but not limited
      to the obtaining of reasonably required bonds, insurance policies, or
      governmental licenses, permits or approvals. Lessee shall pay to Lessor an
      amount equal to 115% of the costs and expenses incurred by Lessor in such
      performance upon receipt of an invoice therefor. In the event of a Breach,
      Lessor may, with or without further notice or demand, and without limiting
      Lessor in the exercise of any right or remedy which Lessor may have by reason
      of such Breach:
    

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

    
       
 

    

    	
          
            

            
          

        	
          
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            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

 

    
       
    

    
 

    
    

    
    
      given to Lessee under the unlawful detainer statute shall
      also constitute the notice required by Paragraph 13.1. In such case, the
      applicable grace period required by Paragraph 13.1 and the unlawful detainer
      statute shall run concurrently, and the failure of Lessee to cure the Default
      within the greater of the two such grace periods shall constitute both an
      unlawful detainer and a Breach of this Lease entitling Lessor to the remedies
      provided for in this Lease and/or by said statute.
    

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

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

    
      13.3   Inducement Recapture. Any agreement
      for free or abated rent or other charges, or for the giving or paying by Lessor
      to or for Lessee of any cash or other bonus, inducement or consideration for
      Lessee's entering into this Lease, all of which concessions are hereinafter
      referred to as "Inducement Provisions" , shall be deemed conditioned upon Lessee's full and faithful
      performance of all of the terms, covenants and conditions of this Lease. Upon
      Breach of this Lease by Lessee, any such Inducement Provision shall
      automatically be deemed deleted from this Lease and of no further force or
      effect, and any rent, other charge, bonus, inducement or consideration
      theretofore abated, given or paid by Lessor under such an Inducement Provision
      shall be immediately due and payable by Lessee to Lessor, notwithstanding any
      subsequent cure of said Breach by Lessee. The acceptance by Lessor of rent or
      the cure of the Breach which initiated the operation of this paragraph shall
      not be deemed a waiver by Lessor of the provisions of this paragraph unless
      specifically so stated in writing by Lessor at the time of such
      acceptance.
    

    
      13.4   Late Charges. Lessee hereby
      acknowledges that late payment by Lessee of Rent will cause Lessor to incur
      costs not contemplated by this Lease, the exact amount of which will be
      extremely difficult to ascertain. Such costs include, but are not limited to,
      processing and accounting charges, and late charges which may be imposed upon
      Lessor by any Lender. Accordingly, if any Rent shall not be received by Lessor
      within 5 days after such amount shall be due, then, without any requirement for
      notice to Lessee, Lessee shall immediately pay to Lessor a one-time late charge
      equal to 10% of each such overdue amount or $100, whichever is greater. The
      parties hereby agree that such late charge represents a fair and reasonable
      estimate of the costs Lessor will incur by reason of such late payment.
      Acceptance of such late charge by Lessor shall in no event constitute a waiver
      of Lessee's Default or Breach with respect to such overdue amount, nor prevent
      the exercise of any of the other rights and remedies granted hereunder. In the
      event that a late charge is payable hereunder, whether or not collected, for 3 consecutive installments of
      Base Rent, then notwithstanding any provision of this Lease to the contrary,
      Base Rent shall, at Lessor's
      option, become due and payable quarterly in advance.
    

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

    	
          
            13.6
          

        	
          
            Breach by
            Lessor.
          

        

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

    
      (b) Performance by Lessee on Behalf of Lessor.
      In the event that neither Lessor nor Lender cures said breach within 30 days
      after receipt of said notice, or if having commenced said cure they do not
      diligently pursue it to completion, then Lessee may elect to cure said breach
      at Lessee's expense and offset from Rent the actual and reasonable cost to
      perform such cure, provided however, that such offset shall not exceed an
      amount equal to the greater of one month's Base Rent or the Security Deposit,
      reserving Lessee's right to reimbursement from Lessor for any such expense in
      excess of such offset. Lessee shall document the cost of said cure and supply
      said documentation to Lessor.
    

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

    	
          
            15.
          

        	
          
            Brokerage
            Fees.
          

        

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

    
      15.2   Assumption of Obligations. Any buyer
      or transferee of Lessor's interest in this lease shall be deemed to have
      assumed Lessor's obligation hereunder, Brokers shall be third party
      beneficiaries of the provisions of Paragraph 1.10, 15, 22 and 31. If Lessor
      fails to pay to Brokers any amounts due as and for brokerage fees pertaining to
      this Lease when due, then such amounts shall accrue interest. In addition, If
      Lessor fails to pay any amounts to Lessee's Broker when due, Lessee's Broker
      may send written notice to Lessor and Lessee of such failure and if Lessor
      fails to pay such amounts within 10 days after said notice, Lessee shall pay
      said monies to its Broker and offset such amounts against Rent, In addition,
      Lessee's Broker shall be deemed to be a third party beneficiary of any
      commission agreement entered into by and/or between Lessor and Lessor's Broker
      for the limited purpose of collecting any brokerage fee
      owed.
    

    
      15.3   Representations and Indemnities of Broker
      Relationships. Lessee and Lessor each
      represent and warrant to the other that it has had no dealings with any person,
      firm, broker or finder (other than the Brokers, if any) in connection with this
      Lease, and that no one other than said
 
 
 
    

    	
          
            

            
          

        	
          
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            REAL ESTATE ASSOCIATION
          

        	
          
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      named Brokers is entitled to
      any commission or finder's fee in connection herewith, Lessee and Lessor do
      each hereby agree to indemnify, protect, defend and hold the other harmless
      from and against liability for compensation or charges which may be claimed by
      any such unnamed broker, finder or other similar party by reason of any
      dealings or actions of the indemnifying Party, including any costs, expenses,
      attorneys' fees reasonably incurred with respect
      thereto.
    

    	
          
            16.
          

        	
          
            Estoppel
            Certificates.
          

        

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

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

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

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

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

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

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

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

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

    	
          
            23.
          

        	
          
            Notices.
          

        

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

    
      23.2   Date of Notice. Any notice sent by
      registered or certified mail, return receipt requested, shall be deemed given
      on the date of delivery shown on the receipt card, or if no delivery date is
      shown, the postmark thereon. If sent by regular mail the notice shall
      be deemed given 72 hours after the same is addressed as required herein and
      mailed with postage prepaid. Notices delivered by United States
      Express Mail or overnight courier that guarantee next day delivery shall be
      deemed given 24 hours after delivery of the same to the Postal Service or
      courier. Notices transmitted by facsimile transmission or similar means
      shall be deemed delivered upon telephone confirmation of receipt (confirmation
      report from fax machine is sufficient), provided a copy is also delivered via
      delivery or mail. If notice is received on a Saturday, Sunday or legal
      holiday, it shall be deemed received on the next business day.
    

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

    	
          
            25.
          

        	
          
            Disclosures Regarding The
            Nature of a Real Estate Agency Relationship.
          

        

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

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

    
       
    

    	
          
            

            
          

        	
          
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            INITIALS
          

        	
          
             
          

        	
          
            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    
       
    

    
 

    
    

    
    
      confidential information obtained from
      the other Party which does not involve the affirmative duties set forth
      above.
    

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

    
      (iii)     Agent
      Representing Both Lessor and Lessee. A real
      estate agent, either acting directly or through one or more associate licenses,
      can legally be the agent of both the Lessor and the Lessee in a transaction,
      but only with the knowledge and consent of both the Lessor and the Lessee. In a
      dual agency situation, the agent has the following affirmative obligations to
      both the Lessor and the Lessee: a. A fiduciary duty of utmost care, integrity,
      honesty and loyalty in the dealings with either Lessor or the Lessee. b. Other
      duties to the Lessor and the Lessee as stated above in subparagraphs (i) or
      (ii). In representing both Lessor and Lessee, the agent may not without the
      express permission of the respective Party, disclose to the other Party that
      the Lessor will accept rent in an amount less than that indicated in the
      listing or that the Lessee is willing to pay a higher rent than that offered.
      The above duties of the agent in a real estate transaction do not relieve a
      Lessor or Lessee from the responsibility to protect their own interests. Lessor
      and Lessee should carefully read all agreements to assure that they adequately
      express their understanding of the transaction. A real estate agent is a person
      qualified to advise about real estate. If legal or tax advice is desired,
      consult a competent professional.
    

    
      (b)     Brokers have no responsibility with
      respect to any default or breach hereof by either Party. The Parties agree that
      no lawsuit or other legal proceeding involving any breach of duty, error or
      omission relating to this Lease may be brought against Broker more than one
      year after the Start Date and that the liability (including court costs and
      attorneys’ fees), of any Broker with respect to any such lawsuit and/or
      legal proceeding shall not exceed the fee received by such Broker pursuant to
      this Lease; provided, however, that the foregoing limitation on each
      Broker’s liability shall not be applicable to any gross negligence or
      willful misconduct of such Broker.
    

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

    
      26.    No Right To
      Holdover. Lessee has no right to retain possession of
      the Premises or any part thereof beyond the expiration or termination of this
      Lease. In the event that Lessee holds over then the Base Rent shall be
      increased to 150% of the Base Rent applicable immediately preceding the
      expiration or termination. Nothing contained herein shall be construed as
      consent by Lessor to any holding over by Lessee.
    

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

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

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

    	
          
            30.
          

        	
          
            Subordination; Attornment;
            Non-Disturbance.
          

        

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

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

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

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

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

    
       
    

    	
          
            

            
          

        	
          
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            INITIALS
          

        	
          
             
          

        	
          
            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    
       
    

    
       
    

    

    
    

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

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

    
      34.     Signs. Lessor may place on the Premises
      ordinary “For Sale” signs at any time and ordinary “For
      Lease” signs during the last 6 months of the term hereof. Except for
      ordinary “For Sublease” signs which may be placed only on the
      Premises, Lessee shall not place any sign upon the Project without
      Lessor’s prior written consent. All signs must comply with all Applicable
      Requirements.
    

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

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

    	
          
            37.
          

        	
          
            Guarantor.
          

        

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

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

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

    	
          
            39.
          

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

        

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

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

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

    	
          
             
          

        	
          
            39.4
          

        	
          
            Effect of Default on
            Options.
          

        

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

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

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

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

    
      41.    Reservations. Lessor reserves the right: (i)
      to grant, without the consent or joinder of Lessee, such easements, rights and
      dedications that Lessor deems necessary, (ii) to cause the recordation of
      parcel maps and restrictions, and (iii) to create and/or install new utility
      raceways, so long as such easements, rights, dedications, maps, restrictions,
      and utility raceways do not unreasonably interfere with the use of the Premises
      by Lessee. Lessee agrees to sign any documents reasonably requested by Lessor
      to effectuate such rights.
    

    
      42.     Performance
      Under Protest. If at any time a dispute shall arise
      as to any amount or sum of money to be paid by one Party to the other under the
      provisions hereof, the Party against whom the obligation to pay the money is
      asserted shall have the right to make payment “under protest” and
      such payment shall not be regarded as a voluntary payment and there shall
      survive the right on the part of said Party to institute suit for recovery of
      such sum. If it shall be adjudged that there was no legal obligation on the
      part of said Party to pay such sum or any part thereof, said Party shall be
      entitled to recover such sum or so much thereof as it was not legally required
      to pay. A Party who does not initiate suit for the recovery of sums paid
      “under protest” within 6 months shall be deemed to have waived its
      right to protest such payment.
    

    	
          
            43.
          

        	
          
            Authority.; Multiple Parties;
            Execution.
          

        

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

    
       
    

    	
          
            

            
          

        	
          
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            INITIALS
          

        	
          
             
          

        	
          
            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    
       
    

    
       
    

    

    
    

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

    
      (c) This Lease may be executed by the
      Parties in counterparts, each of which shall be deemed an original and all of
      which together shall constitute one and the same instrument.
    

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

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

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

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

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

    
      49.    Americans with
      Disabilities Act. Since compliance with the Americans
      with Disabilities Act (ADA) is dependent upon Lessee’s specific use of the
      Premises, Lessor makes no warranty or representation as to whether or not the
      Premises comply with ADA or any similar legislation. In the event that
      Lessee’s use of the Premises requires modifications or additions to the
      Premises in order to be in ADA compliance, Lessee agrees to make any such
      necessary modifications and/or additions at Lessee’s
      expense.
    

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

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

    	
          
            1.
          

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

        

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

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

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

    
       
    

    	
          
            Executed at: Tarzana,
            CA
          

        	
          
             
          

        	
          
            Executed: Chatsworth,
            CA
          

        
	
          
            On: November 22,
            2004
 

          

        	
          
             
          

        	
          
            On: November ,
            2004
 

          

        
	
          
            By LESSOR:
          

        	
          
             
          

        	
          
            By LESSEE:
          

        
	
          
            THE SCHOFIELD FAMILY
            TRUST
          

        	
          
             
          

        	
          
            TAG ENTERTAINMENT,
            INC.
          

        
	
          
            By:
          

        	
          
            
 
          

        	
          
             
          

        	
          
            By:
          

        	
          
            
 
          

        
	
          
            Name Printed: Miles
            Schofield
          

        	
          
             
          

        	
          
            Name Printed: Steve
            Austin
          

        
	
          
            Title: Trustee
          

        	
          
             
          

        	
          
            Title: President
          

        
	
          
             
          

        	
          
             
          

        	
          
             
          

        	
          
             
          

        	
          
             
          

        	
          
             
          

        
	
          
            By:
          

        	
          
            
 
          

        	
          
             
          

        	
          
            By:
          

        	
          
             
          

        
	
          
            Name Printed: Anne
            Schofield
          

        	
          
             
          

        	
          
            Name Printed:
          

        	
          
             
          

        
	
          
            Title:
          

        	
          
             
          

        	
          
             
          

        	
          
            Title: Secretary
          

        
	
          
            Address: 5949 Melvin
            Ave.
          

        	
          
             
          

        	
          
            Address: 9916 S. Santa Monica
            Blvd., 1st Floor
          

        
	
          
            Tarzana, CA 91356
          

        	
          
             
          

        	
          
             
          

        	
          
            Beverly Hills, CA
            90212
          

        
	
          
             
          

        	
          
             
          

        	
          
             
          

        	
          
             
          

        	
          
             
          

        
	
          
            Telephone: (818) 342-8881
          

        	
          
             
          

        	
          
            Telephone: (310)
            277–3700
          

        
	
          
            Facsimile: (       )
          

        	
          
             
          

        	
          
             
          

        	
          
            Facsimile: (310)
            277–3720
          

        
	
          
            Federal ID No.
          

        	
          
             
          

        	
          
             
          

        	
          
            Federal ID No.
          

        	
          
             
          

        
												

    
       
    

    
       
    

    	
          
            

            
          

        	
          
            PAGE 16 OF
            17
          

        	
          
            

          

        
	
          
            INITIALS
          

        	
          
             
          

        	
          
            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    

    
    

    
    	
          
            BROKER:
          

        	
          
             
          

        	
          
            BROKER:
          

        	
          
             
          

        
	
          
             
          

        	
          
             
          

        	
          
             
          

        	
          
             
          

        
	
          
             
          

        	
          
             
          

        	
          
             
          

        	
          
             
          

        
	
          
             
          

        	
          
             
          

        	
          
             
          

        	
          
             
          

        
	
          
            Att:
          

        	
          
             
          

        	
          
             
          

        	
          
            Att:
          

        	
          
             
          

        	
          
             
          

        
	
          
            Title: 
          

        	
          
             
          

        	
          
             
          

        	
          
            Title:
          

        	
          
             
          

        	
          
             
          

        
	
          
            Address:
          

        	
          
             
          

        	
          
             
          

        	
          
            Address:
          

        	
          
             
          

        
	
          
             
          

        	
          
             
          

        	
          
             
          

        	
          
             
          

        
	
          
            Telephone: (____)
          

        	
          
             
          

        	
          
             
          

        	
          
            Telephone: (____)
          

        	
          
             
          

        	
          
             
          

        
	
          
            Facsimile: (_____)
          

        	
          
             
          

        	
          
             
          

        	
          
            Facsimile: (_____)
          

        	
          
             
          

        	
          
             
          

        
	
          
            Federal ID No.
          

        	
          
             
          

        	
          
             
          

        	
          
            Federal Id:
          

        	
          
             
          

        	
          
             
          

        
														

 

    
      These forms are often modified to
      meet changing requirements of law and needs of the Industry. Always write or
      call to make sure you are utilizing the most current form: AIR COMMERCIAL REAL
      ESTATE ASSOCIATION, 700 South Flower Street, Suite 600, Los Angeles, CA 90017.
      (213) 687-8777.
    

    
      (c)Copyright 1998 By AIR Commercial
      Real Estate Association.
    

    
      All rights
      reserved.
    

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

    
       
    

    	
          
            

            
          

        	
          
            PAGE 17 OF
            17
          

        	
          
            

          

        
	
          
            INITIALS
          

        	
          
             
          

        	
          
            INITIALS
          

        

    
       
    

    	
          
            ©1998 - AIR COMMERCIAL
            REAL ESTATE ASSOCIATION
          

        	
          
            FORM
            MTG-3-12/04E
          

        

    
       
    

    

    
    

    
    
       
    

    
       
    

    
      ADDENDUM TO LEASE
    

    
      THIS ADDENDUM TO LEASE is dated November 9, 2004, by and
      between THE SCHOFIELD FAMILY TRUST, (“Lessor”), and TAG ENTERTAINMENT,
      INC., A CALIFORNIA CORPORATION, (“Lessee”)
      for the Premises commonly known as 9615 Canoga Avenue, Chatsworth, CA 91311
      (“Premises”).
    

    
      This Addendum is attached to, and made a part of, the
      above referenced Standard Industrial/Commercial Multi-Tenant Lease-Gross
      (together with this Addendum, the “Lease”). The provisions of this
      Addendum shall govern and supersede any, and all, contrary or inconsistent
      provisions of the preprinted portion of the Lease.
    

    	
          
            50.
          

        	
          
            RENTAL ADJUSTMENTS: The
            Monthly Rent shall be increased as follows:
          

        

    
      On August 1, 2005 to $8,500.00.
    

    
      On August 1, 2006 to $9,000.00.
    

    
      51.      WAIVER OF CERTAIN CLAIMS: Lessee, to the
      extent permitted by law, waives all claims it may have against Lessor, and
      against Lessor’s agents and employees, for any damages sustained by Lessee
      or by any occupant of the Leased Premises, or by any other person, resulting
      from any cause arising at any time, except for those claims arising from
      Lessor’s gross negligence or willful misconduct. Lessee agrees to hold
      Lessor harmless and indemnified against claims and liability for injuries to
      all persons and for damages to or loss of property occurring in or about the
      Leased Premises or the Building, due to Lessee’s breach of this Lease or
      any act of negligence or default under the Lease by Lessee, its contractors,
      agents, employees, licensees and invitees, except for those claims arising from
      Lessor’s gross negligence or willful misconduct.
    

    
      52.     COMMON AREA EXPENSES: Lessor and Lessee
      acknowledge that the Premises are equal to sixteen and one tenth (16.10%)
      percent of the entire building of which the Premises are a part. Lessee’s
      share of any such expenses is included in the Monthly Rent.
    

    
      Notwithstanding anything contained herein to the
      contrary, Lessee shall still
      be responsible for its full pro-rata share of any deductible portion of (1) an
      insured loss (Paragraph 4.2(a)(viii); (2) an increase in Real Property Tax
      (Paragraph 4.2(a)(v); (3) any Insurance Cost Increase (Paragraph 4.2(a)(vi),
      with no “base year”.
    

    
      53.      CONDITION OF PREMISES: Lessor, at its sole
      cost and expense, using building standard materials, shall perform the
      following, using building standard materials, as soon as reasonably
      possible:
    

    
      A. Repair damaged dry wall warehouse walls;
    

    
      B. Repair/replace as necessary two (2) steel personnel
      doors;
    

    
      C. Broom clean entire premises.
    

    
      54.      FIRE EXTINGUISHERS: Lessee shall install
      upon the Premises, and maintain on a regular basis, #10 ABC multi-purpose dry
      chemical fire extinguisher to meet the requirements set by the Los Angeles City
      Fire Department.
    

    
      55.     ROOF LEAKS: Lessee hereby acknowledges that
      Lessor is not the insurer of Lessee’s property and that any damage to
      Lessee’s property from roof leaks shall be the responsibility of
      Lessee.
    

    
       
    

    
      	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          
	
            
              
 

            

          	
            
               
            

          	
            
              
 

            

          
	
            
              Lessee’s Initials
            

          	
            
               
            

          	
            
              Lessor’s Initials
            

          

 
 
 

    
       
    

    
      1 of 3
    

    
       
    

    

    
    

    
    
      56.       SECURITY MEASURES: Lessee hereby
      acknowledges that Lessor has no obligation to provide guard services or other
      security services or take any type of security measures with respect to the
      Premises, and Lessee acknowledges that Lessor shall not be responsible for any
      loss, injury or damage arising from Lessor’s failure to provide the same.
      Lessee assumes all responsibility for the protection of itself, its employees,
      its property, and its agents and invitees from the acts of third parties, and
      waives all claims against Lessor and agrees to hold the Lessor free and
      harmless from any liability with respect to loss, damage, or theft to property
      or injury to persons resulting from the acts of third parties.
    

    
      57.       OUTSIDE STORAGE: All common areas, including
      but not limited to parking areas and fire walkways, shall not be used for
      storage, assembly, painting, manufacturing, detailing of vehicles or any other
      work of any kind by Lessee or Lessee’s employees, agents and/or invitees.
      There shall be no storage of vehicles, trailers, motor homes or any such items
      at any time, nor shall Lessee erect any form of storage area (fence) on the
      exterior of the Premises at any time.
    

    
      58.       RIGHT TO TRANSFER PREMIUMS: In the event of
      any assignment or sublease approved by Lessor, prior to which Lessee shall have
      made a full and complete disclosure to Lessor of all of the terms and
      conditions of the assignment and/or sublease, and Lessee shall have furnished
      to Lessor true and complete copies of all documents used, and to be used in
      connection with the transaction, Lessee shall pay to Lessor, as additional
      rent, fifty (50%) percent of the “transfer premium” on such
      transaction. The “transfer premium” means (A) all amounts paid to
      Lessee for such assignment or sublease, including “key” money,
      monthly rent in excess of the monthly rent payable under the Lease, and all
      fees and other consideration paid for the assignment or sublease, including
      fees under any collateral agreements, less (B) cost and expenses directly
      incurred by Lessee in connection with the execution and performance of such
      assignment or sublease such as for real estate broker’s commissions,
      advertising or costs of renovation or construction of tenant improvements
      required under such assignment or sublease. Lessee is entitled to recover such
      reasonable costs and expenses before Lessee is obligated to pay the
      Lessor’s share to Lessor. The “transfer premium” in the case of
      a sublease of less than all the Premises is the amount allocable to the
      subleased space as a percentage of the entire Premises on a square foot
      basis.
    

    
      59.     INSURANCE: Notwithstanding anything
      contained in Paragraph 8.3 (c) to the contrary, it is clearly understood
      between Lessor and Lessee that in addition to Lessee being responsible for any
      increase in the insurance on the Building of which the Premises are a part due
      to Lessee’s use and/or occupancy of the Premises, should Lessee’s use
      and/or occupancy of the Premises be the direct cause for the cost(‘s) of
      insurance(‘s) carried by other Tenant’s of the Building, of which the
      Premises are a part, to increase over their “base year amounts” (that
      period of time prior to Lessee’s occupancy), Lessee shall also be
      responsible to each so affected tenant to pay for the increased insurance
      cost(‘s).
    

    
      60.      EARLY POSSESSION: Upon the complete
      execution of this Lease by all Parties, the prior Tenant vacating the Premises,
      Lessee paying Lessor all monies due upon Lease execution, the substantial
      completion of Lessor’s work, and Lessee providing Lessor with adequate
      liability insurance coverage, Lessee shall be provided possession of the
      Premises to ready it for its occupancy, and said early possession shall be free
      of rent but subject to all other terms and considerations of this Lease.
    

    
      61.       PHYSICAL INSPECTION:  Delphi Business
      Properties, Inc. and/or Lessor are not aware of any physical defects or
      deficiencies in the Premises which have not already been disclosed to Lessee.
      Lessee should conduct an independent physical inspection of the Premises,
      including electrical systems and amperage, at Lessee’s sole cost an
      expense prior to Lease execution. If Lessee shall fail to conduct such an
      inspection, then Lessee shall hold Lessor and Broker harmless for any defects,
      deficiencies, damage or costs to repair such items, (not covered by Lease
      warranties) which may result from Lessee’s failure to conduct said
      physical inspection. Lessee shall indemnify Lessor and Broker from any
      liability in connection with Lessee’s failure to physically inspect the
      Premises, and shall pay Lessor’s and Broker’s reasonable costs,
      including attorney fees from any resultant court action. Lessee’s initials
      below shall witness Lessee’s acknowledgment of the Provision.
    

    
      Lessee’s Initials ___________________
    

    
       
    

    
      	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          
	
            
              
 

            

          	
            
               
            

          	
            
              
 

            

          
	
            
              Lessee’s Initials
            

          	
            
               
            

          	
            
              Lessor’s Initials
            

          

 
 
 

    
       
    

    
      2 of 3
    

    
       
    

    

    
    

    
    
      62.     ANIMALS: Lessee shall not permit any animals
      or pets on or about the Premises without the prior written consent of Lessor.
      Lessor and Lessee agree that it shall be reasonable for Lessor to withhold its
      consent to any such request for an animal to be kept upon the Premises
    

    
      63.     DAMAGE AND REPAIR: Notwithstanding Paragraph 9.2 and 9.3 to the contrary, Lessor shall be
      responsible to repair the damage only to those items specified in Paragraph 7.2
      to be maintained and repaired by Lessor, as well as interior improvements
      existing as of the Commencement Date or the date of early possession (whichever
      is earlier), and Lessee shall at its sole cost and expense repair all other
      improvements within the Premises installed after the date of early possession
      or Commencement Date, whichever is earlier.
    

    
      64.     NONWAIVER:
      Lessor’s acceptance of partial rent payments shall not constitute a waiver
      of any of Lessor’s rights available under this Lease or at law or equity,
      including, without limitation, the right to recover possession of the
      Premises.
    

    
      65.     LIMITATION OF LESSOR’S
      LIABILITY: The obligations of Lessor under this Lease
      do not constitute personal obligations of the individual partners,
      shareholders, directors, officers, managers, members, employees or agents of
      Lessor, and Lessee shall look solely to Lessor’s interest in the building
      and Land and to no other assets of Lessor for satisfaction of any liability in
      respect of this Lease. Lessee will not seek recourse against the individual
      partners, shareholders, directors, officers, managers, members, employees or
      agents of Lessor, or any of their personal assets for such satisfaction.
      Notwithstanding any other provisions contained herein, Lessor shall not be
      liable to Lessee, its contractors, agents, invitees or employees for any
      consequential damages or damages for loss of profits.
    

    
      66.
          LESSOR’S REMEDIES: In
      addition to any other remedies of Lessor contained in this Lease under the
      provisions of Paragraph 13.2 hereof, the Lessor gives notice that additional
      remedies are available under California Law (Civil Code Section 1951.2) and its
      future amendments or revisions. These Code Sections require Lessor to declare
      to Lessee in the Lease that Lessor will avail itself of the remedies so
      proscribed. Lessor hereby gives said notice.
    

    
      67.     PERSONAL GUARANTEE:
      Attached hereto and made a part hereof by reference.
    

    
      68.     CONDITION PRECEDENT:
      This Lease is strictly conditioned upon Lessor and the existing Tenant entering
      into a Lease Termination Agreement in a form acceptable to Lessor.
    

    
      This Addendum to Lease is executed as of the date first
      written above.
    

    
       
    

    
      	
            
               
            

          	
            
               
            

          	
            
              LESSEE:
            

          	
            
              TAG ENTERTAINMENT, INC. 

              A CALIFORNIA CORPORATION
            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              By: 
            

          	
            
              
 

            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              Steve Austin
 President
            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              By: 
            

          	
            
              
 

            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              Name ________________________

              Secretary
            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              LESSOR:
            

          	
            
              THE SCHOFIELD FAMILY TRUST
            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              By: 
            

          	
            
              
 

            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              Miles Schofield 
 Trustee
            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              By: 
            

          	
            
              
 

            

          
	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
               
            

          	
            
              Anne Schofield
 Trustee
            

          

 

    
       
    

    
      3 of 3

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