Document:

Agreement and Plan of Merger

 Exhibit 10.1 
  

 AGREEMENT AND PLAN OF MERGER 
 Dated as of September 20, 2007 
 among 
 SUSSER HOLDINGS CORPORATION, 
 TCFS
ACQUISITION CORPORATION, 
 TCFS HOLDINGS, INC. 
 and 
 DAVID LLOYD NORRIS, 
 as the Shareholder Representative 
 and 
 DEVIN LEE BATES, JAMES RANDAL BROOKS, 
 WYLIE ALVIN NEW and DAVID LLOYD NORRIS 
  

 TABLE OF CONTENTS 
  

					
	 	 	 	  	Page
	ARTICLE I	 	DEFINITIONS	  	1
			
	 Section 1.1
	 	 Definitions
	  	1
			
	 Section 1.2
	 	 Terms Defined Elsewhere in this Agreement
	  	9
			
	 Section 1.3
	 	 Other Definitional and Interpretive Matters
	  	11
			
	ARTICLE II	 	THE MERGER	  	12
			
	 Section 2.1
	 	 Closing and Effective Date of Merger
	  	12
			
	 Section 2.2
	 	 Terms and Conditions of Merger
	  	12
			
	 Section 2.3
	 	 Calculation of Per Share Closing Purchase Price
	  	14
			
	 Section 2.4
	 	 Payment for Stock; Payment of Debt Payoff Amount; Procedures
	  	14
			
	 Section 2.5
	 	 Escrow
	  	16
			
	 Section 2.6
	 	 Dissenting Shares
	  	17
			
	 Section 2.7
	 	 No Further Transfers
	  	18
			
	 Section 2.8
	 	 Termination of Rights
	  	18
			
	 Section 2.9
	 	 No Liability
	  	18
			
	 Section 2.10
	 	 Appointment of Shareholder Representative
	  	18
			
	 Section 2.11
	 	 Withholding Rights
	  	20
			
	ARTICLE III	 	REPRESENTATIONS AND WARRANTIES OF THE MAJOR SHAREHOLDERS	  	20
			
	 Section 3.1
	 	 Execution and Delivery of Agreement and Major Shareholder Documents
	  	20
			
	 Section 3.2
	 	 Conflicts; Consents of Third Parties
	  	21
			
	 Section 3.3
	 	 Ownership
	  	21
			
	 Section 3.4
	 	 Financial Advisors
	  	21
			
	ARTICLE IV	 	REPRESENTATIONS AND WARRANTIES OF COMPANY	  	22
			
	 Section 4.1
	 	 Organization; Good Standing
	  	22
			
	 Section 4.2
	 	 Authorization of Agreement
	  	22
			
	 Section 4.3
	 	 Conflicts; Consents of Third Parties
	  	23
			
	 Section 4.4
	 	 Capitalization
	  	23
			
	 Section 4.5
	 	 Subsidiaries
	  	24

  

 i 

 TABLE OF CONTENTS 
 (continued) 
  

					
	 	 	 	  	Page
			
	 Section 4.6
	 	 Corporate Records
	  	25
			
	 Section 4.7
	 	 Financial Statements and Related Matters
	  	25
			
	 Section 4.8
	 	 No Undisclosed Liabilities
	  	26
			
	 Section 4.9
	 	 Absence of Certain Developments
	  	26
			
	 Section 4.10
	 	 Taxes
	  	26
			
	 Section 4.11
	 	 Real Property
	  	28
			
	 Section 4.12
	 	 Tangible Personal Property
	  	29
			
	 Section 4.13
	 	 Intellectual Property
	  	30
			
	 Section 4.14
	 	 Material Contracts
	  	30
			
	 Section 4.15
	 	 Employee Benefits Plans
	  	32
			
	 Section 4.16
	 	 Labor
	  	34
			
	 Section 4.17
	 	 Litigation
	  	35
			
	 Section 4.18
	 	 Compliance with Laws; Permits
	  	35
			
	 Section 4.19
	 	 Environmental Matters
	  	35
			
	 Section 4.20
	 	 Insurance
	  	37
			
	 Section 4.21
	 	 Related Party Transactions
	  	37
			
	 Section 4.22
	 	 Banks; Power of Attorney
	  	38
			
	 Section 4.23
	 	 Issuances and Repurchases of Securities
	  	38
			
	 Section 4.24
	 	 Full Disclosure
	  	38
			
	 Section 4.25
	 	 Financial Advisors
	  	38
			
	 Section 4.26
	 	 Opinion of Financial Advisor
	  	38
			
	ARTICLE V	 	REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB	  	38
			
	 Section 5.1
	 	 Organization and Good Standing
	  	38
			
	 Section 5.2
	 	 Authorization of Agreement
	  	39
			
	 Section 5.3
	 	 Conflicts; Consents of Third Parties
	  	39
			
	 Section 5.4
	 	 Financial Advisors
	  	40
			
	ARTICLE VI	 	REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDER REPRESENTATIVE	  	40

  

 ii 

 TABLE OF CONTENTS 
 (continued) 
  

					
	 	 	 	  	Page
			
	 Section 6.1
	 	 Due Execution; Binding Effect
	  	40
			
	 Section 6.2
	 	 Non-Contravention
	  	40
			
	ARTICLE VII	 	CONDUCT OF BUSINESS PRIOR TO EFFECTIVE TIME	  	40
			
	 Section 7.1
	 	 Access to Information; Confidentiality
	  	40
			
	 Section 7.2
	 	 Conduct of the Business Pending the Closing
	  	41
			
	 Section 7.3
	 	 Third Party Consents
	  	43
			
	 Section 7.4
	 	 Governmental Consents and Approvals
	  	44
			
	 Section 7.5
	 	 No Solicitation; Superior Offer
	  	45
			
	 Section 7.6
	 	 Further Assurances
	  	46
			
	 Section 7.7
	 	 Publicity
	  	47
			
	 Section 7.8
	 	 Cooperation with Financing
	  	47
			
	 Section 7.9
	 	 Monthly Financial Statements
	  	48
			
	 Section 7.10
	 	 Notification of Certain Matters
	  	48
			
	 Section 7.11
	 	 Notice of Merger and Appraisal Rights
	  	48
			
	ARTICLE VIII	 	MUTUAL CONDITIONS PRECEDENT TO PARTIES’ OBLIGATIONS	  	49
			
	 Section 8.1
	 	 No Injunction
	  	49
			
	 Section 8.2
	 	 HSR
	  	49
			
	ARTICLE IX	 	CONDITIONS PRECEDENT TO PARENT’S AND MERGER SUB’S OBLIGATIONS	  	49
			
	 Section 9.1
	 	 Accuracy of Representations and Warranties by Company
	  	49
			
	 Section 9.2
	 	 Compliance by Company
	  	49
			
	 Section 9.3
	 	 No Material Adverse Change
	  	49
			
	 Section 9.4
	 	 Officers’ Closing Certificate
	  	50
			
	 Section 9.5
	 	 Approvals
	  	50
			
	 Section 9.6
	 	 Consents
	  	50
			
	 Section 9.7
	 	 Delivery of Articles of Merger
	  	50
			
	 Section 9.8
	 	 Delivery of Escrow Agreement
	  	50
			
	 Section 9.9
	 	 Delivery of Cash Exchange Agreement
	  	50

  

 iii 

 TABLE OF CONTENTS 
 (continued) 
  

					
	 	 	 	  	Page
			
	 Section 9.10
	 	 Pay-Off Letters
	  	50
			
	 Section 9.11
	 	 Delivery of Secretary’s Certificate
	  	50
			
	 Section 9.12
	 	 Financing
	  	51
			
	 Section 9.13
	 	 FIRPTA
	  	51
			
	ARTICLE X	 	CONDITIONS PRECEDENT TO COMPANY’S OBLIGATIONS	  	51
			
	 Section 10.1
	 	 Accuracy of Representations and Warranties by Parent and Merger Sub
	  	51
			
	 Section 10.2
	 	 Compliance by Parent and Merger Sub
	  	51
			
	 Section 10.3
	 	 Officers’ Closing Certificate
	  	51
			
	 Section 10.4
	 	 Approvals
	  	51
			
	 Section 10.5
	 	 Articles of Merger
	  	51
			
	 Section 10.6
	 	 Delivery of Escrow Agreement
	  	51
			
	 Section 10.7
	 	 Delivery of Cash Exchange Agreement
	  	52
			
	ARTICLE XI	 	POST-CLOSING COVENANTS OF THE SURVIVING CORPORATION	  	52
			
	 Section 11.1
	 	 Severance
	  	52
			
	 Section 11.2
	 	 Employee Vacation and Benefits following Closing
	  	52
			
	 Section 11.3
	 	 Directors’ and Officers’ Indemnification and Insurance
	  	53
			
	 Section 11.4
	 	 Preservation of Records
	  	54
			
	 Section 11.5
	 	 Use of Name
	  	54
			
	ARTICLE XII	 	CLAIMS AGAINST INDEMNIFICATION ESCROW FUND	  	55
			
	 Section 12.1
	 	 Applicability
	  	55
			
	 Section 12.2
	 	 Survival of Representations and Warranties
	  	55
			
	 Section 12.3
	 	 Indemnification
	  	55
			
	 Section 12.4
	 	 Indemnification Procedures
	  	57
			
	 Section 12.5
	 	 Limitations on Indemnification for Certain Losses
	  	59
			
	 Section 12.6
	 	 Indemnity Escrow; Exclusivity of Escrow
	  	60
			
	 Section 12.7
	 	 Tax Matters
	  	60
			
	 Section 12.8
	 	 Tax Treatment of Indemnity Payments
	  	62

  

 iv 

 TABLE OF CONTENTS 
 (continued) 
  

					
	 	 	 	  	Page
			
	 Section 12.9
	 	 Exclusive Remedy
	  	62
			
	ARTICLE XIII	 	TERMINATION; LIABILITIES CONSEQUENT THEREON	  	62
			
	 Section 13.1
	 	 Termination
	  	62
			
	 Section 13.2
	 	 Procedure Upon Termination
	  	63
			
	 Section 13.3
	 	 Effect of Termination
	  	63
			
	ARTICLE XIV	 	MISCELLANEOUS PROVISIONS	  	64
			
	 Section 14.1
	 	 Expenses
	  	64
			
	 Section 14.2
	 	 Specific Performance
	  	64
			
	 Section 14.3
	 	 Entire Agreement; Waivers; Amendments
	  	64
			
	 Section 14.4
	 	 Notices
	  	65
			
	 Section 14.5
	 	 Binding Effect; Assignment
	  	66
			
	 Section 14.6
	 	 Severability
	  	66
			
	 Section 14.7
	 	 Governing Law
	  	67
			
	 Section 14.8
	 	 Jurisdiction and Venue
	  	67
			
	 Section 14.9
	 	 Non-Recourse
	  	67
			
	 Section 14.10
	 	 Company Disclosure Schedule; Supplemental Disclosures
	  	68
			
	 Section 14.11
	 	 Counterparts
	  	68

  

 v 

 LIST OF EXHIBITS 
  

			
	Exhibit A	  	Transition and Noncompetition Agreement
	Exhibit B	  	Articles of Merger
	Exhibit C	  	Articles of Incorporation
	Exhibit D	  	Bylaws
	Exhibit E	  	Escrow Agreement

  

 vi 

 AGREEMENT AND PLAN OF MERGER 
 This AGREEMENT AND PLAN OF MERGER, dated as of September 20, 2007 (this “Agreement”), is among Susser Holdings Corporation, a
Delaware corporation (“Parent”), TCFS Acquisition Corporation, a Texas corporation and an indirect wholly-owned subsidiary of Parent (“Merger Sub”), TCFS Holdings, Inc., a Texas corporation
(“Company”), David Lloyd Norris (the “Shareholder Representative”) and Devin Lee Bates, James Randal Brooks, Wylie Alvin New and David Lloyd Norris (the “Major Shareholders”). 
 WHEREAS, Company has an authorized capital of 10,000,000 shares of Common Stock, par value $0.01 per share (“Company Common Stock”), of
which 4,537,490 shares are issued and outstanding as of the date hereof; 
 WHEREAS, Merger Sub has an authorized capital of 100 shares of
common stock, par value $0.01 per share, all of which shares are issued and outstanding and held by Parent; 
 WHEREAS, the Board of
Directors of Company has received the opinion of Houlihan, Lokey, Howard & Zukin Financial Advisors, Inc. (“Houlihan Lokey”) as to the fairness to the Company Shareholders from a financial point of view of the Merger (as
defined below); 
 WHEREAS, the Boards of Directors of each of Parent, Merger Sub, and Company believe that the merger of Merger Sub with and
into Company would be advantageous and beneficial to their respective corporations and shareholders; 
 WHEREAS, prior to the execution and
delivery of this Agreement, the requisite shareholders of Merger Sub and Company have, through a written consent, validly approved this Agreement and the transactions contemplated hereby; 
 WHEREAS, concurrently with the execution and delivery of this Agreement, each of the Major Shareholders shall have entered into a Transition and
Noncompetition Agreement with Parent and Company to be effective upon the consummation of the transactions contemplated by this Agreement, substantially in the form of Exhibit A; and 
 WHEREAS, pursuant to the terms of this Agreement, Merger Sub shall be merged with and into Company and Company shall be the surviving entity (the
“Merger”). 
 NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth, and intending
to be legally bound hereby, the parties hereto agree as follows: 
 ARTICLE I 
 DEFINITIONS 
 Section 1.1 Definitions. As used herein the following terms
not otherwise defined have the following respective meanings: 

 “Acquisition Proposal” means any agreement, offer or proposal, including any proposal to
Company’s shareholders, relating to or involving (i) any direct or indirect acquisition or purchase from Company or its Subsidiaries or any acquisition by any Person or group of more than a 30% interest in the total issued and outstanding
Company Common Stock or any tender offer or exchange offer, recapitalization, share exchange or reorganization that if consummated would result in any Person or group beneficially owning 30% or more of the total issued and outstanding Company Common
Stock, (ii) any merger, consolidation, business combination or similar transaction involving Company or its Subsidiaries, or (iii) any sale or disposition of 30% or more of the consolidated assets of Company and its Subsidiaries in any
single transaction or series of related transactions (other than in the ordinary course of business and other than dispositions pursuant to sale-leaseback arrangements or similar financing arrangements); provided, however, the term Acquisition
Proposal does not include (x) this Agreement, (y) the merger contemplated hereby, or (z) any other offer or proposal by Parent to acquire the businesses and operations contemplated by this Agreement. 
 “Affiliate” means, with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such Person, and the term “control” (including the terms “controlled by” and “under common control with”) means the possession,
directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities, by contract or otherwise. 
 “Alcohol Filings” means any application, consent or filing required to be submitted to the Texas Alcohol and Beverage Commission or the
New Mexico Regulation and Licensing Department, Alcohol and Gaming Division in order to maintain a license to sell alcohol. 
 “Book
Value of Undeveloped Land” means the book value of the undeveloped land as recorded in Company’s most recent balance sheet prepared prior to the Closing, which shall be prepared in accordance with GAAP applied consistently with the
application thereof used in the preparation of each of the balance sheets included in the Financial Statements (provided that such amounts will be included in this definition only to the extent not in excess of 5% the estimated amounts set forth on
Schedule 1.1 or, if in excess of 5% of such amounts, only to the extent the purchase of such undeveloped land has been consented to in writing by Parent, such consent not to be unreasonably withheld). 
 “Business Day” means any day other than a Saturday, Sunday or a day in which either the Federal Reserve Bank of Dallas, Texas or New
York, New York is closed. 
 “Capital Expenditure for New/Raze & Rebuild Stores” means the sum of (i) the
amount of the funded cash capital expenditures spent by Company following June 2, 2006 and prior to the Closing Date for new stores, raze and rebuilding of existing stores, and acquisitions of existing stores, which amount shall be determined
consistently with the manner in which Company has determined the amount of such funded cash capital expenditures as set forth on Schedule 1.2 (provided that such amounts will be included in this clause (i) only to the extent not in
excess of 5% of the estimated amounts set forth on Schedule 1.2 or, if in excess of 5% of such amounts, only to the extent such funded cash expenditures have been consented to in writing by Parent, such consent not to be unreasonably
withheld). 
  

 2 

 “Certificates” means the stock certificates which, immediately prior to the Effective
Time, represented shares of Company Common Stock other than Dissenting Shares. 
 “Code” means the Internal Revenue Code of
1986, as amended. 
 “Company Shareholder” means any holder of record of shares of Company Common Stock outstanding
immediately prior to the Effective Time; provided, however, that the term “Company Shareholder” shall not include any holder of Dissenting Shares. 
 “Company Termination Fee” means the greater of (i) $7,500,000 or (ii) 80% of the amount by which the consideration provided for in an applicable Superior Offer exceeds the aggregate
consideration to shareholders of Company pursuant to this Agreement. To the extent the applicable Superior Proposal provides for purchase of less than 100% of Company, such aggregate consideration for purposes of this definition shall be increased
such that it will represent the consideration amount implied by such Superior Offer if such Superior Offer were to contemplate the purchase of 100% of Company. 
 “Company Transaction Expenses” means, except as otherwise expressly set forth in this Agreement, the aggregate amount of all out-of-pocket costs, fees and expenses, incurred by or at the direction of,
or paid or required to be paid by, Company or any of its Subsidiaries in connection with the process of selling Company or otherwise relating to the negotiation, preparation or execution of this Agreement or any documents or agreements contemplated
hereby or the performance or consummation of the transactions contemplated hereby, including (A) any fees associated with filings required by the HSR Act, (B) any fees and expenses associated with obtaining necessary or appropriate
waivers, consents or approvals of any Governmental Entity or third parties on behalf of Company or any of its Subsidiaries, (C) any fees or expenses associated with obtaining the release and termination of any Encumbrances; (D) all
brokers’ or finders’ fees; and (E) fees and expenses of counsel, advisors, consultants, investment bankers, accountants, and auditors and experts. 
 “Contract” means any contract, agreement, indenture, note, bond, mortgage, loan, lease, license, commitment or other legally binding commitment or obligation, whether written or oral. 
 “Debt Payoff Amount” means the amount of all outstanding Indebtedness of Company for borrowed money under the facilities set forth or
required to be set forth in Schedule 4.7(d)(i) of the Company Disclosure Schedule. 
 “Electronic Data Room”
means the proprietary extranet(s) or other internet-based network(s), as the same existed as of the date of this Agreement, providing for an online repository of data and information related to Company. 
 “Employees” means any current or former employees of Company or any of the Subsidiaries. 
 “Encumbrance” means any lien, pledge, mortgage, deed of trust, security interest, claim, lease, charge, option, right of first refusal,
easement, proxy, voting trust or agreement, transfer 

  

 3 

 
restriction under any shareholder or similar agreement, encumbrance or any other restriction or limitation whatsoever. 
 “Environmental Costs and Liabilities” means, with respect to any Person, all liabilities, obligations, responsibilities, Remedial
Actions, losses, damages (including punitive damages and consequential damages) reasonable costs and expenses (including all reasonable fees, disbursements and expenses of counsel, experts and consultants and costs of investigation and feasibility
studies), fines, penalties, sanctions and interest incurred as a result of any claim or demand by any other Person or in response to any violation of Environmental Law, whether known or unknown, accrued or contingent, whether based in contract,
tort, implied or express warranty, strict liability, criminal or civil statute or otherwise, to the extent based upon, related to, or arising under or pursuant to any Environmental Law, Environmental Permit, Order arising under Environmental Law or
agreement with any Governmental Entity or other Person, which relates to Environmental Law. 
 “Environmental Law” means any
Law relating to the protection of human health and safety, the environment, natural resources or underground or above ground storage tanks, including, but not limited to, the Comprehensive Environmental Response, Compensation and Liability Act (42
U.S.C. § 9601 et seq.), the Hazardous Materials Transportation Act (49 U.S.C. App. § 1801 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Clean Water Act (33
U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.) the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C.
§ 136 et seq.), and the Occupational Safety and Health Act (29 U.S.C. § 651 et seq.), as each has been or may be amended and the regulations promulgated pursuant thereto, and any regulations or requirements of the
Texas Commission on Environmental Quality with respect to properties in Texas, including those at 30 Texas Administrative Code, Chapter 334, and the New Mexico Environmental Department, Petroleum Storage Tank Bureau, including those at 20 New Mexico
Annotated Code, Chapter 5. 
 “Environmental Permit” means any Permit required by Environmental Laws for the operation of
Company and its Subsidiaries. 
 “ERISA” means the Employment Retirement Income Security Act of 1974, as amended.

 “For Cause” means: 
  

	 	(a)	Measurable, documented facts of work related conduct and/or performance that have an adverse effect on Company’s or Surviving Corporation’s image or reputation;

  

	 	(b)	Excessive absenteeism or tardiness; 

  

	 	(c)	Gross insubordination, immoral or indecent behavior at work; 

  

	 	(d)	Security violations; 

  

	 	(e)	Dishonesty and theft; 

  

 4 

	 	(f)	Fighting or sleeping on the job; 

  

	 	(g)	Possession of alcohol or drugs on the job; 

  

	 	(h)	Incompetence; or 

  

	 	(i)	Violation of stated Company policies which merit termination and for which there is a consistent record of discharge for similar violations. 

 “GAAP” means United States generally accepted accounting principles which are consistent with the principles promulgated or adopted by
the Financial Accounting Standards Board and its predecessors, in effect for the applicable fiscal year. 
 “Governmental
Entity” means any government or governmental or regulatory body thereof, or political subdivision thereof, whether federal, state, local or foreign, or any agency, instrumentality or authority thereof, or any court or arbitrator (public or
private). 
 “Hazardous Material” means any substance, material or waste that is regulated, classified, or otherwise
characterized under or pursuant to any Environmental Law as “hazardous,” “toxic,” “pollutant,” “contaminant,” or “radioactive,” including petroleum and its
by-products, asbestos, polychlorinated biphenyls, radon and urea formaldehyde insulation. 
 “Indebtedness” of any Person
means, without duplication, (i) the principal, accreted value, accrued and unpaid interest, prepayment and redemption premiums or penalties (if any), unpaid fees or expenses and other monetary obligations in respect of (A) indebtedness of
such Person for money borrowed and (B) indebtedness evidenced by notes, debentures, bonds or other similar instruments for the payment of which such Person is responsible or liable; (ii) all obligations of such Person issued or assumed as
the deferred purchase price of property, all conditional sale obligations of such Person and all obligations of such Person under any title retention agreement (but excluding trade accounts payable and other accrued current liabilities arising in
the Ordinary Course of Business (other than the current liability portion of any indebtedness for borrowed money)); (iii) all obligations of such Person under leases required to be capitalized in accordance with GAAP; (iv) all obligations
of such Person for the reimbursement of any obligor on any letter of credit, banker’s acceptance or similar credit transaction; (v) all obligations of such Person under interest rate or currency swap transactions (valued at the termination
value thereof); (vi) the liquidation value, accrued and unpaid dividends, prepayment or redemption premiums and penalties (if any), unpaid fees or expenses and other monetary obligations in respect of any redeemable preferred stock of such
Person; (vii) all obligations of the type referred to in clauses (i) through (vi) of any Persons for the payment of which such Person is responsible or liable, directly or indirectly, as obligor, guarantor, surety or otherwise,
including guarantees of such obligations; and (viii) all obligations of the type referred to in clauses (i) through (vii) of other Persons secured by (or for which the holder of such obligations has an existing right, contingent or
otherwise, to be secured by) any Encumbrance on any property or asset of such Person (whether or not such obligation is assumed by such Person). 
  

 5 

 “Intellectual Property” means all: (i) patents and patent applications,
registrations and disclosures and all related continuations, divisionals, continuations-in-part, reissues, reexaminations, utility models, certificates of invention and design patents, and all improvements thereon, (ii) trademarks, service
marks, trade dress, logos, corporate names, trade names and Internet domain names, together with the goodwill associated with any of the foregoing, and all applications and registrations therefor, (iii) copyrights and registrations and
applications therefor, works of authorship and moral rights, (iv) confidential and proprietary information, including trade secrets, discoveries, concepts, ideas, research and development, financial, marketing and business data, pricing and
cost information, business and marketing plans, algorithms, know-how, formulae, inventions (whether or not patentable), processes, techniques, technical data, designs, drawings, specifications, databases, and customer and supplier lists and
information, in each case excluding any rights in respect of any of the items described in this clause (iv) that comprise or are protected by patents and (v) Software. 
 “IRS” means the Internal Revenue Service. 
 “Knowledge” means, (i) with respect to Company, the actual knowledge of Devin Lee Bates, James Randal Brooks, Wylie Alvin New and David Lloyd Norris, (ii) with respect to Parent, the actual
knowledge of Sam L. Susser, E.V. Bonner, Jr., Roger D. Smith, Rocky B. Dewbre, Mary E. Sullivan or Ronald D. Coben, (iii) with respect to any other Person that is not an individual, the actual knowledge of such
Person’s directors and executive officers and any other manager having primary responsibility relating to the applicable matter or (iv) in the case of an individual, the actual knowledge of such individual. 
 “Law” means any foreign, federal, state or local law (including common law), statute, code, ordinance, rule, regulation, Order or other
requirement. 
 “Legal Proceeding” means any judicial, administrative or arbitral action, suit, mediation, investigation,
inquiry, proceeding or claim (including any counterclaim) by or before a Governmental Entity. 
 “Liability” means any debt,
loss, damage, adverse claim, fines, penalties, liability or obligation (whether direct or indirect, known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued, matured or unmatured, determined or determinable, liquidated
or unliquidated, or due or to become due, and whether in contract, tort, strict liability or otherwise), and including all costs and expenses relating thereto including all fees, disbursements and expenses of legal counsel, experts, engineers and
consultants and costs of investigation. 
 “Lottery Filings” means any application, consent or filing required to be
submitted to the Texas Lottery Commission or the New Mexico Lottery Authority in order to maintain a license to sell lottery or “scratch-off” tickets. 
 “Material Adverse Effect” means a material adverse effect on (i) the business, assets, properties, results of operations or financial condition of Company and its Subsidiaries (taken as a whole)
or (ii) the ability of Company to consummate the transactions contemplated by this Agreement, other than an effect resulting from an Excluded Matter. “Excluded Matter” means any one or more of the following, except to the
extent any of the following may reasonably be 

  

 6 

 
expected to impact Company and its Subsidiaries disproportionately as compared to other companies in the same industry: (i) the effect of any change in
the United States or foreign economies or securities or financial markets in general; (ii) the effect of any change arising in connection with earthquakes, hostilities, acts of war, sabotage or terrorism or military actions or any escalation or
material worsening of any such hostilities, acts of war, sabotage or terrorism or military actions existing or underway as of the date hereof; (iii) any effect resulting from any party hereto taking any action contemplated or required by this
Agreement (except that the “Excluded Matters” described in this clause (iii) shall not apply with respect to the consummation of the transactions contemplated by this Agreement in the case of any representation, warranty or
covenant that relates specifically to the consummation of the transactions contemplated by this Agreement) or (iv) any effect resulting from the public announcement of this Agreement or the public announcement of the transactions contemplated
hereby. 
 “Order” means any order, injunction, judgment, doctrine, decree, ruling, writ, assessment or arbitration award of
a Governmental Entity. 
 “Ordinary Course of Business” means the ordinary and usual course of day-to-day operations of the
business of Company and its Subsidiaries through the date hereof consistent with past practice. 
 “Permits” means any
approvals, authorizations, consents, licenses, permits or certificates of a Governmental Entity. 
 “Permitted Encumbrances”
means (i) all defects, exceptions, restrictions, easements, rights of way and Encumbrances disclosed in schedule B of policies of title insurance that have been delivered to Parent (other than liens securing Indebtedness); (ii) customary
and routine minor title defects, exceptions, restrictions, easements, rights of way and other similar encumbrances that would be listed as exceptions on a policy of title insurance, provided such Encumbrances do not and will not adversely affect the
current use of the Owned Property affected thereby or the future continued use thereof and do not constitute liens for the future payment of money or claims for unpaid money; (iii) statutory liens for current Taxes, levies, assessments or other
governmental charges not yet delinquent or the amount or validity of which is being contested in good faith by appropriate proceedings provided an appropriate reserve has been established therefor in the Financial Statements in accordance with GAAP;
(iv) mechanics’, materialmans’, suppliers’, vendors’, carriers’, workers’, and repairers’ Encumbrances arising or incurred in the Ordinary Course of Business that are not material to the business, operations
and financial condition of Company Property so encumbered and that are not resulting from a breach, default or violation by Company or any of its Subsidiaries of any Contract or Law; (v) roadway, highway, zoning, building, entitlement and other
land use and environmental regulations, laws or ordinances relating to the use or occupancy of the Owned Property by any Governmental Entity, provided that such regulations, laws or ordinances are not violated by the current use or occupancy of such
Owned Property; (vi) unrecorded leases, licenses and operating agreements affecting the Owned Property which do not, individually or in the aggregate, materially and adversely affect the current use of the Owned Property by Company or its
Subsidiaries; (vii) worker’s or unemployment compensation liens arising in the Ordinary Course of Business; 

  

 7 

 
(viii) all valid restrictions, easements, rights of way and encumbrances (other than liens securing Indebtedness) granted by Company or any of its
Subsidiaries that affect the Owned Property, or any portion thereof, and which are filed of record in the real property records of the counties where the Owned Property is located and (ix) Encumbrances listed on Schedule 4.11(a) (other
than those noted on Schedule 4.11(a) as being discharged prior to Closing). 
 “Person” means any individual,
corporation, limited liability company, partnership, firm, joint venture, association, joint-stock company, trust, unincorporated organization, Governmental Entity or other entity. 
 “Prepayment Penalties and Debt Defeasance Costs” means all prepayment penalties, debt defeasance costs or other amounts required to be
paid (other than principal and accrued interest) by Company or any of its Subsidiaries in order to extinguish the Debt Payoff Amount in full on the Closing Date and any fees or other payments required for the release (and recording thereof) of any
security interest securing the Debt Payoff Amount. 
 “Release” means, with respect to Hazardous Materials, any release,
spill, emission, leaking, pumping, poring, injection, deposit, dumping, emptying, disposal, discharge, dispersal, leaching or migration into the indoor or outdoor environment, or into or out of any property. 
 “Remedial Action” means all actions including any capital expenditures undertaken to (i) clean up, remove, treat or in any other
way address any Hazardous Material; (ii) prevent the Release or threat of Release, or minimize the further Release of any Hazardous Material so it does not migrate or endanger or threaten to endanger public health or welfare or the indoor or
outdoor environment; (iii) perform pre-remedial studies and investigations or post-remedial monitoring and care; or (iv) to correct a condition of noncompliance with Environmental Laws. 
 “Securities Act” means the Securities Act of 1933, as amended. 
 “Software” means any and all computer programs, whether in source code or object code; databases and compilations, whether machine
readable or otherwise; descriptions, flow-charts and other work product used to design, plan, organize and develop any of the foregoing; and all documentation including user manuals and other training documentation related to any of the foregoing.

 “Storage Tank Filings” means any application, consent or filing required to be submitted to the Texas Commission on
Environmental Quality or the New Mexico Environment Department in order to maintain the oil and gas storage tank registrations of Company. 
 “Subsidiary” means any Person of which (i) a majority of the outstanding share capital, voting securities or other equity interests are owned, directly or indirectly, by Company or (ii) Company is entitled,
directly or indirectly, to appoint a majority of the board of directors, board of managers or comparable body of such Person. 
 “Superior Offer” means, with respect to Company, an unsolicited, bona fide written offer made by a third party for an Acquisition Proposal (except that references to “30%” in clauses (i) and
(iii) of the definition of “Acquisition Proposal” shall be deemed to be a reference to 

  

 8 

 
“50%”) on terms that the Company Board has in good faith concluded (after consultation with its outside legal counsel and its financial
advisor), taking into account, among other things, all legal, financial, regulatory and other aspects of the offer and the Person making the offer, to be more favorable to Company’s shareholders (in their capacities as shareholders) from a
financial point of view than those contemplated by this Agreement (including any proposed alterations to this Agreement submitted in writing by Parent in response thereto) and is reasonably capable of being consummated without undue delay.

 “Taxes” means (i) all federal, state, local or foreign taxes, charges, fees, imposts, levies or other assessments,
including all income, gross receipts, capital, sales, use, ad valorem, value added, transfer, franchise, profits, inventory, capital stock, license, escheat, abandoned/unclaimed property, withholding, payroll, employment, social security,
unemployment, excise, severance, stamp, occupation, property and estimated taxes, customs duties, fees, assessments and charges of any kind whatsoever, (ii) all interest, penalties, fines, additions to tax or additional amounts imposed by any
Taxing Authority in connection with any item described in clause (i) and (iii) any liability in respect of any item described in clause (i) or (ii) payable by reason of contract, assumption, transferee liability, operation of
Law, Treasury Regulation Section 1.1502-6(a) (or any predecessor or successor thereof or any analogous or similar provision of Law) or otherwise. 
 “Taxing Authority” means the IRS and any other Governmental Entity responsible for the administration of any Tax. 
 “Tax Return” means any return, report or statement filed or required to be filed with respect to any Tax (including any elections, declarations and schedules and attachments thereto) including any
information return, claim for refund, amended return or declaration of estimated Tax. 
 “Unamortized Loan Costs” means the
unamortized loan costs that remain on Company’s books for income Tax purposes from debt incurrence by Company in 1999 that, in the reasonable opinion of counsel for Parent, are currently deductible for income Tax purposes. 
 Section 1.2 Terms Defined Elsewhere in this Agreement. For purposes of this Agreement, the following terms have meanings set forth in the
sections indicated: 
  

			
	 Term
	  	 Section

	Agreement	  	Preamble
	Antitrust Division	  	Section 7.4(a)
	Articles of Merger	  	Section 2.1
	Balance Sheet	  	Section 4.7(a)
	Balance Sheet Date	  	Section 4.7(a)
	Basket	  	Section 12.5(a)
	Cash Exchange Agreement	  	Section 2.4(a)
	Closing	  	Section 2.1
	Closing Date	  	Section 2.1
	Closing Purchase Price	  	Section 2.3
	COBRA	  	Section 4.15(p)

  

 9 

			
	Company	  	Preamble
	Company Board	  	Section 7.5(b)
	Company Common Stock	  	Recitals
	Company Disclosure Schedule	  	Article 4
	Company Documents	  	Section 4.2
	Company Marks	  	Section 11.5
	Company Permits	  	Section 4.18(b)
	Company Plans	  	Section 4.15(a)
	Company Property	  	Section 4.11(a)
	Company Termination Fee	  	Section 12.3
	Confidential Information	  	Section 7.1
	Confidentiality Agreement	  	Section 7.1
	Dissenting Shares	  	Section 2.6
	D&O Insurance	  	Section 11.3(c)
	Effective Time	  	Section 2.1
	ERISA Affiliate	  	Section 4.15(a)
	Escrow Agent	  	Section 2.5(a)
	Escrow Agreement	  	Section 2.5(a)
	Escrow Amount	  	Section 2.5(a)
	Escrow Funds	  	Section 2.5(c)
	Exchange Agent	  	Section 2.4(a)
	Financial Statements	  	Section 4.7
	FTC	  	Section 7.4(a)
	Houlihan Lokey	  	Preamble
	HSR Act	  	Section 3.2(b)
	Indemnified Directors and Officers	  	Section 11.3(a)
	Initial Escrow Release Amount	  	Section 2.5(d)
	Letter of Credit	  	Section 2.5(a)
	Losses	  	Section 12.3(a)
	Major Shareholders	  	Preamble
	Major Shareholder Documents	  	Section 3.1
	Major Shareholder Indemnified Parties	  	Section 12.3(b)
	Material Contract	  	Section 4.14(a)
	Merger	  	Recitals
	Merger Sub	  	Preamble
	Merger Sub Documents	  	Section 5.2
	Notice of Superior Offer	  	Section 7.5(c)
	Owned Property	  	Section 4.11(a)
	Parent	  	Preamble
	Parent Indemnified Parties	  	Section 12.3(a)
	Parent Termination Fee	  	Section 13.3
	Pay-Off Letters	  	Section 2.4(c)
	Per Share Closing Purchase Price	  	Section 2.3
	Per Share Escrow Amount	  	Section 2.5(e)
	Per Share Initial Escrow Release Amount	  	Section 2.5(d)
	Personal Property Leases	  	Section 4.12(b)

  

 10 

			
	Private Label Products	  	Section 4.13(d)
	Real Property Lease	  	Section 4.11(a)
	Related Persons	  	Section 4.21
	SAS	  	Section 7.8(b)
	Shareholder Notice	  	Section 7.14
	Shareholder Representative	  	Preamble
	Straddle Period	  	Section 12.7(b)
	Sub-Basket	  	Section 12.5(a)
	Survival Period	  	Section 12.2
	Surviving Corporation	  	Section 2.2(b)
	Tax Claim	  	Section 12.7(c)
	TBCA	  	Section 2.1
	Termination Date	  	Section 13.1(a)
	Third Party Claim	  	Section 12.4(b)
	Total Company Shares	  	Section 2.3

 Section 1.3 Other Definitional and Interpretive Matters. 
 (a) Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation shall apply: 
 (i) Calculation of Time Period. When calculating the period of time before which, within which or following which any act is to be
done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded. If the last day of such period is a non-Business Day, the period in question shall end on the next succeeding Business
Day. 
 (ii) Dollars. Any reference in this Agreement to “$” shall mean U.S. dollars. 
 (iii) Exhibits/Schedules. The Exhibits and Schedules to this Agreement are hereby incorporated and made a part hereof and are an
integral part of this Agreement. All Exhibits and Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any capitalized terms used in any Schedule or Exhibit but
not otherwise defined therein shall be defined as set forth in this Agreement. 
 (iv) Gender and Number. Any reference
in this Agreement to gender shall include all genders, and words imparting the singular number only shall include the plural and vice versa. 
 (v) Headings. The provision of a Table of Contents, the division of this Agreement into Articles, Sections and other subdivisions and the insertion of headings are for convenience of reference only and shall
not affect or be utilized in construing or interpreting this Agreement. All references in this Agreement to any “Article” or “Section” are to the corresponding Article or Section, respectively, of this Agreement unless otherwise
specified. 
  

 11 

 (vi) Herein. The words such as “herein,” “hereinafter,”
“hereof,” and “hereunder” refer to this Agreement as a whole and not merely to a subdivision in which such words appear unless the context otherwise requires. 
 (vii) Including. The word “including” or any variation thereof means “including, without limitation” and shall
not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it. 
 (b)
The parties hereto have participated jointly in the negotiation and drafting of this Agreement and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by the parties hereto
and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement. 
 ARTICLE II 
 THE MERGER 
 Section 2.1 Closing and Effective Date of Merger. Subject to and upon the terms and conditions set forth in this Agreement, the closing of the transactions contemplated under this Agreement (the “Closing”) will
be held at 10:00 a.m. (Dallas time) on a date to be specified by the parties, which date shall be no later than the third Business Day after satisfaction or waiver of the conditions set forth in Articles 8, 9 and 10 (other than
those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of those conditions at such time), at the offices of Weil, Gotshal & Manges LLP, 200 Crescent Court, Suite 300, Dallas,
Texas 75201, unless another time, date or place is agreed to in writing by the parties hereto (the date on which the Closing actually occurs is hereinafter referred to as the “Closing Date”). On the Closing Date, Company shall cause
to be definitively executed the Articles of Merger substantially in the form of Exhibit B attached hereto (the “Articles of Merger”), and cause such document to be filed with the Secretary of State of the State of the Texas
in order to cause the Merger to become effective under, and in accordance with, the applicable provisions of the Texas Business Corporation Act (the “TBCA”) and this Agreement. The Merger shall become effective on the date and at
the time of filing of the Articles of Merger with the Secretary of State of the State of Texas (the “Effective Time”). For all purposes, all of the document deliveries and other actions to occur at the Closing will be conclusively
presumed to have occurred at the same time, immediately before the Effective Time. 
 Section 2.2 Terms and Conditions of Merger.
At the Effective Time, pursuant to this Agreement and the Articles of Merger, automatically and without further action: 
 (a) Merger Sub
shall be merged with and into Company and the separate existence of Merger Sub shall cease. 
 (b) Company shall continue as the surviving
corporation in the Merger (the “Surviving Corporation”). 
  

 12 

 (c) The Merger shall have the effects set forth in this Agreement and the applicable provisions of the
TBCA. 
 (d) All of the estate, properties, rights, privileges, powers and franchises of Company and Merger Sub and all of their property,
real, personal and mixed, and all debts due on whatever account to either of Company or Merger Sub shall vest in the Surviving Corporation, without further act or deed, except as contemplated by this Agreement. 
 (e) The Surviving Corporation shall be responsible for all of the liabilities and obligations of each of Company and Merger Sub and the liabilities of
Company and Merger Sub shall not be affected nor shall the rights of creditors thereof or of any Persons dealing with Company or Merger Sub be impaired. 
 (f) The Articles of Incorporation of Company, as in effect immediately prior to the Effective Time, shall be amended in the Merger to be in the form of Exhibit C hereto and, as so amended, such Articles of
Incorporation shall be the Articles of Incorporation of the Surviving Corporation until thereafter changed or amended as provided therein or by applicable Law. 
 (g) At or prior to the Effective Time, Company shall cause its by-laws to be amended, as of the Effective Time, to read in their entirety as set forth in Exhibit D hereto and, as so amended, such by-laws shall
be the by-laws of the Surviving Corporation until thereafter changed or amended as provided therein or by applicable Law. 
 (h) From and
after the Effective Time, the Board of Directors of the Surviving Corporation will consist of the individuals set forth on Schedule 2.2(h). Each such Director will hold office, subject to the applicable provisions of the Articles of
Incorporation and the By-Laws of the Surviving Corporation, until the next annual meeting of shareholders of the Surviving Corporation and until his or her successor shall be duly elected or appointed and shall duly qualify. If, at or after the
Effective Time, a vacancy shall exist in the Board of Directors by reason of death or inability to act, or for any other reason, such vacancy may be filled in the manner provided in the By-Laws of the Surviving Corporation. 
 (i) The individuals to be identified in writing by Parent prior to the Closing shall be the officers of the Surviving Corporation and shall act as such
and hold the offices set forth opposite their names until their respective successors are duly elected or appointed and qualified. If, at or after the Effective Time, a vacancy shall exist in any of the offices of the Surviving Corporation by reason
of death or inability to act, or for any other reason, such vacancy may be filled in the manner provided in the By-Laws of the Surviving Corporation. 
 (j) Each issued and outstanding share of the capital stock of Merger Sub shall be converted into and represent the right to receive one share of common stock, par value $0.01 per share, of the Surviving Corporation,
whereupon Parent shall own all of the issued and outstanding capital stock of the Surviving Corporation. 
 (k) Each share of Company Common
Stock issued and outstanding immediately prior to the Effective Time (other than (i) any Dissenting Shares and (ii) any shares of Company Common Stock held as treasury stock by Company) shall become and be converted into the right 

  

 13 

 
to receive (A) an amount in cash equal to the Per Share Closing Purchase Price, plus (B) (subject to the provisions of
Section 2.5 below and the Escrow Agreement) an amount in cash equal to the Per Share Escrow Amount and the Per Share Initial Escrow Release Amount. 
 (l) Each share of Company Common Stock held as treasury stock by Company shall be cancelled, retired and cease to exist, and no payment shall be made with respect thereto. 
 Section 2.3 Calculation of Per Share Closing Purchase Price. For purposes of this Agreement, the term “Per Share Closing Purchase
Price” means (a) $188,670,430 plus (i) the Book Value of Undeveloped Land plus (ii) the Capital Expenditures for New/Raze & Rebuild Stores, plus
(iii) an amount equal to twenty-five percent (25%) of the sum of the Prepayment Penalties and Debt Defeasance Costs and the Unamortized Loan Costs (but in no event will the amount determined pursuant to this clause (iii) be more than
$10,000,000), minus (iv) the Company Transaction Expenses, minus (v) the Prepayment Penalties and Debt Defeasance Costs, minus (vi) the amount expended for any equity
repurchases or shareholder distributions by Company after June 2, 2007 (except that if the Closing has not occurred on or before December 21, 2007, other than any shareholder distributions made after December 21, 2007 not in excess in
the aggregate of $0.35 per share, reduced appropriately on a per share basis to the extent any additional shares of Company Common Stock are issued following the execution and delivery of this Agreement) and prior to the Closing,
minus (vii) income Taxes of Company and the Subsidiaries accrued through June 2, 2007 but not yet paid as of such date (such amount calculated pursuant to clause (a) of this Section 2.3 being the
“Closing Purchase Price”) divided by (b) the total number of shares of Company Common Stock outstanding immediately prior to the Effective Time (the “Total Company Shares”). No later than
two (2) Business Days prior to the Closing Date, Company shall deliver to Parent a certificate executed by Company’s chief executive officer and chief financial officer, setting forth a calculation of each item referred to in the
immediately preceding sentence which is relevant for purposes of determining the Closing Purchase Price. Such certificate shall be accompanied by such documentation and other evidence (including, in the case of the Company Transaction Expenses,
releases or other documentation from third party providers as to the total amounts due to such providers in connection with the transactions contemplated hereby; provided, that Company shall not be required to deliver documentation containing
attorney-client privileged information), reasonably satisfactory to Parent to enable Parent to confirm such calculations. The Closing Purchase Price will be based on such certified calculations as reasonably confirmed by Parent. 
 Section 2.4 Payment for Stock; Payment of Debt Payoff Amount; Procedures. 
 (a) At the Closing, Parent, the Surviving Corporation, the Shareholder Representative and third party agent reasonably satisfactory to Parent, Company and
the Shareholder Representative that is in the business of functioning as a cash exchange agent, in its capacity as cash exchange agent (in such capacity, the “Exchange Agent”), shall execute and deliver a Cash Exchange Agreement in
a form that is reasonably acceptable to Parent and the Shareholder Representative (the “Cash Exchange Agreement”). 
 (b) If
the Merger is consummated, then, at the Closing Parent shall deliver to the Exchange Agent an amount equal to the Closing Purchase Price, and the Exchange Agent shall, as soon as practicable after the Effective Time, pay and distribute to each
Company Shareholder 

  

 14 

 
the portion of the Closing Purchase Price to which such Company Shareholder is entitled pursuant to Section 2.2(k) hereof. The payment and
distribution by the Exchange Agent of the Closing Purchase Price shall be effected pursuant to, and in accordance with, the provisions of this Section 2.4 and the Cash Exchange Agreement. 
 (c) No later than three (3) Business Days prior to the contemplated Closing Date, Company shall use its commercially reasonable efforts to deliver
to Parent a debt pay-off letter from each lender under the Contracts set forth or required to be set forth in Schedule 4.7(d)(i) as of Closing in a form reasonably satisfactory to Parent, providing for full release of all obligations of
Company and its Subsidiaries and of all applicable security interests, upon payment at Closing of such amounts specified therein (the “Pay-Off Letters”), and at Closing, Parent shall deliver to such lenders an amount equal to the
Debt Payoff Amount, by wire transfer in immediately available funds, in each case pursuant to the terms of the Pay-Off Letter provided; 
 (d) As soon as practicable after the Effective Time, Parent and the Surviving Corporation shall cause the Exchange Agent to mail, to each Company Shareholder (i) a notice and a form letter of transmittal (which shall specify that
delivery of the Certificate or Certificates held by such Company Shareholder shall be effected, and risk of loss and title to such Certificate or Certificates shall pass, only upon proper delivery of such Certificate or Certificates to the Exchange
Agent) and (ii) instructions for use in effecting the surrender of such Certificate or Certificates in order to obtain payment in respect of the shares of Company Common Stock represented thereby. Each Certificate so surrendered shall be duly
endorsed or otherwise accompanied by a stock power or other instrument of transfer, in either case in form reasonably satisfactory to the Exchange Agent and Parent. Each Company Shareholder that is the registered holder of a Certificate shall be
entitled to receive from the Exchange Agent, upon surrender of such Certificate (together with any other required documents) to the Exchange Agent, payment without interest, of the portion of the Closing Purchase Price to which such Company
Shareholder is entitled pursuant to Section 2.2(k) hereof in respect of the number of shares of Company Common Stock represented by such Certificate. Each Certificate that is surrendered pursuant to this Section 2.4(d) shall
forthwith be canceled. 
 (e) In the event any Certificate shall have been lost, stolen or destroyed, upon receipt of appropriate evidence as
to such loss, theft or destruction and to the ownership of such Certificate by the Company Shareholder claiming such Certificate to be lost, stolen or destroyed, the receipt by the Exchange Agent of appropriate and customary indemnification, and the
receipt by the Exchange Agent of any other required documents (in each case, as reasonably satisfactory to the Exchange Agent and Parent), the Exchange Agent will pay and distribute to such Company Shareholder, without interest, the portion of the
Closing Purchase Price to which such Company Shareholder is entitled pursuant to Section 2.2(k) hereof in respect of the number of shares of Company Common Stock represented by such lost, stolen or destroyed Certificate. 
 (f) Notwithstanding anything in this Agreement to the contrary, in the event that, prior to the Effective Time, any Company Shareholder transfers all of
his, her or its beneficial ownership and interest of and in any shares of Company Common Stock to another Person, then any payment to which such Company Shareholder would otherwise be entitled pursuant to the Merger in respect of such shares of
Company Common Stock shall be paid to such other person 

  

 15 

 
and not to such Company Shareholder; provided that (i) such Person surrenders the appropriate Certificate representing such shares of Company
Common Stock, duly endorsed or otherwise in proper form for transfer, and (ii) such Company Shareholder shall pay any transfer or other Taxes required by reason of making any such payment to any such Person and such Person not being the
registered holder of such Certificate, or such Company Shareholder shall establish to the satisfaction of the Exchange Agent and Parent that any such transfer or other Taxes have been paid or are not applicable. 
 (g) If any shareholders of Company exercise, perfect and/or reserve their appraisal or dissenters rights pursuant to, and in accordance with, the TBCA
and if such shareholders of Company do not withdraw such shareholders’ demand for appraisal prior to the expiration of the period of time during which such shareholders of Company are permitted to effect such withdrawal under the TBCA, then,
upon the first anniversary of the Closing Date, the Exchange Agent shall release to Parent the amount by which the Closing Purchase Price exceeds the portion of the Closing Purchase Price to which all Company Shareholders are entitled pursuant to
Section 2.2(k) hereof. 
 Section 2.5 Escrow. 
 (a) At the Closing Parent shall deposit two letters of credit (each a “Letter of Credit”) issued by a bank or other reputable financial
institution, each of which Letters of Credit may be drawn upon in the amount of $10,000,000 as described below (the $20,000,000 total amount to be drawn upon under the Letters of Credit being referred to herein as the “Escrow
Amount”) in escrow pursuant to the terms of an Escrow Agreement in the form of Exhibit E hereto, with such changes thereto as may reasonably be required by the escrow agent thereunder (the “Escrow Agreement”) among
Parent, Company, the Shareholder Representative and a bank or other financial institution reasonably satisfactory to Parent, Company and the Shareholder Representative, as escrow agent thereunder (in such capacity, the “Escrow
Agent”). 
 (b) If any shareholders of Company exercise, perfect and/or reserve their appraisal or dissenters rights pursuant to,
and in accordance with, the TBCA and if such shareholders of Company do not withdraw such shareholders’ demand for appraisal prior to the expiration of the period of time during which such shareholders of Company are permitted to effect such
withdrawal under the TBCA, then, immediately after the first anniversary of the Closing Date, the Escrow Agent shall deliver to Parent the amount by which the Escrow Amount exceeds the Escrow Funds. 
 (c) For purposes of this Agreement, the term “Escrow Funds” shall mean an amount equal to the product obtained by multiplying the Escrow
Amount, without interest, by a fraction, the numerator of which shall be equal to the Total Company Shares less the Dissenting Shares, and the denominator of which shall be equal to the Total Company Shares. 
 (d) On the first anniversary of the Closing Date, the Escrow Agent will draw upon the first Letter of Credit in the amount of $10,000,000 and will
release to the Shareholder Representative (for redistribution to the Company Shareholders, as provided herein), in accordance with the provisions of the Escrow Agreement, an amount in cash equal to .5 multiplied by the Escrow Funds (the
“Initial Escrow Release Amount”), less the total amount of 

  

 16 

 
settled and/or pending claims that have been made against the Escrow Funds pursuant to, and in accordance with, the provisions of Article 11 hereof
and the Escrow Agreement. In the event that any of the Initial Escrow Release Amount is released to the Shareholder Representative pursuant to the provisions of this Section 2.5(d), then each Company Shareholder shall be entitled to
receive from the Shareholder Representative that portion of any such Initial Escrow Release Amount as shall be equal to (i) the quotient obtained by dividing the amount of any such Initial Escrow Release Amount so distributed by the number of
shares of Company Common Stock held by all of the Company Shareholders at the Effective Time (the “Per Share Initial Escrow Release Amount”) multiplied by (ii) the total number of shares of Company Common Stock held by such
Company Shareholder at the Effective Time. The Shareholder Representative shall be responsible to properly distribute any such amounts to the Company Shareholders, and none of Parent, the Surviving Corporation or the Escrow Agent shall have any
responsibility for such distribution, and the Company Shareholders shall look only to the Shareholder Representative with respect to such distribution. 
 (e) On the second anniversary of the Closing Date, the Escrow Agent will draw upon the second Letter of Credit in the amount of $10,000,000 and will release to the Shareholder Representative (for redistribution to the
Company Shareholders, as provided herein), in accordance with the provisions of the Escrow Agreement, an amount in cash equal to the Escrow Funds less the total amount of the Initial Escrow Release Amount and less the total amount of settled and/or
pending claims that have been made against the Escrow Funds pursuant to, and in accordance with, the provisions of Article 12 hereof and the Escrow Agreement. In addition, at such time as all claims pending as of the second anniversary of the
Effective Time are resolved or paid, if any Escrow Funds remain the Escrow Agent will release such remaining Escrow Funds to the Shareholder Representative (for redistribution to the Company Shareholders, as provided herein) in accordance with the
provisions of the Escrow Agreement and this Section 2.5(e). In the event that any of the Escrow Funds are released to the Shareholder Representative pursuant to the provisions of the first two sentences of this
Section 2.5(e), then each Company Shareholder shall be entitled to receive that portion of any such Escrow Funds as shall be equal to (i) the quotient obtained by dividing the amount of any such Escrow Funds so distributed by the
number of shares of Company Common Stock held by all of the Company Shareholders at the Effective Time (the “Per Share Escrow Amount”) multiplied by (ii) the total number of shares of Company Common Stock held by such Company
Shareholder at the Effective Time. The Shareholder Representative shall be responsible to properly distribute any such amounts to the Company Shareholders, and none of Parent, the Surviving Corporation or the Escrow Agent shall have any
responsibility for such distribution, and the Company Shareholders shall look only to the Shareholder Representative with respect to such distribution. 
 Section 2.6 Dissenting Shares. Notwithstanding any provision of this Agreement to the contrary, with respect to any shares of Company Common Stock held by shareholders of Company who have exercised and
perfected and/or reserved their appraisal or dissenters rights (the “Dissenting Shares”) in accordance with the TBCA, such Dissenting Shares shall not be converted into or represent the right to receive the consideration payable
pursuant to this Agreement upon consummation of the Merger (or any amounts pursuant to Section 2.5 hereof), but, instead, the holders of Dissenting Shares shall be entitled to payment of the appraised value of such Dissenting Shares in
accordance with the provisions of the TBCA, unless and to the 

  

 17 

 
extent that any such holder of Dissenting Shares shall have irrevocably forfeited his, her or its right to appraisal under the TBCA or irrevocably withdrawn
his, her or its demand for appraisal. If any such holder of Dissenting Shares has so irrevocably forfeited or withdrawn his, her or its right to appraisal of Dissenting Shares, then, as of the occurrence of such event, such holder’s Dissenting
Shares shall cease to be Dissenting Shares and shall be converted into and represent the right to receive the consideration payable in respect of such shares pursuant to this Agreement, which payments shall be made pursuant to the terms of this
Agreement, and Parent and Merger Sub shall set aside such amounts as needed to make such payments. 
 Section 2.7 No Further
Transfers. After the Effective Time, there shall be no further registration of transfer on the stock transfer books of Company of any shares of Company Common Stock. If, after the Effective Time, any Certificate is presented (for transfer or
otherwise) to the Surviving Corporation or its transfer agent, such Certificate shall be canceled and, subject to the procedures provided for in Section 2.4 hereof, payment shall be made of the consideration provided for in this
Agreement in respect of the number of shares of Company Common Stock represented by such Certificate. 
 Section 2.8 Termination of
Rights. After the Effective Time, holders of Company Common Stock will cease to be, and will have no rights as, shareholders of Company, and such holders’ rights will consist only of (a) in the case of shares other than Dissenting
Shares, the right to receive the consideration provided for in this Agreement in respect of such shares, and (b) in the case of Dissenting Shares, the rights afforded to the holders thereof under the applicable provisions of the TBCA. Until
surrendered for cancellation in accordance with the provisions of this Article 2, each stock certificate representing shares of Company Common Stock shall, from and after the Effective Time, represent (i) in the case of shares other than
Dissenting Shares, the right to receive the consideration provided for in this Agreement in respect of such shares and (ii) in the case of Dissenting Shares, the rights afforded to the holders thereof under the applicable provisions of the
TBCA. 
 Section 2.9 No Liability. Notwithstanding anything to the contrary in this Agreement, none of the Exchange Agent, the
Surviving Corporation or any party hereto shall be liable to a holder of shares of Company Common Stock for any amount properly paid to a public official pursuant to any applicable abandoned property, escheat or similar law. 
 Section 2.10 Appointment of Shareholder Representative. 
 (a) In order to efficiently administer the transactions contemplated hereby, Company hereby designates David Lloyd Norris as the Shareholder Representative. The right of any Company Shareholder to receive all or any
portion of the Per Share Initial Escrow Release Amount or the Per Share Escrow Amount is subject in all cases to the provisions of this Section 2.10. In addition, by virtue of the adoption of this Agreement and the approval of the Merger
by the Company Shareholders by written consent in lieu of a meeting pursuant to, and in accordance with, the applicable provisions of the TBCA, each Company Shareholder (regardless of whether or not such Company Shareholder has voted in favor of the
approval of this Agreement and the approval of the Merger) that is not a holder of Dissenting Shares hereby agrees that: 
  

 18 

 (i) Parent and the Escrow Agent shall be able to rely conclusively on the instructions
and decisions of the Shareholder Representative as to the settlement of any claims against the Escrow Funds pursuant to Articles 2 and 11 hereof and the Escrow Agreement, or as to any other actions required or permitted to be taken by
the Shareholder Representative hereunder or under the Escrow Agreement or the Cash Exchange Agreement, and no party hereunder shall have any cause of action against Parent, the Escrow Agent or the Exchange Agent to the extent Parent, the Escrow
Agent or the Exchange Agent, respectively, has relied upon the instructions or decisions of the Shareholder Representative; 
 (ii) all actions, decisions and instructions of the Shareholder Representative shall be conclusive and binding upon all of the Company Shareholders and no Company Shareholder shall have any cause of action against the Shareholder
Representative for any action taken, decision made or instruction given by the Shareholder Representative under this Agreement, except for fraud or willful misconduct by the Shareholder Representative; 
 (iii) the provisions of this Section 2.10 are independent and severable, are irrevocable and coupled with an interest and
shall be enforceable notwithstanding any rights or remedies that any Company Shareholder may have in connection with the transactions contemplated by this Agreement; 
 (iv) remedies available at law for any breach of the provisions of this Section 2.10 are inadequate; therefore, Parent, Merger
Sub and/or the Surviving Corporation shall be entitled to temporary and permanent injunctive relief without the necessity of proving damages if either Parent, Merger Sub and/or the Surviving Corporation brings an action to enforce the provisions of
this Section 2.10; and 
 (v) the provisions of this Section 2.10 shall be binding upon the executors,
heirs, legal representatives, personal representatives, successor trustees, and successors of each Company Shareholder, and any references in this Agreement to a Company Shareholder or Company Shareholders shall mean and include the successors to
the Company Shareholders’ rights hereunder, whether pursuant to testamentary disposition, the laws of descent and distribution or otherwise. 
 (b) The Company Shareholders hereby authorize the Shareholder Representative to take any and all action as is contemplated to be taken by or on behalf of the Company Shareholders, and to assert the Company Shareholders’ rights granted,
pursuant to the terms of this Agreement, the Cash Exchange Agreement and the Escrow Agreement. 
 (c) The Shareholder Representative may
resign such position at any time, effective with respect to each Company Shareholder immediately upon written notice of such resignation delivered to Company by such resigning Shareholder Representative. In the event that David Lloyd Norris, dies,
becomes unable or unwilling to perform his responsibilities hereunder or resigns from such position, James Randal Brooks shall fill such vacancy and shall be deemed to be the Shareholder Representative for all purposes of this Agreement and the
documents delivered pursuant hereto. In the event that James Randal Brooks, dies, becomes unable or 

  

 19 

 
unwilling to perform his responsibilities hereunder or resigns from such position, the Shareholder Representative shall by appointed by the Major
Shareholders (voting on a per-share-owned-immediately-prior-to-closing basis). 
 (d) The Shareholder Representative will not be liable to
the Company Shareholders for any act taken or omitted by Shareholder Representative as permitted under this Agreement and the post-Closing transactions contemplated hereby, except if such act is taken or omitted in bad faith or by willful
misconduct. The Shareholder Representative will also be fully protected against the Company Shareholders in relying upon any written notice, demand, certificate or document that it in good faith believes to be genuine (including facsimiles thereof).

 (e) The Company Shareholders agree to indemnify, from and after the Closing, the Shareholder Representative for, and to hold the
Shareholder Representative harmless against, any loss, liability or expense incurred without willful misconduct or bad faith on the part of the Shareholder Representative, arising out of or in connection with the Shareholder Representative duties
under this Agreement and the transactions contemplated hereby, including costs and expenses of successfully defending the Shareholder Representative against any claim of liability with respect thereto. The Shareholder Representative may consult with
counsel of its own choice and will be fully protected for any action taken and suffered by it in good faith and in accordance with the opinion of such counsel. 
 Section 2.11 Withholding Rights. The Exchange Agent and Parent shall be entitled to deduct and withhold from the consideration otherwise payable to any holder of shares of Company Common Stock pursuant to
this Agreement such amounts as may be required to be deducted and withheld with respect to the making of such payment under the Code and the rules and regulations promulgated thereunder, or under any provision of any state or foreign Law with
respect to Taxes. To the extent that amounts are so withheld and paid over to the appropriate Taxing Authority, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the holder of the shares of Company
Common Stock in respect of which such deduction and withholding was made by the Exchange Agent or Parent, as the case may be. 
 ARTICLE III

 REPRESENTATIONS AND WARRANTIES OF THE MAJOR SHAREHOLDERS 
 Each Major Shareholder, severally and not jointly, hereby represents and warrants to Merger Sub and Parent that: 
 Section 3.1 Execution and Delivery of Agreement and Major Shareholder Documents. This Agreement has been, and each of the documents to be executed by such Major Shareholder in connection with the consummation of the transactions
contemplated by this Agreement (the “Major Shareholder Documents”) will be at or prior to the Closing, duly and validly executed and delivered by such Major Shareholder and, assuming due authorization, execution and delivery by the
other parties hereto and thereto, this Agreement constitutes, and such Major Shareholder Documents when so executed and delivered will constitute, legal, valid and binding obligations of such Major Shareholder, enforceable against such Major
Shareholder in accordance with their terms. 
  

 20 

 Section 3.2 Conflicts; Consents of Third Parties. 
 (a) Assuming that all consents, approvals, authorizations and Permits described in Section 3.2(b) have been obtained and all filings and
notifications described in Section 3.2(b) have been made and any waiting periods thereunder have terminated or expired, none of the execution and delivery by a Major Shareholder of this Agreement or the Major Shareholder Documents, the
consummation by such Major Shareholder of the transactions contemplated hereby or thereby, or compliance by such Major Shareholder with any of the provisions hereof or thereof will conflict with, or result in any violation of or default (with or
without notice or lapse of time, or both) under, or give rise to a right of termination or cancellation under any provision of (i) any Contract, or Permit to which such Major Shareholder or Company is a party or by which any of the properties
or assets of such Major Shareholder or Company are bound; (ii) any Order of any Governmental Entity applicable to such Major Shareholder or Company or by which any of the properties or assets of such Major Shareholder or Company are bound; or
(iii) any applicable Law, except in the case of clauses (i) through (iii), where such conflicts, violations, breaches, defaults, losses or rights would not cause a material adverse impact on the ability of a Major Shareholder to perform
his obligations hereunder. 
 (b) No consent, waiver, approval, Order, Permit or authorization of, or declaration or filing with, or
notification to, any Person or Governmental Entity is required on the part of such Major Shareholder in connection with the execution and delivery of this Agreement, the Major Shareholder Documents, the compliance by such Major Shareholder with any
of the provisions hereof, or the consummation by such Major Shareholder of the transactions contemplated hereby, except for (i) compliance with the applicable requirements of the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended,
and the rules and regulations promulgated thereunder (the “HSR Act”), (ii) Alcohol Filings, (iii) Lottery Filings and (iv) Storage Tank Filings. 
 Section 3.3 Ownership. Such Major Shareholder is the record and beneficial owner of Company Common Stock indicated as being owned by such
Major Shareholder on Schedule 3.3. Such Major Shareholder has the power and authority to vote such Company Common Stock to authorize this Agreement and the transactions contemplated hereby including the Merger. 
 Section 3.4 Financial Advisors. Except for Houlihan Lokey, Morgan, Keegan & Co, Inc. and Trefethen & Company, LLC, no
Person has acted, directly or indirectly, as a broker, finder or financial advisor for such Major Shareholder in connection with the transactions contemplated by this Agreement and no Person is or will be entitled to any fee or commission or like
payment in respect thereof. 
 ARTICLE IV 
 REPRESENTATIONS AND WARRANTIES OF COMPANY 
 Company and the Major Shareholders hereby jointly and severally represent and warrant
to Merger Sub and Parent that, except as set forth in the disclosure schedule of Company attached hereto (the “Company Disclosure Schedule”): 
  

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 Section 4.1 Organization; Good Standing. Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Texas and has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now conducted and as currently proposed to be conducted.
Company is duly qualified or authorized to do business as a foreign corporation and is in good standing under the laws of each jurisdiction in which it owns or leases real property and each other jurisdiction in which the conduct of its business or
the ownership of its properties requires such qualification or authorization, except where the failure to be so qualified, authorized or in good standing would not reasonably be expected to have a Material Adverse Effect. 
 Section 4.2 Authorization of Agreement. Company has all requisite power, authority and legal capacity to execute and deliver this Agreement
and each other agreement, document, or instrument or certificate contemplated by this Agreement or to be executed by Company in connection with the transactions contemplated by this Agreement (the “Company Documents”), to perform
its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance of this Agreement and each of the Company Documents, and the consummation of the transactions
contemplated hereby and thereby, have been duly authorized and approved by all required action on the part of Company. This Agreement has been, and each of the Company Documents will be at or prior to the Closing, duly and validly executed and
delivered by Company and (assuming due authorization, execution and delivery by the other parties hereto and thereto (other than the Major Shareholders)) this Agreement constitutes, and each of the Company Documents when so executed and delivered
will constitute, legal, valid and binding obligations of Company, enforceable against Company in accordance with their respective terms, subject only to the effect, if any, of (i) applicable bankruptcy, insolvency, moratorium or other similar
laws affecting the rights of creditors generally and (ii) rules of Law governing specific performance, injunctive relief and other equitable remedies. The Company Documents have been duly authorized by unanimous vote of those directors of
Company’s Board of Directors. Company’s Board of Directors has unanimously resolved to and has recommended that the shareholders of Company approve this Agreement and has directed (prior to shareholder approval) that this Agreement be
submitted to the shareholders of Company for their approval. Further, this Agreement and the agreement and transactions contemplated hereby have been approved by written consent by holders of two-thirds the Company Common Stock. The affirmative
approval of two-thirds the holders of the Company Common Stock is the only vote of the holders of any class or series of capital stock of Company necessary to approve or adopt this Agreement and approve the transactions contemplated hereby,
including the Merger. Such affirmative vote of the requisite holders of the Company Common Stock has been validly obtained. No other corporate proceedings on the part of Company are necessary to authorize this Agreement or to consummate the
transactions contemplated hereby. 
 Section 4.3 Conflicts; Consents of Third Parties. 
 (a) Assuming that all consents, approvals, authorizations and Permits described in Section 4.3(b) have been obtained and all filings and
notifications described in Section 4.3(b) have been made and any waiting periods thereunder have terminated or expired, none of the execution and delivery by Company of this Agreement or the Company Documents, the 

  

 22 

 
consummation of the transactions contemplated hereby or thereby, or compliance by Company with any of the provisions hereof or thereof will conflict with, or
result in any violation or breach of, conflict with or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or loss of a material benefit under, or
give rise to any obligation of Company to make any payment under, or to the increased, additional, accelerated or guaranteed rights or entitlements of any Person under, or result in the creation of any Encumbrance upon any of the properties or
assets of Company or any Subsidiary under, any provision of (i) the articles of incorporation and by-laws or comparable organizational documents of Company or any Subsidiary; (ii) any material Contract, or material Permit to which Company
or any Subsidiary is a party or by which any of the properties or assets of Company or any Subsidiary are bound; (iii) any Order applicable to Company or any Subsidiary or any of the properties or assets of Company or any Subsidiary; or
(iv) any applicable Law, except to the extent such conflict, violation, breach, default, loss or right as would cause a material adverse impact on Company and its Subsidiaries. 
 (b) No consent, waiver, approval, Order, Permit or authorization of, or declaration or filing with, or notification to, any Person or Governmental Entity
is required on the part of Company or any Subsidiary in connection with (i) the execution and delivery of this Agreement, the Company Documents, the compliance by Company with any of the provisions hereof, or the consummation by Company or any
subsidiary of the transactions contemplated hereby, or (ii) the continuing validity and effectiveness immediately following the Closing of any material Permit or material Contract of Company or any Subsidiary, except for (A) compliance
with the applicable requirements of the HSR Act, (B) the filing of the Articles of Merger with the Secretary of State of the State of Texas pursuant to the TBCA and Section 2.1 hereof, (C) Alcohol Filings, (D) Lottery Filings and
(E) Storage Tank Filings. 
 Section 4.4 Capitalization. 
 (a) The authorized capital stock of Company consists of 10,000,000 shares of Company Common Stock. As of the date hereof, there are 4,537,490 shares of
Company Common Stock issued and outstanding and 1,462,510 shares of Company Common Stock are held by Company as treasury stock. All of the issued and outstanding shares of Company Common Stock were duly authorized for issuance and are validly
issued, fully paid and non-assessable and were not issued in violation of any purchase or call option, right of first refusal, subscription right, preemptive right or any similar rights. All of the outstanding shares of Company Common Stock are
owned of record by the holders and in the respective amounts as are set forth on Schedule 4.4(a). 
 (b) There are no existing option,
warrant, call, right or Contract to which any Company Shareholder or Company is a party requiring, and there are no securities of Company outstanding which upon conversion or exchange would require, the issuance, sale or transfer of any additional
shares of capital stock or other equity securities of Company or other securities convertible into, exchangeable for or evidencing the right to subscribe for or purchase shares of capital stock or other equity securities of Company. There are no
obligations, contingent or otherwise, of Company or any Subsidiary to (i) repurchase, redeem or otherwise acquire any shares of Company Common Stock or the capital stock or other equity interests of any 

  

 23 

 
Subsidiary, or (ii) provide material funds to, or make any material investment in (in the form of a loan, capital contribution or otherwise), or provide
any guarantee with respect to the obligations of, any Person. There are no outstanding stock appreciation, phantom stock, profit participation or similar rights with respect to Company or any of its Subsidiaries. There are no bonds, debentures,
notes or other Indebtedness of Company or its Subsidiaries having the right to vote or consent (or, convertible into, or exchangeable for, securities having the right to vote or consent) on any matters on which shareholders (or other equityholders)
of Company of its Subsidiaries may vote. There are no voting trusts, irrevocable proxies or other Contracts or understandings to which Company or any Subsidiary or any Company Shareholder is a party or is bound with respect to the voting or consent
of any shares of Company Common Stock or the equity interests of any Subsidiary. 
 Section 4.5 Subsidiaries. Schedule 4.5
sets forth the name of each Subsidiary, and, with respect to each Subsidiary, the jurisdiction in which it is incorporated or organized, the jurisdictions, if any, in which it is qualified to do business, the number of shares of its authorized
capital stock, the number and class of shares thereof duly issued and outstanding, the names of all shareholders or other equity owners and the number of shares of stock owned by each such shareholder or the amount of equity owned by each such
equity owner. Each Subsidiary is a duly organized and validly existing corporation, partnership or other entity in good standing under the laws of the jurisdiction of its incorporation or organization and is duly qualified or authorized to do
business as a foreign corporation or entity and is in good standing under the laws of each jurisdiction in which the conduct of its business or the ownership of its properties requires such qualification or authorization, except where the failure to
be so qualified, authorized or in good standing has not had and would not reasonably be expected to have a Material Adverse Effect. Each Subsidiary has all requisite corporate or entity power and authority to own its properties and carry on its
business as presently conducted. The outstanding shares of capital stock or equity interests of each Subsidiary are validly issued, fully paid and non-assessable and were not issued in violation of any purchase or call option, right of first
refusal, subscription right, preemptive right or any similar right. All such shares or other equity interests represented as being owned by Company or any of its Subsidiaries are owned by them free and clear of any and all Encumbrances. No shares of
capital stock are held by any Subsidiary as treasury stock. There is no existing option, warrant, call, right or Contract to which any Subsidiary is a party requiring, and there are no convertible securities of any Subsidiary outstanding which upon
conversion would require, the issuance of any shares of capital stock or other equity interests of any Subsidiary or other securities convertible into shares of capital stock or other equity interests of any Subsidiary. Company does not own,
directly or indirectly, any capital stock or equity securities of any Person other than its Subsidiaries. There are no material restrictions (other than limitations on dividends applicable under corporate “dividend statutes” or
similar Laws) on the ability of its Subsidiaries to make distributions of cash to their respective equity holders. 
 Section 4.6
Corporate Records. 
 (a) Company has delivered to Parent true, correct and complete copies of the articles of incorporation (each
certified by the Secretary of State or other appropriate official of the applicable jurisdiction of organization) and by-laws (each certified by the secretary, assistant 

  

 24 

 
secretary or other appropriate officer) or comparable organizational documents of Company and each of its Subsidiaries in each case as amended and in effect
on the due date hereof, including all amendments thereto. 
 (b) The minute books of Company and each of its Subsidiaries previously made
available to Parent contain true and correct records of all meetings and accurately reflect, in all material respects, all other corporate actions of the shareholders and board of directors (including committees thereof) of Company and its
Subsidiaries. The stock certificate books and stock transfer ledgers of Company and its Subsidiaries previously made available to Parent are true, correct and complete. 
 Section 4.7 Financial Statements and Related Matters. 
 (a) Company has delivered to Parent
copies of (i) the audited consolidated balance sheets of Company and its Subsidiaries as at October 31, 2006, 2005 and 2004 and the related audited consolidated statements of income and of cash flows of Company and its Subsidiaries for the
years then ended and (ii) the unaudited consolidated balance sheet of Company and its Subsidiaries as at August 4, 2007, and the related consolidated statements of income and cash flows of Company and its Subsidiaries for the 9 month
period then ended (such audited and unaudited statements, including the related notes and schedules thereto, are referred to herein as the “Financial Statements”). Each of the Financial Statements has been prepared in accordance
with GAAP consistently applied by Company throughout the periods presented (except as may be indicated in the notes thereto or, in the case of unaudited financial statements, subject to normal audit adjustments, the lack of footnotes and other
presentation items, the effect of which would not be material in the aggregate) and presents fairly in all material respects the consolidated financial position, results of operations and cash flows of Company and its Subsidiaries as at the dates
and for the periods indicated therein. The audited consolidated balance sheet of Company and its Subsidiaries as at October 31, 2006 is referred to herein as the “Balance Sheet” and October 31, 2006 is referred to herein
as the “Balance Sheet Date.” 
 (b) All books, records and accounts of Company and its Subsidiaries are maintained in all
material respects in accordance with applicable Laws and good business practice, including the maintenance of an adequate system of internal controls, recognizing that neither Company nor any of its Subsidiaries is subject to compliance with the
rules and regulations governing internal controls set forth in the Securities Exchange Act of 1934, as amended. Company has provided Parent with copies of all management letters related to audits of Company and its Subsidiaries for the last three
(3) fiscal years. 
 (c) The total cash and cash equivalents of Company and its Subsidiaries as at June 2, 2007 was $5,622,865, and
the total amount of Indebtedness for borrowed money and principal portion of capital lease obligations as at June 2, 2007 was $134,795,855; each of such figures was determined in accordance with GAAP applied consistently with the application
thereof used in the preparation of the balance sheets included in each of the Financial Statements. 
 (d) Except as set forth on Schedule
4.7(d), Company has (i) no Indebtedness for borrowed money, (ii) no obligations under leases required to be capitalized in accordance with GAAP and (iii) no obligations for the reimbursement of any obligor on any letter of credit.

  

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 Section 4.8 No Undisclosed Liabilities. Neither Company nor any Subsidiary has any
Indebtedness or Liabilities (required under GAAP to be reflected on a balance sheet or the notes thereto) other than those (i) specifically reflected on and fully reserved against in the Balance Sheet or (ii) incurred in the Ordinary
Course of Business since the Balance Sheet Date. 
 Section 4.9 Absence of Certain Developments. Except as expressly contemplated
by this Agreement, since the Balance Sheet Date (i) Company and its Subsidiaries have conducted their respective businesses only in the Ordinary Course of Business and (ii) there has not been any event, change, occurrence or circumstance
that, individually or in the aggregate with any such events, changes, occurrences or circumstances, has had or could reasonably be expected to have a Material Adverse Effect. 
 Section 4.10 Taxes. 
 (a)
(i) All Tax Returns required to be filed by or on behalf of Company and each of its Subsidiaries have been duly and timely filed with the appropriate Taxing Authority in all jurisdictions in which such Tax Returns are required to be filed
(after giving effect to any valid extensions of time in which to make such filings), and all such Tax Returns are true, complete and correct in all material respects; and (ii) all Taxes payable by or on behalf of Company and each of its
Subsidiaries have been fully and timely paid. With respect to any period for which Tax Returns have not yet been filed or for which Taxes are not yet due or owing, Company has made due and sufficient accruals for such Taxes in the Financial
Statements. All required estimated Tax payments sufficient to avoid any underpayment penalties or interest have been made by or on behalf of Company and each of its Subsidiaries. 
 (b) Company and each of its Subsidiaries has complied in all material respects with all applicable Laws relating to the payment and withholding of Taxes
and has duly and timely withheld and paid over to the appropriate Taxing Authority all amounts required to be so withheld and paid under all applicable Laws. 
 (c) Company has made available to Parent complete copies of (i) all federal, state, local and foreign income and franchise Tax Returns of Company and each of its Subsidiaries relating to the taxable periods
ending after December 31, 2003 and (ii) all audit reports issued within the last three years relating to Taxes due from or with respect to Company or any of its Subsidiaries. 
 (d) No written claim has been received from a Taxing Authority in a jurisdiction where Company or any of its Subsidiaries does not file Tax Returns such
that it is or may be subject to taxation by that jurisdiction. 
 (e) All deficiencies asserted or assessments made as a result of any
examinations by any Taxing Authority of the Tax Returns of, or including, Company or any of its Subsidiaries have been fully paid, and there are no audits or investigations by any Taxing Authority in progress, nor has Company or any of its
Subsidiaries received any written notice from any Taxing Authority that it intends to conduct such an audit or investigation. No issue has been raised by a Taxing Authority in any prior examination of Company or any of its Subsidiaries 

  

 26 

 
which, by application of the same or similar principles, could reasonably be expected to result in a proposed deficiency for any subsequent taxable period.

 (f) None of Company, any of its Subsidiaries or any other Person on any of their behalf has (i) agreed to or is required to make any
adjustments pursuant to Section 481(a) of the Code or any similar provision of Law or has any Knowledge that any Taxing Authority has proposed any such adjustment, or has any application pending with any Taxing Authority requesting permission
for any changes in accounting methods that relate to Company or any of its Subsidiaries, (ii) executed or entered into a closing agreement pursuant to Section 7121 of the Code or any similar provision of Law with respect to Company or any
of its Subsidiaries, (iii) requested any extension of time within which to file any Tax Return, which Tax Return has since not been filed, (iv) granted any extension for the assessment or collection of Taxes, which Taxes have not since
been paid, or (v) granted to any Person any power of attorney that is currently in force with respect to any Tax matter. 
 (g) No
property owned by Company or any of its Subsidiaries is (i) property required to be treated as being owned by another Person pursuant to the provisions of Section 168(f)(8) of the Internal Revenue Code of 1954, as amended and in effect
immediately prior to the enactment of the Tax Reform Act of 1986, (ii) “tax-exempt use property” within the meaning of Section 168(h)(1) of the Code, (iii) “tax-exempt bond financed property” within the meaning of
Section 168(g) of the Code, (iv) “limited use property” within the meaning of Rev. Proc. 76-30, (v) subject to Section 168(g)(1)(A) of the Code, or (vi) subject to any provision of state, local or foreign Law
comparable to any of the provisions listed above. 
 (h) Neither Company nor any of its Subsidiaries is a party to any Tax sharing,
allocation, indemnity or similar agreement or arrangement (whether or not written) pursuant to which it will have any obligation to make any payments after the Closing. 
 (i) There is no Contract, plan or arrangement covering any person that, individually or collectively, could give rise to the payment of any amount that would not be deductible by Parent, Company or any of their
respective Affiliates by reason of Section 280G of the Code. 
 (j) Neither Company nor any of its Subsidiaries is subject to any
private letter ruling of the IRS or comparable rulings of any Taxing Authority. 
 (k) Neither Company nor any of its Subsidiaries has ever
been a member of any consolidated, combined, affiliated or unitary group of corporations for any Tax purposes other than a group in which Company is the common parent. 
 (l) Neither Company nor any of its Subsidiaries has constituted either a “distributing corporation” or a “controlled corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in a
distribution of stock qualifying for Tax-free treatment under Section 355 of the Code (i) in the two years prior to the date of this Agreement or (ii) in a distribution which could otherwise constitute part of a “plan” or
“series of related transactions” (within the meaning of Section 355(e) of the Code) in conjunction with the transactions contemplated by this Agreement. 
  

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 (m) There is no taxable income of Company or any of its Subsidiaries that will be required under
applicable Tax Law to be reported by Parent or any of its Affiliates, including Company or any of the Subsidiaries, for a taxable period (or portion thereof) beginning after June 2, 2007 which taxable income was realized (and reflects economic
income) arising prior to such date. 
 (n) Company and each of its Subsidiaries have disclosed on their federal income Tax Returns all
positions taken therein that could give rise to substantial understatement of federal income Tax within the meaning of Section 6662 of the Code. 
 (o) Neither Company nor any of its Subsidiaries has participated in any “reportable transaction” within the meaning of Treasury Regulation Section 1.6011-4(b). 
 Section 4.11 Real Property. 
 (a)
Schedule 4.11(a) sets forth a complete list of (i) all real property and interests in real property, including improvements thereon and easements appurtenant thereto owned in fee by Company or any of its Subsidiaries (individually, an
“Owned Property” and collectively, the “Owned Properties”), (ii) all real property and interests in real property leased by Company or any of its Subsidiaries (individually, a “Real Property
Lease” and collectively, the “Real Property Leases” and, together with the Owned Properties, being referred to herein individually as a “Company Property” and collectively as the “Company
Properties”) as lessee or lessor, including a description of each such Real Property Lease (including the name of the third party lessor or lessee and the date of the lease or sublease and all amendments thereto), and (iii) the type of
use for which each Owned Property or Real Property Lease is held (e.g., operating store, office, land held for development). Company and its Subsidiaries have indefeasible fee title to all Owned Property, free and clear of all Encumbrances of any
nature whatsoever, except (A) those Encumbrances set forth on Schedule 4.11(a) and (B) Permitted Encumbrances. The Company Properties constitute all interests in real property currently used, occupied or currently held for use in
connection with the business of Company and its Subsidiaries and which are necessary for the continued operation of the business of Company and its Subsidiaries as the business is currently conducted. To the Knowledge of Company, none of the
material improvements located on Company Properties constitute a violation of applicable Laws. Company has delivered to Parent true, correct and complete copies of the Real Property Leases, together with all amendments, modifications or supplements,
if any, thereto. The Company Properties are not subject to any leases, rights of first refusal, options to purchase or rights of occupancy, except the Real Property Leases set forth on Schedule 4.11(a). Company has a valid owner policy of
title insurance on each of the Owned Properties for the purchase price or value thereof at the time of acquisition, which policy insures the record title of Company subject only to Permitted Encumbrances. Company or any Subsidiary of Company has not
placed any Encumbrances on the record title of Company or any Subsidiary of Company as to any Owned Property since the issuance of such policies. 
 (b) Each of Company and its Subsidiaries, as applicable, has a valid, binding and enforceable leasehold interest under each of the Real Property Leases under which it is a lessee, free and clear of all Encumbrances other than Permitted
Encumbrances. Each of the Real Property Leases is in full force and effect. Neither Company nor any Subsidiary is in default in 

  

 28 

 
any material respect under any Real Property Lease, and no event has occurred and no circumstance exists which, if not remedied, and whether with or without
notice or the passage of time or both, would result in such a material default. Neither Company nor any Subsidiary has received or given any notice of any default or event that with notice or lapse of time, or both, would constitute a material
default by Company or any Subsidiary under any of the Real Property Leases and, to the Knowledge of Company, no other party is in material default thereof and no party to any Real Property Lease has exercised any termination rights with respect
thereto. 
 (c) There does not exist any actual or, to the Knowledge of Company, threatened or contemplated condemnation or eminent domain
proceedings that would render it economically unfeasible to use any Company Property as Company uses such Company Property (or as Company intends to use such Company Property), and none of Company, and Subsidiary or any Major Shareholder has
received any notice, oral or written, of the intention of any Governmental Entity or other Person to take or use all or any part thereof. 
 Section 4.12 Tangible Personal Property. 
 (a) Company and its Subsidiaries have good and marketable title to all of the
material items of tangible personal property reasonably necessary to operate the business of Company and its Subsidiaries (except as sold or disposed of subsequent to the date thereof in the Ordinary Course of Business and not in violation of this
Agreement), free and clear of any and all Encumbrances, other than the Permitted Encumbrances. 
 (b) Schedule 4.12(b) sets forth all
leases of personal property (“Personal Property Leases”) involving annual payments in excess of $25,000 relating to personal property reasonably necessary to operate the business of Company or any of its Subsidiaries to which
Company or any of its Subsidiaries is a party or by which the properties or assets of Company or any of its Subsidiaries is bound. Company has delivered to Parent true, correct and complete copies of the Personal Property Leases, together with all
amendments, modifications or supplements thereto. 
 (c) Company and each of its Subsidiaries has a valid and enforceable leasehold interest
under each of the Personal Property Leases under which it is a lessee. Each of the Personal Property Leases is in full force and effect and neither Company nor any Subsidiary has received or given any notice of any default or event that with notice
or lapse of time, or both, would constitute a default by Company or any Subsidiary under any of the Personal Property Leases and, to the Knowledge of Company, no other party is in default thereof, and no party to the Personal Property Leases has
exercised any termination rights with respect thereto. 
 Section 4.13 Intellectual Property. 
 (a) Company and its Subsidiaries own or have valid rights to use all Intellectual Property necessary to operate their respective businesses as currently
conducted. There are no pending or, to the Knowledge of Company, threatened claims that (i) Company or its Subsidiaries is in violation of, infringing upon, diluting or misappropriating any Intellectual Property rights of any third Person or
(ii) challenge the validity, enforceability or ownership of 

  

 29 

 
any Intellectual Property owned by Company or its Subsidiaries. Except for any rights granted by Company to dealers, suppliers and vendors in the Ordinary
Course of Business relating to the use of Company Intellectual Property, no other Person has any rights to any of the material Intellectual Property owned by Company or its Subsidiaries. To the Knowledge of Company, no third Person is infringing,
violating, diluting, or misappropriating any of the Intellectual Property owned by Company or its Subsidiaries. 
 (b) Schedule
4.13(b) lists an accurate and complete list of all registrations and applications for registration of patents, trademarks, service marks, copyrights and Internet domain names owned by Company or its Subsidiaries throughout the world, including
the jurisdiction and owner of each application or registration. 
 (c) Company and its Subsidiaries own or have valid and continuing rights
pursuant to written license agreements to use and otherwise exploit all material Software used in or necessary for the operation of their respective businesses as currently conducted. Company or one of its Subsidiaries is the sole and exclusive
owner of all right, title and interest in and to all Software developed or created by any Employees or officers of Company or any of its Subsidiaries or by any consultants or contractors of Company or any of its Subsidiaries for or on behalf of
Company or such Subsidiary. 
 (d) To the Knowledge of Company, no other person has asserted that Company or its Subsidiaries do not have the
lawful right to use all Intellectual Property as it is currently used by Company or any of its Subsidiaries on any Private Label Products or otherwise in the operation of its business. “Private Label Products” means any products or
services marketed, sold, offered for sale, distributed or otherwise exploited by Company or any of its Subsidiaries under any trademark, service mark, corporate name, logo or trade name owned by Company or any of its Subsidiaries. 
 Section 4.14 Material Contracts. 
 (a) Schedule 4.14(a) sets forth, by reference to the applicable subsection of this Section 4.14(a), all of the following Contracts to which Company or any of its Subsidiaries is a party or by which any of them or their
respective assets of properties are bound (collectively, the “Material Contracts”): 
 (i) Contracts with any
Major Shareholder or Affiliate thereof or any current or former officer, director or Affiliate of Company or any of its Subsidiaries; 
 (ii) Contracts for the sale of any of the assets of Company or any of its Subsidiaries other than in the Ordinary Course of Business or for the grant to any Person of any preferential rights to purchase any of its
assets; 
 (iii) Contracts for joint ventures, strategic alliances, partnerships, licensing arrangements, or sharing of
profits or proprietary information; 
 (iv) Contracts containing covenants of Company or any of its Subsidiaries not to
compete in any line of business or with any Person in any geographical area or not to 

  

 30 

 
solicit or hire any person with respect to employment or covenants of any other Person not to compete with Company or any of its Subsidiaries in any line of
business or in any geographical area or not to solicit or hire any person with respect to employment; 
 (v) Contracts
relating to the acquisition (by merger, purchase of stock or assets or otherwise) by Company or any of its Subsidiaries of any operating business or material assets or the capital stock of any other Person; 
 (vi) Contracts relating to the incurrence, assumption or guarantee of any Indebtedness or imposing an Encumbrance on any of the assets of
Company or any Subsidiary, including indentures, guarantees, loan or credit agreements, sale and leaseback agreements, purchase money obligations incurred in connection with the acquisition of property, mortgages, pledge agreements, security
agreements, or conditional sale or title retention agreements; 
 (vii) all Contracts obligating Company or any of its
Subsidiaries to provide or obtain products of services for a period of one year or more or requiring Company to purchase or sell a stated portion of its requirements or outputs; 
 (viii) Contracts under which Company or any of its Subsidiaries has made advances or loans to any other Person; 
 (ix) Contracts providing for severance, retention, change in control or other similar payments; 
 (x) Contracts for the employment of any individual on a full-time, part-time or consulting or other basis; 
 (xi) material management Contracts and Contracts with independent contractors or consultants (or similar arrangements) that are not
cancelable without penalty or further payment and without more than 30 days’ notice; 
 (xii) outstanding Contracts of
guaranty, surety or indemnification, direct or indirect, by Company or any of its Subsidiaries; 
 (xiii) Contracts under
which Company or any of its Subsidiaries has any obligation to repurchase, or sell or issue, any securities; and 
 (xiv)
Contracts that are otherwise material to Company and its Subsidiaries. 
 (b) Each of the Material Contracts is in full force and effect and
is the legal, valid and binding obligation of Company or any of its Subsidiaries which is party thereto, enforceable against Company or any of its Subsidiaries, as applicable, in accordance with its terms. Neither Company nor any of its Subsidiaries
is in material default under any Material Contract, nor, to the Knowledge of Company, is any other party to any Material Contract in material breach of or material default thereunder, and no event has occurred and is continuing that with the lapse
of time or the giving of notice or both would constitute a material breach or material default on 

  

 31 

 
Company, any Subsidiary or, to the Knowledge of Company, any other party thereunder. No party to any of the Material Contracts has exercised any termination
rights with respect thereto, and no party has given written notice of any significant dispute with respect to any Material Contract. Company has delivered to Parent true, correct and complete copies of all of the Material Contracts, together with
all amendments, modifications or supplements thereto. 
 Section 4.15 Employee Benefits Plans. 
 (a) Schedule 4.15(a) sets forth a correct and complete list of: (i) all “employee benefit plans” (as defined in Section 3(3) of
ERISA), and all other employee benefit plans, programs, agreements, policies, arrangements or payroll practices, including bonus plans, employment, consulting or other compensation agreements, collective bargaining agreements, incentive, equity or
equity-based compensation, or deferred compensation arrangements, change in control, termination or severance plans or arrangements, stock purchase, severance pay, sick leave, vacation pay, salary continuation for disability, hospitalization,
medical insurance, life insurance and scholarship plans and programs, whether written or oral, maintained by Company or any of its Subsidiaries or to which Company or any of the Subsidiaries contributed or is obligated to contribute thereunder for
the Employees (collectively, the “Company Plans”). Company has made available to Parent with respect to each Company Plan, a true, correct and complete copy (or to the extent no such copy exists, an accurate description) thereof,
together with all amendments thereto, and, to the extent applicable: (i) any related trust documents, insurance contracts or other funding arrangements, and amendments thereto; (ii) the most recent Forms 5500 and all schedules thereto and
the most recent actuarial report, if any; (iii) the most recent IRS determination letter; (iv) summary plan descriptions; and (v) written communications to Employees relating to the Company Plans. 
 (b) Neither Company nor any of its Subsidiaries, nor any of their Affiliates or any trade or business (whether or not incorporated) that is or has ever
been under their common control or that is or has ever been treated as a single employer with any of them under Section 414(b), (c), (m) or (o) of the Code (each, an “ERISA Affiliate”), contributes to or has in the
past six years sponsored, maintained, contributed to or had any liability in respect of any “defined benefit pension plan” (as defined in Section 3(35) of ERISA) or plan subject to Section 412 of the Code or Section 302 of
ERISA including any “multiemployer plan” (as defined in Section 3(37) of ERISA). 
 (c) The Company Plans have been maintained
in all material respects in accordance with their terms and with all provisions of ERISA, the Code (including rules and regulations thereunder) and other applicable federal and state Laws and regulations, and neither Company (or any of the
Subsidiaries) nor, to the Knowledge of Company, any “party in interest” or “disqualified person” with respect to the Company Plans has engaged in a non-exempt “prohibited transaction” within the meaning of
Section 4975 of the Code or Section 406 of ERISA. Neither Company, any officer of Company, nor, to the Knowledge of Company, any fiduciary, has any liability for breach of fiduciary duty or other failure to act or comply in connection with
the administration or investment of the assets of any Company Plan that would have a material adverse impact on Company, any Company Plan, or any officer of Company. 
  

 32 

 (d) The Company Plans intended to qualify under Section 401 of the Code are so qualified and any
trusts intended to be exempt from federal income taxation under Section 501 of the Code are so exempt, and nothing has occurred with respect to the operation of the Company Plans that could cause the loss of such qualification or exemption or
the imposition of any liability, penalty or Tax under ERISA or the Code. All amendments and actions required to bring the Company Plans into conformity in all material respects with all of the applicable provisions of the Code, ERISA and other
applicable Laws have been made or taken. 
 (e) All contributions (including all employer contributions and employee salary reduction
contributions) required to have been made under any of the Company Plans (including workers compensation) or by Law (without regard to any waivers granted under Section 412 of the Code), to any funds or trusts established thereunder or in
connection therewith have been made by the due date thereof (including any valid extension), and all contributions for any period ending on or before the Closing Date that are not yet due will have been paid or sufficient accruals for such
contributions and other payments in accordance with GAAP are duly and fully provided for on the Balance Sheet. No accumulated funding deficiencies exist in any of the Company Plans. 
 (f) There are no pending actions, claims or lawsuits that have been asserted or instituted against the Company Plans, the assets of any of the trusts
under the Company Plans or the sponsor or administrator of any of the Company Plans, or, to Company’s Knowledge, against any fiduciary of the Company Plans with respect to the operation of any of the Company Plans (other than routine benefit
claims), nor does Company have any Knowledge of facts that could form the basis for any such claim or lawsuit. No individual who has performed services for Company or any of the Subsidiaries has been improperly excluded from participation in any
Company Plan. 
 (g) None of the Company Plans provides for post-employment life or health insurance, benefits or coverage for any
participant or any beneficiary of a participant, except as may be required under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), and at the expense of the participant or the participant’s
beneficiary. 
 (h) Neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby will
(either alone or in combination with another event) (i) result in any payment becoming due, or increase the amount of any compensation due, to any Employee; (ii) increase any benefits otherwise payable under any Company Plan;
(iii) result in the acceleration of the time of payment or vesting of any such compensation or benefits; or (iv) result in the triggering or imposition of any restrictions or limitations on the rights of Company or any of the Subsidiaries
to amend or terminate any Company Plan. Neither Company nor any of the Subsidiaries have any plan, contract or commitment, whether legally binding or not, to create any additional employee benefit compensation plans, policies or arrangements or,
except as may be required by applicable law, to modify any Company Plan. None of Company or any of the Subsidiaries has made any payments, is obligated to make any payments, or is a party to any agreement that under certain circumstances (either
alone or in combination with another event) could obligate it to make any payments that will not be deductible under Section 280G of the Code. 
  

 33 

 (i) Any individual who performs services for Company or any of the Subsidiaries (other than through a
contract with an organization other than such individual) and who is not treated as an employee of Company or any of the Subsidiaries for federal income Tax purposes by Company or any of the Subsidiaries is not an employee for such purposes. Neither
Company nor any of the Subsidiaries has any direct or indirect liability, whether absolute or contingent, with respect to any misclassification of any person as an independent contractor rather than as an Employee, as a part-time Employee rather
than a full-time Employee, or with respect to any Employee leased from another employer. As of the date hereof, no Employee of Company or any of the Subsidiaries, at the officer level or above, has given written notice to Company or any of the
Subsidiaries that any such Employee intends to terminate his or her employment with Company or any of the Subsidiaries. To the Knowledge of Company, no Employee of Company or any of the Subsidiaries is in any material respect in violation of any
material term of any employment contract, non-disclosure agreement or noncompetition agreement. 
 Section 4.16 Labor.

 (a) Within the last three years, neither Company nor any of its Subsidiaries is or has been a party to any labor union contract or
collective bargaining agreement and there are no and have not been any labor union contracts or collective bargaining agreements which pertain to Employees of Company or any of its Subsidiaries. 
 (b) No Employees are represented by any union organization. No union organization or group of Employees has made a pending demand for recognition to
Company or any of its Subsidiaries or the National Labor Relations Board with respect to any Employee, and to the Knowledge of Company, there are no representation proceedings or petitions seeking such a representation proceeding presently pending
or threatened to be brought or filed, with the National Labor Relations Board or other labor relations tribunal. Company has no Knowledge of any organizing activity involving Company or any of its Subsidiaries pending or threatened by any labor
organization or group of Employees. 
 (c) There are no (i) strikes, work stoppages, slowdowns, lockouts or arbitrations or
(ii) material grievances or other material labor disputes pending or, to the Knowledge of Company, threatened against or involving Company or any of its Subsidiaries. There are no unfair labor practice charges, grievances or complaints pending
with any Governmental Entity or, to the Knowledge of Company, threatened to be filed with any Governmental Entity by or on behalf of any Employee or group of Employees. 
 (d) There are no complaints or charges against Company or any of its Subsidiaries pending or, to Knowledge of Company, threatened to be filed with any Governmental Entity based upon, attributable to or resulting from
the employment or termination of employment of or failure to employ, any individual. There has been no “mass layoff” or “plant closing” (as defined by the Worker Adjustment Retraining Notification Act of 1988, as
amended) with respect to Company or any of its Subsidiaries within the six (6) months prior to Closing. 
 Section 4.17
Litigation. There is no Legal Proceeding pending or, to the Knowledge of Company, threatened against Company or any of its Subsidiaries (or to the Knowledge of Company, pending or threatened, against any of the officers, directors or
Employees of Company 

  

 34 

 
or any of its Subsidiaries with respect to their business activities on behalf of Company), or to which Company or any of its Subsidiaries is otherwise a
party before any Governmental Entity. Neither Company nor any Subsidiary is subject to any Order, and neither Company nor any Subsidiary is in material breach or violation of any Order. There are no Legal Proceedings pending or, to the Knowledge of
Company, threatened against Company or to which Company is otherwise a party relating to this Agreement or, any Company Document or the transactions contemplated hereby or thereby. 
 Section 4.18 Compliance with Laws; Permits. 
 (a) Company and its Subsidiaries are in compliance in all material respects with all Laws applicable to its business, operations or assets. Neither Company nor any Subsidiary has received any notice of or been charged
with the material violation of any Laws. To the Knowledge of Company, neither Company nor any Subsidiary is under investigation with respect to the material violation of any Laws. 
 (b) Schedule 4.18 contains a list of all Permits which are required for the operation of the business of Company and its Subsidiaries as presently
conducted and as presently intended to be conducted (“Company Permits”), other than those the consequences of the failure to possess is immaterial. Company and its Subsidiaries currently have all Permits which are required for the
operation of their respective businesses as presently conducted and as presently intended to be conducted, other than those the consequences of the failure to possess is immaterial. 
 Section 4.19 Environmental Matters. 
 (a) Company has provided Purchaser with (1) information in the Electronic Data Room from which it can determine Company’s current inventory of underground storage tanks, including the size, age and material of the underground
storage tanks and nature of leak detection, which information, to the Knowledge of Company, is correct in all material respects, and (2) access to Company’s internet-based system (known as “Titan”) for tracking the
underground storage tanks currently located on Company Property. To Company’s Knowledge, the information contained in Titan concerning its underground storage tanks is correct in all material respects. 
 (b) Schedule 4.19(b) identifies the third party environmental liability insurance currently carried by Company that insures Company for liability
relating to its underground storage tanks. Such insurance is in amounts that meet or exceed the amounts required by Environmental Laws. 
 (c) Except as would not reasonably be expected to result in Company incurring material Environmental Costs and Liabilities, neither Company nor any of its Subsidiaries is the subject of any outstanding written Order or Contract with any
Governmental Entity or Person with respect to (i) Environmental Laws, (ii) Remedial Action or (iii) any Release or threatened Release of a Hazardous Material, including without limitation any obligation on the part of Company or any
of its Subsidiaries to indemnify or otherwise reimburse any Person for any Environmental Costs and Liabilities at any Company Property or any property formerly owned, operated or leased by Company or any of its Subsidiaries. 
  

 35 

 (d) Schedule 4.19(d)(1) lists any and all of the Company Properties at which there is a known
Release of Hazardous Materials for which a no further action letter or similar documentation indicating that no further Remedial Action, monitoring or investigation is required (“NFA”) has not been issued by the relevant
Governmental Entity except where such Release or the lack of a NFA is not reasonably likely to result in a Material Adverse Effect and, Schedule 4.19(d)(2) sets forth by site, each Company Property or any property formerly owned, operated or
leased by Company or any of its Subsidiaries at which a Release has been reported to a Governmental Authority by Company. To the Knowledge of Company, the costs of remediating any Release listed on Schedule 4.19(d)(1) will not exceed the
limits of coverage available from applicable government trust funds or insurance. To the Knowledge of Company, (x) no Release from Company’s operation or at any real property currently owned, operated or leased by Company has migrated
offsite unless Company has received a NFA for the specific Release and (y) Company has not received written notice of any claim by a property owner or other person adjacent to Company Properties related to a Release originating from either
Company’s underground storage tanks or any real property currently owned, operated or leased by Company. 
 (e) The operations and
assets of Company and each of its Subsidiaries are and, except for instances of non-compliance that have been resolved, have been in material compliance with all applicable Environmental Laws, which compliance includes obtaining, maintaining in good
standing and materially complying with all required Environmental Permits and no action or proceeding is pending or, to the Knowledge of Company, threatened to revoke, modify or terminate any such Environmental Permit. 
 (f) All of the underground storage tanks currently located on any Company Property are, and all underground storage tanks located any property formerly
owned, operated or leased by Company or its Subsidiaries were at the time of Company’s ownership, operation or tenancy, were, registered pursuant to the requirements of (x) 30 Texas Administrative Code, Chapter 334 (as to Company
Properties located in the State of Texas) or (y) 20 New Mexico Annotated Code, Chapter 5 (as to Company Properties located in the State of New Mexico). 
 (g) No written claim is pending, or to the Knowledge of Company, threatened against Company or any of its Subsidiaries alleging either or both that Company or any of its Subsidiaries may be in violation of or may have
any liability under any Environmental Law or Environmental Permit. 
 (h) To the Knowledge of Company, there are no pending or threatened
investigations arising under Environmental Law of the business, assets, operations, or Company Property or previously owned, operated or leased property of Company or any of its Subsidiaries which could lead to the imposition of any material
Environmental Costs and Liabilities or Encumbrances under Environmental Law. 
 (i) No facts, circumstances or conditions exist with respect
to Company or any of its Subsidiaries or any Company Property or any property currently or formerly owned, operated or leased by Company or any of its Subsidiaries or any property to which Company or any of its Subsidiaries arranged for the disposal
or treatment of Hazardous Materials, including but not limited to a Release of Hazardous Materials, that could reasonably be expected to result in 

  

 36 

 
Company or any of its Subsidiaries incurring unbudgeted material Environmental Costs and Liabilities; and 
 (j) There has been no Release from any vehicle owned, operated or leased by Company or any of its Subsidiaries for the transportation of Hazardous
Materials in violation of Environmental Laws or at concentrations likely to give rise to material Environmental Costs and Liabilities. 
 Section 4.20 Insurance. Company and its Subsidiaries have insurance policies in full force and effect for such amounts as are sufficient for all requirements of Law and all agreements to which Company or any of its Subsidiaries
is a party or by which it is bound. Set forth in Schedule 4.20 is a list of all insurance policies and all fidelity and surety bonds held by or applicable to Company or any of its Subsidiaries. No such insurance policies, fidelity or surety
bond requires Company to provide any collateral. To the Knowledge of Company, no event relating to Company or any of its Subsidiaries has occurred which could reasonably be expected to result in a retroactive upward adjustment in premiums under any
such insurance policies or which could reasonably be expected to result in a prospective material upward adjustment in such premiums. Excluding insurance policies that have expired and been replaced in the Ordinary Course of Business, no insurance
policy has been cancelled within the last two years and, to the Knowledge of Company, no threat has been made to cancel any insurance policy of Company or any of its Subsidiaries during such period. To the Knowledge of Company, all such insurance
will remain in full force and effect immediately following the consummation of the transactions contemplated hereby. 
 Section 4.21
Related Party Transactions. No officer or director of Company or any of its Subsidiaries or any holder of 5% or more of Company Common Stock, any member of his or her immediate family or any of their respective Affiliates (“Related
Persons”) (i) owes any amount to Company or any of its Subsidiaries nor does Company or any of its Subsidiaries owe any amount to, or has Company or any of its Subsidiaries committed to make any loan or extend or guarantee credit to or
for the benefit of, any Related Person, (ii) is involved in any business arrangement or other relationship with Company or any of its Subsidiaries (whether written or oral), other than employment arrangements disclosed to Parent,
(iii) owns any property or right, tangible or intangible, that is used by Company or any of its Subsidiaries, (iv) has any claim or cause of action against Company or any of its Subsidiaries (other than for payment of compensation in the
ordinary course or indemnity rights applicable to similarly situated officers or directors generally) or (v) owns any direct or indirect interest of any kind in, or controls or is a director, officer, Employee or partner of, or consultant to,
or lender to or borrower from or has the right to participate in the profits of, any Person which is a competitor, supplier, customer, landlord, tenant, creditor or debtor of Company or any Subsidiary. 
 Section 4.22 Banks; Power of Attorney. Schedule 4.22 contains a complete and correct list of the names and locations of all banks in
which Company or any Subsidiary has accounts or safe deposit boxes and the names of all persons authorized to draw thereon or to have access thereto. No person holds a power of attorney to act on behalf of Company or any Subsidiary. 
 Section 4.23 Issuances and Repurchases of Securities. All shares of Company Common Stock and any other securities issued or sold by Company
with respect to which the 

  

 37 

 
applicable statute of limitations has not expired for any claims in connection with such issuances or sales by Company were issued or sold pursuant to valid
exemptions from the Securities Act, and any applicable “blue sky” or state securities regulations, and otherwise in accordance with applicable Laws. All shares of Company Common Stock, or any other securities of Company, that have
been redeemed or otherwise purchased by Company have been so redeemed or purchased in accordance with all applicable Laws and the terms of any applicable plans or Contracts pursuant to which any such redemption or repurchase was accomplished and no
Person has any valid claim against Company or any of its Affiliates arising from or in connection with any such redemption or purchase. 
 Section 4.24 Full Disclosure. To the Knowledge of Company, no representation or warranty of Company or Major Shareholders contained in this Agreement or in any of the Major Shareholder Documents contains an untrue statement of a
material fact or omits to state a material fact necessary to make the statements contained herein or therein not misleading. 
 Section 4.25 Financial Advisors. Except for Houlihan Lokey, Morgan, Keegan & Co, Inc. and Trefethen & Company, LLC, no Person has acted, directly or indirectly, as a broker, finder or financial advisor for the
Major Shareholders, Company or any Subsidiary in connection with the transactions contemplated by this Agreement and no Person is or will be entitled to any fee or commission or like payment in respect thereof. 
 Section 4.26 Opinion of Financial Advisor. The Board of Directors of Company has received the opinion of Houlihan, Lokey, dated as of the
date of this Agreement, to the effect that, as of the date hereof, the Closing Purchase Price is fair to the shareholders of Company from a financial point of view. 
 ARTICLE V 
 REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB 
 Parent and Merger Sub represent and warrant to Company as set forth below: 
 Section 5.1 Organization and Good Standing. Merger Sub is a corporation duly organized, validly existing and in good standing under the laws of the State of Texas and has all requisite corporate power and
authority to own, lease and operate properties and carry on its business as now conducted and as currently proposed to be conducted and is an indirect wholly-owned subsidiary of Parent. Parent is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and has all requisite corporate power and authority to own, lease and operate properties and carry on its business as now conducted and as currently proposed to be conducted. 
 Section 5.2 Authorization of Agreement. Parent and Merger Sub have full corporate power and authority to execute and deliver this Agreement
and each other agreement, document, instrument or certificate contemplated by this Agreement or to be executed by Merger Sub or Parent in connection with the consummation of the transactions contemplated hereby and thereby (the “Merger Sub
Documents”), and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by Merger Sub and Parent of this Agreement 

  

 38 

 
and each Merger Sub Document have been duly authorized by all necessary corporate action on behalf of Merger Sub and Parent. This Agreement has been, and
each Merger Sub Document will be at or prior to the Closing, duly executed and delivered by Merger Sub and Parent and (assuming the due authorization, execution and delivery by the other parties hereto and thereto) this Agreement constitutes, and
each Merger Sub Document when so executed and delivered will constitute, the legal, valid and binding obligation of Merger Sub or Parent, enforceable against Merger Sub or Parent, as applicable, in accordance with its respective terms. 

Section 5.3 Conflicts; Consents of Third Parties. 
 (a) Assuming that all consents, approvals, authorizations and Permits described in Section 5.3(b) have been obtained and all filings and notifications described in Section 5.3(b) have been made
and any waiting periods thereunder have terminated or expired, none of the execution and delivery by Merger Sub or Parent of this Agreement and of the Merger Sub Documents, the consummation of the transactions contemplated hereby or thereby, or the
compliance by Merger Sub with any of the provisions hereof or thereof will conflict with, or result in violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination or cancellation under any
provision of (i) the certificate of incorporation and by-laws or comparable organizational documents of the Merger Sub or Parent; (ii) any material Contract, or material Permit to which Merger Sub or Parent is a party or by which any of
the properties or assets of Merger Sub or Parent are bound; (iii) any Order of any Governmental Entity applicable to Merger Sub or Parent or by which any of the properties or assets of Merger Sub or Parent are bound; or (iv) any applicable
Law, except in the case of clauses (i) through (iv), where such conflicts, violations, breaches, defaults, losses or rights would not cause a materially adverse impact on the ability of Parent or Merger Sub to perform its obligations under this
Agreement. 
 (b) No consent, waiver, approval, Order, Permit or authorization of, or declaration or filing with, or notification to, any
Person or Governmental Entity is required on the part of Parent in connection with the execution and delivery of this Agreement or the Merger Sub Documents or the compliance by Parent with any of the provisions hereof or thereof, except for
(i) compliance with the applicable requirements of the HSR Act, (ii) the filing of the Articles of Merger with the Secretary of State of the State of Texas pursuant to the TBCA and Section 2.1 hereof, (iii) Alcohol Filings,
(iv) Lottery Filings and (v) Storage Tank Filings. 
 Section 5.4 Financial Advisors. Except for Merrill
Lynch & Co., no Person has acted, directly or indirectly, as a broker, finder or financial advisor for Merger Sub or Parent in connection with the transactions contemplated by this Agreement and no Person is entitled to any fee or
commission or like payment in respect thereof. 
 ARTICLE VI 
 REPRESENTATIONS AND WARRANTIES 
 OF THE SHAREHOLDER REPRESENTATIVE 
 Section 6.1 Due Execution; Binding Effect. This Agreement has been duly executed and delivered by the Shareholder Representative and the
Escrow Agreement will be duly 

  

 39 

 
executed and delivered by the Shareholder Representative at the Closing. This Agreement constitutes, and the Escrow Agreement will constitute at the Closing,
the legal, valid and binding obligation of the Shareholder Representative, enforceable against the Shareholder Representative, each in accordance with its terms (assuming the due authorization, execution and delivery by the other parties hereto and
thereto). 
 Section 6.2 Non-Contravention. The execution, delivery and performance by the Shareholder Representative of this
Agreement and the Escrow Agreement, in accordance with their respective terms will not result in any violation of or default or creation of any Encumbrance under, or the acceleration or vesting or modification of any right or obligation under or in
any way be in conflict with any Order, Law or Contract binding on or applicable to the Shareholder Representative. 
 ARTICLE VII 

CONDUCT OF BUSINESS PRIOR TO EFFECTIVE TIME 
 Company covenants and agrees that, from and after the date of this Agreement and until the Closing, except as otherwise specifically consented to or approved by Parent in writing, Company shall comply with the following covenants:

 Section 7.1 Access to Information; Confidentiality. Company shall, and Company shall cause its Subsidiaries to, afford to
Parent and its accountants, counsel, financial advisors and other representatives, and to prospective lenders, placement agents and other financing sources and each of their respective representatives, reasonable access, during normal business hours
upon reasonable notice throughout the period prior to the Closing, to Company’s and its Subsidiaries’ respective properties and facilities (including all owned or leased real property and the buildings, structures, fixtures, appurtenances
and improvements erected, attached or located thereon), books, financial information (including working papers and data in the possession of Company’s or its Subsidiaries’ or their respective independent public accountants, internal audit
reports, and “management letters” from such accountants with respect to Company’s or any of its Subsidiaries’ systems of internal control), Contracts and records of Company and its Subsidiaries and, during such period,
shall furnish promptly such information concerning the businesses, properties and personnel of Company and its Subsidiaries as Parent shall reasonably request; provided, however, such investigation shall not unreasonably disrupt
Company’s operations. Company shall authorize and direct the appropriate directors, managers and employees of each such Subsidiary to discuss matters involving the operations and business of Company or such Subsidiary, as the case may be, with
representatives of Parent and its prospective lenders or placement agents and other financial sources. All nonpublic information provided to, or obtained by, Parent or Merger Sub in connection with the transactions contemplated hereby shall be
“Confidential Information” for purposes of the Confidentiality Agreement dated June 23, 2007 among Parent and Town and Country Food Stores, Inc. (the “Confidentiality Agreement”), the terms of which shall
continue in force until the Closing; provided that Parent, Merger Sub and Company may disclose such information as may be necessary in connection with (i) seeking necessary consents and approvals as contemplated hereby, (ii) the
financing of the transactions contemplated hereby and (iii) making such disclosures as required under applicable Law 

  

 40 

 
including the Securities Exchange Act of 1934, as amended, or by the applicable rules of any stock exchange on which Parent lists securities. Notwithstanding
the foregoing, Company and its Subsidiaries shall not be required to disclose any information if such disclosure would contravene any applicable Law. 
 Section 7.2 Conduct of the Business Pending the Closing. 
 (a) Except as otherwise expressly
provided in this Agreement or with the prior written consent of Parent, between the date hereof and the Closing, Company shall, and Company shall cause its Subsidiaries to: 
 (i) conduct the respective businesses of Company and its Subsidiaries only in the Ordinary Course of Business; 
 (ii) use their commercially reasonable efforts to preserve the respective present business operations, organization (including officers
and Employees) and goodwill of Company and its Subsidiaries. 
 (b) Without limiting the generality of the foregoing, except as otherwise
expressly provided in this Agreement or with the prior written consent of Parent, the Major Shareholders and Company shall not, and Company shall cause its Subsidiaries not to: 
 (i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of, or other ownership interests
in, Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, Company, except to the extent taken into account in determining the Closing Purchase Price;

 (ii) other than any transfer by a Major Shareholder for charitable or estate planning purposes of such Major Shareholder,
transfer for its own account, issue, sell, pledge, encumber or dispose of any shares of capital stock or other securities of, or other ownership interests in, Company or any of its Subsidiaries or grant options, warrants, calls or other rights to
purchase or otherwise acquire shares of the capital stock or other securities of, or other ownership interests in, Company or any of its Subsidiaries; 
 (iii) effect any recapitalization, reclassification, stock split, combination or like change in the capitalization of Company or any of its Subsidiaries, or amend the terms of any outstanding securities of Company or
any Subsidiary; 
 (iv) amend the articles of incorporation or by-laws or equivalent organizational or governing documents of
Company or any of its Subsidiaries; 
 (v) other than in the Ordinary Course of Business, (A) increase the salary or
other compensation of any director, officer or Employee of Company or any of its Subsidiaries, except for normal year-end increases, (B) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any director,
officer, Employee or consultant (other than the payment of $250,000 of bonuses to 

  

 41 

 
Employees in excess of the amount accrued therefor on the income statement of Company dated June 2, 2007), (C) increase the coverage or benefits
available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee
benefit plan or arrangement made to, for, or with any of the directors, officers, representatives or Employees of Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (D) enter into any
employment, deferred compensation, severance, special pay, consulting, non-competition or similar agreement or arrangement with any directors or officers of Company or any Subsidiary (or amend any such agreement to which Company or any of its
Subsidiaries is a party); 
 (vi) issue, create, incur, assume, guarantee, endorse or otherwise become liable or responsible
with respect to (whether directly, contingently or otherwise) any Indebtedness; or (ii) modify the terms of any Indebtedness or other Liability; 
 (vii) acquire any material properties or assets or sell, assign, license, transfer, convey, lease or otherwise dispose of any of the material properties or assets of, or used by, Company and its Subsidiaries, other
than in the Ordinary Course of Business; 
 (viii) enter into or agree to enter into any merger or consolidation with any
corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to, or otherwise acquire the securities, of any other Person; 
 (ix) cancel or compromise any debt or claim or waive or release any material right of Company or any of its Subsidiaries except in the
Ordinary Course of Business; 
 (x) enter into any commitment for capital expenditures of Company and its Subsidiaries in
excess of $300,000 for any individual commitment and $1,000,000 for all commitments in the aggregate unless such commitment is consistent with the 2007 and 2008 capital expenditure plans as previously disclosed to Parent; 
 (xi) enter into any labor or collective bargaining agreement of Company or any of its Subsidiaries or, through negotiation or otherwise,
make any commitment or incur any liability to any labor organization with respect to Company or any of its Subsidiaries; 
 (xii) enter into any transaction or enter into, modify or renew any Contract which by reason of its size, nature or otherwise is not in the Ordinary Course of Business; 
 (xiii) make a change in its accounting or Tax reporting principles, methods or policies; 
 (xiv) make, change or revoke any Tax election, settle or compromise any Tax claim or liability or enter into a settlement or compromise,
or change (or make a request to any Taxing Authority to change) any material aspect of its method of accounting for Tax purposes; 
  

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 (xv) enter into any Contract, understanding or commitment that restrains, restricts,
limits or impedes the ability of Company or any Subsidiary to (A) compete with or conduct any business or line of business in any geographic area or (B) solicit the employment of any persons; 
 (xvi) terminate (prior to stated maturity), amend, restate, supplement or waive any rights under any (A) Material Contract, Real
Property Lease, Personal Property Lease or Intellectual Property license, other than in the Ordinary Course of Business or (B) Permit; 
 (xvii) take any action which would adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement; and 
 (xviii) agree to do anything (A) prohibited by this Section 7.2, (B) which would make any of the representations and
warranties of Company or the Major Shareholders in this Agreement or any of the Major Shareholder Documents or Company Documents untrue or incorrect in any material respect or could result in any of the conditions to the Closing not being satisfied
or (C) that would be reasonably expected to have a Material Adverse Effect. 
 Section 7.3 Third Party Consents. The Major
Shareholders and Company shall use, and Company shall cause its Subsidiaries to use, their commercially reasonable efforts to obtain at the earliest practicable date all consents, waivers and approvals from, and provide all notices to, all Persons
that are not a Governmental Entity, which consents, waivers, approvals and notices are required to consummate the transactions contemplated by this Agreement, including the consents, waivers, approvals and notices referred to in Sections
3.2(b) and 4.3(b) hereof (except for such matters covered by Section 7.4). All such consents, waivers, approvals and notices shall be in writing and in form and substance reasonably satisfactory to Parent, and executed
counterparts of such consents, waivers and approvals shall be delivered to Parent promptly after receipt thereof, and copies of such notices shall be delivered to Parent promptly after the making thereof. Notwithstanding anything to the contrary in
this Agreement, neither Parent nor any of its Affiliates (which for purposes of this sentence shall include Company) shall be required to pay any amounts in connection with obtaining any consent, waiver or approval. 
 Section 7.4 Governmental Consents and Approvals. 
 (a) Each of Merger Sub and Company shall use, and Company shall cause each of its Subsidiaries to use, its commercially reasonable efforts to obtain at the earliest practical date all consents, waivers, approvals,
Orders, Permits, authorizations and declarations from, make all filings with, and provide all notices to, all Governmental Entities that are required to consummate, or in connection with, the transactions contemplated by this Agreement, including
the consents, waivers, approvals, Orders, Permits, authorizations, declarations, filings and notices referred to in Sections 3.2(b)(i)-(iv) and 4.3(b)(ii)(A)-(E). Without limiting the foregoing, Merger Sub and Company shall
(i) make all filings required of each of them or any of their respective Subsidiaries or Affiliates under the HSR Act with respect to the transactions contemplated hereby as promptly as practicable and, in any event, within ten
(10) Business Days after the date of this Agreement in the case of all filings required under the HSR Act, (ii) make 

  

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the appropriate Alcohol Filings, Lottery Filings and Storage Tank Filings, (iii) comply at the earliest practicable date with any request under the HSR
Act or from any other Governmental Entity for additional information, documents, or other materials received by each of them or any of their respective Subsidiaries or Affiliates from the U.S. Federal Trade Commission (the “FTC”),
the Antitrust Division of the U.S. Department of Justice (the “Antitrust Division”) or any other Governmental Entity in respect of such filings or such transactions, and (iii) cooperate with each other in connection with any
such filing (including, to the extent permitted by applicable Law, providing copies of all such documents to the non-filing parties prior to filing and considering all reasonable additions, deletions or changes suggested in connection therewith) and
in connection with resolving any investigation or other inquiry of any of the FTC, the Antitrust Division or other Governmental Entity with respect to any such filing or any such transaction. Each such party shall use commercially reasonable efforts
to furnish to each other party hereto all information required for any application or other filing to be made pursuant to any applicable Law in connection with the transactions contemplated by this Agreement. Each such party shall promptly inform
the other parties hereto of any oral communication with, and provide copies of written communications with, any Governmental Entity regarding any such filings or any such transaction and permit the other party to review in advance any proposed
communication by such party to any Governmental Entity. No party hereto shall independently participate in any formal meeting with any Governmental Entity in respect of any such filings, investigation, or other inquiry without giving the other
parties hereto prior notice of the meeting and, to the extent permitted by such Governmental Entity, the opportunity to attend and/or participate. Subject to applicable Law, the parties hereto shall consult and cooperate with one another in
connection with the matters described in this Section 7.4, including in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any party hereto
relating to proceedings under the HSR Act. 
 (b) Each of Parent, Merger Sub and Company shall use commercially reasonable efforts to resolve
such objections, if any, as may be asserted by any Governmental Entity with respect to the transactions contemplated by this Agreement under any Law, including the HSR Act, the Sherman Act, as amended, the Clayton Act, as amended, the Federal Trade
Commission Act, as amended, and any other Laws that are designed to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade. Each of Parent, Merger Sub and Company shall use commercially reasonable
efforts to take such action as may be required to cause the expiration of the notice periods under the HSR Act with respect to such transactions as promptly as possible after the execution of this Agreement. Notwithstanding anything to the contrary
in this Agreement, neither Parent nor any of its Affiliates (which for purposes of this sentence shall include Company) shall be required, in connection with the matters covered by this Section 7.4, (i) to pay any amounts (other
than the payment of filing fees and expenses and fees of counsel), (ii) to commence or defend any litigation, (iii) to hold separate (including by trust or otherwise) or divest any of their respective businesses, product lines or assets,
(iv) to agree to any limitation on the operation or conduct of their or Company’s or any of its Subsidiaries’ respective businesses or (v) to waive any of the conditions set forth in Article 8 of this Agreement.

  

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 Section 7.5 No Solicitation; Superior Offer. 
 (a) Other than in accordance with Section 7.5(c), Company will not, and will cause its Subsidiaries and their officers, directors, employees,
representatives and agents not to, directly or indirectly, (i) solicit, initiate, or knowingly take any action to facilitate or encourage (including by furnishing information) the submission of any Acquisition Proposal, (ii) enter into or
participate in any communications or negotiations regarding, or deliver or make available to any Person any non-public information or grant access to its properties, books and records or personnel in response to, or in connection with, any inquiry,
expression of interest, proposal or offer that constitutes, or could reasonably be expected to lead to, an Acquisition Proposal, (iv) approve, endorse or recommend any Acquisition Proposal or (v) enter into any agreement in principle,
arrangement, understanding or Contract with respect to an Acquisition Proposal. Company shall notify Parent promptly upon receipt of any Acquisition Proposal or indication or inquiry by any Person that could reasonably lead to an Acquisition
Proposal. 
 (b) Notwithstanding the foregoing, in the event that, other than as a result of a violation of Section 7.5(a), any
Person submits to Company (and does not withdraw) an unsolicited Acquisition Proposal within twenty-one (21) days after the date of this Agreement that the Board of Directors of Company (the “Company Board”) concludes in good
faith (after consultation with its outside legal counsel and financial advisor) is, or is reasonably likely to become, a Superior Offer, Company may, until the expiration of thirty-five (35) days after the date of this Agreement,
(i) engage in discussions or negotiations with such Person regarding such Acquisition Proposal, and (ii) deliver or make available to such Person non-public information regarding Company and its Subsidiaries provided that Company first
shall have received from such Person an executed confidentiality agreement containing terms at least as restrictive with regard to Company’s confidential information as the Confidentiality Agreement, it being understood that such
confidentiality agreement shall not include any provision for any exclusive right to negotiate with such Person or having the actual or purported effect of restricting Company from fulfilling its obligations under this Agreement; provided however,
that (x) Parent shall be entitled to promptly receive a copy of any such executed confidentiality agreement and (y) Company shall simultaneously provide or make available to Parent any confidential information supplied to any such Person
that has not previously been supplied or made available to Parent. 
 (c) For a period of thirty-five (35) days after the date of this
Agreement, nothing in this Agreement shall prevent the Company Board from terminating this Agreement pursuant to Section 13.1(g) simultaneously with the payment of the Company Termination Fee as a condition of such termination if
(A) Company shall not have violated any of the restrictions set forth in this Section 7.5, (B) within twenty-one (21) days after the date of this Agreement, a Person has made an Acquisition proposal and the Company Board
has made the determination described in Section 7.5(b), (C) a Superior Offer is made by such Person to Company and is not withdrawn, (D) Company shall have promptly provided written notice to Parent (a “Notice of
Superior Offer”) advising Parent that Company has received a Superior Offer and that it intends (or may intend) to terminate the Agreement pursuant to Section 13.1(g) and the manner and timing in which it intends (or may intend)
to do so, (E) Parent shall not, within five (5) Business Days of Parent’s receipt of the Notice of Superior Offer, have made an offer that the Company 

  

 45 

 
Board determines in its good faith judgment (after consultation with a financial advisor of national standing) to be at least as favorable to Company’s
shareholders as such Superior Offer (it being agreed that (1) Company and its representatives shall negotiate in good faith with Parent and its representatives for the five (5) Business Day period following Parent’s receipt of the
Notice of Superior Offer regarding any revision to the terms of the transactions contemplated by this Agreement that are proposed by Parent, (2) the Company Board shall convene a meeting to consider any such offer by Parent promptly following
the receipt thereof and (3) the Company Board will not terminate the Agreement pursuant to Section 12.1(g) for five (5) Business Days after receipt by Parent of the Notice of Superior Offer) and (F) the Company Board
concludes in good faith, after consultation with its outside legal counsel, that such Acquisition Proposal continues to represent a Superior Offer. Any material modification to the terms of any such Acquisition Proposal shall trigger a new five
(5) Business Day period for purposes of the immediately preceding sentence. 
 (d) Company promptly (and in any event within 24 hours)
shall advise Parent orally and in writing of (i) the receipt of any Acquisition Proposal and (ii) the material terms of such Acquisition Proposal. Company shall keep Parent reasonably informed on a current basis of the status of, and any
changes to, such Acquisition Proposal and shall promptly provide Parent with copies of any written materials representing such Acquisition Proposal. 
 (e) Nothing contained in this Agreement shall prohibit Company from making any disclosure to the shareholders of Company if the Company Board has concluded in its good faith judgment (after receipt of advice from its
outside legal counsel) that such disclosure is required in order to comply with its fiduciary obligations to Company’s shareholders under applicable Law or to comply with securities laws. The fact that Company makes any such disclosure shall
not in and of itself be deemed to constitute a breach of this Section 7.5. 
 Section 7.6 Further Assurances. Subject to,
and not in limitation of, Section 7.4, each of the Major Shareholders, Company, Merger Sub and Parent shall use its commercially reasonable efforts to (i) take, or cause to be taken, all actions necessary or appropriate to
consummate the transactions contemplated by this Agreement and (ii) cause the fulfillment at the earliest practicable date of all of the conditions to the obligations of the other parties hereto to consummate the transactions contemplated by
this Agreement. 
 Section 7.7 Publicity. Parent and Company shall prepare a press release or public announcement concerning this
Agreement and the transactions contemplated hereby to be issued no later than four (4) Business Days after the execution of this Agreement, and approval of such press release or public announcement will not be unreasonably withheld or delayed
by either Parent or Company. None of Parent, Merger Sub, Major Shareholders or Company shall issue any other press release or public announcement concerning this Agreement or the transactions contemplated hereby without obtaining the prior written
approval of the other party hereto (which approval will not be unreasonably withheld or delayed), unless, in the sole judgment of Parent, disclosure is otherwise required by applicable Law or by the applicable rules of any stock exchange on which
Parent or its Affiliates lists securities. 
  

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 Section 7.8 Cooperation with Financing. 
 (a) Parent and Merger Sub shall use their commercially reasonable efforts to secure financing necessary for the transactions contemplated hereby on terms
reasonably satisfactory to Parent and Merger Sub. 
 (b) In order to assist with securing the debt financing to provide sufficient funds for
Parent to consummate the transactions contemplated by this Agreement, Company shall, and Company shall cause its Subsidiaries to, provide, at Parent’s expense, such assistance and cooperation as Parent and its Affiliates may reasonably request,
including (i) preparing any prospectus, offering memorandum or similar document or marketing material, and, cooperating with initial purchasers or placement agents, (ii) making senior management of Company and its Subsidiaries reasonably
available for customary “roadshow” or syndication, presentations, lender or proposed financing source meetings and rating agencies presentations, (iii) cooperating with prospective lenders, underwriters, placement agents or
initial purchasers and their respective advisors in performing their due diligence, (iv) providing all financial statements and financial and other information that would be required in a registration statement on Form S-1 under the rules and
regulations under the Securities Act in connection with an offering of securities, including three full years of financial statements audited by a “big four” auditing firm, any interim period financial statements that would be
required by the SEC (reviewed in accordance with Statement of Accounting Standards (“SAS”) 100), and any pro forma financial statements that would be required by the SEC in the registration statement on Form S-1, (v) causing
Company’s accountants to provide comfort letters to any underwriters or initial purchasers consistent with SAS 72 (as amended), including standard negative assurance on any interim period of pro forma financial statements, and to undertake such
other procedures with respect to any applicable financial statements as may reasonably be requested by Parent, (vi) entering into customary agreements with lenders, underwriters, initial purchasers and placement agents and their respective
advisors, and (vii) helping procure other definitive financing documents or other reasonably requested certificates or documents, including pledge and security documents, customary certificates (including a certificate of the chief financial
officer of Company with respect to solvency matters), legal opinions and real estate title documentation. 
 Section 7.9 Monthly
Financial Statements. As soon as reasonably practicable, but in no event later than 30 days after the end of each monthly fiscal period during the period from the date hereof to the Closing, Company shall provide Parent with (i) unaudited
monthly financial statements, (ii) operating or management reports (such reports referenced in subsections (i) and (ii) to be in the form prepared by Company in the Ordinary Course of Business) of Company for such preceding month. As
soon as reasonably practicable, but in no event later than 30 days after the end of each monthly fiscal period, during the period from the date hereof to the Closing, Company shall provide Parent with (i) unaudited monthly financial statements
and (ii) operating or management reports (such reports to be in the form prepared by Company and its Subsidiaries in the Ordinary Course of Business) of each of its Subsidiaries for which financial statements are prepared (to the extent the
same are prepared in the Ordinary Course of Business) for such preceding month. Further, as soon as reasonably practicable, but in no event later than 30 days after the end of each monthly fiscal period during the period from the date hereof to the
Closing, Company shall deliver to Parent a certificate executed by Company’s chief financial officer, 

  

 47 

 
setting forth a calculation of each Capital Expenditure for New/Raze & Rebuild Stores, Book Value of Undeveloped Land, and the Debt Payoff Amount,
in each case calculated as of the end of the most recent monthly fiscal period. Such certificate shall be accompanied by such documentation and other evidence reasonably satisfactory to Parent to enable Parent to confirm such calculations.

 Section 7.10 Notification of Certain Matters. Company shall give notice to Parent and Parent shall give notice to Company, as
promptly as reasonably practicable upon becoming aware of (a) any fact, change, condition, circumstance, event, occurrence or non-occurrence that has caused or is reasonably likely to cause any representation or warranty in this Agreement made
by it to be untrue or inaccurate in any material respect at any time after the date hereof and prior to the Closing, (b) any material failure on its part to comply with or satisfy any covenant, condition or agreement to be complied with or
satisfied by it hereunder or (c) the institution of or the threat of institution of any Legal Proceeding against any of the Major Shareholders, Company or any of its Subsidiaries related to this Agreement or the transactions contemplated
hereby; provided that the delivery of any notice pursuant to this Section 7.10 shall not limit or otherwise affect the remedies available hereunder to the party receiving such notice, or the representations or warranties of, or the
conditions to the obligations of, the parties hereto. Parent shall give notice to Company, as promptly as practicable prior to Closing, if Parent obtains actual Knowledge that Company is in material breach of this Agreement. 
 Section 7.11 Notice of Merger and Appraisal Rights. As promptly as practicable following the date of this Agreement, and, in any case, within
ten (10) days after the date upon which the Major Shareholders approve the Merger by written consent, Company shall prepare and deliver to the shareholders of Company a Notice of Merger and Appraisal Rights (the “Shareholder
Notice”), which Shareholder Notice shall comply in all respects with the requirements of the TBCA. All such information contained in the Shareholder Notice shall be accurate and complete as of the date of its delivery to the shareholders of
Company. 
 ARTICLE VIII 
 MUTUAL
CONDITIONS PRECEDENT TO PARTIES’ OBLIGATIONS 
 The respective obligations of each party under this Agreement shall be subject to the
fulfillment at or prior to the Effective Time of the following conditions which may not be waived: 
 Section 8.1 No Injunction.
There shall not be in effect any Order by a Governmental Entity of competent jurisdiction restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated hereby. 
 Section 8.2 HSR. The waiting period under the HSR Act shall have expired or early termination shall have been granted and Parent shall have
obtained or made any other consent, approval, Order or authorization of, or registration, declaration or filing with, any Governmental Entity required to be obtained or made by it in connection with the execution and delivery of this Agreement or
the consummation of the transactions contemplated hereby. 
  

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 ARTICLE IX 
 CONDITIONS PRECEDENT TO PARENT’S AND MERGER SUB’S OBLIGATIONS 
 Notwithstanding the provisions of
Article 2, Parent and Merger Sub shall be obligated to perform the acts contemplated for performance by them under Article 2 only if each of the following conditions is satisfied at or prior to the Closing Date, unless any such
condition is waived in writing by Parent and Merger Sub: 
 Section 9.1 Accuracy of Representations and Warranties by Company. The
representations and warranties of the Major Shareholders qualified as to materiality shall be true and correct, and those not so qualified shall be true and correct in all material respects (other than the representations and warranties contained in
(i) the first sentence of Section 4.1 (Organization), (ii) Section 4.4 (Capitalization) and (iii) Section 4.5 (Subsidiaries, but only insofar as such section relates to direct or indirect ownership of all
interests in the Subsidiaries by Company), which representations and warranties shall be true and correct), in each case, as of the date of this Agreement and as of the Closing as though made at and as of the Closing, except to the extent such
representations and warranties expressly speak only as of an earlier date (in which case such representations and warranties shall be true and correct or true and correct in all material respects, as applicable, on and as of such earlier date).

 Section 9.2 Compliance by Company. The Major Shareholders and Company shall have performed and complied in all material
respects with all obligations and agreements required in this Agreement to be performed or complied with by them or it on or prior to the Closing Date. 
 Section 9.3 No Material Adverse Change. There shall not have been or occurred any event, change, occurrence or circumstance that, individually or in the aggregate with any such events, changes, occurrences
or circumstances, has had or could reasonably be expected to have a Material Adverse Effect since the Balance Sheet Date. 
 Section 9.4
Officers’ Closing Certificate. Parent shall have received a certificate signed by each Major Shareholder and by each of the Chief Executive Officer and Chief Financial Officer of Company, each in form and substance reasonably
satisfactory to Parent, dated the Closing Date, to the effect that each of the conditions specified above in Sections 9.1 through 9.3 have been satisfied in all respects; provided that with respect to Section 9.1,
the Chief Executive Officer and Chief Financial Officer of Company shall only be required to certify as to the representations and warranties contained in Article 4. 
 Section 9.5 Approvals. The applicable waiting period under the HSR Act shall have been terminated or expired, and Company shall have obtained
those consents, waivers and approvals referred to in Sections 3.2(b)(i)-(iv) and 4.3(b)(ii)(A)-(E) hereof in a form reasonably satisfactory to Parent. 
 Section 9.6 Consents. Company shall have obtained those consents listed on Schedule 9.6 in a form reasonably satisfactory to
Parent and copies thereof shall have been delivered to Parent. 
  

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 Section 9.7 Delivery of Articles of Merger. Company shall have duly executed and delivered
the Articles of Merger. 
 Section 9.8 Delivery of Escrow Agreement. The Shareholder Representative, Company and the Escrow Agent
shall have duly executed and delivered the Escrow Agreement and the Escrow Agreement shall be in full force and effect. 
 Section 9.9
Delivery of Cash Exchange Agreement. The Shareholder Representative and the Exchange Agent shall have duly executed and delivered the Cash Exchange Agreement and the Cash Exchange Agreement shall be in full force and effect. 
 Section 9.10 Pay-Off Letters. Company shall have obtained and delivered to Parent the Pay-Off Letters. 
 Section 9.11 Delivery of Secretary’s Certificate. Company shall have delivered (i) a copy of the resolutions adopted by the Board
of Directors and shareholders of Company authorizing the transactions contemplated hereby, (ii) a certificate of the Texas Secretary of State and the Texas Comptroller, dated as of a recent date prior to the Closing, with respect to the legal
existence and good standing of Company under the laws of Texas, (iii) a copy of the articles of incorporation of Company (together with any amendments thereto) and (iv) a copy of the by-laws of Company (together with any amendments
thereto), each of which is certified by the Secretary of Company as true, correct and complete as of the date of resolutions referenced in subsection (i) above and as of the Closing Date, in form and substance reasonably satisfactory to Parent.

 Section 9.12 Financing. Parent shall have received financing necessary for the transactions contemplated hereby, on terms and
conditions satisfactory to Parent in its reasonable discretion. 
 Section 9.13 FIRPTA. Parent shall have received (a) a
certificate from Company complying with Treasury Regulation Section 1.897-2(g)(1)(ii) that states that interests in Company are not “United States real property interests”, and (b) proof reasonably satisfactory to Parent
that Company has provided notice of such certification to the IRS in accordance with the provisions of Treasury Regulations Section 1.897-2(h)(2). 
 ARTICLE X 
 CONDITIONS PRECEDENT TO COMPANY’S OBLIGATIONS 
 Notwithstanding the provisions of Article 2, Company shall be obligated to perform the acts contemplated for performance by it under Article 2 only if
each of the following conditions is satisfied at or prior to the Closing Date, unless any such condition is waived in writing by Company: 
 Section 10.1 Accuracy of Representations and Warranties by Parent and Merger Sub. The representations and warranties of Parent and Merger Sub set forth in this Agreement qualified as to materially shall be true and correct, and
those not so qualified shall be true and 

  

 50 

 
correct in all material respects, in each case, as of the date of this Agreement and as of the Closing as though made at and as of the Closing, except to the
extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties qualified as to materially shall be true and correct, and those not so qualified shall be true and correct in all
material respects, on and as of such earlier date). 
 Section 10.2 Compliance by Parent and Merger Sub. Parent and Merger Sub
each shall have performed and complied in all material respects with all obligations and agreements required by this Agreement to be performed or complied with by it on or prior to the Closing Date. 
 Section 10.3 Officers’ Closing Certificate. Parent shall have executed and delivered to Company at and as of the Closing, a certificate,
duly executed by Parent’s Chief Executive Officer, certifying that the conditions specified in each of Section 10.1 and Section 10.2 have been satisfied. 
 Section 10.4 Approvals. The applicable waiting period under the HSR Act shall have been terminated or expired. 
 Section 10.5 Articles of Merger. Parent and Merger Sub shall have duly executed the Articles of Merger. 
 Section 10.6 Delivery of Escrow Agreement. Parent and the Escrow Agent shall have executed and delivered the Escrow Agreement and the Escrow
Agreement shall be in full force and effect. 
 Section 10.7 Delivery of Cash Exchange Agreement. Parent and the Surviving
Corporation shall have duly executed and delivered the Cash Exchange Agreement and the Cash Exchange Agreement shall be in full force and effect. 
 ARTICLE XI 
 POST-CLOSING COVENANTS OF THE SURVIVING CORPORATION 
 Section 11.1 Severance. 
 (a)
Upon termination of their employment by the Surviving Corporation prior to the first anniversary of the Closing Date, all senior directors and officers and all non-store full time Employees (other than the Major Shareholders) shall be entitled to
the severance payments described below, except in the following circumstances: (i) the Employee was terminated For Cause; (ii) the Employee was offered a comparable position by Parent or the Surviving Corporation at or above his or her
current compensation level and refused such offer; or (iii) the Employee announced his or her retirement prior to Closing or voluntarily retires or otherwise voluntarily terminates his or her employment. 
  

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 (b) Upon termination of their employment by the Surviving Corporation, such Employees of Company will be
entitled to a lump sum severance payment payable within fifteen (15) Business Days following such termination as follows: 
 (i) Each senior director and officer shall receive twelve (12) weeks base compensation as severance pay and an additional one (1) week of base compensation as severance pay for each full year of his or her employment (up to a
maximum of 32 weeks of base compensation). 
 (ii) Each other such Employee shall receive four (4) weeks base
compensation as severance pay plus an additional one (1) week of base compensation as severance pay for each full year of his or her employment (up to a maximum of 24 weeks). 
 (c) Notwithstanding the provisions of clause (ii) of Section 11.1(a), if the applicable employee was offered a comparable position by
Parent or the Surviving Corporation at or above his or her current compensation level and refused such offer but such offer would require geographic relocation, then (i) if such Employee’s base compensation is at an annual rate of $35,000
or less, such Employee shall be entitled to the full amounts provided by Section 11.1(b) and (ii) in cases not covered by clause (i) of this Section 11.1(c), such Employee shall be entitled to 50% of the amount
provided by Section 11.1(b). 
 Section 11.2 Employee Vacation and Benefits following Closing. Each Employee of
Company who continues to be employed by the Surviving Corporation following the Closing shall be credited for every year of service to Company (and therefore will not forfeit his or her tenure) with respect to vacation days and pay scale of the
Surviving Corporation following the Closing. Employees will also receive through March 31, 2008, to the extent commercially reasonable and not inconsistent with applicable law, benefits that are the same as or substantially as favorable as, in
the aggregate, the benefits to which the Company has in effect on the date hereof; provided, under no circumstances will Employees be subjected to period of service waiting periods for eligibility for any employee benefits. Notwithstanding
anything in this Agreement to the contrary, no provision of this Agreement shall be deemed to (i) guarantee employment for any period of time or preclude the ability of the Surviving Corporation to terminate any Employee for any reason or
(ii) require the Surviving Corporation to continue any specific Company Plan. 
 Section 11.3 Directors’ and Officers’
Indemnification and Insurance. 
 (a) Without limiting any additional rights that any Employee, officer or director may have under any
Company Plan or under Company’s articles of incorporation or by-laws, after the Effective Time, Surviving Corporation shall indemnify and hold harmless each present (as of the Effective Time) and former officer or director of Company and each
of its Subsidiaries (the “Indemnified Directors and Officers”), against all claims, losses, liabilities, damages, judgments, inquiries, fines and any reasonable fees, costs and expenses, including attorneys’ fees and
disbursements incurred in connection with any claim, action, suit proceeding or investigation, whether civil, criminal, administrative or investigative, arising out of actions taken by them in their capacity as officers or directors at or prior to
the Effective Time (including this Agreement and the transactions and actions contemplated hereby), or taken by them at the request of 

  

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Company or any of its Subsidiaries, whether asserted or claimed prior to, at or after the Effective Time, to the fullest extent permitted under applicable
Law for a period of six (6) years from the Effective Time; provided that, in no event will any claim that a Parent Indemnified Party has under Section 12.3 hereof be considered a matter for which the Surviving Corporation will have
any such indemnification obligation. Each Indemnified Director and Officer will be entitled to advancement of expenses incurred in the defense of any claim, action, suit, proceeding or investigation from the Surviving Corporation within ten
(10) Business Days or receipt by the Surviving Corporation from the Indemnified Director or Officer of a request therefor. The Surviving Corporation shall not settle, compromise or consent to the entry of judgment in any proceeding or
threatened action, suit, proceeding, investigation or claim in which indemnification could be sought by such Indemnified Director or Officer hereunder, unless such settlement, compromise or consent includes an unconditional release of such
Indemnified Director and Officer from all liability arising out of such action, suit, proceeding, investigation or claim or such Indemnified Director or Officer otherwise consents. 
 (b) The articles of incorporation and by-laws of the Surviving Corporation shall continue to contain provisions no less favorable with respect to
indemnification, advancement of expenses and exculpation of former or present directors and officers than are presently set forth in Company’s articles of incorporation and by-laws, which provisions shall not be amended, repealed or otherwise
modified for a period of six (6) years from the Effective Time in any manner that would adversely affect the rights thereunder of any such individuals. 
 (c) For six (6) years after the Effective Time, Surviving Corporation shall, at its sole expense, either (a) cause to be maintained directors’ and officers’ liability insurance (“D&O
Insurance”) in respect of acts or omissions occurring prior to the Effective Time covering each individual who at the date of this Agreement was an Indemnified Director or Officer covered as of the date hereof or hereafter by Company’s
D&O Insurance on terms with respect to coverage and amounts no less favorable than those of such policy in effect on the date hereof or (b) have the right to cause coverage to be extended under Company’s D&O Insurance by obtaining
a six (6) year “tail” policy on terms and conditions no less advantageous than Company’s existing D&O Insurance, and such “tail” policy shall satisfy the provisions of this Section 11.3(c).

 (d) In the event the Surviving Corporation or any of its successors or assigns (i) consolidates with or merges into any other Person
and shall not be the continuing or surviving corporation or entity of such consolidation or merger or (ii) transfers all or substantially all of its properties and assets to any Person, then, in each such case, proper provisions shall be made
so that the successors and assigns of the Surviving Corporation, or at Parent’s option, Parent, shall assume the obligations set forth in this Section 11.3. 
 (e) This Section 11.3 shall survive the consummation of the merger contemplated hereby, is intended to benefit each of the Indemnified
Directors and Officers, shall be binding on all successors and assigns of the Surviving Corporation and Parent, shall be enforceable by each Indemnified Director and Officer and his or her heirs and representatives, and may not be amended, altered
or repealed with respect to any Indemnified Director or Officer after the Effective Time without the prior written consent of such Indemnified Director or Officer 

  

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(provided that any amendment, alteration or repeal prior to the Effective Time shall be governed by Section 13.3). 
 Section 11.4 Preservation of Records. Subject to any retention requirements relating to the preservation of Tax records, the Major
Shareholders and Parent agree that each of them shall (and shall cause Company and its Subsidiaries to) preserve and keep the records held by each of them relating to the respective businesses of Company and its Subsidiaries for a period of seven
years from the Closing Date and shall make such records and personnel available to the other party as may be reasonably required by such party in connection with, among other things, any insurance claims by, legal proceedings against or governmental
investigations of the Major Shareholders, Company, its Subsidiaries or Parent or any of their Affiliates or in order to enable the Major Shareholders to comply with their respective obligations under this Agreement and each other agreement, document
or instrument contemplated hereby or thereby. In the event the Major Shareholders or Parent wish to destroy (or permit to be destroyed) such records after that time, such party shall first give 90 days prior written notice to the other party (to the
Shareholder Representative on behalf of the Major Shareholders) and such other party shall have the right at its option and expense, upon prior written notice given to such party within that 90 day period, to take possession of the records within
180 days after the date of such notice. 
 Section 11.5 Use of Name. The Major Shareholders hereby agree that upon the Closing,
the Major Shareholders shall not have the right to the use of the name “Town and Country”, “Town and Country Food Stores”, “TCFS” or similar names and any service marks, trademarks, trade names,
d/b/a names, fictitious names, identifying symbols, logos, emblems, signs or insignia related thereto or containing or comprising the foregoing, or otherwise used in the business of Company and its Subsidiaries, including any name or mark
confusingly similar thereto and the trademarks and service marks listed on Schedule 4.13(b) (collectively, the “Company Marks”). The Major Shareholders shall not, and shall not permit their respective Affiliates to, use such
name or any variation or simulation thereof or any of Company Marks. 
 ARTICLE XII 
 CLAIMS AGAINST INDEMNIFICATION ESCROW FUND 
 Section 12.1 Applicability.
The provisions of this Article 12 shall apply and become effective only if the Merger is consummated. 
 Section 12.2 Survival
of Representations and Warranties. The representations and warranties of the parties contained in this Agreement, any certificate delivered pursuant hereto or any Major Shareholder Document, Company Document or Merger Sub Document shall survive
the Closing through and including (x) as to indemnification claims that do not involve any Third Party Claim, fifteen months after the Closing Date and (y) as to indemnification claims that involve any Third Party Claim, two years after
the Closing Date; provided, however, that the representations and warranties (a) of the Major Shareholders and, as applicable, Company set forth in Sections 3.1 (Execution and Delivery of Agreement and Major Shareholder
Documents), 3.3 (Ownership), 4.2 (Authorization ), 4.4 (Capitalization), and 4.5 (Subsidiaries, but only insofar as such section relates to direct or indirect ownership of all interests in the Subsidiaries by Company),
shall survive the Closing indefinitely and (b) of Parent and Merger Sub set forth 

  

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in Sections 5.1 (Organization and Good Standing) and 5.2 (Authorization of Agreement) shall survive the Closing indefinitely (in each case, the
“Survival Period”); provided, however, that any obligations under Section 12.3 shall not terminate with respect to any Losses as to which the Person to be indemnified shall have given notice (stating in
reasonable detail the basis of the claim for indemnification) to the indemnifying party in accordance with Section 12.4 before the termination of the applicable Survival Period. 
 Section 12.3 Indemnification. 
 (a) Subject to Sections 12.2, 12.5 and 12.6 hereof, the Major Shareholders hereby agree, jointly and severally (except that with respect to Sections 12.3(a)(i) and (ii), each Major Shareholder agrees
severally, but not jointly, and with respect only to representations, warranties and covenants of such Major Shareholder), to indemnify and hold Parent, Company, and their respective directors, officers, employees, Affiliates, shareholders, agents,
attorneys, representatives, successors and assigns (collectively, the “Parent Indemnified Parties”) harmless from and against, and pay to the applicable Parent Indemnified Parties the amount of, any and all losses (including any
losses in value), Liabilities, claims, obligations, deficiencies, demands, judgments, damages (including incidental and consequential damages), interest, fines, penalties, claims, suits, actions, causes of action, assessments, awards, costs and
expenses (including reasonable costs of investigation and defense and attorneys’ and other professionals’ fees) whether or not involving a Third Party Claim (individually, a “Loss” and, collectively,
“Losses”): 
 (i) based upon, attributable to or resulting from the failure of any of the representations or
warranties made by such Major Shareholder in Article 3 of this Agreement or in any Major Shareholder Document to be true and correct in all respects at and as of the date hereof or (unless such representation or warranty expressly speaks only
as of an earlier date) at and as of the Closing Date; 
 (ii) based upon, attributable to or resulting from the breach of any
covenant or other agreement on the part of such Major Shareholder under this Agreement or any Major Shareholder Document; 
 (iii) based upon, attributable to or resulting from the failure of any of the representations or warranties in Article 4 of this Agreement or in any Company Document to be true and correct in all respects at and as of the date hereof
or (unless such representations or warranty expressly speaks only as of an earlier date) at and as of the Closing Date; 
 (iv) based upon, attributable to or resulting from the breach of any covenant or other agreement at or prior to the Closing on the part of Company under this Agreement or any Company Document; 
 (v) based upon, attributable to or resulting from (A) any Taxes imposed on Company and its Subsidiaries (or any predecessor thereof)
(I) for any taxable period ending on or before June 2, 2007, and (II) for the portion of any Straddle Period ending at the close of business on June 2, 2007 (determined as provided in Section 12.7(b)), and 

  

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(B) without duplication, any Taxes described in clause (A) that were paid between June 2, 2007 and the Closing, but, in each case, except to the
extent such Taxes reduced the Closing Purchase Price pursuant to Section 2.3(a)(vii); 
 (vi) representing any
Company Transaction Expenses, or any fees or other payments required for the release (and recording thereof) of any security interest securing the Debt Payoff Amount, that were not taken into account in determining the Closing Purchase Price; or

 (vii) representing the amount of deductible or self-insured retention paid or incurred by Parent or Company or any
Subsidiary of Company after Closing in connection with any other Loss arising as a result of the operation of the business of the Company and its Subsidiaries prior to Closing. 
 (viii) in respect of any Loss arising under Texas Property Tax Code Section 22.28 from the operation of the business of Company and
its Subsidiaries prior to the Closing. 
 (b) Subject to Sections 12.2 and 12.5, Parent hereby agrees to indemnify and hold the
Major Shareholders and their respective Affiliates, shareholders, agents, attorneys, representatives, successors and permitted assigns (collectively, the “Major Shareholder Indemnified Parties”) harmless from and against, and pay to
the applicable Major Shareholder Indemnified Parties the amount of any and all Losses: 
 (i) based upon, attributable to or
resulting from the failure of any of the representations or warranties made by Parent in this Agreement or in any Merger Sub Document to be true and correct in all respects at the date hereof and as of the Closing Date; or 
 (ii) based upon, attributable to or resulting from the breach of any covenant or other agreement on the part of Parent under this
Agreement or any Merger Sub Document. 
 (c) The right to indemnification or any other remedy based on representations, warranties, covenants
and agreements in this Agreement, or any Major Shareholder Document, Company Document or Merger Sub Document shall not be affected by any investigation conducted at any time, or any Knowledge acquired (or capable of being acquired) at any time,
whether before or after the execution and delivery of this Agreement or the Closing Date, with respect to the accuracy or inaccuracy of, or compliance with, any such representation, warranty, covenant or agreement. The waiver of any condition based
on the accuracy of any such representation or warranty, or on the performance of or compliance with any such covenant or agreements, will not affect the right to indemnification or any other remedy based on such representations, warranties,
covenants and agreements. 
 (d) Notwithstanding the foregoing provisions of this Section 12.3, to the extent an indemnified
party receives any insurance proceeds or similar reimbursements and such indemnified party has received an indemnification payment in respect of the matter for which 

  

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such insurance proceeds or similar reimbursements, such indemnified party will promptly reimburse the indemnifying party therefor, to the extent any such
insurance proceeds or similar reimbursements reduced the relevant indemnifiable Loss of such indemnified party for which such indemnified party already received an indemnification payment; provided, however, that in the case of any such insurance
proceeds or similar reimbursements received by a Parent Indemnified Party, such Parent Indemnified Party will effect any such reimbursement payment by paying the applicable amount (i) to the Escrow Agent if any Escrow Funds then remain in
escrow (and such amount shall be added to the Escrow Funds), or (ii) otherwise to the Shareholder Representative, in which case such amounts shall be treated for all purposes of this Agreement as amounts of Escrow Funds released to the
Shareholder Representative for the benefit of the Company Shareholders in accordance with Section 2.5(e) hereof. 
 Section 12.4 Indemnification Procedures. Except for claims or Legal Proceedings relating to Taxes (which shall be governed by Section 12.7): 
 (a) A claim for indemnification for any matter not involving a Third Party Claim may be asserted by notice given as promptly as reasonably practicable;
provided, however, that failure to give reasonably prompt notice shall not preclude the indemnified party from any indemnification which it may claim in accordance with this Article 12, except to the extent the indemnifying
party can demonstrate material prejudice as a result of such delay. 
 (b) In the event that any Legal Proceedings shall be instituted or
that any claim or demand shall be asserted by any third party in respect of which indemnification may be sought under Section 12.3 hereof (a “Third Party Claim”), the indemnified party shall promptly cause written notice
of the assertion of any Third Party Claim of which it has knowledge which is covered by this indemnity to be forwarded to the indemnifying party as promptly as reasonably practicable. The failure of the indemnified party to give reasonably prompt
notice of any Third Party Claim shall not preclude the indemnified party from any indemnification which it may claim in accordance with this Article 12, except to the extent that the indemnifying party can demonstrate material prejudice as a
result of such delay. Subject to the provisions of this Section 12.4, the indemnifying party shall have the right, at its sole expense, to be represented by counsel of its choice, which must be reasonably satisfactory to the indemnified
party, and to defend against, negotiate, settle or otherwise deal with any Third Party Claim which relates to any Losses indemnified against hereunder; provided that the indemnifying party shall have acknowledged in writing to the indemnified
party its unqualified obligation to indemnify the indemnified party as provided hereunder. If the indemnifying party elects to defend against, negotiate, settle or otherwise deal with any Third Party Claim which relates to any Losses indemnified by
it hereunder, it shall within five days of the indemnified party’s written notice of the assertion of such Third Party Claim (or sooner, if the nature of the Third Party Claim so requires) notify the indemnified party of its intent to do so;
provided, that the indemnifying party must conduct the defense of the Third Party Claim actively and diligently thereafter in order to preserve its rights in this regard. If the indemnifying party elects not to defend against, negotiate,
settle or otherwise deal with any Third Party Claim which relates to any Losses indemnified against hereunder, fails to notify the indemnified party of its election as herein provided or contests its obligation to indemnify the indemnified party for
such Losses under this Agreement, the indemnified party may defend against, negotiate, settle or otherwise deal with 

  

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such Third Party Claim. If the indemnified party defends any Third Party Claim, then the indemnifying party shall reimburse the indemnified party for the
reasonable expenses of defending such Third Party Claim upon submission of periodic bills. If the indemnifying party shall assume the defense of any Third Party Claim, the indemnified party may participate, at his or its own expense, in the defense
of such Third Party Claim; provided, however, that such indemnified party shall be entitled to participate in any such defense with separate counsel at the expense of the indemnifying party if (i) so requested by the indemnifying
party to participate or (ii) in the reasonable opinion of counsel to the indemnified party, a conflict or potential conflict exists between the indemnified party and the indemnifying party that would make such separate representation advisable;
and provided, further, that the indemnifying party shall not be required to pay for more than one such counsel for all indemnified parties in connection with any Third Party Claim. The parties hereto agree to provide reasonable access
to the other to such documents and information as may be reasonably requested in connection with the defense, negotiation or settlement of any such Third Party Claim. Notwithstanding anything in this Section 12.4 to the contrary, neither
the indemnifying party nor the indemnified party shall, without the written consent of the other party, settle or compromise any Third Party Claim or permit a default or consent to entry of any judgment unless the claimant or claimants and such
party provide to such other party an unqualified release from all liability in respect of the Third Party Claim. If the indemnifying party makes any payment on any Third Party Claim, the indemnifying party shall be subrogated, to the extent of such
payment, to all rights and remedies of the indemnified party to any insurance benefits or other claims of the indemnified party with respect to such Third Party Claim. 
 (c) After any final decision, judgment or award shall have been rendered by a Governmental Entity of competent jurisdiction and the expiration of the time in which to appeal therefrom, or a settlement shall have been
consummated, or the indemnified party and the indemnifying party shall have arrived at a mutually binding agreement, in each case with respect to an Third Party Claim hereunder, the indemnified party shall forward to the indemnifying party notice of
any sums due and owing by the indemnifying party pursuant to this Agreement with respect to such matter and the indemnifying party shall pay all of such remaining sums so due and owing to the indemnified party in accordance with this
Section 12.4 and Section 12.6. 
 Section 12.5 Limitations on Indemnification for Certain Losses.

 (a) The Major Shareholders shall not have any liability under Section 12.3(a)(i), Section 12.3(a)(iii) or
Section 12.3(a)(vii) hereof with respect to the aggregate amount of Losses incurred by the Parent Indemnified Parties (i) for any individual item, or group of items arising out of the same event or related events, where the Loss
relating thereto is less than $25,000 (the “Sub-Basket”) and (ii) in respect of each individual item, or group of items arising out of the same event or related events, where the Loss relating thereto is equal to or greater
than the Sub-Basket, unless the aggregate amount of all Losses otherwise indemnifiable under Section 12.3(a)(i), Section 12.3(a)(iii) or Section 12.3(a)(vii) but for this clause (ii) exceeds $1,000,000 (the
“Basket”) and then only to the extent of such excess; provided that the Basket and Sub-Basket limitation shall not apply to Losses related to the failure to be true and correct of any of the representations and warranties set
forth in Sections 3.1 (Authorization), 3.3 (Ownership), 3.5 (Financial Advisors), 4.1 (Organization), 4.2 (Authorization), 4.4 (Capitalization), 4.5  

  

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(Subsidiaries, but only insofar as such section relates to direct or indirect ownership of all interests in the Subsidiaries by Company), 4.10
(Taxes), 4.23 (Issuances and Repurchases of Securities), and 4.25 (Financial Advisors) hereof. 
 (b) For purposes of
determining the failure of any representations or warranties to be true and correct, the breach of any covenants and agreements, and calculating Losses hereunder, any materiality or Material Adverse Effect qualifications in the representations or
warranties shall be disregarded. 
 (c) The Major Shareholders shall have no right of contribution or other recourse against Company or its
Subsidiaries or their respective directors, officers, employees, Affiliates, agents, attorneys, representatives, assigns or successors for any Third Party Claims asserted by Parent Indemnified Parties, it being acknowledged and agreed that the
covenants and agreements of Company are solely for the benefit of the Parent Indemnified Parties. 
 (d) For any indemnity under
Section 12.3(a) involving a Remedial Action at a currently owned property, the indemnity shall be limited to those amounts reasonably necessary to achieve the least stringent regulatory standard acceptable to the relevant Governmental
Authority under Environmental Law for a property used for commercial/industrial purposes with restrictions prohibiting the use of groundwater, but not requiring any type of engineering controls or affirmative obligations on the part of the property
owner to maintain closure or NFA. 
 (e) Losses payable by an indemnifying party under this Article 12, (i) except with regard to
Losses arising in connection with Third Party Claims, shall not include punitive damages, consequential damages, damages related to mental or emotional distress, exemplary damages, and special damages or other indirect or incidental damages (other
than lost profits or diminution in value) and (ii) consisting of expenses of legal counsel, experts, engineers and consultants, shall include (A) the actual amount of such expenses incurred by third parties as sought by a Third Party Claim
and (B) only the amount of such other reasonable expenses incurred by the indemnified party. 
 Section 12.6 Indemnity Escrow;
Exclusivity of Escrow. Any payment the Major Shareholders are obligated to make to any Parent Indemnified Parties pursuant to this Article 12 shall be paid by release of funds to the Parent Indemnified Parties from the Escrow Funds by the
Escrow Agent. Except as provided in the immediately following sentence, the right of the Parent Indemnified Parties to indemnification under this Article 12 shall be limited to the Escrow Funds and no Major Shareholder shall have any personal
liability for indemnification under this Article 12. The limitation in the immediately preceding sentence shall not apply in connection with any Losses related to (i) the failure to be true and correct of any of the representations
in Sections 3.3 (Ownership), 4.4 (Capitalization), or 4.5 (Subsidiaries, but only insofar as such section relates to direct or indirect ownership of all interests in the Subsidiaries by Company), or (ii) fraud or any
intentional misrepresentation. 
  

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 Section 12.7 Tax Matters. 
 (a) Filing of Tax Returns; Payment of Taxes. 
 (i) Company shall (and shall cause its Subsidiaries to) timely file all Tax Returns required to be filed by it on or prior to the Closing Date and shall pay or cause to be paid all Taxes shown due thereon. All such
Tax Returns shall be prepared in a manner consistent with prior practice. Company shall provide Parent with copies of such completed Tax Returns at least twenty days prior to the due date for filing thereof, along with supporting workpapers, for
Parent’s review and approval (not to be unreasonably withheld or delayed). If Parent does not deliver notice to Company of a disagreement regarding a Tax Return within ten (10) days of Parent’s receipt thereof, Parent shall be treated
as having conclusively approved such return. Company and Parent shall attempt in good faith to resolve any disagreements regarding such Tax Returns prior to the due date for filing. In the event that Company and Parent are unable to resolve any
dispute with respect to such Tax Return at least ten days prior to the due date for filing, such dispute shall be resolved pursuant to Section 12.7(d), which resolution shall be binding on the parties. 
 (ii) Following the Closing, Parent shall cause to be timely filed all Tax Returns for taxable period beginning on or before the Closing
Date required to be filed by Company and its Subsidiaries after the Closing Date and, subject to the right to payment from the Escrow Funds under Section 12.7(a)(iii), pay or cause to be paid all Taxes shown due thereon. Parent shall
provide Shareholder Representative with copies of such completed Tax Returns at least twenty days prior to the due date for filing thereof, along with supporting workpapers, for Shareholder Representative’s review and approval (not to be
unreasonably withheld or delayed). If Shareholder Representative does not deliver notice to Parent of a disagreement regarding a Tax Return within ten (10) days of Shareholder Representative’s receipt thereof, Shareholder Representative
shall be treated as having conclusively approved such return. Shareholder Representative and Parent shall attempt in good faith to resolve any disagreements regarding such Tax Returns prior to the due date for filing. In the event that Shareholder
Representative and Parent are unable to resolve any dispute with respect to such Tax Return at least ten days prior to the due date for filing, such dispute shall be resolved pursuant to Section 12.7(d), which resolution shall be binding
on the parties. 
 (iii) Not later than ten days prior to the due date for the payment of Taxes on any Tax Returns which
Parent has the responsibility to cause to be filed pursuant to Section 12.7(a)(ii), the Escrow Agent shall pay to Parent the amount of Taxes, as reasonably determined by Parent, owed by the Major Shareholders pursuant to the provisions
of Section 12.3(a)(v). No payment pursuant to this Section 12.7(a)(iii) shall excuse the Major Shareholders from their indemnification obligations pursuant to Section 12.3(a)(v) if the amount of Taxes as
ultimately determined (on audit or otherwise) for the periods covered by such Tax Returns exceeds the amount of the payment under this Section 12.7(a)(iii). 
  

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 (b) Straddle Period Tax Allocation. In any case in which a Tax is assessed with respect to a
taxable period which includes June 2, 2007 (but does not begin or end on that day) (a “Straddle Period”), the Taxes, if any, attributable to a Straddle Period shall be allocated (i) to the period up to and including the
close of business on June 2, 2007, on the one hand, and (ii) to the period subsequent to June 2, 2007, on the other hand, by means of a closing of the books and records of Company and the Subsidiaries as of the close of June 2,
2007, provided that exemptions, allowances or deductions that are calculated on an annual basis (including, but not limited to, depreciation and amortization deductions) and Taxes that are assessed on a periodic basis (such as real and personal
property Taxes) shall be allocated between the period ending on June 2, 2007 and the period after June 2, 2007 in proportion to the number of days in each such period. 
 (c) Tax Audits. 
 (i)
If notice of any Legal Proceeding with respect to Taxes of Company or any of its Subsidiaries (a “Tax Claim”) shall be received by either party for which the other party may reasonably be expected to be liable pursuant to
Section 12.3, the notified party shall notify such other party in writing of such Tax Claim; provided, however, that the failure of the indemnified party to give reasonably prompt notice as provided herein shall not release, waive or
otherwise affect the indemnifying party’s obligations with respect thereto except to the extent that the indemnifying party can demonstrate material prejudice as a result of such failure. 
 (ii) Company shall have the right, at the expense of the Major Shareholders to the extent such Tax Claim is subject to indemnification by
the Major Shareholders pursuant to Section 12.3(a)(v) hereof, to represent the interests of Company and the Subsidiaries in any Tax Claim; provided, that, with respect to a Tax Claim relating exclusively to taxable periods (or portions
thereof) ending on or before June 2, 2007, (i) Company shall keep Shareholder Representative reasonably informed regarding the progress of such Tax Claim, (ii) Company shall promptly provide Shareholder Representative with copies of
any correspondence received from of sent to any Taxing Authority in connection with such Tax Claim, and (iii) Company shall not settle such claim without the consent of Shareholder Representative, which consent shall not be unreasonably
withheld. 
 (d) Disputes. Any dispute as to any Tax matter covered hereby shall be resolved by an independent accounting firm
mutually acceptable to the Shareholder Representative and Parent. The fees and expenses of such accounting firm shall be borne equally by the Major Shareholders, on the one hand, and Parent on the other. If any dispute with respect to a Tax Return
is not resolved prior to the due date of such Tax Return, such Tax Return shall be filed in the manner which the party responsible for preparing such Tax Return deems correct without prejudice to the respective rights and obligations of the parties
hereto. 
 Section 12.8 Tax Treatment of Indemnity Payments. The Major Shareholders and Parent agree to treat any indemnity
payment made pursuant to this Article 12 as an adjustment to the purchase price for all income Tax purposes. 
  

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 Section 12.9 Exclusive Remedy. From and after the Closing, the sole and exclusive remedy for
any breach or failure to be true and correct of any representation or warranty in this Agreement or any failure to perform any covenant in this Agreement prior to the Closing (other than, in any such case, due to fraud or intentional
misrepresentation) shall be indemnification in accordance with this Article 12. Further, after Closing, Parent Indemnified Parties do hereby release each Major Shareholder from any and all Environmental Costs and Liabilities and any other
claims, demands, and causes of action under any Law, including Environmental Law, relating to any environmental, health or safety matter or the Release or threatened Release of any Hazardous Materials, except to the extent Parent Indemnified Parties
are entitled to an indemnity under this Article 12 and such indemnity shall be Parent Indemnified Parties’ sole and exclusive remedy for such matters. 
 ARTICLE XIII 
 TERMINATION; LIABILITIES CONSEQUENT THEREON 
 Section 13.1 Termination. This Agreement may be terminated prior to the Closing as follows: At the election of the Shareholder Representative
or Parent on or after December 21, 2007 (such date, as it may be extended under this Section 13.1(a), the “Termination Date”), if the Closing shall not have occurred by the close of business on such date; provided,
that either Parent or the Shareholder Representative shall have the option to extend, from time to time, the Termination Date for additional periods of time not to exceed 60 days in the aggregate if all other conditions to the Closing are satisfied
or capable of then being satisfied and the sole reason that the Closing has not been consummated due to the failure to obtain the necessary consents and approvals under applicable Laws or an Order of a Governmental Entity of competent jurisdiction;
provided, further, that Parent may elect to extend the Termination Date to no later than February 1, 2008); 
 (a) by
mutual written consent of the Shareholder Representative and Parent; 
 (b) by written notice from Parent to the Shareholder Representative
if there has been an event, change, occurrence or circumstance, individually or in the aggregate with any such events, changes, occurrences or circumstances that has had or could reasonably be expected to have a Material Adverse Effect; 

(c) by the Shareholder Representative or Parent if there shall be in effect a final nonappealable Order of a Governmental Entity of competent
jurisdiction restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated hereby; 
 (d) by Parent if
any Major Shareholder or Company shall have materially breached or failed to perform any of its covenants or agreements set forth in this Agreement, or if any representation or warranty of any Major Shareholder or Company shall have become
materially untrue, in either case such that the conditions set forth in Sections 9.1 or 9.2 would not be satisfied and such breach is incapable of being cured or, if capable of being cured, shall not have been cured within thirty
(30) days following receipt by the Shareholder Representative of notice of such breach from Parent; or 
  

 62 

 (e) by the Shareholder Representative if Parent shall have materially breached or failed to perform any
of its covenants or agreements set forth in this Agreement, or if any representation or warranty of Parent shall have become materially untrue, in either case such that the conditions set forth in Sections 10.1 or 10.2 would not be
satisfied and such breach is incapable of being cured or, if capable of being cured, shall not have been cured within thirty (30) days following receipt by Parent of notice of such breach from the Shareholder Representative. 
 (f) By Company, at any time prior to the expiration of thirty-five (35) days from the date of this Agreement in accordance with
Section 7.5(c); provided, that, in order for the termination of this Agreement pursuant to this paragraph (g) to be deemed effective, the Company shall have complied with Section 7.5(c) and with applicable requirements,
including the payment of the Company Termination Fee pursuant to Section 13.3. 
 Section 13.2 Procedure Upon
Termination. In the event of termination and abandonment by Parent or the Shareholder Representative, or both, pursuant to Section 13.1, written notice thereof shall forthwith be given to the other party or parties, and this
Agreement shall terminate, and the Merger hereunder shall be abandoned, without further action by Parent, Company or the Major Shareholders. 
 Section 13.3 Effect of Termination. In the event that this Agreement is validly terminated as provided herein, then each of the parties shall be relieved of their duties and obligations arising under this Agreement after the
date of such termination and such termination shall be without liability to Parent, any Major Shareholder or Company; provided, however, (a) if this Agreement is terminated by the Shareholder Representative or Parent pursuant to
Section 13.1(a) in a case where all conditions to the obligations of the parties to effect the Closing other than the condition set forth in Section 9.15 (Financing) were satisfied (or, in the case of such other conditions
that by their terms could not be satisfied until the Closing, such conditions were capable of being so satisfied), then Parent shall pay to Company within three Business Days of the termination an amount equal to $500,000 plus the amount of all
reasonable out-of-pocket fees and expenses incurred by Company in connection with the transactions contemplated by this Agreement (the “Parent Termination Fee”), (b) if this Agreement is terminated by the Shareholder
Representative pursuant to Section 13.1(f), Parent shall pay the Parent Termination Fee to Company within three Business Days of the termination, (c) if this Agreement is terminated by Company pursuant to
Section 13.1(g), then Company shall pay to Parent within three Business Days of such termination an amount equal to the Company Termination Fee, (d) the obligations of the parties set forth in this Article 13 and
Section 7.7 hereof shall survive any such termination and shall be enforceable hereunder, and (e) subject to the final sentence of this Section 13.3, nothing in this Section 13.3 shall relieve Parent, any
Major Shareholder or Company of any liability for a breach of this Agreement prior to the termination. The parties agree that the Parent Termination Fee is a reasonable estimate of Company’s damages, shall be considered liquidated damages (not
a penalty) and represents the maximum liability of Parent and Merger Sub in the case of termination of this Agreement. 
  

 63 

 ARTICLE XIV 
 MISCELLANEOUS PROVISIONS 
 Section 14.1 Expenses. Except as otherwise provided in this
Agreement, the Major Shareholders and Company, on the one hand, and Merger Sub and Parent, on the other hand, shall each bear their own expenses incurred in connection with the negotiation and execution of this Agreement and each other agreement,
document and instrument contemplated by this Agreement and the consummation of the transactions contemplated hereby and thereby, it being understood that in no event shall Company bear any of such costs and expenses. Notwithstanding the foregoing,
each of Company, on the one hand, and Parent, on the other hand, shall each be responsible for half of all filing fees lawfully payable to or at the request of any Governmental Entity in connection with this Agreement, the Major Shareholder
Documents, the Merger Sub Documents and the consummation of the transactions contemplated hereby and thereby, including any filing under the HSR Act. 
 Section 14.2 Specific Performance. Each of Parent, Merger Sub, Company and the Major Shareholders acknowledges and agrees that (i) a breach of this Agreement by Company and the Major Shareholders
would cause irreparable damage to Parent and that Parent will not have an adequate remedy at law and (ii) a breach of this Agreement by Parent or Merger Sub would cause irreparable damage to Company and the Major Shareholders will not have an
adequate remedy at law. Therefore, the obligations of Parent, Merger Sub, Company and the Major Shareholders under this Agreement, including the obligation of Company to Merge with Merger Sub, shall be enforceable by a decree of specific performance
issued by any court of competent jurisdiction, and appropriate injunctive relief may be applied for and granted in connection therewith. Such remedies shall, however, be cumulative and not exclusive and shall be in addition to any other remedies
which any party may have under this Agreement or otherwise. 
 Section 14.3 Entire Agreement; Waivers; Amendments. This Agreement
(including the schedules and exhibits hereto), the Major Shareholder Documents and the Merger Sub Documents represent the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and can be amended,
supplemented or changed, and any provision hereof can be waived, only by written instrument making specific reference to this Agreement signed by the party against whom enforcement of any such amendment, supplement, modification or waiver is sought.
No action taken pursuant to this Agreement, including any investigation by or on behalf of any party, shall be deemed to constitute a waiver by the party taking such action of compliance with any representation, warranty, covenant or agreement
contained herein. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the
part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such party preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. All remedies hereunder are cumulative and are not exclusive of any other remedies provided by law. 
  

 64 

 Section 14.4 Notices. All notices and other communications under this Agreement shall be in
writing and shall be deemed given (i) when delivered personally by hand (with written confirmation of receipt), (ii) when sent by facsimile (with written confirmation of transmission) or (iii) one Business Day following the day sent
by overnight courier (with written confirmation of receipt), in each case at the following addresses and facsimile numbers (or to such other address or facsimile number as a party may have specified by notice given to the other party pursuant to
this provision): 
 If to any Major Shareholder or, prior to Closing, Company, to: 
 David Lloyd Norris 
 5005 Saddle Ridge Trail

 San Angelo, TX 76904 
 With a
copy to: 
 Haynes and Boone, LLP 
 901 Main Street, Suite 3100 
 Dallas, TX 75202 
 Attention: Greg R. Samuel 
 If to Parent, Merger Sub or after the Closing, to the Surviving Company, to:

 Susser Holdings Corporation 
 4433 Baldwin Blvd. 
 Corpus Christi, TX 78408 
 Attention: E. V. Bonner, Jr. 
 With a copy to: 
 Weil, Gotshal & Manges LLP 
 100
Crescent Court, Suite 1300 
 Dallas, Texas 75201-6950 
 Attention: R. Jay Tabor 
 Facsimile: 214-746-7777 
 Section 14.5 Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns. Nothing in this Agreement shall create or be deemed to create any third party beneficiary rights in any person or entity not a party to this Agreement except as provided below. No assignment of this Agreement or of
any rights or obligations hereunder may be made by either the Major Shareholders or Parent (by operation of law or otherwise) without the prior written consent of the other parties hereto and any attempted assignment without the required consents
shall be void; provided, however, that Parent or Merger Sub may assign this Agreement and any or all rights or obligations hereunder to any Affiliate of Parent or Merger Sub, any Person from which it has borrowed money or any Person to
which Parent or any of its Affiliates proposes to sell all or 

  

 65 

 
substantially all of the assets relating to the business. Upon any such permitted assignment, the references in this Agreement to Parent shall also apply to
any such assignee unless the context otherwise requires. 
 Section 14.6 Severability. If any term or other provision of this
Agreement is invalid, illegal, or incapable of being enforced by any law or public policy, all other terms or provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent
possible. 
 Section 14.7 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the
State of Texas applicable to contracts made and performed in such state. 
 Section 14.8 Jurisdiction and Venue. 
 (a) The parties hereto hereby irrevocably submit to the non-exclusive jurisdiction of any federal or state court located within the State of Texas over
any dispute arising out of or relating to this Agreement or any of the transactions contemplated hereby and each party hereby irrevocably agrees that all claims in respect of such dispute or any suit, action proceeding related thereto may be heard
and determined in such courts. The parties hereby irrevocably waive, to the fullest extent permitted by applicable law, any objection which they may now or hereafter have to the laying of venue of any such dispute brought in such court or any
defense of inconvenient forum for the maintenance of such dispute. Each of the parties hereto agrees that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

 (b) Each of the parties hereto hereby consents to process being served by any party to this Agreement in any suit, action or proceeding by
delivery of a copy thereof in accordance with the provisions of Section 14.4. 
 (c) THE PARTIES TO THIS AGREEMENT EACH HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION (i) ARISING UNDER THIS AGREEMENT OR (ii) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
PARTIES HERETO IN RESPECT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY, OR OTHERWISE. THE PARTIES TO THIS AGREEMENT EACH HEREBY AGREES AND
CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT THE PARTIES TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN 

  

 66 

 
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. 
 Section 14.9 Non-Recourse. No past, present or future director, officer, employee, incorporator, member, partner, shareholder, Affiliate,
agent, attorney or representative of Parent or Company or any of its Subsidiaries shall have any liability for any obligations or liabilities of Parent, Company or any of its Subsidiaries, as applicable, under this Agreement or for any claim based
on, in respect of, or by reason of, the transactions contemplated hereby. 
 Section 14.10 Company Disclosure Schedule; Supplemental
Disclosures. Disclosures in the Company Disclosure Schedule shall be disclosed in order of and with reference to the applicable Sections and subsections of the Agreement. If an item is disclosed in any part of the Company Disclosure Schedule and
the existence of such item or its contents are relevant to any other part of the Company Disclosure Schedule, then such item will be deemed to be disclosed in such other part of the Company Disclosure Schedule only to the extent such item or its
contents is reasonably apparent on its face that it would apply to the information called for by such other part of the Company Disclosure Schedule. No disclosure in the Company Disclosure Schedule shall be deemed an admission as to the materiality
of any item so disclosed. 
 Section 14.11 Counterparts. This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. The exchange of copies of this Agreement and of signature pages by facsimile transmission
shall constitute effective execution and delivery of this Agreement as to the parties and may be used in lieu of the original Agreement for all purposes. Signatures of the parties transmitted by facsimile shall be deemed to be their original
signatures for any purpose whatsoever. 
  

 67 

 IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as an instrument under
seal as of the date and year first above written. 
  

			
	TCFS HOLDINGS, INC.
		
	By	 	 /s/ W. Alvin New

	Name:	 	W. Alvin New
	Title:	 	President & CEO
	
	TCFS ACQUISITION CORPORATION
		
	By	 	 /s/ Sam L. Susser

	Name:	 	Sam L. Susser
	Title:	 	Chief Executive Officer
	
	SUSSER HOLDINGS CORPORATION
		
	By	 	 /s/ Sam L. Susser

	Name:	 	Sam L. Susser
	Title:	 	Chief Executive Officer
	
	 /s/ David Lloyd Norris

	 DAVID LLOYD NORRIS,
 individually
and as Shareholder Representative

	
	 /s/ Devin Lee Bates

	DEVIN LEE BATES
	
	 /s/ James Randal Brooks

	JAMES RANDAL BROOKS
	
	 /s/ Wylie Alvin New

	WYLIE ALVIN NEW

  

 68Sublease between Oracle USA, Inc. and Neurogesx, Inc.

 Exhibit 10.3 
 SUBLEASE 
 BETWEEN 
 ORACLE USA, INC. 
 AND 
 NEUROGESX, INC. 
 2215 Bridgepointe
Parkway, 
 San Mateo, California 
 (“Bridgepointe Building 1”) 
 Suite 200 
 Second (2nd) Floor 

 SUBLEASE 
 THIS SUBLEASE (“Sublease”) is entered into as of September 6, 2007, by and between ORACLE USA, INC., a Colorado corporation (“Sublandlord”) and NEUROGESX, INC., a Delaware corporation (“Subtenant”), with
reference to the following facts: 
 A. Pursuant to that certain Lease dated as of March 11, 1999 (the “Original Master
Lease”), as the same has been amended by that certain First Amendment to Lease dated as of June 11, 1999 (the “First Amendment”), by that certain Second Amendment to Lease dated as of July 31, 2000 (the “Second
Amendment”) and by that certain Third Amendment to Lease dated as of August 11, 2006 (the “Third Amendment”) (the Original Master Lease, as amended by the First Amendment, the Second Amendment and the Third Amendment, being
referred to herein as the “Master Lease”), Sobrato Interests III (“Landlord”), as Landlord, leases to Sublandlord (successor in interest to Siebel Systems, Inc.), as tenant, certain space (the “Master Lease Premises”)
consisting of the entire 141,496 rentable square foot building located at 2215 Bridgepointe Parkway in the City of San Mateo (“City”), State of California (the “Building” or “Building 1”). The Building, together with
(i) the 141,496 rentable square foot building located at 2211 Bridgepointe Parkway (“Building 2”) and (ii) the 167,505 rentable square foot building located at 2207 Bridgepointe Parkway (“Building 3”) comprise the
“Project,” as more particularly defined in the Master Lease. Pursuant to separate leases, Sublandlord has leased all of Building 2 and all of Building 3. 
 B. Subtenant wishes to sublease from Sublandlord, and Sublandlord wishes to sublease to Subtenant, a portion of the Master Lease Premises containing approximately 26,386 rentable square feet consisting of the entire
second (2nd) floor of the Building and designated Suite 200, said space being more particularly identified and described on the floor plan attached hereto as Exhibit A and incorporated herein by reference (the “Subleased
Premises”). 
 NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated by reference into this Sublease, and
for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged by the parties, Sublandlord and Subtenant hereby agree as follows: 
 1. Sublease. Sublandlord hereby subleases to Subtenant and Subtenant hereby subleases from Sublandlord for the term, at the rental, and upon all of the conditions set forth herein, the Subleased Premises and
grants Subtenant the non-exclusive right to use the Common Areas of the Project in compliance with the Master Lease and the provisions of this Sublease. 
 2. Term. 
 (a) Generally. The term of this Sublease (“Term”) shall commence on the
date (the “Commencement Date”) that is the later to occur of (i) July 1, 2007, (ii) seven (7) days following the date that Sublandlord delivers possession of the Subleased Premises to Subtenant in the condition required
hereunder, and (iii) seven (7) days following the date upon which Sublandlord procures Landlord’s consent to this Sublease as described in 

  

 1 

 
Section 29 below (the “Consent”, and the date upon which Sublandlord procures the Consent being the “Effective Date”) and end on
July 31, 2012 (the “Expiration Date”), unless sooner terminated pursuant to any provision hereof. Upon the determination of the Commencement Date, Sublandlord and Subtenant will enter into a letter agreement in the form of Exhibit
B attached hereto. 
 (b) Early Access. Subtenant and Subtenant’s representatives shall have the right to enter the
Subleased Premises during the period, if any, commencing on the Effective Date and ending on the day immediately preceding the Commencement Date (the date upon which Subtenant first has such access to the Subleased Premises being referred to herein
as the “Early Access Date”) for the sole purposes of construction of the Initial Subtenant Alterations (defined in Section 15.2(a) below), installation of Subtenant’s personal property and the testing of equipment, furniture,
fixtures and voice and data cabling, all subject to the terms, conditions and requirements of this Sublease. All of the rights and obligations of the parties under this Sublease (other than Subtenant’s obligation to pay Rent and utilities and
Subtenant’s maintenance and repair obligations, but expressly including without limitation, Subtenant’s obligation to carry insurance, Subtenant’s indemnification obligations, and/or Subtenant’s liability for damages, costs and
expenses incurred by Sublandlord by reason of any default by Subtenant or failure on Subtenant’s part to comply with the terms of this Sublease) shall commence upon the Early Access Date, and Subtenant shall be deemed to occupy the Subleased
Premises from and after the Early Access Date. Subtenant shall be liable for any damages to the Subleased Premises caused by Subtenant’s activities at the Subleased Premises from and after the Early Access Date and, prior to entering the
Subleased Premises, Subtenant shall obtain all insurance it is required to obtain hereunder and shall provide certificates of such insurance to Sublandlord. Subtenant shall coordinate such entry with Sublandlord, and such entry shall be made in
compliance with all terms and conditions of this Sublease, the Master Lease and the rules and regulations attached to the Master Lease. 
 3.
Rent. 
 3.1 Rent Payments. From and after the Commencement Date Subtenant shall pay to Sublandlord as base rent for the
Subleased Premises during the Term (“Base Rent”) as follows: 
  

									
	 Period
	  	 Monthly Base Rent
 Per Rentable
 Square
Foot
	  	 Rentable Square Foot
 Upon Which Base
 Rent is Payable

	  	 Monthly
 Base Rent

	 Months 1 - 5
	  	$	0.00	  	0	  	$	0.00
	 Months 6 - 12
	  	$	1.50	  	20,000	  	$	30,000.00
	 Months 13 - 24
	  	$	1.60	  	20,000	  	$	32,000.00
	 Months 25 - 36
	  	$	1.70	  	26,386	  	$	44,856.20
	 Months 37 - 48
	  	$	1.90	  	26,386	  	$	50,133.40
	 Months 49 - Expiration Date
	  	$	2.00	  	26,386	  	$	52,772.00

  

 2 

 As set forth in the table above, “Months 1-5” will be deemed to mean the initial one hundred fifty
(150) days of the Term, and the period described as “Months 7-12” will mean the period commencing with the one hundred fifty first (151st) day of the Term and expiring as of the date immediately preceding the first
(1st) anniversary of the Commencement Date (if such period includes a partial calendar month, Base Rent for such month will be payable based on the two rates applicable to such calendar month). As noted in the table set forth above, during the
initial twenty-four (24) months of the Term, Base Rent will be payable as if Tenant occupied less than all of the Subleased Premises; however, during such period Subtenant will be entitled to occupy all of the Subleased Premises. Base Rent
shall be paid on the first day of each month of the Term, except that Subtenant shall pay the first month’s Base Rent to Sublandlord upon execution and delivery of this Sublease to Sublandlord. If the Term does not end on the last day of a
calendar month, the Base Rent and Additional Rent (hereinafter defined) for any partial month shall be prorated by multiplying the monthly Base Rent and Additional Rent by a fraction, the numerator of which is the number of days of the partial month
included in the Term and the denominator of which is the total number of days in the full calendar month. All Rent (hereinafter defined) shall be payable in lawful money of the United States, by regular bank check of Subtenant, to Sublandlord at
the following address: 
 1001 Sunset Boulevard 
 Rocklin, CA 95765 
 Attn: Lease Administration 
 or to such other persons or at such other places as Sublandlord may designate in writing. 
 3.2 Operating Costs. Except as expressly set forth herein, it is intended that this Sublease be a “net” sublease, such that all Base Rent payable by Subtenant to Sublandlord hereunder will be
“net” of all costs to Sublandlord of operating and maintaining the Subleased Premises, the Building and the Project. Accordingly, Subtenant will be responsible for the payment of Subtenant’s Percentage Share (defined below) of both
those costs of operation and maintenance of the Building and Project which are payable by Sublandlord to Landlord under the Master Lease, as well as those costs of operation and maintenance of the Subleased Premises, Building and Project which are
Sublandlord’s direct responsibility under the Master Lease. The definitions and procedures set forth in this Section 3.2 will govern Subtenant’s payment to Sublandlord of such costs. 
 (a) Definitions. The following terms shall have the meanings set forth below: 
 (1) “Additional Rent” shall mean the sums payable pursuant to Section 3.2(b) below. 
 (2) “Operating Costs” shall mean the aggregate of (i) Landlord Operating Costs and (ii) Sublandlord Operating Costs, each
defined below. 
 (A) “Landlord Operating Costs” shall mean (i) Reimbursable Operating Costs (as such term is defined
in the Master Lease) attributable to the Building, as described in Sections 8.C and 8.E of the Original Master Lease; (ii) Reimbursable 

  

 3 

 
Operating Costs attributable to the Project, as described in Sections 8.C and 8.E of the Original Master Lease, (iii) taxes payable by Sublandlord
pursuant to Section 10 of the Original Master Lease, but excluding any taxes on Sublandlord’s personal property unless the same are properly included in Sublandlord Operating Costs, as well as (iv) costs payable by Sublandlord
pursuant to Section 21.W of the Original Master Lease; provided that Landlord Operating Costs will not: 
 (i) include the cost of
capital improvements constructed by Landlord except to the extent that the same are, for the purposes of this Sublease, amortized (as described in Section 3.2(a)(2)(B)(i) below, provided that the limitation described in clauses (x),
(y) and (z) of Section 3.2(a)(2)(B)(i) will not apply) by Sublandlord prior to inclusion in Landlord Operating Costs, regardless of whether or not such costs are similarly amortized by Landlord for the purpose of charging the same to
Sublandlord pursuant to the Master Lease; or 
 (ii) include costs arising from the presence, clean-up or remediation of any Hazardous
Materials, except to the extent caused by Subtenant, its employees, agents or contractors; or 
 (iii) include the cost of bringing the
Building and/or the Subleased Premises into compliance with the laws as existing and enforced against the Building as of the Commencement Date. 
 (B) “Sublandlord Operating Costs” shall mean (i) costs incurred by Sublandlord in complying with Sublandlord’s obligations as set forth in Section 8.B of the Original Master Lease, (ii) costs of
utilities paid by Sublandlord pursuant to Section 11 of the Original Master Lease, and (iii) all other costs of Sublandlord incurred in the operation, maintenance, repair and replacement of any portion of the Building and/or Project
(including, without limitation, any commercially reasonable out-of-pocket property management fee paid by Sublandlord to any entity performing management services at the Property and the fair market rental value of any reasonable-sized property
management office serving the Project, as well as the cost of providing the Project Amenities to the extent allowable pursuant to Section 3.3 below). Notwithstanding the foregoing to the contrary, Sublandlord Operating Costs will not include
the following: 
 (i) the cost of capital improvements constructed by Sublandlord, except that Sublandlord Operating Costs will include the
amortized cost of capital improvements constructed by Sublandlord (x) in order to comply with laws, rules or regulations first enacted or enforced against the Building or Project after the Commencement Date, or (y) to cause a reduction in
one or more components in Sublandlord Operating Costs if Sublandlord in good faith believes the amortized cost of such improvements will approximate or be less than the cost savings over the useful life of the item in question or (z) to replace
items which Sublandlord is obligated to maintain under the Master Lease or this Sublease. As used in this Section 3.2(a)(2)(B)(i), “amortization” shall mean allocation of the cost (together with reasonable financing charges) of the
item being amortized equally to each year of the useful life of such item, as reasonably determined by Sublandlord; 
  

 4 

 (ii) any costs or expenses for which Sublandlord is reimbursed by insurance or condemnation proceeds or
by a third party (other than by subtenants as part of Operating Costs); 
 (iii) costs in connection with subleasing space in the Building
or Project, including brokerage commissions and legal expenses; 
 (iv) lease concessions, including rental abatements and construction
allowances, granted to specific subtenants; 
 (v) any penalties or damages that Sublandlord pays to Subtenant under this Sublease or to
other occupants in the Project under their respective subleases; 
 (vi) costs incurred in connection with disputes between Sublandlord and
its employees or between Sublandlord and other subtenants or Project occupants; 
 (vii) the wages and benefits of any employee who does not
devote substantially all of his or her employed time to the Project unless such wages and benefits are prorated to reflect time spent on operating and managing the Project vis-á-vis time spent on matters unrelated to operating and managing
the Project; 
 (viii) any amounts paid by Sublandlord to its parent organization or to a subsidiary or affiliate of Sublandlord for
supplies and/or services rendered in connection with the Project to the extent the same materially exceed the costs of such supplies and/or services rendered by qualified, first-class unaffiliated third parties on a competitive basis; 
 (ix) any amount paid by Sublandlord for items and services for which Subtenant or any other occupant in the Project directly reimburses Sublandlord
pursuant to their respective subleases (i.e., other than by payment of Operating Costs); 
 (x) acquisition costs (not including those
incurred in ordinary maintenance and repair) for sculpture, paintings or other objects of art; 
 (xi) costs arising from the presence,
clean-up or remediation of any Hazardous Materials, except to the extent caused by Subtenant, its employees, agents or contractors; 
 (xii)
penalties, interest and fines incurred as a result of Sublandlord’s failure to make payments and/or to file any tax or informational returns when due; 
 (xiii) any personal property taxes of Sublandlord for equipment or items not used in the operation or maintenance of the Building or Project, nor connected therewith; 
  

 5 

 (xiv) the cost of bringing the Building and/or the Subleased Premises into compliance with laws as
existing and enforced as of the Commencement Date; 
 (xv) any costs (other than property management fees) of a type excluded from
Reimbursable Operating Costs pursuant to Section 8.F of the Original Master Lease; or 
 (xvi) costs for renovating, reconfiguring or
remodeling (as opposed to costs of operation, maintenance and replacement) any other premises in the Project or of the Common Areas of the Project, including the Project Amenities. 
 (C) If, for thirty (30) or more days during any calendar year, less than ninety-five percent (95%) of the rentable area of the Building is
occupied by subtenants, then the Sublandlord Operating Costs for such calendar year that depend on occupancy shall be deemed to be an amount equal to the Sublandlord Operating Costs which would normally be expected to have been incurred had the
Building been at least ninety-five percent (95%) occupied throughout such year, as reasonably determined by Sublandlord (i.e., taking into account that certain expenses depend on occupancy (e.g., janitorial) and certain expenses do not (e.g.,
landscaping)). Furthermore, if Sublandlord shall not furnish any item or items of service the cost of which is included in Sublandlord Operating Costs to any portions of the Building because such portions are not occupied or because such item is not
required by the occupant of such portion of the Building or such occupant is providing such service independently, then, for the purposes of computing Sublandlord Operating Costs, an equitable adjustment shall be made so that the cost of the item in
question shall be shared only by occupants actually receiving the benefits thereof. 
 (3) “Rent” shall mean, collectively,
Base Rent, Additional Rent, and all other sums payable by Subtenant to Sublandlord under this Sublease, whether or not expressly designated as “rent”, all of which are deemed and designated as rent pursuant to the terms of this Sublease.
Base Rent and Additional Rent are payable hereunder in advance without setoff, deduction, notice or demand. Unless expressly set forth to the contrary in this Sublease, all other amounts payable by Subtenant hereunder are payable within thirty
(30) days following Sublandlord’s delivery of an invoice therefor to Subtenant. 
 (4) “Subtenant’s Percentage
Share” shall mean, as applicable given the context, Subtenant’s Building Percentage Share and/or Subtenant’s Project Percentage Share, as follows: 
 (A) “Subtenant’s Building Percentage Share” shall mean 18.65%, which is derived by dividing the rentable area of the Subleased Premises by the rentable area of the Building and multiplying the
quotient by 100. Subtenant’s Building Percentage Share will be applicable to Landlord Operating Costs attributable solely to the Building and Sublandlord Operating Costs attributable to the Building (and not attributable to other buildings in
the Project or to the Project generally). 
  

 6 

 (B) “Subtenant’s Project Percentage Share” shall mean 5.86%, which is derived by
dividing the rentable area of the Subleased Premises by the rentable area of the Project and multiplying the quotient by 100. Subtenant’s Project Percentage Share will be applicable to Landlord Operating Costs attributable to the Project
generally and Sublandlord Operating Costs attributable to the Project generally (and not to any specific building in the Project). 
 (b)
Payment of Operating Costs. In addition to the Base Rent payable hereunder, from and after the Commencement Date, for each full or partial calendar year of the Term, Subtenant, as Additional Rent, shall pay the applicable Subtenant’s
Percentage Share of Operating Costs for the then current calendar year. For the calendar year 2007, Sublandlord’s initial estimate is that Operating Costs will equal $.93 per rentable square foot per month. 
 (c) Procedure. The determination and adjustment of Additional Rent payable hereunder shall be made in accordance with the following procedures:

 (1) Landlord Operating Costs. Sublandlord shall give Subtenant written notice of its estimate of the amount of Subtenant’s
Building Percentage Share of Landlord Operating Costs attributable solely to the Building and Subtenant’s Project Percentage Share of Landlord Operating Costs attributable to the Project generally payable for each calendar year; such estimate
may be aggregated with Sublandlord’s estimate of Sublandlord Operating Costs payable for such year. Subtenant may amend such estimate in good faith from time to time during any calendar year. On or before the first day of each calendar month
during each full or partial calendar year throughout the Term, Subtenant shall pay to Sublandlord as Additional Rent one-twelfth (1/12th) of such estimated amount. If for any reason Sublandlord has not provided Subtenant with an estimate of the
amount of Subtenant’s Percentage Share of Landlord Operating Costs on or before the first day of January of any calendar year during the Term, then (a) until the first day of the calendar month following the month in which Sublandlord
delivers such estimate, Subtenant shall continue to pay to Sublandlord on the first day of each calendar month the sum payable by Subtenant under this Section 3.2(c)(1) for the month of December of the preceding year, and (b) together with
such estimate, Sublandlord shall give notice to Subtenant stating whether the installments of Landlord Operating Costs payments previously made for such year were greater or less than the installments of Landlord Operating Costs payments to be made
for such year, and (i) if there shall be a deficiency, Subtenant shall pay the amount thereof to Sublandlord within thirty (30) days after the delivery of Sublandlord’s estimate, or (ii) if there shall have been an overpayment,
Sublandlord shall apply such overpayment as a credit against the next accruing monthly installment(s) of Rent due from Subtenant until fully credited to Subtenant or, at Sublandlord’s discretion, Sublandlord may pay the amount thereof to
Subtenant by check, and (c) on the first (1st) day of the calendar month following the month in which Sublandlord’s estimate is given to Subtenant and on the first day of each calendar month throughout the remainder of such calendar
year, Subtenant shall pay to Sublandlord an amount equal to one-twelfth (1/12th) of the new Landlord Operating Costs payment, as described above. Subtenant’s estimated payments of Subtenant’s Percentage Share of Landlord Operating
Costs shall be reconciled from time to time with the actual amounts thereof due as and when Sublandlord is notified by Landlord of the actual amounts of Landlord Operating Costs; and Sublandlord will deliver to Subtenant a copy of any such notice(s)
from Landlord upon which such reconciliation may be based. 
  

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 (2) Sublandlord Operating Costs. 
 (A) Sublandlord’s Estimate. On or about the Commencement Date, and on the first day of January of each subsequent full or partial calendar
year during the Term, or as soon thereafter as is practicable, Sublandlord shall furnish Subtenant with a statement setting forth in reasonable detail Sublandlord’s estimate of Sublandlord Operating Costs for the calendar year in which the
Commencement Date occurs or the forthcoming calendar year, as applicable; such estimate may be aggregated with Sublandlord’s estimate of Sublandlord Operating Costs payable for such year. On or before the first day of each calendar month during
such year, Subtenant shall pay to Sublandlord as Additional Rent (i) one-twelfth (1/12th) of Subtenant’s Building Percentage Share of the estimated Sublandlord Operating Costs attributable solely to the Building and (ii) one
twelfth (1/12) of Subtenant’s Project Percentage Share of the estimated Sublandlord Operating Costs attributable to the Project generally (as such estimate may be modified from time to time by Sublandlord). If for any reason Sublandlord
has not provided Subtenant with an estimate of Sublandlord Operating Costs on or before the first day of January of any calendar year during the Term, then (a) until the first day of the calendar month following the month in which Subtenant is
given Sublandlord’s estimate, Subtenant shall continue to pay to Sublandlord on the first day of each calendar month the sum payable by Subtenant under this Section 3.2(c)(2)(A) for the month of December of the preceding year, and
(b) promptly after Sublandlord’s estimate is furnished to Subtenant, Sublandlord shall give notice to Subtenant stating whether the installments of Sublandlord Operating Costs payments previously made for such year were greater or less
than the installments of Sublandlord Operating Costs payments to be made for such year, and (i) if there shall be a deficiency, Subtenant shall pay the amount thereof to Sublandlord within thirty (30) days after the delivery of
Sublandlord’s estimate, or (ii) if there shall have been an overpayment, Sublandlord shall apply such overpayment as a credit against the next accruing monthly installment(s) of Rent due from Subtenant until fully credited to Subtenant or,
at Sublandlord’s discretion, Sublandlord may pay the amount thereof to Subtenant by check, and (c) on the first (1st) day of the calendar month following the month in which Sublandlord’s estimate is given to Subtenant and on the
first day of each calendar month throughout the remainder of such calendar year, Subtenant shall pay to Sublandlord an amount equal to one-twelfth (1/12th) of the new Sublandlord Operating Costs payment, as described above. 
 (B) Reconciliation of Sublandlord Operating Costs. On or about the first day of March of each calendar year, or as soon thereafter as is
reasonably practicable, Sublandlord will furnish Subtenant with a statement of the actual Sublandlord Operating Costs for the preceding year, reconciling the actual amounts paid pursuant to Sublandlord’s estimate and the actual amounts payable
hereunder. Within thirty (30) days after Sublandlord’s delivery of such statement, Subtenant shall make a lump sum payment to Sublandlord in the amount, if any, by which Subtenant’s Percentage Share of Sublandlord Operating Costs for
such preceding year, as shown on such statement, exceeds the aggregate of the monthly installments of Subtenant’s Percentage Share of Sublandlord Operating Costs paid during such preceding year. If Subtenant’s Percentage Share of
Sublandlord Operating Costs, as shown on such statement, is less than the aggregate of the monthly installments of Subtenant’s 

  

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Percentage Share of Sublandlord Operating Costs actually paid by Subtenant during such preceding year, then Sublandlord shall apply such amount to the next
accruing monthly installment(s) of Rent due from Subtenant until fully credited to Subtenant. Sublandlord’s failure to deliver or delay in delivering a statement of actual Sublandlord Operating Costs with respect to any calendar year shall in
no event be construed as Sublandlord’s waiver of the right to so deliver such statement or collect Subtenant’s Percentage Share of Sublandlord Operating Costs as described herein, nor shall it be construed as a waiver of Subtenant’s
obligation to pay such amounts. Upon request by Subtenant, Sublandlord will reasonably consult with Subtenant with respect to questions Subtenant may have with respect to any Operating Costs. 
 (C) Subtenant’s Audit Right. Provided that Subtenant is not in default hereunder and has paid all amounts due hereunder (including all
Additional Rent), Subtenant may, one hundred twenty (120) days after receiving Sublandlord’s annual statement of Sublandlord Operating Costs, give Sublandlord written notice (“Review Notice”) that Subtenant intends to cause an
independent, nationally recognized certified public accountant who charges for its services on an hourly basis and is not compensated on a so-called “contingency” basis (a “Third Party Auditor”) to inspect, during normal business
hours, Sublandlord’s accounting records with respect to Sublandlord Operating Costs for the calendar year covered by such statement (the “Subtenant Review”); provided, however, that, as a condition precedent to any such inspection,
Subtenant shall deliver to Sublandlord a copy of Subtenant’s written agreement with such Third Party Auditor, which agreement shall include provisions which state that (i) such Third Party Auditor will not in any manner solicit or agree to
represent any other occupant of the Project with respect to an audit or other review of Sublandlord’s accounting records at the Project, (ii) Subtenant and such Third Party Auditor shall maintain in strict confidence any and all
information obtained in connection with the Subtenant Review and shall not disclose such information to any person or entity other than to the legal representatives and management personnel of Subtenant or as required by law, and
(iii) Sublandlord is an intended third-party beneficiary of such agreement. Within a reasonable time (not to exceed sixty (60) days) after receipt of the Review Notice, Sublandlord shall make pertinent records available for inspection that
are reasonably necessary for Subtenant to conduct its review. If any such records are maintained at a location other than the office of the Project, Subtenant may either inspect the records at such other location or pay for the reasonable cost of
copying and shipping the records. Subtenant shall be solely responsible for all costs, expenses and fees incurred for the Subtenant Review. Within sixty (60) days after the records are made available to Subtenant, Subtenant shall have the right
to give Sublandlord written notice (an “Objection Notice”) stating in reasonable detail any objection to Sublandlord’s statement of Sublandlord Operating Costs for the applicable year. If Subtenant fails to give Sublandlord an
Objection Notice within such sixty (60) day period or fails to provide Sublandlord with a Review Notice within the one hundred twenty (120) day period described above, Subtenant shall be deemed to have approved Sublandlord’s statement
of Sublandlord Operating Costs and shall be barred from raising any claims regarding Sublandlord Operating Costs for that calendar year. If Subtenant provides Sublandlord with a timely Objection Notice, Sublandlord and Subtenant shall work together
in good faith to resolve any issues raised in Subtenant’s Objection Notice. If Sublandlord and Subtenant determine that Subtenant’s Percentage Share of Sublandlord Operating Costs for the calendar year was overstated by Sublandlord,
Sublandlord shall provide Subtenant with a credit against Subtenant’s Percentage Share of Sublandlord Operating Costs next coming due in the amount of the overpayment by Subtenant. If Sublandlord and Subtenant determine that 

  

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Subtenant’s Percentage Share of Sublandlord Operating Costs for the calendar year was understated by Sublandlord, Subtenant shall pay Sublandlord the
amount of any underpayment within thirty (30) days thereafter. The parties’ sole remedy for an error in the determination of Subtenant’s Percentage Share of Sublandlord Operating Costs for any full or partial calendar year shall be
for the parties to make appropriate payments or credits, as the case may be, to each other as set forth above. Subtenant shall be responsible for all costs and expenses associated with Subtenant’s Review, and Subtenant shall be responsible for
all audit fees, attorneys’ fees and other costs of Subtenant relating to the resolution of any dispute pursuant to this Section (collectively, the “Costs”), provided that if the parties’ final resolution of the dispute concludes
that Sublandlord overstated Sublandlord Operating Costs for such year by an amount in excess of five percent (5%) of actual Sublandlord Operating Costs, then Sublandlord shall be responsible for the Costs. 
 (d) Survival. The expiration or earlier termination of this Sublease shall not affect the rights and obligations of Sublandlord and Subtenant
pursuant to this Section 3.2, and such obligations shall survive any expiration or earlier termination of this Sublease. 
 3.3
Project Amenities Costs. Sublandlord will provide certain Project amenities (the “Project Amenities”) to occupants of the Project, including a fitness center (located in Building 2), conference room (anticipated to be located in
Building 3) and cafeteria (located in the Building ) and, at Sublandlord’s discretion, a day care center. It is anticipated that once occupancy in the Project equals 100,000 rentable square feet or more, Sublandlord will commence operations of
the proposed fitness center, conference room and limited cafeteria operations (limited operations means that pre-cooked or pre-prepared food and beverages will be available for sale, but full kitchen cooking operations will not yet commence); at
such point as occupancy levels meet or exceed 250,000 rentable square feet, full cafeteria operations are anticipated to commence. The pro-rata cost of providing the Project Amenities (“Project Amenities Costs”) will be included within
Sublandlord Operating Costs but only when such services are available to Subtenant, with the pro-rata allocation to be determined by dividing the rentable area of the Subleased Premises by the rentable area of the Project, net of the rentable area
of the Project Amenities; provided that in no event will Subtenant be required to pay more for Project Amenities on a per rentable square foot basis than any other Project occupant and all such costs shall be treated as costs attributable to the
Project (regardless of whether such amenity is located in the Building) such that Subtenant shall only be responsible for Tenant’s pro rata allocation (calculated as described above) of such costs. Notwithstanding the foregoing, each employee
of any Project occupant who desires to use the fitness center, will be required to pay a monthly fee (initially, $25.00 per month, but such fee may be adjusted from time to time by Sublandlord to account for increases in costs of operation of the
fitness center) for the right to use the fitness center. Sublandlord will offset all such fees collected against the portion of Project Amenities Costs attributable to the fitness center and which would otherwise be included in Sublandlord Operating
Costs. Any renovation, reconfiguration or remodeling of the common areas of the Project shall be performed in a manner so as not to unreasonably interfere with Subtenant’s use of or access to the Subleased Premises or Subtenant’s parking
rights. Sublandlord shall operate said cafeteria in a commercially reasonable manner. Within two (2) months of the Commencement Date, Sublandlord shall: (a) remove all of the chairs and tables from the lobby of the Building; and
(b) enclose the cafeteria, including installing a door on the 

  

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main cafeteria entrance. In addition, Sublandlord will use commercially reasonable efforts to prevent unreasonable amounts of noise or odors from the
cafeteria to become noticeable in the Subleased Premises. 
 4. Letter of Credit: 
 (a) Initial Letter of Credit. Concurrently with execution hereof, Subtenant has delivered to Sublandlord an unconditional, irrevocable,
transferable standby letter of credit (the “Initial Letter of Credit”) in the form attached hereto as Exhibit D in the amount of $240,000.00 and issued by a financial institution acceptable to Sublandlord (which must have a credit
rating of “AA” or better from both Moody’s and Standard & Poor’s), as security for the full and faithful performance of Subtenant’s obligations under this Sublease. Sublandlord may draw upon the Initial Letter of
Credit or any Replacement Letter of Credit (as that term is defined below) on or after the occurrence of either: (i) an uncured event of default under this Sublease; (ii) any failure by Subtenant to deliver to Sublandlord a Replacement
Letter of Credit as and when required pursuant to this Section 4; provided that in the event of (i), Sublandlord may, at Sublandlord’s sole option, draw upon a portion of the face amount of the Initial Letter of Credit or any Replacement
Letter of Credit, as applicable, but in the case of (i) above, only to the extent required to compensate Sublandlord for damages incurred (with subsequent demands at Sublandlord’s sole election as Sublandlord incurs further damage).

 (b) Delivery of Replacement Letter of Credit. Subtenant shall deliver to Sublandlord a renewal of the Initial Letter of Credit or
a new letter of credit (a “Replacement Letter of Credit”) (the Initial Letter of Credit and any Replacement Letter of Credit being referred to herein as a “Letter of Credit”) at least thirty (30) days prior to the expiry
date of the Initial Letter of Credit or of any Replacement Letter of Credit held by Sublandlord. Each Replacement Letter of Credit delivered by Subtenant to Sublandlord shall: (i) be issued by a banking institution acceptable to Sublandlord in
its reasonable judgment; (ii) be in the same form as the letter of credit attached to this Sublease as Exhibit D; (iii) bear an expiry date not earlier than one (1) year from the date when such Replacement Letter of Credit is
delivered to Sublandlord; and (iv) be in an amount not less than the amount specified in Section 4(a). Upon the delivery to Sublandlord of a Replacement Letter of Credit as described in this Section 4(b), Sublandlord shall return the
Initial Letter of Credit or any previous Replacement Letter of Credit then held by Sublandlord to the issuing bank. In any event, Subtenant will be obligated to maintain either the Initial Letter of Credit or a Replacement Letter of Credit until the
date that is thirty (30) days following the Expiration Date. 
 (c) Draw Upon Letter of Credit. All proceeds of a draw upon a
Letter of Credit shall be, at Sublandlord’s sole election, either: (i) applied by Sublandlord to damages incurred by Sublandlord as a result of the event giving rise to the draw, or (ii) in the event Sublandlord draws on the Letter of
Credit due to Subtenant’s failure to provide a Replacement Letter of Credit as required above or Sublandlord has excess funds remaining from a draw upon the Letter of Credit after the application described in clause (i) above, held by
Sublandlord as a security deposit, and, at the sole election of Sublandlord, applied on one or more occasions to compensate Sublandlord for any foreseeable or unforeseeable loss or damage caused by the act or omission of Subtenant or
Subtenant’s officers, agents, employees, independent contractors, or invitees (including, without limitation, to remedy defaults in the 

  

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payment of rent, to repair damage caused by Subtenant or to clean the Subleased Premises.) In the case of clause (ii) above, no trust relationship will
be created herein between Sublandlord and Subtenant with respect to the security deposit, and Subtenant hereby waives any and all rights under and the benefits of Section 1950.7 of the California Civil Code, and all other provisions of law now
in force or that become in force after the date of execution of this Sublease, to the extent that such laws provide that Sublandlord may claim from a security deposit only those sums reasonably necessary to remedy defaults in the payment of rent, to
repair damage caused by Subtenant, or to clean the Subleased Premises. If Sublandlord draws upon a Letter of Credit solely due to Subtenant’s failure to renew a Letter of Credit at least thirty (30) days before its expiration (i) such
failure to renew shall not constitute a default hereunder and (ii) Subtenant shall at any time thereafter be entitled to provide Sublandlord with a Replacement Letter of Credit that satisfies the requirements hereunder, at which time
Sublandlord shall return the cash proceeds of the original Letter of Credit drawn by Sublandlord. If Sublandlord is adjudicated to have improperly drawn upon a Letter of Credit or misapplied the proceeds, and Sublandlord does not promptly return the
funds in question to Subtenant following such adjudication, Subtenant shall have the right to offset such amounts against Rent next due and payable hereunder. 
 (d) Sublandlord’s Transfer. If Sublandlord conveys or transfers its interest in the Subleased Premises and, as a part of such conveyance or transfer, Sublandlord assigns its interest in this Sublease:
(i) the Initial Letter of Credit or any Replacement Letter of Credit shall be transferred to Sublandlord’s successor; (ii) provided the successor assumes in writing all of Sublandlord’s obligations under this Sublease.
Sublandlord shall be released and discharged from any further liability to Subtenant with respect to such Initial Letter of Credit and any Replacement Letter of Credit; (iii) Subtenant will be responsible for the payment of any transfer fee or
charge imposed by the issuing bank and (iv) any Replacement Letter of Credit thereafter delivered by Subtenant shall state the name of the successor to Sublandlord as the beneficiary of such Replacement Letter of Credit and shall contain such
modifications in the text of the Replacement Letter of Credit as are required to appropriately reflect the transfer of Sublandlord’s interest in the Subleased Premises. 
 (e) Reduction. Notwithstanding the foregoing provisions of this Section 4 to the contrary, if, as of each of the first three
(3) anniversaries of the Commencement Date (each, an “Adjustment Date”), the Reduction Conditions apply, then, upon written request by Subtenant, the face amount of the then-current Letter of Credit may be reduced by an amount equal
to $40,000.00 on each Adjustment Date (such reduction to be accomplished either by an amendment of the then-current Letter of Credit or by Subtenant’s delivery to Sublandlord of a Replacement Letter of Credit in the reduced face amount, at
which time the Sublandlord will return the then-current Letter of Credit to Subtenant); provided that the face amount of the Letter of Credit will remain subject to potential increase pursuant to the provisions of Section 15.2(a) below. As used
herein, the “Reduction Conditions” shall mean that (i) Subtenant is not then in default hereunder (beyond the giving of applicable notice and the passage of applicable grace periods), (ii) Subtenant has not previously been in
default (similarly defined) hereunder and (iii) no notice of default has been issued by Sublandlord to Subtenant pursuant to which, with the passage of additional time, Subtenant would be in default hereunder. 
  

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 5. Use and Occupancy. 
 5.1 Use. The Subleased Premises shall be used and occupied only for general office use, and for no other use or purpose without Sublandlord’s
prior written consent which may be predicated upon receipt of Landlord’s prior written consent. 
 5.2 Compliance with Master
Lease. 
 (a) By Subtenant. Subtenant agrees that it will occupy the Subleased Premises in accordance with the terms of the Master
Lease and will not suffer to be done or omit to do any act which may result in a violation of or a default under any of the terms and conditions of the Master Lease, or render Sublandlord liable for any damage, charge or expense thereunder as a
result of any such violation or default. Subtenant further covenants and agrees to indemnify Sublandlord against and hold Sublandlord harmless from any claim, demand, action, proceeding, suit, liability, loss, judgment, expense (including attorneys
fees) and damages of any kind or nature whatsoever arising out of, by reason of, or resulting from, Subtenant’s failure to perform or observe any of the terms and conditions of the Master Lease or this Sublease. Any other provision in this
Sublease to the contrary notwithstanding, Subtenant shall pay to Sublandlord as Rent hereunder any and all sums which Sublandlord may be required to pay Landlord to the extent arising out of a request by Subtenant for, or use by Subtenant of,
additional or over-standard Building services from Landlord (for example, but not by way of limitation, charges associated with after-hours HVAC usage and overstandard electrical charges). 
 (b) By Sublandlord. Sublandlord agrees that it will perform its obligations under the Master Lease during the Term and will not amend or modify
the Master Lease in any way or take any action under the Master Lease which would increase Subtenant’s obligations hereunder (other than in a de minimus way, such as requiring Subtenant to send notices to an additional address, etc.) or
materially adversely affect Subtenant’s rights hereunder. Without limitation, Sublandlord agrees that it will not terminate the Master Lease without the prior written consent of Subtenant, except as Sublandlord may be entitled to terminate the
Master Lease in the event of casualty or condemnation. Sublandlord represents to Subtenant that the Master Lease is in full force and effect and Sublandlord has neither given nor received a notice of default under the Master Lease. Subject to the
provisions of Section 9.D of the Original Master Lease as incorporated herein by reference by Section 8.2 below and to the provisions of clause (b) of Section 13 below, Sublandlord shall indemnify, defend, protect and hold
harmless Subtenant harmless from, all damages, liabilities, losses, claims, attorneys’ fees, costs and expenses arising from the negligence or willful misconduct of Sublandlord or its agents or contractors or a breach of Sublandlord’s
obligations under this Sublease or the Master Lease. 
 (c) Master Lease Renewal. Sublandlord will not exercise its rights to renew
the Master Lease. 
 5.3 Rules and Regulations. Subtenant shall comply with the rules and regulations for the Building attached
hereto as Exhibit E and such amendments or supplements thereto as Sublandlord may adopt from time to time with prior notice to Subtenant (the “Rules and Regulations”), and with all recorded covenants, conditions and restrictions now
or hereafter affecting the Building or the Project (collectively, “CC&Rs”) that do not prohibit Subtenant’s 

  

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use of the Subleased Premises for general office use and to the extent the same do not materially adversely increase Subtenant’s obligations or
materially adversely decrease Subtenant’s rights under this Sublease. Subtenant shall also cause its agents, contractors, subcontractors, employees, customers, and subtenants to comply with all Rules and Regulations and CC&Rs.
Notwithstanding the foregoing, Sublandlord agrees that (i) any Rules and Regulations promulgated by Sublandlord shall not be unreasonably modified or amended or enforced in a manner which will unreasonably interfere with the normal and
customary conduct of Subtenant’s business and no Rule or Regulation shall unreasonably or materially interfere with Subtenant’s permitted use, (ii) Sublandlord shall provide Subtenant with reasonable advance notice of any
CC&R’s and any modification or amendment of the Rules and Regulations or CC&R’s, and (iii) in the event of a conflict between the Rules and Regulations and the provisions of this Sublease, the provisions of this Sublease will
control; Subtenant acknowledges that it has received a copy of the current (as of the date of this Sublease) CC&R’s. Without limitation on the foregoing, Subtenant acknowledges that CC&R’s may provide for some or all of the Project
Common Areas to be transferred to a property owners’ association which will assume the obligation to cause to be operated and maintained some or all of the Project common areas (typically, through a property management/maintenance company
retained by the property owners’ association in respect of such obligations); in such event, any costs incurred by Sublandlord to pay such property owners’ association fee will be included in Operating Costs subject to the terms of
Section 3.2 above. Sublandlord shall not be liable to Subtenant for or in connection with the failure of any other tenant of the Building or Project to comply with any rules and regulations applicable to such other occupant under its lease or
sublease. 
 5.4 Landlord’s Obligations. Subtenant agrees that Sublandlord shall not be required to perform any of the
covenants, agreements and/or obligations of Landlord under the Master Lease and, insofar as any of the covenants, agreements and obligations of Sublandlord hereunder are required to be performed under the Master Lease by Landlord thereunder,
Subtenant acknowledges and agrees (without otherwise limiting Sublandlord’s express obligations hereunder) that Sublandlord shall be entitled to look to Landlord for such performance. In addition, Sublandlord shall have no obligation to perform
any repairs or any other obligation of Landlord under the Master Lease. Except as expressly set forth herein, Sublandlord shall not be responsible for any failure or interruption, for any reason whatsoever, of the services or facilities that may be
appurtenant to or supplied at the Building or Project by Landlord, and no failure to furnish, or interruption of, any such services or facilities shall give rise to any (i) abatement, diminution or reduction of Subtenant’s obligations
under this Sublease, or (ii) liability on the part of Sublandlord. Notwithstanding the foregoing, Sublandlord shall promptly take such action as may reasonably be indicated, under the circumstances, to secure such performance upon
Subtenant’s request to Sublandlord to do so and shall thereafter use diligent efforts to secure timely completion of such performance by Landlord. 
 5.5 Maintenance. 
 (a) Sublandlord’s Maintenance. Sublandlord shall keep and maintain in
good repair and working order and make repairs to and perform maintenance upon: (1) all structural elements and components of the Building, including the roof and the roof membrane (except to the extent that the responsibility for such work is
Landlord’s pursuant to the Master Lease); (2) mechanical (including HVAC), electrical, plumbing and fire/life safety 

  

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systems serving the Building in general and/or the Subleased Premises (but not any such systems which serve the Subleased Premises exclusively); (3) the
“Building Common Areas” (i.e., those areas within the Building devoted to corridors, elevator lobbies, vending areas and lobby areas (whether at ground level or otherwise), and other similar facilities provided for the common use or
benefit of tenants generally and/or the public (Building Common Areas will not include, but Sublandlord will be responsible for the maintenance of, those areas within the Building used for elevator shafts, flues, vents, stacks, pipe shafts, risers
and other vertical penetrations, mechanical rooms, elevator mechanical rooms, janitorial closets, electrical and telephone closets, mail rooms and similar areas in the Building not designated for the exclusive use of a particular tenant or for the
common use of tenants in general (except to the extent that the responsibility for such work is Landlord’s pursuant to the Master Lease)); (4) exterior windows of the Building; (5) elevators serving the Building; and (6) Building
standard lighting fixtures (i.e., lamp and ballasts) within the Subleased Premises. Sublandlord shall not be responsible for, and Subtenant shall reimburse Sublandlord within ten (10) business days after demand from Sublandlord, for the cost of
any repairs of damage caused by any negligent or intentional act or omission of Subtenant or any of Subtenant’s employees, contractors, invitees, sub-subtenants or agents or because of use of the Subleased Premises for other than normal and
customary office operations. Sublandlord shall perform its obligations under this Section 5.5(a) within a reasonable time (considering the nature and urgency of the repair) after Sublandlord receives written notice of the need for such repairs
or maintenance; provided, however, that such notice shall not be required for repairs outside of the Subleased Premises or regularly scheduled periodic maintenance and repairs. Notwithstanding anything to the contrary contained in this Sublease,
except as provided in Section 6.2 below or as otherwise expressly provided in this Sublease, Sublandlord shall not be liable for and there shall be no abatement of rent with respect to, any injury to or interference with Subtenant’s
business arising from any performance or nonperformance of any repair, maintenance, alteration or improvement in and to any portion of the Project, Building or the Subleased Premises, no actual or constructive eviction of Subtenant shall result from
such performance or nonperformance, Subtenant shall not have the right to terminate this Sublease, and Subtenant shall not be relieved from the performance of any covenant or agreement in this Sublease by reason thereof. Subtenant hereby waives and
releases its right to make repairs at Sublandlord’s expense under Sections 1932(1), 1933(4), 1941 and 1942 of the California Civil Code or any similar or successor laws now or hereinafter in effect. 
 (b) Subtenant’s Maintenance. Subtenant shall, at its sole cost and expense, keep the Subleased Premises in good condition and repair,
reasonable wear and tear and repairs that are the express responsibility of Sublandlord under this Sublease or of Landlord under the Master Lease excepted. Subtenant’s repair obligations include, without limitation, repairs to: (1) the
interior side of demising walls; (2) doors; (3) floor coverings; (4) interior partitions, interior glass, interior window treatments, ceiling tiles, shelving, cabinets, millwork and other tenant improvements; (5) electronic,
phone and data cabling and related switches and transmission lines (collectively, “Network Cabling”) that is installed by or for the exclusive benefit of Subtenant and located in the Subleased Premises or other portions of the Building or
Project; (6) supplemental air conditioning units installed by or for the benefit of Subtenant or otherwise serving the Subleased Premises exclusively (the parties acknowledge that as of the date of this Sublease there are no such supplemental
air conditioning units in place), private showers and kitchens, including hot water heaters, plumbing and similar facilities installed by Subtenant and serving Subtenant exclusively (Subtenant will provide Sublandlord with written 

  

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copies of all maintenance contracts for such work); and (7) alterations or Subtenant Alterations approved by Sublandlord (and, if required, Landlord)
and performed by contractors retained by Subtenant, including related HVAC balancing, but will not include the obligation to maintain Building systems. All work shall be performed in accordance with the rules and procedures described in this
Sublease, the Master Lease, or as may otherwise be issued from time to time by Landlord or Sublandlord. If Subtenant fails to make any repairs to the Subleased Premises within applicable notice and cure periods (adjusted as described in
Section 9 below), Sublandlord shall have the rights and remedies set forth in Section 13.F of the Master Lease, as incorporated herein. 
 5.6 Compliance with Laws. Subtenant shall comply with all laws, including, without limitation, the Americans with Disabilities Act, regarding the operation of Subtenant’s business and the use, condition, configuration and
occupancy of the Subleased Premises and any Subtenant Alterations in the Subleased Premises; provided, however, that Subtenant shall have no obligation to comply with laws requiring alterations to the Building or alterations or upgrades to the
Building’s systems, except to the extent the same are necessitated by Subtenant’s particular use of the Subleased Premises or the performance of work by or on behalf of Subtenant; in such event, however, Sublandlord may elect to perform
such work at Subtenant’s cost. Sublandlord shall comply with all laws relating to the Common Areas and the base Building (except to the extent that such compliance is the responsibility of Landlord under the Master Lease), provided that
compliance with such laws is not necessitated by Subtenant Alterations or Subtenant’s particular use of the Subleased Premises and is not otherwise the responsibility of Subtenant as expressly provided in this Sublease. Notwithstanding the
foregoing, Sublandlord shall have the right to contest any alleged violation of applicable laws in good faith, including, without limitation, the right to apply for and obtain a waiver or deferment of compliance, the right to assert any and all
defenses allowed by law and the right to appeal any decisions, judgments or rulings to the fullest extent permitted by law. Sublandlord, after the exhaustion of any and all rights to appeal or contest, will make all repairs, additions, alterations
or improvements necessary to comply with the terms of any final order or judgment. Notwithstanding the foregoing, Subtenant, not Sublandlord, shall be responsible for the correction of any violations that arise out of or in connection with the
specific nature of Subtenant’s business in the Subleased Premises (other than general office use), Subtenant’s arrangement of any furniture, equipment or other property in the Subleased Premises, any repairs performed by Subtenant or any
Subtenant Alterations. Sublandlord shall be permitted to include in Operating Costs any costs or expenses incurred by Sublandlord under this Section 5.6 to the extent allowed pursuant to the terms of Section 3.2 above, and amortized to the
extent required by Section 3.2(a)(2)(b)(i) above. Subtenant, within ten (10) days after receipt, shall provide Sublandlord with copies of any written notices it receives regarding a violation or alleged violation of any laws.
Notwithstanding anything to the contrary herein, including Section 15.2(b), Sublandlord shall be solely responsible for code-related work related to the presence of Hazardous Materials on or about the Subleased Premises on or before the Early
Access Date or otherwise attributable to Sublandlord. 
 6. Services. 
 6.1 Generally. Sublandlord agrees to furnish Subtenant with the following services on all days, 24-hours per day (except as otherwise stated), all
of which shall be included in Operating Costs except as otherwise provided in this Sublease with respect to excess usage: 
 (a)
Water. Running City water from the regular Building outlets for drinking, lavatory and toilet purposes in the Building Common Areas on each floor on which the Subleased Premises are located. If Subtenant desires water in the Subleased
Premises for any approved reason, including for kitchen areas in the Subleased Premises, running City water shall be supplied, at Subtenant’s sole cost and expense, from the Building water main through a line and fixtures installed at
Subtenant’s sole cost and expense with the prior reasonable consent of Sublandlord. If Subtenant desires hot water in the Subleased Premises, Subtenant, at its sole cost and expense and subject to the prior reasonable consent of Sublandlord,
may install a hot water heater in the Subleased Premises; 
  

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 (b) HVAC. Heating, ventilation and air conditioning (“HVAC”) during Building Hours
(i.e., 8:00 a.m. to 6:00 p.m., Monday through Friday, holidays excepted), at such temperatures and in such amounts as is required for the comfortable occupancy and operation of the Subleased Premises as office space, as reasonably determined by
Sublandlord, provided that the occupancy level of the Subleased Premises does not exceed the occupancy density which the Building’s HVAC system was designed to serve (i.e., approximately five (5) persons per 1,000 rentable square feet).
Subtenant shall have the right to receive HVAC service during hours other than Building Hours using Sublandlord’s “after-hours” access card system. Subtenant shall have the right to receive HVAC service during hours other than
Building Hours using Sublandlord’s “after-hours” access card system. Subtenant shall pay Sublandlord the standard charge established from time to time by Sublandlord for the additional service, which charge Subtenant acknowledges for
after-hours HVAC service is currently $89.60 per floor (or partial floor) per hour as of the date of this Sublease, and which cost may be increased to the extent that Sublandlord’s actual cost (hereinafter defined) of providing such “after
hours” HVAC increases from time to time. The minimum time period for after hours HVAC usage shall be one (1) hour. For purpose of this Section 6.1(b), “actual cost” shall mean the actual cost incurred by Sublandlord, as
reasonably determined by Sublandlord, inclusive of a reasonable allocation for wear and tear, depreciation, provided that, notwithstanding the foregoing, any amount actually charged by any unrelated third party to Sublandlord for the supply of HVAC
shall be deemed Sublandlord’s “actual cost”. When determining the actual cost of Subtenant’s utility usage pursuant to the terms of this Section 6.1(b), Sublandlord agrees that it shall use the monthly average rate paid by
Sublandlord for a particular utility; 
 (c) Janitorial. Janitor service five (5) days per week (except on dates of the
observation of holidays); provided that if Subtenant’s use, floor covering or other improvements require special services in excess of the standard services for the Building, Subtenant shall pay the additional cost attributable to the special
services; 
 (d) Elevators and Access. Nonexclusive, non-attended automatic passenger elevator service during Building Hours, and at
least one elevator available at all other times to provide service to the Subleased Premises. Freight elevator access is available, but the vestibules for the freight elevator on each floor will require card key access. Key card access shall be
provided to the Building and passenger elevators and Subtenant shall have access to the Subleased Premises 24-hours per day, 7 days a week, subject to temporary closures due to emergency, casualty, Sublandlord’s security requirements and
maintenance, repair or changes to the Building or Project; 
  

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 (e) Electricity. Electricity to the Subleased Premises for general office use, in accordance with
and subject to the terms and conditions of Section 7 below; 
 (f) Security. On-site Project (as opposed to Building) security
equipment, personnel and procedures, if any, as Sublandlord may elect in its sole discretion to establish from time to time; 
 (g) Fire
Alarm. Fire detectors and alarm serving the Building in general; and 
 (h) Other. Such other services as Sublandlord reasonably
determines are necessary or appropriate for the Building or Project. 
 6.2 Interruption of Service. Sublandlord’s failure to
furnish, or any interruption or termination of, services due to the application of laws, the failure of any equipment, the performance of repairs, improvements or alterations, or the occurrence of any event or cause beyond the reasonable control of
Sublandlord, shall not render Sublandlord liable to Subtenant, constitute a constructive eviction of Subtenant, give rise to an abatement of rent (except as expressly set forth herein), nor relieve Subtenant from the obligation to fulfill any
covenant or agreement , provided that if any interruption in services to the Subleased Premises (i) continues for five (5) consecutive business days or more, (ii) is due to the act or omission of Sublandlord or Sublandlord’s
employees or agents, (iii) is not attributable to the acts or omissions of Subtenant or Subtenant’s employees, invitees or agents and (iv) prevents Subtenant from occupying any material portion of the Subleased Premises, Base Rent
shall abate from and after the fifth (5th) consecutive business day of the interruption to the extent the Subleased Premises are rendered unusable and are actually not used by Subtenant as a result thereof. In no event, however, shall
Sublandlord be liable to Subtenant for any loss or damage, direct or indirect, special or consequential, including loss of business or theft of Subtenant’s property, arising out of or in connection with the failure of any security services,
personnel or equipment. 
 7. Use of Electrical Services by Subtenant. 
 7.1 Normal Electrical Usage. The Building has been designed to accommodate electrical receptacle (120/208v) loads of three and one half
(3.5) watts per usable square foot and an average lighting load of two (2) watts per usable square foot during Building Hours, with such average determined on a monthly basis (the “Standard Electrical Usage”), which electrical
usage shall be subject to applicable laws, including Title 24. Subtenant will design Subtenant’s electrical system serving any equipment producing nonlinear electrical loads to accommodate such nonlinear electrical loads, including, but not
limited to, oversizing neutral conductors, derating transformers and/or providing power-line filters. Engineering plans shall include a calculation of Subtenant’s fully connected electrical design load with and without demand factors and shall
indicate the number of watts of unmetered and submetered loads. Electrical service to the Subleased Premises may be furnished by one or more companies 

  

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providing electrical generation, transmission and distribution services, and the cost of electricity may consist of several different components or separate
charges for such services, such as generation, distribution and stranded cost charges. Sublandlord shall have the exclusive right to select any company providing electrical service to the Subleased Premises, to aggregate the electrical service for
the Project, Building or Subleased Premises with other buildings, to purchase electricity through a broker and/or buyers group and to change the providers and manner of purchasing electricity. Subtenant shall bear the cost of replacement of lamps,
starters and ballasts for non-Building standard lighting fixtures within the Subleased Premises. Sublandlord, as part of Operating Costs, shall bear the cost of lamps, starters and ballasts for Building standard lighting fixtures within the
Subleased Premises. 
 7.2 Excess Usage. Subtenant’s use of electrical service shall not exceed, either in voltage, rated
capacity or overall load, the Standard Electrical Usage. If Subtenant requests permission to consume excess electrical service, Sublandlord may refuse to consent or may condition consent upon conditions that Sublandlord reasonably elects (including,
without limitation, the installation of utility service upgrades, meters, submeters, air handlers or cooling units), and the additional usage (to the extent permitted by law), installation and maintenance costs shall be paid by Subtenant.
Sublandlord shall have the right to separately meter or submeter electrical usage for the Subleased Premises and to measure electrical usage by survey or other commonly accepted methods; if Subtenant is consuming in excess of Standard Electrical
Usage, such meter or submeter will be installed at Subtenant’s cost. 
 8. Master Lease and Sublease Terms. 
 8.1 Subject to Master Lease. This Sublease is and shall be at all times subject and subordinate to the Master Lease. Subtenant acknowledges that
Subtenant has reviewed and is familiar with all of the terms, agreements, covenants and conditions of the Master Lease. Additionally, Subtenant’s rights under this Sublease shall be subject to the terms of the Consent. During the Term and for
all periods subsequent thereto with respect to obligations which have arisen prior to the termination of this Sublease, Subtenant agrees to perform and comply with, for the benefit of Sublandlord and Landlord, the obligations of Sublandlord under
the Master Lease, to the extent incorporated herein and which pertain to the Subleased Premises and/or this Sublease, except for those provisions of the Master Lease which are directly contradicted by this Sublease, in which event the terms of this
Sublease document shall control over the Master Lease. 
 8.2 Incorporation of Terms of Master Lease. Subject to the provisions of
this Article 8, the terms, conditions and respective obligations of Sublandlord and Subtenant to each other under this Sublease shall be the terms and conditions of the Master Lease and such terms are incorporated into this Sublease as if fully set
forth herein, except for those provisions of the Master Lease which are directly contradicted by this Sublease, in which event the terms of this Sublease shall control over the Master Lease. Therefore, for the purposes of this Sublease, wherever in
the Master Lease the word “Landlord” is used it shall be deemed to mean Sublandlord and wherever in the Master Lease the word “Tenant” is used it shall be deemed to mean Subtenant and wherever in the Master Lease the words
“Lease” or “Premises” are used such terms shall be deemed to mean this Sublease and the Subleased Premises. Any non-liability, release, indemnity or hold harmless provision in the Master Lease for the benefit of 

  

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Landlord that is incorporated herein by reference, shall be deemed to inure to the benefit of Sublandlord, Landlord, and any other person intended to be
benefited by said provision, for the purpose of incorporation by reference in this Sublease. Any right of Landlord under the Master Lease (a) of access or inspection, (b) to do work in the Master Lease Premises or in the Building, or
(c) in respect of rules and regulations, which is incorporated herein by reference, shall be deemed to inure to the benefit of Sublandlord, Landlord, and any other person intended to be benefited by said provision, for the purpose of
incorporation by reference in this Sublease. 
 8.3 Clarifications. For the purposes of incorporation herein, the terms of the Master
Lease are subject to the following additional modifications: 
 (a) Approvals. In all provisions of the Master Lease (under the terms
thereof and without regard to modifications thereof for purposes of incorporation into this Sublease) requiring the approval or consent of Landlord, Subtenant shall be required to obtain the approval or consent of both Sublandlord and Landlord.

 (b) Deliveries. In all provisions of the Master Lease requiring Tenant to submit, exhibit to, supply or provide Landlord with
evidence, certificates, or any other matter or thing, Subtenant shall be required to submit, exhibit to, supply or provide, as the case may be, the same to both Landlord and Sublandlord. 
 (c) Damage; Condemnation. Sublandlord shall have no obligation to restore or rebuild any portion of the Subleased Premises after any destruction
or taking by eminent domain; provided that if and to the extent the Subleased Premises contain improvements which constitute “Alterations” or “Tenant Improvements”, as said terms are described in the Master Lease, and neither
Sublandlord nor Landlord exercise their right to terminate the Master Lease as a result of such casualty or taking, then Sublandlord will repair and restore such “Alterations” or “Tenant Improvements” to the condition existing
prior to such casualty or taking. In addition, Sublandlord shall insure the Subtenant Alterations and Furniture (the cost of which insurance will be included in Sublandlord Operating Costs), and, in the event of any casualty and condemnation
(provided neither Sublandlord nor Landlord exercise their right to terminate the Master Lease as a result thereof), Sublandlord shall repair and restore the Subtenant Alterations and Furniture. Subtenant shall reimburse Sublandlord for any increased
cost of Sublandlord’s property insurance due to the coverage of the Subtenant Alterations and Furniture required hereunder. 
 (d)
Insurance. In all provisions of the Master Lease requiring Tenant to designate Landlord as an additional or named insured on its insurance policy, Subtenant shall be required to so designate Landlord and Sublandlord on its insurance policy.

 8.4 Exclusions. Notwithstanding the terms of Section 8.2 above, the following parts, Sections and Exhibits of the Master
Lease shall not be incorporated herein: 
 (a) Original Master Lease: Article 1, Section 2.A.iv (second paragraph),
Section 2.A.vi. Section 2.C, Section 3.A (first, third and fourth sentences only), Section 3.C, Sections 4.A, 4.B. and 4.D, Article 5, Sections 6.A, 6.B (clauses vii, and viii and final sentence only), Sections 6.C, 7.A (third
sentence only, and provided that the reference to 

  

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“Landlord” in the seventh sentence will be deemed a reference to Landlord only, not Sublandlord), 7.C (last two sentences only), 8.A, 8.B, 8.C,
8.D, 8.E, 8.G, 9.B, 9.C (references to “Tenant Improvements” and “Alterations” in the first sentence thereof only), Article 10 (except clause (i) of the first sentence, Subtenant acknowledging that the remainder of the items
described in said Article 10 will constitute and be included in Operating Costs), Article 11, Article 13 (clauses (viii) and (ix) of the first sentence only), Sections 14.A (second (2nd), third (3rd) and fourth (4th) sentences
only), 14.B (final sentence only), 17.A (references to termination rights only), 17.B (clause (ii) and references to “Monthly Amortized Costs” only), 17.G, Article 18, Article 19, Article 20, Sections 21.C, 21.K, 21.M, 21.T, 21.W.

 (b) First Amendment: All. 
 (c) Second Amendment: All. 
 (d) Third Amendment: All 
 8.5 Modifications. Notwithstanding the terms of Section 8.2 above, the following provisions of the Master Lease are modified as described
below for the purpose of their incorporation into this Sublease: 
 (a) With respect to Article 15 of the Original Master Lease, if Landlord
elects to terminate the Master Lease pursuant to Section 15.B of the Original Master Lease or if Sublandlord elects to terminate the Master Lease pursuant to Section 15.C of the Original Master Lease, Sublandlord will promptly notify
Subtenant and this Sublease will terminate concurrently with the termination of the Master Lease. If neither Landlord nor Sublandlord elects to terminate the Master Lease, Sublandlord will nonetheless provide Subtenant with a copy of Landlord’s
notice of the time necessary to complete repairs as provided in Section 15.C of the Original Master Lease, as well as an estimate of the additional time necessary for Sublandlord to complete any repairs required of Sublandlord pursuant to the
provisions of Article 15 of the Original Master Lease, and (x) Subtenant will have the same right to terminate the Sublease as Sublandlord has to terminate the Master Lease as described in the second (2nd) and fourth (4th) sentences
of Section 15.C of the Original Master Lease as incorporated herein; provided that for such purposes references in the second (2nd) and fourth (4th) sentences of Section 15.C to “Landlord” or “Landlord’s”
will be deemed to be references to “Sublandlord” or “Sublandlord’s” and “Landlord” or “Landlord’s”. 
 (b) With respect to Section 17.A of the Original Master Lease, the second (2nd) clause (i) is modified to provide that, except in the case of a Permitted Transfer (as said term is defined in
Section 17.E of the Original Master Lease, as said Section has been revised for the purposes of incorporation herein by Section 8.5(d) below), Sublandlord may terminate this Sublease with respect to an assignment of this Sublease or a
proposed sublease of any portion of the Subleased Premises for substantially the remainder of the Term (but in the case of a proposed sublease of a portion of the Subleased Premises, such termination will only be with respect to the portion of the
Subleased Premises which Subtenant proposes to sublease, and effective as of the date of such termination, the Base Rent payable hereunder, as well as Subtenant’s Building Percentage Share and Subtenant’s Project Percentage Share, will be
adjusted to reflect the reduction in the size of the Subleased Premises). 
  

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 (c) With respect to Section 17.E of the Original Master Lease, in clauses (ii) and (iii), in
each case the phrase “has a net worth at the time of and thereafter sufficient to enable it to meet its obligations under this Lease” is deleted and restated, for the purposes of incorporation herein, as follows: “has a net worth
which, in Sublandlord’s reasonable determination, is equal to or in excess of the net worth of Subtenant as of the date immediately preceding the proposed assignment and is sufficient to enable it to meet its obligations under this Lease.”

 (d) Except as set forth in Section 8.5(a) above, references in the following provisions of the Master Lease to “Landlord”
shall mean “Landlord”: Articles 15 and 16. 
 (e) All of Subtenant’s and Sublandlord’s maintenance and repair
obligations under this Sublease shall be subject to the provisions of Section 9.D of the Master Lease, as incorporated herein, which provisions shall apply as between Sublandlord and Subtenant notwithstanding anything to the contrary in this
Sublease and without regard to the negligence or willful misconduct of the person or entity released thereunder. 
 (f) The reference in
Section 15.C of the Original Master Lease to “three hundred sixty five (365)” shall be deemed to be “two hundred seventy (270)”. 
 (g) Whenever there is an obligation to pay the costs and expenses of “Landlord”, Subtenant shall only be obligated to pay Sublandlord’s costs and expenses to the extent they exceed or are separate from
Landlord’s costs and expenses; provided that Sublandlord shall not be entitled to independently charge Subtenant any review costs or construction supervision fees in connection with Subtenant’s Initial Alterations. 
 (h) With respect to Section 21(g) of the Original Master Lease, Sublandlord will be permitted to enter the Subleased Premises in order to perform
any maintenance and repair tasks applicable to the Subleased Premises or the Building or to facilitate the construction of improvements within the Building (for example, access may be necessary in order to install connections between rooftop
facilities and the premises of Building occupants on other floors who are served by such facilities) which work will not require Subtenant’s prior consent, to access the Telecom Riser Room and other similar facilities located on the floor(s) on
which the Subleased Premises are located; Sublandlord agrees to use reasonable efforts to minimize disturbance to Subtenant’s business operations in the Subleased Premises as a result of any such entry and to provide reasonable (i.e., at least
twenty-four (24) hours) advance notice (which may be telephonic) to Subtenant of any such entry, except in the case of emergency and shall indemnify, defend, protect and hold harmless Subtenant against all losses, costs, claims, liabilities and
damages, subject to Section 13, Subtenant incurs as a result of such entry. 
 9. Assignment and Subletting. 
 9.1 Generally. Subtenant shall not assign this Sublease or further sublet all or any part of the Subleased Premises except subject to and in
compliance with all of the terms and conditions of Article 17 of the Original Master Lease, and Sublandlord (in addition to Landlord) shall have the same rights with respect to assignment and subleasing as Landlord has under such Article 17, as
incorporated herein, provided, however, that: 
 (x) fifty percent (50%) of all excess rent (calculated as provided in Section 17.B
of the Original Master Lease, as incorporated herein) in connection with any such assignment or sublease shall be payable to Sublandlord as and when received by Subtenant; and 
  

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 (y) Subtenant shall be entitled to retain all remaining excess rent. 
 Subtenant shall pay all fees and costs payable to Landlord pursuant to the Master Lease in connection with any proposed assignment, sublease or transfer
of the Subleased Premises, together with all of Sublandlord’s reasonable out-of-pocket costs relating to Subtenant’s request for such consent (not to exceed $2,500.00), regardless of whether such consent is granted, and the effectiveness
of any such consent shall be conditioned upon Landlord’s and Sublandlord’s receipt of all such fees and costs. The sale of shares of Subtenant’s stock on a nationally recognized securities exchange in the normal course of trading (as
opposed to the transfer of shares in connection with a merger or acquisition) will not constitute an assignment of Subtenant’s interest in this Sublease. 
 10. Default. Except as expressly set forth herein, Subtenant shall perform all obligations in respect of the Subleased Premises that Sublandlord would be required to perform pursuant to the Master Lease, to the
extent incorporated herein. It shall constitute an event of default hereunder if Subtenant fails to perform any obligation hereunder (including, without limitation, the obligation to pay Rent), or any obligation under the Master Lease which has been
incorporated herein by reference, and, in each instance, Subtenant has not remedied such failure after delivery of any written notice required under this Sublease and passage of the cure periods prescribed in Section 13 of the Master Lease as
incorporated herein, provided that with respect to non-monetary defaults, Subtenant’s cure period shall be the longer of (A) one-half of, or (B) five (5) calendar days less than, the actual cure period provided for such
non-monetary default under the Master Lease, as incorporated herein. 
 11. Remedies. In the event of any default hereunder by
Subtenant, Sublandlord shall have all remedies provided to the “Landlord” in the Master Lease, as incorporated herein and all other rights and remedies otherwise available at law and in equity. Without limiting the generality of the
foregoing, Sublandlord may continue this Sublease in effect after Subtenant’s breach and abandonment and recover Rent as it becomes due. Sublandlord may resort to its remedies cumulatively or in the alternative. 
 12. Right to Cure Defaults. If Subtenant fails to perform any of its obligations under this Sublease after expiration of applicable grace or cure
periods, then Sublandlord shall have the rights and remedies specified in Section 13.F of the Master Lease, as incorporated herein. If Sublandlord undertakes to perform any of Subtenant’s obligations for the account of Subtenant pursuant
hereto, the taking of such action shall not constitute a waiver of any of Sublandlord’s remedies. Subtenant hereby expressly waives its rights under any statute to make repairs at the expense of Sublandlord. 
  

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 13. Sublandlord’s Liability. Notwithstanding any other term or provision of this Sublease,
the liability of Sublandlord to Subtenant for any default in Sublandlord’s obligations under this Sublease shall be limited to actual, direct damages, and under no circumstances shall Subtenant, its partners, members, shareholders, directors,
agents, officers, employees, contractors, sublessees, successors and/or assigns be entitled to recover from Sublandlord (or otherwise be indemnified by Sublandlord) for (a) any losses, costs, claims, causes of action, damages or other liability
incurred in connection with a failure of Landlord, its partners, members, shareholders, directors, agents, officers, employees, contractors, successors and /or assigns to perform or cause to be performed Landlord’s obligations under the Master
Lease, except as otherwise provided herein, (b) lost revenues, lost profit or other consequential, special or punitive damages arising in connection with this Sublease for any reason, or (c) any damages or other liability arising from or
incurred in connection with the suitability of the Subleased Premises for Subtenant’s intended uses. Subtenant shall, however, have the right to seek any injunctive or other equitable remedies as may be available to Subtenant under applicable
law. Notwithstanding any other term or provision of this Sublease, no personal liability shall at any time be asserted or enforceable against Sublandlord’s stockholders, directors, officers, or partners on account of any of Sublandlord’s
obligations or actions under this Sublease. As used in this Sublease, the term “Sublandlord” means the holder of the tenant’s interest under the Master Lease and the holder of Sublandlord’s interest under this Sublease. In the
event of any assignment or transfer of the Sublandlord’s interest under this Sublease, which assignment or transfer may occur at any time during the Term in Sublandlord’s sole discretion, Sublandlord shall be and hereby is entirely
relieved of all covenants and obligations of Sublandlord hereunder accruing subsequent to the date of the transfer and it shall be deemed and construed, without further agreement between the parties hereto, that any transferee has assumed and shall
carry out all covenants and obligations thereafter to be performed by Sublandlord hereunder. Sublandlord may transfer and deliver any then existing Security Deposit to the transferee of Sublandlord’s interest under this Sublease, and thereupon
Sublandlord shall be discharged from any further liability with respect thereto provided that such transferee has assumed in writing all of Sublandlord’s obligations under this Sublease. 
 14. Attorneys’ Fees. If Sublandlord or Subtenant brings an action to enforce the terms hereof or to declare rights hereunder, then
Section 21.A of the Master Lease, as incorporated herein, shall govern the payment of attorneys’ fees in connection therewith. 
 15. Delivery of Possession. 
 15.1 Generally. Except as expressly set forth herein, Sublandlord shall deliver, and
Subtenant shall accept, possession of the Subleased Premises in good “broom-clean” condition, with all Building systems in good operating condition, and otherwise in their “AS IS” condition as the Subleased Premises exists on the
date of this Sublease. Sublandlord shall have no obligation to furnish, render or supply any work, labor, services, materials, furniture other than the Furniture (defined below), fixtures, equipment, decorations or other items to make the Subleased
Premises ready or suitable for Subtenant’s occupancy. In making and executing this Sublease, Subtenant has relied solely on such investigations, examinations and inspections as Subtenant has chosen to make or has made and has not relied on any
representation or warranty concerning the Subleased Premises or the Building, except as expressly set forth in this Sublease. Subtenant acknowledges that Sublandlord has afforded Subtenant the opportunity for full and 

  

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complete investigations, examinations and inspections of the Subleased Premises and the Building Common Areas. Subtenant acknowledges that it is not
authorized to make or perform any alterations or improvements in or to the Subleased Premises except as permitted by the provisions of this Sublease and the Master Lease and that upon termination of this Sublease, Subtenant shall deliver the
Subleased Premises to Sublandlord in the same condition as the Subleased Premises were at the commencement of the Term, reasonable wear and tear, casualty, condemnation, Hazardous Materials (other than those released by Subtenant or its agents,
invitees, employees and contractors) and those Subtenant Alterations the removal of which is not required by the terms hereof excepted; in any event, at Subtenant’s cost, Subtenant will remove all telecommunications and data cabling (including
Network Cabling) installed by or for the benefit of Subtenant. 
 15.2 Subtenant’s Alterations. 
 (a) Generally. The parties acknowledge that Subtenant intends to construct improvements within the Subleased Premises; said improvements which are
initially constructed in anticipation of Subtenant’s occupancy of the Subleased Premises (the “Initial Subtenant Alterations”) or are constructed by or on behalf of Subtenant following Subtenant’s occupancy of the Subleased
Premises being referred to as “Subtenant Alterations”. All Subtenant Alterations shall be carried out in accordance with, and will be deemed “alterations” for the purpose of the Master Lease and will be subject to Landlord’s
prior written approval to the extent required under the Master Lease. Sublandlord will have the right to reasonably approve the Plans (defined below) for any proposed Subtenant Alterations, as well as any contractors whom Subtenant proposes to
retain to perform such work (provided that Sublandlord may designate the contractors who will perform work on the Building’s electrical, HVAC or life-safety systems). Sublandlord’s consent shall not be unreasonably withheld with respect to
proposed Subtenant Alterations that (a) comply with all applicable laws; (b) are compatible with the Building, its architecture and its mechanical, electrical, HVAC and life safety systems; (c) do not interfere with the use and
occupancy of any other portion of the Building by any other occupant or their invitees; (d) do not affect the structural portions of the Building; (e) do not and shall not, whether alone or taken together with other improvements, require
the construction of any other improvements or alterations within the Building; and (f) do not affect the exterior appearance of the Building. Additionally, Sublandlord may require that Subtenant incorporate “Project-Standard”
materials with respect to (i) ceiling tile, (ii) lighting, (iii) doors, frames and hardware and (iv) other similar finish components. In determining whether to consent to proposed Subtenant Alterations, Sublandlord shall have the
right to review and approve Plans for proposed Subtenant Alterations, construction means and methods, the identity of any contractor or subcontractor to be employed on the work for Subtenant Alterations, and the time for performance of such work. In
connection with any proposed Subtenant Alterations, Subtenant will be responsible for providing any reasonable security required by Landlord pursuant to Section 7.A of the Original Master Lease. Additionally, if Sublandlord in good faith
determines that Subtenant proposes to construct Subtenant Alterations which would be materially more expensive to remove than the typical office improvements located in the Building, Sublandlord, in Sublandlord’s discretion, may require as a
condition to granting its consent to any proposed Subtenant Alterations that Subtenant increase the Security Deposit by an amount reasonably determined by Sublandlord to be sufficient to secure the performance of Subtenant’s obligation to
restore or remove such Subtenant Alterations at the expiration or sooner termination of the 

  

 25 

 
Sublease (whether such restoration is required by Landlord or Sublandlord). Subtenant shall supply to Sublandlord any documents and information reasonably
requested by Sublandlord in connection with any Subtenant Alterations. Sublandlord may hire outside consultants to review such documents and information and Subtenant shall reimburse Sublandlord for the cost thereof as well as Sublandlord’s
internal costs; provided that Sublandlord will not have the right to charge Subtenant for any such costs in connection with the Initial Subtenant Alterations. All Subtenant Alterations permitted hereunder shall be made and performed by Subtenant
without cost or expense to Sublandlord, except with respect to Sublandlord’s funding of the Allowance, described below. Upon completion of any Subtenant Alterations, Subtenant shall provide Sublandlord, at Subtenant’s expense, with a
complete set of “as built” plans on Mylar and specifications reflecting the actual conditions of the Subtenant Alterations as constructed in the Subleased Premises, together with a copy of such plans on diskette in AutoCAD format or such
other format as may then be in common use for computer assisted design purposes; additionally, Subtenant will provide Sublandlord with the items required under clauses (i) through (iii) of Section 7.A of the Original Master Lease for
delivery to Landlord. Sublandlord shall have the right to promulgate commercially reasonable rules and regulations regarding the performance of Subtenant Alterations; Subtenant’s initial guidelines for construction are attached hereto as
Exhibit F. Sublandlord will not charge any construction management fee, nor will Subtenant be charged for utilities consumption for the period from and after the Early Access Date to the Commencement Date, with respect to the performance of
the Initial Subtenant Alterations (as opposed to any subsequent Subtenant Alterations); however, if and to the extent that Landlord imposes a construction management fee with respect to any Subtenant Alterations, or otherwise passes through review
fees and costs, Subtenant will be responsible for paying such sums. As used herein, “Plans” will mean fully dimensioned architectural construction drawings and specifications, and any required engineering drawings (including mechanical,
electrical, plumbing, air-conditioning, ventilation and heating), and shall include, to the extent applicable: (i) electrical outlet locations, circuits and anticipated usage therefor, (ii) reflected ceiling plan, including lighting,
switching, and any special ceiling specifications, (iii) duct locations for heating, ventilating and air-conditioning equipment, (iv) details of all millwork, (v) dimensions of all equipment and cabinets to be built in,
(vi) furniture plan showing details of space occupancy, (vii) keying schedule, (viii) lighting arrangement, (ix) location of print machines, equipment in lunch rooms, concentrated file and library loadings and any other equipment
or systems (with brand names wherever possible) which require special consideration relative to air-conditioning, ventilation, electrical, plumbing, structural, fire-life safety or mechanical systems, (x) special heating, ventilating and air
conditioning equipment and requirements, (xi) weight and location of heavy equipment, and anticipated loads for special usage rooms, (xii) demolition plan, (xiii) partition construction plan, (xiv) all requirements under the
Americans with Disabilities Act and other governmental requirements, and (xv) final finish selections, and any other details or features reasonably required by Landlord. Subject to Sublandlord’s review of more detailed plans, Sublandlord
hereby consents to Subtenant’s construction of the Initial Subtenant Alterations shown on Exhibit G and agrees that Subtenant shall not be required to provide any increase in the Security Deposit with respect thereto. 
 (b) Code-Required Work. If the performance of any Subtenant Alterations or other work by Subtenant within the Subleased Premises
“triggers” a requirement for code-related upgrades to or improvements of any portion of the Building or Project, Subtenant shall be responsible for the cost of such code-required upgrade or improvements. 
  

 26 

 (c) Allowance. Sublandlord hereby grants to Subtenant an allowance of Four and No/100 Dollars
($4.00) per rentable square foot of the Subleased Premises (which, based upon 26,386 rentable square feet, equates to $105,544.00 (the “Allowance”). 
 (1) The Allowance is to be used for: 
 (A) Payment of the cost of preparing space plans and construction
drawings, including mechanical, electrical, plumbing and structural drawings. 
 (B) The payment of plan check, permit and license fees
relating to construction of the Initial Subtenant Alterations. 
 (C) Construction of the Initial Subtenant Alterations. 
 (2) Disbursement. The Allowance shall be paid to Subtenant in its entirety, within thirty (30) days following request by Subtenant, which
request must be accompanied by (i) evidence that the items described in Section 15.2(c)(1)(C) above have been completed and (ii) full and final waivers of lien from all contractors performing any portion of the Initial Subtenant
Alterations. 
 (d) End of Term. Subtenant expressly acknowledges that Landlord or Sublandlord may require Subtenant to remove some
or all Subtenant Alterations at the expiration or sooner termination of the Term; however, if Landlord requires the removal/restoration of any reception areas constructed by Subtenant (not to exceed 1,000 rentable square feet in size), Sublandlord
agrees to be responsible for the restoration of such reception area, and Sublandlord will not have the independent right to require removal of such reception area. Subtenant will also be responsible for the performance of the items of work required
by clauses (i), (ii), (iii), (iv) and (v) (to the extent Tenant installs cabling) of Section 6.B of the Original Master Lease, to the extent applicable to the Subleased Premises. Subtenant acknowledges that Landlord may notify
Sublandlord following the scheduled expiration of this Sublease of Landlord’s determination that certain alterations performed by Subtenant must be removed. The parties acknowledge that Subtenant’s obligation to remove any Subtenant
Alterations which Landlord requires the removal of (and the removal of which is not the express responsibility of Sublandlord pursuant to this Section 15.2(d)) will survive the expiration or sooner termination of this Sublease. 
 16. Holding Over. If Subtenant holds over after the expiration or earlier termination of this Sublease with the express or implied consent of
Sublandlord, such tenancy shall be from month-to-month only and shall not constitute a renewal hereof or an extension for any further term. Such month-to-month tenancy shall be subject to all the terms and provisions of this Sublease, except that
Subtenant shall pay Base Rent and Additional Rent in an amount (on a per month basis without reduction for partial months during the holdover) equal to 150% of the greater of: (1) the sum of the Base Rent and Additional Rent due for the period
immediately preceding the holdover; or (2) the fair market gross rental for the Subleased Premises as reasonably determined by Sublandlord. Nothing contained in this Section 16 shall be construed as consent by Sublandlord to any holding
over by Subtenant, and Sublandlord expressly reserves 

  

 27 

 
the right to recover immediate possession of the Subleased Premises by summary proceedings or otherwise. In addition to the payment of the amounts provided
above, if Sublandlord is unable to deliver possession of the Subleased Premises to a new subtenant or to Landlord, as the case may be, or to perform improvements for a new subtenant, as a result of Subtenant’s holdover, Subtenant shall be
liable to Sublandlord for all damages, including, without limitation, consequential damages, that Sublandlord suffers solely due to the holdover; Subtenant expressly acknowledges that such damages may include all of the holdover rent charged by
Landlord under the Master Lease as a result of Subtenant’s holdover, which Master Lease holdover rent may apply to the entire Master Lease Premises. Notwithstanding any other term or provision of this Sublease, if the Term expires on the
Expiration Date (as opposed to an early termination for any reason), Subtenant shall be entitled to hold over, without any payment of Base Rent and Additional Rent, solely for the purpose of performing any repair/restoration obligations of Subtenant
under this Sublease, so long as (x) Subtenant’s work of repair/restoration does not interfere with Sublandlord’s restoration work, if any, which is concurrently being performed in the Building and (y) in no event will Subtenant
have any right to remain in the Subleased Premises for any reason whatsoever following the date which precedes the date of expiration of the term of the Master Lease. 
 17. Parking. During the Term Subtenant shall be permitted to use one hundred (100) (i.e., 3.78 spaces per 1,000 rentable square feet in the Subleased Premises) of the parking spaces allocated to
Sublandlord in the Master Lease at no additional charge. Such parking shall be provided on an unreserved basis. One (1) reserved parking space located in the underground parking lot directly beneath the Subleased Premises for each full floor
occupied by Subtenant shall be allocated to Subtenant from the amount described above. Sublandlord reserves the right in the future to designate reserved parking spaces at Sublandlord’s sole discretion. Except for reserved spaces allocated at a
ratio of one space per floor in the Project, such parking is, however, currently all unreserved and distributed below the Project, on surface lots and in a separate structure. 
 18. Notices: Any notice by either party to the other required, permitted or provided for herein shall be valid only if in writing and shall be
deemed to be duly given only if (a) delivered personally, or (b) sent by means of Federal Express, UPS Next Day Air or another reputable express mail delivery service guaranteeing next business day delivery, or (c) sent by United
States certified or registered mail, return receipt requested, addressed: (i) if to Sublandlord, at the following addresses: 
 Oracle USA, Inc. 
 c/o Oracle Corporation 
 1001 Sunset Boulevard 
 Rocklin, California 95765 
 Attn: Lease Administration 
  

 28 

 with a copy to: 
 Oracle USA, Inc. 
 c/o Oracle Corporation 
 500 Oracle Parkway 
 Box 5OP7 
 Redwood Shores, California 94065 
 Attn: Legal Department 
 and (ii) if to
Subtenant, at the following address: 
 Before the Commencement Date: 
 NeurogesX, Inc. 
 San Carlos Business Park 
 981F Industrial Road 
 San Carlos, California 94070-4117 
 Attn: Chief Financial Officer 
 After the Commencement Date: 
 NeurogesX, Inc. 
 The Subleased Premises 
 Attn: Chief Financial Officer 
 and to: 
 Wilson Sonsini Goodrich &
Rosati 
 650 Page Mill Road 
 Palo Alto, California 94304 
 Attn: Real Estate Department/SPR 
 or at such other address for either party as that party may designate by notice to the other. A notice shall be deemed given and effective, if delivered personally, upon
hand delivery thereof (unless such delivery takes place after hours or on a holiday or weekend, in which event the notice shall be deemed given on the next succeeding business day), if sent via overnight courier, on the business day next succeeding
delivery to the courier, and if mailed by United States certified or registered mail, three (3) business days following such mailing in accordance with this Section. 
 19. Furniture. During the Term, at no charge to Subtenant, Subtenant shall be permitted to use the existing modular and office furniture and cabling located in the Subleased Premises and described in more
particular detail in Exhibit C attached hereto (the “Furniture”). Such Furniture shall be delivered in good “as-is” condition. Subtenant shall accept the Furniture in its current condition without any warranty of fitness
from Sublandlord (Subtenant expressly acknowledges that no warranty is made by Sublandlord with respect to the condition of any cabling currently located in or serving the Subleased Premises); for purposes of documenting the 

  

 29 

 
current condition of the Furniture, Subtenant and Sublandlord shall, prior to the Commencement Date, conduct a joint walk-through of the Subleased Premises
in order to inventory items of damage or disrepair in the Furniture. Subtenant shall use the Furniture only for the purposes for which such Furniture is intended and shall be responsible for the proper maintenance, care and repair of the Furniture,
at Subtenant’s sole cost and expense. No item of Furniture shall be removed from the Subleased Premises without Sublandlord’s prior written consent. On or about the date of expiration of the Term, the parties shall once again conduct a
walk-through of the Subleased Premises to catalog any items of damage, disrepair, misuse or loss among the Furniture (reasonable wear and tear, casualty and condemnation excepted), and Subtenant shall be responsible, at Subtenant’s sole cost
and expense, for curing any such items (including, with respect to loss, replacing any lost item with a substantially similar item reasonably acceptable to Sublandlord). Subtenant shall not modify, reconfigure or relocate any furniture except with
the advance written permission of Sublandlord, and any work of modifying any Furniture (including, without limitation, changing the configuration of, “breaking down” or reassembly of cubicles or other modular furniture) and any maintenance
of the same shall be performed at Subtenant’s sole cost using Sublandlord’s specified vendors or an alternate vendor approved in writing by Sublandlord (such approval to be granted or withheld in Sublandlord’s good faith discretion,
based upon Sublandlord’s assessment of factors which include, without limitation, whether the performance by such vendor will void applicable warranties for such furniture and whether such vendor is sufficiently experienced in the design of
such furniture). Notwithstanding the foregoing, Sublandlord will remove any Furniture from the Subleased Premises requested by Subtenant prior to the Commencement Date or, at Subtenant’s request, prior to a mutually agreed upon date, provided
that Subtenant delivers to Sublandlord notice specifying the items to be removed at least ten (10) business days prior to the Commencement Date or mutually agreed upon date; provided that in no event will Sublandlord be required to expend in
excess of $10,000.00 to perform such removal work. Following such removal, any such items so removed will no longer be deemed to be included with the definition of “Furniture” and, at Landlord’s option, the parties will jointly
execute a revised Exhibit C reflecting the revised Furniture Inventory. 
 20. Access System. Subtenant acknowledges that
Sublandlord currently has an access system monitoring access to the Project and the Building. Subtenant acknowledges that there are card readers installed throughout the Building and Project which are part of Sublandlord’s access system.
Subtenant will not interfere with, adjust or damage any such card readers. To the fullest extent permitted under applicable law, Subtenant hereby acknowledges that, except for making the card key reader system available for Subtenant’s use with
card keys initially at no cost to Subtenant (Sublandlord will have a right to charge a reasonable fee for lost or replacement card keys) and except for servicing and maintaining the system, Sublandlord shall not be responsible for providing access
or security services to Subtenant, and that Subtenant shall be solely responsible for providing its own security service, if any. Subject to its review of plans therefore, Sublandlord consents to Subtenant’s installation of its own security and
card reader system at the Subleased Premises; provided that at Sublandlord’s or Landlord’s option, Subtenant will remove such systems at the end of the Term. Sublandlord shall also, at its sole cost, promptly upon request by Subtenant, add
the access keys of certain of Subtenant’s employees to the database of Sublandlord’s security system to allow Subtenant to access the freight elevator vestibule on the second (2nd) floor. Sublandlord will provide Subtenant with one
(1) card key for each workstation located in the Subleased Premises at no charge, and in the event Subtenant so requests, Sublandlord shall provide Subtenant with replacement card keys at a price of $10.00 per card. 
  

 30 

 21. Signage. 
 21.1 Monument Sign. Subject to the prior written consent of Landlord (if required under the Master Lease) and the procurement of any approvals or permits required by City, Subtenant will be entitled to a
pro-rata allocation of space on any monument signage serving the Building (a “Monument Sign”) for the purpose of displaying Subtenant’s name only, in Project-standard lettering. Subtenant acknowledges that no such Monument Sign exists
as of the date of this Sublease; however, Sublandlord shall install Monument Sign serving the Building within sixty (60) days of the date hereof. Further, the location of Subtenant’s trade name on the Monument Sign shall be subject to
availability at the time Subtenant elects to install same on any such monument and Subtenant shall also be entitled to signage identifying its name in the lobby directory of the Building (if any) and to signage identifying its name and/or logo at
the entrance to the Subleased Premises. Sublandlord shall not be required to reserve any particular location or band on the Monument Sign for Subtenant’s use. Any signage of Subtenant installed on the Monument Sign is referred to herein as
“Subtenant’s Monument Signage”. Any such signage will be installed at Subtenant’s sole cost and expense by contractors designated by Sublandlord. The graphics, materials, color, design, lettering, lighting, size, specifications,
location and manner of affixing the Subtenant’s Monument Signage shall be subject to Sublandlord’s prior approval, which shall not be unreasonably withheld, and will be further subject to compliance with all laws, ordinances, restrictions
of record and easements affecting same (collectively, “Sign Laws”). Sublandlord’s approval of Subtenant’s Monument Signage shall not constitute a representation by Sublandlord that Subtenant’s Monument Signage
complies with any applicable Sign Laws. Any such signage will be removed by Subtenant at Subtenant’s expense at the earlier to occur of (a) the Expiration Date and (b) the date upon which the signage rights granted herein are
terminated. The rights granted pursuant to this Section 21 are personal to NeurogesX, Inc., and may not be transferred or assigned to any other individual or entity (other than an assignee of Subtenant’s interest in this Sublease or a
subtenant of fifty percent (50%) of the Subleased Premises). 
 21.2 Termination of Signage Rights. Subtenant’s rights to
Subtenant’s Monument Signage shall expire and terminate upon the earlier to occur of the termination of this Sublease or Subtenant’s right to possession of the Subleased Premises. Upon termination of such rights (and in any event upon
termination of this Sublease), Subtenant shall immediately remove Subtenant’s Monument Signage (if installed) and repair all damage caused thereby, at Subtenant’s sole cost and expense. Subtenant’s obligations hereunder shall survive
the termination of this Sublease. 
 22. Telecom Riser Rooms. Each floor of the Building has a separate room (each, a “Telecom
Riser Room”) which was used by the prior occupant of the Building to connect with the main telecommunications distribution frame (“MDF”) serving the Building and the Project; the Telecom Riser Rooms serve as the central point of
distribution for telecommunications fiber for all floors in the Building. As of the date of this Sublease, the Telecom Riser Rooms serving the Subleased Premises shall remain locked unless otherwise determined by Sublandlord, but considered common
space accessible to Sublandlord and upon 

  

 31 

 
prior coordination of such access with, and subject to supervision by, Sublandlord or Sublandlord’s property manager for the Project, or, during
Business Hours, Building occupants (including Subtenant). Building occupants who wish to use the telecom riser fiber in the Building may require access to all Telecom Riser Rooms (including Telecom Riser rooms on floors other than the floors on
which their separate subleased premises are located) through which their fiber passes. Subtenant may elect to use the Telecom Riser Rooms serving the Subleased Premises for connecting to the MDF, however, Subtenant may not interfere with any
pre-existing Building fiber installed in or connected to any Telecom Riser Room nor may Subtenant prevent Sublandlord (or any other Building occupants) from accessing the Telecom Riser Rooms serving the Subleased Premises; however, Subtenant will
have the right to supervise the performance of any other occupants’ work in the Telecom Riser Rooms on the floor(s) where the Subleased Premises are located (and, similarly, if Subtenant wishes to have access to the Telecom Riser Rooms on any
floor in the Building where the Subleased Premises is not located, Subtenant may be subject to the supervision of the occupant(s) of such floor during the performance of any such work). Except in the case of an emergency, Sublandlord (and any other
Building occupants) shall provide Subtenant with reasonable advance notice (which may be telephonic) of any such access and such access shall be during normal business hours. Sublandlord (and any other Building occupants) shall comply with
Subtenant’s reasonable security measures and shall not unreasonably interfere with Subtenant’s use of the Subleased Premises. All work performed by or on behalf of Subtenant in any Telecom Riser Room will be performed in strict compliance
with such guidelines as Sublandlord may, from time to time, promulgate. Alternatively, Subtenant may elect to relocate Subtenant’s voice and data cabling to another location within the Subleased Premises at Subtenant’s sole cost and
expense. All vertical cabling to be installed by Subtenant shall be in such room in a location designated and approved by Sublandlord and Sublandlord may need future access to allow other Subtenants to core drill and pull additional fiber.
Notwithstanding the foregoing, Subtenant shall be permitted to place its servers in the Telecom Riser Room located on the second (2nd) floor of the Building, subject to the access restrictions described above. 
 23. [INTENTIONALLY OMITTED] 
 24.
Project Renovations. It is specifically understood and agreed that Landlord has no obligation and has made no promises to alter, remodel, improve, renovate, repair or decorate the Subleased Premises, Building, or any part thereof and that no
representations respecting the condition of the Subleased Premises or the Building have been made by Sublandlord to Subtenant except as specifically set forth herein. However, Subtenant hereby acknowledges that Sublandlord is currently renovating or
may during the Term renovate, improve, alter, or modify (collectively, the “Renovations”) the Project or the Building. So long as such Renovations do not unreasonably interfere with Subtenant’s use of or access to the Subleased
Premises or parking, Subtenant hereby agrees that such Renovations shall in no way constitute a constructive eviction of Subtenant nor, except as expressly set forth in Section 6.2 above, entitle Subtenant to any abatement of Rent. So long as
such Renovations do not unreasonably interfere with Subtenant’s use of or access to the Subleased Premises or parking, Sublandlord shall have no responsibility and shall not be liable to Subtenant for any injury to or interference with
Subtenant’s business arising from the Renovations, nor shall Subtenant be entitled to any compensation or damages from Sublandlord for loss of the use of the whole or any part of the Subleased Premises or of Subtenant’s personal property
or improvements resulting from the Renovations, or for any inconvenience or annoyance occasioned by such Renovations. 
  

 32 

 25. Brokers. Subtenant represents that it has dealt directly with and only with Cornish &
Carey, Inc. (“Subtenant’s Broker”), as a broker in connection with this Sublease. Sublandlord represents that it has dealt directly with and only with Colliers International (“Sublandlord’s Broker”), as a broker in
connection with this Sublease. Sublandlord and Subtenant shall indemnify and hold each other harmless from all claims of any brokers other than Subtenant’s Broker and Sublandlord’s Broker claiming to have represented Sublandlord or
Subtenant in connection with this Sublease. Subtenant and Sublandlord agree that Subtenant’s Broker and Sublandlord’s Broker shall be paid commissions by Sublandlord in connection with this Sublease pursuant to a separate agreement.

 26. Complete Agreement. There are no representations, warranties, agreements, arrangements or understandings, oral or written,
between the parties or their representatives relating to the subject matter of this Sublease which are not fully expressed in this Sublease. This Sublease cannot be changed or terminated nor may any of its provisions be waived orally or in any
manner other than by a written agreement executed by both parties. 
 27. USA Patriot Act Disclosures. Subtenant is currently in
compliance with and shall at all times during the Term remain in compliance with the regulations of the Office of Foreign Asset Control (“OFAC”) of the Department of the Treasury (including those named on OFAC’s Specially Designated
and Blocked Persons List) and any statute, executive order (including the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism), or other
governmental action relating thereto. 
 28. Interpretation. Irrespective of the place of execution or performance, this Sublease
shall be governed by and construed in accordance with the laws of the State of California. If any provision of this Sublease or the application thereof to any person or circumstance shall, for any reason and to any extent, be invalid or
unenforceable, the remainder of this Sublease and the application of that provision to other persons or circumstances shall not be affected but rather shall be enforced to the extent permitted by law. The table of contents, captions, headings and
titles, if any, in this Sublease are solely for convenience of reference and shall not affect its interpretation. This Sublease shall be construed without regard to any presumption or other rule requiring construction against the party causing this
Sublease or any part thereof to be drafted. If any words or phrases in this Sublease shall have been stricken out or otherwise eliminated, whether or not any other words or phrases have been added, this Sublease shall be construed as if the words or
phrases so stricken out or otherwise eliminated were never included in this Sublease and no implication or inference shall be drawn from the fact that said words or phrases were so stricken out or otherwise eliminated. Each covenant, agreement,
obligation or other provision of this Sublease shall be deemed and construed as a separate and independent covenant of the party bound by, undertaking or making same, not dependent on any other provision of this Sublease unless otherwise expressly
provided. All terms and words used in this Sublease, regardless of the number or gender in which they are used, shall be deemed to include any other number and any other gender as the context may require. The word “person” as used in this
Sublease shall mean a natural person or persons, a partnership, a corporation or any other form of business or legal association or entity. 
  

 33 

 29. Counterparts. This Sublease may be executed in separate counterparts, each of which shall
constitute an original and all of which together shall constitute one and the same instrument. This Sublease shall be fully executed when each party whose signature is required has signed and delivered to each of the parties at least one
counterpart, even though no single counterpart contains the signatures of all parties hereto. 
 30. Landlord Consent. This Sublease
and Sublandlord’s and Subtenant’s obligations hereunder are conditioned upon receipt of the Consent. If Sublandlord fails to obtain the Consent within thirty (30) days after execution of this Sublease by Sublandlord, then either party
may terminate this Sublease by giving the other written notice thereof on or before the date of procurement of the Consent, in which event Sublandlord shall return to Subtenant the Initial Letter of Credit and any prepaid Rent. 
 31. Sublandlord’s Representations. As an inducement to Subtenant to enter into this Sublease, Sublandlord represents that (a) the Master
Lease is in full force and effect, and there exists under the Master Lease no default or event of default by either Landlord or Sublandlord and (b) the copy of the Master Lease attached hereto as Exhibit H is a true, correct and complete
copy of the Master Lease. 
 32. Approvals. Whenever this Sublease requires an approval, consent, designation, determination or
judgment by either Sublandlord or Subtenant, except as where expressly set forth herein to the contrary, such approval, consent, designation, determination or judgment and any conditions imposed thereby shall be reasonable and shall not be
unreasonably withheld or delayed. 
 IN WITNESS WHEREOF, the parties hereto hereby execute this Sublease as of the day and year first above
written. 
  

			
	 SUBLANDLORD:
	 	 ORACLE USA, INC.,
 a Colorado
corporation

					
		
	 By:
	 	 /s/ Randall W. Smith

	 Print Name:
	 	Randall W. Smith
	 Title:
	 	VP Real Estate & Facilities

			
		
	 SUBTENANT:
	 	 NEUROGESX, INC.
 a Delaware
corporation

					
		
	 By:
	 	 /s/ Stephen Ghiglieri

	 Print Name:
	 	Stephen Ghiglieri
	 Title:
	 	CFO

  

 34 

 EXHIBIT A 
 Subleased Premises 
 

 
  

 1 

 EXHIBIT B 
  

Commencement Agreement 
  

			
	 Date
	  	September 13, 2007
		
	 Subtenant
	  	NEUROGESX, INC.
	 Address
	  	981F Industrial Road
		  	San Carlos, CA 94070
		  	Attn: Steve Grana, Controller & Senior Director

  

			
	Re:	 	Commencement Letter with respect to that certain Sublease dated as of the 6th day of September,
2007 by and between ORACLE USA, INC., a Colorado corporation, as Sublandlord, and NEUROGESX, INC., a Delaware corporation, as Subtenant, for 26,386 rentable square feet on the second (2nd) floor of the Building located at 2215 Bridgepointe Parkway, San Mateo, California.

 Dear Steve: 
 In accordance with the terms and conditions of the above referenced Sublease, Subtenant accepts possession of the Subleased Premises and agrees: 
  

	 	1.	The Commencement Date is September 14, 2007; 

  

	 	2.	The Expiration Date is July 31, 2012; 

  

	 	3.	The Rent Commencement Date is: February 14, 2008; and 

  

	 	4.	The Schedule of Base Rent is: 

  

										
	 Period
	  	 Monthly Base Rent
 Per Rentable
 Square
Foot
	  	 Rentable Square Foot
 Upon Which Base
 Rent is Payable

	  	 Monthly
 Base Rent
	 
	 September 14, 2007 to February 13, 2008
	  	$	0.00	  	0	  	$	0.00	 
	 February 14, 2008 to February 28, 2008
	  	$	1.50	  	20,000	  	$	16,071.40	*
	 March 1, 2008 to August 31, 2008
	  	$	1.50	  	20,000	  	$	30,000.00	 
	 September 1, 2008 to August 31, 2009
	  	$	1.60	  	20,000	  	$	32,000.00	 
	 September 1, 2009 to August 31, 2010
	  	$	1.70	  	26,386	  	$	44,856.20	 
	 September 1, 2010 to Sept. 13, 2011
	  	$	1.90	  	26,386	  	$	50,133.40	 
	 September 1, 2011 to Expiration Date
	  	$	2.00	  	26,386	  	$	52,772.00	 

	*	The Base Rent and Additional Rent for the first partial month will be prorated by multiplying the monthly Base Rent and Additional Rent by a fraction, the numerator of which is the
number of days of the partial month and the denominator of which is the total number of days in the full calendar month. 

  

 1 

 Please acknowledge your acceptance of possession and agreement to the terms set forth above by signing
all 3 counterparts of this Commencement Letter in the space provided and returning 2 fully executed counterparts to Phil Arnautou at Colliers International, Two Palo Alto Square, Suite 200, Palo Alto, CA 94306. 
  

	
	 Sincerely,

	
	 ORACLE USA, INC.

	
	 

	 Cliff Berry

	 Director

	 Headquarters Real Estate

  

					
		
		 	Agreed and Accepted:
			
		 	Subtenant:	 	NEUROGESX, INC.
		 	By:	 	 /s/ Stephen Ghiglieri

		 	Name:	 	Stephen Ghiglieri
		 	Title:	 	CFO
		 	Date:	 	9/27/07

 EXHIBIT C 
 Furniture Inventory 
 2215 Bridgepointe, Bldg 1, 2nd floor 
 Inventory & Definitions 
 (18) Standard Private Offices
– Kimball Cetra/Footprint Furniture will contain: 
 (1) P-top worksurface, corner worksurface and (2) straight worksurface;
(3) chairs and (1) short bookcase. (12 DO NOT have bookcases) 
 

 
 (86) Cubes—Standard Kimball Cetra/Footprint (8’ x 8’) Furniture will contain: 
 (2) 48” work surfaces – laminate; (1) Corner work surface – laminate; (2) wood file pedestals; (2) chairs; (1) overhead
storage with built in desk light. 
 (3 cubes only have 1 chair) 
 

 
 (2) Large Conference Rooms 
  

	 	•	 	 Each conference room has oval table, (10+) office task chairs 

 (2) Medium Conference Room 
  

	 	•	 	 Conference room has oval table, (6+) office task chairs 

 (2) Small Conference Rooms 
  

	 	•	 	 Each conference room has (1) round table, (4+) office task chairs 

  

 1 

 2215 Bridgepointe, Bldg 1, 5th floor Cont... 
 (2) Lounge Areas 
  

	 	•	 	 Each lounge area has (3) club chairs and (1) occasional table 

 (2) Mail/Copy Rooms 
  

	 	•	 	 (4) blue Hamilton tables, (2) blue mail sorters 

 Miscellaneous: 
  

	 	•	 	 (16) Lateral file cabinets 

  

 2 

 EXHIBIT D 
 Form Letter of Credit 
 ISSUING BANK 
 ADDRESS OF ISSUING BANK 
 DATE:
                     
 IRREVOCABLE STANDBY LETTER
OF CREDIT NUMBER:                      
  

					
	 BENEFICIARY:
	 		 	APPLICANT:
	  
	 		 	  

	  
	 		 	  

 AMOUNT: USD
$                     
 EXPIRATION:
                     AT OUR COUNTERS 
 WE HEREBY
ESTABLISH IN YOUR FAVOR OUR IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                      WHICH IS AVAILABLE WITH [ISSUING BANK] BY PAYMENT
AGAINST PRESENTATION OF THE ORIGINAL OF THIS LETTER OF CREDIT AND YOUR DRAFTS AT SIGHT DRAWN ON [ISSUING BANK] AT THE ADDRESS ABOVE, ACCOMPANIED BY THE DOCUMENTS DETAILED BELOW: 
 A LETTER SIGNED BY A PURPORTED AUTHORIZED REPRESENTATIVE OF THE BENEFICIARY STATING THAT BENEFICIARY IS ENTITLED TO DRAW ON THIS LETTER OF CREDIT IN THE REQUESTED AMOUNT PURSUANT TO THAT SUBLEASE AGREEMENT BETWEEN
                                        
AND
                                        ,
AS IT MAY BE AMENDED. 
 THIS LETTER OF CREDIT CANNOT BE MODIFIED OR REVOKED WITHOUT YOUR WRITTEN CONSENT OF BENEFICIARY. 
 SPECIAL CONDITIONS: 
 THIS LETTER OF CREDIT SHALL AUTOMATICALLY RENEW WITHOUT
AMENDMENT FOR AN ADDITIONAL ONE YEAR PERIOD FROM THE CURRENT OR FOR ANY FUTURE EXPIRATION DATE, UNLESS WE SHALL NOTIFY YOU IN WRITING BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED OR OVERNIGHT COURIER AT LEAST 60 DAYS PRIOR TO THE THEN CURRENT
EXPIRATION DATE THAT THIS LETTER OF CREDIT WILL NOT BE RENEWED. FOLLOWING SUCH NOTIFICATION AND PRIOR TO THE EXPIRATION OF THIS LETTER OF CREDIT, YOU MAY DRAW UPON THIS LETTER OF CREDIT BY PRESENTATION OF THE SIGHT DRAFT(S) MENTIONED ABOVE,
ACCOMPANIED BY A LETTER SIGNED BY A 

  

 1 

 
PURPORTED AUTHORIZED REPRESENTATIVE OF BENEFICIARY STATING THAT BENEFICIARY HAS NOT BEEN PRESENTED WITH A SUBSTITUTE LETTER OF CREDIT IN THE SAME PRINCIPAL
AMOUNT, AND ON THE SAME TERMS AS THIS LETTER OF CREDIT FROM AN ISSUER REASONABLY SATISFACTORY TO YOU. 
 THIS LETTER OF CREDIT IS TRANSFERABLE AND MAY BE
TRANSFERRED ONE OR MORE TIMES BY THE NAMED BENEFICIARY HEREUNDER OR BY ANY TRANSFEREE HEREUNDER TO A SUCCESSOR TRANSFEREE. TRANSFER OF THIS LETTER OF CREDIT IS SUBJECT TO OUR RECEIPT OF BENEFICIARY’S INSTRUCTIONS IN THE FORM ATTACHED AS EXHIBIT
A, ACCOMPANIED BY THE ORIGINAL LETTER OF CREDIT AND AMENDMENT(S), IF ANY. 
 PARTIAL DRAWS ARE ALLOWED UNDER THIS LETTER OF CREDIT. 
 THIS LETTER OF CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 590 AND
ENGAGES US PURSUANT TO THE TERMS THEREIN. 
  

					
	 [ISSUING BANK]
	 		 	
			
	 AUTHORIZED SIGNATURE
	 		 	AUTHORIZED SIGNATURE

  

 2 

 EXHIBIT E 
 Rules and Regulations 
 1. Sidewalks, doorways, halls, stairways, vestibules and other similar
areas shall not be obstructed by any tenant or used by them for purpose other than ingress to and egress from their respective Subleased Premises, and for going from one part of the Building to another part. 
 2. Plumbing fixtures shall be used only for their designated purpose, and no foreign substances of any kind shall be deposited therein. Damage to any
such fixture resulting from misuse by Subtenant or any employee or invitee of Subtenant shall be repaired at the expense of Subtenant. 
 3.
Nails, screws and other attachments to the Building require prior written consent from Sublandlord. 
 4. All contractors and technicians
rendering any installation service to Subtenant shall be subject to Sublandlord’s approval and supervision prior to performing services. This applies to all work performed in the Building, including, but not limited to, installation of
telecommunications equipment, and electrical devices, as well as all installation affecting floors, walls, woodwork, windows, ceilings, and any other physical portion of the Building. 
 5. Movement in or out of the Building of furniture, office equipment, or other bulky material which requires the use of elevators, stairways, or Building
entrance and lobby shall be restricted to hours established by Sublandlord. All such movement shall be under Sublandlord’s supervision, and the use of an elevator for such movements shall be made restricted to the Building’s freight
elevators, or an elevator for such movements shall be made restricted to the Building’s freight elevators. Prearrangements with Sublandlord shall be made regarding the time, method, and routing of such movement, and Subtenant shall assume all
risks of damage and pay the cost of repairing or providing compensation for damage to the Building, to articles moved and injury to persons or public resulting from such moves. Sublandlord shall not be liable for any acts or damages resulting from
any such activity. 
 6. Corridor doors, when not is use, shall be kept closed. 
 7. Subtenant shall cooperate with Sublandlord in maintaining the Subleased Premises. Except as expressly set forth in the Sublease, Subtenant shall not
employ any person for the purpose of cleaning the Subleased Premises other than the Building’s cleaning and maintenance personnel. 
 8.
Deliveries of water, soft drinks, newspapers, or other such items to any Subleased Premises shall be restricted to hours established by Sublandlord. 
 9. Nothing shall be swept or thrown into the corridors, halls, elevator shafts, or stairways. No birds, fish, or animals of any kind shall be brought into or kept in, on or about the Subleased Premises. 
  

 1 

 10. No cooking shall be done in the Subleased Premises except in connection with convenience lunch room
or beverage service for employees and guests (on a noncommercial basis) in a manner which complies with all of the provisions of the Sublease and which does not produce fumes or odors. 
 11. Food, soft drink or other vending machines shall not be placed within the Subleased Premises without Sublandlord’s prior written consent.

 12. Subtenant shall not use or keep on its Subleased Premises any kerosene, gasoline, or inflammable or combustible fluid or material
other than limited quantities reasonably necessary for the operation and maintenance of office equipment. 
 13. Subtenant shall not tamper
with or attempt to adjust temperature control thermostats in the Subleased Premises. Sublandlord shall make adjustments in thermostats on call from Subtenant. 
 14. Subtenant shall comply with all requirements necessary for the security of the Building, including the use of service passes issued by Sublandlord for after hours movement of office equipment/packages, and signing
security register in Building lobby after hours. 
 15. Upon termination of this Lease, Subtenant shall surrender to Sublandlord all keys and
access cards to the Subleased Premises, and give to Sublandlord the combination of all locks for safes and vault doors, if any, in the Subleased Premises. 
 16. Sublandlord retains the right, without notice or liability to any occupant, to change the name and street address of the Building. 
 17. Canvassing, peddling, soliciting, and distribution of handbills in the Building are prohibited and each tenant shall cooperate to prevent these activities. 
 18. Subtenant shall take reasonable steps to prevent the unnecessary generation of refuse (e.g., choosing and using products, packaging, or other
materials in business that minimize solid waste or that are durable, reusable, or recyclable). Subtenant shall provide or obtain recycling containers in its business for use by employees and customers, shall recycle acceptable materials in the
recycling containers provided by Sublandlord, and shall otherwise participate in the recycling program established by Sublandlord for the Building. Acceptable recyclable materials may include, but are not limited to, the following: newspaper,
cardboard, paperboard, office paper and other mixed paper, aluminum, tin and other metal, glass, and #1 (PETE) and #2 (HDPE) plastics. 
 19.
Subtenant shall not and shall cause its employees, agents, contractors, invitees, customers and visitors not to smoke in the Subleased Premises or in any portion of the Building, except those areas, if any, expressly designated as smoking areas by
Sublandlord. Persons may smoke cigarettes in designated areas only if the smoker uses designated receptacles for ashes and cigarette butts and does not annoy any nonsmoking persons using the area or interfere with access to the Building. 

 

 2 

 20. Sublandlord reserves the right to rescind or modify any of these rules and regulations and to make
future rules and regulations required for the safety, protection, and maintenance of the Building, the operation and preservation of good order thereof, and the protection and comfort of the tenants and their employees and visitors. Such rules and
regulations, when made and written notice given the Subtenant, shall be binding as if originally included herein. In the event of any inconsistency between the Sublease and these rules and regulations, the terms and conditions of the Sublease shall
prevail. 
  

 3 

 EXHIBIT F 
 Construction Guidelines for Contracted Services 
 The following outlines the regulations and
requirements, which will be required of contracted service personnel working at or in the Building. No deviation or exception will be permitted without the express written approval of Sublandlord or its property manager. 
 1. All contractors to perform work at the Project must be reasonably approved by Sublandlord prior to the commencement of any construction. 

2. Prior to any entry onto the Building, Subtenant or any contractors, as applicable, shall have provided to Sublandlord certificates of insurance, in
form and amount satisfactory to Sublandlord, evidencing the following insurance coverages: 
 a. Worker’s compensation insurance
covering all of their respective employees, and shall also carry public liability insurance, including property damage, all with limits, in form and with companies as are reasonably required by Sublandlord. 
 b. Subtenant shall carry “Builder’s All Risk” insurance in an amount approved by Sublandlord or Landlord covering the construction of the
work in question, and such other insurance as Sublandlord or Landlord may reasonably require. Such insurance shall be in amounts and shall include such extended coverage endorsements as may be reasonably required by Sublandlord or Landlord.

 All such policies of insurance must contain a provision that the company writing said policy will give Sublandlord thirty (30) days
prior written notice of any cancellation or lapse of the effective date or any reduction in the amounts of such insurance. All policies shall insure Landlord, Sublandlord and Subtenant, as their interests may appear, as well as Subtenant’s
contractors, and shall name as additional insureds Sublandlord’s property manager. All insurance, except Workers’ Compensation, maintained by Subtenant’s contractors shall preclude subrogation claims by the insurer against anyone
insured thereunder. Such insurance shall provide that it is primary insurance as respects the owner and that any other insurance maintained by owner is excess and noncontributing with the insurance required hereunder. 
 c. Sublandlord must be named on all warranties and guaranties for all products being guarantied or warranted by any contractor, sub-contractor, and/or
manufacturing supplier. 
 3. All workers must be properly, permanently and visually identified. The identification system must be approved
prior to the start of any work and may take the form of badges for attachment to clothing. All companies will maintain an updated list of authorized workers with building management and notify management of each change. 
 4. All workers shall maintain their actions while in the Building in a professional manner to include but not limited to the following: 
 a. No abusive language. 
  

 1 

 b. No smoking, eating or drinking except in areas designated by the Building manager. 
 c. No use of radios. 
 5. Offenses that will
result in immediate request for discharge include, but are not limited to the following: 
 a. Drinking alcoholic beverages on the job, or
coming to work in an intoxicated condition. 
 b. Possession or consuming drugs or any other illegal substances while at the property.

 c. Using or removing Building manager’s, tenant’s or subcontractor’s possessions from the property without prior
authorization. 
 d. Violating any state or federal statutes while working at the Building. 
 e. Possessing firearms or explosives while working at the Building. 
 f. Using property facilities for jobs other than specific work assignments. 
 g. Accepting commissions, fees
or kickbacks from any vendors, tenants or contractors involved in providing a service or product to the Building. 
 h. Physically abusing or
harming any individual who works at or visits the Building. 
 i. Duplicating any keys used in the Building. 
 j. Providing Building access at anytime to anyone not authorized by Building manager. 
 6. Contractor and contractor employee parking shall be only in areas reasonably designated by Sublandlord. The loading dock will not be used for parking.
Oversized vehicles will use street parking as far as possible from public entries and operating retail facilities. 
 7. All construction
staging storage and temporary contractor facilities will be located in specific areas assigned by the Building management. Contractors will be responsible for the maintenance, housekeeping and demolition of all temporary facilities. 
 8. The entrances lobbies passages corridors elevators stairways and other common areas will not be obstructed by any of the contractors agents during
construction. 
 9. No storage of flammable substances will be allowed or stored in the Building unless approved by Building management and
in accordance with approved building codes and regulations. 
  

 2 

 10. Any work that would cause an inconvenience (in Sublandlord’s reasonable discretion) to other
occupants in the Building or any work in an occupied lease space must be done after Building Hours or on the weekend. Any structural modifications or floor penetrations created with the use of core drilling machines pneumatic hammers etc. must be
performed between the hours of 1 p.m. to 6:00 p.m. on Saturdays and 11:00 a.m. to 6:00 p.m. on Sundays or as otherwise permitted by law and the Building rules and regulations. Likewise any construction techniques causing excessive noise or vapors
will be conducted only during these hours. 
 11. Prior to starting the work the general mechanical and electrical contractors will check in
and go over the job with the chief Building engineer and will furnish to such building engineer mechanical and electrical shop drawings. All panels and transformers are to match the “Building Standard” systems and all materials and methods
used to connect panels and transformers must be approved by Sublandlord. In connection therewith: 
 a. The Building is fed with Cutler Hammer
Bus duct, any time a new 480 volt panel is added, Contractor must add a Cutler Hammer Bus duct disconnect; 
 b. The existing transformers
serving the Building are Cutler Hammer; all transformers need to be copper and K13 rated; 
 c. The existing panels are Cutler Hammer. Any
120/208 and 277/480 volt panels need to be copper bus, bolt on breakers and 65K A/C rated. It is critical that any breakers installed in the panels at 65K rated; and 
 d. The fire alarm system is an Edwards addressable fire alarm panel; any contractor who performs who affecting this system must e approved in advance by Sublandlord. 
 12. Dust and air contamination are to be controlled with temporary partitions which are sealed adequately to prevent dust from entering leased areas or
mechanical equipment. Floor sweep or a comparable material will be used when sweeping concrete or tile floors. If air conditioning is provided to construction space, air handler filters will be replaced at the completion of work at contractors’
expense. 
 13. Contractors are prohibited from staining, painting (except wall painting), or lacquering during the working hours of 8:00
a.m. - 6:00 p.m. Monday - Friday and 8:00 a.m. - 2:00 p.m. Saturday [(except wall painting)]. All such work must be stopped by 5:00 a.m. on mornings of normal business days. Contractor shall provide and maintain deodorizing and air purifier machines
during all painting applications and for a minimum of six (6) hours after all operations have stopped. 
 14. There will be absolutely
no use of Sublandlord’s property to include, but not be limited to, telephones, dollies, vending machines, copiers, etc. unless specifically approved in writing by the tenant in advance of their use. Any unauthorized telephone charges will be
billed back to the Contractor. 
 15. No supplies, trash, or storage of these will be allowed in the dock area at any time. 
  

 3 

 16. No doors will be propped open or held open to the degree that such will cause an alarm or jeopardize
security. Contractors shall be responsible for charges resulting from such alarms and/or security violations. 
 17. Dust and air
contamination are to be controlled with temporary partitions which are sealed adequately to prevent dust from entering leased areas or mechanical equipment. Floor sweep or a comparable material will be used when sweeping concrete or tile floors. If
air conditioning is provided to construction space, air handler filters will be replaced at the completion of work at contractors’ expense. 
 18. Contractor is prohibited from staining, painting (except wall painting), or lacquering during the working hours of 8:00 a.m. - 6:00 p.m. Monday - Friday and 8:00 a.m. - 2:00 p.m. Saturday [(except wall painting)]. All such work must be
stopped by 5:00 a.m. on mornings of normal business days. Contractor shall provide and maintain deodorizing and air purifier machines during all painting applications and for a minimum of six (6) hours after all operations have stopped.

 19. There will be absolutely no use of Sublandlord’s property to include, but not be limited to, telephones, dollies, vending
machines, copiers, etc. unless specifically approved in writing by the tenant in advance of their use. Any unauthorized telephone charges will be billed back to the Contractor. 
 20. No supplies, trash, or storage of these will be allowed in the dock area at any time. 
 21. No doors will be propped open or held open to the degree that such will cause an alarm or jeopardize security. Contractor shall be responsible for
charges resulting from such alarms and/or security violations. 
 22. The Building’s manager, at its sole discretion, may require any
general contractor to use masonite to cover the floors. All moving companies will be required to cover the floors with masonite prior to any items entering or exiting the Building. 
 23. All work areas are to be broom cleaned daily of trash, debris and non-useful materials. Failure to do so will result in Building management providing
this service and charging the Subtenant or Subtenant’s general contractor accordingly. The general contractor is responsible for providing trash receptacles. The Building compactor will not be used unless prior approval has been granted by
Building management. Walk-off mats, plastic tarping and Masonite will be used to avoid unnecessary debris and buildup. If cleanup does not meet with Building management satisfaction, building personnel will clean the area and back-charge the
responsible contractor. 
 24. Fire alarm speakers must be installed and connected to the Building’s existing system throughout the
Premises in compliance with applicable Fire Code requirements. Contractor shall coordinate all Fire Alarm and Fire Sprinkler system related work with Building security and Building engineering. No Fire Alarm or Fire Sprinkler system related work
will be performed until proper steps have been taken to assure that false alarms will not sound, that adequate building protection will be maintained, and that the proper agencies have been notified 

  

 4 

 
of Fire Safety system downtime. Contractor will also coordinate with Building Security and Building Engineering for the proper restoration of Fire Alarm and
Fire Sprinkler systems to normal operation once work is complete. Under no circumstances will Contractor leave the property until all Fire Alarm and Fire Sprinkler systems, which they have affected, have been restored to their normal operating
conditions. 
 25. The General Contractor shall maintain all applicable federal, state and local rules and regulations for each Building as
required. 
 26. Since each job is different in scope, it may be necessary that the contractors set up job meetings according to the job
needs. Each contractor must set their own time interval between meetings, notify Building management of their scheduling, and once the intervals are set, maintain them on a regular basis. This will help to coordinate and control attendance.

 27. Any contractor who anticipates work on the Building’s life safety systems (sprinklers, smoke detectors, fire command speakers,
fire alarms, etc.) will notify Building management 24 hours in advance prior to commencement of work. 
 28. All work to be performed after
hours must be scheduled with Building management art least 24 hours in advance and must be accompanied by a security clearance request. 
 29. Bobtails, semi-trailers, etc. are authorized to be parked in the loading dock only for the time necessary to unload equipment and material. Unless prior approval is obtained from Building management vehicles left at the loading dock
will be towed at owner’s expense. No contractors or their employees are authorized to park in visitors parking or in any fire lanes at any time. 
 30. Material deliveries must be scheduled through Building management. Freight elevators will be the only elevators used by contractor or agents. When the freight elevator is used to move materials, contractors will
required to release the elevator immediately after unloading is complete. The elevator will not be placed on independent service without prior approval of Building management. Landlord will cooperate with contractor regarding contractor’s use
of the freight elevators and loading docks and in the placement of dumpsters to be provided by contractor and Landlord will not charge a fee in connection with the use or accommodation thereof. 
 31. Contractor personnel are not to use tenant occupied areas, including vending machines and break-rooms, at any time. Restrooms on tenant occupied
floors are not to be used by contractor personnel. Contractor personnel are to use only the restrooms specified by Building management. Unless on specific assignment which has been pre-approved by Building management. no contractor personnel are to
enter tenant office areas. 
 32. Applicable keys and access cards are controlled and distributed by the security department. If a contractor
wishes to check out keys or access cards, they must be prepared to surrender their driver’s license on request. The driver’s license will be returned when the equipment is returned. contractors will not issue keys or access cards for
service areas, utility 

  

 5 

 
closets or other Building areas to anyone including tenants, telephone and utility personnel or other construction workers. Keys and access cards will not be
taken off property for any reason. If any keys are lost, contractor will be subject to a replacement fee. This may also include the cost of re-keying the affected area or possibly the entire Building. 
 33. Any damage to other tenant spaces, public areas or common facilities of the building is to be reported immediately to Building management. Contractor
is expected to repair any damage made by their personnel. If corrections are not made, Building personnel will make the necessary repairs and back-charge the responsible contractor. 
 34. Contractors shall check in and out with Building security on a daily basis. 
 35. Contractor shall take appropriate action to prevent false fire alarm or other unnecessary alarm, which may occur as a direct or indirect result of
their work. This shall include protection of smoke detection devices from smoke, dust and debris during construction, use of sweeping compound when sweeping floors to prevent dust, and proper precautionary measures taken when working around other
alarm initiating devices such as pull stations, water flow devices and Fire Safety related power devices. All work that, for any reason, may activate the Fire Alarm system must first be reported to Building security so that appropriate measure may
be taken to prevent a false alarm. Such work includes, but is not limited to sweeping, painting, sanding, soldering, brazing, welding, sawing, etc. 
 36. Contractor is to provide, and pay all fees for, all permits, inspection, certificates of occupancy, maintenance and operation manuals, equipment warranties, etc. 
 37. Should the contractor perform any work that does not comply with the requirements of applicable laws, Subtenant shall bear all costs that arise in
correcting such defects. 
 38. All contractors (including the general contractor) shall contact Sublandlord and schedule time periods during
which they may use Building and Building facilities in connection with the Contractor of Subtenant Alterations (e.g., elevators, excess electricity, etc.). 
 39. Contractor shall maintain existing plumbing, HVAC, and fire alarm systems, as well as other existing systems, and must retain all existing functions in service except for scheduled interruptions approved by
Building management 24-hours in advance. 
 40. Any Building-wide power shutdowns must be scheduled with Sublandlord and Landlord at least
thirty (30) days prior to the shutdown in question. 
 All penetrations of piping, duct work, etc. through walls partitions and floors
shall be sealed to Building management’s satisfaction to maintain the integrity of the Building’s fire safety rating. Also, any openings in walls and partitions made by the contractor for access to construction work shall be patched and/or
repaired to Building management’s satisfaction. All core drill pieces are to be removed by the contractor 
  

 6 

 EXHIBIT G 
 Initial Subtenant Alterations 
 

 
  

 1 

 

 
  

 2 

 

 
  

 3 

 EXHIBIT H 
 Master Lease 
 Lease between 
 Sobrato Interests III and Siebel Systems, Inc. 
 Building 1 – 2215
Bridgepointe Parkway, San Mateo 
  

			
	Section	  	Page #
	 Parties
	  	1
	 Premises
	  	1
	 Definitions
	  	1
	 Grant
	  	2
	 Recordation of Parcel Map and Declaration
	  	2
	 Use
	  	3
	 Permitted Uses
	  	3
	 Uses Prohibited
	  	3
	 Advertisements and Signs
	  	4
	 Covenants, Conditions and Restrictions
	  	4
	 Term and Rental
	  	4
	 Base Monthly Rent
	  	4
	 Rental Adjustment
	  	5
	 Late Charges
	  	5
	 Security Deposit
	  	6
	 Construction
	  	7
	 Building Shell Plans
	  	7
	 Tenant Improvement Plans
	  	7
	 Tenant Improvement Pricing
	  	8
	 Change Orders
	  	9
	 Building Shell Costs
	  	9
	 Tenant Improvement Costs
	  	9
	 Construction
	  	9
	 General Contractor Overhead & Profit
	  	10
	 Tenant Delays
	  	10
	 Insurance
	  	11
	 Punch List & Warranty
	  	11
	 Other Work by Tenant
	  	11
	 Acceptance of Possession and Covenants to Surrender
	  	11
	 Delivery and Acceptance
	  	11
	 Condition Upon Surrender
	  	12
	 Failure to Surrender
	  	13
	 Alterations and Additions
	  	13
	 Tenant’s Alterations
	  	13
	 Free From Liens
	  	14

  

 -i- 

			
	 Compliance With Governmental Regulations
	  	14
	 Maintenance of Premises
	  	14
	 Landlord’s Obligations
	  	14
	 Tenant’s Obligations
	  	15
	 Landlord and Tenant’s Obligations Regarding Reimbursable Operating Costs
	  	15
	 Reimbursable Operating Costs
	  	15
	 Tenant’s Allocable Share
	  	16
	 Exclusions to Reimbursable Operating Costs
	  	16
	 Waiver of Liability
	  	17
	 Tenant’s Right to Audit
	  	17
	 Hazard Insurance
	  	18
	 Tenant’s Use
	  	18
	 Landlord’s Insurance
	  	18
	 Tenant’s Insurance
	  	19
	 Waiver
	  	19
	 Taxes
	  	19
	 Utilities
	  	20
	 Toxic Waste and Environmental Damage
	  	20
	 Tenant’s Responsibility
	  	20
	 Tenant’s Indemnity Regarding Hazardous Materials
	  	21
	 Landlord’s Indemnity Regarding Hazardous Materials
	  	21
	 Actual Release by Tenant
	  	22
	 Environmental Monitoring
	  	23
	 Tenant’s Default
	  	23
	 Remedies
	  	23
	 Right to Re-enter
	  	24
	 Abandonment
	  	24
	 No Termination
	  	25
	 Non-Waiver
	  	25
	 Performance by Landlord
	  	25
	 Landlord’s Liability
	  	26
	 Limitation on Landlord’s Liability
	  	26
	 Limitation on Tenant’s Recourse
	  	26
	 Indemnification of Landlord
	  	26
	 Destruction of Premises
	  	27
	 Landlord’s Obligation to Restore
	  	27
	 Limitations on Landlord’s Restoration Obligation
	  	27
	 Tenant’s Rights with Respect to a Destruction of the Premises
	  	28
	 Condemnation
	  	28
	 Assignment or Sublease
	  	29
	 Consent by Landlord
	  	29
	 Assignment or Subletting Consideration
	  	30
	 No Release
	  	30
	 Reorganization of Tenant
	  	30
	 Permitted Transfers
	  	31

  

 -ii- 

			
	 Effect of Default
	  	31
	 Conveyance by Landlord
	  	31
	 Successors and Assigns
	  	32
	 Option to Extend the Lease Term
	  	32
	 Grant and Exercise of Option
	  	32
	 Determination of Fair Market Rental
	  	33
	 Resolution of a Disagreement over the Fair Market Rental
	  	33
	 Personal to Tenant
	  	34
	 Option to Lease
	  	34
	 Grant and Exercise of Option
	  	34
	 Grant and Exercise of Option
	  	34
	 Exclusions
	  	35
	 General Provisions
	  	35
	 Attorney’s Fees
	  	35
	 Authority of Parties
	  	35
	 Brokers
	  	35
	 Choice of Law
	  	35
	 Dispute Resolution
	  	35
	 Entire Agreement
	  	37
	 Entry by Landlord
	  	37
	 Estoppel Certificates
	  	38
	 Exhibits
	  	38
	 Interest
	  	38
	 Modifications Required by Lender
	  	38
	 No Presumption Against Drafter
	  	38
	 Notices
	  	39
	 Property Management
	  	39
	 Rent
	  	39
	 Representations
	  	39
	 Rights and Remedies
	  	39
	 Severability
	  	39
	 Submission of Lease
	  	39
	 Subordination
	  	39
	 Survival of Indemnities
	  	41
	 Time
	  	41
	 Transportation Demand Management Programs
	  	41

  

 -iii- 

 1. PARTIES: THIS LEASE, is entered into on this 11th day of March, 1999, (“Effective
Date”) between SOBRATO INTERESTS III; a California Limited Partnership, whose address is 10600 North De Anza Boulevard, Suite 200, Cupertino, CA 95014-2075 and SIEBEL SYSTEMS, INC., a Delaware Corporation, whose address is 1855 South Grant
Street, San Mateo, California, CA 94402-2667, hereinafter called respectively Landlord and Tenant. 
 2. PREMISES: 
 A. Definitions. 
 (i) Building. The term “Building” shall mean that five (5) story steel frame building containing approximately 141,496 rentable square feet and all Tenant Improvements installed therein to be constructed by
Landlord and leased by Tenant pursuant to the terms of this Lease in the location labeled as Building 1 on Exhibit “A” attached hereto and commonly known as 2215 Bridgepointe Parkway. 
 (ii) Building 2. The term “Building 2” shall mean that five (5) story steel frame building containing
approximately 141,496 rentable square feet to be constructed by Landlord and leased by Tenant pursuant to a separate lease between the Parties of even date herewith (“Building 2 Lease”) in the location labeled as Building 2 on
Exhibit “A” and commonly known as 2211 Bridgepointe Parkway. 
 (iii) Building 3. The term
“Building 3” shall mean that five (5) story steel frame building containing approximately 167,505 rentable square feet to be constructed by Landlord end leased by Tenant or by a third party pursuant to the terms of Section 19 of
this lease in the location labeled as Building 3 on Exhibit “B” and commonly known as 2207 Bridgepointe Parkway. 
 (iv) Common Area. The term “Common Area” shall mean that certain real property beneath and surrounding the Building, Building 2 and Building 3 consisting initially of en underground parking
garage of approximately 455 parking spaces, on-grade parking lots consisting of approximately 255 parking spaces, the first two levels of the above grade parking structure consisting of approximately 280 cars, recreation areas and the adjacent
landscaped site areas as shown on Exhibit “A”. At the time of construction of Building 3 the Common Area will be modified by the completion of the above grade parking structure to total approximately 850 parking spaces and
changes to portions of the landscaped sites areas resulting in total parking at full buildout of 1,560 spaces as shown in Exhibit “B” attached hereto. 
 Landlord shall have the power to allocate to each tenant in the Project, the number of parking spaces in file podium garage, above-grade parking
structure or other portions of the Project as to which Tenant may have the use in connection with its Building; provided that (i) such allocation is requested by at least one (1) tenant in the Project, (ii) Landlord shall not allocate
to Tenant materially less than the Tenant’s prorata share of parking calculated on the basis of the square footage of the buildings in the Project, and (iii) Landlord shall allocate parking in a manner so as to maximize the adjacency of
parking to each building. Landlord shall further retain the right to restrict an appropriate amount of the parking for visitors of the Project or for car pooling (as may be required by a TDM program). At the 

 
request of Tenant or any other tenant in the Project, Landlord further agrees to restrict up to ten (10) spaces per building for key employees of Tenant
(or of other tenants in the Project) or for other reasonable uses. Tenant shall be responsible for seeing that the total number of vehicles parked in the Project by employees and invitees of Tenant does not exceed the number of total spaces
allocated to the Building. 
 (v) Project. The term “Project” shall be that certain real property
consisting of approximately 10.8 acres at the corner of Bridgepointe Circle and Bridgepointe Parkway in San Mateo, California and all improvements constructed thereon consisting at full buildout of the Building, Building 2, Building 3 and the Common
Area as shown in Exhibit “B”. 
 (vi) Premises. The term “Premises” shall mean
the Building and a non-exclusive right to use the Common Area. Unless expressly provided otherwise, the term Premises as used herein shall include the Tenant Improvements (defined in Section 5.B) constructed by Tenant pursuant to
Section 5.B. 
 B. Grant: Landlord hereby leases the Premises to Tenant, and Tenant hires the Premises from Landlord.

 C. Recordation of Parcel Map and Declaration: Tenant consents to recordation by Landlord of a Parcel Map (“Parcel
Map”) and a Declaration of Covenants, Conditions and Restrictions (“Declaration”). The Parcel Map and the Declaration shall be substantially in the form attached hereto as Exhibit “C” with such changes as may be
desired by Landlord or Landlord’s lenders to facilitate the operation, construction, financing, sale and/or leasing of the Project, provided such changes do not materially and adversely affect Tenant’s use of the Premises, and with such
changes as may be required by the city or other governmental authority having jurisdiction over the Project. Landlord is seeking approval of the Parcel Map and Declaration to subdivide the existing parcel into the four lots to facilitate
Landlord’s operation, construction, financing, lease and/or sale of the Project as individual buildings. Landlord’s failure to obtain approval of the Parcel Map or Declaration shall in no way invalidate this Lease. In the event the Parcel
Map and Declaration are recorded by Landlord, the Section 2.A.vi shall be replaced by following: The term “Premises” shall mean (i) the land area within Lot 2; (ii) the Building; and (iii) the nonexclusive right to use
the Common Area in accordance with the terms and conditions of the Declaration and this Lease. This Lease shall be subject and subordinate in all respects to the Declaration, as the same may be amended from time to time. Tenant covenants and agrees
to refrain from doing or causing to be done, or permitting any thing or act to be done, which would constitute a default under the Declaration or which would or might make Landlord liable for any damages, claims or penalty. All assessments charged
to the Premises pursuant to the Declaration, (other than those assessments which represent: the costs required to be paid and borne by Landlord under the express terms of this Lease (such as Landlord’s maintenance costs pursuant to
Section 8.A; fines, penalties and costs of suit charged by the Association, to the extent not caused by Tenant’s breach of this Lease or violation of the Declaration; reimbursements to the Association for diminution of the
Association’s insurance 

  

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proceeds, to the extent not caused by Tenant’s violation of the insurance provisions of the Declaration; and assessments levied against the Premises
because of the nonpayment of assessments levied on other lots within the Project other than the Premises) shall constitute a part of Tenant’s Allocable Share of Reimbursable Operating Costs pursuant to Article 8 of this Lease. 

Following recordation of the Declaration, if owners and occupants of Building 2 or Building 3 are violating the terms and conditions of the
Declaration and such violation materially and adversely affects Tenant’s rights under this Lease, then within a reasonable time following Tenant’s request, Landlord shall take reasonable steps to enforce the provisions of the Declaration
relating to such violation, in accordance with the procedures established in the Declaration, the cost of which shall be a Reimbursable Operating Cost pursuant to Article 8 of this Lease. 
 3. USE: 
 A. Permitted Uses: Tenant
shall use the Premises only for the following purposes and shall not change the use of the Premises without the prior written consent of Landlord: General office uses including research and development and other incidental uses (such incidental uses
shall include without limitation, a gymnasium and/or a cafeteria for use of Tenant’s employees). Tenant shall use only the number of parking spaces allocated to Tenant under this Lease. Following recordation of the Declaration, if occupants of
Building 2 or Building 3 are using parking spaces in excess of the number of spaces to which they are entitled under the Declaration, then within a reasonable time following Tenant’s request, Landlord shall seek to enforce the provisions of the
Declaration relating to such excessive use, in accordance with the procedures established in the Declaration, the cost of which shall be a Reimbursable Operating Cost pursuant to Article 8 of this Lease. Prior to recording the Declaration,
Landlord shall cause the Declarants of the Declaration to confirm in writing for the benefit of Tenant that the signs and window coverings to be installed pursuant to Section 3.C of this Lease are approved by the Declarants. Landlord shall
promptly send to Tenant all notices received from the Association pertaining to the Association’s entry onto the Premises and Common Area, insurance coverage affecting the Premises, and assessments levied against the Premises. All commercial
trucks and delivery vehicles shall be (i) loaded and unloaded in a manner which does not interfere with the businesses of other occupants of the Project, and (ii) permitted to remain on the Project only so long as is reasonably necessary
to complete the loading and unloading. Landlord makes no representation or warranty that any specific use of the Premises desired by Tenant is permitted pursuant to any Laws. 
 B. Uses Prohibited: Tenant shall not commit or suffer to be committed on the Premises any waste, nuisance, or other act or thing which may
disturb the quiet enjoyment of any other tenant in or around the Premises, nor allow any sale by auction or any other use of the Premises for an unlawful purpose. Tenant shall not (i) damage or overload the electrical, mechanical or plumbing
systems of the Premises, (ii) attach, hang or suspend anything from the ceiling, walls or columns of the building or set any load on the floor in excess of the load limits for which such items are designed, or (iii) generate dust, fumes or

  

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waste products which create a fire or health hazard or damage the Premises or in the soils surrounding the Building. No materials, supplies, equipment,
finished products or semi-finished products, raw materials or articles of any nature, or any waste materials, refuse, scrap or debris, shall be stored upon or permitted to remain on any portion of the Premises outside of the Building without
Landlord’s prior approval, which approval may be withheld in its sole discretion. 
 C. Advertisements and Signs: Tenant
shall be permitted to place two (2) signs mounted on the building, one monument sign within the Common Area, and any directional signs necessary within the Common Area, provided such signs are approved by the city or other governing authority.
Tenant shall be entitled to additional signage on Building 2 and Building 3 (if leased) pursuant to the leases for these buildings. Any sign placed on the Premises shall be removed by Tenant, at its sole cost, prior to the Expiration Date or
promptly following the earlier termination of the lease, and Tenant shall repair, at its sole cost, any damage or injury to the Premises caused thereby, and if not so removed, then Landlord may have same so removed at Tenant’s expense.

 D. Covenants, Conditions and Restrictions: This Lease is subject to the effect of (i) easements, mortgages or deeds of
trust, ground leases, rights of way of record and any other matters or documents of record; and (ii) any zoning laws of the city, county and state where the Building is situated (collectively referred to herein as “Restrictions”) and
Tenant will conform to and will not violate the terms of any such Restrictions. 
 Tenant acknowledges that as to certain matters set forth
in this Lease, the Association (defined in the Declaration) has or will have rights of approval or disapproval. If any matter requiring the Association’s approval is submitted to Landlord by Tenant for Landlord’s approval, Landlord shall
respond to Tenant in a timely fashion. If Landlord approves such matter and such matter further requires the Association’s approval, Landlord shall promptly submit the same to the Association, as applicable. In no event, however, shall
Landlord’s disapproval be deemed unreasonable if the Association has disapproved of such matter nor shall Landlord have any liability to Tenant by reason thereof. 
 4. TERM AND RENTAL: 
 A. Base Monthly Rent: The term (“Lease Term”)
shall be for one hundred forty four (144) months, commencing on substantial completion of construction as finally determined pursuant to Section 5.G (the “Commencement Date”) estimated to occur on August 1, 2001, and ending
one hundred forty four (144) months thereafter, (“Expiration Date”). Notwithstanding the foregoing, Tenant shall have the right to accelerate the commencement of construction of the Building by giving notice to Landlord that Tenant
wishes Landlord to commence construction of the Building (the “Acceleration Notice”) no later than thirteen (13) months prior to the desired Commencement Date. Notwithstanding the fact that the Lease Term begins on the Commencement
Date, this Lease and all of the obligations of Landlord and Tenant shall be 

  

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binding and in full force and effect from and after the Effective Date except for those obligations which begin on the Commencement Date. In addition to all
other sums payable by Tenant under this Lease, Tenant shall pay as base monthly rent (“Base Monthly Rent”) for the Premises the amount of Three Hundred Thirty Four Thousand Three Hundred Fifty Five Dollars ($334,355.00). Base Monthly Rent
and Tenant’s payment of operating expenses and taxes pursuant to Section 8 shall be payable beginning on the Commencement Date in advance on or before the first day of each calendar month during the Lease Term. All sums payable by Tenant
under this Lease shall be paid to Landlord in lawful money of the United States of America, without offset or deduction and without prior notice or demand, at the address specified in Section 1 of this Lease or at such place or places as may be
designated in writing by Landlord during the Lease Term. Base Monthly Rent for any period less than a calendar month shall be a pro rata portion of the monthly installment. 
 B. Rental Adjustment: 
 (i) For Variation in Rentable Square Feet: Upon Substantial Completion of construction, the Building shall be measured (from outside wall to outside wall including all areas covered by a structural roof), and if the actual
square footage differs from 141,496 square feet, the initial Base Monthly Rent hereunder shall be adjusted to the product of Two and 363/1000 Dollars ($2,363) and the actual rentable square feet of the Building. 
 (ii) Periodic Adjustment: Beginning thirty (30) months after the Commencement Date, and every thirty (30) months
thereafter, the then-payable Base Monthly Rent shall be increased by seven and 50/100 percent (7.50%). 
 C. Late Charges:
Tenant hereby acknowledges that late payment by Tenant to Landlord of Base Monthly Rent and other sums due hereunder will cause Landlord to incur costs not contemplated by this Lease, the exact amount of which is extremely difficult to ascertain.
Such costs include but are not limited to: administrative, processing, accounting, and late charges which may be imposed on Landlord by the terms of any contract, revolving credit, mortgage, or trust deed covering the Premises. Accordingly, if any
installment of Base Monthly Rent or other sum due from Tenant shall not be received by Landlord or its designee within ten (10) days after the rent is due, Tenant shall pay to Landlord a late charge equal to five (5%) percent of such
overdue amount, which late charge shall be due and payable on the same date that the overdue amount was due. The parties agree that such late charge represents a fair and reasonable estimate of the costs Landlord will incur by reason of late payment
by Tenant, excluding interest and attorneys fees and costs. If any rent or other sum due from Tenant remains delinquent for a period in excess of thirty (30) days then, in addition to such late charge, Tenant shall pay to Landlord interest on
any rent that is not paid when due at the Agreed Interest Rate specified in Section 21.J following the date such amount became due until paid. Acceptance by Landlord of such late charge shall not constitute a waiver of Tenant’s default
with respect to such overdue amount nor prevent Landlord from exercising any of the other rights and remedies granted hereunder. In the event that a late charge is payable hereunder, whether or not collected, for three (3) consecutive
installments of Base Monthly 

  

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Rent, then the Base Monthly Rent shall automatically become due and payable quarterly in advance, rather than monthly, notwithstanding any provision of this
Lease to the contrary, After four (4) quarterly installments have been paid on time, rent shall again be payable monthly. 
 D.
Security Deposit: 
 (i) Amount: Pursuant to the Building 2 Lease, Tenant will deposit with Landlord a
letter of credit (“Letter of Credit”) in a form reasonably acceptable to Landlord in the amount of Eight Million Four Hundred Thousand Dollars ($8,400,000,00) to secure Tenant’s obligation to complete Tenant Improvements in the
Building and in Building 2. Upon Landlord’s receipt of evidence reasonably satisfactory to Landlord of lien free completion of the Tenant Improvements and that Tenant has fully paid for the cost of all of Tenant Improvements for the
Building and for Building 2, the Letter of Credit shall be cancelled and returned to Tenant by Landlord. Notwithstanding the foregoing, in the event Tenant elects to defer construction on a portion of the non-core Tenant Improvements in the Building
(as provided further and restricted in Section 5.B), Landlord shall not require Tenant to continue to post the Letter of Credit after payment in full for all other Tenant Improvements associated with the Building and Building 2. 
 (ii) Use by Landlord: Landlord shall be entitled to draw against the full amount of the Letter of Credit at any time
provided only that Landlord certifies to the issuer of the Letter of Credit that Tenant has failed to make a payment for Tenant Improvement costs as provided in 5.F, that Tenant has failed to timely renew or extend the Letter of Credit as required
by this subsection (ii), or that Tenant has failed to amend the Letter of Credit or obtain a new Letter of Credit as required by this subsection (ii) and such failure hat not been cured within ten (10) days following Landlord’s
notice to Tenant. Tenant shall keep the Letter of Credit in effect at all times prior to payment in full for the Tenant Improvements for the Building and for Building 2. At least sixty (60) days prior to expiration of any Letter of Credit, the
term thereof shall be renewed or extended for a period until Tenant has paid in full for the Tenant Improvements for the Building. Subject to the notice requirement and cure period provided herein, Tenant’s failure to so renew or extend the
Letter of Credit shall be a material default of this Lease by Tenant entitling Landlord to draw down on the entire amount of the Letter of Credit. Any amounts drawn on the Letter of Credit shall be used to pay for the cost of the Tenant
Improvements. In the event the Letter of Credit is drawn by Landlord, and the proceeds used to pay for the completion of the Tenant Improvements in the Building and Building 2 after Landlord’s completion of the Tenant Improvements in the
Building, Landlord shall refund to Tenant any excess proceeds from the Letter of Credit. In the event of termination of Landlord’s interest in this Lease, Landlord may deliver the Letter of Credit to Landlord’s successor in interest in the
Premises and thereupon be relieved of further responsibility with respect to the Letter of Credit. Except as provided herein, no other security deposit shall be required by Tenant. 
 (iii) Letter of Credit Fee: Landlord and Tenant agree to share equally in the fee charged to provide the Letter of Credit.
In no event, however, shall Landlord’s share of the fee exceed the sum of Forty Two Thousand Dollars ($42,000.00) per annum. 
  

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 5. CONSTRUCTION: 
 A. Building Shell Plans: The Building Shell shall be constructed in accordance with the Building Shell plans and guideline specifications prepared by Korth Sunseri Hagey (“Shell Architect”).
The design development drawings for the Building Shell are attached hereto as Exhibit “D” (“Preliminary Shell Plans and Specifications”). The Parties have generally approved the Preliminary Shell Plans; however,
Tenant reserves the right to work in a diligent manner with Landlord and his design team to refine the Preliminary Plans and Specifications to accommodate Tenant’s requirements such that this activity does not delay the issuance of the working
drawings for the Building Shell (“Shell Permit Drawings”) on schedule. The current schedule anticipates completion of the Shell Permit Drawings on May 5, 1999. Such refinements shall be limited to the following areas:
(i) structural issues relating to the support of the rooftop HVAC system and other framing for its distribution inside the Building; (ii) planning issues relating to the sizing and placement of the base building electrical system;
(iii) planning and specification issues relating to the design of the Building security systems; (iv) utility services relating to communications entrances from the street to the Building; (v) design of the main electrical service and
emergency power service to the Building; and (vi) definition of the work that will be completed as a part of the construction of the Building as it affects Tenant’s ability to access the Building during the construction of the other
Buildings in the Project. The Shell Permit Drawings (i) shall be consistent with the Preliminary Shell Plans in all material respects, and (ii) shall provide for materials to be of a quality consistent with a “Class A” office
project the where materials are not currently specified in the Preliminary Shell Plans. Landlord shall contract for the installation of the pile foundation system and shall begin this work immediately following the Effective Date. Upon completion of
the Shell Permit Drawings, Landlord shall select a general contractor (“General Contractor”) on the basis of a competitive bid of both the cost to construct the Building Shell and the fee and general conditions bid to construct the Tenant
Improvements. Thereafter, Landlord shall cause the General Contractor to complete construction of the Building Shell. The Building Shell shall include those items set forth in the attached Exhibit “E” (“Building Shell
Definition”) which scope includes the cost of the parking structures. In the event of a conflict between Exhibit “D” and Exhibit “E”, Exhibit “E” shall govern. 
 B. Tenant Improvement Plans: Tenant, at Tenant’s sole cost and expense, will hire an interior architect (“Interior
Architect”) to prepare plans and outline specifications to be attached as Exhibit “F” (“Tenant Improvement Plans and Specifications”) with respect to the construction of improvements to the interior premises
(“Tenant Improvements”). The Tenant improvement Plans and Specifications plans shall he completed for all aspects of the work by October 1, 2000, or three (3) months following the Acceleration Notice with all detail necessary for
submittal to the city and for construction and shall include any information required by the relevant agencies regarding Tenant’s use of Hazardous Materials if applicable. The Tenant Improvements shall consist of all items not included within
the scope of the Building Shell Definition. All Tenant Improvements affecting or otherwise 

  

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related to the Building Core will be subject to Landlord’s reasonable approval. The “Building Core” shall include those items typically
associated in the industry with an office building core including elevators, restrooms, fire sprinklers, HVAC and electrical systems distributed to each floor, exiting stair finishes and a finished building lobby. As to the balance of the Tenant
Improvements, Landlord shall not have rights of approval, however, Tenant Improvement Plans shall provide for the creation of finished office space ready for occupancy with a minimum buildout in all areas of the Premises consisting (i) fire
sprinklers, (ii) floor coverings, (iii) overhead ceiling system (iv) distribution of the HVAC system, (v) overhead florescent lighting, and (vi) any other work required by the City of San Mateo necessary to obtain a
Certificate of Occupancy. Tenant shall have the right to defer installation of the Tenant Improvements not associated with the Building Core in up to twenty percent (20%) of the rentable square footage of the Building. Except as provided in the
preceding sentence, Tenant shall have no rights or ability to delay installation of any of the Tenant Improvements. The Tenant Improvement Plans and Specifications shall be prepared in sufficient detail to allow General Contractor to construct the
Tenant Improvements. The General Contractor shall construct the Tenant Improvements in accordance with all Tenant Improvement Plans and Specifications. The Tenant Improvements shall not be removed or altered by Tenant without the prior written
consent of Landlord as provided in Section 7. Tenant shall have the right to depreciate and claim and collect any investment tax credits in the Tenant Improvements during the Lease Term, Tenant shall further retain the right to encumber its
leasehold interest with a first priority security interest, provided such lienholder has no right to remove any Tenant Improvements installed by Tenant pursuant to this Lease in the event of a default by Tenant under such encumbrance. Upon
expiration of the Lease Term or any earlier termination of the Lease, the Tenant Improvements shall become the property of Landlord and shall remain upon and be surrendered with the Premises, and title thereto shall automatically vest in Landlord
without any payment therefore. 
 C. Tenant Improvement Pricing. Within ten (10) days after completion of the Tenant
Improvements Plans and Specifications, Landlord shall cause the General Contractor to submit to Tenant competitive bids from at least three (3) subcontractors for each aspect of the work in excess of Fifty Thousand and No/ 100 Dollars
($50,000.00) related to the Tenant Improvements. Landlord shall cause the General Contractor to utilize the low bid in each case unless Tenant approves General Contractor’s use of another subcontractor, and the cost of the Tenant Improvements
shall be based upon construction expenses equal to (i) the bid amounts as approved by Tenant, (ii) a reasonable contingency approved by Tenant to protect the General Contractor against cost overruns, and (iii) the general contractor
fee specified in Section 5.H below (“Tenant Improvement Budget”). Upon Tenant’s written approval of the Tenant Improvement Budget, which approval shall not be unreasonably withheld or delayed, Landlord and Tenant shall be deemed
to have given their respective approvals of the final Tenant Improvement Plans and Specifications on which the cost estimate was made, and General Contractor shall proceed with the construction of the Tenant Improvements in accordance with the terms
of Section 5.G 

  

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below. If Tenant does not specifically approve or disapprove the bids within ten (10) business days, Tenant shall be deemed to have approved the bids.

 D. Change Orders: Tenant shall have the right to order changes in the manner and type of construction of the Tenant
Improvements. Upon request and prior to Tenant’s submitting any binding change order, Landlord shall cause the General Contractor to promptly provide Tenant with written statements of the cost to implement and the time delay and increased
construction costs associated with any proposed change order, which statements shall be binding on General Contractor. If no time delay or increased construction cost amount is noted on the written statement, the parties agree that there shall be no
adjustment to the construction cost or the Commencement Date associated with such change order. If ordered by Tenant, Landlord shall cause the General Contractor to implement such change order and the cost of constructing the Tenant Improvements
shall be increased or decreased in accordance with the cost statement previously delivered by General Contractor to Tenant for any such change order. In no event, however, shall Tenant have the right to eliminate the minimum buildout requirements
specified in Section 5.B above. 
 E. Building Shell Costs: Landlord shall pay all costs associated with the Building
Shell. 
 F. Tenant Improvement Costs: Tenant shall pay all costs associated with the Tenant Improvements. The cost of Tenant
Improvements shall consist of only the following to the extent actually incurred by General Contractor in connection with the construction of Tenant Improvements: construction costs, all permit fees, construction taxes or other costs imposed by
governmental authorities related to the Tenant Improvements, and General Contractor overhead and profit as described in Section 5.H below. During the course of construction of Tenant Improvements, Landlord may deliver to Tenant not more than
once each calendar month a written request for payment prepared by the General Contractor (“Progress Invoice”) which shall include and be accompanied by General Contractor’s certified statements setting forth the amount requested,
certifying the percentage of completion of each item for which reimbursement is requested, and if requested by Tenant, a certificate from Landlord’s Architect certifying the percentage completion. Tenant shall pay the amount due pursuant to the
Progress Invoice less a ten percent (10%) retention directly to the General Contractor, within thirty (30) days after Tenant’s receipt of the above items. All costs for Tenant Improvements shall be fully documented to and verified by
Tenant. 
 G. Construction: The Building Shell and Tenant Improvements shall be deemed substantially complete
(“Substantially Complete” or “Substantial Completion”) when the Building Shell and Tenant Improvements have been substantially completed in accordance with the Shell Plans and Specifications and Tenant Improvement Plans and
Specifications, as evidenced by the completion of a final inspection or the issuance of a certificate of occupancy or its equivalent by the appropriate governmental authority for the Building Shell and Tenant Improvements, and the issuance of a
certificate by the Architect certifying that the Building Shell and Tenant improvements have been completed in accordance with the plans. 

  

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Installation of (i) Tenant’s data and phone cabling, Tenant’s furniture, or (iii) the exterior landscaping shall not be required in order
to deem the Premises Substantially Complete. Any prevention, delay or stoppage due to strikes, lockouts, inclement weather unusual for the season it which it occurs, labor disputes, inability to obtain labor, materials, fuel or reasonable
substitutes therefor, governmental restrictions, regulations, controls, civil commotion, fire or other act of God, and another causes beyond the reasonable control of Landlord (except financial inability) shall extend the dates contained in this
Section 5.G by a period equal to the period of any said prevention, delay or stoppage. 
 If Landlord cannot obtain building permits or
Substantially Complete construction by the dates set forth herein, this Lease shall not be void or voidable nor shall Landlord be liable for any loss or damage resulting therefrom. Notwithstanding anything to the contrary contained herein, if
Landlord has not delivered the Premises substantially completed to Tenant on or before August 1, 2002 (“Termination Date”), Tenant shall have the right to cancel this Lease by providing Landlord written notice within sixty
(60) days following the Termination Date as Tenant’s sole and exclusive remedy for such failure. In such event, Landlord shall return the Letter of Credit to Tenant and thereafter neither party shall have any further liability to the other
under this Lease. 
 H. General Contractor Overhead & Profit: As compensation to General Contractor for its services
related to construction of the Building Shell and Tenant Improvements, General Contractor shall receive a fee based upon the cost of construction determined and agreed upon by Landlord and Tenant at the time of the competitive bid of the Building
Shell. Except as provided therein, Landlord or General Contractor shall not receive any other fee or payment from Tenant in connection with General Contractor’s services. 
 I. Tenant Delays: A “Tenant Delay” shall mean any delay in Substantial Completion of the Building as a result of any of the
following: (i) Tenant’s failure to complete or approve the Tenant Improvement Plans by the dates set forth in Section 5.B, (ii) Tenant’s failure to approve the bids for construction by the dates set forth in
Section 5.C, (iii) changes to the plans requested by Tenant which delay the progress of the work, (iv) Tenant’s request for materials components, or finishes which are not available in a commercially reasonable time given the
anticipated Commencement Date, (v) Tenant’s failure to make a progress payment for Tenant improvements as provided in Section 5.F after notice from Landlord and expiration of the applicable cure period, (vi) Tenant’s request
for more than one (1) rebidding of the cost of all or a portion of the work, and (vii) any errors or omissions in the Tenant Improvement Plans provided by Tenant’s architect unless caused by misinformation provided by Landlord,
Landlord’s Architect or the General Contractor. Notwithstanding anything to the contrary set forth in this Lease, and regardless of the actual date the Premises are Substantially Complete, the Commencement Date shall be deemed to be the date
the Commencement Date would have occurred if no Tenant Delay had occurred as reasonable determined by Landlord. In addition, if a Tenant Delay results in an increase in the cost of the labor or materials, Tenant shall pay the cost of such increases.

  

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 J. Insurance: General Contractor shall procure (as a cost of the Building Shell) a
“Broad Form” liability insurance policy in the amount of Three Million Dollars ($3,000,000,00). Landlord shall also procure (as a cost of the Building Shell) builder’s risk insurance for the full replacement cost of the Building Shell
and Tenant Improvements while the Building and Tenant Improvements are under construction, up until the date that the fire insurance policy described in Section 9 is in full force and effect. 
 K. Punch List & Warranty: After the Building Shell and Tenant Improvements are Substantially Complete, Landlord shall cause the
General Contractor to immediately correct any construction defect or other “punch list” item which Tenant brings to General Contractor’s attention. All such work shall be performed so as to reasonably minimize the interruption to
Tenant and its activities on the Premises. General Contractor shall provide a standard contractor’s warranty with respect to the Building Shell and the Tenant Improvements for one (1) year from the Commencement Date. Such warranty shall
exclude routine maintenance, damage caused by Tenant’s negligence or misuse, and acts of God. Notwithstanding anything to the contrary in this Lease, Landlord warrants that on the commencement of the term hereof, (i) the Premises shall
comply with all laws, codes, ordinances and other governmental requirements then applicable to the Building Shell and the Common Area, (ii) all components of the Building Shell shall be in good working order, condition, and repair, and
(iii) the Premises, the Project, and the land and groundwater thereunder, shall be free of contamination by any Hazardous Materials then regulated by any applicable local, state, or federal law not caused by Tenant. In the event of any breach
of any of the foregoing warranties, Landlord shall promptly rectify the same at its sole cost and expense and shall indemnify, defend, and hold Tenant harmless from and against any damages, liability, suits, losses, claims, actions, costs or
expenses (including attorneys’ and consultants’ fees and costs) suffered by Tenant in connection with any such breach. 
 L.
Other Work by Tenant: All work not described in the Shell Plans and Specifications or Tenant Improvement Plans and Specifications, such as furniture, telephone equipment, telephone wiring and office equipment work, shall be furnished and
installed by Tenant at Tenant’s cost. Prior to Substantial Completion, Tenant shall be obligated to (i) provide active phone lines to any elevators, and (ii) contract with a firm to monitor the fire system. When the construction of
the Tenant Improvements has proceeded to the point where Tenant’s work of installing its fixtures and equipment in the Premises can be commenced, General Contractor shall notify Tenant and shall permit Tenant and its authorized representatives
and contractors access to the Premises before the Commencement Date for the purpose of installing Tenant’s trade fixtures and equipment. 
 6.
ACCEPTANCE OF POSSESSION AND COVENANTS TO SURRENDER: 
 A. Delivery and Acceptance: On the Commencement Date, Landlord
shall deliver and Tenant shall accept possession of the Premises and enter into occupancy of the 

  

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Premises on the Commencement Date. Except as otherwise specifically provided herein, Tenant agrees to accept possession of the Premises in its then existing
condition, subject to all Restrictions and without representation or warranty by Landlord except as provided in Section 5.K above. Tenant’s taking possession of any part of the Premises shall be deemed to be an acceptance of any work of
improvement done by Landlord in such part as complete and in accordance with the terms of this Lease except for (i) “Punch List” type items of which Tenant has given Landlord written notice prior to the time Tenant takes possession,
and (ii) Landlord’s warranties provided in Section 5.K above Within thirty (30) days after the Commencement Date, Tenant agrees to occupy at least a one (1) floor of the Premises. 
 B. Condition Upon Surrender: Tenant further agrees on the Expiration Date or on the sooner termination of this Lease, to surrender the
Premises to Landlord in good condition and repair, normal wear and tear excepted. In this regard, “normal wear and tear” shall be construed to mean wear and tear caused to the Premises by the natural aging process which occurs in spite of
prudent application of the commercially reasonable standards for maintenance, repair replacement, and janitorial practices, and does not include items of neglected or deferred maintenance. In any event, Tenant shall cause the following to be done
prior to the Expiration Date or sooner termination of this Lease: (i) all interior walls shall be free of holes and gouges, (ii) all tiled floors shall be cleaned and waxed, (iii) all carpets shall be cleaned and shampooed,
(iv) all broken, marred, stained or nonconforming acoustical ceiling tiles shall be replaced, (v) all cabling placed above the ceiling by Tenant or Tenant’s contractors shall be removed, (vi) all windows shall be washed;
(vii) the HVAC system shall be serviced by a reputable and licensed service firm and left in “good operating condition and repair’. as so certified by such firm, (viii) the plumbing and electrical systems and lighting shall be
placed in good order and repair (including replacement of any burned out, discolored or broken light bulbs, ballasts, or lenses. On or before the Expiration Date or sooner termination of this Lease, Tenant shall remove all its personal property and
trade fixtures from the Premises. All property and fixtures not so removed shall be deemed as abandoned by Tenant. Tenant shall ascertain from Landlord within ninety (90) days before the Expiration Date whether Landlord desires to have the
Premises or any parts thereof restored to their condition as of the Commencement Date, or to cause Tenant to surrender all Alterations (as defined in Section 7) in place to Landlord. If Landlord shall so desire, and provided that at the time
Landlord gave its consent to their installation, Landlord also notified Tenant that such removal would be required, Tenant shall, at Tenant’s sole cost and expense, remove such Alterations as Landlord requires and shall repair and restore said
Premises or such parts thereof before the Expiration Date. Such repair and restoration shall include causing the Premises to be brought into compliance with all applicable building codes and laws in effect at the time of the removal to the extent
such compliance is necessitated by the repair and restoration work. In no event, however, shall Tenant be required to remove any portion of the initial Tenant Improvements installed in accordance with the terms of this Lease. 
  

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 C. Failure to Surrender: If the Premises are not surrendered at the Expiration Date or
sooner termination of this Lease, Tenant shall be deemed in a holdover tenancy pursuant to this Section 6.C and Tenant shall indemnify, defend, and hold Landlord harmless against loss or liability resulting from delay by Tenant in so
surrendering the Premises including, without limitation, any claims made by any succeeding tenant founded on such delay and costs incurred by Landlord in returning the Premises to the required condition, plus interest at the Agreed interest Rate.
Any holding over after the let Termination or Expiration Date with Landlord’s express written consent, shall he construed as month-to-month tenancy, terminable on thirty (30) days written notice from either party, and Tenant shall pay as
Base Monthly Rent to Landlord a rate equal to one hundred twenty five percent (125%) of the Base Monthly Rent due in the month preceding the termination or Expiration Date, plus all other amounts payable by Tenant under this Lease. Any holding
over shall otherwise be on the terms and conditions herein specified, except those provisions relating to the Lease Term and any options to extend or renew, which provisions shall be of no further force and effect following the expiration of the
applicable exercise period. If Tenant remains in possession of the Premises after expiration or earlier termination of this Lease without Landlord’s consent, Tenant’s continued possession shall be on the basis of a tenancy at sufferance
and Tenant shall pay as rent during the holdover period an amount equal to one hundred fifty percent (150%) of the Base Monthly Rent due in the month preceding the termination or Expiration Date, plus all other amounts payable by Tenant under
this Lease. This provision shall survive the termination or expiration of the Lease. 
 7. ALTERATIONS AND ADDITIONS: 
 A. Tenant’s Alterations: Tenant shall not make, or suffer to be made, any alteration or addition to the Premises
(“Alterations”), or any part thereof, without obtaining Landlord’s prior written consent and delivering to Landlord the proposed architectural and structural plans for all such Alterations at least fifteen (15) days prior to the
start of construction. If such Alterations affect the structure of the Building, Tenant additionally agrees to reimburse Landlord its reasonable out-of-pocket costs incurred in reviewing Tenant’s plans. Notwithstanding anything to the contrary
contained in this lease, Tenant shall be entitled to construct Alterations which cost Tenant less than One Hundred Thousand Dollars ($100,000,00) in the aggregate each year, without obtaining Landlord’s consent, provided such Alterations do not
affect the exterior of the Premises or adversely affect the structural integrity or life safety systems of the Premises. Tenant shall not proceed to make such Alterations until Tenant has obtained all required governmental approvals and permits, and
provides Landlord reasonable security, in form reasonably approved by Landlord, to protect Landlord against mechanics lien claims. Tenant agrees to provide Landlord (i) written notice of the anticipated and actual start-date of the work,
(ii) a complete set of half-size (15” X 21”) vellum as-built drawings, and (iii) a certificate of occupancy for the work upon completion of the Alterations if required by applicable law. All Alterations shall be constructed in
compliance with all applicable building codes and laws including, without limitation, the Americans with Disabilities Act of 1990. Upon the Expiration Date, all Alterations, except movable furniture and trade fixtures, shall 

  

 -13- 

 
become a part of the realty and belong to Landlord but shall nevertheless be subject to removal by Tenant as provided in Section 6 above. Alterations
which are not deemed as trade fixtures include heating, lighting, electrical systems, air conditioning, walls, carpeting, or any other installation which has become an integral part of the Premises. All Alterations shall be maintained, replaced or
repaired by Tenant at its sole cost and expense. 
 B. Free From Liens: Tenant shall keep the Premises free from all liens
arising out of work performed, materials furnished, or obligations incurred by Tenant or claimed to have been performed for Tenant. In the event Tenant fails to discharge any such lien within fifteen (15) days after receiving notice of the
filing, Landlord shall be entitled to discharge the lien at Tenant’s expense and all resulting reasonable costs incurred by Landlord, including reasonable attorney’s fees shall be due from Tenant as additional rent. 
 C. Compliance With Governmental Regulations: The term Laws or Governmental Regulations shall include all federal, state, county, city or
governmental agency laws, statutes, ordinances, standards, rules, requirements, or orders now in force or hereafter enacted, promulgated, or issued. The term also includes government measures regulating or enforcing public access, traffic
mitigation, occupational, health, or safety standards for employers, employees, landlords, or tenants. Tenant, at Tenant’s sole expense shall make all repairs, replacements, alterations, or improvements needed to comply with all Governmental
Regulations except as otherwise expressly provided in this Lease. The judgment of any court of competent jurisdiction or the admission of Tenant in any action or proceeding against Tenant (whether Landlord be a party thereto or not) that Tenant has
violated any such law, regulation or other requirement in its use of the Premises shall be conclusive of that fact as between Landlord and Tenant. 
 8.
MAINTENANCE OF PREMISES: 
 A. Landlord’s Obligations: Landlord at its sole cost and expense, shall maintain in good
condition, order, and repair, and replace as and when necessary, the foundation, exterior load bearing walls glass curtainwall, and roof structure of the Building Shell. Landlord further agrees to perform repairs and replacements to the Common Area
to maintain the Common Area in good condition, order and repair (subject to Tenant’s reimbursement obligation). Tenant acknowledges and agrees that the Association formed pursuant to the Declaration may perform the maintenance, repair and
restoration obligations of Landlord under this Section 8A and other sections of this Lease on behalf of Landlord and other owners of any portion of the Project, in discharge of Landlord’s maintenance, repair and restoration obligations
under this Lease. As to increases in annual assessments or the imposition of a special assessment under the Declaration which would require the vote of the Owners (as defined in the Declaration), Landlord agrees to vote in favor or such assessments
to the extent Landlord reasonably determines such sums are required to maintain the Premises in the condition required by this Lease. Notwithstanding the foregoing, in the event that Tenant leases from Landlord all of the space then developed within
the Project, Tenant shall have the right to perform the repairs, replacements and maintenance of the Common Area and pay such costs directly. 
  

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 B. Tenant’s Obligations: Subject to Sections 15 and 16, Tenant shall clean, maintain,
repair and replace when necessary the Building and every part thereof through regular inspections and servicing, including but not limited to: (1) all plumbing and sewage facilities, (ii) all heating ventilating and air conditioning
facilities and equipment, (iii) all fixtures, interior walls floors, carpets and ceilings, (iv) all electrical facilities and equipment, (v) all automatic fire extinguisher equipment, (vi) all elevator equipment, and
(vii) the roof membrane system. All wall surfaces and floor tile are to be maintained in an as good a condition as when Tenant took possession free of holes, gouges, or defacements. With respect to items (ii), (vi) and (vii) above,
Tenant shall provide Landlord a copy of a service contract between Tenant and a licensed service contractor providing for periodic maintenance of all such systems or equipment in conformance with the manufacturer’s recommendations. Tenant shall
provide Landlord upon request, a copy of such preventive maintenance contracts and paid invoices for the recommended work if requested by Landlord. 
 C. Landlord and Tenant’s Obligations Regarding Reimbursable Operating Costs: Notwithstanding the provisions of Sections 8, 9, 10 and 11 of this Lease, Tenant agrees to reimburse Landlord for Tenant’s Allocable
Share (as defined in Section 8.E below) of the expenses resulting from Landlord’s payment of Reimbursable Operating Costs (as defined in Section 8.D below) in connection with the Premises or in connection with the Project which are
not otherwise Landlord’s obligation hereunder. Tenant agrees to pay its Allocable Share at the Reimbursable Operating Costs as additional rental within ten (10) business days of written invoice front Landlord. 
 D. Reimbursable Operating Costs: For purposes of calculating Tenant’s Allocable Share of Building and Project Costs, the term
“Reimbursable Operating Costs” is defined as all reasonable costs and expenses of the nature hereinafter described which are incurred by Landlord in connection with ownership and operation of the Building or the Project in which the
Premises are located. All costs and expenses shall be determined in accordance with generally accepted accounting principles which shall be consistently applied, including but not limited to the following: (i) common area utilities, including
water, power, telephone, heating, lighting, air conditioning, ventilating, and Building utilities to the extent not separately metered; (ii) common area maintenance and service agreements for the Building and/or Project and the equipment
therein, including without limitation, common area janitorial services, alarm and security services, exterior window cleaning, and maintenance of the sidewalks, landscaping, waterscape, roof membrane, parking garages and parking areas, driveways,
service areas, mechanical rooms, elevators, and the building exterior; (iii) insurance premiums and costs, including without limitation, the premiums and cost of fire, casualty and liability coverage and rental abatement and earthquake (if
available at commercially reasonable rates) insurance applicable to the Building or Project; (iv) repairs, replacements and general maintenance (excluding repairs and general maintenance paid by proceeds of insurance or 

  

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by Tenant or other third parties, and repairs or alterations attributable solely to tenants of the Building or Project other than Tenant); and (v) all
real estate taxes and assessment installments or other impositions or charges which may be levied on the Building or Project, upon the occupancy of the Building or Project and including any substitute or additional charges which may be imposed
during, or applicable to the Lease Term including real estate tax increases due to a sale, transfer or other change of ownership of the Building or Project, as such taxes are levied or appear on the City and County tax bills and assessment rolls.
Landlord shall have no obligation to provide guard services or other security measures for the benefit of the Project. Tenant assumes all responsibility for the protection of Tenant and Tenant’s Agents from acts of third parties; provided,
however, that nothing contained herein shall prevent Landlord, at its sole option, from providing security measures for the Project. This is a “Net” Lease, meaning that Base Monthly Rent is paid to Landlord net of all costs and expenses,
except as provided otherwise in this Lease. The provision for payment of Reimbursable Operating Costs by means of periodic payment of Tenant’s Allocable Share of Building and/or Project Costs is intended to pass on to Tenant and reimburse
Landlord for all costs of operating and managing the Building and/or Project. 
 E. Tenant’s Allocable Share: For purposes
of prorating Reimbursable Operating Costs which Tenant shall pay, Tenant’s Allocable Share of Reimbursable Operating Costs shall be computed by multiplying the Reimbursable Operating Costs by a fraction, the numerator of which is the rentable
square footage of the Premises and the denominator of which is either the total rentable square footage of the Building if the service or cost is allocable only to the Building, or the total square footage of the buildings completed within the
Project if the service or cost is allocable to the entire Project. Tenant’s obligation to share in Reimbursable Operating Costs shall be adjusted to reflect the Lease Commencement and Expiration dates and is subject to recalculation in the
event of expansion of the Building or Project. 
 F. Exclusions to Reimbursable Operating Costs: Notwithstanding anything to
the contrary contained in this Lease, the following costs and expenses shall not be included within Reimbursable Operating Costs: (i) Leasing commissions, attorneys’ fees, costs, disbursements, and other expenses incurred in connection
with negotiations or disputes with tenants, or in connection with leasing, renovating, or improving space for tenants or other occupants or prospective tenants or other occupants of the Project; (ii) The cost of any service sold to any tenant
(including Tenant) or other occupant for which Landlord is entitled lo be reimbursed as an additional charge or rental over and above the basic rent and escalations payable under the lease with that tenant; (iii) Any depreciation on the
Project; (iv) Expenses in connection with services or other benefits of a type that are not provided to Tenant but which are provided another tenant or occupant of the Project; (v) Costs incurred due to Landlord’s violation of any
terms or conditions of the Declaration, this Lease or any other lease relating to the Project; (vi) Overhead profit increments paid to Landlord’s subsidiaries or affiliates for services on or to the building or for supplies or other
materials to the extent that the cost of the services, supplies, or materials exceeds the cost that would have been paid had the 

  

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services, supplies, or materials been provided by unaffiliated parties on a competitive basis; (vii) All interest, loan fees, and other carrying costs
related to any mortgage or deed of trust or related to any capital item, and all rental and other payable due under any ground or underlying lease, or any lease for any equipment ordinarily considered to be of a capital nature (except janitorial
equipment which is not affixed to the Project.); (viii) Any compensation paid to clerks, attendants, or other persons in commercial concessions operated by Landlord; (ix) Advertising and promotional expenditures; (x) Costs of repairs
and other work occasioned by fire, windstorm, or other casualty of a nature required to be insured against under this Lease in excess of the deductible; (xi) Arty costs, fines, or penalties incurred due to violations by Landlord of any
governmental rule or authority, this Lease or any other lease in the Project, or due to Landlord’s negligence or willful misconduct; (xii) Property management fees; (xiii) Costs for sculpture, paintings, or other objects of art (and
insurance thereon or extraordinary security in connection therewith); (xiv) The cost of correcting any building code or other violations which were violations prior to the Commencement Date of this Lease; (xv) The cost of containing,
removing, or otherwise remediating any contamination of the Project (including the underlying land and ground water) by any Hazardous Materials where such contamination was not caused by Tenant. 
 G. Waiver of Liability: Failure by Landlord to perform any defined services, or any cessation thereof, when such failure is caused by
accident, breakage, repairs, strikes, lockout or other labor disturbances or labor disputes of any character or by any other cause, similar or dissimilar, shall not render Landlord liable to Tenant in any respect, including damages to either person
or property, nor he construed as an eviction of Tenant, nor cause an abatement of rent, nor relieve Tenant from fulfillment of any covenant or agreement hereof. Should any equipment or machinery utilized in supplying the services listed herein break
down or for any cause cease to function properly, upon receipt of written notice from Tenant of any deficiency or failure of any services, Landlord shall use reasonable diligence to repair the same promptly, but Tenant shall have no right to
terminate this Lease and shall have no claim for rebate of rent or damages on account of any interruptions in service occasioned thereby or resulting therefrom. Tenant waives the provisions of California Civil Code Sections 1941 and 1942 concerning
the Landlord’s obligation of tenantability and Tenant’s right to make repairs and deduct the cost of such repairs from the rent. Landlord shall not be liable for a loss of or injury to person or property, however occurring, through or in
connection with or incidental to furnishing, or its failure to furnish, any of the foregoing unless causes by its gross negligence or willful misconduct. 
 H. Tenant’s Right to Audit: Tenant shall have the right to audit at Landlord’s local offices, at Tenant’s expense, Landlord’s accounts and records relating to Reimbursable Operating
Costs. Such audit shall be conducted by a certified public accountant approved by Landlord, which approval shall not be unreasonably withheld. If such audit reveals that Landlord has overcharged Tenant, the amount overcharged shall be paid to Tenant
within 30 days after the audit is concluded, together with interest thereon at the rate of ten percent (10.0%) per annum, from the date paid by Tenant until payment of 

  

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the overcharge is made to Tenant. In addition, if the amount paid by Tenant exceeds the Reimbursable Operating Costs which should have been charged to Tenant
by more than five percent (5.0%), the cost of the audit shall be paid by Landlord, 
 9. HAZARD INSURANCE: 
 A. Tenant’s Use: Tenant shall not use or permit the Premises, or any part thereof, to be used for any purpose other than that for which
the Premises are hereby leased; and no use of the Premises shall be made or permitted, nor acts done, which will cause an increase in premiums or a cancellation of any insurance policy covering the Project or any part thereof, nor shall Tenant sell
or permit to be sold, kept, or used in or about the Premises, any article prohibited by the standard form of fire insurance policies Tenant shall, at its sole cost, comply with all requirements of any insurance company or organization necessary for
the maintenance of reasonable fire and public liability insurance covering the Premises and appurtenances. 
 B. Landlord’s
Insurance: Landlord agrees to purchase and keep in force fire, extended coverage insurance in an amount equal to the replacement cost of the Building as determined by Landlord’s insurance company’s appraisers. If required by the holder
of the first deed of trust on the property, such fire and property damage insurance may be endorsed to cover loss caused by such additional perils against which Landlord may elect to insure, including earthquake and/or flood, and shall contain
reasonable deductibles which, in the case of earthquake and flood insurance may be up to 15% of the replacement value of the property. Additionally Landlord may maintain a policy of (i) commercial general liability insurance insuring Landlord
(and such others designated by Landlord) against liability for personal injury, bodily injury, death and damage to property occurring or resulting from an occurrence in, on or about the Premises or Project in an amount as Landlord determines is
reasonably necessary for its protection, and (ii) rental lost insurance covering a twelve (12) month period. Tenant agrees to pay Landlord as additional rent, on demand, the full cost of said insurance and any insurance costs allocable to
the Building pursuant to the Declaration as evidenced by insurance billings to Landlord, and in the event of damage covered by said insurance, the amount of any commercially reasonable deductible under such policy. Payment shall be due to Landlord
within thirty (30) days after written invoice to Tenant. It is understood and agreed that Tenant’s obligation under this Section will be prorated to reflect the Lease Commencement and Expiration Dates. Tenant acknowledges and agrees that
the Association formed pursuant to the Declaration may procure all or arty portion of the insurance required to be maintained by Landlord under this Lease on behalf of Landlord and in discharge of Landlord’s obligation to procure such insurance
under this Lease, under one or more policies procured by the Association from time to time for the benefit of Landlord and other owners of any portion of the Project, the cost of which shall be paid by Tenant pursuant to this section 9.B,
provided that the cost to Tenant shall not be greater than that which Tenant would have had to pay if Landlord obtained such coverage directly. 
  

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 C. Tenant’s Insurance: Tenant agrees, at its sole cost, to insure its personal
property, Tenant Improvements and Alterations for their full replacement value (without depreciation) and to obtain worker’s compensation and public liability and property damage insurance for occurrences within the Premises with a combined
single limit of not less than Five Million Dollars ($5,000,000.00). Tenant’s liability insurance shall he primary insurance containing a cross-liability endorsement, and shall provide coverage on an “occurrence” rather than on a
“claims made” basis. Tenant shall name Master Landlord, Landlord and their respective lenders as an additional insured and shall deliver evidence of insurance and renewal certificates to Landlord. All such policies shall provide for thirty
(30) days’ prior written notice to Landlord of any cancellation, termination, or reduction in coverage. 
 D. Waiver:
Landlord and Tenant hereby waive all rights each may have against the other on account of any loss or damage sustained by Landlord or Tenant, as the case may be, or to the Premises or its contents, which may arise from any risk covered by their
respective insurance policies (or which would have been covered had such insurance policies been maintained in accordance with this Lease) as set forth above. The parties shall use their reasonable efforts to obtain from their respective insurance
companies a waiver of any right of subrogation which said insurance company may have against Landlord, Master Landlord ox Tenant, as the case may be. 
 10. TAXES: Tenant shall be liable for and shall pay as additional rental, prior to delinquency, the following: (i) all taxes and assessments levied against Tenant’s personal property and trade or business fixtures;
(ii) all real estate taxes and assessment installments or other impositions or charges which may be levied on the Premises or upon the occupancy of the Premises, including any substitute or additional charges which may be imposed applicable to
the Lease Term; and (iii) real estate tax increases due to an increase in assessed value resulting from a sale, transfer or other change of ownership of the Premises as it appears on the City and County tax bills during the Lease Term.
Tenant’s obligation under this Section shall be prorated to reflect the Lease Commencement and Expiration Dates. If, at any time during the Lease Term a tax, excise on rents, business license tax or any other tax, however described, is levied
or assessed against Landlord as a substitute or addition, in whole or in part, for taxes assessed or imposed on land or Buildings, Tenant shall pay and discharge its pro rata share of such tax or excise on rents or other tax before it becomes
delinquent; except that this provision is not intended to cover net income taxes, inheritance, gift or estate tax imposed upon Landlord. In the event that a tax is placed, levied, or assessed against Landlord and the taxing authority takes the
position that Tenant cannot pay and discharge its pro rata share of such tax on behalf of Landlord, then at Landlord’s sole election, Landlord may increase the Base Monthly Rent by the exact amount of such tax and Tenant shall pay such
increase. If by virtue of any application or proceeding brought by or on behalf of Landlord, there results a reduction in the assessed value of the Premises during the Lease Term, Tenant agrees to reimburse Landlord for all costs incurred by
Landlord in connection with such application or proceeding, not to exceed the amount of any savings realized by Tenant. In the event the Project is not subdivided as provided in Section 2.C and the tax bill covers the entire Project, the real
estate taxes and assessments shall be prorated as provided in Section 8.E. 
  

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 11. UTILITIES: Tenant shall pay directly to the providing utility all water, gas, electric, telephone, and
other utilities supplied to the Premises. Landlord shall not be liable for loss of or injury to person or property, however occurring, through or in connection with or incidental to furnishing or the utility company’s failure to furnish
utilities to the Premises unless caused by Landlord’s gross negligence of willful misconduct, and Tenant shall not be entitled to abatement or reduction of any portion of Base Monthly Rent or any other amount payable under this Lease.

 12. TOXIC WASTE AND ENVIRONMENTAL DAMAGE: 
 A. Tenant’s Responsibility: Without the prior written consent of Landlord, Tenant shall not bring, use, or permit upon the Premises, or generate, create, release, emit, or dispose (nor permit any of
the same) from the Premises any chemicals, toxic or hazardous gaseous, liquid or solid materials or waste, including without limitation, material or substance having characteristics of ignitability, corrosivity, reactivity, or toxicity or substances
or materials which are listed on any of the Environmental Protection Agency’s lists of hazardous wastes or which arc identified in Division 22 Title 26 of the California Code of Regulations as the same may be amended from time to time or any
wastes, materials or substances which are or may become regulated by or wider the authority of any applicable local, state or federal laws, judgments, ordinances, orders, rules, regulations, codes or other governmental restrictions, guidelines or
requirements (“Hazardous Materials”) except for those substances customary in typical office uses for which no consent shall be required. In order to obtain consent, Tenant shall deliver to Landlord its written proposal describing the
toxic material to be brought onto the Premises, measures to be taken for storage and disposal thereof, safety measures to be employed to prevent pollution of the air, ground, surface and ground water. Landlord’s approval may be withheld in its
reasonable judgment. In the event Landlord consents to Tenant’s use of Hazardous Materials on the Premises or such consent is not required, Tenant represents and warrants that it shall comply with all Governmental Regulations applicable to
Hazardous Materials including doing the following: (i) adhere to all reporting and inspection requirements imposed by Federal, State, County or Municipal laws, ordinances or regulations and will provide Landlord a copy of any such reports or
agency inspections; (ii) obtain and provide Landlord copies of all necessary permits required for the use, and handling of Hazardous Materials on the Premises; (iii) enforce Hazardous Materials handling and disposal practices consistent
with industry standards; (iv) surrender the Premises free from any Hazardous Materials arising from Tenant’s bringing, using, permitting, generating, creating, releasing, emitting or disposing of Hazardous Materials; and (v) properly
close the facility with regard to hazardous Materials including the removal or decontamination of any process piping, mechanical ducting, storage tanks, containers, or trenches which have come into contact with Hazardous Materials and obtain a
closure certificate from the local administering agency prior to the Expiration Date. 
  

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 B. Tenant’s Indemnity Regarding Hazardous Materials: Tenant shall, at its sole cost
and expertise, comply with all laws pertaining to, and shall with counsel reasonably acceptable to Landlord, indemnify, defend and hold harmless Landlord, Master Landlord and their trustees, shareholders, directors, officers, employees, partners,
affiliates, and agents from, any claims, liabilities, costs or expenses incurred or suffered by Landlord arising from the bringing, using, permitting, generating, emitting or disposing of Hazardous Materials by Tenant or a third party through the
surface soils of the Premises during the Lease Term or the violation of any Governmental Regulation or environmental law, by Tenant or Tenant’s Agents. Tenant’s indemnification and hold harmless obligations include, without limitation, the
following arising from the bringing, using, permitting, generating, emitting or disposing of Hazardous Materials by Tenant or a third party through the surface soils of the Premises during the Lease Term or the violation of any Governmental
Regulation or environmental law, by Tenant or Tenant’s Agents.; (1) claims, liability, costs or expenses resulting from or based upon administrative, judicial (civil or criminal) or other action, legal or equitable, brought by any private
or public person under common law or under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), the Resource Conservation and Recovery Act of 1980 (“RCRA”) or any other Federal, State,
County or Municipal law, ordinance or regulation; (ii) claims, liabilities, costs or expenses pertaining to the identification, monitoring, cleanup, containment, or removal of Hazardous Materials from soils, riverbeds or aquifers including the
provision of an alternative public drinking water source; (iii) all costs of defending such claims; (iv) losses attributable to diminution in the value of the Premises or the Building; (v) loss or restriction of use of rentable space
in the Building; (vi) Adverse effect on the marketing of any space in the Building; and (vi) all other liabilities, obligations, penalties, fines, claims, actions (including remedial or enforcement actions of any kind and administrative or
judicial proceedings, orders or judgments), damages (including consequential and punitive damages), and costs (including attorney, consultant, and expert fees and expenses) resulting front the release or violation. This indemnification shall survive
the expiration or termination of this Lease. 
 C. Landlord’s Indemnity Regarding Hazardous Materials: Landlord shall with
counsel reasonably acceptable to Tenant, indemnify, defend and hold harmless Tenant and Tenant’s shareholders, directors, officers, employees, partners, affiliates, and agents from, any claims, liabilities, costs or expenses incurred or
suffered by Tenant arising from the bringing, using, permitting. generating, emitting or disposing of Hazardous Materials by Landlord or the violation of any Governmental Regulation or environmental law, by Landlord or Landlord’s Agents.
Landlord’s indemnification and hold harmless obligations include, without limitation, the following: (i) claims, liability, costs or expenses resulting from or based upon administrative, judicial (civil or criminal) or other action, legal
or equitable, brought by any private or public person under common law or under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), the Resource Conservation and Recovery Act of 1980
(“RCRA”) or any other Federal, State, County 

  

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or Municipal Law, ordinance or regulation; (ii) claims, liabilities, costs or expenses pertaining to the identification, monitoring, cleanup,
containment, or removal of Hazardous Materials from soils, riverbeds or aquifers including the provision of an alternative public drinking water source; (iii) all costs of defending such claims; and (iv) all other liabilities, obligations,
penalties, fines, claims, actions (including remedial or enforcement actions of any kind and administrative or judicial proceedings, orders or judgments), damages (including consequential and punitive damages), and costs (including attorney,
consultant, and expert fees and expenses) resulting from the release or violation. This indemnification shall survive the expiration or termination o this Lease. 
 D. Actual Release by Tenant: Tenant agrees to notify Landlord of any lawsuits or orders which relate to the remedying of or actual release of Hazardous Materials on or into the soils or ground water at
or under the Premises. Tenant shall also provide Landlord all notices required by Section 25359.7(b) of the Health and Safety Code and all other notices required by law to be given to Landlord in connection with Hazardous Materials. Without
limiting the foregoing, each party shall also deliver to the other party, within twenty (20) days after receipt thereof, any written notices from any governmental agency alleging a material violation of, or material failure to comply with, any
federal, state or local laws, regulations, ordinances or orders, the violation of which or failure to comply with poses a foreseeable and material risk of contamination of the ground water or injury to humans (other than injury solely to Tenant,
Tenant’s Agents and employees within the Building). 
 In the event of any release on or into the Premises or into the soil or ground
water under the Premises, the Building or the Project of any Hazardous Materials used, treated, stored or disposed of by Tenant or Tenant’s Agents, Tenant agrees to comply, at its sole cost, with all laws, regulations, ordinances and orders of
any federal, state or local agency relating to the monitoring or remediation of such Hazardous Materials. In the event of any such release of Hazardous Materials Tenant shall immediately give verbal and follow-up written notice of the release to
Landlord, and Tenant agrees to meet and confer with Landlord and its Lender to attempt to eliminate and mitigate any financial exposure to such Lender and resultant exposure to Landlord under California Code of Civil Procedure Section 736(b) as
a result of such release, and promptly to take reasonable monitoring, cleanup and remedial steps given, inter alia, the historical uses to which the Property has and continues to be used, the risks to public health posed by the release, the then
available technology and the costs of remediation, cleanup and monitoring, consistent with acceptable customary practices for the type and severity of such contamination and all applicable laws. Nothing in the preceding sentence shall eliminate,
modify or reduce the obligation of Tenant under 12.B of this Lease to indemnify and hold Landlord and Master Landlord harmless from any claims liabilities, costs or expenses incurred or suffered by them rising from the bringing, using, permitting,
generating, emitting or disposing of Hazardous Materials by Tenant or a third party through the surface soils of the Premises during the Lease Term or the violation of any Governmental Regulation or environmental law, by Tenant or Tenant’s
Agents. Tenant shall provide Landlord prompt written notice of Tenant’s monitoring, cleanup and remedial steps. 
  

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 In the absence of an order of any federal, state or local governmental or quasi-governmental agency
relating to the cleanup, remediation or other response action required by applicable law, any dispute arising between Landlord and Tenant concerning Tenant’s obligation to Landlord under this Section 12.C concerning the level, method, and
manner of cleanup, remediation or response action required in connection with such a release of Hazardous Materials shall be resolved by mediation and/or arbitration pursuant to the provisions of Section 21.E, of this Lease. 
 E. Environmental Monitoring: Landlord and its agents shall have the right to inspect, investigate, sample and monitor the Premises including any air, soil,
water, ground water or other sampling or any other testing, digging, drilling or analysis to determine whether Tenant is complying with the terms of this Section 12 provided reasonable grounds to suspect a violation exist. If Landlord discovers
that Tenant is not in compliance with the terms of this Section 12, any such reasonable costs incurred by Landlord, including attorneys’ and consultants’ fees, shall be due and payable by Tenant to Landlord within thirty
(30) days following Landlord’s written demand therefore. 
 13. TENANT’S DEFAULT: The occurrence of any of the following shall
constitute a material default and breach of this Lease by Tenant: (i) Tenant’s failure to pay any rent including additional rent or any other payment due under this Lease within ten (10) days following Landlord’s notice of
nonpayment, (ii) the abandonment of the Premises by Tenant; (iii) Tenant’s failure to observe and perform any other required provision of this Lease, where such failure continues for thirty (30) days after written notice from
Landlord, provided, however, that if the nature of the default is such that it cannot reasonably be cured within the 30-day period, Tenant shall not be deemed in default if it commences within such period to cure, and thereafter diligently
prosecutes the same to completion; (iv) Tenant’s making of any general assignment for the benefit of creditors; (v) the filing by or against Tenant of a petition to have Tenant adjudged a bankrupt or of a petition for reorganization
or arrangement under any law relating to bankruptcy (unless, in the case of a petition filed against Tenant, the same is dismissed after the filing); (vi) the appointment of a trustee or receiver to take possession of substantially all of
Tenant’s assets located at the Premises or of Tenant’s interest in this Lease, where possession is not restored to Tenant within sixty (60) days; (vii) the attachment, execution or other judicial seizure of substantially all of
Tenant’s assets located at the Premises or of Tenant’s interest in this Lease, where such seizure is not discharged within sixty (60) days; (viii) a default by Tenant under the Building 2 Lease (if then leased by Tenant from
Landlord), or (ix) a default by Tenant under the Building 3 Lease (if leased by Tenant from Landlord). 
 A. Remedies: In
the event of any such default by Tenant, then in addition to other remedies available to Landlord at law or in equity, Landlord shall have the immediate option to terminate this Lease and all rights of Tenant hereunder by giving written notice of
such intention to terminate. In the event Landlord elects to so terminate this Lease, Landlord may recover from Tenant all the following: (i) the worth at time of award of any unpaid rent which had 

  

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been earned at the time of such termination; (ii) the worth at 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 for the same period that Tenant proves could have been reasonably avoided; (iii) the worth at time of award of the amount by which the unpaid rent for the balance of the
Lease Term after the time of award exceeds the amount of such rental loss that Tenant proves could be reasonably avoided; (iv) any other amount necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to
perform its obligations under this Lease, or which in the ordinary course of things would be likely to result therefrom; including the following: (x) reasonable expenses for repairing, altering or remodeling the Premises if such expenses are
necessary to relet the Premises, (y) reasonable broker’s fees, advertising costs or other expenses of reletting the Premises, and (a) costs of carrying the Premises such as taxes, insurance premiums, utilities and security precautions
and assessments due under the Declaration, and (v) at Landlord’s election, such other reasonable amounts in addition to or in lieu of the foregoing as may be permitted by applicable California law. The term “rent”, as used
herein, is defined as the minimum monthly installments of Base Monthly Rent and all other sums required to be paid by Tenant pursuant to this Lease, all such other suits being deemed as additional rent due hereunder. As used in (i) and
(ii) above, “worth at the time of award” shall be computed by allowing interest at a rate equal to the discount rate of the Federal Reserve Bank of San Francisco plus five (5%) percent per annum. As used in (iii) above,
“worth at the time of award” shall he computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus one (1%) percent. 
 B. Right to Re-enter: In the event of any such default by Tenant, Landlord shall have the right, after terminating this Lease, to
re-enter the Premises and remove all persons and property. Such property may be removed and stored in a public warehouse or elsewhere at the cost of and for the account of Tenant, and disposed of by Landlord in any manner permitted by law.

 C. Abandonment: If Landlord does not elect to terminate this Lease as provided in Section 13.A or 13.B above, then the
provisions of California Civil Code Section 1951.4, (Landlord may continue the lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due if Tenant has a right to sublet and assign, subject only to reasonable
limitations) as amended from time to time, shall apply and Landlord may from time to time, without terminating this Lease, either recover all rental as it becomes due or relet the Premises or any part thereof for such term or terms and at such
rental or rentals and upon such other terms and conditions as Landlord in its sole discretion may deem advisable, with the right to make alterations and repairs to the Premises. In the event that Landlord elects to so relet, rentals received by
Landlord from such relating shall be applied in the following order to: (i) the payment of any indebtedness other than Base Monthly Rent due hereunder from Tenant to Landlord; (ii) the payment of any cost of such reletting; (iii) the
payment of the cost of any alterations and repairs to the Premises; and (iv) the payment of Base Monthly Rent due and unpaid hereunder. The residual rentals, if any, shall be held by 

  

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Landlord and applied in payment of future Base Monthly Rent as the same may become due and payable hereunder. Landlord shall
             the obligation to market the space but shall have no obligation to relet the Premises following a default if Landlord has other comparable available space within the
Building or Project. In the event the portion of rentals received from such reletting which is applied to the payment of rent hereunder during any month be less than the rent payable during that month by Tenant hereunder, then Tenant shall pay such
deficiency to Landlord immediately upon demand. Such deficiency shall be calculated and paid monthly. Tenant shall also pay to Landlord, as soon as ascertained, any reasonable costs and expenses incurred by Landlord in such reletting or in making
such alterations and repairs not covered by the rentals received from such reletting. 
 D. No Termination: Landlord’s
re-entry or taking possession of the Premises pursuant to 13.B or 13.C shall not be construed as an election to terminate this Lease unless written notice of such intention is given to Tenant or unless the termination is decreed by a court of
competent jurisdiction. Notwithstanding any reletting without termination by Landlord because of any default by Tenant, Landlord may at any time after such reletting elect to terminate this Lease for any such default. 
 E. Non-Waiver: Landlord may accept Tenant’s payments without waiving any rights under this Lease, including rights under a previously
served notice of default. No payment by Tenant or receipt by Landlord of a lesser amount than any installment of rent due shall be deemed as other than payment on account of the amount due. If Landlord accepts payments after serving a notice of
default, Landlord may nevertheless commence and pursue an action to enforce rights and remedies under the previously served notice of default without giving Tenant any further notice or demand. Furthermore, the Landlord’s acceptance of rent
from the Tenant when the Tenant is holding over without express written consent does not convert Tenant’s Tenancy from a tenancy at sufferance to a month to month tenancy. No waiver of any provision of this Lease shall be implied by any failure
of Landlord to enforce any remedy for the violation of that provision, even if that violation continues or is repeated. Any waiver by Landlord of any provision of this Lease must be in writing. Such waiver shall affect only the provision specified
and only for the time and in the manner stated in the writing. No delay or omission in the exercise of any right or remedy by Landlord shall impair such right or remedy or be construed as a waiver thereof by Landlord. No act or conduct of Landlord,
including, without limitation, the acceptance of keys to the Premises, shall constitute acceptance of the surrender of the Premises by Tenant before the Expiration Date. Only written notice from Landlord to Tenant of acceptance shall constitute such
acceptance of surrender of the Premises. Landlord’s consent to or approval of any act by Tenant which requires Landlord’s consent or approvals shall not be deemed to waive or render unnecessary Landlord’s consent to or approval of any
subsequent act by Tenant. 
 F. Performance by Landlord: If Tenant fails to perform any obligation required under this Lease or
by law or governmental regulation, Landlord in its sole discretion may, following notice and expiration of the applicable cure period, without waiving any rights or remedies and 

  

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without releasing Tenant from its obligations hereunder, perform such obligation, in which event Tenant shall pay Landlord as additional rent all sums paid
by Landlord in connection with such substitute performance, including interest at the Agreed Interest Rate within thirty (30) days of Landlord’s written notice for such payment. 
 14. LANDLORD’S LIABILITY: 
 A.
Limitation on Landlord’s Liability: In the event of Landlord’s failure to perform any of its covenants or agreements under this Lease, Tenant shall give Landlord written notice of such failure and shall give Landlord thirty
(30) days to cure or commence to cure such failure prior to any claim for breach or resultant damages, provided, however, that if the nature of the default is such that it cannot reasonably be cured within the 30-day period, Landlord shall not
be deemed in default if it commences within such period to cure, and thereafter diligently prosecutes the same to completion. In addition, upon any such failure by Landlord, Tenant shall give notice by registered or certified mail to any person or
entity with a security interest in the Premises (“Mortgagee”) that has provided Tenant with notice of its interest in the Premises, and shall provide Mortgagee a reasonable opportunity to cure such failure, including such time to obtain
possession of the Premises by power of sale or judicial foreclosure, if such should prove necessary to effectuate a cure. Tenant agrees that each of the Mortgagees to whom this Lease has been assigned is an expressed third-party beneficiary hereof.
Tenant waives any right under California Civil Code Section 1950.7 or any other present or future law to the collection of any payment or deposit from Mortgagee or any purchaser at a foreclosure sale of Mortgagee’s interest unless
Mortgagee or such purchaser shall have actually received and, not refunded the applicable payment or deposit. Tenant further waives any right to terminate this Lease and to vacate the Premises on Landlord’s default under this Lease.
Tenant’s sole remedy on Landlord’s default is an action for damages or injunctive or declaratory relief. 
 B. Limitation
on Tenant’s Recourse: If Landlord is a corporation, trust, partnership, joint venture, unincorporated association or other form of business entity: (i) the obligations of Landlord shall not constitute personal obligations of the
officers, directors, trustees, partners, joint venturers, members, owners, stockholders, or other principals or representatives except to the extent of their interest in the Premises. Tenant shall have recourse only to the interest of Landlord in
the Premises or for the satisfaction of the obligations of Landlord and shall not have recourse to any other assets of Landlord for the satisfaction of such obligations. 
 C. Indemnification of Landlord: As a material part of the consideration rendered to Landlord, Tenant hereby waives all claims against Landlord except to the extent caused by Landlord’s gross
negligence, willful misconduct or a breach of this Lease for damages to goods, wares and merchandise, and all other personal property in, upon or about said Premises and for injuries to persons in or about said Premises, from any cause arising at
any time to the fullest extent permitted by law, and Tenant shall indemnify and hold Landlord, Master Landlord and their shareholders, directors, officers, trustees, 

  

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employees, partners, affiliates and agents exempt and harmless from any damage or injury to any person, or to the goods, wares and merchandise and all other
personal property of any person, arising from the use of the Premises, Building, and/or Project by Tenant and Tenant’s Agents or from the failure of Tenant to keep the Premises in good condition and repair as herein provided, except to the
extent due to the gross negligence or willful misconduct of Landlord. Further, in the event Landlord is made party to any litigation due to the acts or omission of Tenant and Tenant’s Agents, Tenant will indemnify, defend (with counsel
reasonably acceptable to Landlord) and hold Landlord harmless from any such claim or liability including Landlord’s costs and expenses and reasonable attorney’s fees incurred in defending such claims except to the extent due to the gross
negligence or willful misconduct of Landlord. 
 15. DESTRUCTION OF PREMISES: 
 A. Landlord’s Obligation to Restore: In the event of a destruction of the Premises during the Lease Term Landlord shall repair the same
to the approximate condition which existed prior to such destruction. Such destruction shall not annul or void this Lease; however, Tenant shall be entitled to a proportionate reduction of Base Monthly Rent while repairs are being made, such
proportionate reduction to be based upon the extent to which the repairs interfere with Tenant’s business in the Premises, as reasonably determined by the Parties. In no event shall Landlord be required to replace or restore Alterations, Tenant
Improvements, Tenant’s fixtures or personal property. With respect to a destruction which Landlord is obligated to repair or may elect to repair under the terms of this Section, Tenant waives the provisions of Section 1932, and
Section 1933, Subdivision 4, of the Civil Code of the State of California, and any other similarly enacted statute, and the provisions of this Section 15 shall govern in the case of such destruction. If Landlord is required to repair the
Premises in the event of destruction pursuant to this Lease, Landlord agrees that it will not vote under the Declaration in favor or not repairing Premises or Common Area. 
 B. Limitations on Landlord’s Restoration Obligation: Notwithstanding the provisions of Section 15.A, Landlord shall have no
obligation to repair, or restore the Premises if any of the following occur (i) if the repairs cannot be made in three hundred sixty five (365) days from the date of receipt of all governmental approvals necessary under the laws and
regulations of State, Federal, County or Municipal authorities, as reasonably determined by Landlord, (ii) if the holder of the first deed of trust or mortgage encumbering the Building elects not to permit the insurance proceeds payable upon
damage or destruction to be used for such repair or restoration, (iii) the damage or destruction is not fully covered by the insurance maintained by Landlord, (iv) the damage or destruction occurs in the last twenty four (24) months
of the Lease Term (unless Tenant commits to exercise any available option to extend the Lease Term pursuant to Section 18 of this Lease), (v) Tenant is in default pursuant to the provisions of Section 13 beyond expiration of the
applicable cure period, (vi) Tenant has vacated the Premises for more than ninety (90) days, or (vii) if repair of the Common Area is necessary before repairs to the Premises cart be performed and Landlord reasonably 

  

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determines that repairs to the Common. Area will not be made within one hundred eighty (180) days after the date of the damage and destruction. In any
such event Landlord may elect either to (i) complete the repair or restoration, or (ii) terminate this Lease by providing Tenant written notice of its election within sixty (60) days following the damage or destruction. 
 C. Tenant’s Rights with Respect to a Destruction of the Premises: Notwithstanding anything to the contrary contained in this Lease:
Landlord shall give notice to Tenant of its election to rebuild or not to rebuild the Premises within thirty (30) days of casualty to the Premises and such notice shall specify Landlord’s architect’s or engineer’s reasonable
estimate as to the time required to rebuild or restore the Premises. If, in the reasonable opinion of Landlord’s architect or engineer, the Premises will take longer than three hundred sixty five (365) days to rebuild or restore and
Landlord has elected to perform such rebuilding or restoration, Tenant may, notwithstanding Landlord’s election, terminate this Lease by written notice to Landlord of such termination within five (5) days after its receipt of
Landlord’s notice. Such termination shall be effective thirty (30) days after the giving of Tenant’s notice. If Landlord fails to restore the Premises (including reasonable means of access thereto) within a period which is sixty
(60) days longer than the period stated in Landlord’s notice to Tenant as the estimated rebuilding period, Tenant, at any time thereafter until such rebuilding is completed, may terminate this Lease by delivering written notice to Landlord
of such termination, in which event this Lease shall terminate as of the date of the giving of such notice. If casualty to the Premises occurs within the last twenty-four months of the term and the period in which Tenant is obligated to exercise its
option to renew the term pursuant to Section 18 has not expired, Tenant shall have thirty (30) days after the date of casualty in which to notify Landlord of its election to exercise such renewal option. If Tenant elects to renew the term
as provided above, Landlord shall have no right to terminate the Lease pursuant to this Section 15. 
 16. CONDEMNATION:
If any part of the Premises shall be taken for any public or quasi-public use, under any statute or by right of eminent domain or private purchase in lieu thereof, and only a part thereof remains which is susceptible of occupation hereunder, this
Lease shall, as to the part so taken, terminate as of the day before title vests in the condemnor or purchaser (“Vesting Date”) and Base Monthly Rent payable hereunder shall be adjusted so that Tenant is required to pay for the remainder
of the Lease Term only such portion of Base Monthly Rent as the value of the part remaining after such taking bears to the value of the entire Premises prior to such taking. If all of the Premises or such part thereof be taken so that there does not
remain a portion susceptible for occupation hereunder, this Lease shall terminate on the Vesting Date. If part or all of the Premises be taken, all compensation awarded upon such taking shall go to Landlord, and Tenant shall have no claim thereto;
but Landlord shall cooperate with Tenant, without cost to Landlord, to recover compensation for damage to or taking of any Alterations, Tenant Improvements, or for Tenant’s moving costs. Tenant hereby waives the provisions of California Code of
Civil Procedures Section 1265.130 and any other similarly enacted statute, and the provisions of this Section 16 shall govern in the case of such taking. 
  

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 17. ASSIGNMENT OR SUBLEASE: 
 A. Consent by Landlord: Except as specifically provided in this Section 17.E, Tenant may not assign, sublet, hypothecate, or allow a third party to use the Premises without the express written
consent of Landlord which shall not be unreasonably withheld, conditioned or delayed. Except in connection with a Permitted Transfer, in the event Tenant desires to assign this Lease or any interest herein including, without limitation, a pledge,
mortgage or other hypothecation, or sublet the Premises or any part thereof, Tenant shall deliver to Landlord (i) executed counterparts of any agreement and of all ancillary agreements with the proposed assignee/subtenant, (ii) current
financial statements of the transferee covering the preceding three years if available, (iii) the nature of the proposed transferee’s business to be carried on in the Premises, (iv) a statement outlining all consideration to be given
on account of the Transfer, and (v) a current financial statement of Tenant. Landlord may condition its approval of any Transfer to a certification from both Tenant and the proposed transferee of all consideration to be paid to Tenant in
connection with such Transfer. At Landlord’s request, Tenant shall also provide additional information reasonably required by Landlord to determine whether it will consent to the proposed assignment or sublease. Landlord shall have a fifteen
business (15) day period following receipt of all the foregoing within which to notify Tenant in writing that Landlord elects to: (i) terminate this Lease in the event of an assignment only; (ii) permit Tenant to assign or sublet such
space to the named assignee/subtenant on the terms and conditions set forth in the notice; or (iii) refuse consent. If Landlord should fail to notify Tenant in writing of such election within the 15-day period, Landlord shall be deemed to have
elected option (ii) above. In the event Landlord elects option (i) above, this Lease shall expire with respect to such part of the Premises on the date upon which the proposed sublease was to commence, and from such date forward, Base
Monthly Rent and Tenant’s Allocable Share of all other costs and charges shall be adjusted based upon the proportion that the rentable area of the Premises remaining bears to the total rentable area of the Premises. In the event Landlord elects
option (ii) above, Landlord’s written consent to the proposed assignment or sublease shall not be unreasonably withheld, provided and upon the condition that; (i) the proposed assignee or subtenant is engaged in a business that is
limited to the use expressly permitted under this Lease; (ii) the proposed assignee or subtenant is a company with sufficient financial worth and management ability to undertake the financial obligation of this Lease and Landlord has been
furnished with reasonable proof thereof; (iii) the proposed assignment or sublease is in form reasonably satisfactory to Landlord; (iv) Tenant reimburses Landlord on demand for any reasonable costs that may be incurred by Landlord in
connection with said assignment or sublease, including the costs of making investigations as to the acceptability of the proposed assignee or subtenant and legal costs incurred in connection with the granting of any requested consent; and
(vi) Tenant shall not have advertised or publicized in any way the availability of the Premises without prior notice to Landlord. In the event all or any one of the foregoing conditions are not satisfied, Landlord shall be considered to have
acted reasonably if it withholds its consent. 
  

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 B. Assignment or Subletting Consideration: Any rent or other economic consideration
realized by Tenant under any sublease and assignment, in excess of the rent payable hereunder after deducting (i) reasonable subletting and assignment costs (ii) the Monthly Amortized Cost (defined below) of the Tenant improvements paid by
Tenant, and (iii) any economic consideration received by Tenant for services rendered or personal property sold or leased, shall be divided and paid fifty percent (50%) to Landlord and fifty percent (50%) to Tenant. Monthly Amortized
Cost shall be determined by taking sum paid by Tenant for the Tenant Improvements installed in the Building and dividing this sum by one hundred forty four (144) months. Tenant’s obligation to pay over Landlord’s portion of the
consideration constitutes an obligation for additional rent hereunder. The above provisions relating to Landlord’s right to terminate the Lease and relating to the allocation of bonus rent are independently negotiated terms of the Lease which
constitute a material inducement for the Landlord to enter into the Lease, and are agreed by the parties to be commercially reasonable. No assignment or subletting by Tenant shall relieve it of any obligation under this Lease. Any assignment or
subletting except in connection with a Permitted Transfer which conflicts with the provisions hereof shall be void. 
 C. No
Release: Any assignment or sublease except in connection with a Permitted Transfer shall be made only if and shall not be effective until the assignee or subtenant shall execute, acknowledge, and deliver to Landlord an agreement, in form and
substance satisfactory to Landlord, whereby the assignee or subtenant shall assume all the obligations of this Lease on the part of Tenant to be performed or observed anti shall be subject to all the covenants, agreements, terms. provisions and
conditions in this Lease. Notwithstanding any such sublease or assignment and the acceptance of rent by Landlord from any subtenant or assignee, Tenant and any guarantor shall remain fully liable for the payment of Base Monthly Rent and additional
rent due, and to become due hereunder, for the performance of all the covenants, agreements, terms, provisions and conditions contained in this Lease on the part of Tenant to be performed and for all acts and omissions of any licensee, Subtenant,
assignee or any other person claiming under or through any subtenant or assignee that shall be in violation of any of the terms and conditions of this Lease, and any such violation shall be deemed a violation by Tenant. Tenant shall indemnify,
defend and hold Landlord harmless from and against all losses, liabilities, damages, costs and expenses (including reasonable attorney fees) resulting from any claims that may be made against Landlord by the proposed assignee or subtenant or by any
real estate brokers or other persons claiming compensation in connection with the proposed assignment or sublease, unless caused by Landlord’s breach of this Lease. 
 D. Reorganization of Tenant: The provisions of this Section 17.D shall apply if Tenant is a corporation and: (i) there is a dissolution, merger, consolidation, or other reorganization of or
affecting Tenant, where Tenant is not the surviving corporation, or (ii) there is a sale or transfer to one person or 

  

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entity (or to any group of related persona or entities) of stock possessing more than 50% of the total combined voting power of ail classes of Tenant’s
capital stock issued, outstanding and entitled to vote for the election of directors, and after such sale or transfer of stock Tenant’s stock is no longer publicly traded. In a transaction under clause (i) the surviving corporation shall
promptly execute and deliver to Landlord an agreement in form reasonably satisfactory to Landlord under which such corporation assumes the obligations of Tenant hereunder, and in a transaction under clause (ii) the transferee shall promptly
execute and deliver to Landlord an agreement in form reasonably satisfactory to Landlord under which such transferee assumes the obligations of Tenant to the extent accruing after such transferee’s acquisition of Tenant’s stock possessing
more than 50% of the total combined voting of all classes of Tenant’s capital stock issued, outstanding and entitled to vote for the election of directors. 
 E. Permitted Transfers: Notwithstanding anything contained in this Section 17, Tenant may enter into any of the following transfers (a “Permitted Transfer”) without Landlord’s prior
consent, and Landlord shall not be entitled to terminate the Lease or to receive any part of any subrent resulting therefrom that would otherwise be due pursuant to Sections 17.A and 17.B. Tenant may sublease all or part of the Premises or assign
its interest in this Lease to (i) any person or entity which controls, is controlled by, or is under common control with the original Tenant to this Lease by means of art ownership interest of more than 50%; (ii) any person or entity which
results from a merger, consolidation or other reorganization in which Tenant is not the survivor, so long as the survivor has a net worth at the time of such transfer sufficient to enable it to meet its obligations under this Lease; and
(iii) any person or entity which purchases or otherwise acquires all or substantially all of the assets of Tenant so long as such acquiring person or entity has a net worth at the time of such transfer that is sufficient at the time of such
transfer to enable it to meet its obligations under this Lease. 
 F. Effect of Default: In the event of Tenant’s default,
Tenant hereby assigns all rents due from any assignment or subletting to Landlord as security for performance of its obligations under this Lease, and Landlord may collect such rents as Tenant’s Attorney-in- Fact, except that Tenant may collect
such rents unless a default occurs as described in Section 13 above. A Lease termination due to Tenant’s default shall not automatically terminate an assignment or sublease then in existence; rather at Landlord’s election, such
assignment or sublease shall survive the Lease termination, the assignee or subtenant shall attorn to Landlord, and Landlord shall undertake the obligations of Tenant under the sublease or assignment; except that Landlord shall not be liable for
prepaid rent, security deposits or other defaults of Tenant to the subtenant or assignee, or for any acts or omissions of Tenant and Tenant’s Agents. 
 G. Conveyance by Landlord: As used in this Lease, the term “Landlord” is defined only as the owner for the time being of the Premises, K. that in the event of any sale or other conveyance of
the Premises or in the event of a master lease of the Premises, Landlord shall be entirely freed and relieved of all its covenants and obligations hereunder, and it shall be deemed and construed, without further agreement between the parties and the

  

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purchaser at any such sale or the master tenant of the Premises, so that the purchaser or master tenant of the Premises has assumed and agreed to carry out
any and all covenants and obligations of Landlord hereunder. Such transferor shall transfer and deliver Tenant’s security deposit to the purchaser at any such sale or the master tenant of the Premises, and thereupon the transferor shall be
discharged from any further liability in reference thereto. 
 H. Successors and Assigns: Subject to the provisions this
Section 17, the covenants and conditions of this Lease shall apply to and bind the heirs, successors, executors, administrators and assigns of all parties hereto; and all parties hereto shall be jointly and severally liable hereunder.

 18. OPTION TO EXTEND THE LEASE TERM: 
 A. Grant and Exercise of Option: Landlord grants to Tenant, subject to the terms and conditions set forth in this Section 18.A, two (2) options (the “Options”) to extend the Lease Term for an additional
term (the “Option Term”). Each Option Term shall be for a period of sixty (60) months and shall be exercised, if at all, by written notice to Landlord no earlier than eighteen (18) months prior to the date the Lease Term would
expire but for such exercise but no later than twelve (12) months prior to the date the Lease Term would expire but for such exercise, time being of the essence for the giving of such notice. If Tenant exercises the first Option or both of the
Options, all of the terms, covenants and conditions of this Lease except this Section shall apply during the Option Term as though the expiration date of the Option Term was the date originally set forth herein as the Expiration Date, provided that
Base Monthly Rent for the Premises payable by Tenant dieing the Option Term shall be the greater of (i) the average amount of Base Monthly Rent paid during the initial Lease Term, and (ii) ninety five percent (95%) of the Fair Market
Rental as hereinafter defined. Notwithstanding anything herein to the contrary, if Tenant is in monetary or material non-monetary default after expiration of any applicable cure period under any of the terms, covenants or conditions of this Lease
either at the time Tenant exercises the Option or at any time thereafter prior to the commencement date of the Option Term, Landlord shall have, in addition to all of Landlord’s other rights and remedies provided in this Lease, the right to
terminate the Option upon notice to Tenant, in which event the expiration date of this Lease shall be and remain the Expiration Date. As used herein, the term “Fair Market Rental” is defined as the rental and all other monetary payments,
including any escalations and adjustments thereto (including without limitation Consumer Price Indexing) that Landlord could obtain during the Option Term from a third party desiring to lease the Premises, based upon the current use and other
potential uses of the Premises, as determined by the rents then being obtained for new leases of space comparable in age and quality to the Premises in the locality of the Building. The appraisers shall be instructed that the foregoing five percent
(5%) discount is intended to reduce comparable rents which include (i) brokerage commissions, (ii) tenant improvement allowances, and (iii) vacancy costs, to account for the fact that Landlord will not suffer such costs in the
event Tenant exercises its Option. 
  

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 B. Determination of Fair Market Rental: If Tenant exercises the Option, Landlord shall send Tenant
a notice setting forth the Fair Market Rental for the Option Term within thirty (30) days following the Exercise Date. If Tenant disputes Landlord’s determination of Fair Market Rental for the Option Term, Tenant shall, within thirty
(30) days after the date of Landlord’s notice meting forth Fair Market Rental for the Option Term, send to Landlord a notice stating that Tenant either elects to terminate its exercise of the Option, in which event the Option shall lapse
and this Lease shall terminate on the Expiration Date, or that Tenant disagrees with Landlord’s determination of Fair Market Rental for the Option Term and elects to resolve the disagreement as provided in Section 18.C below. If Tenant
elects to resolve the disagreement as provided in Section 18.C and such procedures are not concluded prior to the commencement date of the Option Term, Tenant shall pay to Landlord as Base Monthly Rent the Fair Market Rental as determined by
Landlord in the manner provided above. lf the Fair Market Rental as finally determined pursuant to Section 18.C is greater than Landlord’s determination, Tenant shall pay Landlord the difference between the amount paid by Tenant and the
Fair Market Rental as so determined in Section 18.C within thirty (30) days after such determination. If the Fair Market Rental as finally determined in Section 18.C is less than Landlord’s determination, the difference between
the amount paid by Tenant and the Fair Market Rental as so determined in Section 18.C shall be credited against the next installments of rent due from Tenant to Landlord hereunder. 
 C. Resolution of a Disagreement over the Fair Market Rental: Any disagreement regarding Fair Market Rental shall be resolved as follows:

 (i) Within thirty (30) days after Tenant’s response to Landlord’s notice setting forth the Fair
Market Rental, Landlord and Tenant shall meet at least two (2) times at a mutually agreeable time and place, in an attempt to resolve the disagreement. 
 (ii) If within the 30-day period referred to above, Landlord and Tenant cannot reach agreement as to Fair Market Rental, each party
shall select one appraiser to determine Fair Market Rental. Each such appraiser shall arrive at a determination of Fair Market Rental and submit their conclusions to Landlord and Tenant within thirty (30) days after the expiration of the 30-day
consultation period described above. 
 (iii) If only one appraisal is submitted within the requisite time period, it
shall be deemed as Fair Market Rental. If both appraisals are submitted within such time period and the two appraisals so submitted differ by less than ten percent (10%), the average of the two shall be deemed as Fair Market Rental. If the two
appraisals differ by more than 10%, the appraisers shall immediately select a third appraiser who shall, within thirty (30) days after his selection, make and submit to Landlord and Tenant a determination of Fair Market Rental. This third
appraisal will then be averaged with the closer of the two previous appraisals and the result shall be Fair Market Rental. 
 (iv) All appraisers specified pursuant to this Section shall be members of the American Institute of Real Estate Appraisers with not less titan ten (10) years experience appraising office and industrial properties in the Santa
Clara Valley. Each party shall pay the cost of the appraiser selected by such party and one-half of the cast of the third appraiser. 
  

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 D. Personal to Tenant: All Options provided to Tenant in this Lease are personal and
granted to Siebel Systems, Inc. and any Permitted Transferee and are not exercisable by any third party should Tenant assign or sublet all or a portion of its rights under this Lease, unless Landlord consents to permit exercise of any option by any
assignee or subtenant, in Landlord’s sole and absolute discretion. In the event Tenant has multiple options to extend this Lease, a later option to extend the Lease cannot be exercised unless the prior option has been so exercised. 

19. OPTION TO LEASE: 
 A. Grant and
Exercise of Option: Landlord grants to Tenant an option to lease Building 3 under the terms and conditions specified in the Building 2 Lease. 
 20.
RIGHT OF FIRST OFFERING TO PURCHASE: 
 A. Grant and Exercise of Option: In the event either or both Master Landlord and
Landlord elect to sell their respective interests in the Building, Master Landlord and Landlord hereby grants Tenant a right of first offering to purchase their respective interests in the Building (Master Landlord and Landlord are individually and
collectively referred to in this Section as “Seller”). Prior to Seller offering to sell its interest in the Building to a third party, Seller shall give Tenant written notice of such desire and the terms and other information under which
Seller intends to sell the Building. Provided at the time of exercise, Tenant is not in default beyond the expiration of any applicable cure period, Tenant shall have the option, which must be exercised, if at all, by written notice to Seller within
thirty (30) days after Tenant’s receipt of Seller’s notice, to purchase its interest in the Building at the sales price and terms of sale specified in the notice. In the event Tenant timely exercises such option to purchase its
interest in the Building, Seller shall sell its interest in the Building to Tenant, and Tenant shall purchase its interest in the Building from Seller in accordance with the price and terms specified in Seller’s notice Seller and Tenant shall,
in good faith, attempt to reach agreement on the terms of a mutually acceptable purchase agreement consistent with the terms set forth in Seller’s notice within thirty (30) days of Seller’s notice. In the event (i) Seller and
Tenant are unable to reach agreement on a mutually acceptable purchase agreement within such thirty (30) day period or (ii) Tenant fails to exercise Tenant’s option within said thirty (30) day period, Seller shall have one
hundred eighty (180) days thereafter to sell its interest in the Building at no less than ninety five percent (95%) of the sales price and upon the same or substantially the same other terms of sale as specified in the notice to Tenant. In
the event Seller fails to sell its interest in the Building within said one hundred eighty (180) day period or in the event Seller proposes to sell its interest in the Building at less than ninety five percent (95%) of the sales price or
on other material terms which are more favorable to the prospective buyer than that proposed to Tenant, Seller shall be required to resubmit such offer to Tenant in accordance with this Right of First Offering except that Tenant shall be required to
respond to any resubmission within a seven (7) day period. 
  

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 B. Exclusions: This Right of First Offering shall automatically terminate, (i) upon the
expiration or sooner termination of the Lease, or (ii) in the event of a foreclosure or other involuntary transfer of Landlord’s interest in the Building. Notwithstanding the forgoing, this Right of First Offering shall not apply to
transfers (but shall survive such transfers ) of all or a portion of the Building or Project to (i) John A. Sobrato and/or John M. Sobrato (individually and collectively “Sobrato”), and (ii) any immediate family member of
Sobrato, and (iii) any trust established, in whole or in part, for the benefit of Sobrato and/or any immediate family member of Sobrato, (iv) any partnership in which Sobrato or any immediate family member, either directly or indirectly
(e.g., through a partnership or corporate entity or a trust) retains a general partner interest, and/or (v) any corporation under the control, either directly or indirectly, by Sobrato or any immediate family member of Sobrato. 
 21. GENERAL PROVISIONS: 
 A. Attorney’s
Fees: In the event a suit or alternative form of dispute resolution is brought for the possession of the Premises, for the recovery of any sum due hereunder, to interpret the Lease, or because of the breach of any other covenant herein; then the
losing party shall pay to the prevailing party reasonable attorney’s fees including the expense of expert witnesses, depositions and court testimony as part of its costs which shall be deemed to have accrued on the commencement of such action.
The prevailing party shall also be entitled to recover all costs and expenses including reasonable attorney’s fees incurred in enforcing any judgment or award against the other party. The foregoing provision relating to post-judgment costs is
severable from all other provisions of this Lease. 
 B. Authority of Parties: Tenant represents and warrants that it is duly formed
and in good standing, and is duly authorized to execute and deliver this Lease on behalf of said corporation, in accordance with a duly adopted resolution of the Board of Directors of said corporation or in accordance with the bylaws of said
corporation, and that this Lease is binding upon said corporation in accordance with its terms. At Landlord’s request, Tenant shall provide Landlord with corporate resolutions or other proof in a form acceptable to Landlord, authorizing the
execution of the Lease. 
 C. Brokers: Tenant represents it has not utilized or contacted a real estate broker or finder with respect
to this Lease other than Chris Allen, d/b/a Resource Real Estate Group, which fee shall be payable by Landlord pursuant to a written agreement and the Parties agree to indemnify, defend and hold each other harmless against any claim, cost, liability
or cause of action asserted by any other broker or finder. 
 D. Choice of Law: This Lease shall be governed by and construed in
accordance with California law. Except as provided in Section 21.E, venue shall be Santa Clara County. 
 E. Dispute Resolution:
Landlord and Tenant and any other party that may become a party to this Lease or be deemed a party to this Lease including any subtenants agree that, 

  

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except for any claim by Landlord for unlawful detainer or any claim within the jurisdiction of the small claims court (which small claims court shall be the
sole court of competent jurisdiction), any controversy, dispute, or claim of whatever nature arising out of, in connection with or in relation to the interpretation, performance or breach of this Lease, including any claim based on contract, tort,
or statute, shall be resolved at the request of any party to this agreement through a two-step dispute resolution process administered by J.A.M.S. or another judicial mediation service mutually acceptable to the parties located in Santa Clara
County, California. The dispute resolution process shall involve first, mediation, followed, if necessary, by final and binding arbitration administered by and in accordance with the then existing rules and practices of J.A.M.S. or other judicial
mediation service selected. In the event of any dispute subject to this provision, either party may initiate a request for mediation and the parties shall use reasonable efforts to promptly select a J.A.M.S. mediator and commence the mediation. In
the event the parties are not able to agree on a mediator within thirty (30) days, J.A.M.S. or another judicial mediation service mutually acceptable to the parties shall appoint a mediator. The mediation shall be confidential and in accordance
with California Evidence Code § 1119 et. seq. The mediation shall be held in Santa Clara County, California and in accordance with the existing rules and practice of J.A.M.S. (or other judicial and mediation service selected). The parties
shall use reasonable efforts to conclude the mediation within sixty (60) days of the date of either party’s request for mediation. The mediation shall be held prior to any arbitration or court action (other than a claim by Landlord for
unlawful detainer or any claim within the jurisdiction of the small claims court which are not subject to this mediation/arbitration provision and may be filed directly with a court of competent jurisdiction). Should the prevailing party in arty
dispute subject to this Section 19.E attempt an arbitration or a court action before attempting to mediate, the prevailing party shall not be entitled to attorney’s fees that might otherwise be available to them in a court action or
arbitration and in addition thereto, the party who is determined by the arbitrator to have resisted mediation, shall be sanctioned by the arbitrator or judge. 
 IF A MEDIATION IS CONDUCTED BUT IS UNSUCCESSFUL, IT SHALL BE FOLLOWED BY FINAL AND BINDING ARBITRATION ADMINISTERED BY AND IN ACCORDANCE WITH THE THEN EXISTING RULES AND PRACTICES OF J.A.M.S. OR THE OTHER JUDICIAL AND
MEDIATION SERVICE SELECTED, AND JUDGMENT UPON ANY AWARD RENDERED BY THE ARBITRATOR(S) MAY BE ENTERED BY ANY STATE OR FEDERAL COURT HAVING JURISDICTION THEREOF AS PROVIDED BY CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 1280 ET. SEQ, AS SAID
STATUTES THEN APPEAR, INCLUDING ANY AMENDMENTS TO SAID STATUTES OR SUCCESSORS TO SAID STATUTES OR AMENDED STATUTES, EXCEPT THAT IN NO EVENT SHALL TEE PARTIES BE ENTITLED TO PROPOUND INTERROGATORIES OR REQUEST FOR ADMISSIONS DURING THE ARBITRATION
PROCESS. THE ARBITRATOR SHALL BE A RETIRED JUDGE OR A LICENSED CALIFORNIA ATTORNEY. THE VENUE FOR ANY SUCH ARBITRATION OR MEDIATION SHALL BE IN SANTA CLARA COUNTY, CALIFORNIA. 
  

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 NOTICE: BY INITIALING IN THE SPACE BELOW YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS
INCLUDED IN THE “MEDIATION AND ARBITRATION OF DISPUTES” PROVISION DECIDED BY NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR FURY TRIAL. BY
INITIALING IN THE SPACE BELOW YOU ARE GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY AND APPEAL UNLESS THOSE RIGHTS ARE SPECIFICALLY INCLUDED IN THE “MEDIATION AND ARBITRATION OF DISPUTES” PROVISION. IF YOU REFUSE TO SUBMIT TO ARBITRATION
AFTER AGREEING TO THIS PROVISION, YOU MAY BE COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE. YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY. 
 WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE “MEDIATION AND ARBITRATION OF
DISPUTES” PROVISION TO NEUTRAL ARBITRATION. 
 LANDLORD:
              TENANT:              
 F. Entire Agreement: This Lease and the exhibits attached hereto contains all of the agreements and conditions made between the parties hereto and
may not be modified orally or in any other manner other than by written agreement signed by all parties hereto or their respective successors in interest. This Lease supersedes and revokes all previous negotiations, letters of intent, lease
proposals, brochures, agreements, representations, promises, warranties, and understandings, whether oral or in writing, between the parties or their respective representatives or any other person purporting to represent Landlord or Tenant.

 G. Entry by Landlord: Upon prior notice to Tenant and subject to Tenant’s reasonable security regulations, Tenant shall permit
Landlord and his agents to enter into and upon the Premises at all reasonable times, and without any rent abatement or reduction or any liability to Tenant for any loss of occupation or quiet enjoyment of the Premises thereby occasioned, unless
caused by Landlord’s negligence or willful misconduct, for the following purposes: (i) inspecting and maintaining the Premises; (ii) making repairs, alterations or additions (only if agreed by Tenant) to the Premises;
(iii) erecting additional building(s) and improvements on the land where the Premises are situated or on adjacent land owned by Landlord; and (iv) performing any obligations of Landlord under the Lease including remediation of hazardous
materials if determined to be the responsibility of Landlord provided that Landlord agrees to use reasonable efforts to minimize interference with Tenant’s use. Tenant shall permit Landlord and his agents, at any time within one hundred eighty
(180) days prior to the Expiration Date (or at any time during the Lease if Tenant is in default hereunder), to place upon the Premises “For Lease” signs and exhibit the Premises to real estate brokers and prospective tenants at
reasonable hours. 
  

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 H. Estoppel Certificates: At any time during the Lease Term, each party (the “Responding
Party”) shall, within ten (10) days following written notice from the other party (the “Requesting Party”), execute and deliver to the Requesting Party a written statement certifying, if true, the following: (i) that this
Lease is unmodified and in full force and effect (or, if modified, stating the nature of such modification); (ii) the date to which rent and other charges are paid in advance, if any; (iii) acknowledging that there are not, to Responding
Party’s knowledge, any uncured defaults on Requesting Party’s part hereunder (or specifying such defaults if they are claimed); and (iv) such other information as Requesting Party may reasonably request Any such statement may be
conclusively relied upon by any prospective purchaser or encumbrancer of Requesting Party’s interest in the Premises. The Responding Party’s failure to deliver such statement within such time shall be conclusive upon the Responding Party
that this Lease is in full force and effect without modification, except as may be represented by the Requesting Party, and that there are no uncured defaults in Requesting Party’s performance. Tenant agrees to provide, within five
(5) days of Landlord’s request, Tenant’s most recent three (3) years of audited financial statements for Landlord’s use in financing the Premises or Landlord’s interest therein. 
 I. Exhibits: All exhibits referred to are attached to this Lease and incorporated by reference. 
 J. Interest: All rent due hereunder, if not paid when due, shall bear interest at the rate of the Reference Rate published by Bank of America, San
Francisco Branch, plus two percent (2%) per annum from that date until paid lit full (“Agreed Interest Rate”). This provision shall survive the expiration or sooner termination of the Lease. Despite any other provision of this Lease,
the total liability for interest payments shall not exceed the limits, if any, imposed by the usury laws of the State of California. Any interest paid in excess of those limits shall be refunded to Tenant by application of the amount of excess
interest paid against any sums outstanding in any order that Landlord requires. If the amount of excess interest paid exceeds the sums outstanding, the portion exceeding those sums shall be refunded in cash to Tenant by Landlord. To ascertain
whether any interest payable exceeds the limits imposed, any non-principal payment including late charges) shall be considered to the extent permitted by law to be an expense or a fee, premium, or penalty rather than interest. 
 K. Modifications Required by Lender: If any Lender of Landlord or ground lessor of the Real Property Requires a modification of this Lease that
will not increase Tenant’s cost or expense or materially or adversely change Tenant’s rights and obligations, this Lease shall be so modified and Tenant shall execute whatever documents arc required and deliver them to Landlord within ten
(10) days after the request. 
 L. No Presumption Against Drafter: Landlord and Tenant understand, agree and acknowledge that
this Lease has been freely negotiated by both parties; and that in any controversy, dispute, or contest over the meaning, interpretation, validity, or enforceability of this Lease or any of its terms or conditions, there shall be no inference,
presumption, or conclusion drawn whatsoever against either party by virtue of that party having drafted this Lease or any portion thereof. 
  

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 M. Notices: All notices, demands, requests, or consents required to be given under this Lease
shall be sent in writing by U.S. certified mail, return receipt requested, or by personal delivery or by a nationally recognized overnight courier addressed to the party to be notified at the address for such party specified in Section 1 of
this Lease, or to such other place as the party to be notified may from time to time designate by at least fifteen (15) days prior notice to the notifying party. When this Lease requires service of a notice, that notice shall replace rather
than supplement any equivalent or similar statutory notice, including any notices required by Code of Civil Procedure Section 1161 or any similar or successor statute. When a statute requires service of a notice in a particular manner, service
of that notice (or a similar notice required by this lease) shall replace and satisfy the statutory service-of-notice procedures, including those required by Code of Civil Procedure Section 1162 or any similar or successor statute. 

N. Property Management: No property management fee shall be payable to Landlord. 
 O. Rent: All monetary sums due from Tenant to Landlord under this Lease, including, without limitation those referred to as “additional
rent”, shall be deemed as rent. 
 P. Representations: Tenant acknowledges that neither Landlord nor any of its employees or
agents have made any agreements, representations, warranties or promises with respect to the Premises or with respect to present or future rents, expenses, operations, tenancies or any other matter. Except as herein expressly set forth herein,
Tenant relied on no statement of Landlord or its employees or agents for that purpose. 
 Q. Rights and Remedies: All rights and
remedies hereunder are cumulative and not alternative to the extent permitted by law, and are in addition to all other rights and remedies in law and in equity. 
 R. Severability: If any term or provision of this Lease is held unenforceable or invalid by a court of competent jurisdiction, the remainder of the Lease shall not be invalidated thereby but shall be
enforceable in accordance with its terms, omitting the invalid or unenforceable term. 
 S. Submission of Lease: Submission of this
document for examination or signature by the parties does not constitute an option or offer to lease the Premises on the terms in this document or a reservation of the Premises in favor of Tenant. This document is not effective as a lease or
otherwise until executed and delivered by both Landlord and Tenant. 
 T. Subordination: This Lease is subject and subordinate to
ground and underlying leases, mortgages and deeds of trust (collectively “Encumbrances”) which may now affect the Premises, to any covenants, conditions or restrictions of record, and to all renewals, modifications, consolidations,
replacements and extensions thereof; provided, however, if 

  

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the holder or holders of any such Encumbrance (“Holder”) require that this Lease be prior and superior thereto, within seven (7) days after
written request of Landlord to Tenant, Tenant shall execute, have acknowledged and deliver all documents or instruments, in the form presented to Tenant, which Landlord or Holder deems necessary or desirable for such purposes. Landlord shall have
the right to cause this Lease to be and become and remain subject and subordinate to any and all Encumbrances which are now or may hereafter be executed covering the Premises or any renewals, modifications, consolidations, replacements or extensions
thereof, for the full amount of all advances made or to be made thereunder and without regard to the time or character of such advances, together with interest thereon and subject to all the terms and provisions thereof; provided only, that in the
event of termination of any such lease or upon the foreclosure of any such mortgage or deed of trust, Holder agrees to recognize Tenant’s rights under this Lease as long as Tenant is not then in default beyond the expiration of any applicable
cure period and continues to pay Base Monthly Rent and additional rent and observes and performs all required provisions of this Lease. Within ten (10) days after Landlord’s written request, Tenant shall execute any documents required by
Landlord or the Holder to make this Lease subordinate to any lien of the Encumbrance. If Tenant fails to do so, then in addition to such failure constituting a default by Tenant, it shall be deemed that this Lease is so subordinated to such
Encumbrance. Notwithstanding anything to the contrary in this Section, Tenant hereby attorns and agrees to attorn to any entity purchasing or otherwise acquiring the Premises at any sale or other proceeding or pursuant to the exercise of any other
rights, powers or remedies under such encumbrance. 
 This Lease constitutes a sublease under that certain Ground Lease dated March 5,
1999 (the “Existing Ground Lease”) between The Sobrato 1979 Revocable Trust, As Amended (“Master Landlord”), as landlord and Landlord, as tenant, covering all of the real property within the Project, a copy which has been
provided to Tenant, and under the Parcel Lease described in the next sentence. In connection with the subdivision of the Project as contemplated by Section 2.0 above, it is anticipated that a separate Parcel Lease (as defined in the Existing
Ground Lease) will be entered into between Master Landlord, as landlord, and Landlord, as tenant, for the lot within which the Building will be constructed. As used in this Lease, “Master Lease” shall mean the Existing Ground Lease, until
such time as the Parcel Lease is entered into, and thereafter shall mean the Parcel Lease. Notwithstanding this Section 21.T above, concurrently with the execution of this Lease by Landlord and Tenant, Landlord and Tenant shall execute in
recordable form, and Landlord shall cause Master Landlord to execute in recordable form, the Subordination, Nondisturbance and Attornment Agreement attached hereto as Exhibit “G” (the “SNDA”). Landlord shall cause the SNDA
to be recorded at Landlord’s cost in the Official Records of San Mateo County, California within five (5) days after this Lease is executed by Landlord and Tenant. Similarly, in connection with the Parcel Lease, within ten (10) days
after Landlord’s request, Landlord and Tenant shall execute in recordable form, and Landlord shall cause Master Landlord to execute in recordable form, a Subordination, Nondisturbance and Attornment Agreement substantially in the form of the
SNDA (the “Revised SNDA”), modified to refer to the Parcel Lease, Memorandum of Parcel Lease to be recorded in connection with the Parcel Lease and the revised Premises description, 

  

 -40- 

 
rather than the Original Ground Lease, the Memorandum of Ground Lease referenced in the SNDA and the original Premises described in this Lease. Landlord
shall cause the Revised SNDA to be recorded at Landlord’s cost in the Official Records of San Mateo County, California immediately after recordation of the Memorandum of Lease recorded for the Parcel Lease. 
 Notwithstanding the foregoing, Tenant shall not be required to subordinate its interest under this Lease unless (i) such subordination does not
materially increase Tenant’s obligations, or materially decrease its rights under this Lease, and (ii) Landlord first obtains from the holder of the mortgage, deed of trust, or other instrument of security to which this Lease is to become
subordinated a written agreement that provides substantially that as long as Tenant performs its obligations under this Lease, no foreclosure of, deed given in lieu of foreclosure of, or sale under the encumbrance, and no steps or procedures taken
under the encumbrance, shall affect Tenant’s rights hereunder. 
 U. Survival of Indemnities: All indemnification, defense, and
hold harmless obligations of Landlord and Tenant under this Lease shall survive the expiration or sooner termination of the Lease. 
 V.
Time: Time is of the essence hereunder. 
 W. Transportation Demand Management Programs: Should a government agency or
municipality require Landlord to institute TDM (Transportation Demand Management) facilities and /or program, Tenant agrees that the cost of TDM imposed facilities required on the Premises, including but not limited to employee showers, lockers,
cafeteria, or lunchroom facilities, shall be paid by Tenant. Further, any ongoing costs or expenses associated with a TDM program which are required for the Premises and not provided by Tenant, such as an on-site TDM coordinator, shall be provided
by Landlord with such reasonable costs being included as additional rent and reimbursed to Landlord by Tenant within thirty (30) days after demand. If TDM facilities and programs are instituted on a Project wide basis, Tenant shall pay its
proportionate share of such costs in accordance with Section 8 above. 
  

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 IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease on the day and year first above written,

  

									
	 Landlord: SOBRATO INTERESTS III
 a California
Limited Partnership
	 		 		 	 Tenant: SIEBEL SYSTEMS, INC.
 a Delaware Corporation

					
	By: 	 	/s/ John M. Sobrato	 		 	By:	 	 
					
	Its:	 	General Partner	 		 	Its:	 	 
	
	Master Landlord: THE SOBRATO 1979 REVOCABLE TRUST
					
	By: 	 	/s/ John M. Sobrato	 		 		 	
	Its:	 	Trustee	 		 		 	

  

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 FIRST AMENDMENT TO LEASE 
 Building 1- 2215 Bridgepointe Parkway, San Mateo 
 This first amendment to lease (“Amendment”) is made this 11th day of June, 1999 (the “Effective Date”)
by and between SOBRATO INTERESTS III, a California limited partnership having an address at 10600 N. De Ann Blvd., Suite 200, Cupertino, California 95014 (“Landlord”) and SIEBEL SYSTEMS, INC., a Delaware corporation hiving its
principal place of business at 1855 South Grant Street, San Mateo, California 94402 (“Tenant”). 
 WITNESSETH 

 WHEREAS Landlord and Tenant entered into a lease dated March 11, 1999, (the “Lease”) for a building to be
constructed at 2215 Bridgepointe Parkway in the location labeled as Building 1 on Exhibit “A” attached hereto (“Premises”); and 
 WHEREAS Landlord and Tenant are concurrently entering into a lease for Building 3 (the “Building 3 Lease”); and 
 WHEREAS Landlord and Tenant wish to accelerate the construction of the Premises in exchange for a reduction in the Base Monthly Rent and a modification of the security deposit provisions to provide for
individual letters of credit for this Lease, the Building 2 Lease and the Building 3 Lease; 
 NOW, THEREFORE, in order to
effect the intent of the parties as set forth above and for good and valuable consideration exchanged between the parties, the Lease is amended as of the Effective Date as follows: 
  

	1.	The first sentence of Section 4.A is modified to provide that the Lease Term shall be automatically extended so as to he coterminous with the Expiration Date of the Building 3
Lease. Rent during such extended term shall be at the Base Monthly Rent in effect immediately prior to such extended term. The second sentence of 4.A is deleted is replaced by the following: “Notwithstanding the foregoing, in no event shall the
Commencement Date be less than forty five (45) days following the Commencement Date for Building 2.” 

  

	2.	The anticipated Commencement Date for the Premises referenced in Section 4.A is accelerated from August 1, 2001 to September 15, 2000. 

  

	3.	The Base Monthly Rent referenced in Section 4.A is decreased from the sum of Three Hundred Thirty Four Thousand Three Hundred Fifty Five Dollars ($334,355.00) to Three Hundred
Twenty Thousand Sixty Four Dollars ($320,064.00). 

  

	4.	The Base Monthly Rent referenced in Section 4.B is reduced from Two and 363/1000 ($2.363) per square foot to Two and 262/1000 ($2.262) per square foot.

  

	5.	Section 4.D is replaced in its entirety by the following: 

 Security Deposit: 
 (i) Amount: Tenant shall deposit with landlord a letter of credit (“Letter of Credit”) in a form reasonably acceptable to Landlord in the amount of Eight Million Pour Hundred Thousand Dollars
($8,400,000.00) to secure Tenant’s obligation to complete Tenant Improvements in the Building. Upon Landlord’s receipt of evidence reasonably satisfactory to Landlord of lien free completion of the Tenant Improvements and that Tenant has
fully paid for the cost of all of Tenant Improvements for the Building, the Letter of Credit shall be cancelled and returned to Tenant by Landlord. Notwithstanding the foregoing, in the event Tenant elects to defer construction on a portion of the
non-core Tenant Improvements in the Building (as provided further and restricted in Section 5.B), Landlord shall not require Tenant to continue to post the Letter of Credit after payment in full for all other Tenant Improvements associated with
the Building. 
 (ii) Use by Landlord: Landlord shall be entitled to draw against the full amount of the Letter of
Credit at any time provided only that Landlord certifies to the issuer of the Letter of Credit that Tenant has failed to make a payment for Tenant Improvement costs as provided in 5.F, that Tenant has failed to timely renew or extend the Letter of
Credit as required by this subsection (ii), or that Tenant has failed to amend the Letter of Credit or obtain a new Letter of Credit as required by this subsection (ii) and such failure has not been cured within ten (10) days
following Landlord’s notice to Tenant. Tenant shall keep the Letter of Credit in effect at all tunes prior to payment in full for the Tenant Improvements for the Building. At least sixty (60) days prior to expiration of any Letter of
Credit, the term thereof shall be renewed or extended for a period until Tenant has paid in full for the Tenant Improvements for the Building. Subject to the notice requirement and cure period provided herein, Tenant’s failure to so renew or
extend the Letter of Credit shall be a material default of this Lease by Tenant entitling Landlord to draw down on thy entire amount of the Letter of Credit. Any amounts drawn on the Letter of Credit shall be used to pay for the cost of the Tenant
Improvements. In the event the Letter of Credit is drawn by Landlord, and the proceeds used to pay for the completion of the Tenant Improvements in the Building, after Landlord’s completion of the Tenant Improvements in the Building, Landlord
shall refund to Tenant any excess proceeds from the Letter of Credit. In the event of termination of Landlord’s interest in this Lease, Landlord may deliver the Letter of Credit to Landlord’s successor in interest in the Premises and
thereupon be relieved of further responsibility with respect to the Letter of Credit. Except as provided herein, no other security deposit shall be required by Tenant. 
 (iii) Letter of Credit Fee: Landlord and Tenant agree to share equally in the fee charged to provide the Letter of Credit. In no
event, however, shall Landlord’s share of the fee exceed the sum of Forty Two Thousand Dollars ($42,000.00) per annum. 
  

	6.	 The seventh through the ninth sentence, of Section 5.A beginning “Landlord shall contract for the installation” shall be replaced In its entirety by
“Landlord’s affiliated construction company, Sobrato Construction Corporation shall act as the general contractor for the 

  

 -2- 

	 	 
Building Shell and shall begin construction of the Building Shell immediately following the Effective Date. Upon completion of the Tenant Improvement Plans,
Landlord and Tenant shall select a general contractor (“General Contractor”) on the basis of a competitive bid of the cost to construct the Tenant Improvements. Thereafter, Landlord shall cause the General Contractor to complete
construction of the Tenant Improvements. Landlord and Sobrato Construction shall use commercially reasonable efforts to ensure effective coordination between the General Contractor selected to construct the Tenant Improvements and Sobrato
Construction Corporation.” 

  

	7.	The first sentence of Section 5.J is replaced by “Sobrato Construction Corporation and General Contractor shall each procure (as a cost of the Budding Shell or the Tenant
improvements as applicable) a “Broad Form” liability insurance policies in the amount of Three Million Dollars ($3,000,000.00).” 

  

	8.	The first three sentences of Section 5.K are replaced by “After the Building Shell and Tenant Improvements are Substantially Complete, Landlord shall cause Sobrato
Construction Corporation and/or the General Contractor to immediately correct any construction defect or other “punch list” item which Tenant brings to Landlord’s attention. All such work shall be performed so as to reasonably
minimize the interruption to Tenant and its activities on the Premises. Sobrato Construction Corporation shall provide a standard contractor’s warranty with respect to the Building Shell for one (1) year from the Commencement Date. The
General Contractor shall provide a standard contractor’s warranty with respect to the Tenant Improvements for one (1) year from the Commencement Date.” 

  

	9.	The completion date for the Tenant Improvement Plans referenced in Section 5.B is accelerated from October 1, 2000 to November 15, 1999. 

  

	10.	The Termination Date referenced in Section 5.G s accelerated from August 1, 2002, until September 15, 2001. 

  

	11.	All defined term shall have the same meanings as in the Lease, except as otherwise stated in this Amendment. 

  

	12.	Except as hereby amended, the Lease and all of the terms, covenants and conditions thereof shall remain unmodified and in full force and effect. In the event of any conflict or
inconsistency between the terms and provisions of this Amendment and the terms and provisions of the Lease, the terms and provisions of this Amendment shall prevail. 

  

 -3- 

 IN WITNESS WHEREOF, the parties hereto have set their hands to this Amendment as of the day and date
first above written. 
  

									
	 Landlord
 SOBRATO INTERESTS
III
 a California Limited Partnership
	 		 		 	 Tenant
 SEIBEL SYSTEMS, INC.
 a Delaware Corporation

					
	By:	 	/s/ John M. Sobrato	 		 	By:	 	/s/ Jeffrey T. Armann
	Its:	 	General Partner	 		 	By:	 	Director, Legal Affairs

  

 -4- 

 SECOND AMENDMENT TO LEASE 
 This second amendment to lease (“Amendment”) is made this 31st day of July, 2000 (“Effective Date”) by and between Sobrato Interests III, a California limited partnership having an
address at 10600 N. De Anza Blvd., Suite 200, Cupertino, California 95014 (“Landlord”) and Siebel Systems, Inc., a Delaware corporation having its principal place of business at 165 South Grant Street, San Mateo, CA 94402 California
(“Tenant”). 
 WTTNESSETH 
 WHEREAS landlord and Tenant entered Into a lease dated March 11, 1999, and a First Amendment to Leave dated June 11, 1999 (the “Lease) for the premises (“Premises”) located at 2215 Bridgepointe
Parkway, San Mateo, California; and 
 WHEREAS Landlord and Tenant wish to memorialize the Lease Commencement date. 
 NOW THEREFORE, in order to effect the intent of the parties as set forth above and for good and valuable consideration exchanged between the
parties, the Lease is amended as of the Effective Pate as follows: 
  

	 	1.	The Lease Commencement date shall be July 5, 2000 

  

	 	2.	All defined terms shall have the sane meanings as in the Lease, except as otherwise stated in this Amendment. 

  

	 	3.	Except as hereby amended, the Lease and all of the teems, covenants and conditions thereof shall remain unmodified and in full force and effect. In the event of any conflict or
inconsistency between the terms and provisions of this First Amendment and the terms and provisions of the Lease, the terms and provisions of this First Amendment shall prevail. 

 IN WITNESS WHEREOF, the parties hereto have set their hands to this Amendment as of the day and date first above written. 
  

									
	 Landlord
 Sobrato Interests III,

 a California limited partnership
	 		 	 Tenant
 Siebel Systems,
Inc.
 a Delaware Corporation

					
	By:	 	/s/ John M. Sobrato	 		 	By:	 	/s/ Linda Jansen
	Its:	 	General Partner	 		 	Its:	 	Vice President, Facilities & Real Estate

 THIRD AMENDMENT TO LEASE 
 This Third Amendment To Lease (“Third Amendment”) is made and entered into as of Aug. 11, 2006 (, (the “Effective Date”) by and
between Sobrato Interests III, a California Limited Partnership, (“Landlord”), Oracle USA, Inc., a Colorado Corporation, as successor in interest to Siebel Systems, Inc. (“Siebel”), and Oracle Corporation, a Delaware
Corporation, (“Guarantor”). 
 RECITALS 
 A. Landlord and Siebel previously entered into that certain Lease dated March 11, 1999 (the “Original Lease”), regarding Landlord’s lease to Siebel of the property commonly known as 2215
Bridgepointe Parkway, San Mateo, California, as more particularly described in the Lease (the “Premises”). 
 B. The Original Lease
has been amended by that certain First Amendment to Lease dated as of June 11, 1999 (the “First Amendment”) and by that certain Second Amendment to Lease dated as of July 31, 2000 (the “Second Amendment”) (the Original
Lease, as amended by the First Amendment and the Second Amendment, being referred to herein as the “Lease”). 
 C. On or about
January 31, 2006, Siebel ceased trading as a publicly-owned company and became a subsidiary of Guarantor as a result of a merger. 
 D.
In exchange for the consideration set forth herein, and pursuant to the terms of Lease, Landlord and Tenant have agreed to modify the terms and conditions of the Lease as set forth in this Third Amendment, in order to add the Guarantor under the
Lease. 
 NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows: 
 AGREEMENT 
  

	 	1.	GUARANTY 

 A. From the Effective Date, Guarantor
continually, absolutely, irrevocably, and unconditionally guarantees the full, faithful, and timely payment and performance by Tenant of all of Tenant’s obligations (including the timely payment of all amounts that Tenant may at any time owe)
under or arising out of the Lease, or any extensions, renewals, or modifications of the Lease, including payment and performance of all obligations of Tenant which may survive the expiration or termination of the Lease. The provisions contained in
this Section I are collectively referred to herein as the “Guaranty”. 

 B. Guarantor authorizes Landlord, without notice or demand and without affecting Guarantor’s
liability under the Guaranty, to: 
 (1) consent or agree to any extensions, accelerations, or other changes in the lime for any payment
provided for in the Lease, or consent or agree to any other alteration of any covenant, term, or condition of the Lease in any respect, and to consent to any assignment, subletting, or reassignment of the Lease; 
 (2) take and hold security for any payment provided for in the Lease or for the performance of any covenant, term, or condition of the Lease, or
exchange, waive, or release any security and Guarantor hereby waives any right to require Landlord to proceed against or exhaust any security including any rights under California Civil Code Sections 2899 and 1433; 
 (3) apply any security and direct the order or manner of its sale as Landlord may determine. Notwithstanding any termination, renewal, extension or
holding over of the Lease, or any demand for performance, or other enforcement of Guarantors obligations under the Guaranty, the Guaranty shall continue until all of the covenants and obligations on the part of Tenant to be performed have been fully
and completely performed by Tenant, and Guarantor shall not be released of any obligation or liability under the Guaranty so long as there is any claim against Tenant arising out of the Lease that has not been satisfied or performed by Tenant or
waived in writing for the express benefit of Guarantor; and 
 (4) renew, modify, amend or extend the Lease. The Guarantor waives its rights
under California Civil Code Section 2819. 
 C. The obligations of Guarantor under the Guaranty are independent of the obligations of
Tenant. Landlord may, at Landlord’s option, proceed immediately and directly against Guarantor, jointly or severally, in order to enforce the performance of the obligations of Tenant under the Lease. A separate action may be brought and
prosecuted against Guarantor, whether or not any action is first or subsequently brought against Tenant, or whether or not Tenant is joined in any action, and Guarantor may be joined in any action or proceeding commenced by Landlord against Tenant
arising out of, in connection with, or based upon the Lease. The liability of Guarantor under the Guaranty shall be primary and it shall not be necessary for Landlord, in order to enforce its rights hereunder, upon the default by Tenant, to first
give Guarantor notice of Tenant’s default or institute suit or pursue or exhaust its legal remedies against Tenant. 
 D,
“Tenant” as used in the Guaranty shall include all successors, assigns and other transferees of Tenant and any subsequent transferees of all or any part of Tenant’s interest under the Lease and the Guarantor shall continue to remain
primarily liable and obligated for the full payment and performance by such successors, assigns and transferees of all obligations of the tenant under the Lease. 
 E. Termination of the Lease for Tenant’s default under the Lease shall not extinguish, release or, in any way, affect or diminish the obligations of Guarantor hereunder. In no event shall Landlord be obligated to
lease any of the premises identified in the Lease to Guarantor after such termination. Upon termination of the Lease, as a result of Tenant’s default thereunder, the Guaranty shall extend to the payment to Landlord of all damages payable by
Tenant. 
  

 -2- 

 F. Until all of the obligations of Tenant under the Lease are fully performed and observed, Guarantor
covenants that Guarantor: (i) shall have no right of subrogation against Tenant by reason of any payments or acts of performance by Guarantor in compliance with the obligations of Guarantor hereunder; and (ii) shall have no right to
enforce any remedy which Guarantor now or hereafter shall have against Tenant by reason of any one or more payments or acts of performance by Guarantor in compliance with the obligations of Guarantor hereunder. 
 G. Guarantor hereby waives: (i) all defenses based upon any legal disability of Tenant or any discharge or limitation of liability of Tenant, to
Landlord, whether consensual or arising by operation of law or any bankruptcy, insolvency or debtor-relief proceeding or from any other cause; (ii) the right to require Landlord to proceed against Tenant or to pursue any other remedy in
Landlord’s power or any defense based upon an election of remedies by Landlord; (iii) any right to participate in any security now or later held by Landlord; (iv) all presentments, demands for performance, notice of nonperformance,
protests, notices of protest, dishonor or acceptance of the Guaranty and all notices of the existence, creation or incurring of new or additional obligations; and (v) all rights to be exonerated hereunder pursuant to the provisions of
California Civil Code Sections 2787 through 2855 and pursuant to any other statute or rule of law of similar import. 
 H. Guarantor is
relying upon its own knowledge and is fully informed with respect to Tenant’s financial condition. Guarantor assumes full responsibility for keeping fully informed of Tenant’s financial condition and of all other circumstances affecting
Tenant’s ability to perform its obligations to Landlord, and agrees that Landlord will have no duty to report to Guarantor any information Landlord receives about Tenant’s financial condition or any circumstances bearing on Tenant’s
ability to perform. 
 I. Any prior or subsequent guaranty by Guarantor or by any other guarantor of Tenant’s obligations to Landlord
shall not be deemed to be in lieu of or to supersede or terminate the Guaranty but shall be construed as an additional or supplementary guaranty unless otherwise expressly provided therein. The Guaranty shall remain in full force and effect,
notwithstanding that other guarantors from time to time may guarantee or otherwise become responsible for the performance of any of the terms, covenants and conditions of the Lease or are released from such guaranties. 
 J. Within twenty (20) days of written demand by Landlord, Guarantor shall deliver to Landlord and to any prospective purchaser, mortgagee and/or
beneficiary under a deed of trust, or other lender designated by Landlord, an estoppel certificate, executed and acknowledged by Guarantor, to the effect that the Guaranty is in full force and effect and has not been amended or terminated; provided
that Guarantor shall not be obligated to provide more than two (2) such estoppel certificates per calendar year. Guarantor shall also certify such other matters relating to the Lease to Guarantor’s actual knowledge, the premises leased
pursuant to the Lease or the Guaranty as may be reasonably requested by a lender making a loan to Landlord or a purchaser of any of such premises front Landlord. 
  

 -3- 

 K. The Guaranty shall remain and continue in full force and effect, notwithstanding: (1) the
commencement or continuation of any case, action, or proceeding by, against or concerning Tenant, under any federal or state bankruptcy, insolvency, or other debtor’s relief law, including, without limitation: (x) a case under
Title 11 of the United States Code concerning Tenant, whether under Chapter 7, 11 or 13 of such Title or under any other Chapter, or (y) a case, action or proceeding seeking Tenant’s financial reorganization or an arrangement
with any of Tenant’s creditors; (ii) the voluntary or involuntary appointment of a receiver, trustee, keeper or other person who takes possession of substantially all of Tenant’s assets or of any asset used in Tenant’s business
on any portion of the premises leased pursuant to the Lease, regardless of whether such appointment occurs as a result of insolvency or other cause; or (iii) the execution of an assignment far the benefit of creditors of substantially all
assets of Tenant available by law for the satisfaction of judgment creditors. 
 L. In the event any action or proceeding should be commenced
between Landlord and Guarantor to enforce or interpret any of the terms, covenants or conditions of the Guaranty, the prevailing party in such action or proceeding shall be entitled to recover from other party, in any such action or proceeding in
which it shall prevail, all reasonable attorneys’ fees, costs and expenses. 
 M. The Guaranty may not be changed, waived, discharged or
terminated orally or by course of conduct, but rather only by an instrument in writing signed by the party against whom enforcement of the charge, waiver, discharge or termination is sought. 
 N. The Guaranty shall be governed by and construed in accordance with the laws of the State of California. Guarantor hereby submits to the legal
jurisdiction of the State of California and to the service of process of any court of the State of California. The parties agree that all disputes shall be determined by resort to the courts of California of competent jurisdiction, with venue in San
Francisco County. 
 O. The Guaranty shall be binding upon Guarantor and Guarantor’s successors, and assigns, and shall inure to the
benefit of Landlord and Landlord’s successors and assigns. Landlord may, without notice, assign the Guaranty, the Lease, or the rents and other sums payable under the Lease, in whole or in part, and encumber or otherwise hypothecate all or any
of the foregoing. 
  

	 	2.	LIMITATION OF AMENDMENT. 

 Any capitalized terms
used herein that are not specifically defined shall have the same meaning as set forth in the Lease. Except as otherwise modified by this Third Amendment, all other terms and conditions of the Lease as amended remain unchanged and in full force and
effect. In the event of any conflict between the provisions of this Third Amendment and the provisions of other portions of the Lease, the provisions of this Third Amendment shall control All references herein to the Lease shall be as amended by
this Third Amendment. 
  

	 	3.	COUNTERPARTS. 

 This Third Amendment may be executed
in one or mum counterparts, all of which shall be considered one and the same agreement, and each of which shall be deemed an original. 
  

 -4- 

 IN WITNESS WHEREOF, the Parties have executed this Third Amendment as of the date first written above.

  

			
	 SOBRATO INTERESTS III,
 a California
Limited Partnership

		
	By:	 	/s/ John M. Sobrato
	Its:	 	G.P.

  

			
	 ORACLE USA, INC.,
 a Colorado Corporation

		
	By:	 	/s/ Randall W. Smith
	Its:	 	VP, Real Estate and Facilities

  

			
	 ORACLE CORPORATION,
 a Delaware corporation

		
	By:	 	/s/ Randall W. Smith
	Its:	 	VP, Real Estate and Facilities

  

			
	THE SOBRATO 1979 REVOCABLE TRUST
		
	By:	 	/s/ John M. Sobrato
	Its:	 	Trustee
		 	Trustee

  

 -5- 

 LANDLORD CONSENT TO SUBLEASE 
 SOBRATO INTERESTS III (“Landlord”), as Landlord under that certain Lease (the “Lease”) dated as of 6/11/99,
    , as amended, by and between Landlord and ORACLE USA, INC. (as successor-in-interest to Siebel Systems, Inc.) (“Tenant”), as Tenant, subject to and specifically conditioned upon the following terms and
conditions hereby grants its consent to the Sublease dated as of 9/6/07, 2007, made by and between the Tenant, as sublandlord, and NEUROGESX, INC. (“Subtenant”), as subtenant, a copy of which is attached as Exhibit A (“the
Sublease”), covering that certain premises (the “Premises”) consisting of approximately 26,386 rentable square feet in the building commonly known as Bridgepointe Building I, located at 2215 Bridgepointe Parkway, San Mateo,
California. 
 As conditions to the consent of Landlord to the Sublease, it is understood and agreed as follows: 
 1. No Release. This Consent to Sublease shall in no way release the Tenant or any person or entity claiming by, through or under Tenant, including
Subtenant, from any of its covenants, agreements, liabilities and duties under the Lease, as the same may be amended from time to time, without respect to any provision to the contrary in the Sublease. 
 2. Specific Provisions of Lease and Sublease. This Consent to Sublease consenting to a sublease to Subtenant does not constitute approval by
Landlord of any of the provisions of the Sublease document or agreement thereto or therewith; nor shall the same be construed to amend the Lease in any respect, any purported modifications being solely for the purpose of setting forth the rights and
obligations as between Tenant and Subtenant, but not binding Landlord. The Sublease is, in all respects, subject and subordinate to the Lease, as the same may be amended, and Landlord shall not be bound by any restrictions in the Sublease on future
amendments or modifications to the Lease (such restrictions setting only the rights, obligations and restrictions as between Tenant and Subtenant). Furthermore, in the case of any conflict between the provisions of this Consent to Sublease or the
Lease, as the case may be, shall prevail unaffected by th e Sublease. Furthermore, any amendments to the Sublease shall be subject to the prior written consent of Landlord, and all actions and other matters requiring the consent or approval of
Tenant under the Sublease shall also require the consent or approval, as applicable, of Landlord. 
 3. Limited Consent. This Consent
to Sublease does not and shall not be construed or implied to be a consent to any other matter for which Landlord’s consent is required under the Lease, including, without limitation, any Alterations under the Lease whether or not future
Alterations are discussed or contemplated by the Sublease. Any monument signage shall require the approval of Landlord, which shall not be unreasonably withheld. If Alterations are required by the Subtenant including Alterations contemplated by the
Sublease, Tenant shall submit, or cause to be submitted, the plans and other items required by Article 7 of the Lease including all the Plans described in Section 15.2(a) of the Sublease, for approval by Landlord. If Landlord approves the
Initial Subtenant Alterations or subsequent Subtenant Alterations as defined in the Sublease, then all of the following shall apply (i) all such Alterations shall be constructed in accordance with, and there shall be compliance with all
requirements of, Article 7 of the Lease and any other provisions of the Lease applicable thereto; (ii) such Alterations shall be removed at the Expiration or earlier termination of the Lease and the Premises restored as provided in 

 Article 6 of the Lease; and (iii) upon completion of such Alterations all items required under
Section 7.A of the Lease as well as all items required to be delivered by Subtenant to Tenant under Section 15.2 (a) of the Sublease, shall be delivered to Landlord. Landlord shall have no liability to Tenant, Subtenant, or any third
parties arising out of its approval of any Alterations, and Landlord’s future approval is not intended to and shall not include any representation that such Alterations are safe, comply with laws or otherwise fit for its intended use.

 4. Tenant’s Continuing Liability. Tenant shall be liable to Landlord for any default under the Lease, whether such default is
caused by Tenant or Subtenant or anyone claiming by or through either Tenant or Subtenant, but the foregoing shall not be deemed to restrict or diminish any right which Landlord may have against Subtenant pursuant to the Lease, in law or in equity
for violation of the Lease or otherwise, including, without limitation, the right to enjoin or otherwise restrain any violation of the Lease by Subtenant. 
 5. Default by Tenant under the Lease. If Tenant defaults under the Lease, Landlord may elect to receive directly from Subtenant all sums due or payable to Tenant by Subtenant pursuant to the Sublease. Upon
written notice from Landlord, Subtenant shall thereafter pay to Landlord any and all sums due or payable under the Sublease. In such event, Tenant shall receive from Landlord a corresponding credit for such sums against any payments then due or
thereafter becoming due from Tenant. Notwithstanding the foregoing, the acceptance by Landlord of any such payments from Subtenant shall not release Tenant from any obligations or liabilities under the Lease, constitute an attornment by Subtenant to
Landlord or impose any obligation or liability on Landlord under the Sublease. 
 Furthermore, Subtenant’s payment to Landlord pursuant
to such election shall not create or evidence any direct landlord tenant relationship between Subtenant and Landlord, and Landlord may exercise all remedies to terminate the Lease (including the termination of Subtenant’s possession of the
Premises) in the event of any event of default by Tenant, notwithstanding its receipt of any payment from Subtenant pursuant to Landlord’s election, unless the receipt of such payment completely cures Tenant’s default. The acceptance of a
payment from Subtenant pursuant to such election shall not affect Landlord’s right to its remedies with regard to all defaults remaining uncured after such payment. 
 6. Termination of Lease. If at any time prior to the expiration of the Term of the Sublease the Lease shall terminate or be terminated for any reason, the Sublease shall simultaneously terminate regardless of
whether Landlord has received payments directly from Subtenant as described in Section 5 above. However, Subtenant agrees, at the election and upon written demand of Landlord, and not otherwise, to attorn to Landlord for the remainder of the
term of the Sublease, such attornment to be upon all of the terms and conditions of the Sublease, including all provisions of the Lease applicable to the Sublease. The foregoing provisions of this paragraph shall apply notwithstanding that, as a
matter of law, the Sublease may otherwise terminate upon the termination of the Lease and shall be self-operative upon such written demand of the Landlord, and (other than the written demand described in the foregoing sentence) 

 
no further instrument shall be required to give effect to said provisions. Upon the reasonable demand of Landlord, however, Subtenant agrees to execute, from
time to time but no more than once per 12 month period, documents in confirmation of the foregoing provisions of this paragraph satisfactory to Landlord in which Subtenant shall acknowledge such attornment and shall set forth the terms and
conditions of its tenancy. In the event of any such election by 
 Landlord, Landlord will not be (a) liable for any rent paid by
Subtenant to Tenant more than one month in advance of the written demand described above, or any security deposit paid by Subtenant to Tenant, unless same has been transferred to Landlord by Tenant; (b) liable for any act or omission of Tenant
under the Lease, Sublease or any other agreement between Tenant and Subtenant or for any default of Tenant under any such documents which occurred prior to the effective date of the attornment; (c) subject to any defenses or offsets that
Subtenant may have against Tenant which arose prior to the effective date of the attornment; (d) bound by any changes or modifications made to the Sublease without the written consent of Landlord, (e) obligated in any manner with respect
to the transfer, delivery, use or condition of any furniture, equipment or other personal property in the Sublet Premises which Tenant agreed would be transferred to Subtenant or which Tenant agreed could by used by the Subtenant during the term of
the Sublease, or (f) liable for the payment of any improvement allowance, or any other payment, credit, offset or amount due from Tenant to Subtenant under the Sublease. 
 7. Sublease Profits. Provided the Sublease remains in full force and effect, Tenant agrees to pay to Landlord each month along with the base
monthly rent due under the Lease, any sums due Pursuant to Section 17.B of the Lease. For the purposes hereof, 100% of all proceeds from further subleasing or assignment by Subtenant which constitute excess rent calculated pursuant to
Section 9.1(x) of the Sublease shall be used in calculating any sums due Landlord from Tenant under section 1 7.B, such that if and to the extent that the amount payable to Subtenant under any further subleasing or assignment by Subtenant
exceeds the amount payable by Tenant under the Lease, Landlord will be entitled to fifty percent (50%) of such excess (as an example, assuming that the amount payable under the Lease is $2.00 per rentable square foot, if Subtenant further
subleases all or any portion of the Sublet Premises for $3.00 per rentable square foot, Landlord will be entitled to fifty percent (50%) of the excess over the amount payable under the Lease, or $.50 per rentable square foot). 
 8. No Waiver; No Privity. Nothing herein contained shall be deemed a waiver of any of the Landlord’s rights under the Lease. In no event,
however, shall Landlord be deemed to be in privity of contract with Subtenant or owe any obligation or duty to Subtenant under the Lease or otherwise, any duties of Landlord under the Lease being in favor of, for the benefit of and enforceable
solely by Tenant. 
 9. Notices. Subtenant agrees to promptly deliver a copy to Landlord of all notices of default, notices which,
with the passing of time would become a default, and notices regarding matters for which Landlord’s approval would be required and which are sent to Tenant under the Sublease, and Tenant agrees to promptly deliver a copy to Landlord of all
notices of default, notices which, with the passing of time would become a default, and notices regarding matters for which Landlord’s approval would be required and which are sent to Subtenant or received by Tenant under the Sublease. All
copies of any such notices shall be delivered personally or sent by United States registered or certified mail, postage prepaid, return receipt requested, to Landlord. 

 10. Authority To Execute Agreement. Each individual executing this Consent on behalf of a
corporation or limited liability company represents that he or she is duly authorized to execute and deliver this Consent on behalf of the corporation or limited liability company and to bind such corporation or limited liability company, as
applicable, to the terms hereof. 
 11. Insurance. Concurrently with Subtenant’s execution of this Consent, Subtenant shall
provide Landlord with certificates of insurance evidencing, to Landlord’s satisfaction, the maintenance by Subtenant of all insurance required to be maintained by Subtenant under the Sublease. Subtenant shall maintain such insurance throughout
the term of the Sublease and shall cause Landlord and Tenant to be named as additional insureds thereunder. 
 12. Brokerage Commissions
and Indemnity. Notwithstanding anything set forth in the Sublease, Landlord has no obligation to pay and will not pay commissions or fees to any broker or finder in regard to the Sublease or Landlord’s consent thereto. Tenant and Subtenant
covenant and agree that under no circumstances shall Landlord be liable for any brokerage commissions or similar fees in connection with the subletting consented to hereunder, and both Tenant and Subtenant agree to indemnify and hold Landlord
harmless from and against same and any costs or expenses (including, but not limited to, attorneys’ fees and costs) incurred by Landlord in resisting any claim for any such brokerage commissions or similar fees. 
 13. Tenant’s Representations. Tenant represents and warrants that it has not failed to disclose to Landlord any information which, if known
by Landlord, might provide grounds for Landlord to withhold its consent to the subletting described herein. 
 14. Subtenant’s
Representations. Subtenant represents and warrants to Landlord that it has not deliberately withheld from Landlord any information which, if known by Landlord, might provide grounds for Landlord to withhold its consent to the subletting
described herein. Further, Subtenant acknowledges that it has been provided with a copy of the Lease, and represents and warrants to Landlord that it has read the entire Lease and fully understands the obligations and responsibilities as
“Tenant” under the Lease. 
 15. Tenant. For valuable consideration, the receipt of which is hereby acknowledged, Tenant
agrees that any breach by Tenant or Subtenant of this Consent shall constitute a default by Tenant under the Lease. 
 16. Successors and
Assigns; Amendments to Consent. This Consent shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, subject to all restrictions contained in the Lease, the Sublease and this Consent with
respect to assignment, sublettings and other transfers. This Consent may be amended only in writing signed by all parties hereto. 
 17.
No Transfer. Subtenant shall not further sublease the Premises, assign its interest as the Subtenant under the Sublease or otherwise transfer its interest in the Premises or the Sublease to any person or entity without the written consent of
Landlord, which Landlord may withhold as provided in Article 17 of the Lease. The provisions of Section 17.E of the Lease shall apply as to any further subleasing or assignment by Subtenant. 

 18. Payment of Fees and Expenses. Tenant shall pay to Landlord the legal fees and expenses
incurred by Landlord in granting this request for consent as provided in Section 17.A of the Lease. 
  

			
	 Landlord

	
	 SOBRATO INTEREST III,
 a California limited
partnership

		
	 By:
	 	 

	 Print Name:
	 	JOHN M. SOBRATO
	 Its:
	 	GP.
	
	 Tenant

	
	ORACLE USA, INC., a Colorado corporation
		
	 By:
	 	 

	 Print Name:
	 	Randall W. Smith
	 Its:
	 	VP Real Estate & Facilities
	
	 Subtenant

	
	 NEUROGESX, INC., a Delaware corporation

		
	 By:
	 	 

	 Print Name:
	 	Stephen Ghiglieri
	 Its:
	 	CFO

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