Document:

Articles of Supplementary Establishing and Fixing The Rights and Preferences

 Exhibit 4.1 
  

U.S. RESTAURANT PROPERTIES, INC. 
  
 ARTICLES SUPPLEMENTARY 
 ESTABLISHING
AND FIXING THE RIGHTS AND PREFERENCES 
 OF 
 7.5% SERIES C REDEEMABLE CONVERTIBLE PREFERRED STOCK 
  
 U.S. Restaurant Properties, Inc., a Maryland corporation (the “Corporation”), hereby certifies to the State Department of Assessments and Taxation of the State of Maryland that, pursuant to the authority
conferred upon the Board of Directors of the Corporation by Article IV of the Corporation’s Restated Articles of Incorporation, as amended to the date hereof and as the same may be amended hereafter from time to time (the “Articles of
Incorporation”), the Board of Directors (the “Board”), by resolution adopted on August 9, 2004, duly divided and classified unissued shares of Preferred Stock into a series designated as “7.5% Series C Redeemable Convertible
Preferred Stock” of the Corporation. The description of the 7.5% Series C Redeemable Convertible Preferred Stock, including the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends, qualifications,
and terms and conditions of redemption thereof, as set by the Board, are as set forth in these Articles Supplementary. 
  
 Section 1. Number of Shares and Designation. 
  
 The shares of such series shall be designated “7.5% Series C Redeemable Convertible Preferred Stock” (the “Series C Preferred Stock”)
and the number of shares constituting such series shall be 7,500,000. The designations, powers, preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions, of the Series C Preferred
Stock shall be subject in all cases to the provisions of Article VII of the Articles of Incorporation. 
  
 Section 2. Definitions. 
  
 Unless the context otherwise requires, the terms defined in this Section shall have, for all purposes of these Articles Supplementary, the meanings herein
specified (with terms defined in the singular having comparable meanings when used in the plural). 
  
 “Articles of Incorporation” shall mean the Corporation’s Restated Articles of Incorporation, as amended to the date hereof and as the same
may be amended hereafter from time to time. 
  
 “Board of
Directors” shall mean the Board of Directors of the Corporation or any committee authorized by such Board of Directors to perform any of its responsibilities with respect to the Series C Preferred Stock. 
  
 “Beneficiary” shall have the meaning set forth in Article VII of
the Articles of Incorporation. 

 “Business Day” shall mean any day other than a Saturday, Sunday or a day on which state or
federally chartered banking institutions in New York, New York are not required to be open. 
  
 “Code” shall mean the Internal Revenue Code of 1986, as amended. 
  
 “Common Stock” shall mean the common stock, par value $.001 per share, of the Corporation. 
  
 “Constituent Person” shall have the meaning set forth in Section
7(e) hereof. 
  
 “Conversion Price” shall mean the
conversion price per share of Common Stock for which each share of Series C Preferred Stock is convertible, as such Conversion Price may be adjusted pursuant to Section 7(d). The initial conversion price shall be $19.50 (equivalent to a conversion
rate of 1.28205 shares of Common Stock for each share or Series C Preferred Stock. 
  
 “Corporation” shall mean U.S. Restaurant Properties, Inc., a Maryland corporation. 
  
 “Current Market Price” of publicly traded shares of Common Stock or any other class of shares of capital stock or other security of the
Corporation or any other issuer for any day shall mean the last reported sales price, regular way, on such day or, if no sale takes place on such day, the average of the reported closing bid and asked prices on such day, regular way, in either case
as reported on the New York Stock Exchange (“NYSE”) or, if such security is not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such security is listed or admitted for trading or, if not
listed or admitted for trading on any national securities exchange, on the Nasdaq National Market or, if such security is not quoted on such Nasdaq National Market, the average of the closing bid and asked prices on such day in the over-the-counter
market as reported by Nasdaq or, if bid and asked prices for such security on such day shall not have been reported through Nasdaq, the average of the bid and asked prices on such day as furnished by any NYSE member firm regularly making a market in
such security and selected for such purpose by the Chief Executive Officer of the Corporation or the Board of Directors. 
  
 “Dividend Payment Date” shall mean, with respect to each Dividend Period, the fifteenth (15th) day of the month following the month in which such Dividend Period has ended. The first Dividend Payment Date shall be April 15, 2005. 
  
 “Dividend Payment Record Date” shall mean the date designated by
the Board of Directors for the payment of dividends that is not more than 30 or less than 10 days prior to the applicable Dividend Payment Date. 
  
 “Dividend Period” shall mean the respective periods commencing on and including January 1, April 1, July 1 and October 1 of each year and ending
on and including the day preceding the first day of the next succeeding Dividend Period (other than the initial Dividend Period, which shall commence on the first day of the month following the Original Issue Date (unless the Original Issuance Date
is the first day of a calendar month, in which case the initial dividend shall commence on the Original Issuance Date) and end on and include March 31, 2005, and other than the Dividend Period during which any Series C Preferred Stock shall be

  

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redeemed pursuant to Section 5, which shall end on and include the date fixed for redemption with respect to the Series C Preferred Stock being redeemed).

  
 “DTC” shall have the meaning set forth in Section 10
hereof. 
  
 “Event” shall have the meaning set forth in
Section 6(d)(ii) hereof. 
  
 “Excess Stock” shall have
the meaning set forth in Article VII of the Articles of Incorporation. 
  
 “Fair Market Value” shall mean the average of the daily Current Market Prices of a share of Common Stock during the five (5) consecutive Trading Days selected by the Corporation commencing not more than 20 Trading Days before, and
ending not later than, the earlier of the day in question and the day before the “ex date” with respect to the issuance or dividend requiring such computation. The term “ex date” when used with respect to any issuance or
dividend, means the first day on which the Common Stock trades regular way, without the right to receive such issuance or dividend, on the exchange or in the market, as the case may be, used to determine that day’s Current Market Price.

  
 “Non-Electing Share” shall have the meaning set
forth in Section 7(e) hereof. 
  
 “Original Issue Date”
shall mean the first date on which the Series C Preferred Stock are issued and sold. 
  
 “Ownership Limit” shall have the meaning set forth in Article VII of the Articles of Incorporation. 
  
 “Parity Preferred” shall have the meaning set forth in Section 6(b) hereof. 
  
 “Preferred Directors” shall have the meaning set forth in Section 6(b) hereof. 
  
 “Preferred Dividend Default” shall have the meaning set forth in
Section 6(b) hereof. 
  
 “Preferred Stock” shall mean
the preferred stock, par value $.001 per share, of the Corporation. 
  
 “REIT” shall have the meaning set forth in Section 5(a) hereof. 
  
 “Securities” shall have the meaning set forth in Section 7(d)(iii) hereof. 
  
 “Series C Preferred Stock” shall have the meaning set forth in Section 1 hereof. 
  
 “set apart for payment” shall be deemed to include, without any action other than the following, the recording by
the Corporation in its accounting ledgers of any accounting or bookkeeping entry which indicates, pursuant to a declaration of dividends by the Board of Directors, the allocation of funds to be so paid on any series or class of shares of beneficial
interest of the Corporation. 
  

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 “Trading Day” shall mean any day on which the securities in question are traded on the NYSE, or
if such securities are not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such securities are listed or admitted, or if not listed or admitted for trading on any national securities exchange, on
the Nasdaq National Market, or if such securities are not quoted on such Nasdaq National Market, in the applicable securities market in which the securities are traded. 
  
 “Transaction” shall have the meaning set forth in Section 7(e) hereof. 
  
 “Transfer Agent” shall mean American Stock Transfer & Trust
Corporation, or such other agent or agents of the Corporation as may be designated by the Board of Directors or their designee as the transfer agent and registrar for the Series C Preferred Stock. 
  
 “Trust” shall mean the trust created pursuant to Article VII,
Section 7.2(G), and administered in accordance with the terms of, Article VII, Section 7.13 of the Articles of Incorporation. 
  
 Section 3. Dividends and Distributions. 
  
 (a) Subject to the preferential rights of the holders of any class or series of equity securities of the Corporation ranking senior to the Series C
Preferred Stock as to dividends, the holders of the then-outstanding Series C Preferred Stock shall be entitled to receive, when, as and if declared by the Board of Directors, out of funds legally available for the payment of dividends, cumulative
cash dividends at the rate of 7.5% per annum of the $25.00 liquidation preference per share of the Series C Preferred Stock (equal to a fixed amount of $1.875 per year per share of Series C Preferred Stock). Such dividends shall accrue and be
cumulative from and including the first day of the month following the Original Issue Date and shall be payable quarterly in arrears on each Dividend Payment Date, commencing April 15, 2005, with respect to each Dividend Period; provided,
however, that if any Dividend Payment Date is not a Business Day, then the dividend that would otherwise have been payable on such Dividend Payment Date may be paid on the next succeeding Business Day with the same force and effect as if paid
on such Dividend Payment Date, and no interest or additional dividends or other sums shall accrue on the amount so payable from such Dividend Payment Date to such next succeeding Business Day. The initial dividend payable on the Series C Preferred
Stock, which will cover the period from the first day of the month following the Original Issue Date (unless the Original Issuance Date is the first day of a calendar month, in which case the initial dividend shall commence on the Original Issuance
Date) through March 31, 2005, will be paid on April 15, 2005. The amount of the dividend payable on the Series C Preferred Stock for each full Dividend Period shall be $.46875 per share. The amount of any dividend payable on the Series C Preferred
Stock for any partial Dividend Period, including the initial Dividend Period, shall be prorated and computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends will be payable to holders of record as they appear in the
stockholder records of the Corporation at the close of business on the applicable Dividend Payment Record Date. Notwithstanding any provision to the contrary contained herein, each outstanding share of Series C Preferred Stock shall be entitled to
receive a dividend with respect to any Dividend Period equal to the dividend paid for such Dividend Period with respect to each other share of Series C Preferred Stock that is outstanding on such date. 
  

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 (b) No dividends on the Series C Preferred Stock shall be declared by the Board of Directors or paid or
set apart for payment by the Corporation at such time as the terms and provisions of any agreement of the Corporation, including any agreement relating to its indebtedness, prohibits such declaration, payment or setting apart for payment or provides
that such declaration, payment or setting apart for payment would constitute a breach thereof or a default thereunder, or if such declaration, or payment or setting apart for payment shall be restricted or prohibited by law. 
  
 (c) Notwithstanding anything contained herein to the contrary, dividends on
the Series C Preferred Stock shall accrue and be cumulative whether or not (i) the Corporation has earnings, (ii) there are funds legally available for the payment of such dividends or (iii) such dividends are declared. Accrued but unpaid dividends
on the Series C Preferred Stock will accumulate from and including the Dividend Payment Date on which they first become payable. No interest shall be payable in respect of any accrued but unpaid dividend on the Series C Preferred Stock. 

 
 (d) Except as provided in Section 3(f) below, no dividends shall be
declared or paid or set apart for payment and no other distribution of cash or other property may be declared or made, directly or indirectly, on or with respect to any other class or series of equity securities of the Corporation ranking, as to
dividends, on a parity with the Series C Preferred Stock, unless dividends on the Series C Preferred Stock for all past Dividend Periods and the then-current Dividend Period shall have been or contemporaneously are (i) declared and paid in cash or
(ii) declared and a sum sufficient for the payment thereof in cash is set apart for such payment. 
  
 (e) Except as provided in Section 3(f) below, unless full cumulative dividends on the Series C Preferred Stock for all past Dividend Periods and the
then-current Dividend Period shall have been or contemporaneously are (i) declared and paid in cash or (ii) declared and a sum sufficient for the payment thereof in cash is set apart for such payment, no dividends shall be declared or paid or set
apart for payment and no other distribution of cash or other property may be declared or made, directly or indirectly, on or with respect to any Common Stock or shares of any other class or series of equity securities of the Corporation ranking, as
to dividends, junior to the Series C Preferred Stock (other than (w) a dividend paid in Common Stock or in shares of any other class or series of equity securities ranking junior to the Series C Preferred Stock as to dividends or (x) a dividend paid
in options, warrants or rights to subscribe for or purchase Common Stock or shares of any other class or series of equity securities ranking junior to the Series C Preferred Stock as to dividends) for any period, nor shall any Common Stock or any
other shares of any other class or series of equity securities of the Corporation ranking, as to dividends, junior to the Series C Preferred Stock be redeemed, purchased or otherwise acquired (except for a redemption, purchase or other acquisition
of Common Stock made for purposes of the Corporation’s employee incentive or benefit plans) for any consideration and no other distribution of cash or other property may be made, directly or indirectly, on or with respect thereto (or any monies
be paid to or made available for a sinking fund for the redemption of any such shares) by the Corporation (except by conversion into or exchange for (y) other shares of any class or series of equity securities of the Corporation ranking junior to
the Series C Preferred Stock as to dividends or (z) options, warrants or rights to subscribe for or purchase other shares of any class or series of equity securities of the Corporation ranking junior to the Series C Preferred Stock as to dividends).

  

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 (f) When dividends are not paid in full (or a sum sufficient for such full payment is not so set apart)
upon the Series C Preferred Stock and the shares of any other class or series of equity securities ranking, as to dividends, on a parity with the Series C Preferred Stock, all dividends declared upon the Series C Preferred Stock and each such other
class or series of equity securities ranking, as to dividends, on a parity with the Series C Preferred Stock shall be declared pro rata so that the amount of dividends declared per share of Series C Preferred Stock and such other class or series of
equity securities shall in all cases bear to each other the same ratio that accumulated dividends, including accrued dividends on each share of Series C Preferred Stock and each share of such other class or series of equity securities, bear to each
other. 
  
 (g) Holders of Series C Preferred Stock shall not be
entitled to any dividend, whether payable in cash, property or shares, in excess of full accrued and cumulative dividends on the Series C Preferred Stock as provided herein. No interest, or sum of money in lieu of interest, shall be payable in
respect of any dividend payment or payments on the Series C Preferred Stock which may be in arrears. Any dividend payment on account of arrearages for any past Dividend Periods may be declared and paid at such time, if any, as may be fixed by the
Board of Directors, and shall first be credited against the earliest accrued but unpaid dividends due and payable with respect to such Series C Preferred Stock. 
  

(h) Except as provided in these Articles Supplementary, the Series C Preferred Stock shall not be entitled to participate in the earnings or assets of
the Corporation. 
  
 Section 4. Liquidation
Preference. 
  
 Upon any voluntary or involuntary liquidation,
dissolution or winding-up of the affairs of the Corporation, before any distribution or payment shall be made to holders of Common Stock or any other class or series of equity securities of the Corporation ranking, as to liquidation rights, junior
to the Series C Preferred Stock, the holders of Series C Preferred Stock then outstanding shall be entitled to be paid, out of the assets of the Corporation legally available for distribution to its stockholders, a liquidation preference of $25.00
per share of Series C Preferred Stock, plus an amount equal to any accrued and unpaid dividends to the date of payment. In the event that, upon any such voluntary or involuntary liquidation, dissolution or winding-up, the available assets of the
Corporation are insufficient to pay the amount of the liquidating distributions on all outstanding shares of Series C Preferred Stock and the corresponding amounts payable on all shares of other classes or series of equity securities of the
Corporation ranking, as to liquidation rights, on a parity with the Series C Preferred Stock in the distribution of assets, then the Series C Preferred Stock and each such other class or series of shares of equity securities ranking, as to
liquidation rights, on a parity with the Series C Preferred Stock shall share ratably in any such distribution of assets in proportion to the full, respective, preferential liquidating distributions to which they would otherwise be entitled. Written
notice of any such liquidation, dissolution or winding up of the Corporation, stating the payment date or dates when, and the place or places where, the amounts distributable in such circumstances shall be payable, shall be given by first class
mail, postage pre-paid, not less than 30 nor more than 60 days prior to the payment date stated therein, to each holder of record of Series C Preferred Stock at the respective addresses of such holder as the same shall appear on the shareholder
records of the Corporation. After payment of the full amount of the preferential liquidating distributions to 

  

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which the holders of the Series C Preferred Stock are entitled under this Section 4, such holders shall have no right or claim to any of the remaining assets
of the Corporation. The consolidation or merger of the Corporation with or into any other entity, or the sale, lease, transfer or conveyance of all or substantially all of the property or business of the Corporation, shall not be deemed to
constitute a liquidation, dissolution or winding-up, voluntary or involuntary, of the Corporation. 
  
 Section 5. Redemption. 
  
 (a) The Series C Preferred Stock shall not be redeemable by the Corporation prior to February 25, 2009 unless the Board of Directors determines that such
a redemption is necessary or advisable to preserve the status of the Corporation as a real estate investment trust (“REIT”) for United States federal income tax purposes, subject to the provisions below. 
  
 (b) On or after February 25, 2009, the Corporation, at its option, following
notice given in accordance with Section 5(g), may redeem the Series C Preferred Stock, in whole or in part, at any time or from time to time, for cash at a redemption price of $25.00 per share, plus all accrued and unpaid dividends thereon to and
including the date fixed for redemption, without interest. If fewer than all of the outstanding shares of Series C Preferred Stock are to be redeemed, the Series C Preferred Stock to be redeemed shall be redeemed pro rata (as nearly as may be
practicable without creating fractional shares), by lot or by any other equitable method determined by the Corporation that will not result in a violation of the Ownership Limit, provided that such method satisfies any applicable requirements of any
securities exchange on which the Series C Preferred Stock are then listed or any national quotation system on which the Series C Preferred Stock are then quoted. If such redemption is to be by lot and, as a result of such redemption, any holder of a
number of Series C Preferred Stock would become a holder of a number of Series C Preferred Stock in excess of the Ownership Limit because such holder’s Series C Preferred Stock were not redeemed, or were redeemed only in part, then, except as
otherwise provided in the Articles of Incorporation, the Corporation will redeem the requisite number of Series C Preferred Stock of such holder such that such holder will not violate the Ownership Limit subsequent to such redemption. 
  
 (c) Holders of Series C Preferred Stock to be redeemed shall be entitled to
the redemption price of $25.00 per share and any accrued and unpaid dividends payable upon such redemption. If (i) notice of redemption of any Series C Preferred Stock has been given in accordance with Section 5(g), (ii) the funds necessary for such
redemption have been set aside by the Corporation in trust for the benefit of the holders of any Series C Preferred Stock so called for redemption and (iii) irrevocable instructions have been given to pay the redemption price and all accrued and
unpaid dividends, then from and after the date fixed for redemption, dividends shall cease to accrue on such Series C Preferred Stock, such Series C Preferred Stock shall no longer be deemed outstanding, and shall not be transferable on the Transfer
Agent’s books without the consent of the Corporation, and all rights of the holders of such Series C Preferred Stock will terminate, except the right to receive the redemption price plus any accrued and unpaid dividends payable upon such
redemption, without interest. As long as no dividends are in arrears, nothing herein shall prevent or restrict the Corporation’s right or ability to purchase, from time to time, either at a public or a private sale, all or any part of the
Series C Preferred Stock at such price or prices as the Corporation may determine, subject to the provisions of 

  

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applicable law, including the repurchase of Series C Preferred Stock in open-market transactions duly authorized by the Board of Directors. 
  
 (d) The deposit of funds with a bank or trust company for the purpose of
redeeming Series C Preferred Stock shall be irrevocable except that: 
  
 (i) the Corporation shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any Series C Preferred Stock
redeemed shall have no claim to such interest or other earnings; and 
  
 (ii) any balance of monies so deposited by the Corporation and unclaimed by the holders of the Series C Preferred Stock entitled thereto at the expiration of two years from the applicable date or dates fixed for
redemption shall be repaid, together with any interest or other earnings thereon, to the Corporation, and after any such repayment, the holders of the Series C Preferred Stock entitled to the funds so repaid to the Corporation shall look only to the
Corporation for payment without interest or other earnings. 
  
 (e) In the event of any redemption of the Series C Preferred Stock because the Board of Directors determines that such redemption is necessary or advisable in order to preserve the status of the Corporation as a REIT for United States
federal income tax purposes, such redemption shall be made in accordance with the terms and conditions set forth in this Section 5 of these Articles Supplementary. If the Corporation calls for redemption of any Series C Preferred Stock pursuant to
and in accordance with this Section 5(e), then the redemption price for such Series C Preferred Stock will be an amount in cash equal to $25.00 per Series C Preferred Share, together with all accrued and unpaid dividends thereon, to and including
the date fixed for redemption, without interest. 
  
 (f) Unless
full cumulative dividends on all Series C Preferred Stock shall have been or contemporaneously are declared and paid in cash or declared and a sum sufficient for the payment thereof in cash set apart for payment for all past Dividend Periods and the
then-current Dividend Period, no Series C Preferred Stock shall be redeemed unless all outstanding Series C Preferred Stock are simultaneously redeemed, and the Corporation shall not purchase or otherwise acquire, directly or indirectly, any Series
C Preferred Stock (except by exchange for shares of equity securities of the Corporation ranking, as to dividends or distributions upon liquidation, junior to the Series C Preferred Stock); provided, however, that the foregoing shall
not prevent (i) the purchase or other acquisition of Series C Preferred Stock by the Corporation, directly or indirectly, in accordance with the terms of Sections 5(a) or 5(e) hereof or Article VII of the Articles of Incorporation or otherwise in
order to preserve the status of the Corporation as a REIT for United States federal income tax purposes or (ii) the purchase or acquisition of Series C Preferred Stock pursuant to a purchase or exchange offer made on the same terms to holders of all
outstanding Series C Preferred Stock. 
  
 (g) Notice of redemption
shall be mailed by the Corporation, postage prepaid, as of a date set by the Corporation not less than 30 nor more than 60 days prior to the date fixed for redemption, addressed to the respective holders of record of the Series C Preferred Stock to
be redeemed at their respective addresses as they appear on the stockholder records of the 

  

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Corporation. No failure to give such notice or any defect thereto or in the mailing thereof shall affect the sufficiency of notice or validity of the
proceedings for the redemption of any Series C Preferred Stock except as to a holder to whom notice was defective or not given. A redemption notice that has been mailed in the manner provided herein shall be conclusively presumed to have been duly
given on the date mailed whether or not the holder received the redemption notice. In addition to any information required by law or the applicable rules of any national securities exchange or national quotation system upon which Series C Preferred
Stock may be listed, admitted to trading or quoted, each notice shall state (i) the date fixed for redemption of the Series C Preferred Stock; (ii) the redemption price; (iii) the number of Series C Preferred Stock to be redeemed; (iv) whether the
redemption is conditioned on the receipt of proceeds of an offering of securities by the Corporation; and (v) that dividends on the Series C Preferred Stock to be redeemed shall cease to accrue on the date fixed for redemption. If fewer than all of
the Series C Preferred Stock held by any holder are to be redeemed, the notice mailed to such holder shall also specify the number of Series C Preferred Stock to be redeemed from such holder. 
  
 (h) If the date fixed for redemption falls after a Dividend Payment Record
Date and on or prior to the corresponding Dividend Payment Date, each holder of Series C Preferred Stock at the close of business of such Dividend Payment Record Date shall be entitled to the dividend payable on such Series C Preferred Stock on the
corresponding Dividend Payment Date notwithstanding the redemption of such Series C Preferred Stock on or prior to such Dividend Payment Date, and each holder of Series C Preferred Stock that surrenders such holder’s Series C Preferred Stock on
such date fixed for redemption will be entitled to the dividends accruing after the end of the Dividend Period to which such Dividend Payment Date relates up to and including the date fixed for redemption. Except as provided above, the Corporation
shall make no payment or allowance for unpaid dividends, whether or not in arrears, on Series C Preferred Stock that are redeemed. 
  
 (i) The Series C Preferred Stock are subject to the provisions of Article VII of the Articles of Incorporation, including, without limitation, the
provision for the purchase of Excess Stock. In addition to the purchase right set forth in Article VII of the Articles of Incorporation, Excess Stock issued upon exchange of Series C Preferred Stock pursuant to such Article VII may be redeemed, in
whole or in part, at any time when outstanding Series C Preferred Stock are being redeemed, for cash, at a redemption price of $25.00 per Series C Preferred Share, plus all accrued and unpaid dividends on the Series C Preferred Stock that were
exchanged for such Excess Stock, through the date of such exchange, without interest. If the Corporation elects to redeem Excess Stock pursuant to the redemption right set forth in the preceding sentence, such Excess Stock shall be redeemed in such
proportion and in accordance with such procedures as Series C Preferred Stock are being redeemed. 
  
 (i) The Series C Preferred Stock have no stated maturity date and will not be subject to any mandatory redemption. 
  
 Section 6. Voting Rights. 
  
 (a) Holders of the Series C Preferred Stock shall not have any voting rights,
except as set forth in this Section 6. In any matter in which the Series C Preferred Stock have the right to 

  

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vote pursuant to this Section 6, each share of Series C Preferred Stock shall be entitled to one vote. 
  
 (b) Whenever dividends on any Series C Preferred Stock shall be in arrears
for six or more quarterly periods (whether or not consecutive) (a “Preferred Dividend Default”), the holders of such Series C Preferred Stock (voting as a class with all other series of Preferred Shares upon which like voting rights have
been conferred and are exercisable (“Parity Preferred”)) will be entitled to vote for the election of a total of two additional directors of the Corporation (the “Preferred Directors”), at a special meeting of called by the
holders of record of at least 20% of the Series C Preferred Stock and the Parity Preferred combined or, if such request is received less than 90 days before the date fixed for the next annual or special meeting of shareholders, at such next annual
or special meeting of shareholders, and at each subsequent annual meeting of shareholders, and all other directors shall be elected by the holders of the Common Stock. In such case, the total number of directors constituting the Board of Directors
shall increase by two. These voting rights of the holders of the Series C Preferred Stock shall continue until all dividends accumulated on such Series C Preferred Stock for the past Dividend Periods and the dividend for the then-current Dividend
Period shall have been fully paid, or declared and a sum sufficient for the payment thereof set apart for payment, at which time the holders of Series C Preferred Stock shall be divested of such voting rights. 
  
 (c) The term of office of each Preferred Director so elected shall terminate
and the number of directors on the Board of Directors shall decrease by two at such time as all accumulated dividends and the dividend for the then-current Dividend Period have been paid in full or set apart for payment in full on the Series C
Preferred Stock and all other series of Parity Preferred. As long as the Series C Preferred Stock or any series of Parity Shares have the right, pursuant to Section 6(b), to elect Preferred Directors, any vacancy in the office of a Preferred
Director may be filled by written consent of the Preferred Director remaining in office, or, if none remains in office, by a vote of the holders of record of a majority of the outstanding Series C Preferred Stock, when they have the voting rights
set forth in Section 6(b), voting as a class with each series of Parity Preferred that has such voting rights. Each Preferred Director shall be entitled to one vote on each matter presented to the Board of Directors. 
  
 (d) As long as any Series C Preferred Stock remain outstanding, the
affirmative vote or consent of the holders of a majority of the Series C Preferred Stock outstanding at the time, given in person or by proxy, either in writing or at a meeting (voting as a class with all other series of Preferred Shares upon which
like voting rights are conferred and exercisable), will be required to: 
  
 (i) create, issue or increase the authorized number of shares of any class or series of shares of beneficial interest ranking senior to the Series C Preferred Stock with respect to payment of dividends or the
distribution of assets upon liquidation, dissolution or winding up of the affairs of the Corporation; or 
  
 (ii) amend, alter, repeal or otherwise change any provision of the Articles of Incorporation, including these Articles Supplementary,
whether by merger, consolidation or otherwise (an “Event”), in a manner that would materially and adversely affect the rights, preferences, powers or privileges of the Series C Preferred Stock; provided, 

  

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however, with respect to the occurrence of any Event, (A) as long as the Series C Preferred Stock remain outstanding with the terms thereof unchanged,
or (B) in the case that the Corporation is not the surviving entity, as long as the Series C Preferred Stock (or shares into which the Series C Preferred Stock have been converted in any successor entity to the Corporation) remain outstanding with
the rights, preferences, voting rights, restrictions, limitations as to dividends and the qualifications and terms or conditions materially unchanged, taking into account that upon the occurrence of an Event, the Corporation may not be the surviving
entity, the occurrence of such Event shall not be deemed to materially and adversely affect such rights, preferences, powers or privileges of holders of Series C Preferred Stock, and in such case such holders shall not have any voting rights with
respect to the occurrence of an Event; provided, further, that holders of the Series C Preferred Stock shall not be entitled to vote with respect to any increase in the amount of the authorized Common Stock or Preferred Stock or the
creation or issuance of additional Series C Preferred Stock, or of any other class or series of beneficial interest, ranking, with respect to the payment of dividends or the distribution of assets upon liquidation, dissolution or winding up of the
Corporation, on a parity with or junior to the Series C Preferred Stock. 
  
 (e) The foregoing voting provisions of this Section 6 shall not apply if, at or prior to the time when the act with respect to which such vote otherwise would have been required, all outstanding Series C Preferred
Stock shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption. 
  
 Section 7. Conversion. 
  
 Holders of Series C Preferred Stock shall have the right to convert all or a portion of such shares into Common Stock, as follows: 
  

	 	(a)	Subject to and upon compliance with the provisions of this Section 7, a holder of Series C Preferred Stock shall have the right, at his option, at any time to convert such shares
into the number of fully paid and nonassessable shares of Common Stock obtained by dividing the aggregate liquidation preference of such shares by the Conversion Price (as in effect at the time and on the date provided for in the last paragraph of
subsection (b) of this Section 7) by surrendering such shares to be converted, such surrender to be made in the manner provided in subsection (b) of this Section 7; provided, however, that the right to convert shares called for
redemption pursuant to Section 5 hereof shall terminate at the close of business on the date fixed for such redemption, unless the Corporation shall default in making payment of any amounts payable upon such redemption under Section 5.

  

	 	(b)	 In order to exercise the conversion right, the holder of each share of Series C Preferred Stock to be converted shall surrender the certificate representing such
share, duly endorsed or assigned to the Corporation or in blank, at the office of the Transfer Agent, 

  

 - 11 - 

	 	 
accompanied by written notice to the Corporation that the holder thereof elects to convert such Series C Preferred Stock. Unless the share issuable on
conversion is to be issued in the same name as the name in which such Series C Preferred Stock is registered, each share surrendered for conversion shall be accompanied by instruments of transfer, in form satisfactory to the Corporation, duly
executed by the holder or such holder’s duly authorized attorney and an amount sufficient to pay any transfer or similar tax (or evidence reasonably satisfactory to the Corporation demonstrating that such taxes have been paid).

  

	 	  	Holders of Series C Preferred Stock at the close of business on a Dividend Payment Record Date shall be entitled to receive the dividend payable on such shares on the corresponding
Dividend Payment Date notwithstanding the conversion thereof following such Dividend Payment Record Date and prior to such Dividend Payment Date. However, Series C Preferred Stock surrendered for conversion during the period between the close of
business on any Dividend Payment Record Date and the opening of business on the corresponding Dividend Payment Date (except shares converted after the issuance of notice of redemption with respect to a date fixed for redemption for Series C
Preferred Stock during such period or coinciding with such Dividend Payment Date, such Series C Preferred Stock being entitled to such dividend on the Dividend Payment Date) must be accompanied by payment of an amount equal to the dividend payable
on such shares on such Dividend Payment Date. A holder of Series C Preferred Stock on a Dividend Payment Record Date who (or whose transferee) tenders any such shares for conversion into Common Stock on such Dividend Payment Date will receive the
dividend payable by the Corporation on such Series C Preferred Stock on such date, and the converting holder need not include payment of the amount of such dividend upon surrender of Series C Preferred Stock for conversion. Except as provided above,
the Corporation shall make no payment or allowance for unpaid dividends, whether or not in arrears, on converted shares or for dividends on the Common Stock issued upon such conversion. 

  

	 	  	As promptly as practicable after the surrender of certificates for shares of Series C Preferred Stock as aforesaid, the Corporation shall issue and shall deliver at the office of
the Transfer Agent to such holder, or on his written order, a certificate or certificates for the number of full shares of Common Stock issuable upon the conversion of such shares in accordance with the provisions of this Section 7, and any
fractional interest in respect of a share of Common Stock arising upon such conversion shall be settled as provided in subsection (c) of this Section 7. 

  

 - 12 - 

	 	 
Each conversion shall be deemed to have been effected immediately prior to the close of business on the date on which the certificates for Series C Preferred
Stock shall have been surrendered and such notice (and if applicable, payment of an amount equal to the distribution payable on such shares) received by the Corporation as aforesaid, and the person or persons in whose name or names any certificate
or certificates for Common Stock shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of the shares represented thereby at such time on such date, and such conversion shall be at the Conversion Price
in effect at such time and on such date unless the stock transfer books of the Corporation shall be closed on that date, in which event such person or persons shall be deemed to have become such holder or holders of record at the close of business
on the next succeeding day on which such stock transfer books are open, but such conversion shall be at the Conversion Price in effect on the date on which such shares have been surrendered and such notice received by the Corporation.

  

	 	(c)	No fractional shares of scrip representing fractions of shares of Common Stock shall be issued upon conversion of Series C Preferred Stock. Instead of any fractional interest in a
share of Common Stock that would otherwise be deliverable upon the conversion of a share of Series C Preferred Stock, the Corporation shall pay to the holder of such share an amount in cash based upon the Current Market Price of the Common Stock on
the Trading Day immediately preceding the date of conversion. If more than one share of Series C Preferred Stock shall be surrendered for conversion at one time by the same holder, the number of full shares of Common Stock issuable upon conversion
thereof shall be computed on the basis of the aggregate number of Series C Preferred Stock so surrendered. 

  

	 	(d)	The Conversion Price shall be adjusted from time to time as follows: 

  

	 	(i)	 If the Corporation shall after the Original Issue Date (A) pay or make a dividend on its capital stock in shares of Common Stock, (B) subdivide its outstanding
Common Stock into a greater number of shares, (C) combine its outstanding Common Stock into a smaller number of shares or (D) issue any shares of capital stock by reclassification of its Common Stock, then in each such case the Conversion Price in
effect at the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such dividend or at the opening of business on the day following the day on which 

  

 - 13 - 

	 	 
such subdivision, combination or reclassification becomes effective, as the case may be, shall be adjusted so that the holder of any Series C Preferred Stock
thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock that such holder would have owned or have been entitled to receive after the happening of any of the events described above had such shares been
converted immediately prior to the record date in the case of a dividend or the effective date in the case of a subdivision, combination or reclassification. An adjustment made pursuant to this subsection (i) shall become effective immediately after
the opening of business on the day next following the record date (except as provided in paragraph (h) below) in the case of a dividend and shall become effective immediately after the opening of business on the day next following the effective date
in the case of a subdivision, combination or reclassification. Such adjustment(s) shall be made successively whenever any of the events listed above shall occur. 

  

	 	(ii)	 If the Corporation shall issue after the Original Issue Date rights, options or warrants to all holders of Common Stock entitling them (for a period expiring within
45 days after the record date mentioned below) to subscribe for or purchase Common Stock at a price per share less than the Fair Market Value per share of Common Stock on the record date for the determination of shareholders entitled to receive such
rights, options or warrants, then the Conversion Price in effect at the opening of business on the day next following such record date shall be adjusted to equal the price determined by multiplying (I) the Conversion Price in effect immediately
prior to the opening of business on the day following the date fixed for such determination by (II) a fraction, the numerator of which shall be the sum of (A) the number of shares of Common Stock outstanding on the close of business on the date
fixed for such determination and (B) the number of shares of Common Stock that the aggregate proceeds to the Corporation from the exercise of such rights, options or warrants for Common Stock would purchase at such Fair Market Value, and the
denominator of which shall be the sum of (A) the number of share of Common Stock outstanding on the close of business on the date fixed for such determination and (B) the number of additional shares of Common Stock offered for subscription or
purchase pursuant to such rights, options or warrants. Such adjustments shall be made successively whenever any such 

  

 - 14 - 

	 	 
rights, options or warrants are issued, and shall become effective immediately after the opening of business on the day next following such record date
(except as provided in subsection (h) below). In determining whether any rights, options or warrants entitle the holders of Common Stock to subscribe for or purchase shares of Common Stock at less than the Fair Market Value, there shall be taken
into account any consideration received by the Corporation upon issuance and upon exercise of such rights, options or warrants, the value of such consideration, if other than cash, to be determined in good faith by the Chief Executive Officer of the
Corporation or the Board of Directors. 

  

	 	(iii)	 If the Corporation shall distribute to all holders of its Common Stock any shares of capital stock of the Corporation (other than Common Stock) or evidence of its
indebtedness or assets (excluding cash dividends paid out of the total equity applicable to Common Stock, including revaluation equity, less the amount of stated capital attributable to Common Stock, determined on the basis of the most recent annual
consolidated cost basis and current value basis and quarterly consolidated balance sheets of the Corporation and its consolidated subsidiaries available at the time of the declaration of the distribution) or rights, options or warrants to subscribe
for or purchase any of its securities (excluding those rights, options and warrants issued to all holders of Common Stock entitling them for a period expiring within 45 days after the record date referred to in subsection (ii) above to subscribe for
or purchase Common Stock, which rights, options and warrants are referred to in and treated under subsection (ii) above) (any of the foregoing being hereinafter in this subsection (iii) called the “Securities”), then in each case the
Conversion Price shall be adjusted so that it shall equal the price determined by multiplying (I) the Conversion Price in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive
such dividend by (II) a fraction, the numerator of which shall be the Fair Market Value per share of Common Stock on the record date mentioned below less the then fair market value (as determined by the Chief Executive Officer of the Corporation or
the Board of Directors, whose determination shall be conclusive) of the portion of the capital stock or assets or evidences of indebtedness so distributed or of such rights, options or warrants applicable to one share of Common Stock, and the
denominator of which shall be the Fair Market Value per share of Common 

  

 - 15 - 

	 	 
Stock on the record date mentioned below. Such adjustment shall become effective immediately at the opening of business on the Business Day next following
(except as provided in subsection (h) below) the record date for the determination of stockholders entitled to receive such dividend. For the purposes of this subsection (iii), the distribution of a Security, which is distributed not only to the
holders of Common Stock on the date fixed for the determination of stockholders entitled to such dividend of such Security, but also is distributed with each share of Common Stock delivered to a person converting a share of Series C Preferred Stock
after such determination date, shall not require an adjustment of the Conversion Price pursuant to this subsection (iii); provided that on the date, if any, on which a person converting a share of Series C Preferred Stock would no longer be
entitled to receive such Security with a share of Common Stock (other than as a result of the termination of all such Securities), a distribution of such Securities shall be deemed to have occurred, and the Conversion Price shall be adjusted as
provided in this subsection (iii) (and such day shall be deemed to be “the date fixed for the determination of the shareholders entitled to receive such dividend” and “the record date” within the meaning of the two preceding
sentences). 

  

	 	(iv)	 No adjustment in the Conversion Price shall be required unless such adjustment would require a cumulative increase or decrease of at least 1% in such price;
provided, however, that any adjustments that by reason of this subsection (iv) are not required to be made shall be carried forward and taken into account in any subsequent adjustment until made; and provided, further,
that any adjustment shall be required and made in accordance with the provisions of this Section 7 (other than this subsection (iv)) not later than such time as may be required in order to preserve the tax-free nature of a distribution to the
holders of Common Stock. Notwithstanding any other provisions of this Section 7, the Corporation shall not be required to make any adjustment of the Conversion Price for the issuance of any Common Stock pursuant to any plan providing for the
reinvestment of dividends or interest payable on securities of the Corporation and the investment of additional optional amounts in Common Stock under such plan. All calculations under this Section 7 shall be made to the nearest cent (with $.005
being rounded upward) or to the nearest one-ten-thousandth of a share (with .0005 of a share 

  

 - 16 - 

	 	 
being rounded upward), as the case may be. Anything in this subsection (d) to the contrary notwithstanding, the Corporation shall be entitled, to the extent
permitted by law, to make such reductions in the Conversion Price, in addition to those required by this subsection (d), as it in its sole discretion shall determine to be advisable in order that any share dividends, subdivision of shares,
reclassification or combination of shares, distribution of rights, options or warrants to purchase shares or securities, or distribution of other assets (other than cash dividends) hereafter made by the Corporation to its shareholders shall not be
taxable. 

  

	 	(e)	 If the Corporation shall be a party to any transaction (including without limitation a merger, consolidation, statutory share exchange, self tender offer for all or
substantially all of the Common Stock, sale of all or substantially all of the Corporation’s assets or recapitalization of the Common Stock and excluding any transaction as to which subsection (d)(i) of this Section 7 applied) (each of the
foregoing being referred to herein as a “Transaction”), in each case as a result of which Common Stock shall be converted into the right to receive shares, stock, securities or other property (including cash or any combination thereof),
each share of Series C Preferred Stock which is not converted into the right to receive shares, stock, securities or other property in connection with such Transaction shall thereafter be convertible into the kind and amount of shares, stock,
securities and other property (including cash or any combination thereof) receivable upon the consummation of such Transaction by a holder of that number of shares of Common Stock into which one share of Series C Preferred Stock was convertible
immediately prior to such Transaction, assuming such holder of Common Stock (i) is not a person with which the Corporation consolidated or into which the Corporation merged or which merged into the Corporation or to which such sale or transfer was
made, as the case may be (a “Constituent Person”), or an affiliate of a Constituent Person and (ii) failed to exercise his rights of the election, if any, as to the kind or amount of shares, stock, securities and other property (including
cash) receivable upon such Transaction (each a “Non-Electing Share”) (provided that if the kind or amount of shares, stock, securities and other property (including cash) receivable upon such Transaction by each Non-Electing Share is not
the same for each Non-Electing Share, then the kind and amount of shares, stock, securities and other property (including cash) receivable upon such Transaction for each Non-Electing Share shall be deemed to be the kind and amount so receivable per
share by a plurality of the Non-Electing Shares). The Corporation shall not be a party to any Transaction unless the terms of such Transaction are consistent 

  

 - 17 - 

	 	 
with the provisions of this subsection (e), and it shall not consent or agree to the occurrence of any Transaction until the Corporation has entered into an
agreement with the successor or purchasing entity, as the case may be, for the benefit of the holders of the Series C Preferred Stock that will require such successor or purchasing entity, as the case may be, to make provision in its certificate or
articles of incorporation or other constituent documents to the end that the provisions of this subsection (e) shall thereafter correspondingly be made applicable as nearly as may reasonably be, in relation to any shares of stock or other securities
or property thereafter deliverable upon conversion of the Series C Preferred Stock. The provisions of this subsection (e) shall similarly apply to successive Transactions. 

  

	 	(f)	If: 

  

	 	(i)	the Corporation shall declare a dividend on the Common Stock (other than in cash out of the total equity applicable to Common Stock, including revaluation equity, less the amount of
stated capital attributable to Common Stock, determined on the basis of the most recent annual consolidated cost basis and current value basis and quarterly consolidated balance sheets of the Corporation and its consolidated subsidiaries available
at the time of the declaration of the distribution); or 

  

	 	(ii)	the Corporation shall authorize the granting to all holders of the Common Stock of rights, options or warrants to subscribe for or purchase any shares of any class or any other
rights, options or warrants; or 

  

	 	(iii)	there shall be any reclassifications of the Common Stock (other than an event to which subsection (d)(i) of this Section 7 applied) or any consolidation or merger to which the
Corporation is a party and for which approval of any stockholders of the Corporation is required, or a statutory share exchange involving the conversion or exchange of Common Stock into securities or other property, or a self tender offer by the
Corporation for all or substantially all of its outstanding Common Stock, or the sale or transfer of all or substantially all of the assets of the Corporation and for which approval of any stockholder of the Corporation is required; or

  

	 	(iv)	there shall occur the voluntary or involuntary liquidation, dissolution or winding up of the Corporation, 

  

 - 18 - 

	 	 
then the Corporation shall cause to be filed with the Transfer Agent and shall cause to be mailed to the holders of the Series C Preferred Stock at their
addresses as shown on the stock records of the Corporation, as promptly as possible, but at least 15 days prior to the applicable date hereinafter specified, a notice stating (A) the date on which a record is to be taken for the purpose of such
dividend or grant of rights, options or warrants, or, if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such distribution or grant of rights, options or warrants are to be determined,
provided, however, that no such notification need be made in respect of a record or determination date for a distribution or grant of rights unless the corresponding adjustment in the Conversion Price would be an increase or decrease
of at least 1% or (B) the date on which such reclassification, consolidation, merger, statutory share exchange, self tender offer, sale, transfer, liquidation, dissolution or winding up is expected to become effective, and the date as of which it is
expected that holders of Common Stock of record shall be entitled to exchange their Common Stock for securities or other property, if any, deliverable upon such reclassification, consolidation, merger, statutory share exchange, self tender offer,
sale, transfer, liquidation, dissolution or winding up. Failure to give or receive such notice or any defect therein shall not affect the legality or validity of the proceedings described in this Section 7. 

  

	 	(g)	Whenever the Conversion Price is adjusted as herein provided, the Corporation shall promptly file with the Transfer Agent an officer’s certificate setting forth the Conversion
Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment absent manifest error. Promptly after delivery of such
certificate, the Corporation shall prepare a notice of such adjustment of the Conversion Price setting forth the adjusted Conversion Price and the effective date of such adjustment and shall mail such notice of such adjustment of the Conversion
Price to the holder of each share of Series C Preferred Stock at such holder’s last address as shown on the stock records of the Corporation. 

  

	 	(h)	 In any case in which subsection (d) of this Section 7 provides that an adjustment shall become effective on the date next following the record date for an event,
the Corporation may defer until the occurrence of such event (A) issuing to the holder of any Series C Preferred Stock converted after such record date and before the occurrence of such event the additional Common Stock issuable upon such conversion
by reason of the adjustment required by such event over and above the Common Stock issuable upon such 

  

 - 19 - 

	 	 
conversion before giving effect to such adjustment and (B) fractionalizing any Series C Preferred Stock and/or paying to such holder any amount of cash in
lieu of any fraction pursuant to subsection (c) of this Section 7. 

  

	 	(i)	There shall be no adjustment of the Conversion Price in case of the issuance of any shares of capital stock of the Corporation in a reorganization, acquisition or other similar
transaction except as specifically set forth in this Section 7. If any action or transaction would require adjustment of the Conversion Price pursuant to more than one subsection of this Section 7, only one adjustment shall be made, and such
adjustment shall be the amount of adjustment that has the highest absolute value. 

  

	 	(j)	If the Corporation shall take any action affecting the Common Stock, other than action described in this Section 7, that in the opinion of the Board of Directors would materially
adversely affect the conversion rights of the holders of the Series C Preferred Stock, the Conversion Price for the Series C Preferred Stock may be adjusted, to the extent permitted by law, in such manner, if any, and at such time, as the Board of
Directors, in its sole discretion, may determine to be equitable in the circumstances. 

  

	 	(k)	The Corporation covenants that it will at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but unissued Common Stock, for
the purpose of effecting conversion of the Series C Preferred Stock, the full number of shares of Common Stock deliverable upon the conversion of all outstanding shares of Series C Preferred Stock not theretofore converted. For purposes of this
subsection (k), the number of shares of Common Stock that shall be deliverable upon the conversion of all outstanding shares of Series C Preferred Stock shall be computed as if at the time of computation all such outstanding shares were held by a
single holder. 

  

	 	  	 The Corporation covenants that any Common Stock issued upon conversion of the Series C Preferred Stock shall be validly issued, fully paid and nonassessable. Before
taking any action that would cause an adjustment reducing the Conversion Price below the then par value of the Common Stock deliverable upon conversion of the Series C Preferred Stock, the Corporation will take any action that, in the opinion of its
counsel, may be necessary in order that the Corporation may validly and legally issue fully paid and nonassessable shares of Common Stock at such adjusted Conversion Price. 

  

 - 20 - 

	 	 
The Corporation shall endeavor to list the Common Stock required to be delivered upon conversion of the Series C Preferred Stock, prior to such delivery,
upon each national securities exchange, if any, upon which the outstanding shares of Common Stock are listed at the time of such delivery. 

  

	 	  	Prior to the delivery of any securities that the Corporation shall be obligated to deliver upon conversion of the Series C Preferred Stock, the Corporation shall endeavor to comply
with all federal and state laws and regulations thereunder requiring the registration of such securities, or any approval of or consent to the delivery thereof by any governmental authority. 

  

	 	(l)	The Corporation will pay any and all documentary stamp or similar issue or transfer taxes payable in respect of the issue or delivery of shares of Common Stock or other securities
or property on conversion of the Series C Preferred Stock pursuant hereto; provided, however, that the Corporation shall not be required to pay any tax that may be payable in respect of any transfer involved in the issue or delivery of
Common Stock or other securities or property in a name other than that of the holder of the shares of Series C Preferred Stock to be converted, and no such issue or delivery shall be made unless and until the person requesting such issue or delivery
has paid to the Corporation the amount of any such tax or has established, to the reasonable satisfaction of the Corporation, that such tax has been paid. 

  

	 	(m)	In addition to the foregoing adjustments, the Corporation will be permitted to make such reductions in the Conversion Price as it considers to be advisable in order that any event
treated for federal income tax purposes as a dividend of stock or stock rights will not be taxable to the holders of the Common Stock. 

  
 Section 8. Ranking. 
  
 In respect of rights to the payment of dividends and the distribution of assets in the event of any liquidation, dissolution or winding up of the
Corporation, the Series C Preferred Stock shall rank (i) senior to all classes or series of the Corporation’s Common Stock and to all other equity securities issued by the Corporation, the terms of which specifically provide that those equity
securities rank junior to the Series C Preferred Stock as to the payment of dividends or the distribution of assets in the event of any liquidation, dissolution or winding up of the Corporation, (ii) on a parity with the Corporation’s $1.93
Series A Cumulative Convertible Preferred Stock, 8% Series B Convertible Preferred Stock and 8% Series B-1 Convertible Preferred Stock and all equity securities issued by the Corporation, the terms of which specifically provide that such equity
securities rank on a parity with the Series C Preferred Stock as to the payment of dividends or the distribution of assets in the event of any liquidation, dissolution or winding up of the Corporation, and (iii) junior to all equity securities
issued by the 

  

 - 21 - 

 
Corporation, the terms of which specifically provide that such equity securities rank senior to the Series C Preferred Stock as to the payment of dividends
or the distribution of assets in the event of any liquidation, dissolution or winding up of the Corporation. The term “equity securities” does not include convertible debt securities, all series of which shall rank senior to the Series C
Preferred Stock prior to the conversion of such debt securities. All Series C Preferred Stock shall rank equally with one another and shall be identical in all respects. 
  
 Section 9. Restrictions on Transfer, Acquisition and Redemption of Shares. 
  
 The Series C Preferred Stock are governed by and issued subject to all of the
limitations, terms and conditions of the Corporation’s Articles of Incorporation, including but not limited to the terms and conditions (including exceptions and exemptions) of Article VII of the Articles of Incorporation. The foregoing
sentence shall not be construed to limit the applicability to the Series C Preferred Stock of any other term or provision of the Articles of Incorporation. In addition to the legend contemplated by Article VII, Section 7.12 of the Articles of
Incorporation, each certificate for Series C Preferred Stock shall bear substantially the following legend: 
  
 The Corporation will furnish to any stockholder upon request and without charge a full statement of the designations, preferences, conversion and other
rights, voting powers, restrictions, limitations as to dividends, qualifications and terms and conditions of redemption of shares of each class authorized to be issued and, with respect to the classes of shares which may be issued in series, the
difference in the relative rights and preferences between the shares of each series, to the extent that they have been set, and the authority of the Board of Directors to fix and determine the relative rights and preferences of subsequent series.
Such request may be made to the Secretary of the Corporation at its principal office or to the transfer agent. 
  
 Section 10. Form. 
  
 The Series C Preferred Stock will be issued and maintained in book-entry form registered under a global certificate in the name of the nominee of The
Depository Trust Corporation (“DTC”) except under limited circumstances. If (i) the Corporation notifies the Transfer Agent in writing that DTC is no longer willing or able to act as a depository and the Corporation is unable to locate a
qualified successor within 90 days or (ii) the Corporation, at its option, notifies the Transfer Agent in writing that the Corporation is electing to issue the Series C Preferred Stock in certificated form, then Series C Preferred Stock in
certificated form will be issued upon registration of transfer of, or in exchange for, the global certificate. 
  
 Section 11. Shares To Be Retired. 
  
 All Series C Preferred Stock that shall have been issued and reacquired in any manner by the Corporation shall be restored to the status of authorized but
unissued shares of Preferred Stock of the Corporation, without designation as to class or series. 
  

 - 22 - 

 Section 12. Record Holders. 
  
 The Corporation and the Transfer Agent may deem and treat the record holder of any Series C Preferred Stock as the true and
lawful owner thereof for all purposes, and neither the Corporation nor the Transfer Agent shall be affected by any notice to the contrary. 
  
 Section 13. Sinking Fund. 
  
 The Series C Preferred Stock shall not be entitled to the benefits of any retirement or sinking fund. 
  
 Section 14. Exclusion of Other Rights. 
  
 The Series C Preferred Stock shall not have any preferences or relative,
participating, optional or other special rights, or voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption other than expressly set forth in the Articles of Incorporation
and these Articles Supplementary. 
  
 Section 15.
Headings of Subdivisions. 
  
 The headings of the various
subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof. 
  
 Section 16. Severability of Provisions. 
  
 If any preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions
of redemption of the Series C Preferred Stock set forth in the Articles of Incorporation and these Articles Supplementary are invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other preferences or
other rights, voting powers, restrictions, limitations as to distributions, qualifications, or terms or conditions of redemption of the Series C Preferred Stock set forth in the Articles of Incorporation that can be given effect without the invalid,
unlawful or unenforceable provision thereof shall remain in full force and effect, and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of
redemption of the Series C Preferred Stock herein set forth shall be deemed dependent upon any other provision thereof unless so expressed therein. 
  
 Section 17. No Preemptive Rights. 
  
 No holder of Series C Preferred Stock shall have any preemptive or preferential right to subscribe for, or to purchase, any additional shares of the
Corporation of any class or series, or any other security of the Corporation that the Corporation may issue or sell. 
  

 - 23 - 

 IN WITNESS WHEREOF, the Corporation has caused these Articles Supplementary to be executed under seal in
its name and on its behalf by its President and Chief Executive Officer and attested to by its Secretary on this 16th day of February, 2005. 
  
  

	
	U.S. RESTAURANT PROPERTIES, INC.
	
	 /s/ Robert J. Stetson

	 Robert J. Stetson
 President and Chief Executive Officer

  
  
 [SEAL] 
  
 ATTEST: 
  

	
	
	 /s/ Stacy M. Riffe

	 Stacy M. Riffe
 Secretary

  
 THE UNDERSIGNED
President and Chief Executive Officer of U.S. Restaurant Properties, Inc., who executed on behalf of the Corporation the foregoing Articles Supplementary of which this certificate is made a part, hereby acknowledges in the name and on behalf of said
Corporation the foregoing Articles Supplementary to be the duly authorized act of said Corporation and hereby certifies to the best of his knowledge, information and belief that the matters and facts set forth herein with respect to the
authorization and approval thereof are true in all material respects under the penalties of perjury. 
  
  

	
	
	 /s/ Robert J. Stetson

	 Robert J. Stetson
 President and Chief Executive Officer

  

 - 24 -Second Amendment to Lease, dated as of February 18, 2005

  
 Exhibit 10.1

  
 SECOND AMENDMENT TO LEASE 
  

	I.	PARTIES AND DATE. 

  
 This Second Amendment to Lease (the “Amendment”) dated February 22, 2005, is by and between IRVINE TECHNOLOGY PARTNERS III, a California general
partnership (“Landlord”), and STANDARD PACIFIC CORP., a Delaware corporation (“Tenant”). 
  

	II.	RECITALS. 

  
 On November 1, 1999, Landlord and Tenant entered into a lease for space in a building located at 15326 Alton Parkway, Irvine, California (the “Alton
Parkway Premises”), which lease was amended by a First Amendment to Lease dated July 7, 2000 (as amended, the “Lease”). 
  
 Landlord and Tenant each desire to modify the Lease to add approximately 25,548 rentable square feet of space in a building located at 26 Technology
Drive, Irvine, California, more particularly described on EXHIBIT A attached to this Amendment and herein referred to as the “Technology Drive Premises”, to adjust the Basic Rent, and to make such other modifications as are set
forth in “III. MODIFICATIONS” next below. 
  

	III.	MODIFICATIONS. 

  
 A. Building. All references to the “Building” in the Lease shall be amended to refer to the two (2) buildings located at 15326 Alton
Parkway, Irvine, California (the “Alton Parkway Building”) and at 26 Technology Drive, Irvine, California (the “Technology Drive Building”), either collectively or individually as the context may reasonably require. 

 
 B. Premises. From and after the “Commencement Date for the
Technology Drive Premises” (as hereafter defined), the Technology Drive Premises together with the Alton Parkway Premises shall collectively constitute the “Premises” under the Lease. 
  
 C. Basic Lease Provisions. The Basic Lease Provisions are hereby
amended as follows: 
  
 1. Effective as of the Commencement Date
for the Technology Drive Premises, Item 1 shall be deleted in its entirety and substituted therefor shall be the following: 
  
 “1. Premises: The Premises are more particularly described in Section 2.1. 
  

			
	Address of Buildings:	  	 15326 Alton Parkway, Irvine, California
 26 Technology
Drive, Irvine, California”

  
 2. Item 4 is hereby
amended by adding the following: 
  
 “Estimated Commencement
Date for the Technology Drive Premises: July 1, 2005. 
  
 “Commencement Date for the Technology Drive Premises” shall mean the earlier of (a) the date upon which all relevant governmental authorities have approved the “Tenant Improvements” described in the Work Letter attached
to this Amendment in accordance with applicable building codes, as evidenced by the issuance of a temporary or final certificate of occupancy from the City of Irvine for the Technology 

  

 1 

 
Drive Premises (but in no event earlier than the Estimated Commencement Date), or (b) the date Tenant acquires possession or commences use of the Technology
Drive Premises for any purpose other than Tenant’s right of early entry pursuant to the provisions of Article I.H of the Work Letter attached hereto. Prior to Tenant’s taking possession of the Technology Drive Premises, the parties shall
memorialize on a form provided by Landlord the actual Commencement Date for the Technology Drive Premises. 
  
 If Landlord, for any reason whatsoever, cannot deliver possession of the Technology Drive Premises to Tenant on or before the Estimated Commencement Date
for the Technology Drive Premises, this Amendment shall not be void or voidable nor shall Landlord be liable to Tenant for any resulting loss or damage. However, Tenant shall not be liable for any rent and the Commencement Date for the Technology
Drive Premises shall not occur until Landlord delivers possession of the Technology Drive Premises and the Technology Drive Premises are in fact available for Tenant’s occupancy with any Tenant Improvements that have been approved as per
Subsection (a) above, except that if Landlord’s failure to so deliver possession of the Estimated Commencement Date for the Technology Drive Premises is attributable to any action or inaction by Tenant (including without limitation any Tenant
Delay described in the Work Letter) then the Commencement Date for the Technology Drive Premises shall not be advanced to the date on which possession of the Technology Drive Premises is tendered to Tenant, and Landlord shall be entitled to full
performance by Tenant (including the payment of rent) from the date Landlord would have been able to deliver the Technology Drive Premises to Tenant but for Tenant’s delay(s).” 
  
 3. Item 5 is hereby deleted in its entirety and substituted therefor shall be the following: 
  
 “5. Lease Term: The Term of this Lease shall expire at midnight on July
31, 2012.” 
  
 4. Item 6 is hereby amended by adding the
following: 
  
 “Basic Rent for the Technology Drive
Premises: 
  
 Commencing on the Commencement Date for the
Technology Drive Premises, the Basic Rent for the Technology Drive Premises shall be Thirty Three Thousand Two Hundred Twelve Dollars ($33,212.00) per month, based on $1.30 per rentable square foot. 
  
 Commencing twelve (12) months following the Commencement Date for the
Technology Drive Premises, the Basic Rent for the Technology Drive Premises shall be Thirty Four Thousand Four Hundred Ninety Dollars ($34,490.00) per month, based on $1.35 per rentable square foot. 
  
 Commencing twenty-four (24) months following the Commencement Date for the
Technology Drive Premises, the Basic Rent for the Technology Drive Premises shall be Thirty Five Thousand Seven Hundred Sixty-Seven Dollars ($35,767.00) per month, based on $1.40 per rentable square foot. 
  

 2 

 Commencing thirty-six (36) months following the Commencement Date for the Technology Drive Premises, the
Basic Rent for the Technology Drive Premises shall be Thirty Seven Thousand Forty-Five Dollars ($37,045.00) per month, based on $1.45 per rentable square foot. 
  

Commencing forty-eight (48) months following the Commencement Date for the Technology Drive Premises, the Basic Rent for the Technology Drive Premises
shall be Thirty Eight Thousand Three Hundred Twenty-Two Dollars ($38,322.00) per month, based on $1.50 per rentable square foot. 
  
 Commencing sixty (60) months following the Commencement Date for the Technology Drive Premises, the Basic Rent for the Technology Drive Premises shall be
Thirty Nine Thousand Five Hundred Ninety-Nine Dollars ($39,599.00) per month, based on $1.55 per rentable square foot. 
  
 Commencing seventy-two (72) months following the Commencement Date for the Technology Drive Premises, the Basic Rent for the Technology Drive Premises
shall be Forty Thousand Eight Hundred Seventy-Seven Dollars ($40,877.00) per month, based on $1.60 per rentable square foot. 
  
 Basic Rent for the Alton Parkway Premises: 
  
 Commencing April 1, 2010, the Basic Rent for the Alton Parkway Premises shall be the “Fair Market Rental” (as hereafter defined). If the parties
are unable to reach agreement concerning the Fair Market Rental for the Alton Parkway Premises within the prior thirty (30) days, then not later than January 1, 2010, Landlord shall notify Tenant in writing of the Basic Rent for the Alton Parkway
Premises that would reflect the prevailing market rental rate for a 28-month renewal of comparable space in the Irvine Spectrum (together with any increases thereof during the extension period) as of the commencement of the extension period for the
Alton Parkway Premises (“Landlord’s Determination”). Should Tenant disagree with the Landlord’s Determination, then Tenant shall, not later than twenty (20) days thereafter, notify Landlord in writing of Tenant’s
determination of those prevailing market rental terms (“Tenant’s Determination”). 
  
 Within ten (10) days following delivery of the Tenant’s Determination, the parties shall attempt to agree on an appraiser to determine the Fair
Market Rental. If the parties are unable to agree in that time, then each party shall designate an appraiser within ten (10) days thereafter. Should either party fail to so designate an appraiser within that time, then the appraiser designated by
the other party shall determine the Fair Market Rental. Should each of the parties timely designate an appraiser, then the two appraisers so designated shall appoint a third appraiser who shall, acting alone, determine the Fair Market Rental for the
Alton Parkway Premises. Any appraiser designated hereunder shall have an MAI certification with not less than five (5) years experience in the valuation of commercial industrial buildings in Orange County, California. 
  
 Within thirty (30) days following the selection of the appraiser and such
appraiser’s receipt of the Landlord’s Determination and the Tenant‘s Determination, the appraiser shall determine whether Landlord’s Determination or Tenant’s Determination more accurately reflects the prevailing market
rental rate for the 28-month renewal of the Lease for 

  

 3 

 
the Alton Parkway Premises, as reasonably extrapolated to the commencement of the extension period as to the Alton Parkway Premises. Accordingly, either the
Landlord’s Determination or the Tenant’s Determination shall be selected by the appraiser as the “Fair Market Rental” for the extension period. In making such determination, the appraiser shall consider rental comparables for the
Project and for similarly improved space (that is, 100% “office” space with 4-sided “glass” walls) in the Irvine Spectrum, with appropriate adjustment for location, proximity of amenities and quality of project, including factors
for market tenant improvement allowances then being granted for lease renewals, but the appraiser shall not attribute any factor for brokerage commissions in making its determination of the Fair Market Rental. At any time before the decision of the
appraiser is rendered, either party may, by written notice to the other party, accept the Determination submitted by the other party, in which event such terms shall be deemed adopted as the agreed Fair Market Rental. The fees of the appraiser(s)
shall be borne entirely by the party whose determination of the Fair Market Rental was not accepted by the appraiser. 
  
 Within twenty (20) days after the determination of the Fair Market Rental, Landlord shall prepare an appropriate amendment to the Lease for the extension
period as to the Alton Parkway Premises, and Tenant shall execute and return same to Landlord within ten (10) days after Tenant’s receipt of same. Should the Fair Market Rental not be established by the commencement of the extension period as
to the Alton Parkway Premises, then Tenant shall continue paying rent at the rate in effect during the month of March, 2010, and a lump sum adjustment shall be made promptly upon the determination of the Fair Market Rental. 
  
 5. Effective as of the Commencement Date for the Technology Drive Premises,
Item 8 shall be deleted in its entirety and substituted therefor shall be the following: 
  
 “8. Floor Area of Premises: Approximately 58,169 rentable square feet, comprised of the following: 
  
 Alton Parkway Premises – approximately 32,621 rentable square feet; and Technology Drive Premises – approximately 25,548 rentable square
feet” 
  
 6. Item 12 is hereby amended by deleting
Landlord’s address for payments and notices and substituted therefor shall be the following: 
  
 “LANDLORD 
  
 THE IRVINE COMPANY 
 550 Newport Center
Drive 
 Newport Beach, CA 92660 
 Attn: Senior Vice President, Operations 
 Irvine Office Properties 
  
 with a copy of notices to: 
  
 THE IRVINE COMPANY 
 550 Newport Center
Drive 
  
  

 4 

 Newport Beach, CA 92660 

	 	Attn:	 Vice President, Operations 

	 	    	 Irvine Office Properties, Technology Portfolio” 

  
 7. Effective as of the Commencement Date for the Technology Drive Premises, Item 14 shall be deleted in its entirety and substituted therefor shall be the
following: 
  
 “14. Vehicle Parking Spaces: Two Hundred
Twenty Two (222) on an unassigned and unreserved basis, except that upon Tenant’s request, Landlord shall designate ten (10) of said spaces (in a location in close proximity to the Alton Parkway Building’s main entry) and ten (10) of said
spaces (in a location in close proximity to the Technology Drive Building’s main entry), which twenty (20) spaces so designated shall be marked “visitor.” 
  
 D. Section 2.4 Landlord’s Responsibilities. The provisions of Section 2.4(a) of the Lease shall be binding on
Landlord as to the Technology Drive Building, provided that all references in said Section 2.4(a) to the “Tenant Improvements” shall mean that the Tenant Improvements constructed pursuant to the attached work Letter, and all references to
the “Commencement Date” shall mean the “Commencement Date for the Technology Drive Premises”. The provisions of Section 2.4(b) of the Lease shall be applicable and binding on Landlord as to the Technology Drive Building for the
twelve (12) month period commencing on the date of Landlord’s tender of possession of the Technology Drive Building to Tenant. The provisions of Section 2.4(c) of the Lease shall be binding on Landlord as to both the Alton Parkway Building and
the Technology Drive Building for the Term of this Lease as extended through July 31, 2012. 
  
 E. Right to Extend the Lease. The provisions of Section 3.3 of the Lease entitled “Right to Extend this Lease” shall remain in full force and effect with both of the two (2) successive periods of
sixty (60) months therein described exercisable by Tenant as therein provided, except that the third (3rd) paragraph
of said Section 3.3 is hereby amended to provide that in making its determination to select either the “Landlord’s Determination” or the “Tenant’s Determination”, the appraiser shall consider rental comparables for
similarly improved space (that is, 100% “office” space with 4-sided “glass” walls) in the Irvine Spectrum. The remainder of the provisions of Section 3.3 shall remain unmodified and in full force and effect. 
  
 F. Signs. Section 5.2 of the Lease is amended to provide that Tenant
shall also have the right to erect and maintain two (2) exterior “building top” signs on the Technology Drive Building for Tenant’s name and/or graphics and in locations designated by Landlord, subject to the terms and conditions of
said Section 5.2. Prior to the Commencement Date for the Technology Drive Premises, Landlord shall remove the existing “Plaid Brothers” building top sign at its sole cost and expense. Further, Landlord shall work with Tenant to place
directional signage, at Tenant’s sold cost and expense, in the Common Areas of the Project. 
  
 G. Maintenance and Repair. In the second line of Section 7.1 of the Lease, the reference to “the Commencement Date” in the second line
thereof shall mean: (1) with respect to the Alton Parkway Premises, “April 1, 2000,” and (2) with respect to the Technology Drive Premises, the “Commencement Date for the Technology Drive Premises.” 
  
 H. Alterations. The second sentence of the first paragraph of Section
7.3 of the Lease is deleted and replaced with the following: 
  
 “Notwithstanding the foregoing, Tenant may make such alterations, additions or improvements to the Premises costing up to One Hundred Thousand Dollars 

  

 5 

 
($100,000.00) for each of the Alton Parkway Premises and the Technology Drive Premises each calendar year of the Term (on a non-cumulative basis) without
Landlord’s consent, provided, however, that any alterations, additions or improvements which change the basic floor plan of the Premises, which change the structural or mechanical systems of the Premises, shall require Landlord’s prior
written consent, which shall not be unreasonably withheld.” 
  
 In the second line of the second paragraph of Section 7.3 of the Lease, the reference to “the Commencement Date” shall mean: (1) with respect to the Alton Parkway Premises, “April 1, 2000,” and (2) with respect to the
Technology Drive Premises, the “Commencement Date for the Technology Drive Premises.” 
  
 I. Restoration. Section 11.1(a)(i) of this Lease is amended to delete the second parenthetical provision therein contained, and to substitute the
following parenthetical provision: 
  
 “...(for which
Tenant shall be responsible in an amount not to exceed One-Hundred Thousand Dollars [$100,000.00] for each casualty affecting either the Alton Parkway Building or the Technology Drive Building);...” 
  
 J. Conduit and Cabling. Tenant, at its sole cost and expense, shall
have the right to pull its cabling through conduit to be installed by Tenant and connecting the Alton Park Building and the Technology Drive Building. Such conduit shall be installed by Tenant in the Common Areas of the Project in locations and at
times reasonably acceptable to Landlord. Tenant shall leave said conduit in place, but shall remove its cabling from such conduit, prior to the Expiration Date or sooner termination of the Lease. 
  
 K. Tenant Improvements for the Technology Drive Premises. Landlord
shall construct the “Tenant Improvements” as defined and in accordance with the provisions of Exhibit X, Work Letter, attached hereto. 
  

	IV.	GENERAL. 

  
 A. Effect of Amendments. The Lease shall remain in full force and effect except to the extent that it is modified by this Amendment. 
  
 B. Entire Agreement. This Amendment embodies the entire understanding
between Landlord and Tenant with respect to the modifications set forth in “III. MODIFICATIONS” above and can be changed only by a writing signed by Landlord and Tenant. 
  
 C. Counterparts. If this Amendment is executed in counterparts, each is hereby declared to be an original; all,
however, shall constitute but one and the same amendment. In any action or proceeding, any photographic, photostatic, or other copy of this Amendment may be introduced into evidence without foundation. 
  
 D. Defined Terms. All words commencing with initial capital letters in
this Amendment and defined in the Lease shall have the same meaning in this Amendment as in the Lease, unless they are otherwise defined in this Amendment. 
  
 E. Corporate and Partnership Authority. If Tenant is a corporation or partnership, or is comprised of either or both of them, each individual
executing this Amendment for the corporation or partnership represents that he or she is duly authorized to execute and deliver this Amendment on behalf of the corporation or partnership and that this Amendment is binding upon the corporation or
partnership in accordance with its terms. 
  
 F.
Attorneys’ Fees. The provisions of the Lease respecting payment of attorneys’ fees shall also apply to this Amendment. 
  

 6 

	V.	EXECUTION. 

  
 Landlord and Tenant executed this Amendment on the date as set forth in “I. PARTIES AND DATE.” above. 
  

									
	 LANDLORD:
	 	 	 	 TENANT:

	 	 	 	 	 
	 IRVINE TECHNOLOGY PARTNERS III,
 a California general partnership
	 	 	 	 STANDARD PACIFIC CORP.,
 a Delaware corporation

					
	By:	 	 THE IRVINE COMPANY
 Its General Partner
	 	 	 	 	 	 
					
	By	 	 /s/ William R. Halford
	 	 	 	By	 	 /s/ Jari L. Kartozian

	 	 	 William R. Halford
	 	 	 	 Name
	 	 Jari L. Kartozian

	 	 	 President, Office Properties
	 	 	 	 Title
	 	 Senior Vice President

					
	By	 	 /s/ Christopher J. Popma
	 	 	 	By	 	 /s/ Clay A. Halvorsen

	 	 	 Christopher J. Popma, Vice President
	 	 	 	 Name
	 	 Clay A. Halvorsen

	 	 	 Operations, Office Properties
	 	 	 	 Title
	 	 Executive Vice President, General Counsel and Secretary

  

 7 

  
 EXHIBIT X 

 
 DOLLAR ALLOWANCE 
 [SECOND GENERATION SPACE] 
  
 The Tenant Improvement work (herein “Tenant Improvements”) shall consist of any work required to complete the Technology Drive Premises pursuant to approved
plans and specifications. All of the Tenant Improvement work shall be performed by the TI Contractor selected by Landlord as provided below, and in accordance with the procedures and requirements set forth below. 
  

	I.	ARCHITECTURAL AND CONSTRUCTION PROCEDURES 

  

	 	A.	Landlord and Tenant have approved the preliminary plan for the Technology Drive Premises prepared by LPA, Inc. dated February 11, 2005 (the “Preliminary Plan”), a copy of
which approved Preliminary Plan is attached as EXHIBIT X-1 hereto. Not later than five (5) business days following delivery from Landlord, Tenant shall approve, which approval shall not be unreasonably withheld, an estimate prepared by
Landlord’s construction manager of the cost for which Landlord estimates that the Tenant Improvements will be completed in accordance with the approved Preliminary Plan (the “Preliminary Cost Estimate”). Tenant’s failure to
approve the Preliminary Cost Estimate within the above referenced time period shall constitute a “Tenant Delay” (as defined below). 

  

	 	B.	Tenant acknowledges and agrees that the Preliminary Plan and Preliminary Cost Estimate are predicated upon certain specifications and information supplied or to be supplied by
Tenant to Landlord or Landlord’s architect, including without limitation Tenant’s final selection of wall and floor finishes, complete specifications and locations (including load and HVAC requirements) of Tenant’s equipment and
details of all “Non-Standard Improvements” (as defined below) to be installed in the Technology Drive Premises (collectively, “Programming Information”). Tenant understands that final construction documents for the Tenant
Improvements shall be predicated on the Programming Information, and accordingly that such information must be accurate and complete. 

  

	 	C.	 The Tenant Improvements shall incorporate materials and specifications substantially similar to those materials and specifications currently built out in the Alton
Parkway Premises (herein, the “Standards”). Except as specifically approved in the Preliminary Plan and/or in the Preliminary Cost Estimate, no deviations from the Standards (herein, the “Non-Standard Improvements”) shall
be permitted except as requested by Tenant and approved by Landlord (which approval shall not be unreasonably withheld), provided that Landlord shall in no event be required to approve any Non-Standard Improvement, not approved in the Preliminary
Plan and/or Preliminary Cost Estimate, if Landlord determines that such improvement (1) is of a lesser quality than the corresponding Standard, (2) fails to conform to applicable governmental requirements, (3) requires Building services beyond the
level normally provided to other tenants, (4) would delay construction of the Tenant Improvements beyond the Estimated Commencement Date for the Technology Drive Premises and Tenant declines to accept such delay in writing as a Tenant Delay, or (5)
would have an adverse aesthetic impact from the exterior of the Technology Drive Premises. The Tenant Improvements approved in the Preliminary Plan and/or in the Preliminary Cost Estimate, whether “Standard” or “Non-Standard”
Improvements, shall be surrendered with the Technology Drive Premises and shall become the property of the Landlord at the 

  

	 	 
Expiration Date or earlier date of termination of this Lease. As of the Expiration Date or earlier termination of this Lease, Landlord shall have the right
to require Tenant to remove any “Non-Standard Improvements” approved by Landlord subsequent to the Preliminary Plan and/or Preliminary Cost Estimate. Notwithstanding the foregoing provisions of the preceding sentence, if at the time of
requesting Landlord’s consent for any such subsequently-approved Non-Standard Improvements, Tenant shall request in writing whether or not Landlord shall require such Non-Standard Improvements to be removed as of the Expiration Date or earlier
termination of this Lease, then Landlord’s right to require Tenant to remove such Non-Standard Improvements shall be exercised, if at all, at the time of Landlord’s approval thereof. 

  

	 	D.	Landlord’s architect and engineers shall prepare and deliver to Tenant working drawings and specifications (“Working Drawings and Specifications”) promptly following
the execution of this Lease, and Landlord shall deliver the “Final Cost Estimate” to Tenant promptly following the completion of the competitive bid process described below. Tenant shall have five (5) business days from the receipt thereof
to approve or disapprove the Working Drawings and Specifications and the Final Cost Estimate. Tenant shall not unreasonably withhold or delay its approval, and any disapproval or requested modification shall be limited to items not contained in the
approved Preliminary Plan or Preliminary Cost Estimate. In no event shall Tenant disapprove the Final Cost Estimate if it does not exceed the approved Preliminary Cost Estimate. Should Tenant disapprove the Working Drawings and Specifications and
the Final Cost Estimate, such disapproval shall be accompanied by a detailed list of revisions. Any revision requested by Tenant and accepted by Landlord shall be incorporated into a revised set of Working Drawings and Specifications and Final Cost
Estimate, and Tenant shall, to the extent the revision was accurately made, approve same in writing within five (5) business days of receipt without further revision. Tenant’s failure to comply in a timely manner with any of the requirements of
this paragraph shall constitute a Tenant Delay. Without limiting the rights of Landlord for Tenant Delays as set forth herein, in the event Tenant has not approved both the Working Drawings and Specifications and the Final Cost Estimate within sixty
(60) days following the date of this Amendment, then Landlord may, at its option, elect to terminate this Amendment by written notice to Tenant. In the event Landlord elects to effect such a termination, Tenant shall, within ten (10) days following
demand by Landlord, pay to Landlord any costs incurred by Landlord in connection with the preparation or review of plans, construction estimates, price quotations, drawings or specifications under this Work Letter and for all costs incurred in the
preparation and execution of this Amendment. 

  

	 	E.	In the event that Tenant requests in writing a revision in the approved Working Drawings and Specifications (“Change”), Landlord shall advise Tenant by written change
order as soon as is practical of any increase in the Completion Cost and/or any Tenant Delay such Change would cause. Tenant shall approve or disapprove such change order in writing within two (2) business days following its receipt from Landlord.
Tenant’s approval of a Change shall be accompanied by Tenant’s payment of any resulting increase in the Completion Cost. Landlord shall have the right to decline Tenant’s request for a Change for any of the reasons set forth in
Article I.C above for Landlord’s disapproval of a Non-Standard Improvement. It is understood that Landlord shall have no obligation to interrupt or modify the Tenant Improvement work pending Tenant’s approval of a change order.

  

	 	F.	 Notwithstanding any provision in the Lease to the contrary, if Tenant fails to comply with any of the time periods specified in this Work Letter, fails 

  

	 	 
otherwise to approve or reasonably disapprove any submittal within five (5) business days, fails to approve or reasonably disapprove in writing the Working
Drawings and Specifications and the Final Cost Estimate within the time provided herein, requests any Changes, furnishes inaccurate or erroneous specifications or other information, or otherwise delays in any manner the completion of the Tenant
Improvements (including without limitation by specifying materials that are not readily available) or the issuance of an occupancy certificate (any of the foregoing being referred to in this Lease as a “Tenant Delay”), then Tenant shall
bear any resulting additional construction cost or other expenses, and the Commencement Date for the Technology Drive Premises shall be deemed to have occurred for all purposes, including Tenant’s obligation to pay rent, as of the date Landlord
reasonably determines that it would have been able to deliver the Technology Drive Premises to Tenant but for the collective Tenant Delays. In no event, however, shall such date be earlier than the Estimated Commencement Date for the Technology
Drive Premises set forth in the Basic Lease Provisions. Should Landlord determine that the Commencement Date for the Technology Drive Premises should be advanced in accordance with the foregoing, it shall so notify Tenant in writing. Landlord’s
determination shall be conclusive unless Tenant notifies Landlord in writing, within five (5) business days thereafter, of Tenant’s election to contest same by arbitration with JAMS in accordance with the provisions of Section 22.7 of the
Lease. Pending the outcome of such arbitration proceedings, Tenant shall make timely payment of all rent due under this Lease based upon the Commencement Date set forth in the aforesaid notice from Landlord. 

  

	 	G.	 Landlord shall submit the Working Drawings and Specifications to a competitive bidding process involving at least three (3) licensed general contractors. Each of
said three general contractors shall solicit bids from at least three (3) subcontractors for each major subtrade, including each of the major “finish” subtrades (e.g., millwork, painting, carpeting, etc.). Such solicitation of bids for the
subtrades shall include bids from those preferred “finish” subcontractors of Tenant approved by Landlord and listed on EXHIBIT X-1 attached hereto (the “Tenant’s Finish Subcontractors”), and from those preferred
subcontractors of Tenant for certain of the “systems” work, approved by Landlord for bid purposes only and listed on EXHIBIT X-2 attached hereto (“Tenant’s Systems Subcontractors”). Landlord shall provide copies of
the bid responses to Tenant. After adjustments for any inconsistent assumptions to reflect an “apples to apples” comparison, Landlord shall select the lowest qualified bidder and that bid so selected shall be referred to as the “Final
Cost Estimate”. In the event Landlord selects other than the lowest bidder, it shall do so based on commercially reasonable factors reasonably acceptable to Tenant, provided that Landlord shall have the right to reject any of Tenant’s
Systems Subcontractors from selection, even if said Subcontractor(s) are the lowest bidder, in Landlord’s sole and absolute discretion. Upon selection of the bidder, Landlord shall enter into a construction contract with the chosen contractor
(the “TI Contractor”) for construction of the Tenant Improvements in accordance with the approved and final Working Drawings and Specifications (the “TI Contract”). Notwithstanding the foregoing, Tenant shall have the right to
cause Landlord to require the TI Contractor to use a Tenant’s Finish Subcontractor for a particular finish subtrade, on the following terms and conditions: (i) Tenant shall notify Landlord of its election to so cause a particular Tenant’s
Finish Subcontractor to be so used, if at all, within three (3) business days following notice from Landlord of the selection of the TI Contractor and submission of the bid responses to Tenant, and (ii) Tenant shall pay to Landlord, concurrently
with the exercise of said election, the amount (if any) by which the bid of the Tenant’s Finish Subcontractor exceeds the Final Cost Estimate 

  

	 	 
bid of the Subcontractor for the applicable “finish” subtrade. Tenant further agrees that any delay caused by such Tenant’s Finish
Subcontractor (and/or caused by a Tenant’s Systems Subcontractor accepted by Landlord for the Tenant Improvement work) in the timely completion of the Tenant Improvement work shall be deemed to constitute a “Tenant Delay” for purposes
of this Work Letter. 

  

	 	H.	Landlord shall permit Tenant and its agents to enter the Technology Drive Premises prior to the Commencement Date for the Technology Drive Premises of the Lease in order that Tenant
may perform the construction or installation of equipment, furniture, fixtures or network and telecommunication cabling through its own contractors, and within fourteen (14) days prior to the Commencement Date for the Technology Drive Premises for
move-in, in a manner and upon terms and conditions and at times satisfactory to Landlord’s representative. The foregoing license to enter the Technology Drive Premises prior to the Commencement Date for the Technology Drive Premises is,
however, conditioned upon Tenant’s contractors and their subcontractors and employees working in harmony and not interfering with the work being performed by Landlord. If at any time that entry shall cause disharmony or interfere with the work
being performed by Landlord, this license may be withdrawn by Landlord upon twenty-four (24) hours written notice to Tenant. That license is further conditioned upon the compliance by Tenant’s contractors with all requirements imposed by
Landlord on third party contractors and subcontractors, including without limitation the maintenance by Tenant and its contractors and subcontractors of workers’ compensation and public liability and property damage insurance in amounts and
with companies and on forms satisfactory to Landlord, with certificates of such insurance being furnished to Landlord prior to proceeding with any such entry. The entry shall be deemed to be under all of the provisions of the Lease except as to the
covenants to pay rent. Landlord shall not be liable in any way for any injury, loss or damage which may occur to any such work being performed by Tenant, the same being solely at Tenant’s risk. In no event shall the failure of Tenant’s
contractors to complete any work in the Technology Drive Premises extend the Commencement Date for the Technology Drive Premises beyond the date that Landlord has completed its Tenant Improvement work and tendered the Technology Drive Premises to
Tenant. 

  

	 	I.	Tenant hereby designates Gary Carlson, Telephone No. (949) 789-1600, as its representative, agent and attorney-in-fact for the purpose of receiving notices, approving submittals and
issuing requests for Changes, and Landlord shall be entitled to rely upon authorizations and directives of such person(s) as if given directly by Tenant. Tenant may amend the designation of its construction representative(s) at any time upon
delivery of written notice to Landlord. 

  

	II.	COST OF TENANT IMPROVEMENTS 

  

	 	A.	Landlord shall complete, or cause to be completed, the Tenant Improvements, at the construction cost shown in the approved Final Cost Estimate (subject to the provisions of this
Work Letter), in accordance with final Working Drawings and Specifications approved by both Landlord and Tenant. Landlord shall pay towards the final construction costs (“Completion Cost”) as incurred a maximum of Five Hundred Ninety-Two
Thousand Five Hundred Forty-One Dollars ($592,541.00), (“Landlord’s Contribution”), based on $25.00 per usable square foot of the Technology Drive Premises, and Tenant shall be fully responsible for the remainder (“Tenant’s
Contribution”). If the actual cost of completion of the Tenant Improvements is less than the maximum amount provided for the Landlord’s Contribution, such savings shall inure to the benefit of Landlord and Tenant shall not be entitled to
any credit or payment. 

  

	 	B.	The Completion Cost shall include all direct costs of Landlord in completing the Tenant Improvements, including but not limited to the following: (i) payments made to architects,
engineers, contractors, subcontractors and other third party consultants in the performance of the work, (ii) permit fees and other sums paid to governmental agencies, (iii) costs of all materials incorporated into the work or used in connection
with the work, and (iv) keying and signage costs. It is further understood and agreed that Landlord’s construction manager shall be entitled to a supervision/administrative fee equal to five percent (5%) of the cost of the Tenant Improvements
work, which fee shall be paid from the Landlord’s Contribution. 

  

	 	C.	Prior to start of construction of the Tenant Improvements, Tenant shall pay to Landlord in full the amount of the Tenant’s Contribution set forth in the Final Cost Estimate. If
the actual Completion Cost of the Tenant Improvements is less than the Final Cost Estimate, any portion of the Tenant’s Contribution paid by Tenant but not expended towards the Completion Cost shall be credited to rent next due under this
Lease. If the actual Completion Cost is greater than the Final Cost Estimate because of modifications or extras not reflected on the approved working drawings, or because of Tenant Delays, then Tenant shall pay to Landlord, within ten (10) days
following submission of an invoice therefor, all such additional costs, including any additional architectural fee. If Tenant defaults in the payment of any sums due under this Work Letter, Landlord shall (in addition to all other remedies) have the
same rights as in the case of Tenant’s failure to pay rent under the Lease. 

  

	III.	DISPUTE RESOLUTION 

  
 All claims or disputes between Landlord and Tenant arising out of, or relating to, this Work Letter shall be decided by “JAMS” pursuant to the provisions of Section 22.7 of the Lease. 
  

  
 EXHIBIT X-1

 (TENANT’S FINISH SUBCONTRACTORS) 
  

					
	 Subtrade

	 	 Subcontractor

	 	 Contact

	1. Appliances	 	Whirlpool / Kitchenaid	 	Pam Faas
	 	 	 	 	(949) 343-2521
			
	2. Cabinets	 	Royal Cabinets	 	Gary Silverman
	 	 	 	 	(909) 721-8187
			
	3. Finish Carpentry	 	Residential Design Services	 	Mark Scholten
	 	 	 	 	(714) 701-9200 X130
			
	4. Ceramic Tile	 	1) Ford Tile	 	Jeff Ford
	 	 	 	 	(949) 279-1724
			
	 	 	2) Sunbelt Tile, Inc.	 	Craig Hoskins
	 	 	 	 	(714) 692-0884
			
	5. Corian Countertops	 	GW Surfaces	 	Bill Gooch
	 	 	 	 	(949) 707-4618
			
	6. Flooring	 	New West Designs	 	Cal Chamberlain
	 	 	 	 	Randy Raus
	 	 	 	 	(949) 855-3277 X231
			
	7. Glass Replacement	 	Canyon Glass	 	Greg Kuezynski
	 	 	 	 	(949) 581-7360
			
	 	 	Eckman Glass	 	Joe Eckman
	 	 	 	 	(714) 639-4458
			
	8. Painting	 	R.C. Wendt Painting	 	Janelle Wilson
	 	 	 	 	(714) 960-2700
			
	9. Railings: Wrought Iron	 	Orange Pacific Construction	 	Richard Perez
	 	 	 	 	(714) 288-0489
			
	10. Custom Built-Ins	 	Marchetta’s Custom Designs	 	Jim Marchetta
	 	 	 	 	(714) 549-8684
			
	11. Granite Fabricator	 	Cordola Marble	 	James Cordola
	 	 	 	 	(818) 252-2000

  
  

  
 EXHIBIT X-2

 (TENANT’S SYSTEMS SUBCONTRACTORS) 
  

					
	 Subtrade

	 	 Subcontractor

	 	 Contact

	1. Heat/Air Conditioning	 	Aliso Air	 	Jeff Loftus
	 	 	 	 	(949) 589-2021
			
	2. Alarm / Audio	 	1) SST	 	Jesse Fowler
	 	 	    Smart Systems Tech.	 	(949) 289-3449
			
	 	 	2) JWE	 	Debbie Soper
	 	 	 	 	(949) 366-8366

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