Document:

ex10_30.htm

    
      
        

      
Exhibit 10.30

     

    
      Sublease
Agreement

       

      This
Sublease Agreement (this “Sublease”),
dated March 20, 2008 for reference purposes only, is entered into by and
between Avigen, Inc., a Delaware corporation (“Sublandlord”),
and BioTime, Inc., a California corporation (“Subtenant”).

       

      Recitals

       

      A.    
       Sublandlord leases certain premises
consisting of approximately 67,482 square feet in a building, located at 1301
Harbor Bay Parkway, Alameda, California, pursuant to that certain Office Lease
dated as of November 2, 2000, between Lincoln-RECP Empire OPCO, a Delaware
limited liability company, as landlord (the “Original Master
Landlord”) and Sublandlord, as tenant, as amended by that certain First
Amendment to Lease Agreement dated as of December 1, 2000, that certain
Second Amendment to Lease Agreement dated as of February 13, 2001 and that
certain letter agreement dated as of January 26, 2004 (collectively, as further
amended or otherwise modified from time to time, the “Master
Lease”), a copy of which is attached as Exhibit A,
as more particularly described therein (the “Premises”).  Capitalized
terms used but not defined herein have the same meanings given in the Master
Lease.

       

      B.     
       Subsequently, Original Master Landlord
sold and assigned all of its right, title and interest in and to the Master
Lease to ARE-Harbor Bay No. 4, llc, a Delaware limited liability company, who in
turn sold and assigned all of its right, title and interest in and to the Master
Lease to SKS Harbor Bay Associates, LLC, a Delaware limited liability company
(“Master
Landlord”).

       

      C.    
        Sublandlord desires to sublease
to Subtenant, and Subtenant desires to sublease from Sublandlord a portion of
the Premises consisting of approximately 11,000 rentable square feet, and more
particularly shown on the layout attached at Exhibit B
hereto (“Sublease
Premises”) upon the terms and conditions provided for
herein.

       

      Now,
Therefore, in consideration of the mutual covenants and conditions contained
herein, Sublandlord and Subtenant covenant and agree as follows:

       

      Agreement

       

      1.       
     Sublease
Premises.  On and subject to the terms and conditions below,
Sublandlord hereby leases to Subtenant, and Subtenant hereby leases from
Sublandlord, the Sublease Premises.  In addition, Subtenant shall be
entitled to share nonexclusive use of the restrooms and lobby areas (the “Sublease Common
Areas”) identified on Exhibit
B.

       

      2.       
     Term.  The
term of this Sublease (the “Term”) shall
commence on April 1, 2008 (the “Commencement
Date”), provided Sublandlord has theretofore obtained the consent of
Master Landlord, and shall expire November 30, 2010, unless sooner terminated
pursuant to any provision hereof.

      
        
           

        

        
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      3.            
Possession;
Early Possession.

       

      (a)           If
for any reason Sublandlord cannot deliver possession of the Sublease Premises to
Subtenant on the Commencement Date due to reasons beyond Sublandlord’s
reasonable control, Sublandlord shall not be subject to any liability therefor,
nor shall such failure affect the validity of this Sublease or the obligations
of Subtenant hereunder or extend the term hereof, provided that no rent shall be
due hereunder until possession of the Sublease Premises has been delivered to
Subtenant.  Sublandlord shall use commercially reasonable efforts to
obtain Master Landlord’s written consent to this
Sublease.  Notwithstanding the foregoing, if Sublandlord cannot obtain
the consent of Master Landlord to this Sublease within thirty (30) days after
execution of this Sublease by Sublandlord and Subtenant, then either Sublandlord
or Subtenant may terminate this Sublease by giving written notice thereof to the
other.

       

      (b)           Subject
to Master Landlord’s consent and approval of this Sublease, Subtenant shall be
entitled to commence installation of Subtenant’s furniture, fixtures and
equipment and occupy the Sublease Premises for its business purposes at any time
prior to the Commencement Date; provided, however, that (i) Subtenant shall not
unreasonably interfere with or disrupt any work being performed by Sublandlord
in the Sublease Premises during such early occupancy, and (ii) prior to any such
entry, Subtenant shall provide Sublandlord and Master Landlord with proof of
Subtenant’s insurance as required hereunder.  Any entry by Subtenant
onto the Sublease Premises prior to the Commencement Date shall be upon and
subject to all of the terms of this Sublease (including Subtenant’s obligations
regarding indemnity and insurance) except those regarding the obligation to pay
Rent (as defined below), which shall commence on the Rent Commencement
Date.  Subtenant agrees that Sublandlord shall not be liable in any
way for any injury, loss or damage which may occur to any of Subtenant’s
property placed upon or installed in the Sublease Premises prior to the
Commencement Date, the same being at Subtenant’s sole risk, and Subtenant shall
be liable for all injury, loss or damage to persons or property arising as a
result of such entry into the Sublease Premises by Subtenant or its agents,
contractors, employees and representatives.

       

      4.         
   Rent.

       

      (a)           Rent.  Commencing
on April 1, 2008 (the “Rent Commencement
Date”) and continuing throughout the term of this Sublease, Subtenant
shall pay monthly rent consisting of Base Rent and Additional Rent (as defined
below) (collectively, “Rent”) to
Sublandlord in the following amounts:

       

      (i)         
   Base
Rent.  Except to the extent provided in Section 4(c) below,
Subtenant shall pay to Sublandlord monthly base rent (“Base Rent”)
on the first (1st) day of each calendar month as follows:

       

      
        	
                Period

              	 	
                Amount

              	 
	
                From
      the Rent Commencement Date through December 31, 2008

              	 	$	22,000.00	 
	
                January
      1, 2009 – December 31, 2009

              	 	$	22,660.00	 
	
                January
      1, 2010 – November 30, 2010

              	 	$	23,339.80	 

      

      
        
           

        

        
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      (ii)     
      Additional
Rent.  In addition to Base Rent, Subtenant shall also pay to
Sublandlord on the first (1st) day of each calendar month an amount equal to
eighteen percent (18%) of the estimated amount of “Tenant’s Share” of “Direct
Expenses” (as defined in the Master Lease) (“Master Lease
Charges”).  Subtenant shall also pay eighteen percent (18%) of
other amounts of Additional Rent due to Master Landlord under the Master Lease
(unless related exclusively to the Premises retained by Sublandlord), which
shall be payable to Sublandlord as and when payments are due from Sublandlord
pursuant to the Master Lease, but at least five (5) business days prior to the
date Sublandlord must pay such amounts to Master Landlord (“Additional
Charges”).  Notwithstanding the foregoing, except for recurring
monthly installments of Master Lease Charges which shall be due as provided
above, in no event shall payment be due less than ten (10) business days after
receipt of written invoice by Subtenant.  “Additional
Rent” is hereby defined as Master Lease Charges, Additional Charges,
Direct Costs and all other amounts owing by Subtenant hereunder.

      

      (iii)           Direct
Costs.  From and after the Commencement Date, Subtenant shall
further pay to Sublandlord on the first (1st) day of each calendar month, as
Additional Rent, an amount estimated by Sublandlord to be the monthly amount of
any costs and expenses applicable to the Sublease Premises which are paid
directly by Sublandlord, including, but not limited to, utilities, personal
property taxes and real property taxes, as well as eighteen percent (18%) of the
reasonable cost incurred by Sublandlord to clean and maintain the Sublease
Common Areas (“Direct
Costs”).  At any time, Sublandlord or Subtenant may cause, at
Subtenant’s expense, any utilities to be separately metered or charged directly
to Subtenant by the provider.

       

      (iv)           Subtenant’s Right to Review
Direct
Costs.

       

      (A)           Sublandlord’s Direct Cost
Statement.  No less often than
annually, Sublandlord shall provide Subtenant with a consolidated statement
setting forth the total amount of the estimated payments made by Subtenant in
the previous year and the actual costs allocated to Subtenant pursuant to this Sublease.  If the total estimated payments made for
the year are insufficient to meet the costs allocated to Subtenant, then
Subtenant shall pay to Sublandlord such deficit within thirty (30) days after
receipt by Subtenant of notice thereof.  If Subtenant is due a refund
for the period, then Sublandlord shall pay such refund to Subtenant within (30)
days after determination thereof.  The provisions of this Section 4(a)(iv)
shall survive the termination of the Sublease.

       

      (B)           Subtenant’s Right to Audit
Direct
Costs.  Not more often than once
each calendar year, Subtenant, upon thirty (30) days advance written notice
thereof to Sublandlord, at Subtenant’s sole cost and expense, may retain an
independent Certified Public Accountant reasonably acceptable to Sublandlord, to
review and audit Sublandlord’s books and records with regard to the Direct Costs for the Sublease Premises.  If Sublandlord and Subtenant determine that Subtenant overpaid its share of any Direct Costs,
Sublandlord shall refund to Subtenant the amount of such overpayment within
thirty (30) days.  If Sublandlord
and Subtenant determine that Subtenant
underpaid its share of Direct
Costs, Subtenant shall pay to Sublandlord
the amount of such deficiency within thirty (30) days.  If
Sublandlord and Subtenant determine that Subtenant overpaid its share of Direct Costs by
more than five percent (5%) (after the
annual reconciliation has occurred as provided in Section 4(a)(iv)(A)
above), Sublandlord shall reimburse
Subtenant for the reasonable actual
costs of Subtenant’s audit not to exceed Five Thousand Dollars
($5,000.00).

      
        
           

        

        
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      (v)           
Exclusions.  Notwithstanding
the foregoing, in the event any amounts payable by Sublandlord to Master
Landlord are (A) due to Subtenant’s breach of any provision of the Master Lease
or this Sublease, (B) due to Subtenant’s negligence or willful misconduct, or
(C) are for the sole benefit of Subtenant, then such amounts shall not be
prorated between Sublandlord and Subtenant and shall be the sole responsibility
of Subtenant.

       

      (b)           Payment of
Rent.  If the Commencement Date does not fall on the first day
of a calendar month, Rent for the first month shall be prorated on a daily basis
based upon a calendar month.  Rent shall be payable to Sublandlord in
lawful money of the United States, in advance, without prior notice, demand, or
offset, on or before the first day of each calendar month during the term
hereof.  All Rent shall be paid to Sublandlord at the address
specified for notices to Sublandlord in Section 14 below.

       

      (c)           Initial
Rent.  Notwithstanding any provision of this Sublease to the
contrary, upon execution of this Sublease, Subtenant shall deliver to
Sublandlord the sum of One Hundred Thousand Dollars ($100,000.00), representing
the initial four (4) months’ Base Rent, Master Lease Charges and Direct
Costs.  In the event that Subtenant does not exercise the termination
right set forth in Section 5 below, Subtenant shall pay to Sublandlord the
sum of Thirty-Eight Thousand Six Hundred and 00/100 Dollars ($38,600.00) (the
“Catch-up
Payment”) on or before August 1, 2008.  In the event that the
Sublease is duly terminated in accordance with the provisions of Section 5,
below, Subtenant will not be required to pay the Catch-up Payment to
Sublandlord.

       

      (d)           Abatement.  In
the event of any casualty or condemnation affecting the Sublease Premises, Rent
payable by Subtenant shall be abated hereunder for the portion of the Sublease
Premises so affected, but only to the extent that Rent under the Master Lease
for such portion of the Sublease Premises is abated, and Subtenant waives any
right to terminate this Sublease in connection with such casualty or
condemnation except to the extent the Master Lease is also terminated as to the
Premises or as expressly provided in Section 26(a) below.

       

      5.       
     Termination
Option.  Subtenant shall have the right terminate this Sublease
by giving written notice to Sublandlord on or before July 15, 2008 (the “Notice
Date”), in which case this Sublease shall terminate as of July 31, 2008,
and Subtenant shall surrender the Sublease Premises to Sublandlord in the
condition required by this Sublease on or before such date.  If
Subtenant fails to deliver such written notice on or before the Notice Date,
Subtenant shall have no further right to terminate this Sublease except as
expressly set forth in this Sublease.

      
        
           

        

        
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      6.          
  Security
Deposit.  Provided that Subtenant has not exercised its right
to terminate this Sublease, on or before the Notice Date, Subtenant shall
deposit with Sublandlord the sum of Fifty Thousand Dollars ($50,000.00) as a
security deposit (“Security
Deposit”).  Subtenant hereby grants to Sublandlord a security
interest in the Security Deposit, including, but not limited to, replenishments
thereof. If Subtenant
fails to pay Rent or other charges when due under this Sublease, or fails to
perform any of its other obligations hereunder, Sublandlord may use or apply all
or any portion of the Security Deposit for the payment of any Rent or other
amount then due hereunder and unpaid, for the payment of any other sum for which
Sublandlord may become obligated by reason of Subtenant’s default or breach, or
for any loss or damage sustained by Sublandlord as a result of Subtenant’s
default or breach.  If Sublandlord so uses any portion of the Security
Deposit, Subtenant shall restore the Security Deposit to the full amount
originally deposited within ten (10) business days after Sublandlord’s written
demand.  Subtenant hereby waives any restrictions on the uses to which
the Security Deposit may be put that is contained in California Civil Code
Section 1950.7 or any successor statute.  Sublandlord shall not be
required to keep the Security Deposit separate from its general accounts, and
shall have no obligation or liability for payment of interest on the Security
Deposit.  The Security Deposit, or so much thereof as had not
theretofore been applied by Sublandlord, shall be returned to Subtenant within
thirty (30) days of the expiration or earlier termination of this Sublease,
provided Subtenant has vacated the Sublease Premises in the condition required
under the terms of this Sublease.

       

      7.       
     Assignment
and Subletting.  Subtenant may not assign, sublet, transfer,
pledge, hypothecate or otherwise encumber the Sublease Premises, in whole or in
part, or permit the use or occupancy of the Sublease Premises by anyone other
than Subtenant , unless Subtenant has obtained Master Landlord’s consent in
accordance with Article 14 of the Master Lease and Sublandlord’s consent, which
consent shall not be unreasonably withheld or
delayed.  Notwithstanding the foregoing, Subtenant may sublease a portion of the Subleased
Premises to Embryome Sciences, Inc. (“Embryome”) without the consent of Sublandlord or Master
Landlord.  Regardless of
Sublandlord’s consent, no subletting or assignment to Embryome or any other
party shall release Subtenant of its obligations hereunder.  Any rent
or other consideration payable to Subtenant pursuant to any sublease or
assignment permitted by this paragraph which is in excess of the Rent payable to
Sublandlord pursuant hereto (“Sublease Bonus
Rent”) shall be divided equally between Sublandlord and Subtenant, after payment to Master
Landlord of any “Transfer Premium” required to be paid under the Master Lease
and deduction of the following actual and reasonable expenses paid to
unaffiliated third-parties:  (i) brokerage and marketing fees; (ii)
legal fees in connection with execution of the assignment or sublease; and (iii)
cost to demise the Sublease Premises.  All such Sublease Bonus Rent shall be determined on a
dollars per square foot basis, by aggregating all subrents received by Subtenant
and dividing such amount by the total number of square feet of subleased space
and subtracting from such amount the Rent per square
foot payable by Subtenant for such space.

       

      8.      
      Condition
of Sublease Premises.

       

      (a)           Except
as expressly set forth herein, Subtenant agrees that (i) Sublandlord has made no
representations or warranties of any kind or nature whatsoever respecting the
Sublease Premises, their condition or suitability for Subtenant’s use; and (ii)
Subtenant agrees to accept the Sublease Premises “as is, where is,” with all
faults, without any obligation on the part of Sublandlord to modify, improve or
otherwise prepare the Sublease Premises for Subtenant’s occupancy.  To
the knowledge of Sublandlord’s manager of facilities, all structural elements of
the Sublease Premises and all piping, and wiring above the ceilings or otherwise
intruding into the Sublease Premises that are servicing other tenants are
operating in a good and workmanlike manner and are in material compliance with
all applicable statutes, ordinances and regulations.

      
        
           

        

        
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      (b)           Sublandlord
has not made an independent investigation of the Premises or determination with
respect to the physical and environmental condition of the Premises including,
without limitation, the existence of any underground tanks, pumps, piping, toxic
or hazardous substances on the Premises.  No investigation has been
made by Sublandlord to ensure compliance with the “Americans With Disabilities
Act” (“ADA”).  ADA
may require a variety of changes to the Sublease Premises, including potential
removal of barriers to access by disabled persons and provision of auxiliary
aids and services for hearing, vision or speech impaired
persons.  Subtenant shall rely solely on its own investigations and/or
that of a licensed professional specializing in the areas referenced in this
Section o8.  Notwithstanding the foregoing, Sublandlord represents and
warrants that (i) its corporate counsel has not received any notice from a
governmental authority indicating that the Sublease Premises are in violation of
any law pertaining to the Sublease Premises; and (ii) the Sublease Premises are
not subject to any enforcement or correction order(s) issued by any governmental
authority.

       

      9.        
    Use.  Subtenant
may use the Sublease Premises for general office purposes and approved
biotechnology laboratory use, as allowed in the Master Lease and this Sublease,
and for no other purpose.  Subtenant shall promptly comply with all
applicable statutes, ordinances, rules, regulations, orders, restrictions of
record, and requirements in effect during the term of this Sublease governing,
affecting and regulating the Sublease Premises, including, but not limited to,
the use thereof.  Subtenant shall not use or permit the use of the
Sublease Premises in a manner that will create waste or a nuisance, interfere
with or disturb other tenants in the Building or violate the provisions of the
Master Lease.  Subtenant acknowledges and agrees that the operation
and use of the Sublease Premises may require that Subtenant apply for and
receive licenses and/or permits from various federal, state and local
governments, and Subtenant covenants and agrees to apply for and receive such
licenses and/or permits as are required.  Subtenant shall provide to
Sublandlord copies of any such licenses and/or permits to the extent applicable
to the Sublease Premises.  Subtenant acknowledges, agrees and
covenants that its occupancy, operation and use of such Sublease Premises shall
be in accordance with:  (a) all applicable state and federal
regulations; (b) all licenses and permits that either Subtenant or
Sublandlord has received or receives in the future respecting such Sublease
Premises; and (c) all policies and procedures Sublandlord has reasonably
promulgated respecting such Sublease Premises.

       

      10.           Furniture
and Equipment.  During the term of this Sublease, Subtenant
shall have the exclusive right to use the modular work stations, furniture and
equipment identified on Exhibit
C hereto (“Furniture and
Equipment”).  Subtenant shall accept such Furniture and
Equipment in its “as-is” condition without any representation or warranty by
Sublandlord.  Subtenant’s insurance as required under this Sublease
shall include an all risk property insurance policy for the Furniture and
Equipment for its full replacement value, and Subtenant shall maintain the
Furniture and Equipment during the term hereof in at least the same condition it
was in as of the Commencement Date, normal wear and tear
excepted.  Provided Subtenant has not terminated this Sublease as
provided in Section 4 above, Subtenant shall purchase the Furniture and
Equipment at a total cost of Seventy-One Thousand Nine Hundred Ninety-Five
Dollars ($71,995.00) (including tax).  Commencing August 1, 2008,
Subtenant shall pay Two Thousand Five Hundred Seventy-One and 26/100 Dollars
($2,571.26) per month (each an “Equipment
Payment”) to Sublandlord until full payment for the Furniture and
Equipment is made to Sublandlord.  Sublandlord shall transfer title to
the Furniture and Equipment to Subtenant upon receipt of the full amount of the
Equipment Cost pursuant to a written Bill of Sale in a form reasonably
acceptable to Subtenant.  If at the expiration or earlier termination
of this Sublease, Subtenant has not paid to Sublandlord the entire amount of the
Furniture and Equipment Cost, Subtenant shall at Subtenant’s option (i) return
the Furniture and Equipment to Sublandlord in the same condition received,
ordinary wear and tear excepted, or (ii) pay Sublandlord the remainder of the
Equipment Payment and remove the Furniture and Equipment from the Sublease
Premises, in which case Sublandlord shall transfer title thereto to Subtenant
pursuant to a written Bill of Sale in a form reasonably acceptable to
Subtenant.

      
        
           

        

        
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      11.           Incorporation
of Master Lease; Maintenance and Repair.

       

      (a)           All
of the terms and provisions of the Master Lease, except as expressly modified in
this Sublease or as provided in subsections (b), (c) and (d) below, are
incorporated into and made a part of this Sublease, and the rights and
obligations of the parties under the Master Lease are hereby imposed upon the
parties hereto with respect to the Sublease Premises, the Sublandlord being
substituted for the Landlord in the Master Lease, the Subtenant being
substituted for the Tenant in the Master Lease provided, however, that the term
“Landlord” in the following Paragraphs of the Master Lease (i) shall mean
Master Landlord, not Sublandlord:  6.1 (Standard Tenant Services)
excepting the last paragraph; 6.4 (Additional Services);
6.5 (Alternate Electric Service of Provider); 7.2 (Maintenance by
Landlord); 7.3 (Landlord’s Repairs and Maintenance Obligations);
8.3 (Landlord’s Property); 14 (Assignment and Subletting);
18 (Subordination); 23 (Parking); the first two sentences of 24.8
(Signs); 24.27 (Building Name and Signage); and 26 (Americans with
Disabilities Act), and (ii) shall mean both Master Landlord and
Sublandlord:  5 (Use); 6.2 (Interruption of Use);
7.4 (Tenant’s Failure to Perform Repairs and Maintenance Obligations);
8.1 (Landlord’s Consent to Alterations); 8.2 (Manner of Construction);
9 (Covenant Against Liens); 10 (Indemnification and Insurance); 17
(Estoppel Certificates); 21 (Compliance with Law); 22 (Entries by
Landlord); 24.30 (Landlord Renovations); 27.3 (Tenant’s Environmental
Obligations); 27.4 (Environmental Indemnity); 27.5 (Survival);
27.6 (Exculpation); and 28 (Financial Statements).  It is
further understood that where reference is made in the Master Lease to the
“Premises,” the same shall mean the Sublease Premises as defined herein; where
reference is made to the “Commencement Date,” the same shall mean the
Commencement Date as defined herein; and where reference is made to the “Lease,”
the same shall mean this Sublease.  The parties specifically agree
that any provisions relating to any construction obligations of “Landlord” under
the Master Lease with respect to construction that occurred or was to have
occurred prior to the Commencement Date hereof, are hereby
deleted.  Sublandlord shall not be liable to Subtenant for any failure
by Master Landlord to perform its obligations under the Master Lease, nor shall
such failure by Master Landlord excuse performance by Subtenant of its
obligations hereunder; provided, however, that Sublandlord shall use its
commercially reasonable efforts to cause Master Landlord to perform its
obligations under the Master Lease.  Anything in the Master Lease to
the contrary notwithstanding, no personal liability shall at any time be
asserted or enforceable by Subtenant against Sublandlord’s stockholders,
directors, officers or partners on account of any of Sublandlord’s obligations
or actions under this Sublease.

      
        
           

        

        
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      (b)           The
following Paragraphs of the Master Lease are expressly excluded and not
incorporated herein:  1.1 (Real Property, Building, Premises and
Complex); 2 (Lease Term); 3 (Base Rent); 4.1 (Additional Rent);
4.4 (Calculation and Payment of Additional Rent); the second sentence of
Section 8.1 (regarding roof penetration); 11 (Damage and Destruction);
12 (Condemnation); 13 (Quiet Enjoyment); 20 (Security Deposit and
Letter of Credit); the third, fourth and fifth sentences of Article
24.8 (Tenant’s Signs); 24.25 (Brokers); 24.28 (Building Directory);
Exhibit A, Exhibit C, and the Summary of Basic Lease
Information.

       

      (c)           Except
as provided in paragraphs (d) and (e) of this Section, Subtenant hereby assumes
and agrees to perform for Sublandlord’s benefit, during the term of this
Sublease, all of Sublandlord’s obligations with respect to the Sublease Premises
under the Master Lease, except as otherwise provided herein.  In
connection with the foregoing, Sublandlord hereby assigns to Subtenant
Sublandlord’s rights under any artisan’s, mechanic’s, builder’s, materialman’s,
manufacturer’s and other warranties and guaranties to the extent the same relate
exclusively to the Sublease Premises and pertain to any matter which Subtenant
is obligated to repair or maintain hereunder.  Subtenant shall not
commit or permit to be committed any act or omission which violates any term or
condition of the Master Lease.  Notwithstanding anything to the
contrary contained herein, this Sublease shall be subject and subordinate to all
of the terms of the Master Lease and Master Landlord shall have all rights in
respect of the Master Lease and the Premises as set forth therein.

       

      (d)           Subject
to Subtenant's obligation under Section 4(a)(iii) to reimburse Sublandlord,
in the form of Additional Rent, for the Direct Costs, Sublandlord shall use
commercially reasonable efforts to provide to Subtenant the following services
on a 24 hour per day, 365 day per day basis:  (i) heating,
ventilation or air-conditioning (“HVAC”)
service and supplies, maintenance or repairs related to the same;
(ii) electrical power and service, supplies, maintenance or repairs related
to the same; (iii) water and sewer; and (iv) plumbing service and
supplies, maintenance or repairs related to the same; provided, however, in no
event shall any failure or interruption of such services be deemed an actual or
constructive eviction of Subtenant, entitle Subtenant to any reduction of Rent
or result in any liability of Sublandlord to Subtenant except to the extent
caused by the gross negligence or willful misconduct of
Sublandlord.  If Subtenant elects to use Sublandlord’s janitorial
service provider, Subtenant shall coordinate such service, at Subtenant’s cost
and with no liability to Sublandlord.  In the event that Sublandlord
fails to maintain the HVAC equipment in a reasonable manner within a reasonable
time not to exceed two (2) business days after Subtenant provides written notice
of such failure to Sublandlord, subject to receipt of Master Landlord’s prior
consent to access the roof as provided in Section 7.1 of the Second Amendment to
the Master Lease, Subtenant may access the roof in order to repair such HVAC
equipment.

       

      (e)           Subject
to Subtenant's obligation under Section 4(a)(iii) to reimburse Sublandlord,
in the form of Additional Rent, for the Direct Costs, Sublandlord agrees to
repair and maintain all items required to be maintained and repaired by the
Tenant under the Master Lease; provided, however, that Subtenant shall bear all
costs of repairing any damage (excluding ordinary wear and tear) caused by the
acts of Subtenant and its employees, agents, invitees, and
contractors.

       

      
        
           

        

        
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      12.           Insurance.  Subtenant
shall be responsible for compliance with the insurance provisions of the Master
Lease, provided, however, any required property insurance as set forth in
Section 10.3.2 of the Master Lease shall be required only in connection
with the Sublease Premises and Subtenants’ property located
therein.  Such insurance shall insure the performance by Subtenant of
its indemnification obligations hereunder and shall name Master Landlord and
Sublandlord as additional insureds.  All insurance required under this
Sublease shall contain an endorsement requiring thirty (30) days’ written notice
from the insurance company to Subtenant and Sublandlord before cancellation or
change in the coverage, insureds or amount of any policy.  Subtenant
shall provide Sublandlord with certificates of insurance evidencing such
coverage prior to the commencement of this Sublease.

       

      13.           Default.  In
addition to defaults contained in Section 19 of the Master Lease, failure of
Subtenant to make any payment of Rent when due hereunder shall constitute an
event of default hereunder.  If Subtenant’s default causes Sublandlord
to default under the Master Lease, Subtenant shall defend, indemnify and hold
Sublandlord harmless from all damages, costs (including reasonable attorneys’
fees), liability, expenses or claims to the extent caused by such
default.

       

      14.           Notices.  The
addresses specified in the Master Lease for receipt of notices to each of the
parties are deleted and replaced with the following:

       

      
        	
                 
      

              	
                To Sublandlord
      at:

              	
                Avigen,
      Inc.

              

      

      1301
Harbor Bay Parkway

      Alameda,
California 94502

      Attention:  Chief
Executive Officer

      

      
        	
                 
      

              	
                To Subtenant
      at:

              	
                BioTime,
      Inc.

              

      

      1301
Harbor Bay Parkway

      Alameda,
California 94502

      Attention:  Chief
Executive Officer

      

      
        	
                 
      

              	
                with a copy
      to:

              	
                Richard
      S. Soroko, Esq.

              

      

      Lippenberger,
Thompson, Welch,

      Soroko
& Gilbert LLP

      201 Tamal
Vista Blvd

      Corte
Madera, California 94925

      

      
        	
                 
      

              	
                After Commencement
      Date:

              	
                At
      the Sublease Premises

              

      

       

      

      15.           Sublandlord’s
Obligations.

       

      (a)           To
the extent that the provision of any services or the performance of any
maintenance or any other act respecting the Sublease Premises, the Premises or
Building is the responsibility of Master Landlord (collectively, “Master Landlord
Obligations”), upon Subtenant’s request, Sublandlord shall make
reasonable efforts to cause Master Landlord to perform such Master Landlord
Obligations; provided, however, that in no event shall Sublandlord be liable to
Subtenant for any liability, loss or damage whatsoever in the event that Master
Landlord should fail to perform the same, nor shall Subtenant be entitled to
withhold the payment of Rent or terminate this Sublease.  It is
expressly understood that the services and repairs which are incorporated herein
by reference, including, but not limited to, the maintenance of all of the fire
protection and life/safety systems, the roof and roof coverings, exterior
painting, exterior window cleaning, exterior lighting, parking areas, pavement,
landscaping, sprinkler systems, sidewalks, driveways and curbs, as well as
maintenance of Project common areas and structural portions of the floors,
foundations and exterior and interior load bearing walls and the structural
portions of the roof, will in fact be furnished by Master Landlord and not by
Sublandlord.  In addition, Sublandlord shall not be liable for any
maintenance, restoration (following casualty or destruction) or repairs in or to
the Building or the Sublease Premises, other than its obligation hereunder to
use reasonable efforts to cause Master Landlord to perform its obligations under
the Master Lease; provided, however, that if Sublandlord fails to use reasonable
effort to cause Master Landlord to perform within ten (10) business days after
receipt of written notice of such failure from Subtenant, Sublandlord agrees
that Subtenant may, at Subtenant’s election, exercise such rights as Sublandlord
may have to enforce or seek the enforcement of Master Landlord’s obligations
under the Master Lease to the extent such obligations of Master Landlord affect
the Sublease Premises, all at Subtenant’s expense.

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      (b)           Except
as otherwise provided herein, Sublandlord shall have no other obligations to
Subtenant with respect to the Sublease Premises or the performance of the Master
Landlord Obligations.

       

      16.           Early
Termination of Sublease.  Except as expressly set forth in this
Section 15, if the Master Lease should terminate prior to the expiration of this
Sublease, Sublandlord shall have no liability to Subtenant on account of such
termination unless said termination was a result of default by
Sublandlord.  To the extent that the Master Lease grants Sublandlord
any discretionary right to terminate the Master Lease, whether due to casualty,
condemnation, or otherwise, Sublandlord shall be entitled to exercise or not
exercise such right in its complete and absolute discretion.

       

      17.           Consent of
Master Landlord and Sublandlord.  If Subtenant desires to take
any action which requires the consent or approval of Sublandlord pursuant to the
terms of this Sublease, prior to taking such action, including, without
limitation, making any alterations, then, notwithstanding anything to the
contrary herein, (a) Sublandlord shall have the same rights of approval or
disapproval as Master Landlord has under the Master Lease, and (b) Subtenant
shall not take any such action until it obtains the consent of Sublandlord and
Master Landlord, as may be required under this Sublease or the Master
Lease.  This Sublease shall not be effective unless and until any
required written consent of the Master Landlord shall have been
obtained.

       

      18.           Indemnity.  Subtenant
shall indemnify, defend, protect, and hold Sublandlord and Master Landlord
harmless from and against all actions, claims, demands, costs liabilities,
losses, reasonable attorneys’ fees, damages, penalties, and expenses
(collectively, “Claims”)
which may be brought or made against Sublandlord or which Sublandlord may pay or
incur to the extent caused by (i) a breach of this Sublease by Subtenant,
(ii) any violation of law by Subtenant or its employees, agents,
contractors or invitees (collectively, “Agents”)
relating to the use or occupancy of the Sublease Premises, (iii) any act or
omission by Subtenant or its Agents resulting in contamination of any part or
all of the Premises by Hazardous Materials, or (iv) the negligence or willful
misconduct of Subtenant or its Agents.

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

      19.           Brokers.  Each
party hereto represents and warrants that it has dealt with no broker in
connection with this Sublease and the transactions contemplated
herein.  Each party shall indemnify, protect, defend and hold the
other party harmless from all costs and expenses (including reasonable
attorneys’ fees) arising from or relating to a breach of the foregoing
representation and warranty.

       

      20.           Parking.  Subtenant shall
be entitled to eighteen percent (18%) of the parking rights granted to
Sublandlord pursuant to the Master Lease.

       

      21.           Financial
Statements.  Subtenant shall deliver to Sublandlord a copy of
each quarterly report on Form 10-Q and annual report on Form 10-K (“SEC Reports”)
filed by Subtenant with the Securities and Exchange Commission (the “SEC”) under
the Securities Exchange Act of 1934, as amended.  Such SEC Reports
shall be delivered to Sublandlord within ten (10) business days after filing
with the SEC.

       

      22.           Surrender
of Sublease Premises. In lieu of any obligation or liability set forth in
the Master Lease, upon the termination of the Sublease, Subtenant shall
surrender the Sublease Premises to Sublandlord free of hazardous materials
introduced, discharged, released or placed on the Sublease Premises by
Subtenant, broom-clean and in as good a condition as on the Commencement Date,
ordinary wear and tear excepted, and except for any repairs or maintenance
required to be performed by Sublandlord.  In addition, Subtenant shall
remove any alterations, additions and improvements constructed or installed by
Subtenant (whether or not made with Sublandlord’s consent), prior to the
termination of the Sublease and restore the Sublease Premises to its prior
condition, ordinary wear and tear excepted, repairing all damage caused by or
related to any such removal, all at Subtenant’s expense.  Any property
of Subtenant not removed hereunder shall be deemed, at Sublandlord’s option, to
be abandoned by Subtenant and Sublandlord may store such property in Subtenant’s
name at Subtenant’s expense, and/or dispose of the same in any manner permitted
by law.

       

      23.           No Third
Party Rights.  The benefit of the provisions of this Sublease
is expressly limited to Sublandlord and Subtenant and their respective permitted
successors and assigns.  Under no circumstances will any third party
be construed to have any rights as a third party beneficiary with respect to any
of said provisions.

       

      24.           Quiet
Enjoyment.  Subtenant shall peacefully have, hold and enjoy the
Sublease Premises, subject to the terms and conditions of this Sublease and
subject to the Master Lease, provided that Subtenant pays all rent and performs
all of Subtenant’s covenants and agreements contained herein.

       

      25.           Counterparts;
Entire Agreement; Amendment.  This Sublease may be signed in
two or more counterparts, each of which shall be deemed an original and all of
which shall constitute one agreement.  This Sublease represents the
entire agreement of Sublandlord and Subtenant with respect to the subject matter
hereof.  This Sublease may not be amended except by a written
instrument executed by both parties hereto.

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

      26.           Damage and
Destruction.

       

      (a)           Termination of Master
Lease.  If the Sublease Premises is damaged or destroyed and
Master Landlord or Sublandlord exercises any option either may have to terminate
the Master Lease, if any, this Sublease shall terminate as of the date of the
casualty.  In the event of any such termination by Sublandlord,
Sublandlord shall use good faith efforts, at no cost to Sublandlord, to
assist  Subtenant to enter into a direct lease with Master Landlord
(at Master Landlord’s sole discretion) if Subtenant so desires.  If
the Master Lease imposes any repair or restoration obligation on Sublandlord,
Subtenant shall be responsible for all such obligations as they relate to the
Sublease Premises.  In the event that after a damage or destruction of
the Sublease Premises, where the time estimated to restore the Sublease Premises
exceeds 180 days, Subtenant and Sublandlord shall each have the right to
terminate this Sublease on written notice to given to the other party within
thirty (30) days after determination of the amount of time to restore the
Sublease Premises, which termination shall be effective as of the date of the
casualty.

       

      (b)           Continuation of
Sublease.  If the Master Lease or this Sublease is not
terminated following any damage or destruction as provided in subsection (a)
above, this Sublease shall remain in full force and effect, and Rent shall be
abated in accordance with Section 4(d) of this Sublease.

       

      27.           Eminent
Domain.  If all or any part of the Sublease Premises is
condemned by eminent domain, inversely condemned or sold in lieu of
condemnation, for any public or a quasi-public use or purpose, this Sublease may
be terminated as of the date of title vesting in such proceeding by Sublandlord,
without first obtaining the consent of Subtenant.

       

      28.           Estoppel
Certificates.  Subtenant or Sublandlord, within ten (10)
business days of each request by the other to do so, shall each execute and
deliver to the other estoppel certificate(s), (i) certifying that this
Sublease is unmodified and in full force and effect or, if modified, stating the
nature of such modification and certifying that this Sublease, as so modified,
is in full force and effect and the date to which the rent and other charges are
paid in advance, if any, and (ii) acknowledging that there are not, to its
knowledge, any uncured defaults on the part of the other party hereunder, or
stating the nature of defaults if such exist, and (iii) evidencing the
status of the Sublease, as may be reasonably required either by a prospective or
actual lender making a loan to Sublandlord or Subtenant

       

      29.           Signage. Subtenant
shall be entitled, at its sole cost and expense, to one (1) identification sign
outside of the Sublease Premises on the floor on which the Sublease Premises are
located.  The location, quality, design, style, lighting and size of
such sign shall be consistent with the Master Landlord's Building standard
signage program and shall be subject to Master Landlord's prior written
approval, in accordance with the terms of the Master Lease and Sublandlord’s
approval, not to be unreasonably withheld, conditioned or
delayed.  Upon the expiration or earlier termination of this Sublease,
Subtenant shall be responsible, at its sole cost and expense, for the removal of
its signage and the repair of all damage to the Building caused by such
removal.  Except for such identification sign, Subtenant may not
install any signs on the exterior or roof of the Building or the Common Areas of
the Building, the Complex or the Real Property without the approval of the
Master Landlord and Sublandlord.  Any signs, window coverings, or
blinds (even if the same are located behind the Master Landlord approved window
coverings for the Building), or other items visible from the exterior of the
Sublease Premises or Building are subject to the prior approval of Master
Landlord, in its sole and absolute discretion.

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

      In
Witness Whereof, the parties have executed this Sublease as of the date first
written above.

       

      
        	
                Sublandlord:

              	 
      	
                Avigen,
      Inc.,

              	 
	 
      	 
      	
                a
      Delaware corporation

              	 
	 
      	 
      	 
      	 
	 
      	 
      	 
      	 
	 
      	 
      	
                By:
         /s/ Andrew A.
      Sauter

              	 
	 
      	 
      	
                Name:   Andrew A.
      Sauter

              	 
	 
      	 
      	
                Title:     Chief Financial
      Officer

              	 
	 
      	 
      	 
      	 
	
                Subtenant:

              	 
      	
                BioTime,
      Inc.,

              	 
	 
      	 
      	
                a
      California corporation

              	 
	 
      	 
      	 
      	 
	 
      	 
      	 
      	 
	 
      	 
      	
                By:
         /s/ Robert W.
      Peabody

              	 
	 
      	 
      	
                Name:
        Robert W.
      Peabody

              	 
	 
      	 
      	
                Title:
         Sr.V.P. &
      COO

              	 

      

       

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

      Exhibit 
A

       

      Master
Lease

       

      
        OFFICE
LEASE

         

        PARKWAY CENTER

         

        ALAMEDA,
CALIFORNIA

         

        LINCOLN-RECP
EMPIRE OPCO, LLC,

         

        A
DELAWARE LIMITED LIABILITY COMPANY

         

        AS
LANDLORD,

         

        AND

         

        AVIGEN,
INC.,

         

        A
DELAWARE CORPORATION

         

        AS
TENANT

         

        
          
            

          

        

         

        TABLE
OF CONTENTS

         

        
          	
                  ARTICLE
      PAGE

                	 
      
	 
      	 
      
	
                  Article
      1 -- Real Property, Building, Premises and Complex

                	
                  1

                
	 
      	 
      
	
                  Article
      2 -- Lease Term

                	
                  2

                
	 
      	 
      
	
                  Article
      3 -- Base Rent

                	
                  3

                
	 
      	 
      
	
                  Article
      4 -- Additional Rent

                	
                  3

                
	 
      	 
      
	
                  Article
      5 -- Use of Premises

                	
                  10

                
	 
      	 
      
	
                  Article
      6 -- Services and Utilities

                	
                  11

                
	 
      	 
      
	
                  Article
      7 -- Repairs

                	
                  14

                
	 
      	 
      
	
                  Article
      8 -- Additions and Alterations

                	
                  15

                

        

        

          
            
               

            

            
               

              
                

              

            

            
               

            

          

        

        

        
          	
                  Article
      9 -- Covenant Against Liens

                	
                  17

                
	 
      	 
      
	
                  Article
      10 -- Indemnification and Insurance

                	
                  17

                
	 
      	 
      
	
                  Article
      11 -- Damage and Destruction

                	
                  20

                
	 
      	 
      
	
                  Article
      12 -- Condemnation

                	
                  21

                
	 
      	 
      
	
                  Article
      13 -- Covenant of Quiet Enjoyment

                	
                  22

                
	 
      	 
      
	
                  Article
      14 -- Assignment and Subletting

                	
                  22

                
	 
      	 
      
	
                  Article
      15 -- Surrender; Ownership and Removal of Trade Fixtures..

                	
                  26

                
	 
      	 
      
	
                  Article
      16 -- Holding Over

                	
                  26

                
	 
      	 
      
	
                  Article
      17 -- Estoppel Certificates

                	
                  27

                
	 
      	 
      
	
                  Article
      18 -- Subordination

                	
                  27

                
	 
      	 
      
	
                  Article
      19 -- Tenant's Defaults; Landlord's Remedies

                	
                  28

                
	 
      	 
      
	
                  Article
      20 -- Security Deposit.

                	
                  31

                
	 
      	 
      
	
                  Article
      21 -- Compliance with Law.

                	
                  33

                
	 
      	 
      
	
                  Article
      22 -- Entry by Landlord

                	
                  33

                
	 
      	 
      
	
                  Article
      23 -- Tenant Parking

                	
                  34

                

        

        

          
            
               

            

            
               

              
                

              

            

            
               

            

          

        

        

        
          	
                  Article
      24 -- Miscellaneous Provisions

                	
                  34

                
	 
      	 
      
	
                  Article
      25 -- Mortgagee Protection

                	
                  40

                
	 
      	 
      
	
                  Article
      26 -- Americans With Disabilities Act

                	
                  41

                
	 
      	 
      
	
                  Article
      27 -- Hazardous Materials

                	
                  42

                
	 
      	 
      
	
                  Article
      28 -- Financial 23Statements

                	
                  44

                

        

         

        EXHIBITS

         

        Exhibit
A -- Outline of Floor Plan of Premises

         

        Exhibit B
-- [Intentionally omitted.]

         

        Exhibit
C -- Amendment to Lease

         

        Exhibit
D -- Rules and Regulations

         

        Exhibit
E -- Form of Tenant's Estoppel Certificate

         

        
          
             

          

          
            i

            
              

            

          

          
             

          

        

         

        
          PARKWAY
CENTER

          SUMMARY
OF BASIC LEASE INFORMATION

           

          This
Summary of Basic Lease Information ("SUMMARY") is hereby incorporated into and
made a part of the attached Office Lease. Each reference in the Office Lease to
any term of this Summary shall have the meaning as set forth in this Summary for
such term. In the event of a conflict between the terms of this Summary and the
Office Lease, the terms of the Office Lease shall prevail. Any capitalized terms
used Summary and not otherwise defined herein shall have the meaning as set
forth in the Office Lease.

        

         

        
          	
                  TERMS
      OF LEASE

                	
                  DESCRIPTION

                
	
                  (References
      are to the Office Lease)

                	 
      
	
                  1.

                	
                  DATE:

                	
                  November
      2, 2000

                
	 
      	 
      	 
      
	
                  2

                	
                  LANDLORD:

                	
                  LINCOLN-RECP
      EMPIRE OPCO, LLC,

                
	 
      	 
      	
                  a
      Delaware limited liability company

                
	 
      	 
      	 
      
	
                  3.

                	
                  ADDRESS
      OF LANDLORD'S AGENT

                	
                  Legacy
      Partners Commercial, Inc.,

                
	 
      	
                  (SECTION
      24.19):

                	
                  101
      Lincoln Centre Drive

                
	 
      	 
      	
                  Foster
      City, California 94404

                
	 
      	 
      	
                  Attn:  Mack
      Laney, Sr. Vice President Operations

                
	 
      	 
      	 
      
	 
      	 
      	
                  with
      a copy to:

                
	 
      	 
      	
                  Legacy
      Partners Commercial, Inc.,

                
	 
      	 
      	
                  1411
      Harbor Bay Parkway, Suite 1000

                
	 
      	 
      	
                  Alameda,
      California 94502

                
	 
      	 
      	
                  Attn:  Property
      Manager

                
	 
      	 
      	 
      
	
                  4.

                	
                  TENANT:

                	
                  AVIGEN,
      INC.,

                
	 
      	 
      	
                  a
      Delaware corporation

                
	 
      	 
      	 
      
	
                  5.

                	
                  ADDRESS
      OF TENANT:

                	
                  1301
      Harbor Bay Parkway

                
	 
      	
                  (SECTION
      24.19):

                	
                  Alameda,
      California 94502

                
	 
      	 
      	
                  Attention:  Thomas
      J. Paulson

                
	 
      	 
      	
                  (Prior
      to Lease Commencement Date)

                
	 
      	 
      	 
      
	 
      	 
      	
                  and

                
	 
      	 
      	 
      
	 
      	 
      	
                  1301
      Harbor Bay Parkway

                
	 
      	 
      	
                  Alameda,
      California 94502

                
	 
      	 
      	
                  Attention:  Thomas
      J. Paulson

                
	 
      	 
      	
                  (After
      Lease Commencement Date)

                
	 
      	 
      	 
      
	
                  6.

                	
                  PREMISES,
      BUILDING AND COMPLEX

                	 
      
	 
      	
                  (ARTICLE
      1):

                	 
      
	 
      	 
      	 
      
	 
      	
                  6.1
      PREMISES:

                	
                  Subject
      to Article 2, approximately 67,482 rentable square feet of space located
      on the first and second floors of the Building, as set forth in Exhibit A
      attached hereto.

                
	 
      	 
      	 
      
	 
      	
                  6.2
      BUILDING: rentable square feet.

                	
                  Approximately
      67,482 rentable square feet.

                
	 
      	 
      	 
      
	 
      	
                  6.3
      COMPLEX:

                	
                  Parkway Center;
      Approximately 463,860

                
	 
      	 
      	 
      
	 
      	
                  6.4
      PREMISES ADDRESS:

                	
                  1301
      Harbor Bay Parkway

                
	 
      	 
      	
                  Alameda,
      California 94502

                
	 
      	 
      	
                  Floor(s)
      upon which the Premises are located: First and Second

                
	 
      	 
      	 
      
	
                  7.

                	
                  TERM:

                	 
      
	 
      	 
      	 
      
	 
      	
                  7.1
      LEASE TERM:

                	
                  Ten
      (10) years and Zero (0) months.

                
	 
      	 
      	 
      
	 
      	
                  7.2
      LEASE COMMENCEMENT DATE:

                	
                  December
      1, 2000

                
	 
      	 
      	 
      
	 
      	
                  7.3
      LEASE EXPIRATION DATE:

                	
                  The
      last day of the Term of the Lease shall be November 30, 2010, subject to
      the provisions of Article 2.

                
	 
      	 
      	 
      
	 
      	
                  7.4
      AMENDMENT TO LEASE:

                	
                  Landlord
      and Tenant shall confirm the Lease Commencement Date and Lease Expiration
      Date in an Amendment to Lease (Exhibit "C"), which may be required to be
      executed pursuant to Article 2 of the Office
  Lease.

                

        

        

          
            
               

            

            
              ii

              
                

              

            

            
               

            

          

        

         

        8. BASE RENT (ARTICLE 3):

        

        
          	
                  TERM

                	 	
                  SQUARE
      FEET

                	 	 	
                  ANNUAL
      RENTAL RATE

                  PER
      RENTABLE SQUARE

                  FOOT

                	 	 	
                  MONTHLY

                  INSTALLMENT
      OF

                  BASE
      RENT

                	 
	 
      	 	 	 	 	 	 	 	 	 
	
                  12/1/00
      -- 11/30/01

                	 	 	34,537	 	 	$	24.00	 	 	$	69,074.00	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  12/1/01
      -- 11/30/02

                	 	 	34,537	 	 	$	24.72	 	 	$	71,146.22	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  12/1/02
      -- 12/31/02

                	 	 	34,537	 	 	$	25.44	 	 	$	73,218.44	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  1/1/03
      -- 11/30/03

                	 	 	67,482	 	 	$	25.44	 	 	$	143,061.84	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  12/1/03
      -- 11/30/04

                	 	 	67,482	 	 	$	26.28	 	 	$	147,785.58	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  12/1/04
      -- 11/30/05

                	 	 	67,482	 	 	$	27.00	 	 	$	151,834.50	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  12/1/05
      -- 11/30/06

                	 	 	67,482	 	 	$	27.84	 	 	$	156,558.24	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  12/1/06
      -- 11/30/07

                	 	 	67,482	 	 	$	28.68	 	 	$	161,281.98	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  12/1/07
      -- 11/30/08

                	 	 	67,482	 	 	$	29.52	 	 	$	166,005.72	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  12/1/08
      -- 11/30/09

                	 	 	67,482	 	 	$	30.36	 	 	$	170,729.46	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  12/1/09
      -- 11/30/10

                	 	 	67,482	 	 	$	31.32	 	 	$	176,128.02	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 

        

         

        Base Rent
for the "Remaining Premises" (as defined in Article 2 below) shall be payable
from the "RP Commencement Date" (as defined in Article 2 below) through December
31, 2002, in accordance with the following schedule:

        

        
          	
                  TERM

                	 	
                  REMAINING
      

                  PREMISES

                  SQUARE FEET

                	 	 	
                  REMAINING
      PREMISES

                  --ANNUAL
      RENTAL

                  RATE
      PER RENTABLE

                  SQUARE
      FOOT

                	 	 	
                  MONTHLY

                  INSTALLMENT OF

                  BASE RENT

                	 
	 
      	 	 	 	 	 	 	 	 	 
	
                  10/1/01
      -- 5/31/02

                	 	 	32,945	 	 	$	18.24	 	 	$	50,076.40	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  6/1/02
      -- 12/31/02

                	 	 	32,945	 	 	$	19.08	 	 	$	52,382.55	 

        

        

        
          	 
      	
                  ADVANCE
      RENT (SECTION 3.1):

                	
                  Sixty-nine
      Thousand Seventy-four Dollars

                
	 
      	 
      	
                  ($69,074.00)

                
	 
      	 
      	 
      
	
                  9.

                	
                  ADDITIONAL
      RENT (ARTICLE 4):

                	 
      
	 
      	 
      	 
      
	 
      	
                  9.1
      BASE YEAR FOR TENANT'S SHARE OF DIRECT EXPENSES

                	
                  Calendar
      year 2001

                
	 
      	
                   

                	 
      
	 
      	 
      	 
      
	 
      	
                  9.3
      TENANT'S SHARE OF DIRECT EXPENSES FOR THE PREMISES

                	
                  100%
      of the Building.

                
	 
      	
                   

                	
                  14.55%
      of the Complex.

                
	 
      	 
      	 
      
	
                  10.

                	
                  SECURITY
      DEPOSIT (ARTICLE 20):

                	
                  One
      Hundred Fifty Thousand Dollars

                
	 
      	 
      	
                  ($150,000.00)

                
	 
      	 
      	 
      
	
                  11.

                	
                  PARKING
      (ARTICLE 23):

                	
                  One
      hundred fourteen (114) unreserved parking spaces, subject to adjustment
      per Article 23

                
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                  12.

                	
                  BROKERS
      (SECTION 24.35):

                	
                  Aegis
      Realty Partners for Tenant

                
	 
      	 
      	
                  Cushman
      Realty Corporation for Landlord

                
	 
      	 
      	 
      
	
                  13.

                	
                  EXHIBITS:

                	
                  A
      through E, inclusive and attached
hereto.

                

        

        

          
            
               

            

            
              iii

              
                

              

            

            
               

            

          

        

         

        PARKWAY
CENTER

         

        OFFICE
LEASE

         

         

        This
Office Lease, which includes the preceding Summary attached hereto and
incorporated herein by this reference (the Office Lease and Summary to be known
sometimes collectively hereafter as the "Lease"), dated as of the date set forth
in Section 1 of the Summary, is made by and between LINCOLN-RECP EMPIRE OPCO,
LLC, a Delaware limited liability company ("Landlord"), and AVIGEN, INC., a
Delaware corporation ("Tenant").

         

         

        ARTICLE
1 - REAL PROPERTY, BUILDING, PREMISES AND COMPLEX

         

         

        1.1 REAL
PROPERTY, BUILDING, PREMISES AND COMPLEX. Upon and subject to the terms,
covenants and conditions hereinafter set forth in this Lease, Landlord hereby
leases to Tenant and Tenant hereby leases from Landlord the premises set forth
in Section 6 of the Summary (the "Premises"), which Premises are part of the
building (the "Building") specified in Section 6 of the Summary, and, as
applicable, which Building is part of the Complex ("Complex") specified in
Section 6 of the Summary. The outline of the floor plan of the Premises is set
forth in Exhibit A attached hereto. The Building, the Building's parking
facility ("Building Parking Facility"), any outside plaza areas, land and other
improvements surrounding the Building which are designated from time to time by
Landlord as "Common Areas" appurtenant to or servicing the Building and/or the
Complex, and the land upon which any of the foregoing are situated, are herein
sometimes collectively referred to as the "Real Property." Landlord and Tenant
hereby agree that for purposes of this Lease, as of the Lease Date, the rentable
square footage area of the Premises, the Building, and the Complex shall be
deemed to be the number of rentable square feet specified in Section 6 of the
Summary which number of rentable square feet for the Premises includes an
apportionment made by Landlord of a pro rata share of the core of the Building,
corridors, lobbies and other portions of the "Common Areas" within the Building
attributable to the Premises being leased by Tenant hereunder. Tenant is hereby
granted the right to the non-exclusive use of the common corridors and hallways,
stairwells, elevators, restrooms and other public or common areas located on the
Real Property (the "Common Areas"); provided, however, that the manner in which
such public and Common Areas are maintained and operated shall be at the sole
discretion of Landlord (but in a good condition, comparable to the condition of
other comparable buildings in the vicinity of the Complex) and the use thereof
shall be subject to such reasonable rules, regulations and restrictions as
Landlord may make from time to time. Landlord reserves the right to make
alterations or additions to or to change the location of elements of the Real
Property and the Common Areas thereof, subject to the condition that exercise of
any of such rights shall not unreasonably interfere with Tenant's use of the
Premises, or decrease the number of Tenant's parking spaces below the minimum
number set forth herein. Tenant hereby acknowledges and agrees that Landlord has
informed Tenant that, as of the date hereof, Landlord presently owns five (5) of
the eight (8) buildings situated within the Complex.

         

        1.2
CONDITION OF PREMISES. No representations or warranties of any kind, express or
implied, respecting the condition of the Premises, Building, Complex or Real
Property have been made by Landlord or any agent of Landlord to Tenant, except
as expressly set forth herein. Tenant acknowledges that it has had an
opportunity to thoroughly inspect the condition of the Premises, and Tenant
accepts the Premises in the existing "AS IS" condition on the date hereof.
Tenant acknowledges and agrees that neither Landlord nor any of Landlord's
agents, representatives or employees has made any representations as to the
suitability, fitness or condition of the Premises for the conduct of Tenant's
business or for any other purpose. Any exception to the foregoing provisions
must be made by express written agreement by both parties. Notwithstanding
anything to the contrary in this Lease, Landlord warrants that on the
commencement of the term hereof, the Premises shall be "broom-clean" and the
Building and the Systems and Equipment, shall be in good working order,
condition, and repair, and free from material defects.

         

        ARTICLE
2 - LEASE TERM

         

        The terms
and provisions of this Lease shall be effective as of the date of this Lease
except for the provisions of this Lease relating to the payment of Rent or any
obligations to maintain, repair or comply with laws. The term of this Lease (the
"Lease Term") shall be as specified in Section 7.1 of the Summary and shall
commence on the date (the "Lease Commencement Date") specified in Section 7.2 of
the Summary, and shall terminate on the date (the "Lease Expiration Date") set
forth in Section 7.3 of the Summary, unless this Lease is sooner terminated as
hereinafter provided. Notwithstanding the foregoing, Tenant hereby acknowledges
that as of the Lease Date, the Premises are presently being occupied by
RESOURCE/PHOENIX, INC., a California corporation (the "Existing Tenant") under a
sublease from PEOPLESOFT USA, INC., a Delaware corporation ("PeopleSoft").
Landlord's delivery to Tenant of possession of the Premises by the Lease
Commencement Date is contingent upon (i) Landlord entering into lease
termination agreements with the Existing Tenant and with PeopleSoft satisfactory
to Landlord, and (ii) the Existing Tenant vacating the Premises and surrendering
possession thereof to Landlord by the Lease Commencement Date; provided that
Landlord shall use commercially reasonable efforts to enter into such lease
termination agreements and cause Existing Tenant to vacate the Premises and
surrender possession thereof to Landlord by the Lease Commencement Date.
Landlord anticipates that Landlord will be able to deliver approximately 34,537
rentable square feet of the Premises on the ground floor of the Building (the
"Initial Premises") to Tenant on or about the Lease Commencement Date; the
balance of the Premises on the second floor of the Building comprising
approximately 32,945 rentable square feet (the "Remaining Premises") is
anticipated to be delivered to Tenant on or about October 1, 2001 (the "RP
Commencement Date"). If Landlord, for any reason whatsoever, cannot deliver
possession of the Initial Premises to Tenant on the Lease Commencement Date,
Landlord shall not be subject to any liability nor shall the validity of the
Lease be affected; provided, the Term of this Lease and the obligation to pay
Rent or any obligations to maintain, repair or comply with laws shall commence
on the date possession is actually tendered to Tenant and the Lease Expiration
Date shall be extended commensurately. If Landlord, for any reason, cannot
deliver possession of the Remaining Premises to Tenant on the RP Commencement
Date (in the condition that exists on the day after the Existing Tenant vacates
the Remaining Premises) without any improvements, alterations, repairs,
refurbishment or other modifications being made thereto (except as may be
necessary to satisfy the requirements of Section 1.2 above), Landlord shall not
be subject to any liability nor shall the validity of this Lease be affected;
provided the RP Commencement Date shall be extended commensurately by the period
of time Landlord is delayed in so delivering possession of the Remaining
Premises to Tenant without any improvements, alterations, repairs, refurbishment
or other modifications being made thereto. For purposes of this Lease, the term
"Lease Year" shall mean each consecutive twelve (12) month period during the
Lease Term, provided that the last Lease Year shall end on the Lease Expiration
Date. If the Lease Commencement Date, the RP Commencement Date and/or the Lease
Expiration Date of this Lease is other than the Lease Commencement Date, the RP
Commencement Date and/or Lease Expiration Date specified in Section 7 of the
Summary, then at any time during the Lease Term, Landlord may deliver to Tenant
an Amendment to Lease in substantially the form as set forth in Exhibit C,
attached hereto, wherein the parties shall specify the actual Lease Commencement
Date, RP Commencement Date, Lease Expiration Date and the dates on which Tenant
is to commence paying Rent for the Initial Premises and the Remaining Premises,
respectively, and which document Tenant shall execute and return to Landlord
within five (5) days of receipt thereof. The word "Lease Term" whenever used
herein refers to the initial term of this Lease and any valid extension(s)
thereof. Notwithstanding the definition of Premises set forth in Section 6.1 of
the Summary, the Premises as used herein shall only refer to that portion of the
Building which has been delivered to Tenant.

         

        
          
             

          

          
            1

            
              

            

          

          
             

          

        

        ARTICLE
3 - BASE RENT

         

        3.1
INITIAL PREMISES RENT COMMENCEMENT DATE. Tenant shall pay, without notice or
demand, to Landlord or Landlord's agent at the management office of the Complex,
or at such other place as Landlord may from time to time designate in writing,
in currency or a check for currency which, at the time of payment, is legal
tender for private or public debts in the United States of America, base rent
("Base Rent") as set forth in Section 8 of the Summary, payable in equal monthly
installments as specified in Section 8 of the Summary as and when required
pursuant to the terms of this Article 3 and thereafter in advance on or before
the first day of each and every month during the Lease Term, without any
abatement, setoff or deduction whatsoever, except as expressly set forth herein.
Tenant's obligation to commence payment of Base Rent for the Initial Premises
shall commence on the Lease Commencement Date. The Base Rent for the first full
month of the Lease Term (the "Advance Rent"), as set forth in Section 8 of the
Summary, shall be paid at the time of Tenant's execution of this Lease. The Base
Rent for any fractional part of a calendar month at the commencement or
termination of the Lease Term shall be a prorated amount of the Base Rent for a
full calendar month based upon the number of days of such month. All other
payments or adjustments required to be made under the terms of this Lease that
require proration on a time basis shall be prorated on the same
basis.

         

        ARTICLE
4 - ADDITIONAL RENT

         

        4.1
ADDITIONAL RENT. For the period commencing on the Lease Commencement Date and
continuing through December 31, 2001 Tenant shall not be required to pay "Direct
Expenses", as defined in Section 4.3.3 of this Lease. Commencing January 1,
2002, and continuing throughout the balance of the Lease Term, Tenant shall pay
as additional rent the "Tenant's Share", as defined in Section 4.3.8, of Direct
Expenses, which are in excess of the amount of Direct Expenses incurred during
the "Base Year," as that term is defined in Section 4.3.1 of this Lease. Such
additional rent, together with any and all other amounts payable by Tenant to
Landlord pursuant to the terms of this Lease (including, without limitation,
pursuant to Article 6), shall be hereinafter collectively referred to as the
"Additional Rent." The Base Rent and Additional Rent are herein collectively
referred to as the "Rent." All amounts due under this Article 4 as Additional
Rent shall be payable for the same periods and in the same manner, time and
place as the Base Rent. Without limitation on other obligations of Tenant which
shall survive the expiration of the Lease Term, the obligations of Tenant to pay
the Additional Rent provided for in this Article 4 which is properly
attributable to the Lease Term shall survive the expiration or earlier
termination of the Lease Term.

        4.2
[INTENTIONALLY DELETED.]

         

        4.3
DEFINITIONS. As used in this Article 4, the following terms shall have the
meanings hereinafter set forth:

         

        4.3.1
"Base Year" shall mean the calendar year set forth in

         

        Section
9.1 of the Summary.

         

        4.3.2
"Calendar Year" shall mean each calendar year in which any portion of the Lease
Term falls, through and including the calendar year in which the Lease Term
expires.

         

        4.3.3
"Direct Expenses" shall mean "Operating Expenses" and "Tax
Expenses."

         

        4.3.4
"Expense Year" shall mean each Calendar Year, provided that Landlord, upon
notice to Tenant, may change the Expense Year from time to time to any other
twelve (12) consecutive-month period, and, in the event of any such change,
Tenant's Share of Direct Expenses shall be equitably adjusted by Landlord for
any Expense Year involved in any such change; provided further that any such
change shall not increase in the aggregate the amount of Direct Expenses payable
by Tenant throughout the Lease Term.

         

        4.3.5
"Operating Expenses" shall mean all expenses, costs and amounts of every kind
and nature which Landlord shall pay during any Expense Year in excess of the
amount of said expenses for the Base Year because of or in connection with the
ownership, management, maintenance, repair, replacement, restoration or
operation of the Building, Complex and Real Property, including, without
limitation, any amounts paid for: (i) the cost of supplying all utilities
(subject to the provisions of Section 6.7), the cost of operating, maintaining,
repairing, renovating and managing the utility systems, mechanical systems,
sanitary and storm drainage systems, any elevator systems and all other "Systems
and Equipment" (as defined in Section 4.3.6 of this Lease), and the cost of
supplies and equipment and maintenance and service contracts in connection
therewith; (ii) the cost of licenses, certificates, permits and inspections, and
the cost of contesting the validity or applicability of any governmental
enactments which may affect Operating Expenses, and the costs incurred in
connection with implementation and operation of any transportation system
management program or similar program required by any governmental authority;
(iii) the cost of insurance carried by Landlord, in such amounts as Landlord may
reasonably determine or as may be required by any mortgagees or the lessor of
any underlying or ground lease affecting the Real Property, the Complex and/or
the Building, including any commercially
reasonable deductibles; (iv) the cost of landscaping, relamping, supplies,
tools, equipment and materials, and all fees, charges and other costs (including
consulting fees, legal fees and accounting fees) incurred in connection with the
management, operation, repair and maintenance of the Building, the Complex and
Real Property; (v) the cost of parking area repair, restoration, and
maintenance; (vi) any equipment rental agreements or management agreements
(including the cost of any management fee and the fair rental value of any
office space provided thereunder); (vii) wages, salaries and other compensation
and benefits of all persons directly engaged (whether or not 100% of such
person's efforts are devoted to this Building, Complex and Real Property,
provided that only the portion attributable to this Building, Complex and Real
Property shall be included in Operating Expenses) in the operation, management,
maintenance or security of the Building, the Complex and the Real Property, and
employer's Social Security taxes, unemployment taxes or insurance, and any other
taxes which may be levied on such wages, salaries, compensation and benefits;
(viii) payments under any easement, license, operating agreement, declaration,
restrictive covenant, underlying or ground lease (excluding rent), or instrument
pertaining to the sharing of costs by the Building, Complex or Real Property;
(ix) the cost of janitorial service, alarm and security service (if any security
service is provided by Landlord), window cleaning, trash removal, replacement of
wall and floor coverings, ceiling tiles and fixtures in lobbies, corridors,
restrooms and other common or public areas or facilities, maintenance and
replacement of curbs and walkways, repair to roofs and re-roofing; (x) any and
all levies, charges, fees and/or assessments payable to any applicable owner's
association and/or condominium association with respect to the Complex; (xi)
amortization (including interest on the unamortized cost) of the cost of
acquiring or the rental expense of personal property used in the maintenance,
operation and repair of the Building, Complex and Real Property; and (xii) the
cost of any capital improvements or other costs (I) which are intended as a
labor-saving device or to effect other economies in the operation or maintenance
of the Building, Complex and Real Property, to the extent that the same result
in savings, and (II) made to the Building, Complex or Real Property after the
Lease Commencement Date that are required under any governmental law or
regulation adopted subsequent to the Commencement Date, or (III) which are
reasonably determined by Landlord to be in the best interests of the Building,
the Complex and/or the Real Property; provided, however, that if any such cost
described in (I), (II) or (III) above, is a capital expenditure, such cost shall
be amortized (including interest on the unamortized cost) over its estimated
useful life as Landlord shall reasonably determine, which estimated useful life
shall be comparable to that used by landlords of comparable buildings in the
vicinity of the Complex. If Landlord is not furnishing any particular work or
service (the cost of which, if performed by Landlord, would be included in
Operating Expenses) to a tenant who has undertaken to perform such work or
service in lieu of the performance thereof by Landlord, Operating Expenses shall
be deemed to be increased by an amount equal to the additional Operating
Expenses which would reasonably have been incurred during such period by
Landlord if it had at its own expense furnished such work or service to such
tenant. If the Building or the Complex is not fully occupied during all or a
portion of any Expense Year (including the Base Year), Landlord shall make an
appropriate adjustment to the variable components of Operating Expenses for such
year or applicable portion thereof, employing sound accounting and management
principles, to determine the amount of Operating Expenses that would have been
paid had the Building and/or the Complex been fully occupied; and the amount so
determined shall be deemed to have been the amount of Operating Expenses for
such year, or applicable portion thereof. Landlord shall have the right, from
time to time, to equitably allocate some or all of the Operating Expenses among
different tenants of the Building and/or the Complex (the "Cost Pools"). Such
Cost Pools may include, without limitation, the office space tenants and retail
space tenants of the Building and/or the Complex. Notwithstanding anything to
the contrary set forth in this Lease, solely for the purpose of calculating the
amount of the Operating Expenses attributable to the Base Year, the term
Operating Expenses shall exclude any costs of any capital improvements or
expenditures (including all costs of a capital nature in any manner arising from
the deregulation of utilities)and any market-wide labor-rate increases due to
extraordinary circumstances, including, but not limited to, boycotts and
strikes, and utility rate increases due to extraordinary circumstances
including, but not limited to, conservation surcharges, boycotts, embargoes or
other shortages.

         

        
          
             

          

          
            2

            
              

            

          

          
             

          

        

        Notwithstanding
the foregoing, Operating Expenses shall not, however, include: (A) costs of
leasing commissions, attorneys' fees and other costs and expenses incurred in
connection with negotiations or disputes with present or prospective tenants or
other occupants of the Building or the Complex; (B) costs (including permit,
license and inspection costs) incurred in renovating or otherwise improving,
decorating or redecorating rentable space for other tenants or vacant rentable
space; (C) costs incurred due to the actual violation by Landlord of the terms
and conditions of any lease of space in the Building or the Complex; (D) costs
of overhead or profit increment paid to Landlord or to subsidiaries or
affiliates of Landlord for services in or in connection with the Building or the
Complex to the extent the same exceeds the costs of overhead and profit
increment included in the costs of such services which could be obtained from
third parties on a competitive basis; (E) except as otherwise specifically
provided in this Section 4.3.5, costs of interest on debt or amortization on any
mortgages, and rent payable under any ground lease of the Complex and/or Real
Property; (F) The cost of any service sold to any tenant (including Tenant) or
other occupant for which Landlord is entitled to be reimbursed as an additional
charge or rental over and above the basic rent and escalations payable under the
lease with that tenant; (G) Costs of a capital nature, except as expressly
provided in subsection (xii) above; (H) unless due to any fault or breach by
Tenant, any costs, fines, or penalties incurred due to violations by Landlord of
any governmental rule or authority, this Lease or any other lease in the
Property, or due to Landlord's gross negligence or willful misconduct; (I)
Management costs to the extent they exceed 5% of Rent; (J) The cost of
correcting any building code or other violations which were violations prior to
the Commencement Date; and (K) Costs associated with the investigation and/or
remediation of Hazardous Materials (hereafter defined) present in, on or about
any portion of the Project, unless such costs and expenses are the
responsibility of Tenant as provided in Section 27 hereof, in which event such
costs and expenses shall be paid solely by Tenant in accordance with the
provisions of Section 27 hereof. Additionally, in no event shall Operating
Expenses for any calendar year (or portion thereof) be less than the component
of Operating Expenses comprising a portion of the Base Year.

         

        4.3.6
"Systems and Equipment" shall mean any plant, machinery, transformers, duct
work, cable, wires, and other equipment, facilities, and systems designed to
supply heat, ventilation, air conditioning and humidity or any other services or
utilities, or comprising or serving as any component or portion of the
electrical, gas, steam, plumbing, sprinkler, communications, alarm, security, or
fire/life safety systems or equipment, or any other mechanical, electrical,
electronic, computer or other systems or equipment which serve the Building in
whole or in part.

         

        
          
             

          

          
            3

            
              

            

          

          
             

          

        

         

        4.3.7
"Tax Expenses" shall mean all federal, state, county, or local governmental or
municipal taxes, fees, assessments, charges or other impositions of every kind
and nature, whether general, supplemental, special, ordinary or extraordinary,
(including, without limitation, real estate taxes, general and special
assessments, transit assessments, fees and taxes, child care subsidies, fees
and/or assessments, job training subsidies, fees and/or assessments, open space
fees and/or assessments, housing subsidies and/or housing fund fees or
assessments, public art fees and/or assessments, leasehold taxes or taxes based
upon the receipt of rent, including gross receipts or sales taxes applicable to
the receipt of rent, personal property taxes imposed upon the fixtures,
machinery, equipment, apparatus, systems and equipment, appurtenances, furniture
and other personal property used in connection with the Real Property), which
Landlord shall pay during any Expense Year because of or in connection with the
ownership, leasing and operation of the Complex and Real Property or Landlord's
interest therein.

         

        4.3.7.1
Tax Expenses shall include, without limitation:

         

        (i) Any
tax on Landlord's rent, right to rent or other income from the Complex and/or
the Real Property or as against Landlord's business of leasing any of the
Complex or the Real Property;

         

        (ii) Any
assessment, tax, fee, levy or charge in addition to, or in substitution,
partially or totally, of any assessment, tax, fee, levy or charge previously
included within the definition of real property tax, it being acknowledged by
Tenant and Landlord that Proposition 13 was adopted by the voters of the State
of California in the June 1978 election ("Proposition 13") and that assessments,
taxes, fees, levies and charges may be imposed by governmental agencies for such
services as fire protection, street, sidewalk and road maintenance, refuse
removal and for other governmental services formerly provided without charge to
property owners or occupants. It is the intention of Tenant and Landlord that
all such new and increased assessments, taxes, fees, levies, and charges and all
similar assessments, taxes, fees, levies and charges be included within the
definition of Tax Expenses for purposes of this Lease;

         

        (iii) Any
assessment, tax, fee, levy, or charge allocable to or measured by the area of
the Premises or the rent payable hereunder, including, without limitation, any
gross income tax upon or with respect to the possession, leasing, operating,
management, maintenance, alteration, repair, use or occupancy by Tenant of the
Premises, or any portion thereof;

         

        (iv) Any
assessment, tax, fee, levy or charge, upon this transaction or any document to
which Tenant is a party, creating or transferring an interest or an estate in
the Premises; and

         

        (v) Any
reasonable expenses incurred by Landlord in attempting to protest, reduce or
minimize Tax Expenses.

        4.3.7.2
In no event shall the Tax Expenses for any Expense Year be less than the amount
of Tax Expenses for the Base Year.

         

        4.3.7.3
Notwithstanding anything to the contrary contained in this Section 4.3.7, there
shall be excluded from Tax Expenses (i) all excess profits taxes, franchise
taxes, gift taxes, capital stock taxes, inheritance and succession taxes, estate
taxes, federal and state net income taxes, and other taxes to the extent
applicable to Landlord's net income (as opposed to rents, receipts or income
attributable to operations at the Building, Complex or Real Property), (ii) any
items included as Operating Expenses, (iii) any costs, fines or penalties
payable by Landlord as a result of any delinquent payment of a Tex Expense,
unless due to a fault or breach by Tenant, and (iv) any items paid by Tenant
under Section 4.5 of this Lease.

         

        4.3.8
"Tenant's Share" shall mean the percentage(s) set forth in

         

        Section
9.3 of the Summary. The Tenant's Share for the Building was calculated by
multiplying the number of rentable square feet of the Premises by 100 and
dividing the product by the total rentable square feet in the Building. In the
event either the rentable square feet of the Premises and/or the total rentable
square feet of the Building is changed, the Tenant's Share for the Building
shall be appropriately adjusted, and, as to the Expense Year in which such
change occurs, the Tenant's Share for the Building for such year shall be
determined on the basis of the number of days during such Expense Year that each
such Tenant's Share for the Building was in effect. The Tenant's Share for the
Complex was calculated by multiplying the number of rentable square feet of the
Premises by 100 and dividing the product by the total rentable square feet in
the Complex. In the event either the rentable square feet of the Building and/or
the total rentable square feet of the Complex is changed, the Tenant's Share for
the Complex shall be appropriately adjusted, and, as to the Expense Year in
which such change occurs, the Tenant's Share for the Complex for such year shall
be determined on the basis of the number of days during such Expense Year that
each such Tenant's Share for the Complex was in effect. Landlord represents that
the rentable square footage of the Premises, Building and Complex were all
measured by the same methodology.

         

        4.4
CALCULATION AND PAYMENT OF ADDITIONAL RENT.

         

        4.4.1
CALCULATION OF EXCESS. If for any Expense Year ending or commencing within the
Lease Term, Tenant's Share of Direct Expenses for such Expense Year exceeds
Tenant's Share of Direct Expenses for the Base Year, then Tenant shall pay to
Landlord, in the manner set forth in Section 4.4.2, below, and as Additional
Rent, an amount equal to the excess (the "Excess").

         

        4.4.2
STATEMENT OF ACTUAL DIRECT EXPENSES AND PAYMENT BY TENANT.

         

        4.4.2.1
Landlord shall endeavor to give to Tenant on or before the first day of the
sixth month following the end of each Calendar Year, a statement (the
"Statement") which shall state the Direct Expenses incurred or accrued for such
preceding Expense Year, and which shall indicate the amount, if any, of any
Excess. Upon receipt of the Statement for each Expense Year ending during the
Lease Term, if an Excess is present, Tenant shall pay, with its next installment
of Base Rent due, the full amount of the Excess for such Expense Year, less the
amounts, if any, paid during such Expense Year as "Estimated Excess," as that
term is defined in Section
4.4.3 of this Lease. In the event that the amount paid by Tenant during such
Expense Year as an Estimated Excess exceeds the actual Direct Expenses, Landlord
shall remit such difference to Tenant within thirty (30) days. The failure of
Landlord to timely furnish the Statement for any Expense Year shall not
prejudice or prevent Landlord from enforcing its rights under this Article 4.
Even though the Lease Term has expired and Tenant has vacated the Premises, when
the final determination is made of Tenant's Share of the Direct Expenses for the
Expense Year in which this Lease terminates, if an Excess is present, Tenant
shall immediately pay to Landlord an amount as calculated pursuant to the
provisions of Section 4.4.1 of this Lease, and any overpayment by Tenant shall
be returned to Tenant within thirty (30) days.

        
          
             

          

          
            4

            
              

            

          

          
             

          

        

        4.4.2.2
After delivery to Landlord of at least thirty (30) days' prior written notice,
Tenant, at its sole cost and expense through any accountant designated by it,
shall have the right to examine and/or audit the books and records evidencing
such costs and expenses for the previous one (1) calendar year, during
Landlord's reasonable business hours but not more frequently than once during
any calendar year. Any such accounting firm designated by Tenant may not be
compensated on a contingency fee basis. The results of any such audit (and any
negotiations between the parties related thereto) shall be maintained strictly
confidential by Tenant and its accounting firm and shall not be disclosed,
published or otherwise disseminated to any other party other than to Landlord
and its authorized agents. Landlord and Tenant each shall use its best efforts
to cooperate in such negotiations and to promptly resolve any discrepancies
between Landlord and Tenant in the accounting of such costs and expenses. If
through such audit it is conclusively determined that there is a discrepancy of
more than seven percent (7%) of the total expenses, then Landlord shall
reimburse Tenant for Tenant's reasonable out-of-pocket accounting costs and
expenses incurred by Tenant in performing such audit. However, if through such
audit it is conclusively determined that there is a discrepancy of seven percent
(7%) or less, then Tenant shall reimburse Landlord for the reasonable
out-of-pocket costs and expenses incurred by Landlord in connection with such
audit.

         

        4.4.2.3
The provisions of this Section 4.4.2 shall survive the expiration or earlier
termination of the Lease Term.

         

        4.4.3
STATEMENT OF ESTIMATED DIRECT EXPENSES. In addition, Landlord shall endeavor to
give Tenant a yearly expense estimate statement (the "Estimate Statement") which
shall set forth Landlord's reasonable estimate (the "Estimate") of what the
total amount of Direct Expenses for the then-current Expense Year, beginning
with calendar year 2002, shall be and the estimated Excess (the "Estimated
Excess") as calculated by comparing Tenant's Share of Direct Expenses, which
shall be based upon the Estimate, to Tenant's Share of Direct Expenses for the
Base Year. The failure of Landlord to timely furnish the Estimate Statement for
any Expense Year shall not preclude Landlord from enforcing its rights to
collect any Estimated Excess under this Article 4. Commencing January 1, 2002,
if pursuant to the Estimate Statement an Estimated Excess is calculated for the
then-current Expense Year, Tenant shall pay, with its next installment of Base
Rent due, a fraction of the Estimated Excess for the then-current Expense Year
(reduced by any amounts paid pursuant to the last sentence of this Section
4.4.3). Such fraction shall have as its numerator the number of months which
have elapsed in such current Expense Year to the month of such payment, both
months inclusive, and shall have twelve (12) as its denominator. Until a new
Estimate Statement is furnished, Tenant shall pay monthly, with the monthly Base
Rent installments, an amount equal to one-twelfth (1/12) of the total Estimated
Excess set forth in the previous Estimate Statement delivered by Landlord to
Tenant.

        4.5 TAXES
AND OTHER CHARGES FOR WHICH TENANT IS DIRECTLY RESPONSIBLE. Tenant shall
reimburse Landlord upon demand for any and all taxes or assessments required to
be paid by Landlord (except to the extent included in Tax Expenses by Landlord),
excluding state, local and federal personal or corporate income taxes measured
by the net income of Landlord from all sources, and estate and inheritance
taxes, whether or not now customary or within the contemplation of the parties
hereto, when:

         

        4.5.1
Said taxes are measured by or reasonably attributable to the cost or value of
Tenant's equipment, furniture, fixtures and other personal property located in
the Premises, or by the cost or value of any leasehold improvements made in or
to the Premises by or for Tenant, to the extent the cost or value of such
leasehold improvements exceeds the cost or value of a building standard
build-out as determined by Landlord regardless of whether title to such
improvements shall be vested in Tenant or Landlord;

         

        4.5.2
Said taxes are assessed upon or with respect to the possession, leasing,
operation, management, maintenance, alteration, repair, use or occupancy by
Tenant of the Premises or any portion of the Complex and Real Property
(including the Building Parking Facility); or

         

        4.5.3
Said taxes are assessed upon this transaction or any document to which Tenant is
a party creating or transferring an interest or an estate in the
Premises.

         

        4.6 LATE
CHARGES. If any installment of Rent or any other sum due from Tenant shall not
be received by Landlord or Landlord's designee by the due date therefor, then
Tenant shall pay to Landlord a late charge equal to five percent (5%) of the
amount due plus any attorneys' fees incurred by Landlord by reason of Tenant's
failure to pay Rent and/or other charges when due hereunder. The late charge
shall be deemed Additional Rent and the right to require it shall be in addition
to all of Landlord's other rights and remedies hereunder, at law and/or in
equity and shall not be construed as liquidated damages or as limiting
Landlord's remedies in any manner. In addition to the late charge described
above, any Rent or other amounts owing hereunder which are not paid by the date
that they are due shall thereafter bear interest until paid at a rate (the
"Interest Rate") equal to the lesser of (i) the "Prime Rate" or "Reference Rate"
announced from time to time by the Bank of America (or such reasonable
comparable national banking institution as selected by Landlord in the event
Bank of America ceases to exist or publish a Prime Rate or Reference Rate), plus
four percent (4%), or (ii) the highest rate permitted by applicable law. If a
late charge or other charge becomes payable for any three (3) installments of
Rent within any twelve (12) month period, then Landlord, at Landlord's sole
option, can either require the Rent be paid quarterly in advance, or be paid
monthly in advance by cashier's check or by electronic funds
transfer.

        
          
             

          

          
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        ARTICLE
5 - USE OF PREMISES

         

        Tenant
shall use the Premises solely for general office purposes consistent with the
character of the Building of a high quality nature and approved biotechnology
laboratory use, to the extent permitted by the City of Alameda and all
governmental authorities having jurisdiction thereof, and Tenant shall not use
or permit the Premises to be used for any other purpose or purposes whatsoever.
Tenant further covenants and agrees that it shall not use, or suffer or permit
any person or persons to use, the Premises or any part thereof for any use or
purpose contrary to the provisions of Exhibit D, attached hereto, or in
violation of the laws of the United States of America, the state in which the
Building is located, or the ordinances, regulations or requirements of the local
municipal or county governing body or other lawful authorities having
jurisdiction over the Building. Tenant shall not violate any provisions of any
ground or underlying leases, now or hereafter affecting the Building, Complex
and/or Real Property. Tenant shall also not violate any documents, matters or
instruments, including without limitation, any declarations of covenants,
conditions and restrictions, and any supplements thereto, each of which has been
or hereafter is recorded in any official or public records with respect to the
Premises, Building, Complex and/or Real Property, or any portion thereof. Tenant
agrees to, and does hereby, assume full and complete responsibility to ensure
that the Premises are adequate to fully meet the needs and requirements of
Tenant's intended operations of its business within the Premises, and Tenant's
use of the Premises and that same are in compliance with all applicable Laws
throughout the Lease Term. Additionally, Tenant shall be solely responsible for
the payment of all costs, fees and expenses associated with any modifications,
improvements or Alterations to the Premises, the Building, the Common Areas, the
Complex and/or the Real Property occasioned by the enactment of, or changes to,
any Laws arising from Tenant's particular use of the Premises or Alterations,
improvements or additions made to the Premises regardless of when such Laws
became effective. Tenant shall not do or permit anything to be done in or about
the Premises which will in any way obstruct or interfere with the rights of
Landlord, other tenants or occupants of the Building, other buildings in the
Complex, or other persons or businesses in the area, or injure or annoy other
tenants or use or allow the Premises to be used for any unlawful or
objectionable purpose, as determined by Landlord, in its reasonable discretion.
Tenant shall not cause, maintain or permit any private or public nuisance in, on
or about the Premises, Building, Common Areas, Complex and/or Real Property,
including, but not limited to, any offensive odors, noises, fumes or vibrations.
Tenant shall not damage or deface or otherwise commit or suffer to be committed
any waste in, upon or about the Premises. Tenant shall not place or store, nor
permit any other person or entity to place or store, any property, equipment,
materials, supplies, personal property or any other items or goods outside of
the Premises for any period of time. Tenant shall not install any radio or
television antenna, loudspeaker or other device on the roof or exterior walls of
the Building, without the prior written consent of the Landlord, which consent
shall not be unreasonably withheld, conditioned or delayed. In all circumstances
Tenant shall not interfere with radio or television broadcasting or reception or
other telecommunications broadcasting or reception from or in the Building or
elsewhere. Tenant shall place no loads upon the floors, walls, or ceilings of
the Premises in excess of the average pounds of live load per square foot floor
area specified for the Building by the applicable Uniform Building Code or which
may damage the Building or outside areas, with the partitions to be considered a
part of the live load. Landlord reserves the right to prescribe the weight and
position of all safes, files and heavy equipment which Tenant desires to place
in the Premises so as to distribute properly the weight thereof. Tenant's
business machines and mechanical equipment which cause vibration or noise that
may be transmitted to the Building structure or to any other space in the
Building shall be so installed, maintained and used by Tenant as to eliminate
such vibration or noise. Tenant shall be responsible for all structural
engineering required to determine structural load. Landlord shall not be
responsible for any damage or liability for any of such events. Tenant hereby
acknowledges and agrees that Landlord has informed Tenant that noise produced by
aircraft used at the Metropolitan Oakland International Airport
(the "Airport") which adjoins the Complex may be heard at the Premises. Tenant
further acknowledges and agrees that Landlord has informed Tenant that the
Premises are subject to a recorded noise easement and release pursuant to which
the owners of the Airport are released from any claims or lawsuits for damages
by any persons or entities using the Complex (including without limitation,
Tenant) with respect to airport operations, including without limitation,
aircraft related noise. Tenant shall, and hereby agrees to, indemnify, defend,
protect, and hold harmless the Landlord Parties (hereafter defined in Article
10) from and against all liabilities, damages, claims, losses, judgments,
charges and expenses (including reasonable attorneys' fees, costs of court and
expenses necessary in the prosecution or defense of any litigation including the
enforcement of this provision) arising from or in any way related to, directly
or indirectly, any claims made by Tenant, any employee, agent or invitee of
Tenant, or any person claiming by or through Tenant with respect to such airport
operations, including without limitation, aircraft related
noise.

        ARTICLE
6 - SERVICES AND UTILITIES

         

        6.1
STANDARD TENANT SERVICES. Landlord shall provide the following services on all
days during the Lease Term, unless otherwise stated below.

         

         

        6.1.1
Subject to reasonable changes implemented by Landlord and to all governmental
rules, regulations and guidelines applicable thereto, Landlord shall provide
heating and air conditioning when necessary for normal comfort for normal office
use in the Premises, from Monday through Friday, during the period from 8:00
a.m. to 6:00 p.m., except for the date of observation of New Year's Day,
Presidents' Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day,
Christmas Day and other locally or nationally recognized holidays (collectively,
the "Holidays").

         

         

        6.1.2
Landlord shall provide adequate electrical wiring and facilities and power for
normal general office use as reasonably determined by Landlord. Tenant shall
bear the cost of replacement of lamps, starters and ballasts for lighting
fixtures within the Premises.

         

         

        6.1.3
Landlord shall provide city water from the regular Building outlets for
drinking, lavatory and toilet purposes, and for laboratory use to the extent
that such does not exceed the quantity that would be used for normal office
use.

         

        6.1.4
Landlord shall provide janitorial services five (5) days per week, except the
date of observation of the Holidays, in and about the Premises and window
washing services in a manner consistent with other comparable buildings in the
vicinity of the Building.

        
          
             

          

          
            6

            
              

            

          

          
             

          

        

        6.1.5
Landlord shall provide non-exclusive automatic passenger elevator service at all
times.

         

        6.1.6
Landlord shall provide non-exclusive freight elevator service subject to
scheduling by Landlord.

         

        6.2
OVERSTANDARD TENANT USE. Tenant shall not, without Landlord's prior written
consent, use heat-generating machines, machines other than normal fractional
horsepower office machines, or equipment or lighting other than building
standard lights in the Premises, which may affect the temperature otherwise
maintained by the air conditioning system or increase the water normally
furnished for the Premises by Landlord pursuant to the terms of Section 6.1 of
this Lease. If Tenant uses water or heat or air conditioning in excess of that
supplied by Landlord pursuant to Section 6.1 of this Lease, or if Tenant's
consumption of electricity shall exceed six (6) watts per usable square foot of
the Premises, calculated on an annualized basis for the hours described in
Section
6.1.1 above, Tenant shall pay to Landlord, within ten (10) days after billing,
the cost of such excess consumption, the cost of the installation, operation,
and maintenance of equipment which is installed in order to supply such excess
consumption, and the cost of the increased wear and tear on existing equipment
caused by such excess consumption; and Landlord may install devices to
separately meter any increased use and in such event Tenant shall pay the
increased cost directly to Landlord, within ten (10) days after demand,
including the cost of such additional metering devices. If Tenant desires to use
heat, ventilation or air conditioning during hours other than those for which
Landlord is obligated to supply such utilities pursuant to the terms of Section
6.1 of this Lease, (i) Tenant shall give Landlord such prior notice, as Landlord
shall from time to time establish as appropriate, of Tenant's desired use, (ii)
Landlord shall supply such utilities to Tenant at such hourly cost to Tenant as
Landlord shall from time to time reasonably establish, based on Landlord's
actual costs therefor, and (iii) Tenant shall pay such cost within ten (10) days
after billing.

         

        6.3
INTERRUPTION OF USE. Tenant agrees that Landlord shall not be liable for
damages, by abatement of Rent or otherwise, for failure to furnish or delay in
furnishing any service (including telephone and telecommunication services), or
for any diminution in the quality or quantity thereof, when such failure or
delay or diminution is occasioned, in whole or in part, by repairs,
replacements, or improvements, by any strike, lockout or other labor trouble, by
inability to secure electricity, gas, water, or other fuel at the Building after
reasonable effort to do so, by any accident or casualty whatsoever, by act or
default of Tenant or other parties, or by any other cause beyond Landlord's
reasonable control; and such failures or delays or diminution shall never be
deemed to constitute an eviction or disturbance of Tenant's use and possession
of the Premises or relieve Tenant from paying Rent or performing any of its
obligations under this Lease. Furthermore, Landlord shall not be liable under
any circumstances for a loss of, or injury to, property or for injury to, or
interference with, Tenant's business, including, without limitation, loss of
profits, however occurring, through or in connection with or incidental to a
failure to furnish any of the services or utilities as set forth in this Article
6.
Notwithstanding the foregoing, if an interruption or cessation of utilities
results from the gross negligence or willful misconduct of Landlord, or its
employees, agents and contractors, and not due to any fault or breach by Tenant,
and the Premises are not usable by Tenant for the conduct of Tenant's business
as a result thereof, Base Rent and applicable Direct Expenses not actually
incurred up to that point by Tenant shall be abated for the period which
commences five (5) business days after the date Tenant gives to Landlord notice
of such interruption until such utilities are restored.

        6.4
ADDITIONAL SERVICES. Tenant shall provide Landlord the right of first offer with
respect to any additional services which may be required by Tenant, including,
without limitation, locksmithing, lamp replacement, additional janitorial
service, and additional repairs and maintenance, provided that Tenant shall pay
to Landlord upon billing, the sum of all costs to Landlord of such additional
services plus an administration fee not to exceed five percent (5%) of such
costs. Charges for any utilities or service for which Tenant is required to pay
from time to time hereunder, shall be deemed Additional Rent hereunder and shall
be billed on a monthly basis.

         

        6.5
ALTERNATE ELECTRIC SERVICE PROVIDER. Notwithstanding anything to the contrary
contained herein, if permitted by applicable Laws, Landlord shall have the right
at any time and from time to time during the Term of this Lease to either
contract for service from a different company or companies (each such company
shall be referred to herein as an "Alternate Service Provider") other than the
company or companies presently providing electricity service for the Building,
the Complex or the Real Property (the "Electric Service Provider") or continue
to contract for service from the Electric Service Provider, at Landlord's sole
discretion. Tenant hereby agrees to cooperate with Landlord, the Electric
Service Provider, and any Alternate Service Provider at all times and, as
reasonably necessary, shall allow Landlord, the Electric Service Provider, and
any Alternate Service Provider reasonable access to the Building's electric
lines, feeders, risers, wiring, and any other machinery within the
Premises.

         

        6.6
OFFICE AND COMMUNICATIONS SERVICES.

         

        6.6.1
Landlord has advised Tenant that certain office and communications services may
be offered to tenants of the Building by a concessionaire under contract to
Landlord ("Provider"). Tenant shall be permitted to contract with Provider for
the provision of any or all of such services on such terms and conditions as
Tenant and Provider may agree. Tenant shall also be permitted to obtain office
and communications services from any other reputable person or entity in the
business of providing the same (herein called an "Alternate Provider"), provided
that Landlord shall not be required thereby to make any alterations in or to any
part of the Building or the use of any facilities or equipment of the Building,
and provided further that no such services provided by an Alternate Provider, or
any equipment or facilities used or to be used in connection therewith shall be
incompatible in any respect with, or shall interfere with or otherwise impair or
adversely affect, the operation, reliability or quality of the Building systems
or any services, equipment or facilities used or operated by Provider or any
other tenant in the Building.

         

        6.6.2
Tenant acknowledges and agrees that: (i) Landlord has made no warranty or
representation to Tenant with respect to the availability of any such services,
whether provided by Provider or any Alternate Provider, or the quality,
reliability or suitability thereof; (ii) neither Provider nor any Alternate
Provider is acting as the agent or representative of Landlord in the provision
of such services, and Landlord shall have no liability or responsibility for any
failure or inadequacy of such services or any equipment or facilities used in
the furnishing thereof, or any act or omission of Provider or any Alternate
Provider or their agents, employees, representatives, officers or contractors;
(iii) Landlord shall have no responsibility or liability for the installation,
alteration, repair, maintenance, furnishing, operation adjustment or removal of
any such services, equipment or facilities; and (iv) any contract or other
agreement between Tenant and Provider or any Alternate Provider shall be
independent of this Lease, the obligations of Tenant hereunder, and the rights
of Landlord hereunder. Without limiting the generality of the foregoing, no
default or failure of Provider or any Alternate Provider with respect to any
such services, equipment, facilities, or under any contract or agreement
relating thereto, shall have any effect on this Lease or give to Tenant any
offset or defense to the full and timely performance of its obligations
hereunder, or entitle Tenant to any abatement of Rent or Additional Rent or any
other payment required to be made by Tenant hereunder, or constitute any actual
or constructive eviction of Tenant, or otherwise give rise to any other claim of
any nature against Landlord.

        
          
             

          

          
            7

            
              

            

          

          
             

          

        

        6.7
UTILITIES FOR LABORATORY SPACE. In the event Tenant constructs a laboratory
within the Premises, Tenant shall cause such laboratory to be separately metered
and shall pay the utility companies directly for the cost of any utilities. In
the event Tenant pays the utility companies directly for the cost of any
utilities, costs for such utilities shall not be included in Direct
Expenses.

         

        ARTICLE
7 - REPAIRS

         

        7.1
TENANT'S REPAIRS. Subject to Landlord's repair obligations set forth in Sections
7.2, 11.1, and 12 below, Tenant shall, at Tenant's own expense, keep and
maintain the Premises, including all improvements, fixtures and furnishings
therein, in good and safe order, repair and condition at all times during the
Lease Term, which repair obligations shall include, without limitation, the
obligation to promptly and adequately repair all damage to the Premises and
replace or repair all damaged or broken fixtures and appurtenances; provided,
however, that, at Landlord's option if Tenant fails to make such repairs,
Landlord may, but need not, make such repairs and replacements, and Tenant shall
pay Landlord the cost thereof, including a percentage of the cost thereof (to be
uniformly established for the Building) sufficient to reimburse Landlord for all
overhead, general conditions, fees and other costs or expenses arising from
Landlord's involvement with such repairs and replacements forthwith upon being
billed for same, not to exceed five percent (5%) of the cost
thereof.

         

        7.2
LANDLORD'S REPAIRS. Anything contained in Section 7.1 above to the contrary
notwithstanding, and subject to the provisions of Articles 11 and 12 of this
Lease, Landlord shall repair and maintain the structural portions of the
Building, roof (structure and membrane), foundation, and Systems and Equipment
including without limitation the basic plumbing, heating, ventilating, air
conditioning and electrical systems installed or furnished by Landlord (but not
including any non-base building facilities installed by or on behalf of Tenant);
provided, however, if such maintenance and repairs are caused in part or in
whole by the act, neglect, fault of or omission of any duty by Tenant or its
agents, servants, contractors, assignees, subtenants, employees or invitees,
Tenant shall pay to Landlord as additional rent, the reasonable cost of such
maintenance and repairs. Landlord shall not be liable for any failure to make
any such repairs, or to perform any maintenance unless such failure shall
persist for an unreasonable time after written notice of the need of such
repairs or maintenance is given to Landlord by Tenant. There shall be no
abatement of rent and no liability of Landlord by reason of any injury to or
interference with Tenant's business arising from the making of any repairs,
alterations or improvements in or to any portion of the Complex, the Building or
the Premises or in or to fixtures, appurtenances and equipment therein. Tenant
hereby waives and releases its right to make repairs at Landlord's expense under
Sections 1941 and 1942 of the California Civil Code; or under any similar law,
statute, or ordinance now or hereafter in effect.

         

        ARTICLE
8 - ADDITIONS AND ALTERATIONS

         

        8.1
LANDLORD'S CONSENT TO ALTERATIONS. Tenant may not make any improvements,
alterations, additions or changes to the Premises (collectively, the
"Alterations") without first procuring the prior written consent of Landlord to
such Alterations, which consent shall be requested by Tenant not less than
thirty (30) days prior to the commencement thereof, and which consent shall not
be unreasonably withheld, conditioned, or delayed by Landlord; provided,
however, Landlord may withhold its consent in its sole and absolute discretion
with respect to any Alterations which may affect the structural components of
the Building. Subject to section 8.2 below, Landlord hereby expressly grants to
Tenant the right to make roof penetrations in connection with Tenant's
alterations or improvements, subject to obtaining the prior written consent of
Landlord as to the location and manner of installation of any such roof
penetration, which consent shall not be unreasonably withheld, conditioned or
delayed. Tenant shall pay for all overhead, general conditions, fees and other
costs and expenses of the Alterations, and shall pay to Landlord a Landlord
supervision fee of five percent (5%) of the cost of the
Alterations.

         

        8.2
MANNER OF CONSTRUCTION.

         

        8.2.1
Landlord may impose, as a condition of its consent to all Alterations or repairs
of the Premises or about the Premises, such requirements as Landlord in its
reasonable discretion may deem desirable, including, but not limited to, the
requirement that Tenant utilize for such purposes only contractors, materials,
suppliers, mechanics and materialmen approved by Landlord (which shall not be
unreasonably withheld, conditioned, or delayed); provided, however, Landlord may
impose such requirements as Landlord may determine, in its sole and absolute
discretion, with respect to any work affecting the structural components of the
Building, Systems, Roof and/or Equipment (including designating specific
contractors to perform such work). Tenant shall construct such Alterations and
perform such repairs in conformance with any and all applicable rules and
regulations of any federal, state, county or municipal code or ordinance and
pursuant to a valid building permit, mechanical permit, electrical permit and
all other permits (as applicable), issued by the city in which the Building is
located, and in conformance with Landlord's reasonable construction rules and
regulations. Landlord's approval of the plans, specifications and working
drawings for Tenant's Alterations shall create no responsibility or liability on
the part of Landlord for their completeness, design sufficiency, or compliance
with all laws, rules and regulations of governmental or quasi-governmental
agencies or authorities. All work with respect to any Alterations must be done
in a good and workmanlike manner and diligently prosecuted to completion to the
end that the Premises shall at all times be a complete unit except during the
period of work. In performing the work of any such Alterations, Tenant shall
have the work performed in such manner as not to obstruct or materially impair
access to the Building or the Common Areas for any other tenant of the Building,
and as not to obstruct the business of Landlord or other tenants in the
Building, or interfere with the labor force working in the Building. If Tenant
makes any Alterations, Tenant agrees to carry "Builder's All Risk" insurance in
an amount reasonably approved by Landlord covering the construction and
completion of such Alterations, and such other insurance as Landlord may
require, it being understood and agreed that all of such Alterations shall be
insured by Tenant pursuant to Article 10 of this Lease immediately upon
completion thereof. In addition, Landlord may, in its discretion, require Tenant
to obtain a lien and completion bond or some alternate form of security
satisfactory to Landlord in an amount sufficient to ensure the lien-free
completion of such Alterations the cost of which exceed $100,000 and naming
Landlord as a co-obligee. Upon completion of any Alterations, Tenant shall (i)
cause a Notice of Completion to be recorded in the office of the Recorder of the
county in which the Building is located in accordance with Section 3093 of the
Civil Code of the State of California or any successor statute, (ii) deliver to
the Building management office a reproducible copy of the "as built" drawings of
the Alterations, (iii) deliver to Landlord a true and complete copy of the
recorded Notice of Completion, and (iv) deliver to Landlord evidence of payment,
contractors' affidavits and full and final waivers of all liens for labor,
services or materials.

        
          
             

          

          
            8

            
              

            

          

          
             

          

        

        8.2.2 Any
Alterations that require any penetration of the Roof shall only be permitted to
the extent permitted by the City of Alameda and all agencies and governmental
authorities having jurisdiction thereof. The location and size of any roof-top
equipment shall be subject to Landlord's approval, not to unreasonably withheld,
and which best promotes the safety, aesthetics and efficiency of any roof-top
equipment; provided, all of the roof-top equipment and any modifications thereto
or placement thereof shall be (i) at Tenant's sole cost and expense, (ii)
contained visually within the roof screen, (iii) installed and operated to
Landlord's reasonable specifications, and (iv) installed, maintained, operated
and removed in accordance with all Development Documents, Recorded Matters,
Rules and Regulations, applicable Laws, and the provisions of Section 10 of this
Lease. For purposes hereof, any such equipment shall be construed as part of the
Tenant's Property and shall be removed by Tenant at the expiration or earlier
termination of this Lease in accordance with the provisions of this Lease. All
modifications to the Building, including the Roof, if any, shall be reasonably
approved by Landlord prior to commencement of any work with respect to the
Equipment. Tenant shall restore the Roof and any other portion of the Building
affected by any roof-top equipment to its original condition, excepting ordinary
wear and tear and/or damage or destruction due to fire or other casualty not
caused directly or indirectly by Tenant, its agents, employees, contractors or
the Equipment or any part thereof. Notwithstanding anything to the contrary
contained herein, Tenant may not assign, lease, rent, sublet or otherwise
transfer any of its interest in the Roof or any roof-top equipment except
together with the remainder of all of the Premises as more particularly set
forth in Section 14. Each of the other provisions of this Lease shall be
applicable to any roof-top equipment and the use of the Roof by Tenant,
including without limitation, Sections 11 and 12 of this Lease. Any roof-top
equipment shall comply with all rules and regulations of any agencies having
jurisdiction thereof. In addition, Tenant shall be solely responsible for
insuring any roof-top equipment, and Landlord shall have no responsibility
therefor. Tenant shall indemnify, defend (by counsel reasonably acceptable to
Landlord) and hold harmless Landlord and the other Indemnitees from and against
any and all claims, demands, liabilities, damages, judgments, losses, penalties,
costs and expenses (including reasonable attorneys' fees) Landlord may suffer or
incur arising out of or related to the installation, use, operation,
maintenance, replacement and/or removal of any roof-top equipment or any portion
thereof, including without limitation, the cost of repairs and replacements to
the roof of the Building occasioned by the installation, maintenance, repairs
and removal of any roof-top equipment.

        8.3
LANDLORD'S PROPERTY. All Alterations, improvements, fixtures (other than
Tenant's trade fixtures) and/or equipment which may be installed or placed in or
about the Premises, and all signs installed in, on or about the Premises, from
time to time, shall be at the sole cost of Tenant and shall, upon expiration or
earlier termination of this Lease, become the property of Landlord. Furthermore,
Landlord may require that Tenant remove any sign, equipment, trade fixture,
improvement or Alteration upon the expiration or early termination of the Lease
Term, and repair any damage to the Premises and Building caused by such removal.
If Tenant fails to complete such removal and/or to repair any damage caused by
the removal of any sign, equipment, trade fixture, improvement or Alteration,
Landlord may do so and may charge the cost thereof to Tenant.

         

        ARTICLE
9 - COVENANT AGAINST LIENS

         

        Tenant
has no authority or power to cause or permit any lien or encumbrance of any kind
whatsoever, whether created by act of Tenant, operation of law or otherwise, to
attach to or be placed upon the Real Property, Complex, Building or Premises,
and any and all liens and encumbrances created by Tenant shall attach to
Tenant's interest only. Landlord shall have the right at all times to post and
keep posted on the Premises any notice which it deems necessary for protection
from such liens. Tenant covenants and agrees not to suffer or permit any lien of
suppliers, mechanics or materialmen or others to be placed against the Real
Property, the Complex, the Building or the Premises with respect to work or
services claimed to have been performed for or materials claimed to have been
furnished to Tenant or the Premises, and, in case of any such lien attaching or
notice of any lien, Tenant covenants and agrees to cause it to be immediately
released and removed of record. Notwithstanding anything to the contrary set
forth in this Lease, if any such lien is not released and removed on or before
fifteen (15) days following the date notice of such lien is delivered by
Landlord to Tenant, Landlord, at its sole option, may immediately take all
action necessary to release and remove such lien, without any duty to
investigate the validity thereof, and all sums, costs and expenses, including
reasonable attorneys' fees and costs, incurred by Landlord in connection with
such lien shall be deemed Additional Rent under this Lease and shall immediately
be due and payable by Tenant.

         

        ARTICLE
10 - INDEMNIFICATION AND INSURANCE

         

        10.1
INDEMNIFICATION AND WAIVER. Tenant's obligations pursuant to this Article 10
shall apply, throughout the Lease Term, to both the Initial Premises and the
Remaining Premises. Unless due to Landlord's gross negligence, willful
misconduct or a breach by Landlord hereunder, Tenant hereby assumes all risk of
damage to property and injury to persons, in, on, or about the Premises from any
cause whatsoever and agrees that Landlord, and its members, submembers, partners
and subpartners, and their respective officers, agents, property managers,
employees, and independent contractors (collectively, "Landlord Parties") shall
not be liable for, and are hereby released from any responsibility for, any
damage to property or injury to persons or resulting from the loss of use
thereof, which damage or injury is sustained by Tenant or by other persons
claiming through Tenant. Tenant shall, and hereby agrees to, indemnify, defend,
protect, and hold harmless the Landlord Parties from and against all
liabilities, damages, claims, losses, judgments, charges and expenses (including
reasonable attorneys' fees, costs of court and expenses necessary in the
prosecution or defense of any litigation including the enforcement of this
provision) arising from or in any way related to, directly or indirectly, (i)
the use of the Premises, Building, Complex and/or Real Property by Tenant or by
the contractors, agents, employees, licensees, invitees, subtenants, and assigns
of Tenant or any such person (collectively, the "Tenant's Representatives"),
(ii) the conduct of Tenant's business, (iii) from any activity, work or thing
done, permitted or suffered by Tenant in or about the Premises, (iv) in any way
connected with the Premises or with the installation, placement and removal of
Alterations, improvements, fixtures, personal property and/or equipment in, on
or about the Premises, including, but not limited to, any liability for injury
to person or property of Tenant, Tenant's Representatives, or third party
persons, and/or (v) Tenant's failure to perform any covenant or obligation of
Tenant under this Lease; provided, however, the terms of the foregoing indemnity
shall not apply to the gross negligence, willful misconduct, or breach of this
Lease of Landlord. The provisions of this Section 10.1 shall survive the
expiration or sooner termination of this Lease.

        
          
             

          

          
            9

            
              

            

          

          
             

          

        

        10.2
TENANT'S COMPLIANCE WITH LANDLORD'S FIRE AND CASUALTY INSURANCE. Tenant shall,
at Tenant's expense, comply as to the Premises with all insurance company
requirements pertaining to the use of the Premises. If Tenant's conduct or use
of the Premises causes any increase in the premium for such insurance policies,
then Tenant shall reimburse Landlord for any such increase. Tenant, at Tenant's
expense, shall comply with all rules, orders, regulations or requirements of the
American Insurance Association (formerly the National Board of Fire
Underwriters) and with any similar body relating specifically to Tenant's use or
occupancy.

         

        10.3
TENANT'S INSURANCE. Tenant shall maintain the following coverages in the
following amounts.

         

        10.3.1
Commercial General Liability Insurance covering the insured against claims of
bodily injury, personal injury and property damage arising out of Tenant's
operations, assumed liabilities or use of the Premises, including a Broad Form
Commercial General Liability endorsement covering the insuring provisions of
this Lease and the performance by Tenant of the indemnity agreements set forth
in Section 10.1 of this Lease, for limits of liability not less
than:

         

        
          	
                  Bodily Injury and
    Property

                	
                  $3,000,000
      each occurrence;

                
	
                  Damage
      Liability

                	
                  $3,000,000
      annual aggregate

                
	 
      	 
      
	
                  Personal
      Injury Liability

                	
                  $3,000,000
      each occurrence;

                
	 
      	
                  $3,000,000
      annual aggregate

                

        

        

        10.3.2
Physical Damage Insurance covering (i) all office furniture, trade fixtures,
office equipment, merchandise and all other items of Tenant's property on the
Premises installed by, for, or at the expense of Tenant, (ii) Tenant's
Alterations, including any Alterations which Landlord permits to be installed
above the ceiling of the Premises or below the floor of the Premises, and (iii)
all other improvements, alterations and additions to the Premises, including any
improvements, alterations or additions installed at Tenant's request above the
ceiling of the Premises or below the floor of the Premises. Such insurance shall
be written on an "all risk" or "special form" of physical loss or damage basis,
for the full replacement cost value new without deduction for depreciation of
the covered items and in amounts that meet any co-insurance clauses of the
policies of insurance and shall include a vandalism and malicious mischief
endorsement, sprinkler leakage coverage and earthquake sprinkler leakage
coverage.

        10.3.3
FORM OF POLICIES. The minimum limits of policies of insurance required of Tenant
under this Lease shall in no event limit the liability of Tenant under this
Lease. Such insurance shall (i) name Landlord, and any other party it so
specifies, as an additional insured; (ii) specifically cover the liability
assumed by Tenant under this Lease, including, but not limited to, Tenant's
obligations under Section 10.1 of this Lease; (iii) be issued by an insurance
company having a rating of not less than A-:X in A.M. Best's Rating Guide or
which is otherwise acceptable to Landlord, licensed to do business in the state
in which the Building is located, and domiciled in the United States; (iv) be
primary insurance as to all claims thereunder and provide that any insurance
carried by Landlord is excess and is non-contributing with any insurance
required of Tenant; (v) provide that said insurance shall not be canceled or
coverage changed unless thirty (30) days' prior written notice shall have been
given to Landlord and any mortgagee or ground or underlying lessor of Landlord;
and (vi) contain a cross-liability endorsement or severability of interest
clause acceptable to Landlord. Tenant shall deliver said policy or policies or
certificates thereof to Landlord on or before the Lease Commencement Date and at
least thirty (30) days before the expiration dates thereof. If Tenant shall fail
to procure such insurance, or to deliver such policies or certificate, within
such time periods, Landlord may, at its option, in addition to all of its other
rights and remedies under this Lease, and without regard to any notice and cure
periods set forth in Section 19.1, procure such policies for the account of
Tenant, and the cost thereof shall be paid to Landlord as Additional Rent within
ten (10) days after delivery of bills therefor.

         

        10.4
SUBROGATION. Landlord and Tenant agree to have their respective insurance
companies issuing property damage insurance waive any rights of subrogation that
such companies may have against Landlord or Tenant, as the case may be, so long
as the insurance carried by Landlord and Tenant, respectively, is not
invalidated thereby. As long as such waivers of subrogation are contained in
their respective insurance policies, Landlord and Tenant hereby waive any right
that either may have against the other on account of any loss or damage to their
respective property to the extent such loss or damage is insured under policies
of insurance for fire and all risk coverage, theft, public liability, or other
similar insurance.

         

        10.5
ADDITIONAL INSURANCE OBLIGATIONS. Tenant shall carry and maintain during the
entire Lease Term, at Tenant's sole cost and expense, increased amounts of the
insurance required to be carried by Tenant pursuant to this Article 10, and such
other reasonable types of insurance coverage and in such reasonable amounts
covering the Premises and Tenant's operations therein, as may be reasonably
requested by Landlord from time to time.

        ARTICLE
11 - DAMAGE AND DESTRUCTION

         

        11.1
REPAIR OF DAMAGE TO PREMISES BY LANDLORD. Tenant shall promptly notify Landlord
of any damage to the Premises resulting from fire or any other casualty. If the
Premises or any Common Areas of the Building serving or providing access to the
Premises shall be damaged by fire or other casualty, Landlord shall promptly and
diligently, subject to reasonable delays for insurance adjustment or other
matters beyond Landlord's reasonable control, and subject to all other
provisions of this Article 11, restore the Base, Shell, and Core of the Premises
and such Common Areas. Such restoration shall be to substantially the same
condition of the Base, Shell, and Core of the Premises and Common Areas prior to
the casualty, except for modifications required by zoning and building codes and
other laws or by the holder of a mortgage on the Building, or the lessor of a
ground or underlying lease with respect to the Real Property, the Complex and/or
the Building, or any other modifications to the Common Areas deemed desirable by
Landlord, provided access to the Premises and any common restrooms serving the
Premises shall not be materially impaired. Notwithstanding any other provision
of this Lease, upon the occurrence of any damage to the Premises, Tenant shall
assign to Landlord (or to any party designated by Landlord) all insurance
proceeds payable to Tenant under Tenant's insurance required under Section 10.3
of this Lease, and Landlord shall repair any injury or damage to the alterations
installed in the Premises (to the extent of insurance proceeds therefor actually
collected by Landlord) and shall return such alterations to their original
condition; provided that if the cost of such repair by Landlord exceeds the
amount of insurance proceeds received by Landlord from Tenant's insurance
carrier, as assigned by Tenant, the cost of such repairs shall be paid by Tenant
to Landlord prior to Landlord's repair of the damage. In connection with such
repairs and replacements, Tenant shall, prior to the commencement of
construction, submit to Landlord, for Landlord's review and approval, all plans,
specifications and working drawings relating thereto, and Landlord shall select
the contractors to perform such improvement work. Landlord shall not be liable
for any inconvenience or annoyance to Tenant or its visitors, or injury to
Tenant's business resulting in any way from such damage or the repair thereof;
provided, however, if such fire or other casualty shall have damaged the
Premises or Common Areas necessary to Tenant's occupancy, and if such damage is
not the result of the negligence (active or passive) or willful misconduct of
Tenant or any of Tenant's Representatives, Landlord shall allow Tenant a
proportionate abatement of Base Rent and Tenant's Share of Direct Expenses to
the extent Landlord is reimbursed from the proceeds of rental interruption
insurance purchased by Landlord as part of Operating Expenses, during the time
and to the extent the Premises are unfit for occupancy for the purposes
permitted under this Lease, and not occupied by Tenant as a result
thereof.

         

        
          
             

          

          
            10

            
              

            

          

          
             

          

        

         

        11.2
LANDLORD'S OPTION TO REPAIR. Notwithstanding the provisions of Section
11.1 of this Lease, Landlord may elect not to rebuild and/or restore the
Premises and/or Building and instead terminate this Lease by notifying Tenant in
writing of such termination within ninety (90) days after the date of damage,
such notice to include a termination date giving Tenant ninety (90) days to
vacate the Premises, but Landlord may so elect only if the Building shall be
damaged by fire or other casualty or cause, whether or not the Premises are
affected, and one or more of the following conditions is present: (i) repairs
cannot reasonably be completed within one hundred eighty (180) days of the date
of damage (when such repairs are made without the payment of overtime or other
premiums); (ii) the holder of any mortgage on the Building or ground or
underlying lessor with respect to the Real Property, the Complex and/or the
Building shall require that the insurance proceeds or any portion thereof be
used to retire the mortgage debt, or shall terminate the ground or underlying
lease, as the case may be; or (iii) the damage is not fully covered, except for
deductible amounts, by Landlord's insurance policies. In addition, if the
Premises or the Building is destroyed or damaged to any substantial extent
during the last twelve (12) months of the Lease Term, then notwithstanding
anything contained in this Article 11, Landlord shall have the option to
terminate this Lease by giving written notice to Tenant of the exercise of such
option within ninety (90) days after such damage or destruction, in which event
this Lease shall cease and terminate as of the date of such notice.
Notwithstanding anything to the contrary contained herein: (i) if Tenant's use
of the Premises is substantially impaired for a period of more than one hundred
eighty (180) days after the date of a casualty, or during the last six (6)
months of the Term, then Tenant shall have the right to terminate this Lease by
written notice to Landlord at any time thereafter up until the completion of the
restoration, and (ii) if this Lease is terminated by either Landlord or Tenant
due to a casualty, then Tenant shall not be required to pay for any insurance
deductibles as part of Landlord's insurance cost or otherwise. Upon any such
termination of this Lease pursuant to this Section 11.2, Tenant shall pay the
Base Rent and Additional Rent, properly apportioned up to such date of
termination, and both parties hereto shall thereafter be freed and discharged of
all further obligations hereunder, except as provided for in the provisions of
this Lease which by their terms survive the expiration or earlier termination of
the Lease Term.

        11.3
WAIVER OF STATUTORY PROVISIONS. The provisions of this Lease, including this
Article 11, constitute an express agreement between Landlord and Tenant with
respect to any and all damage to, or destruction of, all or any part of the
Premises, the Building, the Complex or any other portion of the Real Property,
and any statute or regulation of the state in which the Building is located,
including, without limitation, Sections 1932(2) and 1933(4) of the California
Civil Code (or under any similar law, statute, or ordinance now or hereafter in
effect), with respect to any rights or obligations concerning damage or
destruction in the absence of an express agreement between the parties, and any
other statute or regulation, now or hereafter in effect, shall have no
application to this Lease or any damage or destruction to all or any part of the
Premises, the Building, the Complex or any other portion of the Real
Property.

         

        ARTICLE
12 - CONDEMNATION

         

        12.1
PERMANENT TAKING. If the whole or any part of the Premises or Building shall be
taken by power of eminent domain or condemned by any competent authority for any
public or quasi-public use or purpose, or if any adjacent property or street
shall be so taken or condemned, or reconfigured or vacated by such authority in
such manner as to require the use, reconstruction or remodeling of any part of
the Premises or Building, or if Landlord shall grant a deed or other instrument
in lieu of such taking by eminent domain or condemnation, Landlord shall have
the option to terminate this Lease upon ninety (90) days' notice, provided such
notice is given no later than one hundred eighty (180) days after the date of
such taking, condemnation, reconfiguration, vacation, deed or other instrument.
If more than twenty-five percent (25%) of the rentable square feet of the
Premises is taken, or if access to the Premises is substantially impaired,
Tenant shall have the option to terminate this Lease upon ninety (90) days'
notice, provided such notice is given no later than one hundred eighty (180)
days after the date of such taking. Landlord shall be entitled to receive the
entire award or payment in connection therewith, except that Tenant shall have
the right to file any separate claim available to Tenant for any taking of
Tenant's personal property and fixtures belonging to Tenant and removable by
Tenant upon expiration of the Lease Term pursuant to the terms of this Lease,
and for moving expenses or loss of business by reason of such condemnation so
long as such claim does not diminish the award available to Landlord, its ground
lessor with respect to the Real Property or its mortgagee, and such claim is
payable separately to Tenant. All Rent shall be apportioned as of the date of
such termination, or the date of such taking, whichever shall first occur. If
any part of the Premises shall be taken, and this Lease shall not be so
terminated, the Rent shall be proportionately abated. If neither party elects to
terminate this Lease, Landlord shall, if necessary, promptly proceed to restore
the Premises or the Building to substantially its same condition prior to such
partial condemnation, allowing for the reasonable effects of such condemnation,
and a proportionate allowance shall be made to Tenant, as solely determined by
Landlord, for the Rent corresponding to the time during which, and to the part
of the Premises of which, Tenant is deprived on account of such partial
condemnation and restoration. Landlord shall not be required to spend funds for
restoration in excess of the amount received by Landlord as compensation
awarded. Tenant hereby waives any and all rights it might otherwise have
pursuant to Section 1265.130 of the California Code of Civil Procedure (or under
any similar law, statute, or ordinance now or hereafter in
effect).

        
          
             

          

          
            11

            
              

            

          

          
             

          

        

        12.2
TEMPORARY TAKING. Notwithstanding anything to the contrary contained in this
Article 12, in the event of a temporary taking of all or any portion of the
Premises for a period of one hundred and eighty (180) days or less, then this
Lease shall not terminate but the Base Rent and the Additional Rent shall be
abated for the period of such taking in proportion to the ratio that the amount
of rentable square feet of the Premises taken bears to the total rentable square
feet of the Premises. Landlord shall be entitled to receive the entire award
made in connection with any such temporary taking.

        

        ARTICLE
13 - COVENANT OF QUIET ENJOYMENT

         

        Landlord
covenants that Tenant, on paying the Rent, charges for services and other
payments herein reserved and on keeping, observing and performing all the other
terms, covenants, conditions, provisions and agreements herein contained on the
part of Tenant to be kept, observed and performed, shall, during the Lease Term,
peaceably and quietly have, hold and enjoy the Premises subject to the terms,
covenants, conditions, provisions and agreements hereof without interference by
Landlord or any successor or assign of Landlord. The foregoing covenant is in
lieu of any other covenant express or implied.

         

         

        ARTICLE
14 - ASSIGNMENT AND SUBLETTING

         

        14.1
TRANSFERS. Tenant shall not, without the prior written consent of Landlord,
assign, mortgage, pledge, hypothecate, encumber, or permit any lien to attach
to, or otherwise transfer, this Lease or any interest hereunder, permit any
assignment or other such foregoing transfer of this Lease or any interest
hereunder by operation of law, sublet the Premises or any part thereof, or
permit the use of the Premises by any persons other than Tenant and its
employees (all of the foregoing are hereinafter sometimes referred to
collectively as "Transfers" and any person to whom any Transfer is made or
sought to be made is hereinafter sometimes referred to as a "Transferee"). If
Tenant shall desire Landlord's consent to any Transfer, Tenant shall notify
Landlord in writing, which notice (the "Transfer Notice") shall include (i) the
proposed effective date of the Transfer, which shall not be less than thirty
(30) days nor more than one hundred eighty (180) days after the date of delivery
of the Transfer Notice, (ii) a description of the portion of the Premises to be
transferred (the "Subject Space"), (iii) all of the terms of the proposed
Transfer, the name and address of the proposed Transferee, and a copy of all
existing and/or proposed documentation pertaining to the proposed Transfer,
including all existing operative documents to be executed to evidence such
Transfer or the agreements incidental or related to such Transfer, (iv) current
financial statements of the proposed Transferee certified by an officer, member,
partner or owner thereof, and (v) such other information as Landlord may
reasonably require. Any Transfer made without Landlord's prior written consent
shall, at Landlord's option, be null, void and of no effect, and if not cured
within ten (10) days following notice, shall, at Landlord's option, constitute a
default by Tenant under this Lease. Whether or not Landlord shall grant consent,
Tenant shall pay, as additional rent hereunder, a fee in the amount of Five
Hundred Dollars ($500.00) plus Landlord's reasonable legal fees incurred by
Landlord, within thirty (30) days after written request by
Landlord.

        14.2
LANDLORD'S CONSENT. Landlord shall not unreasonably withhold its consent to any
proposed Transfer of the Subject Space to the Transferee on the terms specified
in the Transfer Notice. The parties hereby agree that it shall be reasonable
under this Lease and under any applicable law for Landlord to withhold consent
to any proposed Transfer where one or more of the following apply, without
limitation as to other reasonable grounds for withholding consent:

         

        14.2.1
The Transferee is of a character or reputation or engaged in a business which is
not consistent with the quality of the Building;

         

        14.2.2
The Transferee intends to use the Subject Space for purposes which are not
permitted under this Lease;

         

        14.2.3
The Transferee is either a governmental agency or instrumentality
thereof;

         

        14.2.4
The Transfer will result in more than a reasonable and safe number of occupants
per floor within the Subject Space;

         

        14.2.5
The Transferee is not a party of reasonable financial worth and/or financial
stability in light of the responsibilities involved under the Transfer on the
date consent is requested;

         

        14.2.6
The proposed Transfer would cause Landlord to be in violation of another lease
or agreement to which Landlord is a party, or would give an occupant of the
Building a right to cancel its lease;

         

        14.2.7
The terms of the proposed Transfer will allow the Transferee to exercise a right
of renewal, right of expansion, right of first offer, or other similar right
held by Tenant;

         

        14.2.8
Either the proposed Transferee, or any person or entity which directly or
indirectly, controls, is controlled by, or is under common control with, the
proposed Transferee, (i) occupies space in the Building at the time of the
request for consent, (ii) is negotiating with Landlord to lease space in the
Building at such time, or (iii) has negotiated with Landlord during the twelve
(12)-month period immediately preceding the Transfer Notice; or

         

        14.2.9
The Transfer occurs during the period from the Lease Commencement Date until the
date of at least ninety-five percent (95%) of the rentable square feet of the
Building is leased, and the rent charged by Tenant to such Transferee during the
term of such Transfer, calculated using a present value analysis, is less than
ninety-five percent (95%) of the rent being quoted by Landlord, at the time of
such Transfer, for comparable space in the Building for a comparable term,
calculated using a present value system.

        
          
             

          

          
            12

            
              

            

          

          
             

          

        

        If
Landlord consents to any Transfer pursuant to the terms of this Section 14.2
(and does not exercise any recapture rights Landlord may have under Section 14.4
of this Lease), Tenant may within three (3) months after Landlord's consent, but
not later than the expiration of said three-month period, enter into such
Transfer of the Premises or portion thereof, upon substantially the same terms
and conditions as are set forth in the Transfer Notice furnished by Tenant to
Landlord pursuant to Section 14.1 of this Lease, provided that if there are any
changes in the terms and conditions from those specified in the Transfer Notice
(i) such that Landlord would initially have been entitled to refuse its consent
to such Transfer under this Section 14.2, or (ii) which would cause the proposed
Transfer to be more favorable to the Transferee than the terms set forth in
Tenant's original Transfer Notice, Tenant shall again submit the Transfer to
Landlord for its approval and other action under this Article 14 (including
Landlord's right of recapture, if any, under Section 14.4 of this
Lease).

         

        14.3
TRANSFER PREMIUM. If Landlord consents to a Transfer, as a condition thereto
which the parties hereby agree is reasonable, Tenant shall pay to Landlord any
"Transfer Premium," as that term is defined in this Section 14.3, received by
Tenant from such Transferee. "Transfer Premium" shall mean seventy-five percent
(75%) of all rent, additional rent or other consideration payable by such
Transferee in excess of the Rent and Additional Rent payable by Tenant under
this Lease on a per rentable square foot basis if less than all of the Premises
is transferred, after deducting the reasonable expenses incurred by Tenant in
connection with the Transfer (the "Subleasing Costs"). "Transfer Premium" shall
also include, but not be limited to, key money and bonus money paid by
Transferee to Tenant in connection with such Transfer, and any payment in excess
of fair market value for services rendered by Tenant to Transferee or for
assets, fixtures, inventory, equipment, or furniture transferred by Tenant to
Transferee in connection with such Transfer.

         

        14.4
LANDLORD'S OPTION AS TO SUBJECT SPACE. Notwithstanding anything to the contrary
contained in this Article 14, if the Subject Space shall comprise all or
substantially all of a full floor of the Premises, or more, and if the proposed
Transfer would commence at any time on or after November 1, 2003, Landlord shall
have the option, by giving written notice to Tenant within thirty

         

        (30) days
after receipt of any Transfer Notice, to recapture the Subject Space. Such
recapture notice shall cancel and terminate this Lease with respect to the
Subject Space as of the date stated in the Transfer Notice as the effective date
of the proposed Transfer. If this Lease shall be canceled with respect to less
than the entire Premises, the Rent reserved herein shall be prorated on the
basis of the number of rentable square feet retained by Tenant in proportion to
the number of rentable square feet contained in the Premises, and this Lease as
so amended shall continue thereafter in full force and effect, and upon request
of either party, the parties shall execute written confirmation of the same. If
Landlord declines, or fails to elect in a timely manner to recapture the Subject
Space under this Section 14.4, then, provided Landlord has consented to the
proposed Transfer, Tenant shall be entitled to proceed to transfer the Subject
Space to the proposed Transferee, subject to the provisions of the last
paragraph of Section 14.2 of this Lease.

        14.5
EFFECT OF TRANSFER. If Landlord consents to a Transfer, (i) the terms and
conditions of this Lease shall in no way be deemed to have been waived or
modified, (ii) such consent shall not be deemed consent to any further Transfer
by either Tenant or a Transferee, (iii) Tenant shall deliver to Landlord,
promptly after execution, an original executed copy of all documentation
pertaining to the Transfer in form reasonably acceptable to Landlord, and (iv)
no Transfer relating to this Lease or agreement entered into with respect
thereto, whether with or without Landlord's consent, shall relieve Tenant or any
guarantor of the Lease from liability under this Lease. Landlord or its
authorized representatives shall have the right at all reasonable times to audit
the books, records and papers of Tenant relating to any Transfer, and shall have
the right to make copies thereof. If the Transfer Premium respecting any
Transfer shall be found understated, Tenant shall, within thirty (30) days after
demand, pay the deficiency and Landlord's costs of such audit. No assignment or
subletting shall affect the continuing primary liability of Tenant (which,
following assignment, shall be joint and several with the assignee), and Tenant
shall not be released from performing any of the terms, covenants and conditions
of this Lease. Any and all options, first rights of refusal, tenant improvement
allowances and other similar rights granted to Tenant in this Lease, if any,
shall only be assignable by Tenant as part of this Lease.

         

        14.6
ADDITIONAL TRANSFERS. For purposes of this Lease, the term "Transfer" shall also
include (i) if Tenant is a partnership or limited liability company, the
withdrawal or change, voluntary, involuntary or by operation of law, of fifty
percent (50%) or more of the partners or members, or transfer of twenty-five
percent (25%) or more of partnership or members interests, within a twelve
(12)-month period, or the dissolution of the partnership or limited liability
company without immediate reconstitution thereof, and (ii) if Tenant is a
closely held corporation (i.e., whose stock is not publicly held and not traded
through an exchange or over the counter), (A) the dissolution, merger,
consolidation or other reorganization of Tenant, (B) the sale or other transfer
of more than an aggregate of fifty percent (50%) of the voting shares of Tenant
(other than to immediate family members by reason of gift or death), within a
twelve (12)-month period, or (C) the sale, mortgage, hypothecation or pledge of
more than an aggregate of fifty percent (50%) of the value of the unencumbered
assets of Tenant within a twelve (12) month period.

         

        14.7
PERMITTED TRANSFERS. Notwithstanding anything to the contrary contained in this
Lease, Tenant may assign this Lease or sublet the Premises, or any portion
thereof, without Landlord's consent, to any entity which controls, is controlled
by, or is under common control with Tenant; to any entity which results from a
merger of, reorganization of, or consolidation with Tenant; to any entity
engaged in a joint venture with Tenant; or to any entity which acquires
substantially all of the stock or assets of Tenant, as a going concern, with
respect to the business that is being conducted in the Premises (hereinafter
each a "Permitted Transfer"). In addition, a sale or transfer of the capital
stock of Tenant shall be deemed a Permitted Transfer if (1) such sale or
transfer occurs in connection with any bona fide financing or capitalization for
the benefit of Tenant, or (2) Tenant is or becomes a publicly traded
corporation. Landlord shall have no right to terminate the Lease in connection
with, and shall have no right to any sums or other economic consideration
resulting from any Permitted Transfer. Additionally, any rights that are
personal to Tenant shall also accrue to any Permitted Transferee.

         

        ARTICLE
15 - SURRENDER; OWNERSHIP AND REMOVAL OF TRADE FIXTURES

         

        15.1
SURRENDER OF PREMISES. No act or thing done by Landlord or any agent or employee
of Landlord during the Lease Term shall be deemed to constitute an acceptance by
Landlord of a surrender of the Premises unless such intent is specifically
acknowledged in a writing signed by Landlord. The delivery of keys to the
Premises to Landlord or any agent or employee of Landlord shall not constitute a
surrender of the Premises or effect a termination of this Lease, whether or not
the keys are thereafter retained by Landlord, and notwithstanding such delivery
Tenant shall be entitled to the return of such keys at any reasonable time upon
request until this Lease shall have been properly terminated. The voluntary or
other surrender of this Lease by Tenant, whether accepted by Landlord or not, or
a mutual termination hereof, shall not work a merger, and at the option of
Landlord shall operate as an assignment to Landlord of all subleases or
subtenancies affecting the Premises.

         

        
          
             

          

          
            13

            
              

            

          

          
             

          

        

         

        15.2
REMOVAL OF TENANT PROPERTY BY TENANT. Upon the expiration of the Lease Term, or
upon any earlier termination of this Lease, Tenant shall, subject to the
provisions of this Article 15, quit and surrender possession of the Premises to
Landlord in as good order and condition as when Tenant took possession and as
thereafter improved by Landlord and/or Tenant, reasonable wear and tear and
repairs which are specifically made the responsibility of Landlord hereunder
excepted. Upon such expiration or termination, Tenant shall, without expense to
Landlord, remove or cause to be removed from the Premises all debris and
rubbish, and such items of furniture, equipment, free-standing cabinet work, and
other articles of personal property owned by Tenant or installed or placed by
Tenant at its expense in the Premises, and such similar articles of any other
persons claiming under Tenant, as Landlord may, in its sole discretion, require
to be removed, and Tenant shall repair at its own expense all damage to the
Premises and Building resulting from such removal.

         

        ARTICLE
16 - HOLDING OVER

         

        If Tenant
holds over after the expiration of the Lease Term hereof, with or without the
express or implied consent of Landlord, such tenancy shall be from
month-to-month only, and shall not constitute a renewal hereof or an extension
for any further term, and in such case Base Rent shall be payable at a monthly
rate equal to (a) one hundred twenty-five percent (125%) for the first two full
months of any such holding over, and after that (b) two hundred percent (200%),
in each case of the (i) the greater of Base Rent applicable during the last
rental period of the Lease Term under this Lease (ii) the fair market rental
rate of the Premises as of the commencement of such holdover period. Such
month-to-month tenancy shall be subject to every other term, covenant and
agreement contained herein. Landlord hereby expressly reserves the right to
require Tenant to surrender possession of the Premises to Landlord as provided
in this Lease upon the expiration or other termination of this Lease. The
provisions of this Article 16 shall not be deemed to limit or constitute a
waiver of any other rights or remedies of Landlord provided herein or at law. If
Tenant fails to surrender the Premises upon the termination or expiration of
this Lease, in addition to any other liabilities to Landlord accruing therefrom,
Tenant shall protect, defend, indemnify and hold Landlord harmless from all
loss, costs (including reasonable attorneys' fees) and liability resulting from
such failure, including, without limiting the generality of the foregoing, any
claims made by any succeeding tenant founded upon such failure to surrender, and
any lost profits to Landlord resulting therefrom.

        ARTICLE
17 - ESTOPPEL CERTIFICATES

         

        Within
ten (10) days following a request in writing by Landlord, Tenant shall execute
and deliver to Landlord an estoppel certificate, which, as submitted by
Landlord, shall be substantially in the form of Exhibit E, attached hereto (or
such other form as may be required by any prospective mortgagee or purchaser of
the Building, Complex or Real Property, or any portion thereof), indicating
therein any exceptions thereto that may exist at that time, and shall also
contain any other information reasonably requested by Landlord, Landlord's
mortgagee or prospective mortgagee, or a prospective purchaser. Tenant shall
execute and deliver whatever other instruments may be reasonably required for
such purposes. Failure of Tenant to timely execute and deliver such estoppel
certificate or other instruments shall constitute an acceptance of the Premises
and an acknowledgment by Tenant that statements included in the estoppel
certificate are true and correct, without exception.

         

        ARTICLE
18 - SUBORDINATION

         

        This
Lease is subject and subordinate to all present and future ground or underlying
leases of the Real Property and to the lien of any mortgages or trust deeds, now
or hereafter in force against the Real Property, the Complex and the Building,
if any, and to all renewals, extensions, modifications, consolidations and
replacements thereof, and to all advances made or hereafter to be made upon the
security of such mortgages or trust deeds, unless the holders of such mortgages
or trust deeds, or the lessors under such ground lease or underlying leases,
require in writing that this Lease be superior thereto. Tenant covenants and
agrees in the event any proceedings are brought for the foreclosure of any such
mortgage, or if any ground or underlying lease is terminated, to attorn, without
any deductions or set-offs whatsoever, to the purchaser upon any such
foreclosure sale, or to the lessor of such ground or underlying lease, as the
case may be, if so requested to do so by such purchaser or lessor, and to
recognize such purchaser or lessor as the lessor under this Lease. Tenant shall,
within five (5) days of request by Landlord, execute such further instruments or
assurances as Landlord may reasonably deem necessary to evidence or confirm the
subordination or superiority of this Lease to any such mortgages, trust deeds,
ground leases or underlying leases; provided, such mortgagee, ground lessor or
similar parties agree therein not to disturb Tenant's use, occupancy or quiet
enjoyment of the Premises so long as Tenant is not in default (beyond applicable
notice and cure periods, if any) of the terms and provisions of this Lease.
Tenant hereby irrevocably authorizes Landlord to execute and deliver in the name
of Tenant any such instrument or instruments if Tenant fails to do so, provided
that such authorization shall in no way relieve Tenant from the obligation of
executing such instruments of subordination or superiority. Tenant waives the
provisions of any current or future statute, rule or law which may give or
purport to give Tenant any right or election to terminate or otherwise adversely
affect this Lease and the obligations of the Tenant hereunder in the event of
any foreclosure proceeding or sale.

         

        ARTICLE
19 - TENANT'S DEFAULTS; LANDLORD'S REMEDIES

         

        19.1
EVENTS OF DEFAULT BY TENANT. All covenants and agreements to be kept or
performed by Tenant under this Lease shall be performed by Tenant at Tenant's
sole cost and expense and without any reduction of Rent. The occurrence of any
of the following shall constitute a material default of this Lease by
Tenant:

         

        
          
             

          

          
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        19.1.1
Any failure by Tenant to pay any Rent or any other charge required to be paid
under this Lease, or any part thereof, provided, however, that for only the
first two instances in any 12-month period, any such failure shall not be a
default until such failure shall have continued for a period in excess of two
(2) business days; or

         

        19.1.2
Any failure by Tenant to observe or perform any other provision, covenant or
condition of this Lease to be observed or performed by Tenant where such failure
continues for fifteen (15) days after written notice thereof from Landlord to
Tenant; provided however, that any such notice shall be in lieu of, and not in
addition to, any notice required under California Code of Civil Procedure
Section 1161 or any similar or successor law; and provided further that if the
nature of such default is such that the same cannot reasonably be cured within a
fifteen (15)-day period, Tenant shall not be deemed to be in default if it
diligently commences such cure within such period and thereafter diligently
proceeds to rectify and completely cure said default as soon as possible but in
all events within ninety (90) days of Landlord's delivery to Tenant of written
notice of such default; or

         

        19.1.3
Abandonment of the Premises by Tenant. Abandonment is herein defined to include,
but is not limited to, any absence by Tenant from the Premises for five (5)
business days or longer while in default of any provision of this Lease;
or

         

        19.1.4
The making of a general assignment by Tenant for the benefit of creditors, the
filing of a voluntary petition by Tenant or the filing of an involuntary
petition by any of Tenant's creditors seeking the rehabilitation, liquidation,
or reorganization of Tenant under any law relating to bankruptcy, insolvency or
other relief of debtors and, in the case of an involuntary action, the failure
to remove or discharge the same within sixty

         

        (60) days
of such filing, the appointment of a receiver or other custodian to take
possession of substantially all of Tenant's assets or this leasehold, Tenant's
insolvency or inability to pay Tenant's debts or failure generally to pay
Tenant's debts when due, any court entering a decree or order directing the
winding up or liquidation of Tenant or of substantially all of Tenant's assets,
Tenant taking any action toward the dissolution or winding up of Tenant's
affairs, the cessation or suspension of Tenant's use of the Premises, or the
attachment, execution or other judicial seizure of substantially all of Tenant's
assets or this leasehold; or

         

        19.1.5
The making of any material misrepresentation or omission by Tenant in any
materials delivered by or on behalf of Tenant to Landlord pursuant to this
Lease.

         

        19.2
Landlord's Remedies Upon Default. Upon the occurrence of any such default by
Tenant, Landlord shall have, in addition to any other remedies available to
Landlord at law or in equity, the option to pursue any one or more of the
following remedies, each and all of which shall be cumulative and nonexclusive,
without any notice or demand whatsoever.

        19.2.1
Terminate this Lease, in which event Tenant shall immediately surrender the
Premises to Landlord, and if Tenant fails to do so, Landlord may, without
prejudice to any other remedy which it may have for possession or arrearages in
rent, enter upon and take possession of the Premises and expel or remove Tenant
and any other person who may be occupying the Premises or any part thereof,
without being liable for prosecution or any claim or damages therefor; and
Landlord may recover from Tenant the following:

         

        (i) The
worth at the time of award of any unpaid rent which has been earned at the time
of such termination; plus

         

        (ii) The
worth at the time of award of the amount by which the unpaid rent which would
have been earned after termination until the time of award exceeds the amount of
such rental loss that Tenant proves could have been reasonably avoided;
plus

         

        (iii) The
worth at the time of award of the amount by which the unpaid rent for the
balance of the Lease Term after the time of award exceeds the amount of such
rental loss that Tenant proves could have been reasonably avoided;
plus

         

        (iv) Any
other amount necessary to compensate Landlord for all the detriment proximately
caused by Tenant's failure to perform its obligations under this Lease or which
in the ordinary course of things would be likely to result therefrom,
specifically including but not limited to, brokerage commissions and advertising
expenses incurred, expenses of remodeling the Premises or any portion thereof
for a new tenant, whether for the same or a different use, and any special
concessions made to obtain a new tenant; and

         

        (v) At
Landlord's election, such other amounts in addition to or in lieu of the
foregoing as may be permitted from time to time by applicable law.

         

        The term
"rent" as used in this Section 19.2 shall be deemed to be and to mean all sums
of every nature required to be paid by Tenant pursuant to the terms of this
Lease, whether to Landlord or to others. As used in Paragraphs 19.2.1(i) and
(ii), above, the "worth at the time of award" shall be computed by allowing
interest at the Interest Rate set forth in Section 4.6 of this Lease. As used in
Paragraph 19.2.1(iii) above, the "worth at the time of award" shall be computed
by discounting such amount at the discount rate of the Federal Reserve Bank of
San Francisco at the time of award plus one percent (1%).

         

        19.2.2
Landlord shall have the remedy described in California Civil Code Section 1951.4
(lessor may continue lease in effect after lessee's breach and abandonment and
recover rent as it becomes due, if lessee has the right to sublet or assign,
subject only to reasonable limitations). Accordingly, if Landlord does not elect
to terminate this Lease on account of any default by Tenant, Landlord may, from
time to time, without terminating this Lease, enforce all of its rights and
remedies under this Lease, including the right to recover all rent as it becomes
due.

        19.2.3
Landlord may, but shall not be obligated to, make any such payment or perform or
otherwise cure any such obligation, provision, covenant or condition on Tenant's
part to be observed or performed (and may enter the Premises for such purposes).
In the event of Tenant's failure to perform any of its obligations or covenants
under this Lease, and such failure to perform poses a material risk of injury or
harm to persons or damage to or loss of property, then Landlord shall have the
right to cure or otherwise perform such covenant or obligation at any time after
such failure to perform by Tenant, whether or not any such notice or cure period
set forth in Section 19.1 above has expired. Any such actions undertaken by
Landlord pursuant to the foregoing provisions of this Section 19.2.3 shall not
be deemed a waiver of Landlord's rights and remedies as a result of Tenant's
failure to perform and shall not release Tenant from any of its obligations
under this Lease. Tenant waives redemption or relief from forfeiture under
California Code of Civil Procedure Sections 1174 and 1179, or under any other
present or future law, in the event Tenant is evicted or Landlord takes
possession of the Premises by reason of any default of Tenant
hereunder.

         

        
          
             

          

          
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        19.3
PAYMENT BY TENANT. Tenant shall pay to Landlord, within fifteen

         

        (15) days
after delivery by Landlord to Tenant of statements therefor: (i) sums equal to
expenditures reasonably made and obligations incurred by Landlord in connection
with Landlord's performance or cure of any of Tenant's obligations pursuant to
the provisions of Section 19.2.3 above; and (ii) sums equal to all expenditures
made and obligations incurred by Landlord in collecting or attempting to collect
the Rent or in enforcing or attempting to enforce any rights of Landlord under
this Lease or pursuant to law, including, without limitation, all legal fees and
other amounts so expended. Tenant's obligations under this Section 19.3 shall
survive the expiration or sooner termination of the Lease Term.

         

        19.4
SUBLESSEES OF TENANT. Whether or not Landlord elects to terminate this Lease on
account of any default by Tenant, as set forth in this Article 19, Landlord
shall have the right to terminate any and all subleases, licenses, concessions
or other consensual arrangements for possession entered into by Tenant and
affecting the Premises or may, in Landlord's sole discretion, succeed to
Tenant's interest in such subleases, licenses, concessions or arrangements. In
the event of Landlord's election to succeed to Tenant's interest in any such
subleases, licenses, concessions or arrangements, Tenant shall, as of the date
of notice by Landlord of such election, have no further right to or interest in
the rent or other consideration receivable thereunder.

         

        19.5
WAIVER OF DEFAULT. No waiver by Landlord of any violation or breach by Tenant of
any of the terms, provisions and covenants herein contained shall be deemed or
construed to constitute a waiver of any other or later violation or breach by
Tenant of the same or any other of the terms, provisions, and covenants herein
contained. Forbearance by Landlord in enforcement of one or more of the remedies
herein provided upon a default by Tenant shall not be deemed or construed to
constitute a waiver of such default. The acceptance of any Rent hereunder by
Landlord following the occurrence of any default, whether or not known to
Landlord, shall not be deemed a waiver of any such default, except only a
default in the payment of the Rent so accepted.

         

        19.6
EFFORTS TO RELET. For the purposes of this Article 19, Tenant's right to
possession shall not be deemed to have been terminated by efforts of Landlord to
relet the Premises, by its acts of maintenance or preservation with respect to
the Premises, or by appointment of a receiver to protect Landlord's interests
hereunder. The foregoing enumeration is not exhaustive, but merely illustrative
of acts which may be performed by Landlord without terminating Tenant's right to
possession.

        ARTICLE
20 - SECURITY DEPOSIT AND LETTER OF CREDIT

         

        20.1
SECURITY DEPOSIT. Concurrent with Tenant's execution of this Lease, Tenant shall
deposit with Landlord a security deposit (the "Security Deposit") in the amount
set forth in Section 10 of the Summary. The Security Deposit shall be held by
Landlord as security for the faithful performance by Tenant of all the terms,
covenants, and conditions of this Lease to be kept and performed by Tenant
during the Lease Term. If Tenant defaults with respect to any provisions of this
Lease, including, but not limited to, the provisions relating to the payment of
Rent, Landlord may, but shall not be required to, use, apply or retain all or
any part of the Security Deposit for the payment of any Rent or any other sum in
default, or for the payment of any amount that Landlord may spend or become
obligated to spend by reason of Tenant's default, or to compensate Landlord for
any other loss or damage that Landlord may suffer by reason of Tenant's default.
If any portion of the Security Deposit is so used or applied, Tenant shall,
within five (5) days after written demand therefor, deposit cash with Landlord
in an amount sufficient to restore the Security Deposit to its original amount,
and Tenant's failure to do so shall be a default under this Lease. If Tenant
shall fully and faithfully perform every provision of this Lease to be performed
by it, the Security Deposit, or any balance thereof, shall be returned to
Tenant, or, at Landlord's option, to the last assignee of Tenant's interest
hereunder, as soon as practicable following the expiration of the Lease Term.
Landlord shall not be required to keep the Security Deposit separate from other
funds, and, unless otherwise required by law, Tenant shall not be entitled to
any interest on the Security Deposit. In no event or circumstance shall Tenant
have the right to any use of the Security Deposit and, specifically, Tenant may
not use the Security Deposit as a credit or to otherwise offset any payments
required hereunder, including, but not limited to, Rent or any portion
thereof.

         

        20.2
LETTER OF CREDIT. Simultaneously with Tenant's delivery to Landlord of this
Lease and the first month's Base Rent in accordance with the provisions of
Section 3 above, Tenant shall deliver to Landlord, as collateral for the full
and faithful performance by Tenant of all of its obligations under this Lease
and for all losses and damages Landlord may suffer as a result of any default by
Tenant under this Lease, an irrevocable and unconditional negotiable letter of
credit, in the form and containing the terms required herein, payable in the
City of Alameda, California running in favor of Landlord issued by a solvent
nationally recognized bank with a long term rating of BBB or higher, under the
supervision of the Superintendent of Banks of the State of California, or a
National Banking Association, in the amount of One Million Five Hundred Thousand
Dollars ($1,500,000.00) ("Initial Letter of Credit"). Upon the RP Commencement
Date, the face amount of the Letter of Credit shall be increased to be Two
Million Dollars ($2,000,000.00). The Letter of Credit shall be (a) at sight and
irrevocable and unconditional, (b) maintained in effect, whether through
replacement, renewal or extension, for the entire Lease Term (the "Letter of
Credit Expiration Date") and Tenant shall deliver a new Letter of Credit or
certificate of renewal or extension to Landlord at least thirty (30) days prior
to the expiration of the Letter of Credit, without any action whatsoever on the
part of Landlord, (c) subject to the International Standby Practices (1998-Rev)
International Chamber of Commerce Publication #590, (d) acceptable to Landlord
in its sole, but reasonable, discretion, and (e) fully assignable by Landlord
and permit partial draws. In addition to the foregoing, the form and terms of
the Letter of Credit (and the bank issuing the same) shall be acceptable to
Landlord, in Landlord's sole, but reasonable, discretion, and shall provide,
among other things, in effect that: (1) Landlord, or its then managing agent,
shall have the right to draw down an amount up to the face amount of the Letter
of Credit upon the presentation to the issuing bank of Landlord's (or Landlord's
then managing agent's) statement that such amount is due to Landlord under the
terms and conditions of this Lease, it being understood that if Landlord or its
managing agent be a limited liability company, corporation, partnership or other
entity, then such statement shall be signed by a managing member (if a limited
liability company) an officer (if a corporation), a general partner (if a
partnership), or any authorized party (if another entity); (2) the Letter of
Credit will be honored by the issuing bank without inquiry as to the accuracy
thereof and regardless of whether the Tenant disputes the content of such
statement; and (3) in the event of a transfer of Landlord's interest in the
Building, Landlord shall transfer the Letter of Credit, in whole or in part (or
cause a substitute letter of credit to be delivered, as applicable), to the
transferee and thereupon the Landlord shall, without any further agreement
between the parties, be released by Tenant from all liability therefor, and it
is agreed that the provisions hereof shall apply to every transfer or assignment
of the whole or any portion of said Letter of Credit to a new Landlord. Tenant
hereby acknowledges and agrees that Landlord is entering into this Lease in
material reliance upon the ability of Landlord to draw upon the Letter of Credit
upon the occurrence of any default on the part of Tenant hereunder which
continues beyond any applicable notice and cure periods. Tenant further
acknowledges and agrees that if Landlord cannot draw upon the Letter of Credit
within the times and in the manner as anticipated by Landlord herein, Landlord
shall suffer irreparable damage, harm and injury. From time to time during the
Term of this Lease it is anticipated by the parties that the Letter of Credit
will need to be amended, modified and, possibly reissued. Landlord and Tenant
hereby covenant and agree to cooperate with one another to promptly effectuate
any such amendments, modifications and new issuances, including without
limitation, executing and submitting to the Issuer any and all documents or
instruments as may be reasonably required to effectuate same. Each and every
time during the Term of this Lease there is a change in the identity or address
of the parties, including without limitation, any change in the identity of
Landlord due to the sale, transfer or other conveyance by Landlord of its rights
and interests in, to and under this Lease to any other party, person or entity,
the Letter of Credit shall immediately be amended or reissued to reflect such
changes and the parties hereby agree to execute and submit to the Issuer such
further applications, documents and instruments as may be necessary to
effectuate same. It is the intention of the parties that each and every
successor and assign of both Landlord and Tenant be bound by and subject to the
terms and provisions of this Section 20.2. Landlord may, at any time and without
notice to Tenant and without first obtaining Tenant's consent thereto, assign
all or any portion of its interest in and to the Letter of Credit to another
party, person or entity, regardless of whether or not such assignment is
separate from or as a part of the assignment by Landlord of its rights and
interests in and to this Lease. If, as a result of any such application of all
or any part of the Letter of Credit, the amount of the Letter of Credit shall be
less than One Million Five Hundred Thousand Dollars ($1,500,000.00) or Two
Million Dollars ($2,000,000.00), as applicable, Tenant shall within five (5)
days thereafter provide Landlord with additional letter(s) of credit in an
amount equal to the deficiency (or a replacement letter of credit in the total
amount of One Million Five Hundred Thousand Dollars ($1,500,000.00) or Two
Million Dollars ($2,000,000.00), as applicable, and each such additional (or
replacement) letter of credit shall comply with all of the provisions of
this

         

        
          
             

          

          
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        Section
20.2, and if Tenant fails to do so, notwithstanding anything to the contrary
contained in Article 19 hereof, the same shall constitute an incurable default
by Tenant. Tenant further covenants and warrants that it will neither assign nor
encumber the Letter of Credit or any part thereof and that neither Landlord nor
its successors or assigns will be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance. Without limiting the generality
of the foregoing, if the Letter of Credit expires earlier than the Letter of
Credit Expiration Date, Landlord will accept a renewal thereof or substitute
letter of credit (such renewal or substitute letter of credit to be in effect
not later than thirty (30) days prior to the expiration thereof), which shall be
irrevocable and automatically renewable as above provided through the Letter of
Credit Expiration Date upon the same terms as the expiring letter of credit or
such other terms as may be acceptable to Landlord in its sole, but reasonable,
discretion. However, if the Letter of Credit is not timely renewed or a
substitute letter of credit is not timely received, or if Tenant fails to
maintain the Letter of Credit in the amount and terms set forth in this Section
20.2, Landlord shall have the right to present such Letter of Credit to the bank
in accordance with the terms of this Section 20.2, and the entire sum evidenced
thereby shall be paid to and held by Landlord as collateral for performance of
all of Tenant's obligations under this Lease and for all losses and damages
Landlord may suffer as a result of any default by Tenant under this Lease. If
there shall occur a default under this Lease as set forth in Article 19 hereof,
Landlord may, but without obligation to do so, draw upon the Letter of Credit,
in part or in whole, in such amount as is reasonably necessary to cure any
default of Tenant and/or to compensate Landlord for any and all damages of any
kind or nature sustained or which may be sustained by Landlord resulting from
Tenant's default. Tenant agrees not to interfere in any way with payment to
Landlord of the proceeds of the Letter of Credit, either prior to or following a
"draw" by Landlord of any portion of the Letter of Credit, regardless of whether
any dispute exists between Tenant and Landlord as to Landlord's right to draw
from the Letter of Credit. No condition or term of this Lease shall be deemed to
render the Letter of Credit conditional to justify the issuer of the Letter of
Credit in failing to honor a drawing upon such Letter of Credit in a timely
manner. Landlord and Tenant acknowledge and agree that in no event or
circumstance shall the Letter of Credit or any renewal thereof or substitute
therefor be (i) deemed to be or treated as a "security deposit" within the
meaning of California Civil Code Section 1950.7 (as supplemented, amended,
replaced and substituted from time to time), (ii) subject to the terms of
such

         

        Section
1950.7 (as supplemented, amended, replaced and substituted from time to time),
or (iii) intended to serve as a "security deposit" within the meaning of such
Section 1950.7 (as supplemented, amended, replaced and substituted from time to
time). The parties hereto recite that with respect to the Letter of Credit, (x)
the Letter of Credit is not intended to serve as a security deposit and such
Section 1950.7 (as supplemented, amended, replaced and substituted from time to
time), and any and all other laws, rules and regulations applicable to security
deposits in the commercial context ("Security Deposit Laws") shall have no
applicability or relevancy to the Letter of Credit and (y) Tenant waives any and
all rights, duties and obligations it may now or, in the future, will have
relating to or arising from the Security Deposit Laws.

         

        Notwithstanding
the foregoing, if, after the first five (5) years of the Lease Term have
elapsed, Tenant is not in default in the terms of this Lease and Tenant has
completed four (4) consecutive quarters of positive "EBITDA" (earnings before
interest expense, income taxes, depreciation and amortization expense, as
certified to Landlord by Tenant's independent certified public accounting firm),
Tenant may then, and at six month intervals thereafter reduce the amount of the
Letter of Credit by equal amounts such that at the expiration of the Term, the
Letter of Credit would be reduced to zero. Notwithstanding the foregoing, if at
any time after the Letter of Credit has been reduced pursuant to the foregoing,
Tenant has two consecutive quarters in which EBITDA is negative, then the Letter
of Credit shall remain as is then in effect and shall not be further reduced
until such time as Tenant has four (4) consecutive quarters of positive EBITDA,
at which time the reductions shall resume in the semi-annual amounts previously
calculated. In the event that Tenant is entitled to have the Letter of Credit
reduced, Landlord shall cooperate with Tenant by exchanging with Tenant the
existing Letter of Credit for the new Letter of Credit in the reduced
amount.

        
          
             

          

          
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        ARTICLE
21 - COMPLIANCE WITH LAW

         

        Tenant
shall not do anything or suffer anything to be done in or about the Premises
which will in any way conflict with any law, statute, ordinance or other
governmental or quasi-governmental rule, regulation or requirement now in force
or which may hereafter be enacted or promulgated. At its sole cost and expense,
Tenant shall promptly comply with all such governmental measures, other than the
making of structural changes or changes to the Building's life safety system or
are required to correct violations of law that existed as of the Commencement
Date (collectively the "Excluded Changes") except to the extent such Excluded
Changes are required due to Tenant's alterations, improvements, modifications or
additions to or Tenant's specific manner of use of the Premises. In addition,
Tenant shall fully comply with all present or future programs intended to manage
parking, transportation or traffic in and around the Building, and in connection
therewith, Tenant shall take responsible action for the transportation planning
and management of all employees located at the Premises by working directly with
Landlord, any governmental transportation management organization or any other
transportation-related committees or entities. The judgment of any court of
competent jurisdiction or the admission of Tenant in any judicial action,
regardless of whether Landlord is a party thereto, that Tenant has violated any
of said governmental measures, shall be conclusive of that fact as between
Landlord and Tenant.

         

        ARTICLE
22 - ENTRY BY LANDLORD

         

        Landlord
reserves the right at all reasonable times and upon 24 hours' prior notice
(except in the case of emergency) to Tenant to enter the Premises to (i) inspect
them; (ii) show the Premises to prospective purchasers, mortgagees or tenants,
or to the ground or underlying lessors; (iii) to post notices of
non-responsibility; (iv) alter, improve or repair the Premises or the Building
if necessary to comply with current building codes or other applicable laws, any
recorded covenants, conditions and restrictions ("CC&Rs"), or for structural
alterations, repairs or improvements to the Building, or as Landlord may
otherwise reasonably desire or deem necessary; or (v) perform and take actions
necessary to comply with the requirements and/or restrictions set forth in any
CC&Rs. Notwithstanding anything to the contrary contained in this Article
22, Landlord may enter the Premises at any time, without notice to Tenant, to
perform janitorial or other services required of Landlord pursuant to this
Lease. Any such entries shall be subject to Tenant's reasonable security
requirements and shall be without the abatement of Rent and shall include the
right to take such reasonable steps as required to accomplish the stated
purposes, provided that Landlord shall use its best efforts to minimize any
disruption to the business being carried on in the Premises during any such
entry. Tenant hereby waives any claims for damages or for any injuries or
inconvenience to or interference with Tenant's business, lost profits, any loss
of occupancy or quiet enjoyment of the Premises, and any other loss occasioned
thereby, unless due to Landlord's gross negligence, willful misconduct or a
breach of this Lease. For each of the above purposes, Landlord shall at all
times have a key with which to unlock all the doors in the Premises, excluding
Tenant's vaults, safes and special security areas designated in advance by
Tenant. In an emergency, Landlord shall have the right to use any means that
Landlord may deem proper to open the doors in and to the Premises. Any entry
into the Premises in the manner hereinbefore described shall not be deemed to be
a forcible or unlawful entry into, or a detainer of, the Premises, or an actual
or constructive eviction of Tenant from any portion of the
Premises.

        ARTICLE
23 - TENANT PARKING

         

        Tenant
shall have the right to use, free from charge, up to the number of undesignated,
unreserved parking spaces set forth in Section 11 of the Summary for parking in
the Building Parking Facility. From and after the earlier to occur of the RP
Commencement Date, the number of undesignated, unreserved parking spaces
available to Tenant shall be increased to 223. Landlord shall not be required to
enforce Tenant's right to use such parking spaces. Tenant shall abide, and cause
its employees, representatives and visitors who utilize the Building Parking
Facility to abide, by all parking rules and regulations for parking in the
Building Parking Facility, as may be adopted and/or modified by Landlord and/or
Landlord's parking operator from time to time.

         

        ARTICLE
24 - MISCELLANEOUS PROVISIONS

         

        24.1
TERMS; CAPTIONS. The necessary grammatical changes required to make the
provisions hereof apply either to corporations or partnerships or individuals,
men or women, as the case may require, shall in all cases be assumed as though
in each case fully expressed. The captions of Articles and Sections are for
convenience only and shall not be deemed to limit, construe, affect or alter the
meaning of such Articles and Sections.

         

        24.2
BINDING EFFECT. Each of the provisions of this Lease shall extend to and shall,
as the case may require, bind or inure to the benefit not only of Landlord and
of Tenant, but also of their respective successors or assigns, provided this
clause shall not permit any assignment by Tenant contrary to the provisions of
Article 14 of this Lease.

         

        24.3 NO
WAIVER. No waiver of any provision of this Lease shall be implied by any failure
of a party to enforce any remedy on account of the violation of such provision,
even if such violation shall continue or be repeated subsequently, any waiver by
a party of any provision of this Lease may only be in writing, and no express
waiver shall affect any provision other than the one specified in such waiver
and that one only for the time and in the manner specifically stated. No receipt
of monies by Landlord from Tenant after the termination of this Lease shall in
any way alter the length of the Lease Term or of Tenant's right of possession
hereunder or after the giving of any notice shall reinstate, continue or extend
the Lease Term or affect any notice given Tenant prior to the receipt of such
monies, it being agreed that after the service of notice or the commencement of
a suit or after final judgment for possession of the Premises, Landlord may
receive and collect any Rent due, and the payment of said Rent shall not waive
or affect said notice, suit or judgment.

        24.4
MODIFICATION OF LEASE. Should any current or prospective mortgagee or ground
lessor for the Building require a modification or modifications of this Lease,
which modification or modifications will not cause an increased cost or expense
to Tenant or in any other way materially and adversely change the rights or
obligations of Tenant hereunder, then and in such event, Tenant agrees that this
Lease may be so modified and agrees to execute whatever documents are required
therefor and deliver the same to Landlord within ten (10) days following the
request therefor. Should Landlord or any such current or prospective mortgagee
or ground lessor require execution of a short form of Lease for recording,
containing, among other customary provisions, the names of the parties, a
description of the Premises and the Lease Term, Tenant agrees to execute such
short form of Lease and to deliver the same to Landlord within ten (10) days
following the request therefor.

         

        
          
             

          

          
            18

            
              

            

          

          
             

          

        

         

        24.5
TRANSFER OF LANDLORD'S INTEREST. Tenant acknowledges that Landlord has the right
to transfer all or any portion of its interest in the Real Property and Building
and in this Lease, and Tenant agrees that in the event of any such transfer,
Landlord shall automatically be released from all further liability under this
Lease and Tenant agrees to look solely to such transferee for the performance of
Landlord's obligations hereunder after the date of transfer. The liability of
Landlord under this Lease is limited to its actual period of ownership of title
to the Building. The liability of any transferee of Landlord shall be limited to
the interest of such transferee in the Real Property, Complex and Building and
such transferee shall be without personal liability under this Lease, and Tenant
hereby expressly waives and releases such personal liability on behalf of itself
and all persons claiming by, through or under Tenant. Tenant further
acknowledges that Landlord may assign its interest in this Lease to a mortgage
lender as additional security and agrees that such an assignment shall not
release Landlord from its obligations hereunder and that Tenant shall continue
to look to Landlord for the performance of its obligations
hereunder.

         

        24.6
PROHIBITION AGAINST RECORDING. Except as provided in Section 24.4 of this Lease,
neither this Lease, nor any memorandum, affidavit or other writing with respect
thereto, shall be recorded by Tenant or by anyone acting through, under or on
behalf of Tenant, and the recording thereof in violation of this provision shall
make this Lease null and void at Landlord's election.

         

        24.7
LANDLORD'S TITLE; AIR RIGHTS. Landlord's title is and always shall be paramount
to the title of Tenant. Nothing herein contained shall empower Tenant to do any
act which can, shall or may encumber the title of Landlord. No rights to any
view or to light or air over any property, whether belonging to Landlord or any
other person, are granted to Tenant by this Lease.

         

        24.8
TENANT'S SIGNS. Tenant shall be entitled, at its sole cost and expense, to one
(1) identification sign outside of the Premises on the floor on which the
Premises are located. The location, quality, design, style, lighting and size of
such sign shall be consistent with the Landlord's Building standard signage
program and shall be subject to Landlord's prior written approval, in its
reasonable discretion. Subject to final agreement with the Existing Tenant,
Tenant shall have rights to one-half (1/2) of the monument sign currently used
by the Existing Tenant. Upon the earlier to occur of the RP Commencement Date,
Tenant shall have exclusive rights to the entire monument sign. Upon the
expiration or earlier termination of this Lease, Tenant shall be responsible, at
its sole cost and expense, for the removal of such signage and the repair of all
damage to the Building caused by such removal. Except for such identification
sign, Tenant may not install any signs on the exterior or roof of the Building
or the Common Areas of the Building, the Complex or the Real Property. Any
signs, window coverings, or blinds (even if the same are located behind the
Landlord approved window coverings for the Building), or other items visible
from the exterior of the Premises or Building are subject to the prior approval
of Landlord, in its sole and absolute discretion.

         

        24.9
RELATIONSHIP OF PARTIES. Nothing contained in this Lease shall be deemed or
construed by the parties hereto or by any third party to create the relationship
of principal and agent, partnership, joint venturer or any association between
Landlord and Tenant, it being expressly understood and agreed that neither the
method of computation of Rent nor any act of the parties hereto shall be deemed
to create any relationship between Landlord and Tenant other than the
relationship of landlord and tenant.

         

        24.10
APPLICATION OF PAYMENTS. Landlord shall have the right to apply payments
received from Tenant pursuant to this Lease, regardless of Tenant's designation
of such payments, to satisfy any obligations of Tenant hereunder, in such order
and amounts as Landlord, in its sole discretion, may elect.

         

        24.11
TIME OF ESSENCE. Time is of the essence of this Lease and each of its
provisions.

         

        24.12
PARTIAL INVALIDITY. If any term, provision or condition contained in this Lease
shall, to any extent, be invalid or unenforceable, the remainder of this Lease,
or the application of such term, provision or condition to persons or
circumstances other than those with respect to which it is invalid or
unenforceable, shall not be affected thereby, and each and every other term,
provision and condition of this Lease shall be valid and enforceable to the
fullest extent possible permitted by law.

         

        24.13 NO
WARRANTY. In executing and delivering this Lease, Tenant has not relied on any
representation, including, but not limited to, any representation whatsoever as
to the amount of any item comprising Additional Rent or the amount of the
Additional Rent in the aggregate or that Landlord is furnishing the same
services to other tenants, at all, on the same level or on the same basis, or
any warranty or any statement of Landlord which is not set forth herein or in
one or more of the Exhibits attached hereto.

         

        24.14
LANDLORD EXCULPATION. It is expressly understood and agreed that notwithstanding
anything in this Lease to the contrary, and notwithstanding any applicable law
to the contrary, the liability of Landlord and the Landlord Parties hereunder
(including any successor landlord) and any recourse by Tenant against Landlord
or the Landlord Parties shall be limited solely and exclusively to an amount
which is equal to the interest of Landlord in the Building, and neither
Landlord, nor any of the Landlord Parties shall have any personal liability
therefor, and Tenant hereby expressly waives and releases such personal
liability on behalf of itself and all persons claiming by, through or under
Tenant.

         

        24.15
ENTIRE AGREEMENT. It is understood and acknowledged that there are no oral
agreements between the parties hereto affecting this Lease and this Lease
supersedes and cancels any and all previous negotiations, arrangements,
brochures, agreements and understandings, if any, between the parties hereto or
displayed by Landlord to Tenant with respect to the subject matter thereof, and
none thereof shall be used to interpret or construe this Lease. This Lease and
any side letter or separate agreement executed by Landlord and Tenant in
connection with this Lease and dated of even date herewith contain all of the
terms, covenants, conditions, warranties and agreements of the parties relating
in any manner to the rental, use and occupancy of the Premises, shall be
considered to be the only agreement between the parties hereto and their
representatives and agents, and none of the terms, covenants, conditions or
provisions of this Lease can be modified, deleted or added to except in writing
signed by the parties hereto. All negotiations and oral agreements acceptable to
both parties have been merged into and are included herein. There are no other
representations or warranties between the parties, and all reliance with respect
to representations is based totally upon the representations and agreements
contained in this Lease.

        
          
             

          

          
            19

            
              

            

          

          
             

          

        

        24.16
RIGHT TO LEASE. Landlord reserves the absolute right to effect such other
tenancies in the Building as Landlord in the exercise of its sole business
judgment shall determine to best promote the interests of the Building. Tenant
does not rely on the fact, nor does Landlord represent, that any specific tenant
or type or number of tenants shall, during the Lease Term, occupy any space in
the Building.

         

        24.17
FORCE MAJEURE. Any prevention, delay or stoppage due to strikes, lockouts, labor
disputes, acts of God, inability to obtain services, labor, or materials or
reasonable substitutes therefor, governmental actions, civil commotions, fire or
other casualty, and other causes beyond the reasonable control of the party
obligated to perform, except with respect to the obligations imposed with regard
to Rent and other charges to be paid by Tenant pursuant to this Lease
(collectively, the "Force Majeure"), notwithstanding anything to the contrary
contained in this Lease, shall excuse the performance of such party for a period
equal to any such prevention, delay or stoppage and, therefore, if this Lease
specifies a time period for performance of an obligation of either party, that
time period shall be extended by the period of any delay in such party's
performance caused by a Force Majeure.

         

        24.18
WAIVER OF REDEMPTION BY TENANT. Tenant hereby waives for Tenant and for all
those claiming under Tenant all right now or hereafter existing to redeem by
order or judgment of any court or by any legal process or writ, Tenant's right
of occupancy of the Premises after any termination of this Lease.

         

        24.19
NOTICES. All notices, demands, statements or communications (collectively,
"Notices") given or required to be given by either party to the other hereunder
shall be in writing, shall be sent by United States certified or registered
mail, postage prepaid, return receipt requested, or delivered personally (i) to
Tenant at the appropriate address set forth in Section 5 of the Summary, or to
such other place as Tenant may from time to time designate in a Notice to
Landlord; or (ii) to Landlord at the addresses of Landlord's agent set forth in
Section 3 of the Summary, or to such other firm or to such other place as
Landlord may from time to time designate in a Notice to Tenant. Any Notice will
be deemed given on the date it is mailed as provided in this Section 24.19 or
upon the date personal delivery is made. If Tenant is notified of the identity
and address of Landlord's mortgagee or ground or underlying lessor, Tenant shall
give to such mortgagee or ground or underlying lessor written notice of any
default by Landlord under the terms of this Lease by registered or certified
mail, and such mortgagee or ground or underlying lessor shall be given a
reasonable opportunity to cure such default prior to Tenant's exercising any
remedy available to Tenant.

        24.20
JOINT AND SEVERAL. If there is more than one Tenant, the obligations imposed
upon Tenant under this Lease shall be joint and several.

         

        24.21
AUTHORITY. If Tenant is a corporation, limited liability company or partnership,
each individual executing this Lease on behalf of Tenant hereby represents and
warrants that Tenant is a duly formed and existing entity qualified to do
business in the state in which the Building is located and that Tenant has full
right and authority to execute and deliver this Lease and that each person
signing on behalf of Tenant is authorized to do so and to bind Tenant
hereunder.

         

        24.22
JURY TRIAL; ATTORNEYS' FEES. IF EITHER PARTY COMMENCES LITIGATION AGAINST THE
OTHER FOR THE SPECIFIC PERFORMANCE OF THIS LEASE, FOR DAMAGES FOR THE BREACH
HEREOF OR OTHERWISE FOR ENFORCEMENT, PROTECTION OR ESTABLISHMENT OF ANY RIGHT OR
REMEDY HEREUNDER, THE PARTIES HERETO AGREE TO AND HEREBY DO WAIVE ANY RIGHT TO A
TRIAL BY JURY. In the event of any such commencement of litigation, the
prevailing party shall be entitled to recover from the other party such costs
and reasonable attorneys' fees as may have been incurred, including any and all
costs incurred in enforcing, perfecting and executing such
judgment.

         

        24.23
GOVERNING LAW. This Lease shall be construed and enforced in accordance with the
laws of the state in which the Building is located.

         

        24.24
SUBMISSION OF LEASE. Submission of this instrument for examination or signature
by Tenant does not constitute a reservation of or an option for lease, and it is
not effective as a lease or otherwise until execution and delivery by both
Landlord and Tenant.

         

        24.25
BROKERS. Landlord and Tenant hereby warrant to each other that they have had no
dealings with any real estate broker or agent in connection with the negotiation
of this Lease, excepting only the real estate brokers or agents specified in
Section 12 of the Summary (the "Brokers"), and that they know of no other real
estate broker or agent who is entitled to a commission in connection with this
Lease. Each party shall indemnify and hold harmless the other from and against
any and all liabilities or expenses arising out of claims made for a fee or
commission by any real estate broker, agent or finder in connection with the
Premises and this Lease other than Brokers, if any, and the payment of the
Brokers by Landlord (which payment is Landlord's sole responsibility) resulting
from the actions of the indemnifying party. Any real estate brokerage commission
or finder's fee payable to the Brokers in connection with this Lease shall only
be payable and applicable to the extent of the initial term of the Lease, be
paid by Landlord and shall be payable 50% upon mutual lease execution and
delivery, 25% upon occupancy of the Initial Premises, and 25% upon occupancy of
the Remaining Premises. Unless expressly agreed to in writing by Landlord and
Brokers, no real estate brokerage commission or finder's fee shall be owed to,
or otherwise payable to, the Brokers for any renewals or other extensions of the
initial term of this Lease or for any additional space leased by Tenant other
than the Premises as same exists as of the date on which Tenant executes this
Lease. Tenant further represents and warrants to Landlord that Tenant will not
receive (i) any portion of any brokerage commission or finder's fee payable to
the Broker(s) in connection with this Lease or (ii) any other form of
compensation or incentive from the Broker(s) with respect to this
Lease.

        24.26
INDEPENDENT COVENANTS. This Lease shall be construed as though the covenants
herein between Landlord and Tenant are independent and not dependent and Tenant
hereby expressly waives the benefit of any statute to the contrary and agrees
that if Landlord fails to perform its obligations set forth herein, Tenant shall
not be entitled to make any repairs or perform any acts hereunder at Landlord's
expense or to any setoff of the Rent or other amounts owing hereunder against
Landlord; provided, however, that the foregoing shall in no way impair the right
of Tenant to commence a separate action against Landlord for any violation by
Landlord of the provisions hereof so long as notice is first given to Landlord
and any holder of a mortgage or deed of trust covering the Building, Complex,
Real Property or any portion thereof, of whose address Tenant has theretofore
been notified, and an opportunity is granted to Landlord and such holder to
correct such violations as provided above. Each provision to be performed by
Tenant hereunder shall be deemed to be both a covenant and a
condition.

         

        
          
             

          

          
            20

            
              

            

          

          
             

          

        

         

        24.27
BUILDING NAME AND SIGNAGE. Landlord shall have the right at any time to change
the name of the Building and to install, affix and maintain any and all signs on
the exterior and on the interior of the Building as Landlord may, in Landlord's
sole discretion, desire. Tenant shall not use the name of the Building or use
pictures or illustrations of the Building in advertising or other publicity,
without the prior written consent of Landlord. Landlord shall not use the name
of the Tenant in advertising or other publicity, without the prior written
consent of Tenant, except in connection with the proposed sale, financing, joint
venture or other investment in the Building, Complex or Real
Property.

         

        24.28
BUILDING DIRECTORY. As of the Commencement Date Tenant shall be entitled to one
(1) line on the Building directory to display Tenant's name and location in the
Building. Tenant shall be entitled to the entire Building directory as of the RP
Commencement Date.

         

        24.29
CONFIDENTIALITY. Tenant acknowledges that the content of this Lease and any
related documents are confidential information. Tenant shall keep such
confidential information strictly confidential and shall not disclose such
confidential information to any person or entity other than Tenant's financial,
legal, and space planning consultants, or as may be required by
law.

         

        24.30
LANDLORD RENOVATIONS. It is specifically understood and agreed that Landlord has
no obligation and has made no promises to alter, remodel, improve, renovate,
repair or decorate the Premises, Building, Complex, Real Property, or any part
thereof and that no representations or warranties respecting the condition of
the Premises, the Building, the Complex or the Real Property have been made by
Landlord to Tenant, except as specifically set forth in this Lease.

         

        However,
Tenant acknowledges that Landlord may from time to time, at Landlord's sole
option, renovate, improve, alter, or modify (collectively, the "Renovations")
the Building, Premises, Complex and/or Real Property, including without
limitation the Building Parking Facility, Common Areas, systems and equipment,
roof, and structural portions of the same, which Renovations may include,
without limitation, (i) modifying the Common Areas and tenant spaces to comply
with applicable laws and regulations, including regulations relating to the
physically disabled, seismic conditions, and building safety and security, and
(ii) installing new carpeting, lighting, and wall coverings in the Building
Common Areas, and in connection with such Renovations, Landlord may, among other
things, erect scaffolding or other necessary structures in the Building, limit
or eliminate access to portions of the Complex and/or Real Property, including
portions of the Common Areas, or perform work in the Building, which work may
create noise, dust or leave debris in the Building. Tenant hereby agrees that
such Renovations and Landlord's actions in connection with such Renovations
shall in no way constitute a constructive eviction of Tenant nor entitle Tenant
to any abatement of Rent. Landlord shall have no responsibility or for any
reason be liable to Tenant for any direct or indirect injury to or interference
with Tenant's business arising from the Renovations, nor shall Tenant be
entitled to any compensation or damages from Landlord for loss of the use of the
whole or any part of the Premises or of Tenant's personal property or
improvements resulting from the Renovations or Landlord's actions in connection
with such Renovations, or for any inconvenience or annoyance occasioned by such
Renovations or Landlord's actions in connection with such Renovations.
Landlord's right pursuant to this paragraph 24.30 shall be subject to the
condition that exercise of any of such rights shall not unreasonably interfere
with Tenant's use of the Premises, or decrease the number of Tenant's parking
spaces below the number required to be provided hereunder.

        24.31
[OMITTED]

         

        24.32
MERGER. The voluntary or other surrender of this Lease by Tenant, the mutual
termination or cancellation hereof by Landlord and Tenant, or a termination of
this Lease by Landlord for a material default by Tenant hereunder, shall not
work a merger, and, at the sole option of Landlord, (i) shall terminate all or
any existing subleases or subtenancies, or (ii) may operate as an assignment to
Landlord of any or all of such subleases or subtenancies. Landlord's election of
either or both of the foregoing options shall be exercised by delivery by
Landlord of written notice thereof to Tenant and all known subtenants under any
sublease.

         

        ARTICLE
25 - MORTGAGEE PROTECTION

         

        Upon any
default on the part of Landlord, Tenant will give written notice by registered
or certified mail to any beneficiary of a deed of trust or mortgagee of a
mortgage covering the Premises who has provided Tenant with notice of their
interest together with an address for receiving notice, and shall offer such
beneficiary or mortgagee a reasonable opportunity to cure the default (which, in
no event shall be less than ninety (90) days), including time to obtain
possession of the Premises by power of sale or a judicial foreclosure, if such
should prove necessary to effect a cure. If such default cannot be cured within
such time period, then such additional time as may be necessary will be given to
such beneficiary or mortgagee to effect such cure so long as such beneficiary or
mortgagee has commenced the cure within the original time period and thereafter
diligently pursues such cure to completion, in which event this Lease shall not
be terminated while such cure is being diligently pursued. Tenant agrees that
each lender to whom this Lease has been assigned by Landlord is an express third
party beneficiary hereof. Tenant shall not make any prepayment of Rent more than
one (1) month in advance without the prior written consent of each such lender,
except if Tenant is required to make quarterly payments of Rent in advance
pursuant to the provisions of this Lease. Tenant waives the collection of any
deposit from such lender(s) or any purchaser at a foreclosure sale of such
lender(s)' deed of trust unless the lender(s) or such purchaser shall have
actually received and not refunded the deposit. Tenant agrees to make all
payments under this Lease to the lender with the most senior encumbrance upon
receiving a direction, in writing, to pay said amounts to such lender. Tenant
shall comply with such written direction to pay without determining whether an
event of default exists under such lender's loan to Landlord.

        
          
             

          

          
            21

            
              

            

          

          
             

          

        

        ARTICLE
26 - AMERICANS WITH DISABILITIES ACT

         

        Landlord
and Tenant hereby agree and acknowledge that the Premises, the Building, the
Complex and/or the Real Property may be subject to the requirements of the
Americans with Disabilities Act, a federal law codified at 42 U.S.C. 12101 et
seq., including, but not limited to Title III thereof, all regulations and
guidelines related thereto, together with any and all laws, rules, regulations,
ordinances, codes and statutes now or hereafter enacted by local or state
agencies having jurisdiction thereof, including all requirements of Title 24 of
the State of California, as the same may be in effect on the date of this Lease
and may be hereafter modified, amended or supplemented (collectively, the
"ADA"). Any Alterations to be constructed hereunder shall be in compliance with
the requirements of the ADA, and all costs incurred for purposes of compliance
therewith shall be a part of and included in the costs of the Alterations.
Tenant shall be solely responsible for conducting its own independent
investigation of this matter and for ensuring that the design of all Alterations
strictly comply with all requirements of the ADA. Subject to reimbursement as
part of Operating Expenses, if any barrier removal work or other work is
required to the Building, the Common Areas, or the Complex under the ADA, then
such work shall be the responsibility of Landlord; provided, if such work is
required under the ADA as a result of Tenant's particular use of the Premises or
any work or alteration made to the Premises by or on behalf of Tenant, then such
work shall be performed by Landlord at the sole cost and expense of Tenant.
Except as otherwise expressly provided in this Article 26, Tenant shall be
responsible at its sole cost and expense for fully and faithfully complying with
all applicable requirements of the ADA, including without limitation, not
discriminating against any disabled persons in the operation of Tenant's
business in or about the Premises, and offering or otherwise providing auxiliary
aids and services as, and when, required by the ADA. Within ten (10) days after
receipt, Landlord and Tenant shall advise the other party in writing, and
provide the other with copies of (as applicable), any notices alleging violation
of the ADA relating to any portion of the Premises or the Building; any claims
made or threatened in writing regarding noncompliance with the ADA and relating
to any portion of the Premises or the Building; or any governmental or
regulatory actions or investigations instituted or threatened regarding
noncompliance with the ADA and relating to any portion of the Premises or the
Building. Tenant shall and hereby agrees to protect, defend (with counsel
acceptable to Landlord) and hold Landlord and the other Indemnitees harmless and
indemnify the Indemnitees from and against all liabilities, damages, claims,
losses, penalties, judgments, charges and expenses (including reasonable
attorneys' fees, costs of court and expenses necessary in the prosecution or
defense of any litigation including the enforcement of this provision) arising
from or in any way related to, directly or indirectly, Tenant's or Tenant's
Representatives' violation or alleged violation of the ADA. Tenant agrees that
the indemnity obligations of Tenant herein accruing during the Term hereof shall
survive the expiration or earlier termination of this Lease.

        ARTICLE
27 - HAZARDOUS MATERIALS

         

        27.1
DEFINITION OF HAZARDOUS MATERIALS. As used in this Lease, the term Hazardous
Materials shall mean and include (a) any hazardous or toxic wastes, materials or
substances, and other pollutants or contaminants, which are or become regulated
by any Environmental Laws; (b) petroleum, petroleum by products, gasoline,
diesel fuel, crude oil or any fraction thereof; (c) asbestos and asbestos
containing material, in any form, whether friable or non-friable;

         

        (d)
polychlorinated biphenyls; (e) radioactive materials; (f) lead and
lead-containing materials; (g) any other material, waste or substance displaying
toxic, reactive, ignitable or corrosive characteristics, as all such terms are
used in their broadest sense, and are defined or become defined by any
Environmental Law (defined below); or (h) any materials which cause or threatens
to cause a nuisance upon or waste to any portion of the Premises, the Building,
the Real Property, the Complex or any surrounding property; or poses or
threatens to pose a hazard to the health and safety of persons on the Premises
or any surrounding property.

         

        27.2
PROHIBITION; ENVIRONMENTAL LAWS. Except for nominal amounts of ordinary
household cleaners, office supplies and janitorial supplies which are not
regulated by any Environmental Laws, Tenant shall not use nor store any
Hazardous Materials on, in, or about any portion of the Premises, the Building,
the Complex, the Real Property without, in each instance, obtaining Landlord's
prior written consent thereto. In all events any usage or storage of any
Hazardous Materials by Tenant shall be in full compliance with any and all
local, state and federal environmental, health and/or safety-related laws,
statutes, orders, standards, courts' decisions, ordinances, rules and
regulations (as interpreted by judicial and administrative decisions), decrees,
directives, guidelines, permits or permit conditions, currently existing and as
amended, enacted, issued or adopted in the future which are or become applicable
to Tenant or all or any portion of the Premises (collectively, the
"Environmental Laws"). Landlord shall have the right at all times during the
Lease Term following no less than 24 hours' notice (except in case of
emergency), and subject to Tenant's reasonable security requirements to (i)
inspect the Premises, (ii) conduct tests and investigations to determine whether
Tenant is in compliance with the provisions of this Article 27, and (iii)
request lists of all Hazardous Materials used, stored or otherwise located in,
on or about any portion of the Premises. The cost of all such inspections, tests
and investigations shall be borne solely by Tenant, if Landlord reasonably
determines that Tenant or any of Tenant's Representatives are directly or
indirectly responsible in any manner for any contamination revealed by such
inspections, tests and investigations. The aforementioned rights granted herein
to Landlord and its representatives shall not create (a) a duty on Landlord's
part to inspect, test, investigate, monitor or otherwise observe the Premises or
the activities of Tenant and Tenant's Representatives with respect to Hazardous
Materials, including without limitation, Tenant's operation, use and any
remediation related thereto, or (b) liability on the part of Landlord and its
representatives for Tenant's use, storage, disposal or remediation of Hazardous
Materials, it being understood that Tenant shall be solely responsible for all
liability in connection therewith.

        27.3
TENANT'S ENVIRONMENTAL OBLIGATIONS. Tenant, at its sole cost and expense,
covenants and warrants to promptly investigate, clean up, remove, restore and
otherwise remediate (including, without limitation, preparation of any
feasibility studies or reports and the performance of any and all closures) any
spill, release, discharge, disposal, emission, migration or transportation of
Hazardous Materials arising from or related to the intentional or negligent acts
or omissions of Tenant or any of Tenant's Representatives such that the affected
portions of the Premises, Building, Complex, Real Property and any adjacent
property are returned to the condition existing prior to the appearance of such
Hazardous Materials. Any such investigation, clean up, removal, restoration and
other remediation shall only be performed after Tenant has obtained Landlord's
prior written consent, which consent shall not be unreasonably withheld so long
as such actions would not potentially have a material adverse long-term or
short-term effect on any portion of the Premises, the Building, the Real
Property or the Complex. Notwithstanding the foregoing, Tenant shall be entitled
to respond immediately to an emergency without first obtaining Landlord's prior
written consent. Tenant, at its sole cost and expense, shall conduct and
perform, or cause to be conducted and performed, all closures as required by any
Environmental Laws or any agencies or other governmental authorities having
jurisdiction thereof. If Tenant fails to so promptly investigate, clean up,
remove, restore, provide closure or otherwise so remediate, Landlord may, but
without obligation to do so, take any and all steps necessary to rectify the
same and Tenant shall promptly reimburse Landlord, upon demand, for all costs
and expenses to Landlord of performing investigation, clean up, removal,
restoration, closure and remediation work. All such work undertaken by Tenant,
as required herein, shall be performed in such a manner so as to enable Landlord
to make full economic use of the Premises, the Building, the Real Property and
the Complex after the satisfactory completion of such work.

         

        
          
             

          

          
            22

            
              

            

          

          
             

          

        

         

        27.4
ENVIRONMENTAL INDEMNITY. In addition to Tenant's obligations as set forth
hereinabove, Tenant shall, protect, indemnify, defend (with counsel reasonably
acceptable to Landlord) and hold Landlord and the other Indemnitees harmless
from and against any and all claims, judgments, damages, penalties, fines,
liabilities, losses (including, without limitation, diminution in value of any
portion of the Premises, the Building, the Real Property or the Complex, damages
for the loss of or restriction on the use of rentable or usable space, and from
any adverse impact of Landlord's marketing of any space within the Building
and/or Complex), suits, administrative proceedings and costs (including,
but not limited to, attorneys' and consultant fees and court costs) arising at
any time during or after the Lease Term in connection with or related to,
directly or indirectly, the use, presence, transportation, storage, disposal,
migration, removal, spill, release or discharge of Hazardous Materials on, in or
about any portion of the Premises, the Common Areas, the Building, the Real
Property or the Complex as a result (directly or indirectly) of the intentional
or negligent acts or omissions of Tenant or any of Tenant's Representatives.
Neither the written consent of Landlord to the presence, use or storage of
Hazardous Materials in, on, under or about any portion of the Premises, the
Building, the Real Property and/or the Complex, nor the strict compliance by
Tenant with all Environmental Laws shall excuse Tenant from its obligations of
indemnification pursuant hereto. Tenant shall not be relieved of its
indemnification obligations under the provisions of this Section 27.4 due to
Landlord's status as either an "owner" or "operator" under any Environmental
Laws.

         

        27.5
SURVIVAL. Tenant's obligations and liabilities pursuant to the provisions of
this Article 27 shall survive the expiration or earlier termination of this
Lease. If it is determined by Landlord's consultants that the condition of all
or any portion of the Premises, the Building, the Real Property and/or the
Complex is not in compliance with the provisions of this Lease with respect to
Hazardous Materials, including without limitation, all Environmental Laws at the
expiration or earlier termination of this Lease, then in Landlord's sole
discretion, Landlord may require Tenant to hold over possession of the Premises
until Tenant can surrender the Premises to Landlord in the condition in which
the Premises existed as of the Lease Commencement Date and prior to the
appearance of such Hazardous Materials except for reasonable wear and tear,
including without limitation, the conduct or performance of any closures as
required by any Environmental Laws. The burden of proof hereunder shall be upon
Tenant. For purposes hereof, the term "reasonable wear and tear" shall not
include any deterioration in the condition or diminution of the value of any
portion of the Premises, the Building, the Real Property and/or the Complex in
any manner whatsoever related to directly, or indirectly, Hazardous Materials.
Any such holdover by Tenant will be with Landlord's consent and will not be
terminable by Tenant in any event or circumstance.

         

        27.6
EXCULPATION OF TENANT: Tenant shall not be liable to Landlord for or otherwise
obligated to Landlord under any provision of the Lease with respect to the
following: (i) any claim, remediation, obligation, investigation, obligation,
liability, cause of action, attorney's fees, consultants' cost, expense or
damage resulting from any Hazardous Materials present in, on or about the
Premises, the Building, the Real Property or the Complex to the extent not
caused nor otherwise permitted, directly or indirectly, by Tenant or Tenant's
Representatives; or (ii) the removal, investigation, monitoring or remediation
of any Hazardous Material present in, on or about the Premises, the Building,
the Real Property or the Complex directly caused by any source, including third
parties, other than Tenant or Tenant's Representatives; provided, however,
Tenant shall be fully liable for and otherwise obligated to Landlord under the
provisions of this Lease for all liabilities, costs, damages, penalties, claims,
judgments, expenses (including without limitation, attorneys' and experts' fees
and costs) and losses to the extent (a) Tenant or any of Tenant's
Representatives contributes to the presence of such Hazardous Materials, or
Tenant and/or any of Tenant's Representatives exacerbates the conditions caused
by such Hazardous Materials, or (b) Tenant and/or Tenant's Representatives
allows or permits persons over which Tenant or any of Tenant's Representatives
has control, and/or for which Tenant or any of Tenant's Representatives are
legally responsible for, to cause such Hazardous Materials to be present in, on,
under, through or about any portion of the Premises, the Common Areas, the
Building, the Real Property or the Complex, or (c) Tenant and/or any of Tenant's
Representatives does not take all reasonably appropriate actions to prevent such
persons over which Tenant or any of Tenant's Representatives has control and/or
for which Tenant or any of Tenant's Representatives are legally responsible from
causing the presence of Hazardous Materials in, on, under, through or about any
portion of the Premises, the Common Areas, the Building, the Real Property or
the Complex.

         

        ARTICLE
28 - FINANCIAL STATEMENTS

         

        Tenant,
for the reliance of Landlord, any lender holding or anticipated to acquire a
lien upon the Premises, the Building, the Real Property or the Complex or any
portion thereof, or any prospective purchaser of the Building, the Real Property
or the Complex or any portion thereof, within ten (10) days after Landlord's
request therefor, but not more often than once annually so long as Tenant is not
in default of this Lease, shall deliver to Landlord the then current audited
financial statements of Tenant (including interim periods following the end of
the last fiscal year for which annual statements are available) which statements
shall be prepared or compiled by a certified public accountant and shall present
fairly the financial condition of Tenant at such dates and the result of its
operations and changes in its financial positions for the periods ended on such
dates. If an audited financial statement has not been prepared, Tenant shall
provide Landlord with an unaudited financial statement and/or such other
information, the type and form of which are acceptable to Landlord in Landlord's
reasonable discretion, which reflects the financial condition of Tenant. If
Landlord so requests, Tenant shall deliver to Landlord an opinion of a certified
public accountant, including a balance sheet and profit and loss statement for
the most recent prior year, all prepared in accordance with generally accepted
accounting principles consistently applied.

        IN
WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be executed the
day and date first above written

         

        
          
             

          

          
            23

            
              

            

          

          
             

          

        

         

        TENANT:

         

        AVIGEN,
INC.,

        a
Delaware corporation

         

        
          	 
      	
                  By:

                	
                  /s/ JOHN MONAHAN

                	 
	 
      	
                  Name:

                	
                  John Monahan

                	 
	 
      	
                  Title:

                	
                  President & CEO

                	 
	 
      	 
      	 
      	 
	 
      	
                  By:

                	
                  /s/ THOMAS J. PAULSON

                	 
	 
      	
                  Name:

                	
                  Thomas J. Paulson

                	 
	 
      	
                  Title:

                	
                  VP-Finance, CFO

                	 
	 
      	
                  Date:

                	
                  11/3/00

                	 

        

         

         

        LANDLORD:

         

        LINCOLN-RECP
EMPIRE OPCO, LLC,

        a
Delaware limited liability company

         

        By:
LEGACY PARTNERS COMMERCIAL, INC.,

        as
manager and agent for Lincoln-RECP Empire OPCO, LLC

         

        
          	 
      	 By:	
                   /s/
      ROBERT F. PHIPPS

                	 
      
	 
      	 	
                  Senior
      Vice President

                	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                  Date:

                	 
      	 
      

        

        

        
          
            
            

          

          
            24

            
              

            

          

          
            
            

          

        

         

        EXHIBIT
A

        OUTLINE
OF FLOOR PLAN OF PREMISES

         

        
          
             

          

          
            A-1

            
              

            

          

          
             

          

        

        EXHIBIT
B

        [INTENTIONALLY
OMITTED]

         

        
          
            
            

          

          
            B-1

            
              

            

          

          
            
            

          

        

         

        EXHIBIT
C

        AMENDMENT
TO LEASE

         

         

        This
AMENDMENT TO LEASE ("Amendment") is made and entered into effective as of
November 2, 2000, by and between LINCOLN-RECP EMPIRE OPCO, LLC, a Delaware
limited liability company ("Landlord"), and AVIGEN, INC., a Delaware corporation
("Tenant"), with reference to the following facts.

         

        RECITALS:

         

        A.
Landlord and Tenant entered into that certain Office Lease dated as of
_____________________ (the "Lease") pursuant to which Landlord leased to Tenant
and Tenant leased from Landlord certain "Premises", as described in the Lease,
known as Suite ____ of the Building located at 1301 Harbor Bay Parkway, Alameda,
California 94502.

         

        B. Except
as otherwise set forth herein, all capitalized terms used in this Amendment
shall have the same meaning given such terms in the Lease.

         

        C.
Landlord and Tenant desire to amend the Lease to confirm the commencement and
expiration dates of the term, as hereinafter provided.

         

        NOW,
THEREFORE, in consideration of the foregoing Recitals and the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

         

        1.
CONFIRMATION OF DATES. The parties hereby confirm that (a) the Premises are
Substantially Complete, (b) the term of the Lease commenced as of
____________________ (the "Lease Commencement Date") for a term of
_________________________ ending on _______________________ (the "Lease
Expiration Date") (unless sooner terminated as provided in the Lease and (c) in
accordance with the Lease, Rent commenced to accrue on
_______________________________.

         

        2. NO
FURTHER MODIFICATION. Except as set forth in this Amendment, all of the terms
and provisions of the Lease shall remain unmodified and in full force and
effect.

         

        IN
WITNESS WHEREOF, this Amendment to Lease has been executed as of the day and
year first above written.

         

        TENANT:

         

        AVIGEN,
INC.,

        a
Delaware corporation

         

        
          	
                  By:

                	 
      
	
                  Name:

                	 
      
	
                  Title:

                	 
      
	 
      	 
      
	
                  By:

                	 
      
	
                  Name:

                	 
      
	
                  Title:

                	 
      
	 
      	 
      
	
                  Date:

                	 
      

        

         

        LANDLORD:

         

        LINCOLN-RECP
EMPIRE OPCO, LLC,

        a
Delaware limited liability company

        

        By:
LEGACY PARTNERS COMMERCIAL, INC.,

        as
manager and agent for Lincoln-RECP Empire OPCO, LLC

        

        
          	
                  By:

                	 
      
	 
      	 
      
	 
      	
                  Senior
      Vice President

                
	 
      	 
      
	
                  Date:

                	 
      

        

        

        
          
            
            

          

          
            C-1

            
              

            

          

          
            
            

          

        

         

        EXHIBIT
D

        RULES
AND REGULATIONS

         

        Tenant
shall faithfully observe and comply with the following Rules and Regulations.
Landlord shall not be responsible to Tenant for the nonperformance of any of
said Rules and Regulations by or otherwise with respect to the acts or omissions
of any other tenants or occupants of the Building. Notwithstanding anything to
the contrary contained in this section, if any rule or regulation is in conflict
with any term, covenant or condition of this Lease, this Lease shall prevail. In
addition, no such rule or regulation, or any subsequent amendment thereto
adopted by Landlord, shall in any way materially alter, reduce or adversely
affect any of Tenant's rights or enlarge Tenant's obligations under this
Lease.

         

        1. Tenant
shall not alter any lock or install any new or additional locks or bolts on any
doors or windows of the Premises without obtaining Landlord's prior written
consent. Tenant shall bear the cost of any lock changes or repairs required by
Tenant. Two keys will be furnished by Landlord for the Premises, and any
additional keys required by Tenant must be obtained from Landlord at a
reasonable cost to be established by Landlord.

         

        2. All
doors opening to public corridors shall be kept closed at all times except for
normal ingress and egress to the Premises, unless electrical hold backs have
been installed.

         

        3.
Landlord reserves the right to close and keep locked all entrance and exit doors
of the Building during such hours as are customary for comparable buildings in
the vicinity of the Building. Tenant, its employees and agents must be sure that
the doors to the Building are securely closed and locked when leaving the
Premises if it is after the normal hours of business for the Building. Any
tenant, its employees, agents or any other persons entering or leaving the
Building at any time when it is so locked, or any time when it is considered to
be after normal business hours for the Building, may be required to sign the
Building register when so doing. Access to the Building may be refused unless
the person seeking access has proper identification or has a previously arranged
pass for access to the Building. The Landlord and his agents shall in no case be
liable for damages for any error with regard to the admission to or exclusion
from the Building of any person. In case of invasion, mob, riot, public
excitement, or other commotion, Landlord reserves the right to prevent access to
the Building during the continuance of same by any means it deems appropriate
for the safety and protection of life and property.

         

        4.
Landlord shall have the right to prescribe the weight, size and position of all
safes and other heavy property brought into the Building. Safes and other heavy
objects shall, if considered necessary by Landlord, stand on supports of such
thickness as is necessary to properly distribute the weight. Landlord will not
be responsible for loss of or damage to any such safe or property in any case.
All damage done to any part of the Building, its contents, occupants or visitors
by moving or maintaining any such safe or other property shall be the sole
responsibility of Tenant and any expense of said damage or injury shall be borne
by Tenant.

         

        5. No
oversize or overweight furniture, freight, packages, supplies, equipment or
merchandise will be brought into or removed from the Building or carried up or
down in the elevators, except upon prior notice to Landlord, and in such manner,
in such specific elevator, and between such hours as shall be designated by
Landlord. Tenant shall provide Landlord with not less than 24 hours prior notice
of the need to utilize an elevator for any such purpose, so as to provide
Landlord with a reasonable period to schedule such use and to install such
padding or take such other actions or prescribe such procedures as are
appropriate to protect against damage to the elevators or other parts of the
Building.

         

        6.
Landlord shall have the right to control and operate the public portions of the
Building, the public facilities, the heating and air conditioning, and any other
facilities furnished for the common use of tenants, in such manner as is
customary for comparable buildings in the vicinity of the
Building.

        7. The
requirements of Tenant will be attended to only upon application at the
management office of the Building or at such office location designated by
Landlord. Employees of Landlord shall not perform any work or do anything
outside their regular duties unless under special instructions from
Landlord.

         

        8. Tenant
shall not disturb, solicit, or canvass any occupant of the Building and shall
cooperate with Landlord or Landlord's agents to prevent same.

         

        9. The
toilet rooms, urinals, wash bowls and other apparatus shall not be used for any
purpose other than that for which they were constructed, and no foreign
substance of any kind whatsoever shall be thrown therein. The expense of any
breakage, stoppage or damage resulting from the violation of this rule shall be
borne by the tenant who, or whose employees or agents, shall have caused
it.

         

        10.
Tenant shall not overload the floor of the Premises, nor mark, drive nails or
screws, or drill into the partitions, woodwork or plaster or in any way deface
the Premises or any part thereof without Landlord's consent first had and
obtained. Notwithstanding the foregoing, a tenant may decorate the interior of
such tenant's premises at such tenant's sole discretion provided such
decorations do not impact the structural integrity of the Building and cannot be
seen from the exterior of the Building or from any Common Areas of the
Building.

         

        11.
Except for vending machines intended for the sole use of Tenant's employees and
invitees, no vending machine or machines of any description other than
fractional horsepower office machines shall be installed, maintained or operated
upon the Premises without the written consent of Landlord.

         

        12.
Tenant shall not use any method of heating or air conditioning other than that
which may be supplied by Landlord, without the prior written consent of
Landlord.

         

        13.
Tenant shall not use or keep in or on the Premises or the Building any kerosene,
gasoline or other inflammable or combustible fluid or material. Tenant shall not
use, keep or permit to be used or kept, any foul or noxious gas or substance in
or on the Premises, or permit or allow the Premises to be occupied or used in a
manner offensive or objectionable to Landlord or other occupants of the Building
by reason of noise, odors, or vibrations, or interfere in any way with other
Tenants or those having business therein.

         

        14.
Tenant shall not bring into or keep within the Building or the Premises any
animals, birds, bicycles or other vehicles.

        
          
             

          

          
            D-1

            
              

            

          

          
             

          

        

        15. No
cooking shall be done or permitted by any tenant on the Premises, nor shall the
Premises be used for the storage of merchandise, for lodging or for any
improper, objectionable or immoral purposes. Notwithstanding the foregoing,
Underwriters' laboratory-approved equipment and microwave ovens may be used in
the Premises for heating food and brewing coffee, tea, hot chocolate and similar
beverages, provided that such use is in accordance with all applicable federal,
state and city laws, codes, ordinances, rules and regulations, and does not
cause odors which are objectionable to Landlord and other Tenants.

         

        16.
Landlord will approve where and how telephone and telegraph wires are to be
introduced to the Premises. No boring or cutting for wires shall be allowed
without the consent of Landlord. The location of telephone, call boxes and other
office equipment affixed to the Premises shall be subject to the approval of
Landlord.

         

        17.
Landlord reserves the right to exclude or expel from the Building any person
who, in the judgment of Landlord, is intoxicated or under the influence of
liquor or drugs, or who shall in any manner do any act in violation of any of
these Rules and Regulations.

         

        18.
Tenant, its employees and agents shall not loiter in the entrances or corridors,
nor in any way obstruct the sidewalks, lobby, halls, stairways or elevators, and
shall use the same only as a means of ingress and egress for the
Premises.

         

        19.
Tenant shall not waste electricity, water or air conditioning and agrees to
cooperate fully with Landlord to ensure the most effective operation of the
Building's heating and air conditioning system, and shall refrain from
attempting to adjust any controls.

         

        20.
Tenant shall store all its trash and garbage within the interior of the
Premises. No material shall be placed in the trash boxes or receptacles if such
material is of such nature that it may not be disposed of in the ordinary and
customary manner of removing and disposing of trash and garbage in the city in
which the Building is located without violation of any law or ordinance
governing such disposal. All trash, garbage and refuse disposal shall be made
only through entry-ways and elevators provided for such purposes at such times
as Landlord shall designate.

         

        21.
Tenant shall comply with all safety, fire protection and evacuation procedures
and regulations established by Landlord or any governmental agency.

         

        22.
Tenant shall assume any and all responsibility for protecting the Premises from
theft, robbery and pilferage, which includes keeping doors locked and other
means of entry to the Premises closed, when the Premises are not
occupied.

         

        23. No
awnings or other projection shall be attached to the outside walls of the
Building without the prior written consent of Landlord. No curtains, blinds,
shades or screens shall be attached to or hung in, or used in connection with,
any window or door of the Premises without the prior written consent of
Landlord. The sashes, sash doors, skylights, windows, and doors that reflect or
admit light and air into the halls, passageways or other public places in the
Building shall not be covered or obstructed by Tenant, nor shall any bottles,
parcels or other articles be placed on the windowsills. All electrical ceiling
fixtures hung in offices or spaces along the perimeter of the Building must be
fluorescent and/or of a quality, type, design and bulb color approved by
Landlord.

        24. The
washing and/or detailing of or, the installation of windshields, radios,
telephones in or general work on, automobiles shall not be allowed on the Real
Property.

         

        25. Food
vendors shall be allowed in the Building upon receipt of a written request from
the Tenant. The food vendor shall service only the tenants that have a written
request on file in the Building's management office. Under no circumstance shall
the food vendor display their products in a public or common area including
corridors and elevator lobbies. Any failure to comply with this rule shall
result in immediate permanent withdrawal of the vendor from the
Building.

         

        26.
Tenant must comply with requests by the Landlord concerning the informing of
their employees of items of importance to the Landlord.

         

        27.
Tenant shall comply with any non-smoking ordinance adopted by any applicable
governmental authority.

         

        28.
Landlord may waive any one or more of these Rules and Regulations for the
benefit of any particular tenant or tenants, but no such waiver by Landlord
shall be construed as a waiver of such Rules and Regulations in favor of any
other tenant or tenants, nor prevent Landlord from thereafter enforcing any such
Rules or Regulations against any or all tenants of the Building. Landlord
reserves the right at any time to change or rescind any one or more of these
Rules and Regulations, or to make such other and further reasonable Rules and
Regulations as in Landlord's judgment may from time to time be necessary for the
management, safety, care and cleanliness of the Premises and Building, and for
the preservation of good order therein, as well as for the convenience of other
occupants and tenants therein. Landlord shall not be responsible to Tenant or to
any other person for the nonobservance of the Rules and Regulations by another
tenant or other person. Tenant shall be deemed to have read these Rules and
Regulations and to have agreed to abide by them as a condition of its occupancy
of the Premises.

         

        PARKING
RULES AND REGULATIONS

         

        1. Tenant
and employees of Tenant (hereinafter referred to as "Tenant") shall not park
vehicles in any parking areas designated by Landlord as areas for parking by
visitors to the Building. Tenant shall not leave vehicles in the Building
parking areas overnight nor park any vehicles in the Building parking areas
other than automobiles, motorcycles, motor driven or non-motor drive bicycles or
four-wheeled trucks. Landlord may, in its sole discretion, designate separate
areas for bicycles and motorcycles.

        2. Cars
must be parked entirely within the stall lines painted on the floor of the
parking areas.

         

        3. All
directional signs and arrows must be observed.

        

          
            
               

            

            
              D-2

              
                

              

            

            
               

            

          

        

         

        4. The
speed limit shall be 5 miles per hour.

         

        5.
Parking is prohibited, unless a floor parking attendant approved by Landlord
directs otherwise:

         

        a. In
areas not striped for parking;

         

        b. In
aisles;

         

        c. Where
"No Parking" or "Handicap" signs are posted;

         

        d. On
ramps;

         

        e. In
crosshatched areas; or

         

        f. In
such other areas as may be designated by Landlord or its authorized
agents.

         

        6.
Parking stickers or any other device or form of identification which may be
supplied by Landlord shall remain the property of Landlord. Such parking
identification device must be displayed as requested and may not be mutilated in
any manner.

         

        7. Every
Tenant is requested to park and lock his/her own car. All responsibility for
damage to cars to be repaired is hereby assumed by Tenant. Tenant shall repair
or cause to be repaired at its sole cost and expense any and all damage to the
Building Parking Facility or any part thereof caused by Tenant or any of
Tenant's Representatives or resulting from vehicles of Tenant or any of Tenant's
Representatives.

         

        8. Loss
or theft of parking identification devices from automobiles must be reported to
Landlord immediately. Any parking identification devices found on any
unauthorized car will be confiscated and the illegal holder will be subject to
prosecution. Lost or stolen devices previously reported and then found must be
reported found to the Landlord immediately.

         

        9. Spaces
are for the express purpose of one automobile per space unless approved by
Landlord or Landlord directs otherwise. Washing, waxing, cleaning or servicing
of any vehicle by Tenant and/or any of Tenant's Representatives is prohibited.
Storage of vehicles for periods exceeding one week is prohibited and said
vehicles shall be subject to towing.

         

        10. The
Landlord reserves the right to refuse the issuance of monthly stickers or other
parking identification devices to any Tenant or person and/or his agents or
representatives who willfully refuse to comply with the above Rules and
Regulations or any city, state or federal ordinance, rule, regulation, law or
agreement. Tenant shall not load or unload in areas other than those designated
by Landlord for such activities.

         

        11. Tenants and any of Tenant's Representatives parked in prohibited
areas are subject to towing at their own expense.

        
          
            
               

            

            
              D-3

              
                

              

            

            
               

            

          

        

        

        EXHIBIT
E

        FORM
OF TENANT'S ESTOPPEL CERTIFICATE

         

        The
undersigned, as Tenant under that certain Office Lease (the "Lease") made and
entered into as of November 2, 2000 and between LINCOLN-RECP EMPIRE OPCO, LLC, a
Delaware limited liability company, as Landlord, and the undersigned as Tenant,
for Premises on the first (1st) and second (2nd) floor(s) of the Building
located at 1301 Harbor Bay Parkway, Alameda, California hereby certifies as
follows:

         

        1.
Attached hereto as Exhibit A is a true and correct copy of the Lease and all
amendments and modifications thereto. The documents contained in Exhibit A
represent the entire agreement between the parties as to the
Premises.

         

        2. The
undersigned has commenced occupancy of the Premises described in the Lease,
currently occupies the Premises, and the Lease Term commenced on
_________.

         

        3. The
Lease is in full force and effect and has not been modified, supplemented or
amended in any way except as provided in Exhibit A.

         

        4. Tenant
has not transferred, assigned, or sublet any portion of the Premises nor entered
into any license or concession agreements with respect thereto except as
follows:

         

        5. Tenant
shall not modify the documents contained in Exhibit A or prepay any amounts
owing under the Lease to Landlord in excess of thirty (30) days without the
prior written consent of Landlord's mortgagee.

         

        6. Base
Rent became payable on _______________.

         

        7. The
Lease Term expires on _________________.

         

        8. All
conditions of the Lease to be performed by Landlord necessary to the
enforceability of the Lease have been satisfied and Landlord is not in default
thereunder.

         

        9. No
rental has been paid in advance and no security has been deposited with Landlord
except as provided in the Lease. Tenant has no options to renew or otherwise
extend the term of the Lease nor any right or option to purchase all or any
portion of the Premises, except as follows:

         

        10. As of
the date hereof, there are no existing defenses or offsets that the undersigned
has, which preclude enforcement of the Lease by Landlord.

         

        11. All
monthly installments of Base Rent, all Additional Rent and all monthly
installments of estimated Additional Rent have been paid when due through
_________________. The current monthly installment of Base Rent is
$__________.

         

        12. The
undersigned acknowledges that this Estoppel certificate may be delivered to
Landlord's prospective mortgagee, or a prospective purchaser, and acknowledges
that it recognizes that if same is done, said mortgagee, prospective mortgagee,
or prospective purchaser will be relying upon the statements contained herein in
making the loan or acquiring the property of which the Premises are a part, and
in accepting an assignment of the Lease as collateral security, and that receipt
by it of this certificate is a condition of making of the loan or acquisition of
such property.

         

        13. If
Tenant is a corporation, limited liability company or partnership, each
individual executing this Estoppel Certificate on behalf of Tenant hereby
represents and warrants that Tenant is a duly formed and existing entity
qualified to do business in the state in which the Building is located and that
Tenant has full right and authority to execute and deliver this Estoppel
Certificate and that each person signing on behalf of Tenant is authorized to do
so.

         

        Executed
at __________________ on the _____ day of ______________, 20___.

         

        TENANT:

         

        AVIGEN,
INC.,

        a
Delaware corporation

        

        
          	
                  By:

                	 
      
	
                  Its:

                	 
      
	
                  Date:

                	 
      
	 
      	 
      
	
                  By:

                	 
      
	
                  Its:

                	 
      
	
                  Date:

                	 
      

        

         

        
          
             

          

          
            E-1

            
              

            

          

          
             

          

        

         

        EXHIBIT 10.46

         

        FIRST
AMENDMENT TO LEASE AGREEMENT

         

        This
First Amendment to Lease Agreement (the "Amendment") is made and entered into as
of December 1, 2000, by and between LINCOLN-RECP EMPIRE OPCO, LLC, a California
limited liability company ("Landlord") and AVIGEN, INC., a Delaware corporation
("Tenant"), with reference to the following facts.

         

        RECITALS

         

        A.
Landlord and Tenant have entered into that certain Lease Agreement dated as of
November 2, 2000 (the "Lease") for the leasing of certain premises consisting of
approximately 67,482 rentable square feet located at 1301 Harbor Bay Parkway,
Alameda, California (the "Premises") as such Premises are more fully described
in the Lease, for a term commencing on December 1, 2000, and expiring on
November 30, 2010.

         

        B.
Pursuant to Article 2 of the Lease, the Premises on the second floor of the
Building comprising approximately 32,945 rentable square feet (the "Remaining
Premises") was anticipated to be delivered to Tenant on or about October 1, 2001
(the "RP Commencement Date").

         

        C. Tenant
now wishes to, effective as of December 1, 2000, occupy approximately 22,945
rentable square feet of the Remaining Premises (the "A Remaining Premises"),
rather than waiting until the RP Commencement Date to occupy any of the
Remaining Premises, and wishes to occupy the entire Remaining Premises as of
March 1, 2001, rather than the RP Commencement Date, and Landlord is agreeable
to the same.

         

        D.
Phoenix American, Inc., a California corporation, successor in interest to
Resource/Phoenix, Inc. ("Phoenix") currently occupies the balance of the
Remaining Premises (the "B Remaining Premises") comprising approximately 10,000
rentable square feet pursuant to a lease from Landlord.

         

        E.
Landlord and Tenant now wish to amend the Lease upon and subject to each of the
terms, conditions and provisions set forth herein.

         

        NOW,
THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged,
Landlord and Tenant agree as follows:

         

        1.
RECITALS: Landlord and Tenant agree that the above recitals are true and correct
and are hereby incorporated herein as though set forth in full.

         

        2.
MODIFICATIONS TO LEASE: Effective as of December 1, 2000 (the "Effective Date"),
the Lease is hereby modified as follows:

         

        2.1
PREMISES. ARTICLE 2 - LEASE TERM of the Lease is hereby amended such that the
fifth (5th) and sixth (6th) sentences thereof shall read as
follows:

        "Landlord
has delivered, and Tenant acknowledges having possession of, approximately
34,537 rentable square feet of the Premises on the ground floor of the Building
(the "Initial Premises") to Tenant on or about the Lease Commencement Date; and
Landlord anticipates delivering the balance of the Premises on the second floor
of the Building comprising approximately 32,945 rentable square feet (the
"Remaining Premises"), approximately 22,945 rentable square feet (the "A
Remaining Premises"), as shown on Exhibit A to this Amendment, is anticipated to
be delivered to Tenant on or about December 1, 2000 (the "RPA Commencement
Date"); and approximately 10,000 rentable square feet (the "B Remaining
Premises"), as shown on Exhibit A to this Amendment, is anticipated to be
delivered to Tenant on or about March 1, 2001 (the "RPB Commencement Date"). If
Landlord, for any reason, cannot deliver possession of the A Remaining Premises
to Tenant on the RPA Commencement Date (in the condition that exists on the day
after the Existing Tenant vacates the A Remaining Premises), or cannot deliver
possession of the B Remaining Premises to Tenant on the RPB Commencement Date
(in the condition that exists on the day after the Existing Tenant vacates the B
Remaining Premises), in either case without any improvements, alterations,
repairs, refurbishment or other modifications being made thereto (except as may
be necessary to satisfy the requirements of Section 1.2 above), Landlord shall
not be subject to any liability nor shall the validity of this Lease be
affected; provided that the RPA Commencement Date and/or the RPB Commencement
Date, as appropriate, shall be extended commensurately by the period of time
Landlord is delayed in so delivering possession of the A Remaining Premises
and/or the B Remaining Premises to Tenant without any improvements, alterations,
repairs, refurbishment or other modifications being made thereto. Tenant's
rights to use the A Remaining Premises and the B Remaining Premises shall be
subject and subordinate to the rights of Phoenix; and no use by Tenant may
unreasonably interfere with the rights of Phoenix to use and occupancy of
Phoenix's premises."

         

        Throughout
the Lease, references to the "RP Commencement Date" shall be deemed to be
references to the "RPA Commencement Date" and/or the "RPB Commencement Date", as
appropriate.

         

        2.2
RENT.

         

        ARTICLE 3
- BASE RENT of the Lease is hereby amended as follows:

         

        Base Rent
for the A Remaining Premises is waived by the Landlord for the period from the
RPA Commencement Date through the RPB Commencement Date. From and after the RPB
Commencement Date, Tenant shall pay to Landlord Base Rent for both the RPA
Remaining Premises and the RPB Remaining Premises at the monthly rate of $1.52
per rentable square foot, or Fifty Thousand Seventy-six Dollars and Forty Cents
($50,076.40), through May 31, 2002; and thereafter Tenant shall pay to Landlord
Base Rent for both the RPA Remaining Premises and the RPB Remaining Premises at
the monthly rate of $1.59 per rentable square foot, or Fifty-two Thousand Three
Hundred Eighty-two Dollars and Fifty-five Cents ($52,382.55).

        
          
             

          

          
            E-2

            
              

            

          

          
             

          

        

        The
second table set forth in Section 8. Base Rent (Article 3) of the Summary of
Basic Lease Information in the Lease (for Base Rent for the "Remaining Premises"
from the "RP Commencement Date" through December 31, 2002), is hereby revised in
accordance with the following schedule:

        

        
          	
                  TERM

                	 	
                  REMAINING

                  PREMISES
      SQUARE

                  FEET

                	 	 	
                  REMAINING
      PREMISES

                  ANNUAL
      RENTAL

                  RATE
      PER

                  RENTABLE
      SQUARE FOOT

                	 	 	
                  MONTHLY

                  INSTALLMENT

                  OF
      BASE RENT

                	 
	 
      	 	 	 	 	 	 	 	 	 
	
                  3/1/01
      - 5/31/02

                	 	 	32,945	 	 	$	18.24	 	 	$	50,076.40	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                  6/1/02
      - 12/31/02

                	 	 	32,945	 	 	$	19.08	 	 	$	52,382.55	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 

        

        

        2.3
LETTER OF CREDIT.

         

        Paragraph
20.2 LETTER OF CREDIT of the Lease is hereby amended as follows:

         

        Upon the
RPB Commencement Date, the face amount of the Letter of Credit shall be
increased to be Two Million Dollars ($2,000,000.00).

         

        3. EFFECT
OF AMENDMENT: Except as modified herein, the terms and conditions of the Lease
shall remain unmodified and continue in full force and effect. In the event of
any conflict between the terms and conditions of the Lease and this Amendment,
the terms and conditions of this Amendment shall prevail. Tenant hereby renews
its obligations to Landlord for the full, prompt and timely payment of all rents
and other sums required to be paid by Tenant during the term of the Lease as
herein modified, and for the full, prompt and timely performance of, compliance
with and observation of all the terms contained in the Lease as herein
modified.

        4.
DEFINITIONS: Unless otherwise defined in this Amendment, all terms not defined
in this Amendment shall have the meaning set forth in the Lease.

         

        5. NO
BROKER: Each party warrants and represents to the other that no real estate
broker, sales person, finder or other person has the right to payment of a
commission or fee in connection with this Amendment as a consequence of contacts
with such party. Each party shall indemnify, protect, defend and hold the other
harmless from any and all loss, cost, damage or expense (including attorneys'
fees and costs, including fees and costs on appeal, if any) arising out of or
related to claims for a real estate brokerage commission, finder's fee or
similar compensation, based upon allegations by the claimant that it is entitled
to a commission, fee or other compensation from the indemnified party as a
consequence of contacts with the indemnifying party.

         

        6. ENTIRE
AGREEMENT: The Lease and this Amendment constitute the entire understanding
between the parties with respect to the Premises. No subsequent amendment will
be effective unless it is in writing and executed by the parties.

         

        7.
COUNTERPARTS: This Amendment may be executed in counterparts, each of which when
executed and delivered shall be an original.

         

        8.
AUTHORITY: Subject to the provisions of the Lease, this Amendment shall be
binding upon and inure to the benefit of the parties hereto, their respective
heirs, legal representatives, successors and assigns. Each party hereto and the
persons signing below warrant that the person signing below on such party's
behalf is authorized to do so and to bind such party to the terms of this
Amendment.

         

        IN
WITNESS WHEREOF, the parties have executed this Amendment as of the date and
year first above written.

         

        TENANT:

         

        AVIGEN,
INC.,

        a
Delaware corporation

        

        
          	
                  Date:  

                	 12/13/00	 	
                  By:

                	
                  /s/ JOHN MONAHAN

                
	 
      	 	 	
                  Name:

                	
                  John Monahan

                
	 
      	 	 	
                  Title:

                	
                  CEO

                
	 
      	 	 	 
      	 
      
	
                  Date:

                	 	 	
                  By:

                	
                  /s/ THOMAS J. PAULSON

                
	 
      	 	 	
                  Name:

                	
                  Thomas J. Paulson

                
	 
      	 	 	
                  Title:

                	
                  VP-Finance,
CFO

                

        

         

        
          
             

          

          
            E-3

            
              

            

          

          
             

          

        

        LANDLORD:

         

        LINCOLN-RECP
EMPIRE OPCO, LLC,

        a
California limited liability company

         

        By:
Legacy Partners Commercial, Inc.,

        as
agent for LINCOLN-RECP EMPIRE OPCO, LLC,

         

        
          	
                  Date:

                	 
      	 	
                  By:

                	
                  /s/ ROBERT F. PHIPPS

                
	 
      	 	
                  Name:

                	
                  Robert F. Phipps

                
	 
      	 	
                  Title:

                	
                  Senior Vice
  President

                

        

        

          
            
               

            

            
              E-4

              
                

              

            

            
               

            

          

        

         

      

      Exhibit 
B

       

      Sublease
Premises and Sublease Common Areas

       

      
        
           

        

        
          B-1

          
            

          

        

        
           

        

      

      Exhibit 
C

       

      Furniture
and Equipment

       

       D-1exv10w9xay

 

Exhibit 10.9A

FIRST AMENDMENT TO

DIRECTORY SERVICES AGREEMENT

DATED APRIL 27TH, 2007

BETWEEN YELLOW BOOK USA INC., AND INTELIUS SALES COMPANY LLC.

Yellow Book USA Inc. (“Yellow Book”), Intelius Sales Company LLC (“Intelius”) are parties to
an Directory Services Agreement dated April 27, 2007, (“Agreement”). The parties enter into
this First Amendment (“Amendment One”) to the Agreement as of 20 February, 2008, to modify
the Agreement as follows:

	1.	 	Term of Agreement
	 
	 	 	 	The Agreement shall be extend [ * * * ], expiring on [ * * * ].

	 
	2.	 	Section 2b of Agreement will be replaced with the following:
	 
	 	 	 	Parties agree that the [ * * * ].

	 
	 	 	 	Parties agree
that Intelius will be [ * * * ].

	 
	3.	 	New Definition of “Query”

“Query” means [ * * * ]. Queries will comply with the traffic measurement
standards set by the IFABC www standards group and shall not include any
queries from Non-Covered Intelius Websites or any queries which result from
“robots,” “spiders,” “web crawlers” or other automated processed, devices,
programs, algorithms or methodologies. Yellow Book reserves the right to
audit such traffic periodically to ensure it comports with the agreed
standards.

	4.	 	All other provisions of the Agreement not modified by this Amendment One shall
remain in full force and effect.

	 	 	 	 	 	 	 	 
	Yellow Book USA, Inc.	 	Intelius Sales Company, LLC
	 
	 	 	 	 	 	 	 
	By:

	 	Patrick J. Marshall
	 	By:
	 	/s/ Ed Petersen	 
	 

	 	 	 	 	 	 	 
	Title:

	 	Chief New Media Officer
	 	Title:
	 	EVP Sales & Marketing	 
	Date:

	 	20 February 2008
	 	Date:
	 	2/29/08

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