Document:

Exhibit 10.42

 

PURCHASE, SALE AND LEASEBACK AGREEMENT

 

Flextronics
International USA, Inc., a California corporation (“Seller”), agrees to
sell and convey to Westcore Properties AC, LLC, a Delaware limited liability
company (“Purchaser”), and Purchaser agrees to buy, upon the terms and
conditions hereof, that certain tract of land consisting of approximately 37.048
acres, now known as and numbered 600, 620, 640, and 780 Shiloh Road, Plano,
Texas (the “Land”), as more particularly described on Exhibit A
attached hereto and made a part hereof, along with all rights, privileges, and
appurtenances relating or pertaining thereto, including, without limitation,
the following:

 

a.                                       Any
buildings, fixtures, equipment and other improvements situated on, over and/or
under the Land (collectively, the “Improvements”);

 

b.                                      All
and singular the rights and appurtenances pertaining to the Land and/or the
Improvements, including, without limitation, all right, title and interest of
Seller in and to adjacent streets, roads, alleys, easements and rights-of-way,
water rights, air rights, mineral rights, development rights and all awards
made or to be made in connection therewith (collectively, the “Appurtenances”);

 

c.                                       All
personal property (“Personal Property”) owned by Seller (if any) located
in or about the Land and Improvements and not utilized by Seller in its
operation of its business but rather utilized for purposes of operating and
maintaining the Property (as hereinafter defined), specifically excluding the
Personal Property set forth on Exhibit G attached hereto and made a part
hereof; and

 

d.                                      To
the extent they are transferable, all certificates, licenses, permits,
authorizations, approvals, no action letters and similar assurances (including,
without limitation, all environmental permits, zoning variances, plat
approvals, site plan approvals, development permits and/or building permits)
granted or issued by a private person or by any governmental or
quasi-governmental authority and which relate to the Land and/or Improvements
and all other intangible property and tradenames which relate to the Land
and/or Improvements (collectively, the “Intangible Property” and,
together with the Land, Improvements, Appurtenances and Personal Property,
collectively, the “Property”).

 

1.                                      Leaseback.
At Closing (as hereinafter defined), Seller, as tenant, and Purchaser, as
landlord, shall enter into a lease of portions of the Property substantially in
the form of Exhibit B attached hereto and made a part hereof (the “Lease”),
whereby Seller shall lease back the Land, Personal Property and Improvements,
other than the building commonly known as 780 Shiloh Road (the “780 Building”),
from Purchaser upon the terms and conditions set forth in the Lease. Notwithstanding
anything to the contrary contained herein, the form and content of the Lease
may be revised by Purchaser during the Review Period to incorporate those
changes necessitated by Texas law to cause the provisions thereof to be fully
enforceable under Texas law; any such revisions to the Lease being subject to
Seller’s reasonable approval thereof. All of Seller’s obligations hereunder
shall be subject to the condition that, on or before Closing, Purchaser shall
have executed and delivered to Escrow Agent (as hereinafter defined) duly
signed originals of the Lease. All of Purchaser’s obligations hereunder shall
be subject to the condition that, on or before Closing, Seller shall have
executed and delivered to Escrow Agent duly signed originals of the Lease.

 

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2.                                      Purchase
Price and Escrow Deposit. The total purchase price for the Property
shall be Thirty-Seven Million Dollars ($37,000,000.00) (the “Purchase Price”).
The sum of $250,000.00 (the “Escrow Deposit”) shall be deposited by
Purchaser one (1) business day after the full execution of this Agreement by
Seller and Purchaser, with Chicago Title Insurance Company, 2001 Bryan Street,
Suite 1700, Dallas, TX 75201-3005, Attn: Joycelyn Armstrong (the “Title
Company” or “Escrow Agent”). The balance of the Purchase Price
remaining after deduction of the Escrow Deposit and after taking into account
the adjustments and prorations provided for herein, shall be paid by federal
funds wire transfer by Purchaser to the Escrow Agent on or before the Closing. Upon
the earlier to occur of (A) one (1) business day following the expiration of
the Review Period (as hereinafter defined), or (B) Purchaser’s waiver of the
right to terminate this Agreement during the Review Period (such earlier date
being hereinafter referred to as the “Contingency Expiration Date”), the
Escrow Deposit shall be deemed non-refundable, but shall be applicable to the
Purchase Price at Closing. The Title Company shall deposit the Escrow Deposit
in one or more interest bearing accounts with a bank or other financial
institution reasonably acceptable to Purchaser and Seller. Interest earned on
the Escrow Deposit shall be deemed a portion of the Escrow Deposit. The Escrow
Deposit shall be applied toward the payment of the Purchase Price at the
Closing, or otherwise disbursed in accordance with this Agreement.

 

3.                                      Title
Report; Survey; Additional Information.

 

a.                                       Purchaser
may, at its option, obtain (i) a current report of the title to the Property
(the “Title Report”), and/or (ii) a survey and field note legal
description of the Property (the “Survey”).

 

b.                                      Seller
shall furnish to Purchaser, within five (5) business days after the Effective
Date, all of the materials specified on Exhibit C attached hereto
(collectively, the “Due Diligence Materials”) (provided such items are
in Seller’s or Seller’s property manager’s possession or control).

 

Purchaser
acknowledges and agrees that Seller has not verified and shall not verify the
accuracy, completeness or any other aspect of the Due Diligence Materials, the
Title Report, or the Survey. Seller shall make the Due Diligence Materials
available to Purchaser solely as an accommodation to Purchaser, without
representation or warranty of any kind or nature.

 

c.                                       Purchaser
shall have thirty (30) days from the Effective Date (as hereinafter defined) to
object in writing to any title exceptions (the “Title Objections”) shown
on the Title Report and/or the Survey by giving written notice to Seller;
provided that matters not objected to in writing by Purchaser within such
30-day period shall be deemed to be acceptable to Purchaser and to be permitted
exceptions. Seller shall have a period of five (5) business days after Seller’s
receipt of the Purchaser’s title objection notice (i) to remove, or agree
to remove prior to the Closing, some or all of the Title Objections and to
inform Purchaser of the same, or (ii) to advise Purchaser, in writing,
that Seller will not agree to remove some or all of the Title Objections (the “Title
Response Notice”). If Seller fails to timely deliver to Purchaser the Title
Response Notice, it shall be conclusively deemed that Seller has elected not to
remove any of the Title Objections. The Review Period shall be automatically
extended for up to five (5) business days following the earlier of Purchaser’s
receipt of the Title Response Notice or Seller’s deemed election to not remove
any of the Title Objections. If Seller advises Purchaser in its Title Response
Notice that it will not remove nor agree to remove some or all of the Title Objections
(or Seller is deemed to have so advised Purchaser), then Purchaser shall have
until 5:00 p.m. (Pacific Time) on the last day of the Review Period to advise
Seller, in writing, whether Purchaser elects to waive such objections and
proceed with the

 

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acquisition of the Property
without adjustment of the Purchase Price or to terminate this Agreement. If
Purchaser terminates this Agreement pursuant to this Section 3, Purchaser shall
be entitled to the return of the Escrow Deposit. Failure by Seller to remove
(or to inform Purchaser that Seller has or has not removed) those specified
exceptions which Seller has agreed to remove in the Title Response Notice on or
before the fifth (5th) business day prior to the Closing Date shall not be
deemed a default on the part of Seller, but Purchaser shall have the right
either (x) to withdraw its objections in writing and proceed with Closing
without any adjustment to the Purchase Price, or (y) to terminate this Agreement
and be entitled to the return of the Escrow Deposit. Notwithstanding anything
herein to the contrary, by the Closing Date, Seller shall remove or cause to be
removed all voluntary monetary liens or encumbrances affecting the Property
other than current taxes and assessments not yet due and payable. Any
exceptions to title that are either accepted or waived by Purchaser hereunder
shall be referred to as “Permitted Exceptions.”

 

d.                                      Seller
and Purchaser each acknowledge and agree that some of the access, utilities and
other infrastructure servicing the Property may be shared with adjacent
property owned by Seller, and that easements and/or reciprocal easements may be
necessary in order to allow the continued post-Closing shared use of such
infrastructure. During the Review Period (as hereinafter defined), Seller and
Purchaser shall mutually determine in good faith whether any such easements are
in fact necessary. If any such easements are so determined to be necessary, at
Closing Seller and Purchaser shall execute appropriate easement agreements, in
form and substance reasonably satisfactory to both parties.

 

e.                                       Seller
and Purchaser each acknowledge and agree that the size of the Land and the four
(4) buildings located on the Land are presently estimated to be the number of
acres (for the Land) and square feet (for the buildings) as specified in this
Agreement and in the draft of the Lease attached hereto. During the Review
Period, Purchaser shall measure the size of the Land and the four (4) buildings
and if the results of such measurements differ substantially from what is
specified in this Agreement and/or the Lease, Purchaser shall have the right to
terminate this Agreement during the Review Period, in which event the Escrow
Deposit shall be immediately returned to Purchaser without the necessity of
Seller signing any instructions.

 

f.                                         It
is the intention of the parties hereto that the adjacent parcels of land
referred to as the “excess land/parcels” are not included in the definition of
the Land. Accordingly, during the Review Period, Seller and Purchaser shall
cooperate and work together in good faith to promptly confirm that the legal
description of the Land as described in Exhibit A hereto does not
include such “excess land/parcels.”  If
the legal description attached hereto as Exhibit A is determined to be
incorrect, Seller shall immediately substitute the correct legal description as
Exhibit A in lieu of the exhibit attached hereto. Seller shall
expeditiously confirm the accuracy of said legal description of the Land, but
in no event later than ten (10) business days after the Effective Date hereof.

 

4.                                      Closing;
Closing Documents.

 

a.                                       The
Closing of this transaction (the “Closing”) shall mean the date that the
Special Warranty Deed (as hereinafter defined) is recorded in the official
records of Collin County, Texas and possession of the Property is delivered to
Purchaser. Unless otherwise agreed to in writing by the parties, escrow shall
close on or before December 22, 2006 (the “Closing Date”). Upon execution
of this Agreement, the parties hereto shall deposit a copy of an executed
counterpart of this Agreement with Escrow Agent and this instrument shall serve
as the instructions to Escrow Agent for the purchase and sale

 

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contemplated hereby. Seller and
Purchaser agree to execute such additional and supplementary escrow
instructions as appropriate to enable the Escrow Agent to comply with the terms
of this Agreement; provided, however, that in the event of any
conflict between this Agreement and any supplementary escrow instructions, this
Agreement shall control.

 

b.                                      Possession
of the Property shall be delivered to Purchaser at Closing free and clear of
any and all liens, restrictions or other encumbrances other than the Lease and
the Permitted Exceptions, as provided above. Notwithstanding the foregoing,
Seller may have an additional period of time pursuant to a license agreement
between the parties (the form and content of which will be negotiated and finalized
during the Review Period), not to exceed sixty (60) days after the Closing, in
which to remove its personal property from the 780 Building, and upon such
removal the 780 Building shall be delivered by Seller to Purchaser in broom
clean condition and state of repair, and otherwise in the condition required
under Subsection 8.c.(2) hereof. Seller agrees to deliver at Closing, the
following:  (i) a duly executed
special warranty deed conveying the Property to Purchaser in the form attached
hereto as Exhibit B (the “Special Warranty Deed”);
(ii) evidence of Seller’s authority to consummate the contemplated
transaction reasonably satisfactory to the Title Company and Purchaser;
(iii) a non-foreign certificate satisfactory for compliance with Internal
Revenue Service reporting purposes and any similar forms required by the State
of Texas; (iv) an affidavit in form reasonably and customarily required by the
Title Company sufficient for the Title Company to issue to Purchaser a TLTA
Owner’s Policy of Title Insurance on the Property in the amount of the Purchase
Price (the “TLTA Title Policy”); (v) the duly executed Lease; (vi) two
(2) original counterparts of a general assignment, in the form attached hereto
as Exhibit E for the Licenses, Permits and Warranties, duly executed by
Seller; (vii) two (2) originals of a bill of sale, in the form attached hereto
as Exhibit F, transferring the Personal Property to Purchaser, duly
executed by Seller; (viii) an amount equal to the base rent (the “Rent
Payment”) coming due under the Lease for the first full month of the Lease
term, plus the pro-rated amount of any Rent Payment due for any partial
month of the Lease term commencing at Closing; (ix) two (2) originals of a
license agreement for Seller’s access and use of the 780 Building for a 60-day
period after the Closing (the “License Agreement”); and (x) any other
documents as may be necessary to comply with Seller’s obligations under this
Agreement.

 

c.                                       At
Closing, the Purchase Price shall be paid by Purchaser to Seller by federal
funds wire transfer or other funds acceptable to Seller, subject to adjustments
under Section 6 hereof. At Closing, Purchaser agrees to deliver to Seller a
duly executed original of the Lease together with any notice or memorandum of
lease required thereby, and any other documents as may be necessary to comply
with Purchaser’s obligations under this Agreement.

 

5.                                      Liquidated
Damages.

 

a.             SHOULD PURCHASER DEFAULT IN ITS
MATERIAL OBLIGATIONS UNDER THIS AGREEMENT, SELLER SHALL HAVE THE RIGHT TO TERMINATE
THIS AGREEMENT UPON WRITTEN NOTICE TO ESCROW AGENT AND TO RECEIVE THE ESCROW
DEPOSIT THERETOFORE PAID BY PURCHASER UNDER THIS AGREEMENT WHICH AMOUNT IS NOT
INTENDED TO BE A FORFEITURE OR PENALTY, BUT IS INTENDED TO CONSTITUTE
LIQUIDATED DAMAGES TO SELLER, AND SUCH SUM SHALL BE PAID TO AND RETAINED BY
SELLER AS SELLER’S SOLE AND EXCLUSIVE REMEDY AGAINST PURCHASER, AT LAW OR IN
EQUITY; PROVIDED HOWEVER, THAT THE REMEDY OF LIQUIDATED DAMAGES SET FORTH IN
THIS SECTION SHALL NOT LIMIT,

 

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AND
SHALL NOT BE DEEMED TO LIMIT, IN ANY WAY THE REMEDIES AVAILABLE TO SELLER UNDER
SECTIONS 8.a AND 14 OF THIS AGREEMENT, AND/OR SELLER’S RIGHT TO RECOVER ACTUAL
DAMAGES FOR PURCHASER’S BREACH OF ANY OF THE WARRANTIES AND REPRESENTATIONS OF
PURCHASER CONTAINED IN THIS AGREEMENT, PROVIDED THAT SUCH BREACH IS DISCOVERED
BY SELLER FOLLOWING DELIVERY OF THE DEED AND AS A RESULT OF SUCH BREACH SELLER
IS REQUIRED TO RETURN ALL OR ANY PORTION OF THE PURCHASE PRICE TO A CLAIMANT. THE
PARTIES HAVE AGREED THAT SELLER’S ACTUAL DAMAGES, IN THE EVENT OF A MATERIAL
DEFAULT BY PURCHASER, WOULD BE EXTREMELY DIFFICULT OR IMPRACTICABLE TO
DETERMINE. THEREFORE, THE PARTIES ACKNOWLEDGE THAT THE ESCROW DEPOSIT HAS BEEN
AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES’ REASONABLE ESTIMATE OF SELLER’S
DAMAGES AND AS SELLER’S SOLE AND EXCLUSIVE REMEDY AGAINST PURCHASER, AT LAW OR
IN EQUITY, IN THE EVENT OF A MATERIAL DEFAULT UNDER THIS AGREEMENT ON THE PART
OF PURCHASER. SELLER AND PURCHASER ACKNOWLEDGE THAT THEY HAVE READ AND
UNDERSTAND THE PROVISIONS OF THIS SECTION AND BY THEIR INITIALS IMMEDIATELY
BELOW AGREE TO BE BOUND BY ITS TERMS.

 

	
  Seller’s
  Initials

  	
   

  	
  Purchaser’s
  Initials

  
	
   

  	
   

  	
   

  
	
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b.                                      Should
Seller default in its material obligations under this Agreement for any reason,
Purchaser, as its sole right and remedy at law or in equity, may either (i)
terminate this Agreement upon written notice to Seller, whereupon Purchaser
shall be entitled to receive an immediate return of the Escrow Deposit
theretofore paid under this Agreement, plus, within five (5) business days
after receipt of reasonable evidence verifying such costs, all of Purchaser’s
actual out of pocket costs incurred in connection with this transaction and
Purchaser’s due diligence with respect to the Property up to the maximum of
$100,000, or (ii) seek the remedy of specific performance against Seller.

 

c.                                       In
the event of any dispute or either party hereto defaults (or is alleged to have
defaulted) in the performance of any of the terms, covenants, agreements or
conditions contained in this Agreement, and the other party hereto places the
enforcement of this Agreement, or any part hereof, in the hands of attorneys,
or files suit upon the same, the non-prevailing party agrees to pay the
reasonable attorneys’ fees and all court costs of the prevailing party.

 

6.                                      Prorations;
Closing Costs. Any transfer, documentary, sales, use, registration,
value-added and real estate transfer taxes and any similar taxes, recording
fees, and related fees incurred in connection with this Agreement and the
transactions contemplated hereby and thereby shall be prorated in accordance
with county custom. Notwithstanding the preceding sentences, any real estate
taxes and assessments or other municipal charges due and payable as of the
Closing shall be paid in full at Closing by Seller, and all other such real
estate taxes, assessments, municipal charges, other recurring expenses normal
to the operation and maintenance of the Property and not payable by Seller as
the tenant under the Lease, and other items customarily adjusted between buyers
and sellers in the vicinity of the Property, shall be prorated as of the
Closing; provided, however, Seller shall be solely responsible
for the payment of all (a) water, sewer and utility charges and other recurring
expenses which are payable by Seller as the tenant under the Leases and (b) all
supplemental taxes levied, assessed or otherwise accrued which are

 

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applicable to any period of
time prior to the Closing Date. If the tax figures used for the closing
adjustments are based on estimated figures, the parties agree to make any
necessary adjustments between themselves when the actual figures for the year
of Closing are known. All agreements between Seller and Purchaser set forth in
this Agreement relating to the proration and payment of any items set forth in
this Section 6 and any subsequent adjustment of amounts for such items
following the Closing shall survive the Closing and shall not merge therein. Except
as is otherwise provided herein, each party shall pay its own attorneys’ fees,
and all other closing costs shall be allocated as is customary in the vicinity
of the Property. Seller shall pay 50% of all escrow costs and 100% of the title
insurance premiums for an owner’s standard form Texas Land Title Association
title insurance policy, issued by the Title Company in the amount of the
Purchase Price. Purchaser shall pay 50% of all escrow costs and 100% of the
costs of (i) any endorsements to such title insurance policy (excluding those
endorsements, if any, required by the Title Company to be obtained in order to
cause the removal from title of the Title Objections which Seller has agreed to
remove in accordance with the provisions of Section 3.c above, the cost of
which shall be paid by Seller) and/or any additional costs for an ALTA form
policy (if available), and (ii) the Title Report, the Survey, and any due
diligence performed by or at the request of Purchaser.

 

7.                                      Damage
and Condemnation. If, prior to the Closing, (i) the Property is
destroyed or damaged and such destruction or damage shall cost more than
$250,000.00 to repair, (ii) the Property becomes subject to a taking by virtue
of eminent domain, or (iii) any casualty or condemnation proceeding affecting
the Property would allow Seller, as tenant, to terminate any or all of the
Leases or abate rent as a result of such occurrence (unless Seller waives, in
writing, such right to abate rent), Purchaser may terminate this Agreement,
whereupon the Title Company shall return the Escrow Deposit to Purchaser
immediately. If any destruction or damage shall cost less than $250,000.00 to
repair, or if Purchaser otherwise does not elect to terminate this Agreement
hereunder, then Purchaser shall close on the purchase of the Property without
adjustment of the Purchase Price except as otherwise set forth in this Section
7, and Seller shall assign to Purchaser all interest of Seller in and to any
condemnation awards or insurance proceeds which may be payable to Seller on
account of such occurrence; provided that, if any such awards or proceeds are
actually paid prior to the Closing, Seller shall be entitled to retain such
awards or proceeds and Purchaser shall be entitled to a credit against the
Purchase Price in an amount equal to the amount of such awards or proceeds
retained by Seller up to the amount of the Purchase Price.

 

8.                                      Purchaser
Review Period and Termination Rights.

 

a.                                       Purchaser
shall have a period of time (the “Review Period”) consisting of the
period of time from and after the Effective Date through and including December
8, 2006 (until 5:00 p.m. Pacific Time on said date), in which to investigate
and review the status of the physical condition of the Property. Purchaser
shall have the right, upon at least 24 hours prior notice to Seller and at
reasonable times, to go on the Property and conduct all inspections, tests, and
other studies that Purchaser deems necessary or advisable; provided that all
such inspections shall be at Purchaser’s sole risk and expense and if the
Closing does not occur, the Property shall be restored substantially to its
present condition in the event of any damage caused by any such tests or
studies. Purchaser shall not materially disturb the ongoing activities of
Seller at the Property. All costs and expenses related to Purchaser’s
inspection of the Property shall be paid by Purchaser, and Purchaser agrees to
indemnify and hold Seller harmless from and against all such costs and expenses.
Purchaser shall not permit any liens to attach to the Property by the reason of
the exercise of Purchaser’s rights hereunder. Purchaser will indemnify and hold
Seller harmless from and against any and all liens by contractors,
subcontractors, materialmen or laborers performing work or tests

 

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for Purchaser, and from and
against any and all claims for all losses, costs and/or damages by Seller
and/or third parties arising out of the conduct of such work and tests and/or
any other activities of Purchaser or Purchaser’s employees or agents on the
Property; provided, however, any such indemnity and defense will
not include any claims or damages caused by the negligence or willful
misconduct of Seller, any pre-existing conditions, or the effects of the
discovery of the presence of any hazardous materials (provided that Purchaser
exercises due care upon the discovery of any hazardous materials and shall take
all commercially reasonable appropriate measures to prevent any migration of
such hazardous materials). Upon Seller’s written request and without any
warranty of any kind nor the ability of Seller to rely thereon or otherwise
re-use such materials, Purchaser shall make available to Seller copies of any
third party reports or studies prepared on behalf of Purchaser with respect to
its investigation of the Property. Prior to entering the Property, Purchaser
shall provide to Seller a certificate of insurance evidencing comprehensive
general liability coverage in the amount of at least $1,000,000, naming Seller
as an additional insured with respect to the Property. The provisions of this
Section 8.a shall survive the Closing or any earlier termination of this
Agreement for a period of one (1) year.

 

b.                                      Seller
hereby agrees that, if Purchaser shall not be satisfied (in Purchaser’s sole
and subjective discretion) with the due diligence performed pursuant to the
foregoing Section 8.a, Purchaser may terminate this Agreement by giving written
notice of termination to Seller before 5:00 p.m. (Pacific Time) on the last day
of the Review Period. If the termination notice provided in this
Section 8.b is timely given, then in such event, the Agreement will
terminate and the Title Company shall be obligated to immediately return the
Escrow Deposit to Purchaser. If such termination notice is not timely given,
then Purchaser shall be deemed to have disapproved of such due diligence and in
such event, this Agreement shall automatically terminate and the Escrow Agent
shall be obligated to immediately return the Escrow Deposit to Purchaser. If
Purchaser is satisfied with such due diligence, Purchaser may waive the
foregoing termination right by giving written notice of such waiver to Seller
before the expiration of the Review Period.

 

c.                                       Following
the Contingency Expiration Date, Purchaser’s obligation to consummate the
purchase of the Property shall be subject to the satisfaction of the following
conditions (collectively, the “Closing Conditions”):

 

(1)                                  All
of Seller’s representations and warranties contained in or made pursuant to
this Agreement shall have been true and correct in all material respects when
made and, as of the Closing Date, such representations and warranties shall be
true and correct in all material respects and no fact or condition shall exist
which is materially and adversely inconsistent with such representations and
warranties.

 

(2)                                  The
physical condition of the Property shall be substantially the same on the
Closing Date as on the Effective Date, reasonable wear and tear and (subject to
Section 7 above) loss by casualty excepted, and, as of the Closing Date, there
shall be no litigation or administrative agency or other governmental
proceeding of any kind whatsoever, pending or threatened, which after Closing would,
in Purchaser’s reasonable discretion, materially and adversely affect the value
of the Property or the ability of Purchaser to operate the Property as intended
by Purchaser.

 

(3)                                  Seller
will execute and deliver to Purchaser, on the Closing Date, an estoppel
certificate from Seller, as the tenant under the Lease. Said certificate shall be
substantially in the form of

 

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the Estoppel Certificate attached hereto as Exhibit H, and shall
be dated as of the Closing Date (the “Estoppel Certificate”). If Seller
is unable to provide Purchaser with the Estoppel Certificate on the Closing
Date substantially in the form of said Exhibit H, or in another mutually
agreeable form in the event that any future change in facts or circumstances
requires Seller to modify such Exhibit H form, Purchaser may elect to
either (i) terminate this Agreement, in which case the Escrow Deposit
shall be returned to Purchaser, or (ii) consummate the transaction in
accordance with the provisions hereof without any reduction in the Purchase
Price. If requested by Purchaser, Seller will execute and deliver to Purchaser on
the Closing Date a subordination, non-disturbance and attornment agreement from
Seller (the “SNDA”), as tenant under the Lease. Said agreement shall be
in such form as Purchaser’s lender and Seller shall mutually agree upon, and
shall be dated as of the Closing Date. If Seller is unable to provide Purchaser
with a fully-executed SNDA on the Closing Date, Purchaser may elect to either
(i) terminate this Agreement, in which case the Escrow Deposit shall be
returned to Purchaser, or (ii) consummate the transaction in accordance with
the provisions hereof without any reduction in the Purchase Price. Notwithstanding
the foregoing, if Purchaser’s lender is other than Countrywide Commercial Real
Estate Finance, Inc., Seller and Purchaser acknowledge and agree that such
lender may require a form of Estoppel Certificate different from that attached
hereto as Exhibit H; in such event, the parties hereto agree to
cooperate and use good faith efforts to approve an Estoppel Certificate
reasonably acceptable to Seller, Purchaser and Purchaser’s lender.

 

(4)                                  Seller
delivering to Purchaser all documents required for the Closing hereunder, including
without limitation, the documents and instruments specified in Section 4.b,
above.

 

(5)                                  At
the Closing the Title Company shall be irrevocably committed to issue to
Purchaser the TLTA Title Policy pursuant to Section 4.b, above.

 

(6)                                  On the Closing Date, Seller shall deliver to
Purchaser (or shall have previously delivered) originals, or copies to
the extent originals are not available, of the Plans (defined in Exhibit B);
and all operating manuals, service records and similar documents for the
elevators, HVAC and other equipment and building systems.

 

(7)                                  All
other conditions to Purchaser’s obligation to consummate the Closing set forth
in the Agreement shall be satisfied by the Closing Date.

 

d.                                      If
any of the Closing Conditions are not satisfied or waived, in writing, by
Purchaser by the Closing Date, Purchaser shall notify Seller in writing of
those Closing Conditions which have not been satisfied or otherwise waived by
Purchaser (the “Closing Conditions Failure Notice”), which Closing
Conditions Failure Notice shall be delivered to Seller on or before the Closing
Date. Seller shall have one (1) business day after Purchaser has delivered to
Seller the Closing Conditions Failure Notice (and the Closing Date shall be
extended if necessary to give Seller such one (1) business day period) to
notify Purchaser in writing of Seller’s election either to (i) take such
actions as may be necessary to cure such matters to Purchaser’s satisfaction
prior to the Closing (as same may be extended), or (ii) advise Purchaser
that Seller will not cure such matters (the “Seller’s Conditions Notice”).
If Seller elects not to cure such matters, then within one (1) business day
after Purchaser’s receipt of the Seller’s Conditions Notice (and the Closing
Date shall be extended if necessary to give Purchaser such one (1) business day
period), Purchaser, may at its option either (x) proceed with the Closing
without adjustment of the Purchase Price, or (y) terminate this Agreement by
delivering written notice thereof to Seller and have the Escrow Deposit

 

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returned to Purchaser, as
Purchaser’s sole and exclusive remedy at law or in equity. If Purchaser elects
to terminate this Agreement, neither Seller nor Purchaser shall have any further
liability or obligations hereunder. If Seller elects to cure such matters as
set forth in the Closing Conditions Failure Notice, Seller shall promptly use
diligent efforts to cure same and the Closing Date shall be extended for a
period of time acceptable to both Seller and Purchaser to enable Seller to
accomplish same. Failure by Purchaser to notify Seller of the approval or
waiver by Purchaser of any of the contingencies set forth in this Agreement
shall be deemed disapproval by Purchaser of such matters.

 

9.                                      Representations,
Warranties and Covenants of Purchaser. Purchaser represents and
warrants to and covenants with Seller as follows:

 

a.                                       Purchaser
is a limited liability company duly organized, validly existing and in
corporate and tax good standing under the laws of the state of its
incorporation.

 

b.                                      Purchaser
has all requisite power and authority to execute and deliver this Agreement and
any associated agreements to which it is a party and to perform its obligations
hereunder and thereunder, without the joinder or consent of any other person or
other party.

 

10.                               Representations,
Warranties and Covenants of Seller. Seller represents and warrants to
and covenants with Purchaser as follows:

 

a.                                       Seller
has good record title to the Property.

 

b.                                      Seller
is a corporation duly organized, validly existing and in corporate and tax good
standing under the laws of the state of its incorporation. Seller has all
requisite power and authority to execute and deliver this Agreement and any
associated agreements to which it is a party and to perform its obligations
hereunder and thereunder, without the joinder or consent of any other person or
other party.

 

c.                                       There
is no pending condemnation or similar proceeding affecting the Property.

 

d.                                      There
are no legal actions, suits or other legal or administrative proceedings
pending which would affect Seller’s interest in the Property.

 

e.                                       There
are no leases, licenses, subleases or occupancy agreements with respect to the
Property in effect and no person or party other than Purchaser has any right or
option to lease, purchase, occupy, use or possess the Property, or any portion
thereof or any interest therein.

 

f.                                         To
Seller’s actual knowledge, without duty of investigation, there are no material
physical defects of the Property or any off-site improvements and all such
items are in good operating condition and repair and in compliance with all
applicable governmental laws and regulations.

 

g.                                      Seller
has no knowledge of any previous or present release, remediation, generation,
storage, disposal or existence on, in or under the Property of any hazardous
materials and Seller has not generated, released, stored, or disposed of any
hazardous materials on, in or under the Property in violation of any laws,
statutes, orders or regulations.

 

9

 

h.                                      All
Contracts (as defined in Exhibit C) held by Seller as tenant under the
Lease shall be maintained by Seller, as tenant, in accordance with the
provisions of the Lease.

 

i.                                          There
are no property or asset management agreements in effect with respect to the
Property.

 

j.                                          Seller shall
not, after the Effective Date, without first involving Purchaser therein and
obtaining Purchaser’s written consent thereto, enter into any lease, amendment
of lease, contract or other agreement affecting the 780 Building which would
survive the Closing. Seller shall fully cooperate with Purchaser in its
acquisition of the Property, including, but not limited to, promptly delivering
to Purchaser a list of all potential tenants and their representatives and
telephone numbers, and if requested to do so by Purchaser, making introductions
to such representatives, touring prospective tenants through the 780 Building,
allowing Purchaser to directly negotiate with any and all potential tenants,
and executing any and all reasonably necessary documents as requested by
Purchaser. Purchaser shall have the right to disclose to all interested parties
the existence of this Agreement.

 

11.                               Limitation
of Survival. The covenants, representations and warranties of
Purchaser and Seller set forth above and contained elsewhere in this Agreement
shall survive and be enforceable after the Closing for a limited period of nine
(9) months following the Closing (the “Survival Period”).

 

EXCEPT FOR THE
EXPRESS REPRESENTATIONS AND WARRANTIES MADE BY SELLER IN SECTION 10
HERETO, SELLER MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED,
CONCERNING THE PROPERTY INCLUDING WITHOUT LIMITATION WITH RESPECT TO ANY
HAZARDOUS SUBSTANCE OR ENVIRONMENTAL MATTERS, IT BEING SPECIFICALLY UNDERSTOOD
BY PURCHASER THAT, EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN SECTION 10
HERETO, THE PROPERTY IS BEING SOLD AND TRANSFERRED “AS IS” IN ALL RESPECTS. SELLER
SPECIFICALLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR SUITABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE OF PURCHASER’S, WHETHER OR NOT SELLER HAS
BEEN MADE AWARE OF ANY SUCH PURPOSE.

 

12.                               Limitation
of Liability. Seller shall not be liable for any amounts with respect
to the breach of a representation, covenant, or warranty unless and until such
amounts shall exceed, in the aggregate, fifty thousand dollars ($50,000) (the “Limitation
Amount”) (in which case Seller shall only be liable with respect to the
excess over the Limitation Amount). Seller shall have no liability with respect
to any such matter for individual amounts of less than ten thousand dollars
($10,000) until such amounts, in the aggregate, exceed the Limitation Amount,
in which case Seller shall only be liable with respect to the excess over the
Limitation Amount. In no event shall Seller’s liability with respect to the
breach of covenants, representations and warranties exceed twenty-five percent
(25%) of the Purchase Price in the aggregate.

 

13.                               Due
Diligence. Purchaser agrees that it will have engaged in the entire due
diligence effort it deems appropriate as of the end of the Review Period. The
sale of the Property is on an “AS IS, WHERE IS” basis, and is based solely upon
the results of such due diligence without reliance upon the representations or
statements of Seller, other than as expressly set forth in Section 10.

 

10

 

14.                               Brokers.
Purchaser agrees to pay a commission to Commercial Property Services/CORFAC
International (the “Broker”), which commission shall be payable at the
Closing pursuant to a separate written agreement between Purchaser and the
Broker. It is agreed that if any other claims for brokerage commissions or fees
are ever made against Seller or Purchaser in connection with this transaction,
all such claims shall be handled and paid by the party whose commitments form
the basis of such claim. It is further agreed that each party agrees to
indemnify and hold harmless the other from and against any and all other such
claims or demands with respect to any brokerage fees or agents’ commissions or
other compensation asserted by any other person, firm or corporation in
connection with this Agreement or the transactions contemplated hereby insofar
as any such claim or demand is based upon a contract, commitment or other
actions of the indemnifying party. The provisions of this Section shall survive
the Closing.

 

15.                               Assignment
of Agreement. Without being relieved of any liability under this
Agreement, Purchaser reserves the right to take title to the Property in a name
or nominee other than Purchaser. Purchaser may assign its rights and delegate
its obligations under this Agreement to (i) any affiliated or related entity of
Purchaser, or (ii) any entity in which Purchaser or an affiliated or related
entity of Purchaser is a member or partner, without first obtaining Seller’s
consent thereto; provided that, Purchaser delivers to Seller prior written
notice thereof and a copy of any assignment agreement. No assignment by
Purchaser shall relieve Purchaser of its obligations under this Agreement.

 

16.                               Purchaser
Audit Rights. To the extent not previously delivered to Purchaser,
Seller shall provide, or cause to be provided, to Purchaser and Dividend
Capital copies of and shall grant Purchaser and Dividend Capital access to,
such factual information relating to the Property (the “Disclosure
Information”) that is reasonably requested by Purchaser and Dividend
Capital and is in Seller’s possession or control, to enable Dividend Capital to
make the necessary filings as and when such filings with the Securities and
Exchange Commission are required and to otherwise permit Dividend Capital to
comply with laws applicable to public companies, generally. Seller shall have
no obligation to assume any liability as a result of such cooperation, and
Purchaser acknowledges and agrees that all Disclosure Information delivered by
Seller to Purchaser, Dividend Capital and its auditor will be delivered as a
convenience only and that any reliance on or use of such Disclosure Information
shall be at the sole risk of Purchaser, Dividend Capital and its auditor.
Purchaser, on behalf of itself and Dividend Capital, acknowledges and agrees
that none of Seller, any affiliate of the Seller or the person or entity that
prepared such Disclosure Information delivered to Purchaser, Dividend Capital
or its auditor shall have any liability to Purchaser, Dividend Capital or its
auditor for any inaccuracy in or omission from any Disclosure Information. The
obligations of Purchaser under this Section 16 shall survive the Closing.

 

17.                               Miscellaneous.

 

a.                                       Time
is of the essence of this Agreement. Without limiting the generality of the
foregoing, Purchaser acknowledges and agrees that Seller is willing to enter
into this Agreement at the stated Purchase Price on the express condition that
the Closing shall occur by the stated Closing Date, and in the event that
Purchaser shall not be prepared to close on such Closing Date, Seller shall be
under no obligation to extend the Closing Date and shall have the right to
immediately enforce its remedies as provided in Section 5 of this Agreement.

 

11

 

b.                                      This
Agreement constitutes the entire agreement of the parties hereto, supersedes
any prior agreement with respect to the subject matter hereof, and may not be
modified, amended or supplemented except by a written agreement signed by
Seller and Purchaser and dated subsequent to the date hereof. If any provision
of this Agreement shall be held invalid or unenforceable, the remainder of the
Agreement shall not be affected thereby. This Agreement may not be recorded.

 

c.                                       This
Agreement shall be enforced, construed and interpreted under the laws of the
State of Texas.

 

d.                                      Any
notice hereunder must be in writing, and shall be effective (i) three (3) days
after deposit in the United States Mail, Certified Return Receipt Requested,
(ii) one (1) day after deposit with a recognized overnight courier service, or
(iii) upon receipt (or refusal of receipt) if delivered via personal delivery
or facsimile, addressed to the parties as set forth below (or such other
address as may be designated from time to time, in writing, as provided in this
Section):

 

	
  To Seller:

  	
   

  	
  Flextronics
  International USA, Inc.

  
	
   

  	
   

  	
  2090 Lundy
  Avenue

  
	
   

  	
   

  	
  San Jose, CA
  95131

  
	
   

  	
   

  	
  Attention:
  Timothy Stewart

  
	
   

  	
   

  	
  Phone
  number: 408.576.7746

  
	
   

  	
   

  	
  Facsimile
  number: 408.428.0859

  
	
   

  	
   

  	
  E-mail:
  tim.stewart@flextronics.com

  
	
   

  	
   

  	
   

  
	
  with a copy
  to:

  	
   

  	
  Robins,
  Kaplan, Miller & Ciresi L.L.P.

  
	
   

  	
   

  	
  800 Boylston
  Street

  
	
   

  	
   

  	
  Boston, MA
  02199

  
	
   

  	
   

  	
  Attention:
  Mark S. LaConte, Esq.

  
	
   

  	
   

  	
  Phone
  number: 617.859.2785

  
	
   

  	
   

  	
  Facsimile
  number: 617.859.2726

  
	
   

  	
   

  	
  E-mail:
  mslaconte@rkmc.com

  
	
   

  	
   

  	
   

  
	
  To
  Purchaser:

  	
   

  	
  WESTCORE
  PROPERTIES AC, LLC

  
	
   

  	
   

  	
  235 Pine
  Street, Suite 1150

  
	
   

  	
   

  	
  San
  Francisco, California 94104

  
	
   

  	
   

  	
  Attention:
  Neil Johnson

  
	
   

  	
   

  	
  Phone
  number: 415-391-8400

  
	
   

  	
   

  	
  Facsimile
  number: 415-391-8406

  
	
   

  	
   

  	
  E-mail:
  njohnson@westcore.net

  

 

12

 

	
  with a copy
  to:

  	
   

  	
  WESTCORE
  PROPERTIES AC, LLC

  
	
   

  	
   

  	
  4445
  Eastgate Mall, Suite 210

  
	
   

  	
   

  	
  San Diego,
  California 92121

  
	
   

  	
   

  	
  Attention:
  Diane Robertson

  
	
   

  	
   

  	
  Phone
  number: (858) 625-4100 ext. 223

  
	
   

  	
   

  	
  Facsimile
  number: (858) 678-0060

  
	
   

  	
   

  	
  E-mail:
  drobertson@westcore.net

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  Real Estate Law Group, LLP

  
	
   

  	
   

  	
  2330
  Marinship Way, Suite 211

  
	
   

  	
   

  	
  Sausalito, California 94965

  
	
   

  	
   

  	
  Attention: Bonnie Frank, Esq.

  
	
   

  	
   

  	
  Phone number:
  415-331-2555

  
	
   

  	
   

  	
  Facsimile
  number: 415-331-7272

  
	
   

  	
   

  	
  E-mail:
  bfrank@relg.com

  

 

e.                                       The
“Effective Date” of this Agreement shall be the date on which the Title
Company shall have received a copy of this Agreement signed by the Seller and
Purchaser. The Title Company’s receipt shall be conclusive as to the Effective
Date, and the Title Company shall immediately notify Purchaser and Seller of
the Effective Date.

 

f.                                         This
Agreement may be executed in counterparts, each of which will be an original
and all of which taken together shall constitute one contract. The parties
agree that the delivery of an executed copy of this Agreement by facsimile
shall be legal and binding and shall have the same full force and effect as if
an original of this Agreement had been delivered. Facsimile signatures of this
Agreement shall be binding upon the parties, provided that hard copies of such
signatures are delivered (as specified herein) within forty-eight (48) hours
thereafter.

 

g.                                      If
any date set forth in the Agreement for the performance of any obligation by
Purchaser or Seller for the delivery of any instrument or notice should be on a
Saturday, Sunday or legal holiday, the compliance with such obligation or
delivery shall be deemed acceptable on the next business day following such
Saturday, Sunday, or legal holiday. For purposes of this paragraph “legal
holiday” shall mean any state or federal holiday for which financial
institutions or post offices are generally closed in the vicinity of the
Property, for the observance thereof.

 

h.                                      This
Agreement and the terms and provisions hereof shall inure to the benefit of and
be binding upon the parties hereto and their respective heirs, legal
representatives, successors and permitted assigns wherever the context so
requires or admits.

 

i.                                          Seller
agrees that Purchaser shall have no liability whatsoever as a successor in
interest for any contracts or agreements entered into by Seller prior to
Closing in connection with its ownership or operation of the Property or the
use, occupancy or construction of the Improvements located thereon; and Seller
shall fully perform all of its commitments and obligations under any such
contracts and agreements and shall indemnify and defend Purchaser against (by
counsel reasonably acceptable to Purchaser) and hold Purchaser and its partners
and members harmless from any and all losses, costs,

 

13

 

damages, liabilities and expenses, including without limitation
reasonable attorneys’ and experts’ fees and costs and brokerage commissions
with respect to such contracts and agreements referenced herein.

 

j.                                          Seller
and Purchaser shall cooperate with one another at reasonable times and on
reasonable conditions and shall execute and deliver such instruments and
documents as may be necessary in order fully to carry out the intent and
purposes of the transaction contemplated hereby. Except for such instruments
and documents as the parties are obligated to deliver by the terms of this
Agreement, such cooperation shall be without additional cost or liability. The
provisions of this section shall survive the Closing.

 

k.                                       Purchaser
shall have the right (provided Purchaser has notified Seller in writing at least
seven (7) days prior to the date set for the Closing) to assign its rights (but
not delegate its obligations) under this Agreement to an accommodator, pursuant
to an agreement reasonably acceptable to both Seller and Purchaser, which will
enable Purchaser to accomplish a deferred exchange in accordance with the
provisions of Section 1031 of the Internal Revenue Code, as amended. The
parties shall cooperate with one another in such exchange provided that: (i)
Seller shall not incur any additional liability or financial obligation as a
consequence of Purchaser’s exchange; (ii) any such exchange shall in no way
increase the amount of monies for which Seller is obligated to pay under the
provisions of this Agreement; (iii) Seller shall not be required to accept
title (beneficial or legal) to any parcel or parcels of other real property;
(iv) Purchaser shall defend, protect, indemnify and hold Seller harmless from
any and all liabilities, claims, losses, or expenses which Seller incurs, or to
which Seller may be exposed, as a result of Seller’s participation in the
exchange contemplated herein, including, but not limited to, reasonable
attorneys’ fees and other costs of defense; and (v) all covenants of Purchaser
as set forth in this Agreement shall not be affected or limited by Purchaser’s
use of an exchange accommodator. The performance by the parties of their
obligations under this Agreement shall not be contingent upon Purchaser’s
ability to effectuate an exchange, provided that Seller does not take any acts
or fail to take any acts which materially and adversely affects Purchaser’s
ability to effectuate such an exchange.

 

l.                                          If
for any reason, any provision of this Agreement shall be held to be
unenforceable, it shall not affect the validity or enforceability of any other
provision of this Agreement and to the extent any provision of this Agreement
is not determined to be unenforceable, such provision, or portion thereof,
shall be, and remain, in full force and effect.

 

m.                                    The
acceptance of a deed by Purchaser or its nominee or assignee, as the case may
be, shall be deemed to merge and be a full performance and discharge of every
agreement and obligation of Seller herein contained or expressed, except such
as are, by the express terms hereof, to be performed after the delivery of said
deed, including, but not limited to, the continued effectiveness of Seller’s
representations and warranties contained herein which shall neither terminate
nor be deemed merged until the end of the Survival Period (provided no claim
has been brought by Purchaser prior to the end of the Survival Period).

 

[SIGNATURE PAGE TO FOLLOW]

 

14

 

IN WITNESS
WHEREOF, the parties have caused this Agreement to be executed as of the dates
indicated below.

 

 

	
   

  	
  SELLER:

  
	
   

  	
   

  
	
   

  	
  FLEXTRONICS
  INTERNATIONAL USA, INC.,

  
	
   

  	
  a California corporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy L. Stewart

  	
   

  
	
   

  	
  Name:

  	
  Timothy L. Stewart

  	
   

  
	
   

  	
  Title:

  	
  VP

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Date
  executed by Seller: November 3, 2006

  

 

 

	
   

  	
  PURCHASER:

  
	
   

  	
   

  
	
   

  	
  WESTCORE
  PROPERTIES AC, LLC,

  
	
   

  	
  a Delaware
  limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Donald Ankeny

  	
   

  
	
   

  	
  Name:

  	
  Donald Ankeny

  	
   

  
	
   

  	
  Title:

  	
  President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Date
  executed by Purchaser: Nov. 6th,
  2006

  

 

15

 

The
undersigned hereby acknowledges receipt of a fully executed copy of this
Agreement, and agrees to perform the duties of the Title Company, including
disbursement of the Escrow Deposit, strictly in accordance with the terms of
this Agreement.

 

	
   

  	
  TITLE
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  CHICAGO
  TITLE INSURANCE COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joycelyn Armstrong

  	
   

  
	
   

  	
  Name:

  	
  Joycelyn Armstrong

  	
   

  
	
   

  	
  Title:

  	
  Commercial Escrow Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:
  November 8, 2006

  

 

16

 

EXHIBIT A

 

LEGAL DESCRIPTION OF LAND

 

LOTS 1, 2 AND 3, BLOCK A OF
FLEXTRONICS CAMPUS ADDITION, an addition to the Cities of Richardson and Plano,
Collin County, Texas, according to the plat thereof recorded in Cabinet N, Page
527, Map Records, Collin County, Texas.

 

1

 

EXHIBIT B

 

FORM OF LEASE

 

 

See Attached

 

1

 

WESTCORE PROPERTIES, LLC

Single-Tenant lndustrial/Commercial Lease

(Net)

 

1.                                       Basic Provisions (“Basic Provisions”).

 

1.1                                 Parties: This Lease (“Lease”),
effective December             
, 2006 (“Effective Date”), is made by and
between WESTCORE                             ,
LLC, a Delaware limited liability company (“Lessor”)
and FLEXTRONICS INTERNATIONAL USA, INC., a
California corporation (“Lessee”),
(collectively the “Parties,” or individually a “Party”).

 

1.2                                 Premises; Parking.

 

(a)                                  Premises: That certain real property, including all
improvements therein, commonly known by the street addresses 600, 620, and 640
Shiloh Road located in Plano, Texas, as outlined on Exhibit A attached
hereto (“Premises”). The Premises includes one
building located at 600 Shiloh Road (the “600 Building”)
consisting of approximately [178,000 square feet; to be confirmed during Review
Period], one building located at 620 Shiloh Road (the “620
Building”) consisting of approximately [125,000 square feet; to be
confirmed during Review Period], and one building located at 640 Shiloh Road
(the “640 Building”) consisting of
approximately [136,000 square feet; to be confirmed during Review Period]
(each, a “Building” and, collectively, the “Buildings”). (Also see Paragraph 2.)

 

(b)                                 Parking: Lessee shall be entitled to use all vehicle parking
spaces within the Premises (“Parking Spaces”),
but none of the vehicle parking spaces utilized in connection with the building
located at 780 Shiloh Road, Plano, Texas (the “780
Building”). (Also see Paragraph 2.3.)

 

1.3                                 Term: The term of this Lease shall be for a period of one
hundred twenty (120) full calendar months (“Original Term”)
commencing on the date (the “Commencement Date”)
that Lessor acquires fee simple title to the Premises from Lessee as set forth
in Paragraph 2.1 below. The term “Expiration Date”
shall mean the date that is the last day of the month in which the tenth (10th)
anniversary of the Commencement Date occurs. For purposes of this Lease, the “Term” of this Lease shall refer to the Original Term, as it
may be extended or renewed by any properly exercised options granted hereunder.
(Also see Paragraph 3.)

 

1.4                                 Early Possession: Not Applicable. Lessee is the current
owner and occupant of the Premises.

 

1.5                                 Base Rent: Payable monthly, commencing on the Commencement
Date and continuing on the first day of each month thereafter during the Term,
in the amount described in the tables that appear below for each of the three
Buildings (“Base Rent”): [SQ. FT. TO BE
CONFIRMED]

 

1

 

(a)                    The 600 Building

 

	
   

  	
   

  	
  Monthly

  	
   

  
	
  Months of

  	
   

  	
  Installment

  	
   

  
	
  Original Term

  	
   

  	
  of Base Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1 through l2

  	
   

  	
  $

  	
  100,125.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  13 through
  24

  	
   

  	
  $

  	
  103,128.75

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  25 through
  36

  	
   

  	
  $

  	
  106,222.61

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  37 through 48

  	
   

  	
  $

  	
  109,409.28

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  49 through
  60

  	
   

  	
  $

  	
  112,691.55

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  61 through
  72

  	
   

  	
  $

  	
  116,072.29

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  73 through
  84

  	
   

  	
  $

  	
  119,554.45

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  85 through
  96

  	
   

  	
  $

  	
  123,141.08

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  97 through
  108

  	
   

  	
  $

  	
  126,835.31

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  109 though
  120

  	
   

  	
  $

  	
  130,640.36

  	
   

  

 

(b)                   The 620 Building

 

	
   

  	
   

  	
  Monthly

  	
   

  
	
  Months of

  	
   

  	
  Installment

  	
   

  
	
  Original Term

  	
   

  	
  of Base Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1 through 12

  	
   

  	
  $

  	
  44,270.83

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  13 through
  24

  	
   

  	
  $

  	
  45,598.95

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  25 through
  36

  	
   

  	
  $

  	
  46,966.95

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  37 through
  48

  	
   

  	
  $

  	
  48,375.96

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  49 through
  60

  	
   

  	
  $

  	
  49,827.24

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  61 through
  72

  	
   

  	
  $

  	
  51,322.06

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  73 through
  84

  	
   

  	
  $

  	
  52,861.72

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  85 through
  96

  	
   

  	
  $

  	
  54,447.58

  	
   

  

 

2

 

	
   

  	
   

  	
  Monthly

  	
   

  
	
  Months of

  	
   

  	
  Installment

  	
   

  
	
  Original Term

  	
   

  	
  of Base Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  97 through
  108

  	
   

  	
  $

  	
  56,081.01

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  109 though
  120

  	
   

  	
  $

  	
  57,763.44

  	
   

  

 

(c)                    The 640 Building

 

	
   

  	
   

  	
  Monthly

  	
   

  
	
  Months of

  	
   

  	
  Installment

  	
   

  
	
  Original Term

  	
   

  	
  of Base Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1 through 12

  	
   

  	
  $

  	
  76,500.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  13 through
  24

  	
   

  	
  $

  	
  78,795.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  25 through
  36

  	
   

  	
  $

  	
  81,158.85

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  37 through 48

  	
   

  	
  $

  	
  83,593.62

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  49 through
  60

  	
   

  	
  $

  	
  86,101.43

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  61 through
  72

  	
   

  	
  $

  	
  88,684.72

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  73 through
  84

  	
   

  	
  $

  	
  91,345.25

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  85 through
  96

  	
   

  	
  $

  	
  94,085.61

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  97 through
  108

  	
   

  	
  $

  	
  96,908.18

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  109 though
  120

  	
   

  	
  $

  	
  99,815.43

  	
   

  

 

1.6                                 Permitted Use: Lessee shall use and occupy the Premises for
general office, manufacturing and warehouse uses as may be permitted under
existing zoning laws governing the Premises and for no other use or purpose (“Permitted Use”). (Also see Paragraph 6.)

 

1.7                                 (a)                                  Real Estate Brokers. The following real estate broker(s)
(collectively, the “Brokers”) and
brokerage relationships exist in this transaction and are consented to by the
Parties (check applicable boxes):

 

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

 

x                                  CPS
CORFAC International represents Lessee exclusively (“Lessee’s
Broker”);

 

3

 

o                                                                                                 
represents both Lessor and Lessee (“Dual Agency”)
(Also see Paragraph 15.)

 

(b)                                 Payment to Brokers. Upon the execution of this Lease by both
Parties, Lessor shall pay to said Broker(s) jointly, or in such separate shares
as they may mutually designate in writing, a fee as set forth in a separate
written agreement between Lessor and said Broker(s)

 

1.8                                 Guarantor(s): The obligations of Lessee under this Lease are
to be guaranteed by None (“Guarantor”).
(See also Paragraph 37)

 

1.9                                 Exhibits. Attached hereto are Exhibits A and B, all of which
constitute a part of this Lease.

 

2.                                       Premises and Parking.

 

2.1                                 Lease Conditioned Upon Acquisition; Letting. As of the
Effective Date, Lessee holds fee simple title to the Premises. Pursuant to that
certain Purchase and Sale Agreement dated November    ,
2006 (as assigned, the “Purchase Agreement”)
by and between Lessee, as Seller, and Lessor, as Buyer, Lessee has agreed to
sell the Premises to Lessor and Lessor has agreed to buy the Premises from
Lessee, subject to the terms contained therein. Lessor’s obligations under this
Lease are expressly conditioned upon Lessor acquiring fee simple title to the
Premises from Lessee in accordance with the Purchase Agreement. Subject to the
satisfaction of the foregoing condition precedent, Lessor hereby leases to
Lessee, and Lessee hereby leases from Lessor, the Premises, for the Term, at
the rental, and upon all of the terms, covenants and conditions set forth in
this Lease. Unless otherwise provided herein, any statement of square footage
set forth in this Lease, or that may have been used in calculating Base Rent is
an approximation which Lessor and Lessee agree is reasonable and any payments
based thereon are not subject to revision whether or not the actual square
footage is more or less.

 

2.2                                 Condition. Lessee acknowledges that it has occupied the
Premises as the owner since                       
and has constructed          
of the Buildings, and, therefore, Lessee represents that it has full and
complete knowledge concerning the condition of the Premises. Lessee agrees (i)
to accept the Premises on the Commencement Date as then being suitable for
Lessee’s intended use and in good operating order, condition and repair in its
then existing “AS IS”
condition, and (ii) that neither Lessor nor any of Lessor’s agents,
representatives or employees has made any representations as to the
suitability, fitness or condition of the Premises for the conduct of Lessee’s
business or for any other purpose. Lessee does hereby waive and disclaim any
objection to, cause of action based upon, or claim that its obligations hereunder
should be reduced or limited because of the condition of the Premises or the
suitability of same for Lessee’s purposes. 

 

2.3                                 Vehicle Parking. Lessee shall be entitled to use all of the
Parking Spaces in accordance with Subparagraph 1.2 (b) of the Basic Provisions.

 

4

 

3.                                       Term.

 

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

 

3.2                                 Lessee’s Early Termination Right. Notwithstanding anything
to the contrary contained in this Lease and provided that Lessee is not then in
material Breach under this Lease, Lessee shall have a one time right to
terminate this Lease on the seventh (7th) anniversary of the
Commencement Date by giving Lessor written notice of Lessee’s election to
terminate this Lease not less than one hundred eighty (180) days prior to such
termination date. If Lessee fails to exercise such termination right in
accordance with the foregoing terms, Lessee shall have no further right of
early termination under this Section 3.2. 

 

3.3                                 Option to Extend. Lessee shall have two (2) options (each,
an “Option” and, collectively, the “Options”) to extend the Term for a period of five (5) years
each (each, an “Option Term” and, collectively, the
“Option Terms”), which Options shall be
exercisable by written notice delivered by Lessee to Lessor as provided in this
Paragraph 3, 4, provided that Lessee is not then in Breach under this Lease. The
Option shall be exercisable only by the originally named Lessee under this
Lease (the “Original Lessee”) or a Lessee’s
Affiliate (as hereinafter defined) and only if the Original Lessee and/or
Lessee’s Affiliate is in possession of at least fifty percent (50%) of the
Premises.

 

(a)                                  Exercise of Option. The Options may be exercised by Lessee,
if at all, only in the following manner: (i) Lessee shall deliver written
notice (the “Option Notice”) to Lessor not
more than twelve (12) months, nor less than nine (9) months, prior to the
expiration of the Term or the first Option Term, as applicable, stating that
Lessee is interested in exercising the Option; (ii) Lessor, after receipt of
Lessee’s notice, shall deliver notice (the “Option Rent Notice”)
to Lessee within thirty (30) days of Lessor’s receipt of the Option Notice
setting forth the “Option Rent,” as that term is defined in subparagraph (b) below, which
shall be applicable to the Lease during the applicable Option Term; and (iii)
if Lessee wishes to exercise such Option, Lessee shall, on or before the date ten
(10) business days after Lessee’s receipt of the Option Rent Notice, exercise
such Option by delivering written notice thereof to Lessor, and upon, and
concurrent with, such exercise, if the Option Rent was determined in accordance
with subparagraph (b) below, Lessee may, at its option, object to the Option
Rent contained in the Option Rent Notice, in which case the parties shall
follow the procedure, and the Option Rent shall be determined, as set forth in
subparagraph (c) below.

 

(b)                                 Option Rent. The Base Rent payable by Lessee during the
applicable Option Term (the “Option Rent”)
shall be equal to the prevailing annual market rental value for comparable
space in the area in which the Premises are located, including all escalations,
at which tenants, as of the commencement of the applicable Option Term, are
leasing non-sublease, non- renewal, non-encumbered, non-equity space in
comparable buildings for a comparable term. In no event shall the Option Rent
be less than the Base Rent then in effect.

 

(c)                                  Determination of Option Rent. In the event Lessee timely and
appropriately objects to the Option Rent, Lessor and Lessee shall attempt to
agree upon the Option Rent using their best good-faith efforts. If Lessor and
Lessee fail to reach agreement within ten (10) days following Lessee’s
objection to the Option Rent (the “Outside Agreement Date”),
then Lessee

 

5

 

may give written notice (“Appraisal Notice”)
to Lessor that Lessee desires to have the Option Rent determined by appraisal
pursuant to the procedures set forth in subparagraphs (i) through (iv) below.

 

(i)                                     Within
ten (10) days after Lessor’s receipt of the Appraisal Notice in accordance with
this Paragraph, Lessor and Lessee shall agree upon a list of three (3)
independent, unaffiliated real estate brokers with at least five (5) years’
full-time experience brokering commercial properties within ten (10) miles of
the Premises. Within five (5) days after agreement upon the list of brokers,
Lessor and Lessee shall meet and each shall have the right to disqualify one
(1) of the brokers until only one (1) broker (“Broker”)
has not been disqualified by either Lessor or Lessee.

 

(ii)                                  Within
fifteen (15) days after the appointment of the Broker, the parties shall each
submit their determination of the Option Rent to the Broker and the Broker
shall independently determine the Option Rent. The Option Rent shall equal the
Option Rent submitted by Lessor or Lessee that is closest to the Option Rent
determined by the Broker. The Broker shall not divulge to Lessor or Lessee the
Option Rent determined by the Broker until both parties instruct it to do so in
writing. The determination of the Broker in accordance with this subsection (c)
shall be final and binding on the parties and a judgment may be rendered
thereon in a court of competent jurisdiction.

 

(iii)                               If
the parties fail to select the three (3) qualified brokers or the Broker, a
Broker shall be selected by the then-Presiding Judge of the Superior Court of
the State of Texas of the County in which the Premises are located, acting in
his individual judicial capacity.

 

(iv)                              The
cost of appraisal shall be paid by Lessor and Lessee equally.

 

During the period requiring the adjustment of monthly Base Rent to
Option Rent, Lessee shall pay, as monthly Base Rent pending such determination,
one hundred five percent (105%) of the monthly Base Rent in effect for the
Premises immediately prior to such adjustment; provided, however, that upon the
determination of the applicable Option Rent, Lessee shall pay Lessor the
difference between the amount of monthly Base Rent Lessee actually paid and
Option Rent immediately upon the determination of the Option Rent. Any amount
of Base Rent Lessee has actually paid to Lessor which exceeds the Option Rent
determined in accordance herewith shall be credited against Lessee’s future
Option Rent obligations.

 

4.                                       Rent. Lessee shall pay Base Rent and other rent or charges,
as the same may be adjusted from time to time, to Lessor in lawful money of the
United States, without notice, offset or deduction (except as otherwise
provided herein), on or before the day on which it is due under the terms of
this Lease. For purposes of this Lease, Base Rent and all other sums or charges
due Lessor from Lessee hereunder may be collectively referred to from time to
time as “Rent” or “rent.” Rent for any period during the Term hereof which is for
less than one (1) full calendar month shall be prorated based upon the actual
number of days of the month involved. Payment of Rent shall be made to Lessor
at its address stated herein or to such other persons or at such other
addresses as Lessor may from time to time designate in writing to Lessee.

 

6

 

5.                                       NNN Lease. Lessee hereby expressly acknowledges and agrees
that it is the intention of the parties to this Lease that this Lease be
construed and enforced as a NNN Lease with Lessee paying all of the customary
expenses and other sums attributable to a NNN Lease in accordance with the
provisions of this Lease.

 

6.                                       Use.

 

6.1                                 Use. Lessee shall use and occupy the Premises only for the
Permitted Use set forth in Paragraph 1.6 of the Basic Provisions, or any other
legal use, which is reasonably comparable thereto, and for no other purpose.
Lessee shall not use or permit the use of the Premises in a manner that is
unlawful, creates waste or a nuisance, or that disturbs owners and/or occupants
of, or causes damage to the Premises or neighboring premises or properties.

 

6.2                                 Hazardous Substances.

 

(a)                                  Reportable Uses Require Consent. The term “Hazardous Substance” as used in this Lease shall mean any
product, substance, chemical, material or waste whose presence, nature,
quantity and/or intensity of existence, use, manufacture, disposal, transportation,
spill, release or effect, either by itself or in combination with other
materials expected to be on the Premises, is either: (i) potentially injurious
to the public health, safety or welfare, the environment, or the Premises; (ii)
regulated or monitored by any governmental authority; or (iii) a basis for
potential liability of Lessor to any governmental agency or third party under
any applicable statute or common law theory. Hazardous Substance shall include,
but not be limited to, hydrocarbons, petroleum, gasoline, crude oil or any
products or by-products thereof. Lessee shall not engage in any activity in or
about the Premises, which constitutes a Reportable Use (as hereinafter defined)
of Hazardous Substances without the express prior written consent of Lessor and
compliance in a timely manner (at Lessee’s sole cost and expense) with all
Applicable Requirements (as defined in Paragraph 6.3). “Reportable
Use” shall mean (i) the installation or use of any above or below
ground storage tank, (ii) the generation, possession, storage, use,
transportation, or disposal of a Hazardous Substance that requires a permit
from, or with respect to which a report, notice, registration or business plan
is required to be filed with, any governmental authority, and (iii) the
presence in, on or about the Premises of a Hazardous Substance with respect to
which any Applicable Requirements require that a notice be given to persons
entering or occupying the Premises or neighboring properties. Notwithstanding
the foregoing, Lessee may, without Lessor’s prior consent, but upon notice to
Lessor and in compliance with all Applicable Requirements, use any ordinary and
customary materials reasonably required to be used by Lessee in the normal
course of the Permitted Use, so long as such use is not a Reportable Use and
does not, in Lessor’s good faith and reasonable business judgment, expose the
Premises or any part thereof, or neighboring properties to any risk of
contamination or damage or, in Lessor’s good faith and reasonable business
judgment, expose Lessor to the possibility of any liability therefor. In
addition, Lessor may (but without any obligation to do so) condition its
consent to any Reportable Use of Hazardous Substance by Lessee upon Lessee’s
giving Lessor such additional assurances as Lessor, in its reasonable
discretion, deems necessary to protect itself, the public, the Premises and the
environment against damage, contamination or injury and/or liability therefor,
including but not limited to the installation (and, at Lessor’s option, removal
on or before Lease expiration or earlier termination) of reasonably necessary
protective modifications to the Premises.

 

7

 

(b)                                 Duty to Inform Lessor. If Lessee knows that a Hazardous
Substance has come to be located in, on, under or about the Premises, other
than as previously consented to by Lessor, Lessee shall immediately give Lessor
written notice thereof, together with a copy of any statement, report, notice,
registration, application, permit, business plan, license, claim, action, or
proceeding given to, or received from, any governmental authority or private
party concerning the presence, spill, release, discharge of, or exposure to,
such Hazardous Substance including but not limited to all such documents as may
be involved in any Reportable Use involving the Premises. Lessee shall not
cause or permit any Hazardous Substance to be spilled or released in, on, under
or about the Premises (including, without limitation, through the plumbing or
sanitary sewer system).

 

(c)                                  Indemnification of Lessor. Lessee shall indemnify, protect,
defend and hold Lessor (with counsel approved by Lessor), its directors,
officers, agents, partners, members, employees, lenders and ground lessor, if
any, and the Premises, harmless from and against any and all damages,
liabilities, judgments, costs, claims, liens, expenses, penalties, loss of
permits and attorneys’ and consultants’ fees arising out of or involving any:
(i) Hazardous Substance located in, on, under or about the Premises prior to
the expiration or earlier termination of this Lease, whether arising before or
during the Term of this Lease, except for any Hazardous Substance introduced
to, or released at, the Premises by Lessor, or (ii) the breach of any term,
condition, representation or warranty contained in this Paragraph 6. Lessee’s
obligations under this Subparagraph 6.2 (c) shall include, but not be limited
to, the effects of any contamination or injury to person, property or the environment
created or suffered by Lessee, and the cost of investigation (including
consultants’ and attorneys’ fees and testing), removal, remediation,
restoration and/or abatement thereof, or of any contamination therein involved,
and shall survive the expiration or earlier termination of this Lease. No
termination, cancellation or release agreement entered into by Lessor and
Lessee shall release Lessee from its obligations under this Lease with respect
to Hazardous Substances, unless specifically so agreed by Lessor in writing at
the time of such agreement. 

 

(d)                                 Environmental Questionnaire Disclosure. Prior to the
execution of this Lease, Lessee shall complete, execute and deliver to Lessor a
Hazardous Substances Survey Form in the form of Exhibit B attached
hereto (“Survey Form”), and Lessee shall
certify to Lessor and Lessor’s lenders that all information contained in the
Survey Form is true and correct to the best of Lessee’s knowledge and belief. The
completed Survey Form shall be deemed incorporated into this Lease for all
purposes, and Lessor shall be entitled to rely on the information contained
therein. Within thirty (30) days following receipt by Lessee of a written
request therefore from Lessor (which request shall not be made by Lessor more
often than one time during any 24 month period unless Lessor has a reasonable
belief that the Hazardous Substances stored, generated, used or disposed of at
the Premises is materially different from those disclosed on the most recent
Survey Form provided by Lessee), Lessee shall disclose to Lessor in writing the
names and amounts of all Hazardous Substances, or any combination thereof,
which were stored, generated, used or disposed of on, under or about the
Premises for the twelve (12) month period prior to and after each such request,
or which Lessee intends to store, generate, use or dispose of on, under or
about the Premises. At Lessor’s option, Lessee’s disclosure obligation under
this Subparagraph shall include the requirement that Lessee update, execute and
deliver to Lessor the Survey Form, as the same may be reasonably modified by
Lessor from time to time.

 

8

 

6.3                                 Lessee’s Compliance with Applicable Requirements. Lessee
shall, at Lessee’s sole cost and expense, fully, diligently and in a timely
manner, comply with all Applicable Requirements relating to Lessee’s particular
use of, or improvements to, the Premises; provided, however, if any
improvements or other work to the Premises is required as a result of changes
in laws, rules, regulations, statutes, ordinances, and similar requirements but
such improvements or other work is not governmentally-mandated to be done and
not otherwise related to Lessee’s particular use of, or improvements made to,
the Premises, then Lessor shall perform such work at its sole cost and expense.
Any improvements or other work to the Premises which is necessitated by
governmentally-mandated Applicable Requirements shall be paid for by Lessee in
the same manner as Capital Expenditures under Paragraph 7.1(d) below,
regardless of whether or not such improvements are considered capital
improvements. For purposes of this Lease, “Applicable Requirements”
shall mean all laws (including, without limitation, the Americans with
Disabilities Act), rules, regulations, ordinances, directives, covenants,
easements and restrictions of record, permits, the requirements of any
applicable fire insurance underwriter or rating bureau, and the recommendations
of Lessor’s engineers and/or consultants, relating in any manner to the
Premises (including but not limited to matters pertaining to (i) industrial
hygiene, (ii) environmental conditions on, in, under or about the Premises,
including soil and groundwater conditions, and (iii) the use, generation, manufacture,
production, installation, maintenance, removal, transportation, storage, spill,
or release of any Hazardous Substance, including, without limitation, preparing
and maintaining a Hazardous Material Management Plan (“HMMP”) if required by a governmental agency having jurisdiction
over the Premises and complying with all applicable Proposition 65 notice
requirements, now in effect or which may hereafter come into effect). If a HMMP
is required, Lessee shall provide a copy of the HMMP to Lessor. As of the date
of this Lease, Lessee represents and warrants to Lessor that, to the best of
Lessee’s knowledge and belief, the Premises, and Lessee’s operations in the
Premises, are in compliance with all Applicable Requirements. Lessee shall,
within five (5) business days after receipt of Lessor’s written request,
provide Lessor with copies of all documents and information, including but not
limited to permits, registrations, manifests, applications, reports and
certificates, evidencing Lessee’s compliance with any Applicable Requirements
specified by Lessor, and shall immediately upon receipt, notify Lessor in
writing (with copies of any documents involved) of any threatened or actual
claim, notice, citation, warning, complaint or report pertaining to or involving
failure by Lessee or the Premises to comply with any Applicable Requirements.

 

6.4                                 Inspection; Compliance with Law. Lessor, Lessor’s agents,
employees, contractors and designated representatives, shall have the right to
enter the Premises at any time in the case of an emergency, and otherwise at
reasonable times upon reasonable prior notice to Lessee, for the purpose of
inspecting the condition of the Premises and for verifying compliance by Lessee
with this Lease and all Applicable Requirements, and Lessor shall be entitled
to employ experts and/or consultants in connection therewith to advise Lessor
with respect to Lessee’s activities, including bat not limited to Lessee’s
installation, operation, use, monitoring, maintenance, or removal of any
Hazardous Substance on or from the Premises. The costs and expenses of any such
inspections shall be paid by the party requesting same, unless a violation of
Applicable Requirements or a contamination, caused or materially contributed to
by Lessee, is found to exist or to be imminent, or unless the inspection is
requested or ordered by a governmental authority as the

 

9

 

result of any such existing or imminent violation or contamination. In
such case, Lessee shall upon request reimburse Lessor for the costs and
expenses of such inspections.

 

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

 

7.1                                 Lessee’s Obligations.

 

(a)                                  Subject
to the provisions of Paragraphs 7.1(d), 9 (Damage or Destruction) and 14
(Condemnation), Lessee shall, at Lessee’s sole cost and expense and at all
times, keep the Premises, Utility Installations and Alterations and every part
thereof in good order, condition and repair (whether or not such portion of the
Premises requiring repair, or the means of repairing the same, are reasonably
or readily accessible to Lessee, and whether or not the need for such repairs
occurs as a result of Lessee’s use, any prior use, the elements or the age of
such portion of the Premises), reasonable wear and tear excepted, including,
without limiting the generality of the foregoing, all equipment or facilities,
such as plumbing, heating, air conditioning, ventilating, electrical, lighting
facilities, boilers, fired or unfired pressure vessels, fire hose connections
if within the Premises, fixtures, walls (interior and exterior), foundations,
ceilings, roofs, roof drainage systems, floors, windows, doors, plate glass,
skylights, landscaping, driveways, parking lots, fences, retaining walls, signs,
sidewalks and parkways located in, on, or adjacent to the Premises. Lessee, in
keeping the Premises in good order, condition and repair, shall exercise and
perform good maintenance practices, specifically including the procurement and
maintenance of the service contracts required by this Paragraph 7.1. Lessee’s
obligations shall include restorations, replacements or renewals when necessary
to keep the Premises and all improvements thereon or a part thereof in good
order, condition and state of repair. Lessee shall, during the term of this
Lease, keep the exterior appearance of the Premises in a first-class condition
(including, e.g. graffiti removal) consistent with the exterior appearance of
other similar facilities of comparable age and size in the vicinity, including,
when necessary, the exterior repainting of the Premises.

 

(b)                                 Lessee
shall, at Lessee’s sole cost and expense, procure and maintain a contract, with
copies to Lessor, in customary form and substance for and with a contractor
specializing and experienced in the inspection, maintenance and service of the
following equipment and improvements, if any, if and when installed in the
Premises: (i) the heating, air conditioning and ventilation system for the
Premises, (ii) boiler and pressure vessels, (iii) fire extinguishing systems,
including fire alarm and/or smoke detection, (iv) landscaping and irrigation
systems, (v) roof covering and drains, (vi) clarifiers, (vii) basic utility
feed to the perimeter of the Premises, and (viii) any other equipment, if
reasonably required by Lessor. All such contractors shall be subject to Lessor’s
prior approval, which approval shall not be unreasonably withheld. Lessee shall
make all repairs and replacements reasonably recommended by such contractors at
Lessee’s sole cost and expense. Alternatively, Lessee may perform the
inspection, maintenance and service of the equipment and improvements described
in subsections (i) through (viii) above in the same manner and level of care as
would be covered under a typical contract with a third party provider;
provided, however, that Lessor has the right to periodically inspect Lessee’s
performance of such services and if Lessor determines in two (2) consecutive
inspections that such equipment or improvements are not being property
maintained or Lessee fails to cure any problem with such equipment or
improvements discovered by Lessor within ten (10) days after Lessor’s delivery
of written notice to Lessee of such problem, Lessee shall no longer be
permitted to perform such maintenance services

 

10

 

 

and,
thereafter, shall procure and maintain a maintenance contract from a third
party contractor in accordance with the provisions of this Section. Lessee’s
right to perform such maintenance services is personal to the Original Lessee
and any Lessee’s Affiliate. However, Lessor reserves the right, upon notice to
Lessee, to procure and maintain any or all of such service contracts, and if
Lessor so elects, Lessee shall reimburse Lessor, upon demand, for the cost
thereof.

 

(c)                                  If Lessee fails to perform Lessee’s
obligations under this Paragraph 7.1, Lessor may enter upon the Premises after
ten (10) days’ prior written notice to Lessee (except in the case of an
emergency, in which case no notice shall be required), perform such obligations
on Lessee’s behalf, and put the Premises in good order, condition and repair,
in accordance with Paragraph 13.2 below.

 

(d)                                 Subject to Lessee’s indemnification of Lessor
as set forth in Paragraph 8.7 below, and without relieving Lessee of liability
resulting from Lessee’s failure to exercise and perform good maintenance
practices, if any capital improvements, repairs or expenditures (as determined
under Lessor’s sound accounting principles) (“Capital Expenditure”)
are required or necessary for operation of the Premises, including, without
limitation, any Capital Expenditure required under any Applicable Requirements,
Lessor shall complete such Capital Expenditure, provided that the cost of such
Capital Expenditure shall be amortized on a straight-line basis over its useful
life (as reasonably determined by Lessor), together with reasonable interest on
the unamortized balance, and such amortization shall be reimbursed by Lessee to
Lessor on a monthly basis during the Term on the date on which Base Rent is
due. Notwithstanding the foregoing, Lessee shall complete any Capital
Expenditure, at Lessee’s sole cost and expense, that is required as a result of
Lessee’s particular use of, or improvements to, the Premises.

 

7.2                                 Lessor’s Obligations. Subject to the provisions of Paragraphs 7.1
(d) (Capital Expenditures), 9 (Damage or Destruction) and 14 (Condemnation), it
is intended by the Parties hereto that Lessor have no obligation, in any manner
whatsoever, to repair and maintain the Premises, or the equipment therein, all
of which obligations are intended to be that of Lessee. It is the intention of
the Parties that the terms of this Lease govern the respective obligations of
the Parties as to maintenance and repair of the Premises, and they expressly
waive the benefit of any statute now or hereafter in effect to the extent it is
inconsistent with the terms of this Lease.

 

7.3                                 Utility Installations, Trade
Fixtures, Alterations.

 

(a)                                  Definitions; Consent Required. The term “Utility
Installations” is used in this Lease to refer to all air lines,
power panels, electrical distribution, security, fire protection systems,
communications systems, lighting fixtures, heating, ventilating and air
conditioning equipment, plumbing, and fencing in, on or about the Premises. The
term “Trade Fixtures” shall mean Lessee’s
machinery and equipment, which can be removed without doing damage to the
Premises. The term “Alterations”
shall mean any modification of the improvements on the Premises, which are
provided by Lessor under the terms of this Lease, other than Utility
Installations or Trade Fixtures. “Lessee-Owned Alterations
and/or Utility Installations” are defined as Alterations and/or
Utility Installations made by Lessee after the Effective Date that are not yet
owned by Lessor pursuant to Subparagraph 7.4 (a). Lessee shall not make nor
cause to be made any Alterations or Utility Installations in, on, under or
about the Premises without Lessor’s

 

11

 

prior written consent, which consent shall not be unreasonably withheld,
conditioned or delayed. Notwithstanding the foregoing, Lessee shall have the
right, without Lessor’s consent, but upon one (1) business day prior notice to Lessor to make non-structural
Alterations to the Premises in accordance with the terms of this Lease,
provided that such Alterations do not (i) affect the exterior of the Premises
or the Buildings (nor may such Alterations be visible from the exterior of such
Buildings), (ii) affect the Premises’ electrical, ventilation, plumbing,
elevator, mechanical, air conditioning or any other systems therein, or (iii)
exceed $250,000 per calendar year.

 

(b)                                 Consent. Any Alterations or Utility Installations that
Lessee shall desire to make and which require the consent of the Lessor shall
be presented to Lessor in written form with detailed plans. All consents given
by Lessor, whether by virtue of Subparagraph 7.3 (a) or by subsequent specific
consent, shall be deemed conditioned upon; (i) Lessee’s acquiring all
applicable permits required by governmental authorities; (ii) the furnishing of
copies of such permits together with a copy of the plans and specifications for
the Alteration or Utility Installation to Lessor prior to commencement of the
work thereon; and (iii) the compliance by Lessee with all conditions of said
permits in a prompt and expeditious manner. Any Alterations or Utility
Installations by Lessee during the Term of this Lease shall be done in a good
and workmanlike manner, with good and sufficient materials, and be in
compliance with all Applicable Requirements. Lessor’s approval of the plans,
specifications and working drawings for Lessee’s Alterations or Utility
Installations shall create no responsibility or liability on the part of Lessor
for their completeness, design sufficiency, or compliance with all laws, rules
and regulations of governmental agencies or authorities. All work with respect
to any Alterations or Utility Installations 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 the event that Lessee makes any Alterations or Utility Installations,
Lessee agrees to carry Special Form property insurance policy (formerly known
as “all risks”) in an amount approved by Lessor covering the construction of
such Alterations or Utility Installations, and such other insurance as Lessor
may require, it being understood and agreed that all of such Alterations or Utility Installations shall
be insured by Lessee pursuant to Article 8 of this Lease immediately upon
completion thereof. Upon completion of any Alterations or Utility
Installations, Lessee agrees to cause an Affidavit of Completion to be recorded
in the office of the Recorder of the county in which the Premises are located
in accordance with Section 53.106 of the Texas Property Code or any successor
statute and shall deliver to Lessor an endorsed, recorded copy of said Affidavit
of Completion and a reproducible copy of the “as built” drawings, and
specifications therefor of the Alterations or Utility Installations. Lessee
shall pay to Lessor all of Lessor’s actual, out-of-pocket costs incurred in
conjunction with Lessor’s third party consultant’s review of Lessee’s proposed
Alterations or Utility Installations within fifteen (15) days of Lessee’s
receipt of an invoice therefor.

 

(c)                                  Lien Protection. Lessee shall pay when due all claims for
labor or materials furnished or alleged to have been furnished to or for Lessee
at or for use on the Premises, which claims are or may be secured by any
mechanic’s or materialmen’s lien against the Premises or any interest therein.
Lessee shall give Lessor not less than ten (10) days’ notice prior to the
commencement of any work in, on, or about the Premises, and Lessor shall have
the right to post notices of non-responsibility in or on the Premises as
provided by law. If Lessee shall, in good faith, contest the validity of any
such lien, claim or demand, then Lessee shall, at its sole expense,

 

12

 

defend
and protect itself, Lessor and the Premises against the same and shall pay and
satisfy any such adverse judgment that may be rendered thereon before the
enforcement thereof against the Lessor or the Premises.

 

7.4                                 Ownership, Removal,
Surrender, and Restoration.

 

(a)                                  Ownership. Subject to Lessor’s right to require their
removal and to cause Lessee to become the owner thereof as hereinafter provided
in this Paragraph 7.4, all Alterations and Utility Installations made to the
Premises by Lessee shall be the property of and owned by Lessee, but considered
a part of the Premises. Lessor may, at its option at the time of giving its
consent, elect in writing to Lessee to be the owner of all or any specified
part of the Lessee-Owned Alterations and Utility Installations, other than
security systems. Unless otherwise instructed per Subparagraph 7.4 (b) hereof,
all Lessee-Owned Alterations and Utility Installations shall, at the expiration
or earlier termination of this Lease, automatically and without further action
on the part of Lessor, become the property of Lessor and remain upon the
Premises and be surrendered with the Premises by Lessee.

 

(b)                                 Removal. Unless otherwise agreed in writing, at the
time of giving its consent, Lessor may require that any or all Lessee-Owned
Alterations or Utility Installations be removed at the expiration or earlier
termination of this Lease. Concurrently with Lessee’s request for consent, Lessee may request that Lessor determine
whether such Lessee-Owned Alterations or Utility Installations will be required
to be so removed and if Lessor does not require such removal when consent is
given, Lessee shall not be obligated to remove the Lessee-Owned Alterations or
Utility Installations at the expiration or earlier termination of this Lease.
Lessor may require the removal at any time of all or any part of any
Alterations or Utility Installations made by or at the direction of Lessee
without the required consent of Lessor.

 

(c)                                  Surrender/Restoration. Lessee shall surrender the Premises by the
end of the last day of the Term or any earlier termination date, clean and free
of debris, with all Hazardous Materials removed from the Premises, and in good
operating order, condition and state of repair, normal wear and tear excepted.
Except as otherwise agreed or specified herein or as otherwise agreed by the
Parties during the Term, the Premises, as surrendered, shall include the Alterations
and Utility Installations. The obligation of Lessee shall include the repair of
any damage occasioned by the installation, maintenance or removal of Lessee’s
Trade Fixtures, furnishings, equipment, and Lessee-Owned Alterations and
Utility Installations, as well as the removal of any storage tank installed by
or for Lessee, and the removal, replacement, or remediation of any soil,
material or ground water contaminated by Lessee, all as may then be required by
Applicable Requirements and/or good practice. Lessee’s Trade Fixtures and other
personal property shall remain the personal property of Lessee and shall be
removed by Lessee subject to its obligation to repair and restore the Premises
per this Lease.

 

8.                                       Insurance; Indemnity.

 

8.1                                 Lessor’s Insurance. Lessor shall maintain “causes of loss -
special form” property insurance covering the Premises against loss or damage
resulting from fire and other insurable loss. Such insurance shall be on a 100%
replacement cost basis. As reasonably determined

 

13

 

by
Lessor and subject to Lessee’s reimbursement of such costs in accordance with
the terms of this Paragraph 8.1, Lessor shall also carry earthquake, terrorism,
windstorm and/or other insurance covering the Premises. Lessor shall have the
right to obtain flood insurance if the Premises is located within a 100-Year
Flood Plain or in an identified “flood prone area” as classified by the U.S.
Department of Housing and Urban Development or if required by any lender
holding a security interest in the Premises, Lessor shall not obtain insurance
for Lessee’s fixtures or equipment or building improvements installed by Lessee
on the Premises, including Trade Fixtures and Lessee-Owned Alterations and/or
Utility Installations. During the Term, Lessor shall also maintain a rental
income insurance policy, with loss payable to Lessor, in an amount not to
exceed eighteen (18) months of Base Rent, plus estimated real property taxes
and insurance premiums, Lessee shall be liable for the payment of any
commercially reasonable deductible amount under Lessor’s insurance policies
maintained pursuant to this Paragraph 8.1 and any commercially reasonable
self-insured retention amount. Lessee shall not do or permit anything to be
done which invalidates any such insurance policies. Lessee shall pay all
premiums for the insurance policies described in this Paragraph 8.1 within
fifteen (15) days after Lessee’s receipt of a copy of the premium statement or
other evidence of the amount due except Lessor shall pay all premiums for
non-primary comprehensive public liability insurance which Lessor elects to
obtain. If the Term expires before the expiration of an insurance policy
maintained by Lessor, Lessee shall be liable for Lessee’s prorated share of the
insurance premiums.

 

8.2                                 Lessee’s Insurance. At all times during the Term of this Lease,
Lessee will purchase and maintain, at Lessee’s sole expense, the following
insurance, in amounts not less than those specified below or such other amounts
as Lessor may from time to time reasonably request, with insurance companies
and on forms satisfactory to Lessor.

 

(a)                                  Commercial General Liability Insurance
written on an I.S.O. “occurrence” form or its equivalent covering the use,
occupancy and maintenance of the Premises and operations of Lessee. Such
coverage shall include Premises Operations; Independent Contractors; Products -
Completed Operations; Broad Form Property Damage; Blanket Contractual
Liability, Personal and Advertising Injury; Fire Legal Liability; Employees
Named as Additional Insureds; and Severability. Limits for such coverage shall
be Bodily Injury and Property Damage Combined Single Limit of $3,000,000 per
Occurrence with a $5,000,000 General Aggregate, Products and Completed Operations
Aggregate of $2,000,000, Personal and Advertising Injury of $1,000,000 Per Person/Organization
subject to $2,000,000 General Aggregate, and Fire Legal Liability of $1,000,000
Any One Fire subject to $3,000,000 General Aggregate. The policy shall contain
an endorsement specifically naming the following as additional insureds: (1)
Lessor and (2) Westcore Properties, LLC, and its officers and employees, with
respect to the Lessee’s use, occupancy or maintenance of the Premises. The
policy shall also contain an endorsement amending the “Other Insurance” clause
as follows: “The insurance afforded to Additional Insureds under this policy is
primary insurance and the insurer will not seek contribution from other
insurance available to the Additional Insureds.” The policy shall contain a
waiver of subrogation endorsement.

 

(b)                                 Umbrella Liability Insurance to be excess
over the Commercial General Liability, Automobile Liability and Employers’
Liability Insurance. The Umbrella Liability policy shall be written on an “occurrence”
form with a limit of liability of Twenty-Five Million Dollars

 

14

 

($25,000,000.00)
and a Self-Insured Retention in an amount which is commercially reasonable, in
Lessor’s reasonable judgment, based upon Lessee’s net worth in relationship to
then outstanding rental obligation payable under this Lease, but in all events
no greater than One Million Dollars ($1,000,000.00). The policy shall contain
an endorsement naming the following as additional insureds following the form
of the underlying Commercial General Liability and Automobile Liability
policies: (i) Lessor and (ii) Westcore Properties, LLC, and their officers and
employees. The policy shall also contain an endorsement amending the “Other Insurance”
clause as follows: “Subject to the terms and conditions of this policy, the
insurance afforded to Additional Insureds, (1) Lessor and (2) Westcore
Properties, LLC, under this policy shall be considered to be primary to any
insurance they may have in force which also applies to a loss covered hereunder
and, further, the insurer shall not seek contribution from other insurance
available to the Additional Insureds.” The policy shall contain a waiver of
subrogation endorsement.

 

(c)                                  Commercial Property Insurance covering all of
Lessee’s furniture, fixtures, machinery, equipment, stock and any other
personal property owned and/or used in Lessee’s business, including Trade
Fixtures and Lessee-Owned Alterations and/or Utility Installations, in an
amount equal to their full replacement cost without deduction for depreciation.
At a minimum, such policy shall insure against destruction or damage by fire
and other perils covered on an ISO Causes of Loss - Special Form including wind
and hurricane. Such policy shall further provide Replacement Cost Coverage.
Such policy shall contain a commercially reasonable deductible, as reasonably
determined by Lessor; however, so long as the tenant under this Lease is Lessee
as initially named herein, the deductible shall not exceed Five Million Dollars
($5,000,000.00). Lessee, with all reasonable speed, will use all proceeds of
such insurance, so long as this lease remains in effect, for rebuilding,
repairing, replacing or otherwise reinstating the improvements and all other fixed
property Lessee is responsible for repairing in a good and substantial manner
pursuant to applicable building laws and codes and the plan as shall have been
approved in writing by Lessor. Lessee will make up from its own funds any
deficiency in such insurance proceeds. Further, the policy shall contain a
provision specifically naming the following as additional insureds as their
interest may appear: (i) Lessor and (ii) Westcore Properties, LLC.

 

(d)                                 Business Income and/or Extra Expense
Insurance in an amount sufficient to insure payment of Rent and all other
expenses to be borne by Lessee under this Lease, for a period of not less than
Twelve (12) months, during any interruption of Lessee’s business by reason of
the Premises or personal property being damaged by fire or other perils covered
on an ISO Causes of Loss - Special Form or its equivalent. In addition, such
coverage shall be written on an Agreed Amount Basis.

 

(e)                                  Automobile Liability Insurance to include
coverage for any owned, non-owned or hired automobiles entering and exiting
from the Premises and automobile contractual liability with limits of:
$1,000,000 per occurrence and Basic No-Fault coverage as required by law or
regulation if any, in the State in which the Premises is located.

 

(f)                                    Workers’ Compensation coverage shall be
carried as required by law in the State in which the employees are hired and to
further include: Voluntary Compensation Coverage and Other States’ Coverage, if
applicable, with statutory limits for Workers’ Compensation and limits

 

15

 

for
Employers’ Liability of; $1,000,000 Each Accident: $1,000,000 Disease - Policy
Limit; and $1,000,000 Disease - Each Employee.

 

8.3                                 General Requirements.

 

(a)                                  Certificates of Insurance, in a generally
accepted industry standard format, evidencing all such insurance and reasonably
acceptable to the Lessor shall be filed with Lessor prior to occupancy of the
Premises and at least ten (10) days prior to the expiration of the term of each
policy thereafter. Such Certificates of Insurance must specifically show all
the special policy conditions required in this Article including “additional
insured”, “waiver of subrogation”, “notice of cancellation”, and “primary
insurance” wording applicable to each policy. Alternatively, a certified, true
and complete copy of each properly endorsed policy may be submitted.

 

(b)                                 All coverage shall be written by an admitted
insurer in the State in which the Premises is located with a current Best
Rating of A-10 or better.

 

(c)                                  All insurance policies required hereunder
shall be specifically endorsed to state that coverages afforded under the
policies will not be cancelled or allowed to expire for non-payment of premiums
until at least 10 days’ prior written notice has been mailed to Lessor or for
any other reason until at least 30 days’ prior written notice has been mailed
to the Lessor. The Certificate of Insurance for each policy must state the
foregoing written notice requirements.

 

(d)                                 If the limits of available liability coverage
required herein become substantially reduced as a result of claim payments,
Lessee shall immediately, at its own expense, purchase insurance to reinstate
the limits of liability coverage required by this Lease.

 

(e)                                  Lessee shall not settle any claim or accept
any proceeds in satisfaction of any claim involving damage to the Premises or
liability of Lessor without Lessor’s express prior written consent.

 

(f)                                    Lessee may maintain the insurance required
under this Paragraph under blanket or umbrella policies, as applicable, issued
to Lessee covering other properties owned or leased by Lessee; provided that
the policies otherwise comply with this Paragraph and allocate to the Premises
the coverage specified by this Paragraph, without possibility of reduction or
coinsurance penalty by reason of, or damage to, any other properties named
therein, and if the insurance required by this Paragraph shall be effected by
any such blanket or umbrella policies, Lessee shall furnish to Lessor certified
copies of policies with schedules thereto attached showing the amount of
insurance afforded by such policies to the Premises.

 

(g)                                 Lessor at its option may obtain any of the
required insurance directly or through blanket or umbrella policies covering
the Premises and other assets owned by Lessor.

 

8.4                                 Adequacy of Coverage. Lessor, its agents and employees, make no representation
that the limits of liability specified to be carried by Lessee pursuant to this
Paragraph are adequate to protect Lessee. If Lessee believes that any of such
insurance coverage is inadequate, Lessee will obtain such additional insurance
coverage as Lessee deems adequate, at Lessee’s sole expense.

 

16

 

8.5                                 Reservation of Rights - Changes. Lessor has the right at any time, but not
the obligation, to reasonably change, decrease or increase any insurance
required or specified to be maintained by Lessee under this Lease consistent
with the insurance requirements of other prudent landlords owning comparable
properties in the area in which the Premises are located. Lessee shall add as
additional insureds to the insurance policies required by this Paragraph such
other persons as Lessor may from time to time reasonably require.

 

8.6                                 Waiver of Subrogation. Lessor and Lessee each hereby waives, on
their behalf and on behalf of their respective insurance carriers, any claim
which either party might otherwise have against the other party, arising out of
loss or damage, including consequential loss or damage, to any property of such
party from any risk required to be insured against hereunder. Lessor and Lessee
shall each indemnify the other against any loss or expense, including
reasonable attorneys’ fees, resulting from the failure of either party, respectively,
to obtain the waivers required by this Paragraph 8.6.

 

8.7                                 Indemnity.

 

(A)                               INDEMNIFICATION OF LESSOR. EXCEPT
FOR LESSOR’S GROSS NEGLIGENCE AND/OR WILLFUL MISCONDUCT OR BREACH OF EXPRESS
WARRANTIES, LESSEE SHALL INDEMNIFY, PROTECT, DEFEND AND HOLD HARMLESS THE
PREMISES, LESSOR AND ITS AGENTS, EMPLOYEES, OFFICERS, INDEPENDENT CONTRACTORS,
LESSOR’S MASTER OR GROUND LESSOR, PARTNERS AND ANY HOLDERS OF ANY MORTGAGES OR
DEEDS OF TRUST ON THE PREMISES (“LENDERS”), FROM AND AGAINST ANY AND ALL
CLAIMS, LOSS OF RENTS AND/OR DAMAGES, COSTS, LIENS, JUDGMENTS, PENALTIES, LOSS
OF PERMITS, REASONABLE ATTORNEYS’ AND CONSULTANTS’ FEES, EXPENSES AND/OR
LIABILITIES ARISING OUT OF, INVOLVING, OR IN CONNECTION WITH, THE OCCUPANCY OF
THE PREMISES BY LESSEE, THE CONDUCT OF LESSEE’S BUSINESS, ANY ACT, OMISSION OR
NEGLECT OF LESSEE, ITS AGENTS, CONTRACTORS, EMPLOYEES OR INVITEES, AND OUT OF
ANY DEFAULT OR BREACH BY LESSEE IN THE PERFORMANCE IN A TIMELY MANNER OF ANY
OBLIGATION ON LESSEE’S PART TO BE PERFORMED UNDER THIS LEASE. THE FOREGOING
SHALL INCLUDE, BUT NOT BE LIMITED TO, THE DEFENSE OR PURSUIT OF ANY CLAIM OR
ANY ACTION OR PROCEEDING INVOLVED THEREIN, AND WHETHER OR NOT (IN THE CASE OF
CLAIMS MADE AGAINST LESSOR) LITIGATED AND/OR REDUCED TO JUDGMENT. IN CASE ANY
ACTION OR PROCEEDING BE BROUGHT AGAINST LESSOR BY REASON OF ANY OF THE
FOREGOING MATTERS, LESSEE, UPON WRITTEN NOTICE FROM LESSOR, SHALL DEFEND THE
SAME AT LESSEE’S EXPENSE BY COUNSEL REASONABLY SATISFACTORY TO LESSOR AND
LESSOR SHALL COOPERATE WITH LESSEE IN SUCH DEFENSE. LESSOR NEED NOT HAVE FIRST
PAID ANY SUCH CLAIM IN ORDER TO BE SO INDEMNIFIED. LESSEE’S OBLIGATIONS UNDER
THIS PARAGRAPH SHALL SURVIVE THE EXPIRATION OR TERMINATION OF THIS LEASE UNLESS
SPECIFICALLY WAIVED IN WRITING BY LESSOR.

 

LESSEE’S INITIALS:                                

 

17

 

(b)                                 Indemnification of Lessee. Except to the
extent caused by Lessee’s gross negligence and/or willful misconduct or breach
of express warranties, Lessor shall indemnify, protect, defend and hold
harmless Lessee from all damages arising from (a) Lessor’s gross negligence,
willful misconduct or breach of this Lease, or (b) Lessor’s violation of any
law relating to the Premises (excluding, however, any law which is Lessee’s responsibility
to comply with under the provisions of this Lease, including, without
limitation, the Applicable Requirements described in Paragraph 6.3 of this
Lease). In the event any action or proceeding be brought against Lessee by
reason of the foregoing matters, Lessor, upon written notice from Lessee, shall
defend the same at Lessor’s expense by counsel reasonably satisfactory to
Lessee and Lessee shall cooperate with Lessor in such defense. Lessee need not
have first paid any such claim in order to be so indemnified. Lessor’s
obligations under this Paragraph shall survive the expiration or termination of
this Lease unless specifically waived in writing by Lessee.

 

8.8                                 Exemption of Lessor from Liability. Except
for injuries or damages caused by Lessor’s gross negligence and/or willful
misconduct, Lessor shall not be liable for injury or damage to the person or
goods, wares, merchandise or other property of Lessee’s employees, contractors,
invitees, customers, or any other person in or about the Premises, whether such
damage or injury is caused by or
results from fire, steam, electricity, gas, water or rain, or from the
breakage, leakage, obstruction or other defects of pipes, fire sprinklers,
wires, appliances, plumbing, air conditioning or lighting fixtures, or from any
other cause, whether said injury or damage results from conditions arising upon
the Premises, from other sources or places, and regardless of whether the cause
of such damage or injury or the means of repairing the same is accessible or not.
Lessor shall not be liable for any damages arising from any act or neglect of
any other lessee of Lessor nor from the failure by Lessor to enforce the
provisions of any other lease in the project of which the Premises are a part.
Notwithstanding anything to the contrary contained in this Lease, in no event
shall Lessor be liable under any circumstances for any consequential damages,
including, without limitation, injury to Lessee’s business or for any loss of
income or profit therefrom.

 

8.9                                 Failure to Provide Insurance. Following
Lessor’s delivery of prior written notice to Lessee, Lessor shall have the
right and option, but not the obligation, to maintain any or all of the
insurance which is required in this Paragraph 8 to be provided by Lessee if
Lessee fails to maintain the insurance required of Lessee in this Paragraph 8.
All costs of Lessee’s insurance provided by the Lessor shall be obtained at
Lessee’s expense.

 

9.                                       Damage or Destruction.

 

9.1                                 Definitions.

 

(a)                                  “Premises Partial Damage” shall mean damage
or destruction to the Premises, other than Lessee-Owned Alterations and Utility
Installations, which can reasonably be repaired in 365 days or less from the
damage or destruction. Lessor shall notify Lessee in writing within sixty (60)
days after the date of the damage or destruction as to whether or not the
damage is Partial or Total.

 

(b)                                 “Premises Total Destruction” shall mean
damage or destruction to the Premises, other than Lessee-Owned Alterations and
Utility Installations, which cannot be

 

18

 

reasonably
repaired in 365 days or less from the date of the damage or destruction. Lessor
shall notify Lessee in writing within sixty (60) days after the date of the
damage or destruction as to whether or not the damage is Partial or Total.

 

(c)                                  “Insured Loss” shall mean damage or destruction to the
Premises, other than Lessee-Owned Alterations and Utility Installations and
Trade Fixtures, which was caused by an event required to be covered by the
insurance described in Paragraph 8 irrespective of any deductible amounts or
coverage limits involved, and where adequate insurance proceeds are available
to Lessor for the reconstruction of the Premises.

 

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

 

9.2                                 Premises Partial Damage -
Insured Loss. If Premises
Partial Damage occurs, and such damage or destruction is an Insured Loss, then
Lessor shall, at Lessor’s expense, repair such damage (but not Lessee’s Trade
Fixtures or Lessee-Owned Alterations and Utility Installations) as soon as
reasonably possible and this Lease shall continue in full force and effect. If
there is a shortage in insurance proceeds, Lessor agrees to pay up to
$150,000.00 per damaged Building of such shortage (“Lessor’s Agreed Amount”). In the event, however, that there
is a shortage of insurance proceeds available to Lessor in excess of Lessor’s
Agreed Amount, Lessor shall have no obligation to pay for such shortage in
insurance proceeds in excess of Lessor’s Agreed Amount or to fully restore the
unique aspects of the Premises unless Lessee provides Lessor with the funds to
cover same, or adequate assurance thereof, within ten (10) days following
receipt of written notice of such shortage and request therefor. If Lessor
receives said funds or adequate assurance thereof within said ten (10) day
period, Lessor shall complete them as soon as reasonably possible and this
Lease shall remain in full force and effect. If Lessor does not receive such
funds or assurance within said period. Lessor may nevertheless elect by written
notice to Lessee within ten (10) days thereafter to make such restoration and
repair as is commercially reasonable with Lessor paying any shortage in
proceeds over Lessor’s Agreed Amount, in which case this Leases shall remain in
full force and effect. If Lessor does not receive such funds or assurance
within such ten (10) day period, and if Lessor does not so elect to restore and
repair, then this Lease shall terminate sixty (60) days following the
occurrence of the damage or destruction. Unless otherwise agreed, Lessee shall
in no event have any right to reimbursement from Lessor for any funds
contributed by Lessee to repair any such damage or destruction. Premises
Partial Damage due to flood or earthquake shall be subject to Paragraph 9.3
rather than this Paragraph 9.2, notwithstanding that there may be some
insurance coverage, but the net proceeds of any such insurance shall be made
available for the repairs if made by either Party.

 

9.3                                 Partial Damage - Uninsured Loss. If Premises Partial Damage occurs, such
damage or destruction is not an Insured Loss and the cost to repair exceeds
Lessor’s Agreed Amount, then unless such damage or destruction was caused by a
negligent or willful act of Lessee (in which the event Lessee shall make the
repairs at Lessee’s expense and this Lease shall continue in full force and
effect), Lessor may at Lessor’s option, either (i) repair such damage as soon
as reasonably possible at Lessor’s expense, in which event this Lease shall
continue in full force and

 

19

 

effect,
or (ii) give written notice to Lessee within sixty (60) days after receipt by
Lessor of knowledge of the occurrence of such damage of Lessor’s desire to
terminate this Lease as of the date sixty (60) days following the date of such
notice. In the event Lessor elects to give such notice of Lessor’s intention to
terminate this Lease, Lessee shall have the right within ten (10) days after
the receipt of such notice to give written notice to Lessor of Lessee’s
commitment to pay for the cost to repair such damage in excess of Lessor’s
Agreed Amount totally at Lessee’s expense and without reimbursement from Lessor
(except that Lessor shall pay Lessor’s Agreed Amount). Lessee shall provide
Lessor with the required funds or satisfactory assurance thereof within thirty
(30) days following such commitment from Lessee. In such event this Lease shall
continue in full force and effect, and Lessor shall proceed to make such
repairs as soon as reasonably possible after the required funds are available.
If Lessee does not give such notice and provide the funds or assurance thereof
within in the times specified above, this Lease shall terminate as of the date
specified in Lessor’s notice of termination. Notwithstanding the foregoing, if
the cost to repair any damage to the Premises does not exceed Lessor’s Agreed
Amount, then unless such damage or destruction was caused by a negligent or
willful act of Lessee (in which the event Lessee shall make the repairs at
Lessee’s expense and this Lease shall continue in full force and effect),
Lessor shall repair such damage as soon as reasonably possible at Lessor’s
expense.

 

9.4                                 Total Destruction. Notwithstanding any other provision hereof,
if Premises Total Destruction occurs (including any destruction required by any
authorized public authority), then either Party may elect to terminate this
Lease by giving thirty (30) days written notice to the other within sixty (60)
days following the date of such Premises Total Destruction, whether or not the
damage or destruction is an Insured Loss or was caused by a negligent or
willful act of Lessee. In the event, however, that the damage or destruction
was caused by Lessee, Lessor shall have the right to recover Lessor’s damages
from Lessee, except as released and waived in Paragraph 8.6 of this Lease.

 

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

 

20

 

9.6                                 Abatement of Rent; Lessee’s Remedies. 

 

(a)                                  In the event of Premises Partial Damage, the
Base Rent and other charges, if any, payable by Lessee hereunder for the period
during which such damage or condition, its repair, remediation or restoration
continues, shall be abated in proportion to the degree to which, in Lessor’s
good faith reasonable business judgment, Lessee’s use of the Premises is
impaired. Except for abatement of Base Rent and other charges, if any, as
aforesaid, all other obligations of Lessee hereunder shall be performed by
Lessee, and Lessee shall have no claim against Lessor for any damage suffered
by reason of any such damage, destruction, repair, remediation or restoration.

 

(b)                                 If Lessor is obligated to repair or restore
the Premises under the provisions of this Paragraph 9 and does not commence the
repair or restoration of the Premises within one hundred twenty (120) days
after either (i) such obligation shall accrue, or (ii) receipt of all applicable insurance proceeds, whichever time
period is greater, then Lessee may, at any time prior to the commencement of
such repair or restoration, give written notice to Lessor of Lessee’s election
to terminate this Lease on a date not less than sixty (60) days following the
giving of such notice. If Lessee gives such notice to Lessor and such repair or
restoration is not commenced within sixty (60) days after receipt of such
notice, this Lease shall terminate as of the date specified in said notice. If
Lessor commences the repair or restoration of the Premises within sixty (60)
days after the receipt of such notice, this Lease shall continue in full force
and effect. “Commence” as used in
this Paragraph 9.6 shall mean either the authorization of the preparation of
the required plans, or the beginning of the actual work on the Premises,
whichever occurs first.

 

9.7                                 Lessee’s Termination Right. If Lessor does not elect to terminate this
Lease under the terms of this Section 9, but the damage required to be repaired
by Lessor is not repaired within the period ending three hundred sixty-five
(365) days after the damage or destruction (the “One Year Period”) (subject to extension for any delay
caused by 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 Lessor, provided that in no event shall such extension
exceed 90 days), then Lessee (subject to the provisions of this Paragraph 9.7),
within thirty (30) days after the end of such One Year Period, may terminate
this Lease by written notice to Lessor, in which event this Lease shall
terminate as of the date of receipt of the notice. Notwithstanding the
foregoing, if Lessor is proceeding to complete the repair of such damage, then
Lessee shall not have the right to terminate this Lease if, prior to the
expiration of the One Year Period, Lessor, at Lessor’s sole option, gives
written notice to Lessee that the repairs will be completed within thirty (30)
days after the end of such One Year Period, and the repairs are actually
completed within such thirty (30) day period. If the repairs are not completed
within thirty (30) days after the end of such One Year Period, then Lessee may
terminate this Lease by written notice to the Lessor. Such notice of termination
shall be given within sixty (60) days after the end of such One Year Period,
and shall be effective upon receipt thereof by Lessor. Notwithstanding the
provisions of this Paragraph 9.7, Lessee shall have the right to terminate
this Lease under this Paragraph 9.7 only if each of the following conditions is
satisfied: (a) the damage to the Premises is by fire or other casualty was not
caused by the gross negligence or willful misconduct of Lessee or its partners,
trustees, officers, directors, shareholders, members, beneficiaries, licensees,
invitees, or any sublessees or sublessees’ agents, employees, contractors, or
invitees, servants, guests or independent contractors; and (b) there is no
Breach then in effect.

 

21

 

9.8.                              Termination - Advance
Payments. Upon termination
of this Lease pursuant to this Paragraph 9, Lessor shall return to Lessee any
advance payment made by Lessee to Lessor as has not been or is not then
required to be, used by Lessor under the terms of this Lease.

 

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

 

10.                                 Real Property Taxes.

 

10.1                           Payment of Taxes. In addition to Base Rent, Lessee shall pay to
Lessor all Real Property Taxes relating to the term of this Lease. Lessor shall
estimate the current Real Property Taxes and require that such taxes be paid to
Lessor by Lessee monthly in advance with the payment of the Base Rent. Such
monthly payments shall be an amount equal to the amount of the estimated
installment of taxes divided by the number of months remaining before the month
in which said installment becomes delinquent. When the actual amount of the
applicable tax bill is known, the amount of such equal monthly advance payment
s shall be adjusted as required to provide the funds needed to pay the
applicable taxes. If the amount collected by Lessor is insufficient to pay such
Real Property Taxes when due, Lessee shall pay Lessor, upon demand, such
additional sum as is necessary. Advance payment may be intermingled with other
moneys of Lessor and shall not bear interest. 

 

10.2                           Real Property Tax Definition. As used herein, the term “Real Property Taxes” shall include any
form of real estate tax or assessment, general, special, ordinary or
extraordinary, and any license fee, commercial rental tax, improvement bond or
bonds, levy or tax (other than inheritance, personal income or estate taxes)
imposed upon the Premises by any authority having the direct or indirect power
to tax, including any city, state or federal government, or any school, agricultural,
sanitary, fire, street, drainage, or other improvement district thereof, levied
against any legal or equitable interest of Lessor in the Premises or any
portion thereof, Lessor’s right to rent or other income therefrom, and/or
Lessor’s business of leasing the Premises, The term “Real Property Taxes” shall also include any tax, fee, levy,
assessment or charge, or any increase therein, imposed by reason of events
occurring, or changes in Applicable Requirements taking effect, during the Term
of this Lease, including but not limited to a change in the ownership of the
Premises or in the improvements thereon, the execution of this Lease, or any
modification, amendment or transfer thereof, and whether or not contemplated by
the Parties. In calculating Real Property Taxes for any calendar year, the Real
Property Taxes for any real estate tax year shall be included in the
calculation of Real Property Taxes for such calendar year based upon the number
of days, which such calendar year and tax year have in common. Each year, at
Lessor’s election, Lessor may protest real property assessments. In the event
Lessor elects to protest a real property tax assessment, Lessor may utilize the
services of a tax consultant to protest the real property tax assessment. If as
a result of the protest, the Real Property Taxes are lowered, and a tax
consultant has been utilized in connection with the protest, Lessee agrees to
pay, as additional rent during the Term, all fees payable to tax consultants in
the manner set forth in this Lease, as long as there is a net benefit to Lessee
from such lowering of Real Property Taxes.

 

22

 

10.3                           Additional Improvements. Notwithstanding Paragraph 10.1 hereof, Lessee
shall, however, pay to Lessor at the time Real Property Taxes are paid under
this Lease, the entirely of any increase in Real Property Taxes if assessed
solely by reason of Alterations, Trade Fixtures or Utility Installations placed
upon the Premises by Lessee or at Lessee’s request.

 

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

 

10.5                           Lessee’s Property Taxes. Lessee shall pay, prior to delinquency, all
taxes assessed against and levied upon Lessee-Owned Alterations and Utility
Installations, Trade Fixtures, furnishings, equipment and all personal property
of Lessee contained or stored in the Premises. When possible, Lessee shall
cause its Lessee-Owned Alterations and Utility Installations, Trade Fixtures,
furnishings, equipment and all other personal property to be assessed and
billed separately from the real property of Lessor. If any of Lessee’s said
property shall be assessed with Lessor’s real property, Lessee shall pay Lessor
the taxes attributable to Lessee’s property within fifteen (15) days after
receipt of a written statement setting forth the taxes applicable to Lessee’s
property.

 

11.                                Utilities. Lessee shall pay directly for all utilities
and services supplied to the Premises, including but not limited to
electricity, telephone, security, gas and cleaning of the Premises, together
with any taxes thereon. There shall be no abatement of rent and Lessor shall
not be liable in any respect whatsoever for the inadequacy, stoppage,
interruption or discontinuance of any utility or service.

 

12.                                Assignment and Subletting.

 

12.1                           Lessor’s Consent Required.

 

(a)                                  Lessee shall not voluntarily or by operation
of law assign, transfer, mortgage or otherwise transfer or encumber
(collectively, “assign” or “assignment”) or sublet all or any part of Lessee’s
interest or obligations in this Lease or in the Premises without Lessor’s prior
written consent given under and subject to the terms of Paragraph 36, which
Lessor shall not withhold unreasonably. The parties agree, however, that the
manner of operation of the Premises and conduct of business thereon by Lessee
will have an impact on the quality and reputation of the Premises. Accordingly,
the parties agree that in approving or disapproving of any proposed assignment
or subletting of the Premises or the Lease, Lessor shall be entitled to take
into consideration, by way of example and not limitation, any or all of the
criteria set forth below and that it shall not be unreasonable for Lessor to
withhold its consent if any of the following circumstances exist or may exist;
(i) the transferee’s contemplated use of the Premises following the proposed
assignment or subletting is different from the permitted use specified herein;
(ii) in Lessor’s reasonable business judgment, the transferee lacks sufficient
business reputation or experience to operate a successful business of the type
and quality permitted under the Lease; (iii)
the present net worth of any assignee of the entire Lease is less than
$200,000,000; (iv) the proposed assignment or subletting would breach any
covenant of Lessor in any other lease,

 

23

 

financing
agreement or other agreement relating to the Premises or otherwise; or (v) the
transferee requests an amendment to the Lease other than the identity of
Lessee. No assignment or subletting shall release Lessee from its obligations
and liabilities hereunder. Notwithstanding the foregoing and subject to the
provisions of subsection (c) below, Lessee may assign this Lease or sublease
the Premises (“Permitted Transfers”), without
Lessor’s consent but upon ten (10) days prior notice to Lessor, to any
corporation which controls, is controlled by or is under common control with
Lessee, or to any corporation resulting from the merger of or consolidation
with Lessee (“Lessee’s Affiliate”). In
such case, any Lessee’s Affiliate shall assume in writing all of Lessee’s
obligations under this Lease.

 

(b)                                 A “Change of Control” of Lessee shall constitute an assignment
requiring Lessor’s consent. Change of Control shall mean the transfer by sale,
assignment, death, incompetency, mortgage, deed of trust, trust, operation of
law, or otherwise, of any shares, voting rights or ownership interest which
will result in a change in the identity of the entity, entities, person or
persons exercising, or who may exercise, effective control of Lessee, unless
such change results from the trading of shares listed on a recognized public
stock exchange and such trading is not for the purpose of acquiring effective
control of Lessee, excluding, however, Permitted Transfers. If Lessee is a
private corporation whose stock becomes publicly held, the transfers of such
stock from private to public ownership shall not be deemed a Change of Control.
The transfer, on a cumulative basis, of fifty percent (50%) or more of the
voting control of Lessee shall constitute a change in control for this purpose.

 

(c)                                  The involvement of Lessee or its assets in
any transaction, or series of transactions (by way of merger, sale,
acquisition, financing, refinancing, transfer, leveraged buy-out or otherwise),
whether or not a formal assignment or hypothecation of this Lease or Lessee’s
assets occurs, which results in Lessee’s Net Worth, as hereinafter defined,
being less than $150,000,000, shall be considered an assignment of this Lease
by Lessee to which Lessor may reasonably withhold its consent. “Net Worth” of Lessee for purposes of this
Lease shall be the book net worth of Lessee (without any credit for goodwill
and excluding any guarantors) established under generally accepted accounting
principles consistently applied.

 

(d)                                 An assignment or subletting of Lessee’s
interest in this Lease without Lessor’s specific prior written consent shall be
a Default under this Lease.

 

12.2                           Terms and Conditions
Applicable to Assignment and Subletting.

 

(a)                                  Regardless of Lessor’s consent, any
assignment or subletting shall not (i) be effective without the express written
assumption by such assignee or sublessee of the obligations of Lessee under this Lease, (ii) release Lessee of
any obligations hereunder, nor (iii) alter the primary liability of Lessee for
the payment of Base Rent and other sums due Lessor hereunder or for the
performance of any other obligations to be performed by Lessee under this
Lease.

 

(b)                                 Lessor may accept any rent or performance of
Lessee’s obligations from any person other than Lessee pending approval or
disapproval of an assignment. Neither a delay in the approval or disapproval of
such assignment nor the acceptance of any rent for

 

24

 

performance
shall constitute a waiver or estoppel of Lessor’s right to exercise its
remedies for the Default or Breach by Lessee of any of the terms, covenants or
conditions of this Lease.

 

(c)                                  The consent of Lessor to any assignment or
subletting shall not constitute consent to any subsequent assignment or
subletting by Lessee or to any subsequent or successive assignment or
subletting by the assignee or sublessee. However, Lessor may consent to
subsequent sublettings and assignments of the sublease or any amendments or
modifications thereto without notifying Lessee or anyone else liable under this
Lease or the sublease and without obtaining their consent.

 

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

 

(e)                                  Should Lessee desire to enter into an
assignment or subletting transaction, Lessee shall give notice thereof to Lessor
by requesting in writing Lessor’s consent to such assignment or subletting at
least thirty (30) days before the proposed effective date of any such
assignment or subletting and shall provide Lessor with the following: (i) the
full particulars of the proposed assignment or subletting transaction,
including its nature, effective date, terms and conditions, and copies of any
documents pertaining to such proposed transaction; (ii) a description of the
identity, net worth and previous business experience of the transferee,
including, without limitation, copies of transferee’s latest income, balance
sheet and change-of-financial-position statements (with accompanying notes and
disclosures of all material changes thereto) in audited form, if available, and
certified as accurate by the transferee; and (iii) any further information
relevant to the transaction which Lessor shall have requested within thirty
(30) days after receipt of Lessee’s request for consent and all information
specified above in Subparagraphs (i), (ii) and (iii).

 

Each
assignment or subletting to which Lessor has consented shall be evidenced by an
instrument made in such written form as is satisfactory to Lessor and executed
by Lessee and transferee. By such instrument, transferee shall assume all the
terms, covenants and conditions of this Lease, which are obligations of Lessee.
Lessee shall remain fully liable to perform its duties under the Lease
following the assignment or subletting. Lessee shall, on demand of Lessor,
reimburse Lessor for Lessor’s reasonable costs, including legal fees up to a
maximum of $2,000, incurred in obtaining advice and preparing documentation for
each assignment or subletting to which Lessor has consented.

 

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

 

25

 

(g)                                 If Lessor consents to an assignment or
subletting, as a condition thereto which the parties hereby agree is
reasonable, Lessee shall pay to Lessor fifty percent (50%) of any “Transfer Premium,” as that term is defined
in this subparagraph, received by Lessee from such assignee or sublessee. “Transfer Premium” shall mean all rent,
additional rent or other consideration payable by the assignee or sublessee in
connection with the assignment or sublease in excess of the Base Rent under
this Lease during the term of the assignment or sublease on a per rentable
square foot basis if less than all of the Premises is transferred, deducting
any expenses incurred by Lessee in connection with the assignment or
subletting, including without limitation, expenses of marketing brokerage
commissions and reasonable attorneys’ fees, but excluding expenses incurred in
improving the space or loss of rent. “Transfer Premium” shall also include, but
not be limited to, key money, bonus money or other cash consideration paid by such
assignee or sublessee to Lessee in connection with such assignment or sublease.
The determination of the amount of Lessor’s applicable share of the Transfer
Premium shall be made on a monthly basis as rent or other consideration is
received by Lessee under the assignment or sublease.

 

(h)                                 Intentionally Deleted.

 

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

 

(a)                                  Lessee hereby assigns and transfers to Lessor
all of Lessee’s interest in all rentals and income arising from any sublease of
all or a portion of the Premises heretofore or hereafter made by Lessee, and
Lessor may collect such rent and income and apply same toward Lessee’s
obligations under this Lease; provided, however, that until a Breach shall
occur in the performance of Lessee’s obligations under this Lease, Lessee may,
except as otherwise provided in this Lease, receive, collect and enjoy the
rents accruing under such sublease. Lessor shall not, by reason of the
foregoing provision or any other assignment of such sublease to Lessor, nor by
reason of the collection of the rents from a sublessee, be deemed liable to the
sublessee for any failure of Lessee to perform and comply with any of Lessee’s
obligations to such sublessee under such Sublease. Lessee hereby irrevocably
authorizes and directs any such sublessee, upon receipt of a written notice
from Lessor stating that a Breach exists in the performance of Lessee’s
obligations under this Lease, to pay to Lessor the rents and other charges due
and to become due under the sublease. Sublessee shall rely upon any such
statement and request from Lessor and shall pay such rents and other charges to
Lessor without any obligation or right to inquire as to whether such Breach
exists and notwithstanding any notice from or claim from Lessee to the
contrary. Lessee shall have no right or claim against such sublessee, or, until
the Breach has been cured, against Lessor, for any such rents and other charges
so paid by said sublessee to Lessor.

 

(b)                                 In the event of a Breach by Lessee in the
performance of its obligations under this Lease, Lessor, at its option and
without any obligation to do so, may require any sublessee to attorn to Lessor,
in which event Lessor shall undertake the obligations of the sublessor under
such sublease from the time of the exercise of said option to the expiration of
such sublease; provided, however, Lessor shall not be liable for any prepaid
rents or security deposit paid

 

26

 

by
such sublessee to such sublessor or for any other prior defaults or breaches of
such sublessor under such sublease.

 

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

 

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

 

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

 

13.                                 Default; Breach; Remedies.

 

13.1                           Default; Breach. Lessee’s obligations to Lessor hereunder
shall include any and all costs or expenses incurred by Lessor in conjunction
with enforcing Lessor’s rights and remedies hereunder, which shall include, but
shall not be limited to, reasonable attorneys’ fees or other legal expenses or
costs associated therewith, and that Lessor may include the cost of such
services and costs in any notice of Default as rent due and payable to cure
said default A “Default” by Lessee
is defined as a failure by Lessee to observe, comply with or perform any of the
terms, covenants, conditions or rules applicable to Lessee under this Lease, A “Breach” by Lessee is defined as the
occurrence of any Default, including but not limited those listed below, and,
where a grace period for cure after notice is specified herein, the failure by
Lessee to cure such Default prior to the expiration of the applicable grace
period, and shall entitle Lessor to pursue the remedies set forth in Paragraphs
13.2 and/or 13.3:

 

(a)                                  The vacating of the Premises without the
intention to reoccupy same, or the abandonment of the Premises; provided,
however, that Lessee shall not be deemed to have vacated or abandoned the
Premises if it continues to timely pay all amounts due under this Lease, keeps
the Premises secure, and otherwise maintains the Premises in accordance with
this Lease.

 

(b)                                 The failure by Lessee to make any payment of
Rent, maintain the insurance required under Paragraph 8 of this Lease, pay Real
Property Taxes as required under Paragraph 10 of this Lease, or any other
monetary payment required to be made by Lessee hereunder as and when due, or
the failure by Lessee to provide Lessor with reasonable evidence of insurance
or surety bond required under this Lease, where such failure continues for a
period of five (5) days following Lessee’s receipt of written notice thereof
from or on behalf of Lessor.

 

(c)                                  Except as expressly otherwise provided in
this Lease, the failure by Lessee to provide Lessor with reasonable written
evidence (in duly executed original form, if applicable) of (i) compliance with
Applicable Requirements per Paragraph 6.3, (ii) the inspection, maintenance and
service contracts required under Subparagraph 7.1 (b), (iii) the
rescission of an unauthorized assignment or subletting per Paragraph 12.1, (iv)
a Tenancy Statement per Paragraph 16, (v) the subordination or
non-subordination of this Lease per Paragraph 30, (vi) the

 

27

 

execution
of any document requested under Paragraph 41 (Reservations), or (vii) any other
documentation or information which Lessor may reasonably require of Lessee
under the terms of this Lease, where any such failure continues for a period of
fifteen (15) days following Lessee’s receipt of written notice from or on
behalf of Lessor.

 

(d)                                 A Default by Lessee as to the term,
covenants, conditions or provisions of this Lease, that are to be observed,
complied with or performed by Lessee, other than those described in
Subparagraphs 13.1 (a), (b) or (c), above, where such Default continues for a
period of thirty (30) days after Lessee’s receipt of written notice thereof
from or on behalf of Lessor; provided, however, that if the nature of Lessee’s
Default is such that more than thirty (30) days are reasonably required for its
cure, then it shall not be deemed to be a Breach of this Lease by Lessee if
Lessee commences such cure within said thirty (30) day period and thereafter
diligently prosecutes such cure to completion.

 

(e)                                  The occurrence of any of the following
events: (i) the making by Lessee of any general arrangement or assignment for
the benefit of creditors; (ii) Lessee’s becoming a “debtor” as defined in 11
U.S. Code Section 101 or any successor statute thereto (unless, in the case of
a petition filed against Lessee, the same is dismissed within sixty (60) days);
(iii) the appointment of a
trustee or receiver to take possession of substantially all of Lessee’s assets
located at the Premises or of Lessee’s interest in this Lease, where possession
is not restored to Lessee within thirty (30) days; or (iv) the attachment,
execution or other judicial seizure of substantially all of Lessee’s assets
located at the Premises or of Lessee’s interest in this Lease, where such
seizure is not discharged within thirty (30) days; provided, however, in the
event that any provision of this Subparagraph 13.1 (e) is contrary to any applicable law, such provision shall
be of no force or effect, and shall not affect the validity of the remaining
provisions.

 

13.2                           Remedies. If Lessee fails to perform any affirmative
duty or obligation of Lessee under this Lease and such failure continues beyond
the applicable notice and cure period as provided in Paragraph 13.1 above
(provided that in case of an emergency, no notice and cure period shall be
required), Lessor may at its option (but without obligation to do so), perform
such duty or obligation on Lessee’s behalf, including but not limited to the
obtaining of reasonably required bonds, insurance policies, or governmental
licenses, permits or approvals. The costs and expenses of any such performance
by Lessor shall be due and payable by Lessee to Lessor upon invoice therefor.
In the event of a Breach of this Lease by Lessee, with or without further
notice or demand, and without limiting Lessor in the exercise of any right or
remedy, which Lessor may have by reason of such Breach, Lessor may:

 

(a)                                  Terminate Lessee’s right to possession of the
Premises by any lawful means, in which case this Lease and the Term hereof
shall terminate and Lessee shall immediately surrender possession of the
Premises to Lessor. In such event Lessor shall be entitled to recover from
Lessee; (i) the worth at the time of the award of the unpaid rent which had
been earned at the time of termination; (ii) the worth at the time of award of
the amount by which the unpaid rent which would have been earned after
termination until the time of award exceeds the amount of such rental loss that
the Lessee proves could have been reasonably avoided; (iii) the worth at the
time of award of the amount by which the unpaid rent for the balance of the
Term after the time of award exceeds the amount of such rental loss that the
Lessee proves could be reasonably avoided; and

 

28

 

(iv) any other amount necessary to compensate Lessor for all the
detriment proximately caused by the Lessee’s failure to perform its obligations
under this Lease or which in the ordinary course of things would be likely to
result therefrom, including but not limited to the cost of recovering
possession of the Premises, expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorneys’ fees, and that
portion of any leasing commission paid by Lessor in connection with this Lease
applicable to the unexpired Term of this Lease. The worth at the time of award
of the amount referred to in provision (iii) of the immediately preceding
sentence shall be computed by discounting such amount at the discount rate of
the Federal Reserve Bank District in which the Premises are located at the time
of award plus one percent (1%). Efforts by Lessor to mitigate damages caused by
Lessee’ s Default or Breach of this Lease shall not waive Lessor’s right to
recover damages under this Paragraph 13.2. If termination of this Lease is
obtained through the provisional remedy of unlawful detainer, Lessor shall have
the right to recover in such proceeding the unpaid rent and damages as are
recoverable therein, or Lessor may reserve the right to recover all or any part
thereof in a separate suit for such rent and/or damages. If a notice and grace
period required under Subparagraph 13.1 (b), (c) or (d) was not previously
given, a notice to pay rent or quit, or to perform or quit, as the case may be,
given to Lessee under any statute authorizing the forfeiture of leases for
unlawful detainer shall also constitute the applicable notice for grace period
purposes required by Subparagraph 13.1 (b), (c) or (d). In such case, the
applicable grace period under the unlawful detainer statute shall run
concurrently after the one such statutory notice, and the failure of Lessee to
cure the Default within the greater of the two (2) such grace periods shall
constitute both an unlawful detainer and a Breach of this Lease entitling
Lessor to the remedies provided for in this Lease and/or by said statute.

 

(b)                                 Continue
the Lease and Lessee’s right to possession in effect after Lessee’s Breach and
recover the rent as it becomes due, provided Lessee has the right to sublet or
assign, subject only to reasonable limitations. Lessor and Lessee agree that
the limitations on assignment and subletting this Lease are reasonable. Acts of
maintenance or preservation, efforts to relet the Premises, or the appointment
of a receiver to protect the Lessor’s interest under this Lease, shall not
constitute a termination of the Lessee’s right to possession.

 

(c)                                  Pursue
any other remedy now or hereafter available to Lessor under the laws or
judicial decisions of the state wherein the Premises are located.

 

(d)                                 The
expiration or termination of this Lease and/or the termination of Lessee’s
right to possession shall not relieve Lessee from liability under any indemnity
provisions of this Lease as to matters occurring or accruing during the Term
hereof or by reason of Lessee’s occupancy of the Premises.

 

13.3                           Intentionally Deleted.

 

13.4                           Late Charges. Lessee hereby acknowledges
that late payment by Lessee to Lessor of rent and other sums due hereunder will
cause Lessor to incur costs not contemplated by this Lease, the exact amount of
which will be extremely difficult to ascertain. Such costs include, but are not
limited to, processing and accounting charges, and late charges, which may be
imposed upon Lessor by the terms of any ground lease, mortgage or deed of trust
covering the Premises. Accordingly, if any installment of rent or other sum due
from Lessee shall not be received by Lessor

 

29

 

or
Lessor’s designee within five (5) days after Lessor’s delivery of written
notice that such amount is due, then, without any further requirement for
notice to Lessee, Lessee shall pay to Lessor a late charge equal to ten percent
(10%) of such overdue amount. The parties hereby agree that such late charge
represents a fair and reasonable estimate of the costs Lessor will incur by
reason of late payment by Lessee, Acceptance of such late charge by Lessor
shall in no event constitute a waiver of Lessee’s Default or Breach with
respect to such overdue amount, nor prevent Lessor from exercising any of the
other rights and remedies granted hereunder. In the event that a late charge is
payable hereunder, whether or not collected, for three (3) consecutive
installments of Base Rent, then notwithstanding Paragraph 4 or any other
provision of this Lease to the contrary, Base Rent shall, at Lessor’s option,
become due and payable quarterly in advance.

 

13.5                           Breach by Lessor. Lessor shall not be deemed in breach of this
Lease unless Lessor fails within a reasonable time to perform an obligation
required to be performed by
Lessor. For purposes of this Paragraph 13.5, a reasonable time shall in no
event be less than thirty (30) days after receipt by Lessor of written notice
specifying wherein such obligation of Lessor has not been performed; provided,
however, that if the nature of Lessor’s obligation is such that more than
thirty (30) days after such notice are reasonably required for its performance,
then Lessor shall not be in breach of this Lease if performance is commenced
within such thirty (30) day period and thereafter diligently pursued to
completion.

 

14.                                 Condemnation. If the Premises or any portion thereof are
permanently taken under the power of eminent domain or sold under the threat of
the exercise of said power (all of which are herein called “condemnation”, this
Lease shall terminate as to the part so taken as of the date the condemning
authority takes title or possession, whichever first occurs. If a material
portion of the floor area of the Premises, or a material portion of the
Premises designated for Lessee’s parking, is subject to a taking, and the
remaining portion of the Premises not so taken is unsuitable or inadequate for
the uses and purposes for which they are then being utilized by Lessee in the
reasonable judgment of Lessee, Lessee may, at Lessee’s option, to be exercised
in writing within thirty (30) days after Lessor shall have given Lessee written
notice of such taking (or in the absence of such notice, within ten (10) days
after the condemning authority shall have taken possession) terminate this
Lease as of the date the condemning authority takes such possession. If Lessee
does not terminate this Lease in accordance with the foregoing, this Lease
shall remain in full force and effect as to the portion of the Premises
remaining, except that the Base Rent shall be reduced in the same proportion as
the rentable floor area of the Premises taken bears to the total rentable floor
area of the Premises and Lessor shall equitably abate Rent for any portion of
the parking area taken as determined by Lessor in its reasonable discretion.
Any award for the taking of all or any part of the Premises under the power of
eminent domain or any payment made under threat of the exercise of such power
shall be the property of Lessor, whether such award shall be made as compensation
for diminution of value of the leasehold or for the taking of the fee, or as
severance damages; provided, however, that Lessee shall be entitled to any
compensation, separately awarded to Lessee for Lessee’s relocation expenses
and/or loss of Lessee’s Trade Fixtures, Lessee-Owned Utility Installations, or
Lessee-Owned Alterations. In the event that this Lease is not terminated by
reason of such condemnation, Lessor shall to the extent of its net severance
damages received, over and above the legal and other expenses incurred by
Lessor in the condemnation matter, repair any

 

30

 

damage
to the Premises caused by such condemnation authority. Lessee shall be
responsible for the payment of any amount in excess of such net severance
damages required to complete such repair.

 

15.                                 Brokers.

 

15.1                           Procuring Cause. The Broker(s) named in Paragraph 1.7 is/are
the procuring cause of this Lease.

 

15.2                           Representations and
Warranties. Lessee and
Lessor each represent and warrant to the other that it has had no dealings with
any person, firm, broker or finder other than as named in Paragraph 1.7 in
connection with the negotiation of this Lease and/or the consummation of the
transaction contemplated hereby, and that no broker or other person, firm or
entity other than said named Broker(s) is entitled to any commission or
finder’s fee in connection with said transaction. Lessee and Lessor do each
hereby agree to indemnify, protect, defend and hold the other harmless from and
against liability for compensation or charges which may be claimed by any such
unnamed broker, finder or other similar party by reason of any dealings or
actions of the indemnifying Party, including any costs, expenses, and/or
attorneys’ fees reasonably incurred with respect thereto.

 

16.                                 Estoppel Certificates and
Financial Statements.

 

16.1                           Estoppel Certificates. Within fifteen (15) days after notice from
Lessor, Lessee shall execute and deliver to Lessor a certificate stating such
matters reflecting the status of this Lease or the Premises as Lessor or
Lessor’s lender, purchaser or ground lessor may reasonably request. If Lessee
shall fail to deliver such certificate within said fifteen (15) day period,
such failure shall constitute a material default under this Lease. Any such
election by Lessor shall not cure Lessee’s default, and Lessee shall continue
to be obligated to deliver such certificate.

 

16.2                           Financial Statement. If Lessor desires to finance, refinance, or
sell the Premises, or any part thereof, not more often than once during any
twelve month period, Lessee shall deliver to any potential lender or purchaser
designated by Lessor such financial statements of Lessee as may be reasonably
required by such lender or purchaser, including but not limited to Lessee’s
financial statements for the past three (3) years, provided, however, that if
Lessee’s stock is publicly held, Lessee’s public financial reports shall
satisfy the requirements of this Paragraph 16.2. All such financial statements
shall be received by Lessor and such lender or purchaser in confidence and
shall be used only for the purposes herein set forth.

 

17.                                 Lessor’s Liability. The term “Lessor”
as used herein shall mean the owner or owners at the time in question of the
fee title to the Premises. In the event of a transfer of Lessor’s title or
interest in the Premises or in this Lease, Lessor shall deliver to the
transferee or assignee (in cash or by credit) any unused Security Deposit held
by Lessor at the time of such transfer or assignment. Upon such transfer or
assignment and delivery of the Security Deposit, as aforesaid, the prior Lessor shall be relieved of
all liability with respect to the obligations and/or covenants under this Lease
thereafter to be performed by the Lessor, Subject to the foregoing, the
obligations and/or covenants in this Lease to be performed by the Lessor shall
be binding only upon the Lessor as hereinabove defined. Notwithstanding
anything to the contrary contained in the Lease, Lessee

 

31

 

agrees
that its sole and exclusive remedy shall be against Lessor’s interest in the
Premises and that the obligations of Lessor under the Lease do not constitute
personal obligations of the individual partners, whether general or limited,
members, directors, officers, shareholders or trustees of Lessor, and Lessee
shall not seek recourse against the individual partners, members, directors,
officers, shareholders or trustees of Lessor or any of their personal assets
for satisfaction of any liability with respect to the Lease.

 

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

 

19.                                 Interest on Past-Due Obligations.
Any monetary payment due
Lessor hereunder, other than late charges, not received by Lessor within ten
(10) days following notice from Lessor that such payment is due, shall bear
interest from the date due at the prime rate charged by the largest state
chartered bank in the State in which the Premises are located plus four percent
(4%) per annum, but not exceeding the maximum rate allowed by law, in addition
to the potential late charge provided for in Paragraph 13.4.

 

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

 

21.                                 Rent Defined. All monetary obligations of Lessee to Lessor
under the terms of this Lease are deemed to be rent.

 

22.                                 No Prior or Other Agreements.
This Lease contains all
agreements between the Parties with respect to any matter mentioned herein, and
no other prior or contemporaneous agreement or understanding shall be
effective.

 

23.                                 Notices. All notices required or permitted by this
Lease shall be in writing and shall be and deemed duly served or given when
actually delivered, if personally delivered (including delivery by Federal
Express, Express Mail or other similar overnight or personal courier service
which confirms delivery in writing), or within three (3) business days after
deposit in the U.S. Mail, if sent by certified mail, postage prepaid, return
receipt requested, and shall be deemed sufficiently given if served in a manner
specified in this Paragraph 23. If notice is received on a Saturday or a Sunday
or a legal holiday, it shall be deemed received on the next business day. The
addresses noted adjacent to a Party’s signature on this Lease shall be that
Party’s address for delivery or mailing of notice purposes. Either Party may by
written notice to the other specify a different address for notice purposes. A
copy of all notices required or permitted to be given to Lessor hereunder shall
be concurrently transmitted to such party or parties at such addresses as Lessor
may from time to time hereafter designate by written notice to Lessee.

 

24.                                 Waivers. No waiver by either Party of the Default or
Breach of any term, covenant or condition hereof by the other Party, shall be
deemed a waiver of any other term, covenant or condition hereof, or of any
subsequent Default or Breach by the other Party of the same or any other term,
covenant or condition hereof Lessor’s consent to, or approval of, any such act
shall not be deemed to render unnecessary the obtaining of Lessors consent to,
or approval of, any subsequent or similar act by Lessee, or be construed as the
basis of an estoppel to enforce the provision or

 

32

 

 

provisions
of this Lease requiring such consent. Regardless of Lessor’s knowledge of a
Default or Breach at the time of accepting rent, the acceptance of rent by
Lessor shall not be a waiver of any Default or Breach by Lessee of any
provision hereof. Any payment given Lessor by Lessee may be accepted by Lessor
on account of moneys or damages due Lessor, notwithstanding any qualifying
statements or conditions made by Lessee in connection therewith, which such
statements and/or conditions shall be of no force or effect whatsoever unless
specifically agreed to in writing by Lessor at or before the time of deposit of
such payment.

 

25.                                  Recording. Either Lessor or Lessee shall, upon request
of the other, execute, acknowledge and deliver to the other a short form
memorandum of this Lease, in a form acceptable to Lessor, for recording
purposes. The Party requesting recordation shall be responsible for payment of
any fees or taxes applicable thereto.

 

26.                                  No Right To Holdover. Lessee has no right to retain possession of
the Premises or any part thereof beyond the expiration or earlier termination
of this Lease. In the event that Lessee holds over in violation of this
Paragraph 26 then the Base Rent payable from and after the time of the
expiration or earlier termination of this Lease shall be increased to one
hundred fifty percent (150%) of the Base Rent applicable during the month
immediately preceding such expiration or earlier termination. Nothing contained
herein shall be construed as consent by Lessor to any holding over by Lessee.

 

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

 

28.                                  Covenants and Conditions. All provisions of this Lease to be observed
or performed by Lessee are both covenants and conditions.

 

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

 

30.                                 Subordination; Attornment;
Non-Disturbance.

 

30.1                            Subordination.  Subject to the non-disturbance provisions of
Paragraph 30.3, this Lease and any Option granted hereby shall automatically be
subject and subordinate to any ground lease, mortgage, deed of trust, or other
hypothecation or security device or amendment or modification thereto
(collectively, “Security Device”), now or hereafter placed by
Lessor upon the real property of which the Premises are a part, to any and all
advances made on the security thereof, and to all renewals, modifications,
consolidations, replacements and extensions thereof. Lessee agrees that the
Lenders holding any such Security Device shall have no duty, liability or
obligation to perform any of the obligations of Lessor under this Lease. If any
Lender shall elect to have this Lease and/or any Option granted hereby superior
to the lien of its Security Device and shall give written notice thereof to
Lessee, this Lease and such Options shall be deemed prior to such Security
Device, notwithstanding the relative dates of the documentation or recordation
thereof.

 

33

 

30.2                             Attornment.  Subject to the non-disturbance provisions of Paragraph 30.3, Lessee
agrees to attorn to a Lender or any other party who acquires ownership of the
Premises by reason of a foreclosure of a Security Device, and that in the event
of such foreclosure, such new owner shall not: (i) be liable for any act or
omission or any prior lessor or with respect to events occurring prior to
acquisition of ownership, (ii) be subject to any offsets or defenses which
Lessee might have against any prior lessor, or (iii) be bound by prepayment of
more than one month’s rent.

 

30.3                             Non-Disturbance.  With respect to all Security Devices entered into by Lessor
contemporaneously with or after the execution of this Lease and all amendments
or modifications to existing or new Security Devices, Lessee’s subordination of
this Lease shall be subject to receiving written assurance (a “Nondisturbance Agreement”) from the Lender that Lessee’s
possession and this Lease, including any Lessee options provided herein, will
not be disturbed so long as Lessee is not in Breach hereof and attorns to the
record owner of the Premises.

 

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

 

31.                                 Attorneys’ Fees. If
any Party brings an action or proceeding to enforce the terms hereof or declare
rights hereunder, the Prevailing Party (as hereafter defined) in any such
proceeding, action, or appeal thereon, shall be entitled to reasonable
attorneys’ fees. Such fees may be awarded in the same suit or recovered in a
separate suit, whether or not such action or proceeding is pursued to decision
or judgment. The term “Prevailing Party” shall
include, without limitation, a Party who substantially obtains or defeats the
relief sought, as the case may be, whether by compromise, settlement, judgment,
or the abandonment by the other Party of its claim or defense. The attorneys’
fee award shall not be computed in accordance with any court fee schedule, but
shall be such as to fully reimburse all attorneys’ fees reasonably incurred.
Lessor shall be entitled to the attorneys’ fees, costs and expenses incurred in
preparation and service of notices of Default and consultations in connection
therewith.

 

32.                                 Lessor’s Access; Showing
Premises; Repairs. Lessor and Lessor’s agents shall have the
right to enter the Premises at any time, in the case of an emergency, and
otherwise at reasonable times upon reasonably prior notice for the purpose of
showing the same to prospective purchasers, lenders, or lessees, and making
such alterations, repairs, improvements or additions to the Premises, as Lessor
may reasonably deem necessary. Lessee agrees to have a representative available
at its main office at the Premises twenty-four (24) hours a day, seven (7) days
a week and three hundred sixty five (365) days a year to provide Lessor with
access to the Premises through Lessee’s security system following Lessee’s receipt
of reasonable prior notice of such request for access and Lessor agrees to use
commercially reasonable efforts to orally contact such representative if Lessor
requires access to the Premises in the event of an emergency. In addition, in
connection with any such entry, Lessor agrees to observe Lessee’s reasonable
security and visitation guidelines, provided that Lessor has received a written
copy of such guidelines. Lessor may at any time place on or about the Premises
any ordinary “For Sale” signs and Lessor may at any time

 

34

 

during
the last one hundred eighty (180) days of the Term hereof place on or about the
Premises any ordinary “For Lease” signs. All such activities of Lessor shall be
without abatement of rent or liability to Lessee, provided that Lessor uses
commercially reasonable efforts to minimize any interference with Lessee’s
business conducted at the Premises.

 

33.                                 Auctions. Lessee
shall not conduct, nor permit to be conducted, either voluntarily or involuntarily,
any auction upon the Premises without first having obtained Lessor’s prior
written consent. Notwithstanding anything to the contrary in this Lease, Lessor
shall not be obligated to exercise any standard of reasonableness in determining
whether to grant such consent.

 

34.                                 Signs. Lessee
shall not place any sign upon the exterior of the Premises, except that Lessee
may, with Lessor’s prior written consent, install (but not on the roof) such
signs as are reasonably required to advertise Lessee’s own business so long as
such signs comply with Applicable Requirements. The installation of any sign on
the Premises by or for Lessee shall be subject to the provisions of Paragraph 7
(Maintenance, Repairs, Utility Installations, Trade Fixtures and Alterations).
Unless otherwise expressly agreed herein, Lessor reserves all rights to the use
of the roof of the Premises, and the right to install advertising signs on the
Premises, including the roof, which do not unreasonably interfere with the
conduct of Lessee’s business. Lessor shall be entitled to all revenues from
such advertising signs. Any and all signs currently existing at the Premises
are deemed approved by Lessor.

 

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

 

36.                                  Consents. Except
for Paragraph 33 hereof (Auctions) or as otherwise provided herein, wherever in
this Lease the consent of a Party is required to an act by or for the other
Party, such consent shall not be unreasonably withheld, conditioned or delayed.
Lessor’s consent to any act, assignment of this Lease or subletting of the Premises
by Lessee shall not constitute an acknowledgment that no Default or Breach by
Lessee of this Lease exists, nor shall such consent be deemed a waiver of any
then existing Default or Breach, except as may be otherwise specifically stated
in writing by Lessor at the time of such consent. The failure to specify herein
any particular condition to Lessor’s consent shall not preclude the impositions
by Lessor at the time of consent of such further or other conditions as are
then reasonable with reference to the particular matter for which consent is
being given.

 

37.                                 Intentionally Omitted.

 

38.                                  Quiet Possession.  Upon
payment by Lessee of the Rent for the Premises and the performance of all of
the covenants, conditions and provisions on Lessee’s part to be observed and

 

35

 

performed under this Lease, and unless specifically provided herein,
Lessee shall have quiet possession of the Premises for the entire Term hereof
subject to all of the provisions of this Lease.

 

39.                                  Counterparts.  This
Lease may be executed in counterparts. All executed counterparts shall
constitute one agreement, and each counterpart shall be deemed an original.

 

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

 

41.                                  Reservations.  Lessor reserves the right,
from time to time, to grant, without the consent or joinder of Lessee, such
easements, rights of way, utility raceways, and dedications that Lessor deems
necessary, and to cause the recordation of parcel maps and restrictions, so
long as such easements, rights of way, utility raceways, dedications, maps and
restrictions do not unreasonably interfere with or materially and adversely
affect Lessee’s use of the Premises. Lessee agrees to sign any documents
reasonably requested by Lessor to effectuate any such easement rights, dedication,
map or restrictions.

 

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

 

43.                                  Authority.  If
either Party hereto is a corporation, trust, or general or limited partnership,
each individual executing this Lease on behalf of such entity represents and
warrants that he or she is duly authorized to execute and deliver this Lease on
its behalf. If Lessee is a corporation, trust or partnership, Lessee shall,
within thirty (30) days after request by Lessor, deliver to Lessor evidence
satisfactory to Lessor of such authority.

 

44.                                  Conflict.  The typewritten or
handwritten provisions shall control any conflict between the printed
provisions of this Lease and the typewritten or handwritten provisions.

 

45.                                  Offer.  Preparation of this Lease
by either Lessor or Lessee or Lessor’s agent or Lessee’s agent and submission
of same to Lessee or Lessor shall not be deemed an offer to lease. This Lease
is not intended to be binding until executed and delivered by all Parties
hereto.

 

46.                                  Amendments.  This Lease may be modified
only in writing, signed by the parties in interest at the time of the
modification. The Parties shall amend this Lease from time to time to reflect any adjustments that are
made to the Base Rent or other rent payable under this Lease. As long as they
do not materially change Lessee’s obligations hereunder, Lessee agrees to make
such

 

36

 

reasonable
nonmonetary modifications to this Lease as may be reasonably required by and
institutional insurance company or pension plan Lender in connection with the
obtaining of normal financing or refinancing of the property of which the
Premises are a part.

 

47.                                  Multiple Parties.  Except
as otherwise expressly provided herein, if more than one person or entity is
named herein as either Lessor or Lessee, the obligations of such multiple
parties shall be the joint and several responsibility of all persons or entities
named herein as such Lessor or Lessee.

 

48.                                  Construction.  Headings
at the beginning of each paragraph and subparagraph are solely for the
convenience of the parties and are not a part of the Lease. Whenever required
by the context of this Lease, the singular shall include the plural and the
masculine shall include the feminine and vice versa. This Lease shall not be
construed as if it had been prepared by one of the parties, but rather as if
both parties had prepared the same and, consequently, any inconsistencies or ambiguities
herein shall not be interpreted against either party as the drafter of the
Lease. Unless otherwise indicated, all references to paragraphs and
subparagraphs are to this Lease. All exhibits referred to in this Lease are
attached and incorporated by this reference. Except as specifically provided
herein, Lessee hereby agrees that Lessee shall not disclose any of the economic
terms of this Lease to any person or entity not a party to this Lease, nor
shall Lessee issue any press releases or make any public statements relating to
the terms or provisions of this Lease; provided, however, Lessee may make
necessary disclosures to potential lenders, attorneys, accountants and space planning
consultants, and/or as may be required by applicable laws or court order. The
obligation of Lessee set forth in this section shall survive the expiration or
any earlier termination of this Lease.

 

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

 

IF
THIS LEASE HAS BEEN FILLED IN, IT HAS BEEN PREPARED FOR YOUR ATTORNEY’S REVIEW
AND APPROVAL, FURTHER, EXPERTS SHOULD BE CONSULTED TO EVALUATE THE CONDITION OF
THE PROPERTY AS TO THE POSSIBLE PRESENCE OF ASBESTOS, UNDERGROUND STORAGE TANKS
OR HAZARDOUS SUBSTANCES. THE PARTIES SHALL RELY SOLELY UPON THE ADVICE OF THEIR
OWN COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE. IF THE SUBJECT
PROPERTY IS LOCATED IN A STATE OTHER THAN CALIFORNIA, AN ATTORNEY FROM THE STATE
WHERE THE PROPERTY IS LOCATED SHOULD BE CONSULTED.

 

[SIGNATURES ON NEXT PAGE]

 

37

 

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

 

 

	
  Executed at
  San Diego, California

  	
  Executed at
  San Jose, California

  
	
  on

  	
  on

  
	
   

  	
   

  
	
   

  	
   

  
	
  LESSOR

  	
  LESSEE

  
	
   

  	
   

  
	
  WESTCORE
                          ,
  LLC,

  	
  FLEXTRONICS
  INTERNATIONAL

  
	
  a Delaware
  limited liability company

  	
  USA, INC.,

  
	
   

  	
  a California
  corporation

  
	
   

  	
   

  
	
  By:

  	
  Westcore
                  Partners,

  	
   

  
	
   

  	
  a Delaware
  general partnership,

  	
  By:

  	
   

  	
   

  
	
   

  	
  its sole
  member

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
  By:

  	
  WP
                            ,
  LLC,

  	
   

  
	
   

  	
  a Delaware
  limited liability company,

  	
   

  
	
   

  	
  its managing
  partner

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  By:

  	
  MRB Manager,
  LLC,

  	
  Title:

  	
   

  	
   

  
	
   

  	
  a Delaware
  limited liability company,

  	
   

  
	
   

  	
  its manager

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Address:

  	
   

  
	
   

  	
  Address:

  
	
  c/o Westcore
  Properties, LLC

  	
   

  
	
  235 Pine
  Street, Suite 1150

  	
  Flextronics
  International USA, Inc.

  
	
  San
  Francisco, California 94104

  	
  2090 Fortune
  Drive

  
	
  Attention:
  Asset Manager

  	
  San Jose,
  California 95131

  
	
   

  	
  Attention:
  Tim Stewart

  
	
   

  	
   

  
	
  With a copy
  to:

  	
   

  
	
   

  	
   

  
	
  Westcore
  Properties, LLC

  	
   

  
	
  4445
  Eastgate Mall, Suite 210

  	
   

  
	
  San Diego,
  CA 92121

  	
   

  
	
  Telephone:
  (858) 625-4100

  	
   

  
	
  Facsimile:
  (858) 678-0060

  	
   

  

 

38

 

EXHIBIT A

 

PREMISES

 

 

THE SITE PLAN SET FORTH
HEREIN IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE A WARRANTY OR
REPRESENTATION CONCERNING THE SIZE OR LAYOUT OF THE PREMISES.

 

 

[see attached]

 

1

 

EXHIBIT B

 

HAZARDOUS SUBSTANCES SURVEY FORM

 

The
purpose of this form is to obtain information regarding the use of Hazardous
Substances on the Premises. Prospective lessees should answer the questions in
light of their proposed operations on the Premises. Existing lessees should
answer the questions as they relate to ongoing operations on the Premises and
should update any information previously submitted. If additional space is
needed to answer the questions, you may attach separate sheets of paper to this
form. All statements made herein are made pursuant to, and are governed by,
Section 6.2(d) of the Lease dated December    , 2006 between
Lessor and Lessee.

 

Your cooperation in this
matter is appreciated. Any questions should be directed to, and when completed,
the form should be mailed to:

 

	
   

  	
  c/o Westcore
  Properties

  
	
   

  	
  235 Pine
  Street, Suite 1150

  
	
   

  	
  San
  Francisco, CA 94104

  

 

1.                                      GENERAL INFORMATION

 

Company
Name:
                                                                                                                                                                                     

 

Check
Applicable Status: Prospective Lessee:
                               
Current Lessee:
             

 

Mailing
Address: 

 

 

 

Contact
Person & Title:
                                                                                                                                                                           

 

Phone
#: (      )
                                                                                                                                                                                          

 

Address of Premises:
                                                                                                                                                                                

 

Describe
the proposed operations to take place on the Premises, including principal
products manufactured or services to be conducted. Existing lessees should
describe any proposed changes to ongoing operations.

 

 

 

 

1

 

2.                                     STORAGE
OF HAZARDOUS SUBSTANCES

 

2.1                                Will
any Hazardous Substances be used or stored on the Premises?

 

	
  Wastes

  	
   

  	
  Yes o

  	
   

  	
  No o

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Chemical Products

  	
   

  	
  Yes o

  	
   

  	
  No o

  

 

Attach the list of any Hazardous Substances to be used or stored, the
quantities that will be on site at any given time, and the location and method
of storage.

 

3.                                      STORAGE
TANKS & SUMPS

 

3.1                                 Is
any above or belowground storage of gasoline, diesel, or other Hazardous
Substances in tanks or sumps proposed or currently conducted on the Premises?

 

	
   

  	
  Yes o

  	
  No o

  

 

If yes, describe the materials to be stored, and the type, size and
construction of the sump or tank. Attach copies of any permits obtained for the
storage of such substances.

 

 

 

3.2                                 Have
any of the tanks or sumps been inspected or tested for leakage?

 

	
   

  	
  Yes o

  	
  No o

  

 

If so, attach results.

 

3.3                                 Have
any spills or leaks occurred from such tanks or sumps within the past twelve
months?

 

	
   

  	
  Yes o

  	
  No o

  

 

If so, describe.

 

3.4                                 Were
any regulatory agencies notified of the spill or leak?

 

	
   

  	
  Yes o

  	
  No o

  

 

If so, attach copies of any spill reports filed, any clearance letters
or other correspondence from regulatory agencies relating to the spill or leak.

 

2

 

3.5                                 Have any underground
storage tanks or sumps been taken out
of service or been removed within the past twelve months?

 

	
   

  	
  Yes o

  	
  No o

  

 

If yes, attach copies of any closure permits and clearance obtained
from regulatory agencies relating to closure and removal of such tanks.

 

4.                                      SPILLS

 

4.1                                 During
the past twelve months, have any spills occurred on the Premises?

 

	
   

  	
  Yes o

  	
  No o

  

 

If so, please describe the spill and attach the results of any testing
conducted to determine the extent of such spills.

 

4.2                                 Were any agencies
notified in connection with such spills?

 

	
   

  	
  Yes o

  	
  No o

  

 

If so, attach copies of any spill reports or other correspondence with
regulatory agencies.

 

4.3                                 Were
any cleanup actions undertaken in connection with the spill?

 

	
   

  	
  Yes o

  	
  No o

  

 

If so, briefly describe the actions taken. Attach copies of any
clearance letters obtained from any regulatory agencies involved and the
results of any final soil or ground water sampling done upon completion of the
cleanup work.

 

 

 

 

 

 

5.                                      WASTE MANAGEMENT

 

5.1                                 Has
your company been issued an EPA Hazardous Waste Generator I.D. Number?

 

	
   

  	
  Yes o

  	
  No o

  

 

5.2                                 Has
your company filed a biennial report as a hazardous waste generator?

 

	
   

  	
  Yes o

  	
  No o

  

 

3

 

If so, attach a copy of the most recent report files.

 

5.3                                 Attach a list of the
Hazardous Substances, if any, generated or to be generated at the Premises, its
hazard class and the quality generated on a monthly basis.

 

5.4                                 Describe the method(s)
of disposal for each substance. Indicate where and how often disposal will take
place.

 

 

 

 

 

 

5.5                                 Indicate the name of
the person(s) responsible for maintaining copies of hazardous manifests
completed for off-site shipments of Hazardous Substances.

 

 

 

5.6                                 Is any treatment or
processing of Hazardous Substances currently conducted or proposed to be
conducted at the Premises:

 

	
   

  	
  Yes o

  	
  No o

  

 

If yes, please describe any existing or proposed treatment methods.

 

 

 

5.7                                 Attach copies of any
hazardous waste permits or licenses issued to your company with respect to its
operations on the Premises.

 

6.                                      WATER
TREATMENT / DISCHARGE

 

6.1                                 Do
you discharge waste water to:

 

	
   

  	
  o

  	
  storm drain?

  	
  o

  	
  sewer?

  
	
   

  	
   

  	
   

  
	
   

  	
  o

  	
  surface
  water:

  	
  o

  	
  no
  industrial discharge.

  

 

6.2                                 Is
your wastewater treated before discharge?

 

	
   

  	
  Yes o

  	
  No o

  

 

4

 

If
yes, describe the type of treatment conducted.

 

 

 

Attach copies of any
wastewater discharge permits issued to your company with respect to its
operations on the Premises.

 

7.                                      AIR DISCHARGES

 

7.1                                 Do you have any filtration systems or stacks
that discharge into the air?

 

	
   

  	
  Yes o

  	
  No o

  

 

7.2                                 Do you operate any of the following types of
equipment, or any other equipment requiring an air emissions permit?

 

	
   

  	
  o

  	
  Spray booth

  
	
   

  	
   

  	
   

  
	
   

  	
  o

  	
  Dip tank

  
	
   

  	
   

  	
   

  
	
   

  	
  o

  	
  Drying oven

  
	
   

  	
   

  	
   

  
	
   

  	
  o

  	
  Incinerator

  
	
   

  	
   

  	
   

  
	
   

  	
  o

  	
  Other

  	
                                                 

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  o

  	
  No Equipment Requiring Air
  Permits

  

 

7.3                                 Are air emissions from your operation monitored?

 

	
   

  	
  Yes o

  	
  No o

  

 

If
so, indicate the frequency of monitoring and a description of the monitoring
results.

 

 

7.4                                 Attach copies of any air emissions permits
pertaining to your operations on the Premises.

 

8.                                      HAZARDOUS SUBSTANCES
DISCLOSURES

 

8.1                                 Does your company handle Hazardous
Substances in a quantity equal to or exceeding an aggregate of 500 pound, 5
gallons, or 200 cubic feet?

 

	
   

  	
  Yes o

  	
  No o

  

 

8.2                                 Has your company prepared a Hazardous
Substances management plan (“Business Plan”) pursuant to the Fire Department
requirements for the County in which the Premises is located?

 

	
   

  	
  Yes o

  	
  No o

  

 

5

 

8.3                                 Are
any of the chemicals used in your operation regulated under Proposition 65?

 

	
   

  	
  Yes o

  	
  No o

  

 

If so, describe the actions taken, or proposed actions to be taken, to
comply with the proposition.

 

8.4                                 Describe
the procedure followed to comply with OSHA Hazard Communication Standard
requirements.

 

9.                                      ENFORCEMENT
ACTIONS, COMPLAINTS

 

9.1                                 Has
your company ever been subject to any agency enforcement actions,
administrative orders, or consent decrees within the past twelve months?

 

	
   

  	
  Yes o

  	
  No o

  

 

If so, describe the actions and any continuing compliance obligations
imposed as a result of these actions.

 

9.2                                 Has your company ever
received requests for information, notice or demand letters, or any other
inquiries regarding its operation within the past twelve months?

 

	
   

  	
  Yes o

  	
  No o

  

 

9.3                                 Have there ever been,
or are there now pending, any lawsuits against the company regarding any
environmental or health and safety concerns within the past twelve months?

 

	
   

  	
  Yes o

  	
  No o

  

 

9.4                                 Has
an environmental audit ever been conducted at the Premises?

 

	
   

  	
  Yes o

  	
  No o

  

 

9.5                                 Have
there been any problems or complaints from neighbors at the Premises?

 

	
   

  	
  Yes o

  	
  No o

  

 

 

Flextronics
International USA, Inc., a California corporation

 

	
  By:

  	
   

  	
   

  
	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  
	
  Date:

  	
   

  	
   

  
					

 

6

 

 

 

WESTCORE PROPERTIES,
LLC

 

Single Tenant
Industrial/Commercial Lease

 

(Net)

 

 

Between

 

 

WESTCORE
            , LLC,

 

a Delaware limited
liability company

 

(LESSOR)

 

 

and

 

 

FLEXTRONICS
INTERNATIONAL USA, INC.,

 

a California
corporation

 

(LESSEE)

 

 

Date: December
    , 2006

 

 

 

 

TABLE OF CONTENTS

 

	
   

  	
  SUBJECT MATTER

  	
  PAGE

  
	
   

  	
   

  	
   

  
	
  Paragraph 1

  	
  BASIC PROVISIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  Paragraph 2

  	
  PREMISES AND PARKING

  	
  4

  
	
   

  	
   

  	
   

  
	
  Paragraph 3

  	
  TERM

  	
  5

  
	
   

  	
   

  	
   

  
	
  Paragraph 4

  	
  RENT

  	
  6

  
	
   

  	
   

  	
   

  
	
  Paragraph 5

  	
  INTENTIONALLY DELETED

  	
  7

  
	
   

  	
   

  	
   

  
	
  Paragraph 6

  	
  USE

  	
  7

  
	
   

  	
   

  	
   

  
	
  Paragraph 7

  	
  MAINTENANCE, REPAIR,
  UTILITY INSTALLATIONS, TRADE FIXTURES AND ALTERATIONS

  	
  10

  
	
   

  	
   

  	
   

  
	
  Paragraph 8

  	
  INSURANCE; INDEMNITY

  	
  13

  
	
   

  	
   

  	
   

  
	
  Paragraph 9

  	
  DAMAGE OR DESTRUCTION

  	
  18

  
	
   

  	
   

  	
   

  
	
  Paragraph 10

  	
  REAL PROPERTY TAXES

  	
  22

  
	
   

  	
   

  	
   

  
	
  Paragraph 11

  	
  UTILITIES

  	
  23

  
	
   

  	
   

  	
   

  
	
  Paragraph 12

  	
  ASSIGNMENT AND SUBLETTING

  	
  23

  
	
   

  	
   

  	
   

  
	
  Paragraph 13

  	
  DEFAULT; BREACH; REMEDIES

  	
  27

  
	
   

  	
   

  	
   

  
	
  Paragraph 14

  	
  CONDEMNATION

  	
  30

  
	
   

  	
   

  	
   

  
	
  Paragraph 15

  	
  BROKERS

  	
  31

  
	
   

  	
   

  	
   

  
	
  Paragraph 16

  	
  ESTOPPEL CERTIFICATES AND
  FINANCIAL STATEMENTS

  	
  31

  
	
   

  	
   

  	
   

  
	
  Paragraph 17

  	
  LESSOR’S LIABILITY

  	
  31

  
	
   

  	
   

  	
   

  
	
  Paragraph 18

  	
  SEVERABILITY

  	
  32

  
	
   

  	
   

  	
   

  
	
  Paragraph 19

  	
  INTEREST ON PAST-DUE
  OBLIGATIONS

  	
  32

  
	
   

  	
   

  	
   

  
	
  Paragraph 20

  	
  TIME OF ESSENCE

  	
  32

  
	
   

  	
   

  	
   

  
	
  Paragraph 21

  	
  RENT DEFINED

  	
  32

  
	
   

  	
   

  	
   

  
	
  Paragraph 22

  	
  NO PRIOR OR OTHER
  AGREEMENTS

  	
  32

  
	
   

  	
   

  	
   

  
	
  Paragraph 23

  	
  NOTICES

  	
  32

  
	
   

  	
   

  	
   

  
	
  Paragraph 24

  	
  WAIVERS

  	
  32

  

 

i

 

	
  Paragraph 25

  	
  RECORDING

  	
  33

  
	
   

  	
   

  	
   

  
	
  Paragraph 26

  	
  NO RIGHT TO HOLDOVER

  	
  33

  
	
   

  	
   

  	
   

  
	
  Paragraph 27

  	
  CUMULATIVE REMEDIES

  	
  33

  
	
   

  	
   

  	
   

  
	
  Paragraph 28

  	
  COVENANTS AND CONDITIONS

  	
  33

  
	
   

  	
   

  	
   

  
	
  Paragraph 29

  	
  BINDING EFFECT; CHOICE OF
  LAW

  	
  33

  
	
   

  	
   

  	
   

  
	
  Paragraph 30

  	
  SUBORDINATION; ATTORNMENT;
  NON-DISTURBANCE

  	
  33

  
	
   

  	
   

  	
   

  
	
  Paragraph 31

  	
  ATTORNEYS’ FEES

  	
  34

  
	
   

  	
   

  	
   

  
	
  Paragraph 32

  	
  LESSOR’S ACCESS; SHOWING
  PREMISES; REPAIRS

  	
  34

  
	
   

  	
   

  	
   

  
	
  Paragraph 33

  	
  AUCTIONS

  	
  35

  
	
   

  	
   

  	
   

  
	
  Paragraph 34

  	
  SIGNS

  	
  35

  
	
   

  	
   

  	
   

  
	
  Paragraph 35

  	
  TERMINATION; MERGER

  	
  35

  
	
   

  	
   

  	
   

  
	
  Paragraph 36

  	
  CONSENTS

  	
  35

  
	
   

  	
   

  	
   

  
	
  Paragraph 37

  	
  INTENTIONALLY OMITTED

  	
  35

  
	
   

  	
   

  	
   

  
	
  Paragraph 38

  	
  QUIET POSSESSION

  	
  35

  
	
   

  	
   

  	
   

  
	
  Paragraph 39

  	
  COUNTERPARTS

  	
  36

  
	
   

  	
   

  	
   

  
	
  Paragraph 40

  	
  SECURITY MEASURES

  	
  36

  
	
   

  	
   

  	
   

  
	
  Paragraph 41

  	
  RESERVATIONS

  	
  36

  
	
   

  	
   

  	
   

  
	
  Paragraph 42

  	
  PERFORMANCE UNDER PROTEST

  	
  36

  
	
   

  	
   

  	
   

  
	
  Paragraph 43

  	
  AUTHORITY

  	
  36

  
	
   

  	
   

  	
   

  
	
  Paragraph 44

  	
  CONFLICT

  	
  36

  
	
   

  	
   

  	
   

  
	
  Paragraph 45

  	
  OFFER

  	
  36

  
	
   

  	
   

  	
   

  
	
  Paragraph 46

  	
  AMENDMENTS

  	
  36

  
	
   

  	
   

  	
   

  
	
  Paragraph 47

  	
  MULTIPLE PARTIES

  	
  37

  
	
   

  	
   

  	
   

  
	
  Paragraph 48

  	
  CONSTRUCTION

  	
  37

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  PREMISES

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit B

  	
  HAZARDOUS SUBSTANCES
  SURVEY FORM

  	
   

  

 

ii

 

EXHIBIT C

 

DUE DILIGENCE MATERIALS

 

True and complete copies of the
following documents which are in Seller’s or Seller’s property manager’s
possession or control:

 

1.                                       All
contracts and agreements affecting the Property, including, without limitation,
any owners association agreements (collectively, the “Contracts”);

2.                                       All
reports or studies with respect to the Property;

3.                                       Any
notices (including inspection reports) received from any governmental agency;

4.                                       The
name and address of Seller’s insurance company and agent and all insurance
policies or certificates of insurance procured with respect to the Property by
Seller and a list of all claims for more than $1,000.00 filed under all
insurance policies for the Property during the most recent three (3) years;

5.                                       All
environmental site assessment reports, monitoring reports and similar
information with respect to hazardous materials on or under the Property,
together with all correspondence, test results, orders, permits and O&M
manuals relating to hazardous materials on the Property;

6.                                       Certificates
of compliance and occupancy, governmental permits, variances, approvals,
entitlements, operating licenses and other licenses held or applied for by
Seller and relating to the Property (collectively, the “Permits”);

7.                                       All
plans, specifications, drawings and similar documents relating to the Property,
including, but not limited to, all as-built architectural, civil, mechanical,
electrical, sprinkler, plumbing and structural engineering plans and drawings,
and all other as-built drawings or plans prepared for Improvements constructed
or to be constructed on the Property or otherwise relating to the Property
(collectively, the “Plans”);

8.                                       All
ALTA surveys, topographical surveys, aerial photos, FEMA maps, boundary maps,
tentative and final maps and similar engineering drawings of the Property;

9.                                       All
warranties, guaranties and indemnities made by or received from any third party
with respect to any part of the Land, Improvements and Personal Property and
pursuant to or under the Licenses and Permits (collectively, the “Warranties”);

10.                                 Property
tax bills for the current year and the two (2) previous property tax fiscal
years;

11.                                 Utility
bills for the current year and the two (2) most recent full calendar years;

12.                                 A
list of the Personal Property and all vendors presently employed by Seller;

13.                                 A
schedule of all capital expenditures and capital improvements made to the
Property during the current year and the three (3) most recent full calendar
years; and

14.                                 List
of Utilities, with account numbers.

 

1

 

EXHIBIT D

 

	
   

  	
  Re:

  	
  600, 620,
  640, and 780

  
	
   

  	
   

  	
  Shiloh Road,
  Plano, Texas

  

 

NOTICE OF
CONFIDENTIALITY RIGHTS:

 

IF YOU ARE
A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OF THE FOLLOWING INFORMATION
FROM THIS INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS:  YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER’S
LICENSE NUMBER.

 

SPECIAL WARRANTY DEED

 

	
  THE STATE OF
  TEXAS

  	
  §

  	
   

  
	
   

  	
  §

  	
  KNOW ALL
  PERSONS BY THESE PRESENTS:

  
	
  COUNTY OF COLLIN

  	
  §

  	
   

  

 

THAT, FLEXTRONICS INTERNATIONAL USA, INC., a California
corporation (“Grantor”), for and in consideration of the sum of Ten and
No/100 Dollars ($10.00) and other good and valuable consideration in hand paid
to Grantor by                                        
(“Grantee”), whose mailing address is                                        ,
the receipt and sufficiency of such consideration being hereby acknowledged,
has GRANTED, SOLD AND CONVEYED and by these presents does GRANT, SELL AND
CONVEY unto Grantee that certain real property being more particularly
described in Exhibit A (the “Real Property”) attached hereto
and made a part hereof, together with all improvements, structures and fixtures
(other than trade fixtures) (collectively, the “Improvements”) located
thereon, and all easements, appurtenances, development rights, mineral rights,
water rights, air rights, and other rights and privileges belonging or
appertaining to the Real Property and Improvements, and all right, title and
interest in, to and under adjoining streets, rights of way and access
easements.

 

TO HAVE AND TO
HOLD the Real Property, together with all and singular the rights, easements
and appurtenances thereto in anywise belonging thereto, unto the said Grantee,
its successors and assigns forever, subject to the Permitted Exceptions listed
in Exhibit B, attached hereto and made a part hereof, and Grantor does
hereby bind itself, and its successors to WARRANT AND FOREVER DEFEND all and
singular the said premises unto the said Grantee, its successors and assigns,
against Grantor, Grantor’s successors, and all and every person or persons
whomsoever, lawfully claiming or to claim the same by, through or under
Grantor.

 

 

[SEE SIGNATURE ON THE FOLLOWING PAGE]

 

1

 

IN WITNESS
WHEREOF, this instrument has been executed as of (but not necessarily on) this         
day of              ,
2006.

 

	
   

  	
  GRANTOR:

  
	
   

  	
   

  
	
   

  	
  FLEXTRONICS
  INTERNATIONAL USA, INC.,

  
	
   

  	
  a California
  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					

 

 

	
  THE STATE OF
                               

  	
  §

  	
   

  
	
   

  	
  §

  	
  KNOW ALL MEN
  BY THESE PRESENTS:

  
	
  COUNTY OF                                   

  	
  §

  	
   

  

 

On this        
day of                ,
2006, before me, appeared                    ,
to me personally known, who, being by me duly sworn did say that he is the                            
of Flextronics International USA, Inc., a California corporation, and said                               
acknowledged said instrument to be the free act and deed of said corporation.

 

IN WITNESS
WHEREOF, I have hereunto set my hand and affixed my notarial seal today and
year last above written.

 

 

	
   

  	
  Notary
  Public, State of

  	
   

  

 

 

	
  My
  Commission Expires:

  	
   

  	
  Notary’s
  name printed:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  THIS
  INSTRUMENT DRAFTED

  	
   

  	
   

  	
  NAME AND ADDRESS
  OF GRANTEE

  
	
  BY AND AFTER
  RECORDING

  	
   

  	
   

  	
  WHERE FUTURE
  TAX STATEMENTS

  
	
  PLEASE RETURN TO:

  	
   

  	
   

  	
   

  	
  SHOULD BE DELIVERED:

  	
   

  
								

 

2

 

EXHIBIT A TO SPECIAL WARRANTY DEED

 

REAL PROPERTY

 

3

 

EXHIBIT B TO SPECIAL WARRANTY DEED

 

LIST OF PERMITTED EXCEPTIONS

 

4

 

EXHIBIT E

 

GENERAL ASSIGNMENT

 

This General
Assignment (the “Assignment”) is made and entered into as of this       
day of                         ,
2006 (the “Assignment Date”), by and between Flextronics International
USA, Inc., a California corporation (“Assignor”), and                   ,
a                                                    
(“Assignee”), with reference to the following facts.

 

RECITALS

 

A.                                    Assignor
and Assignee are parties to that certain Purchase, Sale and Leaseback Agreement
made and entered into as of                   ,
2006, as assigned to Assignee (the “Purchase Agreement”) pursuant to
which Assignor agreed to sell to Assignee, and Assignee agreed to purchase from
Assignor that certain improved real property located at  600, 620, 640, and 780 Shiloh Road, Plano,
Texas, as legally described in Exhibit A attached hereto (the “Real Property”),
together with all (i) improvements, structures, fixtures (other than trade
fixtures), and equipment (collectively, the “Improvements”), (ii) personal
property (the “Personal Property”) owned by Assignor (if any) located in
or about the Real Property or the Improvements, (iii) intangible property and
interests, tradenames and similar property (collectively, the “Intangible
Property”), (iv) easements, appurtenances, development rights, mineral
rights, water rights, air rights, and all other rights and privileges appertaining
to the Real Property and Improvements (collectively, the “Appurtenances”),
(v) certificates of compliance, certificates of occupancy, governmental
permits, variances, approvals, entitlements, operating licenses and other
licenses obtained, applied for or otherwise held by Assignor, and relating to
any part of the Property (collectively, the “Permits”), and (vi) all
warranties, guaranties and indemnities made by or received from any third party
with respect to any part of the Real Property, Improvements and Personal
Property and pursuant to or under the Licenses and Permits (collectively, the “Warranties”).
The Real Property, the Improvements, the Personal Property, the Intangible
Property, the Appurtenances, the Licenses, the Permits and the Warranties are
collectively referred to herein as the “Property.”  All capitalized terms used but not otherwise
defined herein shall have the meanings ascribed to such terms in the Purchase
Agreement.

 

B.                                    A
list of all the Permits and the Warranties affecting the Property which
Assignee approved pursuant to the provisions of the Purchase Agreement are
attached hereto as Schedules 1 and 2, respectively.

 

C.                                    Assignee
has acquired fee title to the Property from Assignor on the Assignment Date. Assignor
now desires to assign and transfer to Assignee all of Assignor’s right, title
and interest in, to and under the Licenses, Permits, Warranties and Intangible
Property, as set forth herein.

 

NOW, THEREFORE, for valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereto
agree as follows:

 

1

 

1.                                      Assignment
of Permits, Warranties and Intangibles. Effective as of the Assignment
Date, Assignor hereby grants, transfers, conveys, bargains, assigns and
delegates to Assignee all of Assignor’s right, title, and interest in, to and
under (i)  the Permits as listed in Schedule 1 hereto; (ii) the
Warranties as listed in Schedule 2 hereto; and (iii) all Intangible
Property. Assignee hereby accepts such assignment. Assignee is not assuming any
liability or obligation of Assignor relating to or arising from Assignor’s
performance of, or failure to perform, any of Assignor’s obligations under or
with respect to Licenses, Permits or Warranties to the extent first arising or
accruing prior to the Assignment Date.

 

2.                                      Assignor’s
Representations. Assignor does hereby covenant with Assignee, and
represents and warrants to Assignee, that Assignor has the right to bargain,
convey, assign and transfer to Assignee each of the Permits, Warranties and
Intangible Property (collectively, the “Interests”). Assignor further
represents and warrants that Assignor has received no written notice that any
of the Interests are not in full force and effect (except as the same may have
expired in accordance with their respective terms) or that there exist any
defaults thereunder, or that any acts or events which, with the passage of time
or the giving of notice or both, could become defaults thereunder, on the part
of any party thereto.

 

3.                                      Dispute
Costs. In the event of any dispute between Assignor and Assignee arising
out of the obligations of the parties under this Assignment or concerning the
meaning or interpretation of any provision contained herein, the losing party
shall pay the prevailing party’s costs and expenses of such dispute, including
without limitation, reasonable attorneys’ fees and costs. Any such attorneys’
fees and other expenses incurred by either party in enforcing a judgment in its
favor under this Assignment shall be recoverable separately from and in
addition to any other amount included in such judgment, and such attorneys’
fees obligation is intended to be severable from the other provisions of this
Assignment and to survive and not be merged into any such judgment.

 

4.                                      Counterparts;
Facsimile Signatures. This Assignment may be executed in counterparts. All
executed counterparts shall constitute one agreement, and each counterpart
shall be deemed an original. The parties agree that the delivery of an executed
copy of this Assignment by facsimile shall be legal and binding and shall have
the same full force and effect as if an original of this Assignment had been
delivered. Facsimile signatures shall be binding upon the parties.

 

5.                                      Survival.
This Assignment and Assignor’s foregoing representations, covenants and
warranties shall survive the Closing for the Survival Period and shall run to
the benefit of Assignee and Assignee’s successors and assigns. Notwithstanding
the foregoing, the provisions of Section 4 of this Assignment shall survive the
Closing and the termination of the Licenses.

 

6.                                      Governing
Law. This Assignment shall be enforced, governed by, and construed in
accordance with the laws of the State of Texas.

 

7.                                      Warranty of
Authority. The signatories hereto represent that they have full and
complete authority to bind their respective parties to this Assignment and that
no other consent is 

 

2

 

necessary or required in order
for the signatories to execute this Assignment on behalf of their respective
parties.

 

8.                                      Severability.
If for any reason, any provision of this Assignment shall be held to be
unenforceable, it shall not affect the validity or enforceability of any other
provision of this Assignment and to the extent any provision of this Assignment
is not determined to be unenforceable, such provision, or portion thereof,
shall be, and remain, in full force and effect.

 

IN WITNESS WHEREOF, the parties hereto have
executed this Assignment as of the Assignment Date.

 

ASSIGNOR:

 

FLEXTRONICS
INTERNATIONAL USA, INC.,

a California corporation

 

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  

 

 

ASSIGNEE:

 

 

	
  ,

  	
   

  
	
  a

  	
   

  	
   

  
			

 

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  

 

3

 

EXHIBIT F

 

BILL OF SALE

 

For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Flextronics International USA, Inc., a
California corporation (“Seller”), does hereby GRANT, SELL, CONVEY,
TRANSFER and DELIVER to [                               ],
a Delaware limited liability company (“Purchaser”), all of Seller’s
right, title and interest in and to the personal property (the “Personal
Property”) owned by Seller and located in or about the real property known
as and numbered 600, 620, 640, and 780 Shiloh Road, Plano, Texas (the “Property”)
and not utilized by Seller in its operation of its business but rather utilized
for purposes of operating and maintaining the Property, specifically excluding
the Personal Property set forth on Exhibit A attached hereto and made a
part hereof.

 

From and after the date of this Bill of Sale, Purchaser and its
successors and assigns shall have the right to use, have, hold and own the
Personal Property forever. Seller hereby covenants, represents and warrants
that Seller is the lawful owner of the Personal Property and the Personal
Property is free from any liens and encumbrances.

 

Seller hereby warrants that it has good and marketable title to the
Personal Property and Seller hereby agrees to defend Purchaser and its successors
and assigns from any and all claims made with respect to, or against title to,
the Personal Property from and after the date of this Bill of Sale.

 

IN WITNESS WHEREOF,
the Seller has executed this Bill of Sale as of this         
day of                           ,
2006.

 

SELLER:

 

FLEXTRONICS
INTERNATIONAL USA, INC.,

a California corporation

 

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  

 

1

 

EXHIBIT A TO BILL OF SALE

 

EXCLUDED PERSONAL PROPERTY

 

2

 

EXHIBIT G

 

EXCLUDED PERSONAL PROPERTY

 

	
   

  	
   

  	
  Make

  	
   

  	
  Model

  	
   

  	
  Serial No.

  
	
  600 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Compressor
  #1

  	
   

  	
  ATLAS COPCO

  	
   

  	
  GA
  75FF

  	
   

  	
  AII474075

  
	
  Compressor
  #2

  	
   

  	
  ATLAS COPCO

  	
   

  	
  GA-37FF

  	
   

  	
  AII364388H

  
	
  Compressor
  #3

  	
   

  	
  ATLAS COPCO

  	
   

  	
  GA-37FF

  	
   

  	
  AII364323H

  
	
  Receiver
  Tank#1

  	
   

  	
  MANCHESTER

  	
   

  	
  1550

  	
   

  	
  581035

  
	
  Receiver
  Tank#2

  	
   

  	
  SILVAN

  	
   

  	
  920900567

  	
   

  	
  805785

  
	
  Vacuum
  Pumps #1

  	
   

  	
  BUSCH

  	
   

  	
  RC0400.B033.1014

  	
   

  	
  C6505

  
	
  Vacuum
  Pumps #2

  	
   

  	
  BUSCH

  	
   

  	
  RC.0400.B033.1016

  	
   

  	
  C6448

  
	
  Vacuum
  Pumps #3

  	
   

  	
  BUSCH

  	
   

  	
  B0034FLB2AM

  	
   

  	
  94Z11986

  
	
  Vacuum
  Pumps #4

  	
   

  	
  BUSCH

  	
   

  	
  B0034FLB2AM

  	
   

  	
  94Y01795

  
	
  Compactor

  	
   

  	
  GALBREATH

  	
   

  	
  PF6040

  	
   

  	
  SC4880

  
	
  Bulk
  Nitrogen Tank

  	
   

  	
  RYAN

  	
   

  	
  N\A

  	
   

  	
  2382

  
	
  D/I Skid
  #1

  	
   

  	
  IONICS

  	
   

  	
  65
  GAL

  	
   

  	
  N/A

  
	
  D/I Skid
  #2

  	
   

  	
  IONICS

  	
   

  	
  150
  GAL

  	
   

  	
  N/A

  
	
  D/I Skid
  #3

  	
   

  	
  IONICS

  	
   

  	
  15
  GAL

  	
   

  	
  N/A

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  620 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  None

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  640 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Compressor
  #1

  	
   

  	
  ATLAS COPCO

  	
   

  	
  GA
  90FF

  	
   

  	
  AIF076473

  
	
  Compressor
  #2

  	
   

  	
  ATLAS COPCO

  	
   

  	
  GA
  90FF

  	
   

  	
  AIF076474

  
	
  Receiver
  Tank

  	
   

  	
  MANCHESTER

  	
   

  	
  660

  	
   

  	
  572514

  
	
  Compactor
  #1

  	
   

  	
  GALBREATH

  	
   

  	
  PF6040

  	
   

  	
  SC4879

  
	
  Compactor
  #2

  	
   

  	
  GALBREATH

  	
   

  	
  PF6040

  	
   

  	
  SC4695

  
	
  Compactor
  #3

  	
   

  	
  GALBREATH

  	
   

  	
  PF6040

  	
   

  	
  N\A

  
	
  Bulk
  Nitrogen Tank

  	
   

  	
  UCAR

  	
   

  	
  5712

  	
   

  	
  TM6000
  6652

  
	
  Bulk
  Oxygen Tank

  	
   

  	
  TAYLOR WHARTON

  	
   

  	
  25903

  	
   

  	
  TW1500
  G1688

  
	
  Storage
  Shed #1

  	
   

  	
  SECURALL

  	
   

  	
  B600

  	
   

  	
  N\A

  
	
  Storage
  Shed #2

  	
   

  	
  SECURALL

  	
   

  	
  B1200

  	
   

  	
  N\A

  
	
  Bulk
  Argon Tank

  	
   

  	
  UCAR

  	
   

  	
  1193

  	
   

  	
  TM3000
  E1123

  

 

1

 

	
   

  	
   

  	
  Make

  	
   

  	
  Model

  	
   

  	
  Serial No.

  
	
  780 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  None

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  600 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Access
  Control Equipment

  
	
  Controller

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2

  
	
  Card
  Reader

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  33

  
	
  REX

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  32

  
	
  Mag lock

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  10

  
	
  Door
  Strike

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  20

  
	
  600 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  CCTV
  Equipment

  
	
  Fixed

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  16

  
	
  PTZ

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2

  
	
  DVR

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  620 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Access
  Control Equipment

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  None

  
	
  620 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  CCTV
  Equipment

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  None

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  640 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Access
  Control Equipment

  
	
  Controller

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2

  
	
  Card
  Reader

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  30

  
	
  REX

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  30

  
	
  Mag lock

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  11

  
	
  Door
  Strike

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  18

  
	
  640 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  CCTV
  Equipment

  
	
  Fixed

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  25

  
	
  PTZ

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2

  
	
  DVR

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  780 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Access
  Control Equipment

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  None

  
	
  780 Shiloh Road

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  CCTV Equipment

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  None

  

 

1

 

EXHIBIT H

 

COUNTRYWIDE COMMERCIAL REAL ESTATE FINANCE,
INC.

 

TENANT ESTOPPEL CERTIFICATE 

 

TO:                            Countrywide Commercial Real
Estate Finance, Inc. (together with its successors and assigns, “Lender”)
and Westcore           , LLC,
a Delaware limited liability company (“Landlord”)

 

	
  Landlord:

  	
   

  	
  WESTCORE
                 ,
  LLC,

  
	
   

  	
   

  	
  a Delaware limited liability
  company

  
	
   

  	
   

  	
   

  
	
  Tenant:

  	
   

  	
  FLEXTRONICS INTERNATIONAL USA, INC.,

  
	
   

  	
   

  	
  a California corporation

  
	
   

  	
   

  	
   

  
	
  Leased Premises:

  	
   

  	
  600, 620, and 640 Shiloh Road, Plano, Texas

  

 

Square Footage
of leasable floor area:                
sq. ft.

 

Tenant hereby
certifies and confirms the accuracy of this Certificate as of the date hereof,
with the intent that the same be relied upon for the making of a loan by Lender
to Landlord or its successor in interest, secured by, among other things, a
mortgage or deed of trust on the property of which the Leased Premises is a
part and an assignment of rents under the Lease.

 

1.                                       Tenant
is tenant under that certain lease (the “Lease”) dated                 ,
2006, with Landlord with respect to the Leased Premises. The Lease is the
entire agreement among the parties thereto concerning the Leased Premises and
is now in full force and effect, and has not been amended or modified. If the
landlord named in the Lease is not Landlord, Tenant recognizes Landlord as the
landlord under the Lease.

 

2.                                       Tenant
is in full and complete possession of the Leased Premises, and such possession
has been delivered by Landlord, or its predecessor in title, pursuant to the
Lease and has been accepted by Tenant. Tenant has not assigned, transferred,
pledged, mortgaged, sublet, licensed, concessioned, vacated, discontinued its
business, nor entered into any agreement to transfer any of Tenant’s interest
or any right of use or occupancy in the Leased Premises, except:  NONE.

 

3.                                       The
improvements and space required to be furnished under the Lease have been
completed in all respects and to the satisfaction of Tenant, and are open for
the use of Tenant, its employees, customers and invitees, and all other
conditions precedent to Tenant’s obligations under the Lease have been
fulfilled.

 

1

 

4.                                       The
Lease term commenced on                           .
The Lease term, excluding renewals or extensions, terminates on                        ,
2016. Tenant has no right to renew or extend the current term of its Lease or
to lease additional space except as follows: 
Two (2) options to renew for five (5) years each.

 

5.                                       Tenant
has no right of first refusal, option or other right to lease or purchase the
Leased Premises or property of which the Leased Premises is a part, nor does
Tenant have any right to unilaterally terminate the Lease, except for a right
to terminate the Lease effective              ,
2013 (the “termination date”) by giving Landlord written notice at least one
hundred eighty (180) days prior to such termination date.

 

6.                                       Rents
provided in the Lease commenced to accrue on                            .

 

7.                                       Tenant’s
proportionate share of expenses is 100%. As of the date hereof, Tenant has paid
Landlord all amounts due through the month of
                ,
which payments are comprised of the following:

 

a.                                       security
deposit of $0.00;

 

b.                                      monthly
base rent, which is currently $                     ;

 

c.                                       monthly
additional rent, imposed in connection with Tenant’s obligation, if any, to
contribute to the payment of real estate taxes, insurance premiums, common area
maintenance and other charges due under the Lease.

 

d.                                      all
other monthly additional rent, for the following items for the following
amounts: NONE.

 

8.                                       Tenant
is not in arrears for any rent or other charges payable by Tenant under the
Lease, there is no existing default on the part of Tenant or, to Tenant’s
knowledge, on the part of the Landlord under the Lease, and to Tenant’s
Knowledge, there are no events currently existing or which with the passage of
time, giving of notice or both would be deemed a default of Landlord or which
would give Tenant the right to cancel or terminate the Lease.

 

9.                                       Tenant
has not prepaid rents more than thirty (30) days in advance of their due dates,
and Tenant has not asserted, and has no knowledge of, any claim against the
Landlord under the Lease that might constitute or give rise to a set-off or
credit against rents, whether for “free rent,” rent abatement, other rental
concessions, or other offsets or credits now or in the future, except as
follows: NONE.

 

10.                                 There
are no actions, whether voluntary or otherwise, pending against Tenant under
the bankruptcy or other insolvency laws of the United States or any state
thereof.

 

11.                                 Tenant
has not received notice to pay rent to someone other than to Landlord.

 

2

 

12.                                 Tenant
is not, to Tenant’s Knowledge, in violation of and has not received any notice
of violation of law relating to the use or Tenant’s occupancy of the Leased
Premises, whether environmental, zoning, safety, fire, health, or other
ordinance.

 

13.                                 The
representations, covenants and agreements made herein shall inure to the
benefit of, and may be relied on by Lender, Landlord and their respective
successors and assigns.

 

 

Very truly yours,

 

FLEXTRONICS INTERNATIONAL USA,
INC.,

a California corporation

 

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

DATE:  October     ,
2006

 

3Exhibit 10.43

 

ASSIGNMENT OF PURCHASE, SALEAND LEASEBACK AGREEMENT

(600, 620 and 640 Property)

 

THIS
ASSIGNMENT OF PURCHASE, SALE AND LEASEBACK AGREEMENT (this “Assignment”) is made and entered into as of December 15,
2006 (the “Assignment Date”), by and between
WESTCORE PROPERTIES AC, LLC, a Delaware limited liability company (“Assignor”), and WESTCORE SHILOH, LLC, a Delaware limited
liability company (“Assignee”).

 

A.                                    Assignor and FLEXTRONICS INTERNATIONAL USA,
INC., a California corporation (“Seller”), entered
into that certain Purchase, Sale and Leaseback Agreement, dated as of November
8, 2006, as subsequently amended (collectively, the “Purchase
Agreement”), wherein Seller agreed to sell and Assignor agreed to
purchase improved real property located at 600, 620, 640, and 780 Shiloh Road,
Plano, Texas, and certain other interests (as more particularly described in
the Purchase Agreement as the “Property”).

 

B.                                    Assignor desires to separate the 600-640
Property (defined below) from the balance of the Property and assign all of its
right, title and interest in and to that portion of the Property known as 600,
620 and 640 Shiloh Road, Plano, Texas (the “600-640
Property”) under the Purchase Agreement to Assignee, effective as of
the Assignment Date.

 

C.                                    Assignee desires to accept such assignment
and assume all of Assignor’s rights, duties, obligations and liabilities under
the Purchase Agreement with respect only to the 600-640 Property (collectively,
the “Obligations”), on the terms and
provisions contained herein.

 

NOW, THEREFORE,
in consideration of the mutual promises herein contained and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

 

1.                                       Definitions. Unless otherwise defined in this Assignment, all capitalized terms
used herein shall have the meanings ascribed to them in the Purchase Agreement.

 

2.                                       Assignment. Assignor hereby transfers, assigns and sets over to Assignee, its
successors and assigns, all of Assignor’s right, title and interest in, to and
under the Purchase Agreement with respect to the 600-640 Property.

 

3.                                       Assumption. Assignee hereby agrees and confirms that effective as of the
Assignment Date, Assignee has assumed all of the Obligations, and is presently
bound by all conditions and agreements applicable to Assignor, under and with
respect to the Purchase Agreement, to the extent related to the 600-640
Property.

 

4.                                       No Release of Assignor. No assignment of the Purchase Agreement
shall relieve Assignor of any liability or its obligations under or in
connection with the Purchase Agreement, to the extent related to the 600-640
Property.

 

5.                                       Delivery to Seller. Assignor shall promptly deliver to Seller a
copy of this Assignment, fully executed by Assignor and Assignee, after the
mutual execution hereof by the parties.

 

1

 

6.                                       Severability. If for any reason,
any provision of this Assignment shall be held to be unenforceable, it shall
not affect the validity or enforceability of any other provision of this
Assignment and to the extent any provision of this Assignment is not determined
to be unenforceable, such provision, or portion thereof, shall be, and remain,
in full force and effect.

 

7.                                       Authority to Contract. The signatories hereto represent that they
have full and complete authority to bind their respective parties to this
Assignment and that no other consent is necessary or required in order for the
signatories to execute this Assignment on behalf of their respective parties.

 

8.                                       Dispute Costs. In the event any dispute between the parties
with respect to this Assignment results in litigation or other proceeding, the
prevailing party shall be reimbursed by the party not prevailing in such
proceeding for all reasonable costs and expenses, including, without
limitation, reasonable attorneys’ and experts’ fees and costs incurred by the
prevailing party in connection with such litigation or other proceeding and any
appeal thereof. Such costs, expenses and fees shall be included in and made a
part of the judgment recovered by the prevailing party, if any.

 

9.                                       Counterparts;
Signatures. This Assignment
may be executed in counterparts. All executed counterparts shall constitute one
agreement, and each counterpart shall be deemed an original. The parties hereby
acknowledge and agree that the delivery of an executed copy of this Assignment
by facsimile signatures or an executed copy of this Assignment transmitted by
electronic mail in so-called “pdf” format shall be legal and binding and shall
have the same full force and effect as if an original of this Assignment had
been delivered. Assignor and Assignee (i) intend to be bound by the signatures
on any document sent by facsimile or electronic mail, (ii) are aware that the
other party will rely on such signatures, and (iii) hereby waive any defenses
to the enforcement of the terms of this Assignment based on the foregoing forms
of signature

 

10.                                 Governing Law. This Assignment shall be governed by, and
construed in accordance with, the laws of the State of California.

 

11.                                 Entire
Agreement/Modifications. This Assignment, including exhibits, if any, expresses
the entire agreement of the parties and supersedes any and all previous
agreements between the parties with regard to the subject matter hereof. There
are no other understandings, oral or written, which in any way alter or enlarge
its terms, and there are no warranties or representations of any nature
whatsoever, either expressed or implied, except as may expressly be set forth
herein. Any and all future modifications of this Assignment will be effective
only if it is in writing and signed by the parties hereto. The terms and
conditions of such future modifications of this Assignment shall supersede and
replace any inconsistent provisions in this Assignment.

 

///signature
page follows///

 

2

 

IN WITNESS WHEREOF, Assignor and Assignee have duly executed this Assignment as of the
date and year first above written.

 

ASSIGNOR:

 

WESTCORE
PROPERTIES AC, LLC,

a
Delaware limited liability company

 

 

	
  By:

  	
  /s/ Manish
  Malhotra

  	
   

  
	
  Name:

  	
  Manish
  Malhotra

  	
   

  
	
  Title:

  	
  Vice President

  	
   

  

 

 

ASSIGNEE:

 

WESTCORE SHILOH, LLC,

a Delaware limited liability company

 

	
  By:

  	
  Westcore Shiloh Partners,

  
	
   

  	
  a Delaware general partnership,

  
	
   

  	
  its Sole Member

  

 

	
   

  	
  By:

  	
  WP Shiloh, LLC,

  
	
   

  	
   

  	
  a Delaware limited liability company,

  
	
   

  	
   

  	
  its Managing Partner

  

 

	
   

  	
  By:

  	
  MRB Manager, LLC,

  
	
   

  	
   

  	
  a Delaware limited liability company,

  
	
   

  	
   

  	
  its Manager

  

 

	
   

  	
  By:

  	
  /s/ Manni Malhotra

  	
   

  
	
   

  	
  Name:

  	
  Manni Malhotra

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  

 

3

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