Document:

Exhibit 10.8

 

CREDIT AGREEMENT

 

THIS AGREEMENT
is entered into as of May 1, 2003, by and between FIRST CONSULTING GROUP, INC.,
a Delaware corporation (“Borrower”), and WELLS FARGO BANK, NATIONAL ASSOCIATION
(“Bank”).

 

RECITALS

 

Borrower has
requested that Bank extend or continue credit to Borrower as described below,
and Bank has agreed to provide such credit to Borrower on the terms and
conditions contained herein.

 

NOW,
THEREFORE, for valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Bank and Borrower hereby agree as follows:

 

ARTICLE I

CREDIT TERMS

 

SECTION 1.1.                       LINE
OF CREDIT.

 

(a)                                  Line
of Credit.  Subject to the terms and
conditions of this Agreement, Bank hereby agrees to make advances to Borrower
from time to time up to and including May 3, 2004, not to exceed at any time
the aggregate principal amount of Seven Million Dollars ($7,000,000.00) (“Line
of Credit”), the proceeds of which shall be used for working capital
requirements.  Borrower’s obligation to
repay advances under the Line of Credit shall be evidenced by a promissory note
substantially in the form of Exhibit A attached hereto (“Line of Credit Note”),
all terms of which are incorporated herein by this reference.

 

(b)                                 Letter
of Credit Subfeature.  As a subfeature
under the Line of Credit, Bank agrees from time to time during the term thereof
to issue or cause an affiliate to issue standby letters of credit for the
account of Borrower to back performance instruments (each, a “Letter of Credit”
and collectively, “Letters of Credit”); provided however, that the aggregate
undrawn amount of all outstanding Letters of Credit shall not at any time
exceed One Million Dollars ($1,000,000.00). 
The form and substance of each Letter of Credit shall be subject to
approval by Bank, in its sole discretion. 
No Letter of Credit shall have an expiration date subsequent to the
maturity date of the Line of Credit. 
The undrawn amount of all Letters of Credit shall be reserved under the
Line of Credit and shall not be available for borrowings thereunder.  Each Letter of Credit shall be subject to
the additional terms and conditions of the Letter of Credit agreements,
applications and any related documents required by Bank in connection with the
issuance thereof.  Each drawing paid
under a Letter of Credit shall be deemed an advance under the Line of Credit
and shall be repaid by Borrower in accordance with the terms and conditions of
this Agreement applicable to such advances; provided however, that if advances
under the Line of Credit are not available, for any reason, at the time any
drawing is paid, then Borrower shall immediately pay to Bank the full amount
drawn, together with interest thereon from the date such drawing is paid to the
date such amount is fully repaid by Borrower, at the rate of interest
applicable to advances under the Line of Credit.  In such event Borrower agrees that Bank, in its sole discretion,
may debit any account maintained by Borrower with Bank for the amount of any
such drawing.

 

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(c)                                  Borrowing and Repayment.  Borrower may from time to time during the
term of the Line of Credit borrow, partially or wholly repay its outstanding
borrowings, and reborrow, subject to all of the limitations, terms and conditions
contained herein or in the Line of Credit Note; provided however, that the
total outstanding borrowings under the Line of Credit shall not at any time
exceed the maximum principal amount available thereunder, as set forth above.
Notwithstanding the foregoing, Borrower shall maintain a zero balance on
advances under the Line of Credit for a period of at least thirty (30)
consecutive days during the term of the Line of Credit.

 

SECTION 1.2.                       INTEREST/FEES.

 

(a)                                  Interest.  The outstanding principal balance of the
Line of Credit shall bear interest at the rate of interest set forth in the
Line of Credit Note.

 

(b)                                 Computation and Payment.  Interest shall be computed on the basis of a
360-day year, actual days elapsed. 
Interest shall be payable at the times and place set forth in each
promissory note or other instrument or document required hereby.

 

(c)                                  Unused Commitment Fee.  Borrower shall pay to Bank a fee equal to
two-tenths percent (.20%) per annum (computed on the basis of a 360-day year,
actual days elapsed) on the average daily unused amount of the Line of Credit,
which fee shall be calculated on a calendar quarter basis by Bank and shall be
due and payable by Borrower in arrears on the last day of each calendar
quarter.

 

(d)                                 Letter of Credit Fees.  Borrower shall pay to Bank (i) fees upon the
issuance of each Letter of Credit equal to two percent (2.00%) per annum
(computed on the basis of a 360-day year, actual days elapsed) of the face
amount thereof, and (ii) fees upon the payment or negotiation of each drawing
under any Letter of Credit and fees upon the occurrence of any other activity
with respect to any Letter of Credit (including without limitation, the
transfer, amendment or cancellation of any Letter of Credit) determined in
accordance with Bank’s standard fees and charges then in effect for such
activity.

 

SECTION 1.3.                       COLLECTION OF PAYMENTS.  Borrower authorizes Bank to collect all
interest and fees due under the Line of Credit by charging Borrower’s deposit
account number 4624028767 with Bank, or any other deposit account maintained by
Borrower with Bank, for the full amount thereof.  Should there be insufficient funds in any such deposit account to
pay all such sums when due, the full amount of such deficiency shall be
immediately due and payable by Borrower.

 

SECTION 1.4.                       COLLATERAL.

 

As security for all indebtedness of Borrower to Bank under the Line of
Credit, Borrower hereby grants to Bank security interests of first priority in
all Borrower’s accounts receivable and other rights to payment, general
intangibles and equipment.

 

All of the foregoing shall be evidenced by and subject to the terms of
such security agreements, financing statements, deeds of trust and other
documents as Bank shall reasonably require, all in form and substance
satisfactory to Bank.  Borrower shall
reimburse Bank within five (5) days of Bank’s demand, therefor, for all
reasonable costs and expenses incurred by Bank in connection with any of the
foregoing security, including without limitation, filing and recording fees and
costs of appraisals, audits and title insurance.

 

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ARTICLE II

REPRESENTATIONS AND
WARRANTIES

 

Borrower makes the following representations and
warranties to Bank, which representations and warranties shall survive the
execution of this Agreement and shall continue in full force and effect until
the full and final payment, and satisfaction and discharge, of all obligations
of Borrower to Bank subject to this Agreement.

 

SECTION 2.1.                       LEGAL STATUS.  Borrower is a corporation, duly organized
and existing and in good standing under the laws of the State of Delaware, and
is qualified or licensed to do business (and is in good standing as a foreign
corporation, if applicable) in all jurisdictions in which such qualification or
licensing is required or in which the failure to so qualify or to be so
licensed could have a material adverse effect on Borrower.

 

SECTION 2.2.                       AUTHORIZATION AND
VALIDITY.  This Agreement and each
promissory note, contract, instrument and other document required hereby or at
any time hereafter delivered to Bank in connection herewith (collectively, the
“Loan Documents”) have been duly authorized, and upon their execution and
delivery in accordance with the provisions hereof will constitute legal, valid
and binding agreements and obligations of Borrower or the party which executes
the same, enforceable in accordance with their respective terms.

 

SECTION 2.3.                       NO VIOLATION.  The execution, delivery and performance by
Borrower of each of the Loan Documents do not violate any provision of any law
or regulation, or contravene any provision of the Articles of Incorporation or
By-Laws of Borrower, or result in any breach of or default under any contract,
obligation, indenture or other instrument to which Borrower is a party or by
which Borrower may be bound.

 

SECTION 2.4.                       LITIGATION.  There are no pending, or to the best of
Borrower’s knowledge threatened, actions, claims, investigations, suits or
proceedings by or before any governmental authority, arbitrator, court or
administrative agency which could have a material adverse effect on the
financial condition or operation of Borrower other than those disclosed by
Borrower to Bank in writing prior to the date hereof.

 

SECTION 2.5.                       CORRECTNESS OF FINANCIAL
STATEMENT.  The financial statement of
Borrower dated December 28, 2002, a true copy of which has been delivered by
Borrower to Bank prior to the date hereof, (a) is complete and correct and
presents fairly the financial condition of Borrower, (b) discloses all
liabilities of Borrower that are required to be reflected or reserved against
under generally accepted accounting principles, whether liquidated or
unliquidated, fixed or contingent, and (c) has been prepared in accordance with
generally accepted accounting principles consistently applied.  Since the date of such financial statement
there has been no material adverse change in the financial condition of
Borrower, nor has Borrower mortgaged, pledged, granted a security interest in
or otherwise encumbered any of its assets or properties except in favor of Bank
or as otherwise permitted by Bank in writing.

 

SECTION 2.6.                       INCOME TAX RETURNS.  Borrower has no knowledge of any pending
assessments or adjustments of its income tax payable with respect to any year.

 

SECTION 2.7.                       NO SUBORDINATION.  There is no agreement, indenture, contract
or instrument to which Borrower is a party or by which Borrower may be bound
that requires the

 

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subordination in right of payment of any of Borrower’s obligations
subject to this Agreement to any other obligation of Borrower.

 

SECTION 2.8.                       PERMITS,
FRANCHISES.  Borrower possesses, and
will hereafter possess, all permits, consents, approvals, franchises and
licenses required and rights to all trademarks, trade names, patents, and
fictitious names, if any, necessary to enable it to conduct the business in
which it is now engaged in compliance with applicable law.

 

SECTION 2.9.                       ERISA.  Borrower is in compliance in all material
respects with all applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended or recodified from time to time (“ERISA”);
Borrower has not violated any provision of any defined employee pension benefit
plan (as defined in ERISA) maintained or contributed to by Borrower (each, a
“Plan”); no Reportable Event as defined in ERISA has occurred and Is continuing
with respect to any Plan initiated by Borrower; Borrower has met its minimum
funding requirements under ERISA with respect to each Plan; and each Plan will
be able to fulfill its benefit obligations as they come due in accordance with
the Plan documents and under generally accepted accounting principles.

 

SECTION 2.10.                 OTHER OBLIGATIONS.  Borrower is not in default on any obligation for borrowed money,
any purchase money obligation or any other material lease, commitment,
contract, instrument or obligation.

 

SECTION 2.11.                 ENVIRONMENTAL MATTERS.  Except as disclosed by Borrower to Bank in
writing prior to the date hereof, Borrower is in compliance in all material
respects with all applicable federal or state environmental, hazardous waste,
health and safety statutes, and any rules or regulations adopted pursuant
thereto, which govern or affect any of Borrower’s operations and/or properties,
including without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, the Superfund Amendments and
Reauthorization Act of 1986, the Federal Resource Conservation and Recovery Act
of 1976, and the Federal Toxic Substances Control Act, as any of the same may
be amended, modified or supplemented from time to time.  None of the operations of Borrower is the
subject of any federal or state investigation evaluating whether any remedial
action involving a material expenditure is needed to respond to a release of
any toxic or hazardous waste or substance into the environment.  Borrower has no material contingent
liability in connection with any release of any toxic or hazardous waste or
substance into the environment.

 

ARTICLE III

CONDITIONS

 

SECTION 3.1.                       CONDITIONS OF INITIAL
EXTENSION OF CREDIT.  The obligation of
Bank to extend any credit contemplated by this Agreement is subject to the
fulfillment to Bank’s satisfaction of all of the following conditions:

 

(a)                                  Approval
of Bank Counsel.  All legal matters
incidental to the extension of credit by Bank shall be satisfactory to Bank’s
counsel.

 

(b)                                 Documentation.  Bank shall have received, in form and
substance satisfactory to Bank, each of the following, duly executed:

 

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  (i)

  	
   

  	
  This Agreement and each promissory note or other instrument or
  document required hereby.

  
	
  (ii)

  	
   

  	
  Corporate Resolution Borrowing.

  
	
  (iii)

  	
   

  	
  Certificate of Incumbency.

  
	
  (iv)

  	
   

  	
  Continuing Security Agreement Rights to Payment.

  
	
  (v)

  	
   

  	
  Security Agreement Equipment.

  
	
  (vi)

  	
   

  	
  UCC-1 Financing Statement.

  
	
  (vii)

  	
   

  	
  Such other documents as Bank may require under any other Section of
  this Agreement.

  

 

(c)                                  Financial
Condition.  There shall have been no
material adverse change, as determined by Bank, in the financial condition or
business of Borrower, nor any material decline, as determined by Bank, in the
market value of any collateral required hereunder or a substantial or material
portion of the assets of Borrower.

 

(d)                                 Insurance.  Borrower shall have delivered to Bank
evidence of insurance coverage on all Borrower’s property, in form, substance,
amounts, covering risks and issued by companies satisfactory to Bank, and where
required by Bank, with loss payable endorsements in favor of Bank.

 

SECTION 3.2.                       CONDITIONS
OF EACH EXTENSION OF CREDIT.  The
obligation of Bank to make each extension of credit requested by Borrower
hereunder shall be subject to the fulfillment to Bank’s satisfaction of each of
the following conditions:

 

(a)                                  Compliance.  The representations and warranties contained
herein and in each of the other Loan Documents shall be true on and as of the
date of the signing of this Agreement and on the date of each extension of
credit by Bank pursuant hereto, with the same effect as though such
representations and warranties had been made on and as of each such date, and
on each such date, no Event of Default as defined herein, and no condition,
event or act which with the giving of notice or the passage of time or both
would constitute such an Event of Default, shall have occurred and be
continuing or shall exist.

 

(b)                                 Documentation.  Bank shall have received all additional
documents which may be required in connection with such extension of credit.

 

ARTICLE IV

AFFIRMATIVE COVENANTS

 

Borrower covenants that so long as Bank remains committed to extend
credit to Borrower pursuant hereto, or any liabilities (whether direct or
contingent, liquidated or unliquidated) of Borrower to Bank under any of the
Loan Documents remain outstanding, and until payment in full of all obligations
of Borrower subject hereto, Borrower shall, unless Bank otherwise consents in
writing:

 

SECTION 4.1.                       PUNCTUAL
PAYMENTS.  Punctually pay all principal,
interest, fees or other liabilities due under any of the Loan Documents at the
times and place and in the manner specified therein.

 

SECTION 4.2.                       ACCOUNTING
RECORDS.  Maintain adequate books and
records in accordance with generally accepted accounting principles
consistently applied and permit any

 

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representative of Bank, at any reasonable time, to inspect, audit and
examine such books and records, to make copies of the same, and to inspect the
properties of Borrower.

 

SECTION 4.3.                       FINANCIAL
STATEMENTS.  Provide to Bank all of the
following, in form and detail satisfactory to Bank:

 

(a)                                  not
later than 90 days after and as of the end of each fiscal year, an audited
financial statement of Borrower, prepared by an independent certified public
accountant acceptable to Bank, to include balance sheet, income statement,
statement of cash flow and source and application of funds statement;

 

(b)                                 not
later than 45 days after and as of the end of each fiscal quarter, a financial
statement of Borrower, prepared by Borrower, to include balance sheet and
income statement;

 

(c)                                  if
Borrower is a public company, not later than 5 days within filing, copies of
all reports on Form 10-K, 10-Q and 8K filed with Securities and Exchange
Commission;

 

(d)                                 from
time to time such other information as Bank may reasonably request.

 

SECTION 4.4.                       COMPLIANCE.  Preserve and maintain all licenses, permits,
governmental approvals, rights, privileges and franchises necessary for the
conduct of its business; and comply with the provisions of all documents
pursuant to which Borrower is organized and/or which govern Borrower’s
continued existence and with the requirements of all laws, rules, regulations
and orders of any governmental authority applicable to Borrower and/or its business.

 

SECTION 4.5.                       INSURANCE.  Maintain and keep in force insurance of the
types and in amounts customarily carried in lines of business similar to that
of Borrower, including but not limited to fire, extended coverage, public
liability flood, property damage and workers’ compensation, with all such
insurance carried with companies and in amounts satisfactory to Bank, and
deliver to Bank from time to time at Bank’s request schedules setting forth all
insurance then in effect.

 

SECTION 4.6.                       FACILITIES.  Keep all properties useful or necessary to
Borrower’s business in good repair and condition, and from time to time make
necessary repairs, renewals and replacements thereto so that such properties
shall be fully and efficiently preserved and maintained.

 

SECTION 4.7.                       TAXES
AND OTHER LIABILITIES.  Pay and
discharge when due any and all indebtedness, obligations, assessments and
taxes, both real or personal, including without limitation federal and state
income taxes and state and local property taxes and assessments, except such
(a) as Borrower may in good faith contest or as to which a bona fide dispute
may arise and (b) for which Borrower has made provision, to Bank’s
satisfaction, for eventual payment thereof in the event Borrower is obligated
to make such payment.

 

SECTION 4.8.                       LITIGATION.  Promptly give notice in writing to Bank of
any litigation pending or threatened against Borrower with a claim in excess of
$150,000,00.

 

SECTION 4.9.                       FINANCIAL
CONDITION.  Maintain Borrower’s
financial condition as follows using generally accepted accounting principles
consistently applied and used consistently with prior practices (except to the
extent modified by the definitions herein);

 

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(a)                                  Tangible
Net Worth not at any time less than $90,000,000.00, with “Tangible Net Worth”
defined as the aggregate of total stockholders’ equity plus subordinated debt
less any intangible assets.

 

(b)                                 Total
Liabilities divided by Tangible Net Worth not at any time greater than 0.75 to
1.0 with “Total Liabilities” defined as the aggregate of current liabilities
and non-current liabilities less subordinated debt, and with “Tangible Net
Worth” as defined above.

 

(c)                                  Quick
Ratio not at any time less than 2.0 to 1.0 with “Quick Ratio” defined as the
aggregate of: unrestricted cash, unrestricted marketable securities, accounts
receivables and non-billed accounts receivables (recorded in financial
statements) convertible into cash divided by total current liabilities.

 

(d)                                 Net
income after taxes not less than $1.00 on an annual basis, determined as of
each fiscal year end, and pre-tax profit not less than $1.00 on a quarterly
basis, determined as of each fiscal quarter end.

 

SECTION 4.10.                 NOTICE
TO BANK.  Promptly (but in no event more
than five (5) business days after the occurrence of each such event or matter)
give written notice to Bank in reasonable detail of: (a) the occurrence of any
Event of Default or any condition event or act which with the giving of notice
or the passage of time or both would constitute an Event of Default; (b) any
change in the name or the organizational structure of Borrower; (c) the
occurrence and nature of any Reportable Event or Prohibited Transaction, each
as defined in ERISA, or any funding deficiency with respect to any Plan, or any
investigation or audit of the ESOP by the Department of Labor or the Internal
Revenue Service; or (d) any termination or cancellation of any insurance policy
which Borrower is required to maintain, or any uninsured or partially uninsured
loss exceeding $50,000.00 through liability or property damage, or through
fire, theft or any other cause affecting Borrower’s property.  For purposes of this Agreement, “Business
Day” means any day except a Saturday, Sunday or any other day designated as a
holiday under Federal or California statute or regulation.

 

ARTICLE V

NEGATIVE COVENANTS

 

Borrower further covenants that so long as Bank remains committed to
extend credit to Borrower pursuant hereto, or any liabilities (whether direct
or contingent, liquidated or unliquidated) of Borrower to Bank under any of the
Loan Documents remain outstanding, and until payment in full of all obligations
of Borrower subject hereto, Borrower will not without Bank’s prior written
consent:

 

SECTION 5.1.                       USE
OF FUNDS.  Use any of the proceeds of
any credit extended hereunder except for the purposes stated in Article I
hereof.

 

SECTION 5.2.                       OTHER
INDEBTEDNESS.  Create, incur, assume or
permit to exist any indebtedness or liabilities resulting from borrowings,
loans or advances, whether secured or unsecured, matured or unmatured,
liquidated or unliquidated, joint or several, except (a) the liabilities of
Borrower to Bank, and (b) any other liabilities of Borrower existing as of, and
disclosed to Bank prior to, the date hereof, (c) trade payables incurred in the
ordinary course of

 

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business, and (d) other indebtedness or liabilities not to exceed
$100,000.00 in the aggregate outstanding at any time.

 

SECTION 5.3.                       MERGER,
CONSOLIDATION, TRANSFER OF ASSETS. Merge into or consolidate with any other
entity where the  Borrower is not the
surviving entity, or unless such other surviving entity (a) is reasonably
acceptable to Bank, (b) assumes all of Borrower’s liabilities in connection
herewith, and executes any documents, and (c) takes all further actions
reasonably required by Bank to effect such assumption; make any substantial
change in the nature of Borrower’s business as conducted as of the date hereof;
acquire all or substantially all of the assets of any other entity; nor sell,
lease, transfer or otherwise dispose of all or a substantial or material
portion of Borrower’s assets except in the ordinary course of its business.

 

SECTION 5.4.                       GUARANTIES.
Guarantee or become liable in any way as surety, endorser (other than as
endorser of negotiable instruments for deposit or collection in the ordinary
course of business), accommodation endorser or otherwise for, nor pledge or
hypothecate any assets of Borrower as security for, any liabilities or
obligations of any other person or entity, except any of the foregoing in favor
of Bank.

 

SECTION 5.5.                       DIVIDENDS,
DISTRIBUTIONS. Declare or pay any dividend or distribution either in cash,
stock or any other property on Borrower’s stock now or hereafter outstanding,
nor redeem, retire, repurchase or otherwise acquire any shares of any class of
Borrower’s stock now or hereafter outstanding except in connection with
Borrower’s 1994 Restricted Stock Bonus Plan and Agreement.

 

SECTION 5.6.                       PLEDGE
OF ASSETS. Mortgage, pledge, grant or permit to exist a security interest in,
or lien upon, all or any portion of Borrower’s assets pledged to Bank under
this Agreement, except any of the foregoing in favor of Bank or which is
existing as of, and disclosed to Bank in writing prior to, the date hereof.

 

ARTICLE VI

EVENTS OF DEFAULT

 

SECTION 6.1.                       The
occurrence of any of the following shall constitute an “Event of Default” under
this Agreement:

 

(a)                                  Borrower
shall fail to pay when due any principal, interest, fees or other amounts
payable under any of the Loan Documents.

 

(b)                                 Any
financial statement or certificate furnished to Bank in connection with, or any
representation or warranty made by Borrower or any other party under this
Agreement or any other Loan Document shall prove to be incorrect, false or
misleading in any material respect when furnished or made.

 

(c)                                  Any
default in the performance of or compliance with any obligation, agreement or
other provision contained herein or in any other Loan Document (other than
those referred to in subsections (a) and (b) above), and with respect to any
such default which by its nature can be cured, such default shall continue for
a period of thirty (30) days from its occurrence.

 

(d)                                 Any
default in the payment or performance of any obligation, or any defined event
of default, under the terms of any contract or instrument (other than any of
the Loan Documents)

 

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pursuant to which Borrower has incurred any debt or other liability to
any person or entity, where the total of such obligations and/or face amount of
such contracts or instruments exceeds an aggregated of $1,000,000.00.

 

(e)                                  Any
default in the payment or performance of any obligation, or any defined event
of default, under the terms of any contract or instrument (other than any of
the Loan Documents) pursuant to which Borrower has incurred any debt or other
liability to Bank, except where a bonafide dispute exists.

 

(f)                                    The
filing of a notice of judgment lien against Borrower; or the recording of any
abstract of judgment against Borrower in any county in which Borrower has an
interest in real property; or the service of a notice of levy and/or of a writ
of attachment or execution, or other like process, against the assets of
Borrower; or the entry of a judgment against Borrower; in each case when the
total amount involved in any of the foregoing exceeds an aggregate of
$500,000.00.

 

(g)                                 Borrower
shall become insolvent, or shall suffer or consent to or apply for the
appointment of a receiver, trustee, custodian or liquidator of itself or any of
its property, or shall generally fail to pay its debts as they become due, or
shall make a general assignment for the benefit of creditors; Borrower shall
file a voluntary petition in bankruptcy, or seeking reorganization, in order to
effect a plan or other arrangement with creditors or any other relief under the
Bankruptcy Reform Act, Title 11 of the United States Code, as amended or
recodified from time to time (“Bankruptcy Code”), or under any state or Federal
law granting relief to debtors, whether now or hereafter in effect; or any
involuntary petition or proceeding pursuant to the Bankruptcy Code or any other
applicable state or Federal law relating to bankruptcy, reorganization or other
relief for debtors is filed or commenced against Borrower and is not dismissed
within 60 days following date of filing thereof, or Borrower shall file an
answer admitting the jurisdiction of the court and the material allegations of
any involuntary petition; or Borrower shall be adjudicated a bankrupt, or an
order for relief shall be entered against Borrower by any court of competent
jurisdiction under the Bankruptcy Code or any other applicable state or Federal
law relating to bankruptcy, reorganization or other relief for debtors which
such adjudication or order for relief is not reversed, vacated or dismissed
within 60 days following the date of filing thereof.

 

(h)                                 There
shall exist or occur any event or condition which Bank in good faith believes
impairs, or is substantially likely to impair, the prospect of payment or
performance by Borrower of its obligations under any of the Loan Documents.

 

(i)                                     The
dissolution or liquidation of Borrower; or Borrower, or any of its directors, stockholders
or members, shall take action seeking to effect the dissolution or liquidation
of Borrower.

 

(j)                                     Any
change in ownership during the term of this Agreement of an aggregated of
twenty-five percent (25%) or more of the common stock of Borrower other than in
connection with an initial public offering of Borrower’s stock.

 

(k)                                  Any violation of the
Code, ERISA, any regulations thereunder or any laws or regulations applicable
to the ESOP which is deemed by Bank, in the good faith exercise of its discretion,
to have a material adverse effect upon Borrower or ESOP, including , but not
limited to, the occurrence of a prohibited transaction within the meaning
of  Section 4975 (c) of the Code or
Sections 406 or 407 of ERISA.

 

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(I)                                    The
determination by any court or governmental agency or authority that ESOP is not
a qualified plan under Sections 401(a) or (k) of the Code or an ESOP under
Section 4975(e)(7) of the Code or that the Term Loan or any of the related
transactions violate the Code, ERISA or any regulation thereunder, or
constitute a prohibited transaction within the meaning of Section 4975(c) of
the Code or Section 406 or 407 of ERISA.

 

SECTION 6.2.                       REMEDIES.  Upon the occurrence of any Event of Default:
(a) all indebtedness of Borrower under each of the Loan Documents, any term
thereof to the contrary notwithstanding, shall at Bank’s option and without
notice become immediately due and payable without presentment, demand, protest
or notice of dishonor, all of which are hereby expressly waived by each
Borrower; (b) the obligation, if any, of Bank to extend any further credit
under any of the Loan Documents shall immediately cease and terminate; and (c)
Bank shall have all rights, powers and remedies available under each of the
Loan Documents, or accorded by law, including without limitation the right to
resort to any or all security for any credit subject hereto and to exercise any
or all of the rights of a beneficiary or secured party pursuant to applicable
law. All rights, powers and remedies of Bank may be exercised at any time by
Bank and from time to time after the occurrence of an Event of Default, are
cumulative and not exclusive, and shall be in addition to any other rights,
powers or remedies provided by law or equity.

 

ARTICLE VII

MISCELLANEOUS

 

SECTION 7.1.                       NO
WAIVER. No delay, failure or discontinuance of Bank in exercising any right,
power or remedy  under any of the Loan
Documents shall affect or operate as a waiver of such right, power or remedy;
nor shall any single or partial exercise of any such right, power or remedy
preclude, waive or otherwise affect any other or further exercise thereof or
the exercise of any other right, power or remedy. Any waiver, permit, consent
or approval of any kind by Bank of any breach of or default under any of the
Loan Documents must be in writing and shall be effective only to the extent set
forth in such writing.

 

SECTION 7.2.                       NOTICES.
All notices, requests and demands which any party is required or may desire to
give to any other party under any provision of this Agreement must be in
writing delivered to each party at the following address:

 

	
  BORROWER:

  	
   

  	
  FIRST CONSULTING GROUP, INC.

  
	
   

  	
   

  	
  111 W. Ocean Blvd., Suite 400

  
	
   

  	
   

  	
  Long Beach, CA 90802

  
	
   

  	
   

  	
   

  
	
  BANK:

  	
   

  	
  WELLS FARGO BANK, NATIONAL ASSOCIATION

  
	
   

  	
   

  	
  111 W. Ocean Blvd., Suite 300

  
	
   

  	
   

  	
  Long Beach. CA 90802

  

 

or to such other address as any party may designate by written notice
to all other parties. Each such notice, request and demand shall be deemed
given or made as follows: (a) if sent by hand delivery, upon delivery; (b) if
sent by mail, upon the earlier of the date of receipt or three (3) days after
deposit in the U.S. mail, first class and postage prepaid; and (c) if sent by
telecopy, upon receipt.

 

SECTION 7.3.                       COSTS,
EXPENSES AND ATTORNEYS’ FEES. Borrower shall pay to Bank immediately upon
demand the full amount of all payments, advances, charges, costs and

 

10

 

expenses, including reasonable attorneys’ fees (to include outside
counsel fees and all allocated costs of Bank’s in-house counsel), expended or
incurred by Bank in connection with (a) the negotiation and preparation of this
Agreement and the other Loan Documents, Bank’s continued administration hereof
and thereof, and the preparation of any amendments and waivers hereto and
thereto, (b) the enforcement of Bank’s rights and/or the collection of any
amounts which become due to Bank under any of the Loan Documents, and (c) the
prosecution or defense of any action in any way related to any of the Loan
Documents, including without limitation, any action for declaratory relief,
whether incurred at the trial or appellate level, in an arbitration proceeding
or otherwise, and including any of the foregoing incurred in connection with
any bankruptcy proceeding (including without limitation, any adversary
proceeding, contested matter or motion brought by Bank or any other person)
relating to any Borrower or any other person or entity.

 

SECTION 7.4.                       SUCCESSORS,
ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of
the heirs, executors, administrators, legal representatives, successors and
assigns of the parties; provided however, that Borrower may not assign or
transfer its interest hereunder without Bank’s prior written consent. Bank
reserves the right to sell, assign, transfer, negotiate or grant participations
in all or any part of, or any interest in, Bank’s rights and benefits under
each of the Loan Documents. In connection therewith, Bank may disclose all
documents and information which Bank now has or may hereafter acquire relating
to any credit subject hereto, Borrower or its business, or any collateral
required hereunder.

 

SECTION 7.5.                       ENTIRE
AGREEMENT; AMENDMENT. This Agreement and the other Loan Documents constitute
the entire agreement between Borrower and Bank with respect to each credit
subject hereto and supersede all prior negotiations, communications,
discussions and correspondence concerning the subject matter hereof. This
Agreement may be amended or modified only in writing signed by each party
hereto.

 

SECTION 7.6.                       NO
THIRD PARTY BENEFICIARIES. This Agreement is made and entered into for the sole
protection and benefit of the parties hereto and their respective permitted
successors and assigns, and no other person or entity shall be a third party
beneficiary of, or have any direct or indirect cause of action or claim in
connection with, this Agreement or any other of the Loan Documents to which it
is not a party.

 

SECTION 7.7.                       TIME.  Time is of the essence of each and every
provision of this Agreement and each other of the Loan Documents.

 

SECTION 7.8.                       SEVERABILITY
OF PROVISIONS.  If any provision of this
Agreement shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity without invalidating the remainder of such provision or any
remaining provisions of this Agreement.

 

SECTION 7.9.                       COUNTERPARTS.  This Agreement may be executed in any number
of counterparts, each of which when executed and delivered shall be deemed to
be an original, and all of which when taken together shall constitute one and
the same Agreement.

 

SECTION 7.10.                 GOVERNING
LAW.  This Agreement shall be governed
by and construed in accordance with the laws of the State of California.

 

11

 

SECTION 7.11.                 ARBITRATION.

 

(a)                                  Arbitration. The parties hereto agree, upon demand by
any party, to submit to binding arbitration all claims, disputes and controversies
between or among them (and their respective employees, officers, directors,
attorneys, and other agents), whether in tort, contract or otherwise arising
out of or relating to in any way (i) the loan and related Loan Documents which
are the subject of this Agreement and its negotiation, execution,
collateralization, administration, repayment, modification, extension,
substitution, formation, inducement, enforcement, default or termination; or
(ii) requests for additional credit.

 

(b)                                 Governing Rules. Any arbitration proceeding will (i)
proceed in a location in California selected by the American Arbitration
Association (“AAA”); (ii) be governed by the Federal Arbitration Act (Title 9
of the United States Code), notwithstanding any conflicting choice of law
provision in any of the documents between the parties; and (iii) be conducted
by the AAA, or such other administrator as the parties shall mutually agree
upon, in accordance with the AAA’s 
commercial dispute resolution procedures, unless the claim or
counterclaim is at least $1,000,000.00 exclusive of claimed interest,
arbitration fees and costs in which case the arbitration shall be conducted in
accordance with the AAA’s optional procedures for large, complex commercial
disputes (the commercial dispute resolution procedures or the optional
procedures for large, complex commercial disputes to be referred to, as
applicable, as the “Rules”). If there is any inconsistency between the terms
hereof and the Rules, the terms and procedures set forth herein shall control.
Any party who fails or refuses to submit to arbitration following a demand by
any other party shall bear all costs and expenses incurred by such other party
in compelling arbitration of any dispute. Nothing contained herein shall be
deemed to be a waiver by any party that is a bank of the protections afforded
to it under 12 U.S.C. §91 or any similar applicable state law.

 

(c)                                  No Waiver of Provisional Remedies, Self-Help
and Foreclosure. The
arbitration requirement does not limit the right of any party to (i) foreclose
against real or personal property collateral; (ii) exercise self-help remedies
relating to collateral or proceeds of collateral such as setoff or
repossession; or (iii) obtain provisional or ancillary remedies such as replevin,
injunctive relief, attachment or the appointment of a receiver, before during
or after the pendency of any arbitration proceeding. This exclusion does not
constitute a waiver of the right or obligation of any party to submit any
dispute to arbitration or reference hereunder, including those arising from the
exercise of the actions detailed in sections (i), (ii) and (iii) of this
paragraph.

 

(d)                                 Arbitrator Qualifications and Powers. Any arbitration proceeding in which the
amount in controversy is $5,000,000.00 or less will be decided by a single
arbitrator selected according to the Rules, and who shall not render an award
of greater than $5,000,000.00.  Any
dispute in which the amount in controversy exceeds $5,000,000.00 shall be
decided by majority vote of a panel of three arbitrators; provided however,
that all three arbitrators must actively participate in all hearings and
deliberations.  The arbitrator will be a
neutral attorney licensed in the State of California or a neutral retired judge
of the state or federal judiciary of California, in either case with a minimum
of ten years experience in the substantive law applicable to the subject matter
of the dispute to be arbitrated.  The
arbitrator will determine whether or not an issue is arbitratable and will give
effect to the statutes of limitation in determining any claim.  In any arbitration proceeding the arbitrator
will decide (by documents only or with a hearing at the arbitrator’s
discretion) any pre-hearing motions which are similar to motions to dismiss for
failure to state a claim or motions for summary adjudication.  The arbitrator shall resolve all disputes in
accordance with the substantive law of California and may grant any remedy or
relief that a

 

12

 

court of such state could order or grant
within the scope hereof and such ancillary relief as is necessary to make
effective any award.  The arbitrator
shall also have the power to award recovery of all costs and fees, to impose
sanctions and to take such other action as the arbitrator deems necessary to
the same extent a judge could pursuant to the Federal Rules of Civil Procedure,
the California Rules of Civil Procedure or other applicable law. Judgment upon
the award rendered by the arbitrator may be entered in any court having
jurisdiction.  The institution and
maintenance of an action for judicial relief or pursuit of a provisional or
ancillary remedy shall not constitute a waiver of the right of any party,
including the plaintiff, to submit the controversy or claim to arbitration if
any other party contests such action for judicial relief.

 

(e)                                  Discovery.  In any arbitration proceeding
discovery will be permitted in accordance with the Rules. All discovery shall
be expressly limited to matters directly relevant to the dispute being
arbitrated and must be completed no later than 20 days before the hearing date
and within 180 days of the filing of the dispute with the AAA.  Any requests for an extension of the
discovery periods, or any discovery disputes, will be subject to final
determination by the arbitrator upon a showing that the request for discovery
is essential for the party’s presentation and that no alternative means for
obtaining information is available.

 

(f)                                    Class Proceedings and Consolidations. 
The resolution of any dispute arising pursuant to the terms of this
Agreement shall be determined by a separate arbitration proceeding and such
dispute shall not be consolidated with other disputes or included in any class
proceeding.

 

(g)                                 Payment Of Arbitration Costs And Fees. 
The arbitrator shall award all costs and expenses of the arbitration
proceeding.

 

(h)                                 Real Property Collateral; Judicial Reference. 
Notwithstanding anything herein to the contrary, no dispute shall be
submitted to arbitration if the dispute concerns indebtedness secured directly
or indirectly, in whole or in part, by any real property unless (i) the holder
of the mortgage, lien or security interest specifically elects in writing to
proceed with the arbitration, or (ii) all parties to the arbitration waive any
rights or benefits that might accrue to them by virtue of the single action
rule statute of California, thereby agreeing that all indebtedness and
obligations of the parties, and all mortgages, liens and security interests
securing such indebtedness and obligations, shall remain fully valid and
enforceable.  If any such dispute is not
submitted to arbitration, the dispute shall be referred to a referee in
accordance with California Code of Civil Procedure Section 638 et seq., and
this general reference agreement is intended to be specifically enforceable in
accordance with said Section 638.  A
referee with the qualifications required herein for arbitrators shall be
selected pursuant to the AAA’s selection procedures.  Judgment upon the decision rendered by a referee shall be entered
in the court in which such proceeding was commenced in accordance with
California Code of Civil Procedure Sections 644 and 645.

 

(i)                                     Miscellaneous.  To
the maximum extent practicable, the AAA, the arbitrators and the parties shall
take all action required to conclude any arbitration proceeding within 180 days
of the filing of the dispute with the AAA. 
No arbitrator or other party to an arbitration proceeding may disclose
the existence, content or results thereof, except for disclosures of
Information by a party required in the ordinary course of its business or by
applicable law or regulation.  If more
than one agreement for arbitration by or between the parties potentially
applies to a dispute, the arbitration provision most directly related to the
Loan Documents or the subject matter of the dispute shall control.  This arbitration provision shall survive
termination, amendment or expiration of any of the Loan Documents or any
relationship between the parties.

 

13

 

IN WITNESS
WHEREOF, the parties hereto have caused this Agreement to be executed as of the
day and year first written above.

 

 

	
   

  	
  WELLS FARGO BANK,

  
	
  FIRST CONSULTING GROUP, INC.

  	
   NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Luther J. Nussbaum

  	
   

  	
  By:

  	
  /s/ Elizabeth Renteria

  	
   

  
	
   

  	
  Luther J. Nussbaum

  	
   

  	
  Elizabeth Renteria

  
	
   

  	
  Chief Executive
  Officer/Chairman

  	
   

  	
  Vice President

  
						

 

14

 

	
  WELLS FARGO

  	
  REVOLVING LINE OF CREDIT NOTE

  
	
   

  	
   

  
	
  $7,000,000.00

  	
  INITIAL

  	
  Long Beach,
  California

  
	
   

  	
  May 1, 2003

  
			

 

FOR VALUE RECEIVED, the
undersigned First Consulting Group, Inc. (“Borrower”)
promises to pay to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”)
at its office at South Bay RCBO, 111 West
Ocean Blvd., Suite #300, Long Beach, CA 90802, or at such other
place as the holder hereof may designate, in lawful money of the United States
of America and in immediately available funds, the principal sum of $7,000,000.00, or so much thereof as may be
advanced and be outstanding, with interest thereon, to be computed on each
advance from the date of its disbursement as set forth herein.

 

1.                                       INTEREST:

 

1.1                                 Interest.  The outstanding principal
balance of this Note shall bear interest (computed on the basis of a 360-day
year, actual days elapsed) at a rate per annum equal to the Prime Rate in effect from time to time.  The “Prime Rate” is a base rate that Bank
from time to time establishes and which serves as the basis upon which
effective rates of interest are calculated for those loans making reference
thereto.  Each change in the rate of
interest hereunder shall become effective on the date each Prime Rate change is
announced within Bank.

 

1.2                               Payment of Interest. 
Interest accrued on this Note shall be payable on the 1st day of each month, commencing June 1,
2003.

 

1.3                                 Default Interest. 
From and after the maturity date of this Note, or such earlier date as
all principal owing hereunder becomes due and payable by acceleration or
otherwise, the outstanding principal balance of this Note shall bear interest
until paid in full at an increased rate per annum (computed on the basis of a
360-day year, actual days elapsed) equal to 4% above the rate of interest from
time to time applicable to this Note.

 

2.                                       BORROWING AND REPAYMENT:

 

2.1                                 Borrowing and Repayment. 
Borrower may from time to time during the term of this Note borrow,
partially or wholly repay its outstanding borrowings, and reborrow, subject to
all of the limitations, terms and conditions of this Note and of the Credit
Agreement between Borrower and Bank defined below; provided however, that the
total outstanding borrowings under this Note shall not at any time exceed the
principal amount stated above.  The
unpaid principal balance of this obligation at any time shall be the total
amounts advanced hereunder by the holder hereof less the amount of principal
payments made hereon by or for any Borrower, which balance may be endorsed
hereon from time to time by the holder. 
The outstanding principal balance of this Note shall be due and payable
in full on May 3, 2004.

 

2.2                                 Advances.  Advances hereunder, to the
total amount of the principal sum available hereunder, may be made by the
holder at the oral or written request of (a) Luther
J. Nussbaum, Michael J. Puntoriero or Philip H. Ockelmann, any one
acting alone, who are authorized to request advances and direct the disposition
of any advances until written notice of the revocation of such authority is
received by the holder at the office designated above, or (b) any person, with
respect to advances deposited to the credit of any deposit account of any
Borrower, which advances, when so deposited, shall be conclusively presumed to
have been made to or for the benefit of each Borrower regardless of the fact
that persons other than those authorized to request advances may have authority
to draw against such account.  The
holder shall have no obligation to determine whether any person requesting an
advance is or has been authorized by any Borrower.

 

2.3                                 Application of Payments. 
Each payment made on this Note shall be credited first, to any interest
then due and second, to the outstanding principal balance hereof.

 

PROMNOTE.CA
(01/03)

Revolving Line of Credit Note

02699,
#2475800509

 

1

 

3.                                       EVENTS
OF DEFAULT:

 

This Note is made pursuant to and is subject to the terms and
conditions of that certain Credit Agreement between Borrower and Bank dated as
of May 1, 2003, as amended from
time to time (the “Credit Agreement”). 
Any default in the payment or performance of any obligation under this
Note, or any defined event of default under the Credit Agreement, shall
constitute an “Event of Default” under this Note.

 

4.                                       MISCELLANEOUS:

 

4.1                                 Remedies.                                          Upon
the occurrence of any Event of Default, the holder of this Note, at the
holder’s option, may declare all sums of principal and interest outstanding
hereunder to be immediately due and payable without presentment, demand, notice
of nonperformance, notice of protest, protest or notice of dishonor, all of
which are expressly waived by each Borrower, and the obligation, if any, of the
holder to extend any further credit hereunder shall immediately cease and
terminate.  Each Borrower shall pay to
the holder immediately upon demand the full amount of all payments, advances,
charges, costs and expenses, including reasonable attorneys’ fees (to include
outside counsel fees and all allocated costs of the holder’s in-house counsel),
expended or incurred by the holder in connection with the enforcement of the
holder’s rights and/or the collection of any amounts which become due to the
holder under this Note, and the prosecution or defense of any action in any way
related to this Note, including without limitation, any action for declaratory
relief, whether incurred at the trial or appellate level, in an arbitration
proceeding or otherwise, and including any of the foregoing incurred in
connection with any bankruptcy proceeding (including without limitation, any
adversary proceeding, contested matter or motion brought by Bank or any other
person) relating to any Borrower or any other person or entity.

 

4.2                                 Obligations
Joint and Several.                                 Should
more than one person or entity sign this Note as a Borrower, the obligations of
each such Borrower shall be joint and several.

 

4.3                                 Governing
Law.            This Note shall be
governed by and construed in accordance with the laws of the State of
California.

 

IN WITNESS WHEREOF, the undersigned has executed this Note as of the
date first written above.

 

First Consulting Group, Inc.

 

	
  By:

  	
    /s/ Luther J. Nussbaum

  	
   

  	
   

  
	
   

  	
  Luther J.
  Nussbaum, Chief Executive

  	
   

  	
   

  
	
   

  	
  Officer/Chairman

  	
   

  	
   

  

 

2

 

	
  WELLS FARGO

  	
  CERTIFICATE OF
  INCUMBENCY

  

 

TO:  WELLS FARGO BANK, NATIONAL
ASSOCIATION

 

The undersigned, Michael A. Zuercher,
Secretary of First Consulting Group, Inc., a
corporation created and existing under the laws of the state of California, hereby certifies to Wells Fargo
Bank, National Association (“Bank”) that (a) the following named persons are
duly elected officers of this corporation and presently hold the titles
specified below, (b) said officers are authorized to act on behalf of this
Corporation in transactions with Bank, and (c) the signature opposite each
officer’s name is his or her true signature:

 

	
  TITLE

  	
   

  	
  NAME

  	
   

  	
  SIGNATURE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Chief Executive Officer/Chairman

  	
   

  	
  Luther J. Nussbaum

  	
   

  	
  /s/ Luther J. Nussbaum

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Executive Vice President/CFO

  	
   

  	
  Michael J. Puntoriero

  	
   

  	
  /s/ Michael J. Puntoriero

  

 

The undersigned further certifies that if any of the above-named
officers change, or if, at any time, any of said officers are no longer
authorized to act on behalf of this corporation in transactions with Bank, this
corporation shall immediately provide to Bank a new Certificate of Incumbency.  Bank is hereby authorized to rely on this
Certificate of Incumbency until a new Certificate of Incumbency certified by
the Secretary of this corporation is received by Bank.

 

IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the corporate
seal of said corporation as of May 1, 2003.

 

	
   

  	
  /s/ Michael A. Zuercher

  
	
   

  	
   

  	
  Secretary

  
	
  (SEAL)

  	
   

  	
   

  

 

1Exhibit
10.21

 

Codigent Solutions Group, Inc.

 

1209 Laurel Street

 

Triple Net Lease

 

1

 

EXHIBIT
A1

BASIC LEASE INFORMATION

 

	
  Lease Date:

  	
  April 10, 2002

  
	
  Landlord:

  	
  Nashville Urban
  Partners 2000 II, LLC

  
	
  Address:

  	
  124 12th Avenue
  South, Suite 610, Nashville, TN  37203

  
	
   

  	
   

  
	
  Tenant:

  	
  Codigent
  Solutions Group, Inc.

  
	
  Address:

  	
  113 Seaboard
  Lane, Suite A-170

  
	
   

  	
  Franklin,
  TN  37067

  
	
   

  	
   

  
	
  Contact:

  	
  Tim Unger, Chief
  Executive Officer

  
	
  Telephone:

  	
  615-507-8041

  
	
   

  	
   

  
	
  Building:

  	
  1209 Laurel
  Street, Nashville, Tennessee

  
	
   

  	
   

  
	
  Tenant
  Improvements: 

  	
  Tenant shall
  accept the space “as is”

  
	
   

  	
   

  
	
  Witnesseth:

  	
  Rentable Square
  Feet:  18,000

  
	
   

  	
   

  
	
  Paragraph 2(a):

  	
  LEASE TERM:

  	
  Five  (5) years or 60 months

  
	
   

  	
  COMMENCING ON:

  	
  April 15, 2002

  
	
   

  	
  EXPIRATION DATE:

  	
  April 14, 2007
  (unless modified as permitted herein)

  
	
   

  	
  EXTENSION RIGHT:

  	
  One 5-year
  renewal at the rental rate described below

  
	
   

  	
   

  	
   

  
	
  Paragraph 3(a):

  	
  (Annual) Rent per Rentable Square Foot

  

 

	
  Year(s)

  	
   

  	
  Rate/RSF*

  	
   

  	
  Monthly
  Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  $

  	
  14.00

  	
   

  	
  $

  	
  21,000.00

  	
   

  
	
  2

  	
   

  	
  $

  	
  16.00

  	
   

  	
  $

  	
  24,000.00

  	
   

  
	
  3

  	
   

  	
  $

  	
  17.00

  	
   

  	
  $

  	
  25,500.00

  	
   

  
	
  4

  	
   

  	
  $

  	
  19.25

  	
   

  	
  $

  	
  28,875.00

  	
   

  
	
  5

  	
   

  	
  $

  	
  20.25

  	
   

  	
  $

  	
  30,375.00

  	
   

  

 

* This is a Triple Net Lease and Tenant shall pay all
utilities; janitorial costs; general and equipment maintenance expenses, taxes,
property expenses, insurance, and other costs, all as more specifically
described herein.

 

	
  Paragraph 2(b):

  	
  Five Year
  Renewal Term

  	
   

  

 

(Annual) Rent per Rentable Square Foot shall be the
greater of the rates set forth below or the market rate at such time but in no
event shall such rate exceed $25.00/RSF

 

	
  Year(s)

  	
   

  	
  Rate/RSF*

  	
   

  	
  Monthly
  Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6

  	
   

  	
  $

  	
  21.00

  	
   

  	
  $

  	
  31,500.00

  	
   

  
	
  7

  	
   

  	
  $

  	
  21.00

  	
   

  	
  $

  	
  31,500.00

  	
   

  
	
  8

  	
   

  	
  $

  	
  22.00

  	
   

  	
  $

  	
  33,000.00

  	
   

  
	
  9

  	
   

  	
  $

  	
  22.50

  	
   

  	
  $

  	
  33,750.00

  	
   

  
	
  10

  	
   

  	
  $

  	
  23.00

  	
   

  	
  $

  	
  34,500.00

  	
   

  

 

2

 

* This is a Triple Net Lease and Tenant shall pay all
utilities; janitorial costs; general and equipment maintenance expenses, taxes,
property expenses, insurance, and other costs, all as more specifically
described herein.

 

 

	
  Paragraph 3(c):

  	
  Security
  Deposit:  $25,000

  	
   

  

 

 

The foregoing
Basic Lease information is hereby incorporated into and made a part of this
Lease.  Each reference in this Lease to
any of the Basic Lease Information shall mean the respective information herein
above set forth and shall be construed to incorporate all of the terms provided
under the particular Lease paragraph pertaining to such information.  In the event of any conflict between any
Basic Lease Information and the Lease, the latter shall control.

 

	
  Landlord:

  	
  Tenant:

  
	
   

  	
   

  
	
  Nashville Urban Partners 2000 II,
  LLC

  	
  Codigent Solutions Group, Inc.

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
									

 

3

 

TABLE OF
CONTENTS

 

	
  1.

  	
  Occupancy
  and Use.

  	
   

  
	
  2.

  	
  Term
  and Possession.

  	
   

  
	
  3.

  	
  Rent

  	
   

  
	
  4.

  	
  Insurance
  and Taxes

  	
   

  
	
  5.

  	
  Utilities

  	
   

  
	
  6.

  	
  Restrictions
  on Use.

  	
   

  
	
  7.

  	
  Compliance
  With Laws.

  	
   

  
	
  8.

  	
  Alterations.

  	
   

  
	
  9.

  	
  Repairs and Other Services

  	
   

  
	
  10.

  	
  Liens.

  	
   

  
	
  11.

  	
  Assignment and Subletting

  	
   

  
	
  12.

  	
  Insurance and
  Indemnification

  	
   

  
	
  13.

  	
  Waiver of Subrogation.

  	
   

  
	
  14.

  	
  Services and Utilities.

  	
   

  
	
  15.

  	
  Tenant’s Certificates.

  	
   

  
	
  16.

  	
  Holding Over.

  	
   

  
	
  17.

  	
  Subordination.

  	
   

  
	
  18.

  	
  Rules and Regulations.

  	
   

  
	
  19.

  	
  Re-Entry By Landlord.

  	
   

  
	
  20.

  	
  Insolvency or Bankruptcy.

  	
   

  
	
  21.

  	
  Tenant Default.

  	
   

  
	
  22.

  	
  Landlord Default.

  	
   

  
	
  23.

  	
  Damage By Fire or Other
  Casualty

  	
   

  
	
  24.

  	
  Eminent Domain.

  	
   

  
	
  25.

  	
  Sale By Landlord.

  	
   

  
	
  26.

  	
  Right of Landlord to
  Perform.

  	
   

  
	
  27.

  	
  Surrender of Premises.

  	
   

  
	
  28.

  	
  Waiver.

  	
   

  
	
  29.

  	
  Notices

  	
   

  
	
  30.

  	
  Abandonment.

  	
   

  
	
  31.

  	
  Successors and Assigns.

  	
   

  
	
  32.

  	
  Attorney’s Fees.

  	
   

  
	
  33.

  	
  Miscellaneous.

  	
   

  
	
  34.

  	
  Parallel Gear

  	
   

  
	
  35.

  	
  Limitation of
  Landlord’s Liability.

  	
   

  
	
  36.

  	
  Limitation of
  Trustee’s Liability.

  	
   

  
	
  37.

  	
  Tenant Improvements.

  	
   

  
	
  38.

  	
  Special Stipulations.

  	
   

  
	
  39.

  	
  Brokerage.

  	
   

  
	
  40.

  	
  Force Majeure.

  	
   

  

 

	
   

  	
  Exhibit A:

  	
  Floorplan of the Building

  
	
   

  	
  Exhibit A1:

  	
  Basic Lease Information

  
	
   

  	
  Exhibit B:

  	
  Rules and Regulations

  
	
   

  	
  Exhibit C:

  	
  Security Fence

  

 

4

 

LEASE AGREEMENT

 

THIS LEASE AGREEMENT is made and entered into as of
April 10, 2002, by and between Nashville Urban Partners 2000 II, LLC
(herein called “Landlord”), and Codigent Solutions Group, Inc. (herein
called “Tenant”);

 

WITNESSETH:

 

Tenant desires to lease those premises (the
“Premises”) consisting of all of the land, parking areas and the building
located at 1209 Laurel Street, Nashville, Tennessee (the “Building”).  The fee simple owner of the Premises is C.
Mark Carver, Trustee (the “Trustee”) pursuant to that certain Amended and
Restated Trust Agreement dated September 29, 2000 (the “Trust Agreement”).  Landlord is the sole beneficiary under the
Trust Agreement as it applies to the Premises. 
As such beneficial owner of the Premises, Landlord is the landlord under
this Lease.

 

Upon and subject to the terms, covenants and
conditions hereinafter set forth, Landlord hereby leases to Tenant and Tenant
hereby leases from Landlord the Premises.

 

1.             Occupancy
and Use.

 

Tenant shall use and occupy the premises for purposes
of general office use and operating its business providing e-business services
and information technology services, and for no other use or purpose without
the prior written consent of Landlord. 
Landlord shall have the right to use (a) Storage Area A as shown on
Exhibit A hereto for storage until July 1, 2002 and (b) Storage Area B as shown
on Exhibit A hereto for storage until May 6, 2002.  Prior to May 6, 2002, Landlord shall use reasonable efforts to
consolidate all of its materials in Storage Area B on one side of Storage Area
B.  Prior to entering such storage
areas, shall provide Tenant with reasonable notice.  Landlord and Tenant agree and acknowledge that Landlord may, at
any time during the Term of the Lease after providing Tenant with at least 30
days prior written notice, remove from the Building the portions of the
Building shown on Exhibit A as Storage Area A and Office Area A.  Until such time that Landlord commences such
removal (and subject to the right of Landlord to use Storage Areas A and B as
described above), Tenant shall have the right to use and occupy Storage Area A
and Office Area A.  In the course of
removing such portions of the Building, 
Landlord shall use its best efforts in good faith to avoid any material
interference with Tenant’s business operations, including, without limitation,
interruption of utility services. 
Landlord shall be liable (to the extent such liability is not covered by
insurance) with respect to interference with Tenant’s business for which
Landlord’s action is the direct, material and proximate cause of Tenant’s
inability to provide substantial and customary service to its customers.

 

2.             Term
and Possession.

 

(a)           The
term of this Lease (the “Term”) shall be for a period of sixty (60) months as
specified in the Basic Lease Information or until sooner terminated or extended
as herein provided.  The Commencement
Date shall be April 15, 2002.  Upon
reasonable prior request to Landlord, Tenant shall have reasonable rights to
enter the Building prior to the Commencement Date to prepare the space and move
in equipment and furniture but Tenant shall not commence its business operations
in the Building prior to the Commencement Date.

 

5

 

(b)           Landlord
hereby grants to Tenant the option to renew the Lease for an additional term
commencing April 15, 2007 and ending on April 14, 2012 unless sooner terminated
as herein provided.  To exercise such
renewal option, Tenant must provide Landlord with written notice on or before
one hundred eighty (180) days prior to the expiration of the initial term of this
Lease.  Rent for the extension term shall
be at the greater of (i) the prevailing market rate for the central business
district in Nashville, Tennessee, at such time for comparable space or (ii) the
rates set forth in the Basic Lease Information set forth herein but in no event
shall the Rent per square foot during the five-year additional term exceed
$25.00 per rentable square foot.  Tenant
and Landlord shall, on or before 90 days prior to the expiration of the initial
term of the Lease, agree upon the rental rate after using their best efforts in
good faith.  In the event that the
parties cannot agree prior to such time, then the renewal of the Term shall be
void and the Lease shall terminate on April 14, 2007.

 

(c)           Notwithstanding
the foregoing Section 2(b), during the second five years of the Term of the
Lease, Landlord shall have the right to move Tenant to another “comparable
location” at Landlord’s sole cost and expense. 
The comparable location shall be equal to or superior to the quality of
the Building (including, without limitation, the specifications, build out
whether done by Landlord or Tenant in the Building, parking and security).  The move shall not result in an interruption
of Tenant’s business.  In the event that
Landlord desires to exercise such option to move Tenant, Landlord shall provide
Tenant with at least one hundred eighty (180) days prior written notice.

 

3.             Rent

 

(a)           Tenant
shall pay to Landlord throughout the Term the annual rental amount specified in
the Basic Lease Information (“Rent”), which sum shall be payable by Tenant in
equal monthly installments on or before the first day of each month, in
advance, in lawful money of the United States, without any prior demand
therefore and without deduction or offset whatsoever, to Landlord at the
address specified in the Basic Lease Information or to such other firm or to
such other place as Landlord may from time to time designate in writing.  Tenant shall pay to Landlord all charges and
other amounts whatsoever as and when provided in the Lease (the “Additional
Charges”).  All Additional Charges will
be payable to Landlord at the place where the Rent is payable and Landlord
shall have the same remedies for a default in payment of Additional Charges as
for a default in the payment of Rent. 
If the Commencement Date should occur on a day other than the first day
of a calendar month, or if the Expiration Date should occur on a day other than
the last day of a calendar month, then the Rent and Additional Charges for such
fractional month shall be prorated on a daily basis.

 

(b)           Tenant
recognizes that late payment of any Rent or Additional Charges will result in
administrative expense to Landlord, the extent of which additional expense is
extremely difficult and economically impractical to ascertain.  Tenant therefore agrees that if any Rent or
Additional Charges remain unpaid for more than five (5) days after the amount
is due, the amount of such unpaid Rent or Additional Charges shall be increased
by a late charge to be paid to Landlord by Tenant in an amount equal to ten
percent (10%) of the amount of the delinquent Rent or Additional Charges
calculated from the date originally due. 
The amount of the late charge to be paid to Landlord by Tenant on any
unpaid Rent or Additional Charges shall be added to Tenant’s obligation for the
monthly period on which the late charge is unpaid, all of which shall be due
and payable on demand.  The provisions
of this Paragraph 3(b) in no way relieve Tenant of the obligation to pay rent
or additional charges on or before the date on which they are due, nor do the
terms of Paragraph 3(b)

 

6

 

in any way affect
Landlord’s remedies pursuant to Paragraph 21 in the event any Rent or
Additional Charge is unpaid after the date due.

 

(c)           Landlord
acknowledges that Tenant has deposited with Landlord the Security Deposit in
the amount of $25,000.00.  Landlord
shall hold the Security Deposit for the full and faithful performance by Tenant
of all terms, covenants, and conditions of this Lease to be performed on the
part of Tenant, which sum shall be returned to Tenant after the expiration or
termination of this Lease within ten (10) business days after termination
provided Tenant has fully and faithfully carried out all of the terms,
covenants, and conditions to be performed by Tenant under this Lease.  Tenant shall not mortgage, assign, or
encumber the Security Deposit without the prior written consent of
Landlord.  In the event of a bona fide
sale of the Building subject to this Lease, Landlord (and any future landlord)
shall have the right to transfer the Security Deposit to such purchaser only
for the benefit of Tenant, whereupon Landlord shall be released by Tenant from
all liability for the return of the Security Deposit and Tenant agrees to look
solely to the purchaser for the return of the Security Deposit.

 

4.             Insurance
and Taxes

 

Tenant is responsible for payment of the
following,  which shall be paid directly
by Tenant to the provider of such services;

 

(1)           INSURANCE,
including, but not limited to, (i) fire and extended coverage premium, (ii)
earthquake and extended coverage premium, (iii) liability and extended coverage
premium, and (iv) premiums for other insurance customarily carried from time to
time by landlords in the general area of the Building;

 

(2)           TAXES,
including, but not limited to, (i) real estate taxes and assessments on the
Land, the Building or the Premises, and taxes and assessments levied in
substitution or supplementation in whole or in part of such taxes, (ii)
personal property taxes (for the Building’s personal property, including
license expenses), (iii) taxes imposed on services of Landlord’s agents and
employees, and (iv) all other taxes or fees now or hereafter levied by any
governmental authority on the Building, the Land or its contents or on the
operation and use thereof.

 

5.             Utilities

 

Tenant will at its own cost and expense pay for all
water, sanitary sewer, gas, electricity, and other utilities used in the
Premises and will save and hold Landlord harmless from any charge or liability
for same.  Such payments shall be made
directly to the supplier of any utility to whom Landlord may direct Tenant to
pay.

 

6.             Restrictions
on Use.

 

Tenant shall not use or allow the Premises to be used
for any improper, immoral, unlawful or objectionable purpose, nor shall Tenant
cause or maintain or permit any nuisance in on or about the Premises.  Tenant shall not commit or suffer the
commission of any waste in, on or about the Premises.

 

7

 

7.             Compliance
With Laws.

 

Tenant shall not use the Premises, and or the
Building, or permit anything to be done in or about the Premises, and or the
Building, which will in any way conflict with the law, statute, ordinance or
governmental rule or regulation now in force or which may hereafter be enacted
or promulgated.  Tenant  shall not do or permit anything to be done
on or about the Premises, and or the Building, or bring or keep anything
therein which will in any way increase the rate of any insurance upon the Building
or any of its contents or cause a cancellation of such insurance upon the
Building or any of its contents or otherwise affect such insurance in any
manner, and Tenant shall at its sole cost and expense promptly comply with all
laws, statutes, ordinances and governmental rules, regulations or requirements
now in force or which may hereafter be in force and with the requirements of
any board of fire underwriters or other similar body now or hereafter
constituted relating to or affecting the condition, use or occupancy of the
Premises, and or the Building, excluding structural changes not related to or
affected by alterations or improvements made by or for Tenant or Tenant’s
acts.  The judgment or opinion of any administrative
body or court of competent jurisdiction or the admission of Tenant in an action
against Tenant, whether Landlord be a party thereto or not, that Tenant has so
violated any such law, statute, ordinance, rule, regulation, or requirement,
shall be conclusive of such violation as between Landlord and Tenant.

 

8.             Alterations.

 

(a)           Tenant
shall not make or suffer to be made any alterations, additions or improvements
(collectively, “Alterations”) in, on or to the Premises or any part
thereof  without the prior written
consent of Landlord, which consent shall not be unreasonably withheld (except
if any Alteration(s) would affect the structural integrity or architectural
appearance of the Premises.) Any Alterations in, on or to the Premises, except
for Tenant’s movable furniture and equipment (whether or not attached to the
Premises) shall immediately become Landlord’s property and at the end of the
Term, shall remain on the Premises without compensation to Tenant.  In the event Landlord consents to the making
of any Alterations by Tenant, the same shall be made by Tenant, at Tenant’s
sole cost and expense, in accordance with plans and specifications approved by
Landlord, and any contractor or person selected by Tenant to make the same must
be first approved in writing by Landlord. 
Tenant shall give to Landlord at least five (5) business days prior
notice of commencement of any construction on the Premises.  Tenant agrees and acknowledges that Tenant
is not the agent for Landlord for any purpose, including, without limitation,
contracting with third parties for improvements to the Premises.   Tenant agrees that any construction
contract related to the Premises executed by Tenant shall contain a provision
stating that Tenant is not the agent for Landlord for any purpose, including,
without limitation, contracting with third parties for improvements to the
Premises.  Tenant agrees that any party
providing construction services or materials to the Premises shall execute a
waiver of such party’s right to file a mechanic’s lien against the Landlord’s interest
in the Premises and Tenant shall deliver such waiver to Landlord prior to
permitting such party to begin work on the Premises.

 

(b)           As
soon as reasonably possible after execution of this Lease, Landlord agrees to
erect a security fence to enclose and secure the area containing the generator
as more particularly described on Exhibit C attached hereto and
incorporated herein by reference.  Such
security fence shall be comparable to the existing security fencing at the
Premises.

 

(c)           During
the Term, Tenant shall have the option to install, at Tenant’s expense, an
additional back-up generator to the Premises without Landlord’s consent.

 

8

 

9.             Repairs
and Other Services

 

(a)           Tenant
shall take good care of the Premises and, at Tenant’s cost and expense, shall
make all repairs and replacements as and when Landlord deems necessary to
preserve the Premises in good working order and condition, except that Tenant
shall not be required to make any structural repairs or structural replacements
unless necessitated or occasioned by the acts, omissions or negligence of
Tenant or any person claiming through or under Tenant, or any of their
servants, employees, contractors, agents, visitors, or licensees, or by the use
or occupancy or manner of use or occupancy of the Premises by Tenant or any
such person.  Notwithstanding the
foregoing, Landlord shall repair and maintain the structure (except as provided
above), locks, doors, roof, structural walls, windows, roof-mounted HVAC
systems, and plumbing system.  Landlord
shall also provide groundskeeping services, maintain any landscaping, and
provide a security patrol from 
approximately 6-9 p.m each evening. 
Landlord shall not be liable for and, except as provided in Paragraph
22, there shall be no abatement of Rent with respect to, any injury or
interference with Tenant’s business arising from any repairs, maintenance,
alteration or improvement in or to any portion of the Building, including the
Premises, or in or to the fixtures, appurtenances and equipment therein except
that Tenant shall be entitled to a rental abatement for any portion of the
Premises which becomes substantially unusable during such repair, maintenance,
alterations or improvements. 
Notwithstanding the foregoing sentence, Landlord shall be liable (to the
extent such liability is not covered by insurance) with respect to interference
with Tenant’s business for which Landlord’s action is the direct, material and
proximate cause of Tenant’s inability to provide substantial and customary
service to its customers.

 

(b)           All
repairs and replacements required to be made by Tenant or any person claiming
through or under Tenant shall be made and performed (a) at Tenant’s cost and
expense and at such time and in such manner as Landlord may reasonably
designate, (b) by contractors or mechanics approved by Landlord in its
reasonable discretion, (c) so that same shall be at least equal in quality,
value, and utility to the original work or installation, and (d) in accordance
with the Rules and Regulations for the Building reasonably adopted by Landlord
from time to time and in accordance with all applicable laws and regulations of
governmental authorities having jurisdiction over the Premises.

 

10.          Liens.

 

Tenant shall keep the Premises free from any liens
arising out of any work performed, material furnished or obligations incurred
by Tenant.  In the event that Tenant
does not, within forty-five (45) days following the imposition of any such
lien, cause the same to be released of record by payment or posting of a proper
bond and providing Landlord with notarized lien waivers, Landlord shall have,
in addition to all other remedies provided herein and by law, the right, but
not the obligation, to cause the same to be released by such means as it shall
deem proper, including payment of the claim giving rise to such lien.  All such sums paid by Landlord and all
reasonable expenses incurred by it in connection therewith shall be considered
Additional Charges and shall be payable to it by Tenant on demand with interest
at the maximum rate permitted by law; such sums not paid by Tenant as billed
shall constitute a default under the terms provided herein.  Landlord shall have the right at all times
to post and keep posted on the Premises any notices permitted or required by
law, or which Landlord shall deem proper, for the protection of Landlord, the
Premises, the Building and any other party having an interest therein.

 

9

 

11.          Assignment
and Subletting

 

(a)           Except
as set forth below Tenant shall not directly or indirectly, voluntarily or by
operation of law, sell, assign, encumber, pledge or otherwise transfer or
hypothecate all or any portion of its interest or rights with respect to the
Premises or Tenant’s leasehold estate hereunder (collectively, “Assignment”),
or permit all or any portion of the Premises to be occupied by anyone other
than Tenant or sublet all or any portion of the Premises or transfer a portion
of its interest in or rights with respect to Tenant’s Leasehold estate
hereunder (collectively, “Sublease”) or any portion thereof without Landlord’s
prior written consent in each instance, which consent may not be unreasonably
withheld, conditioned, or delayed. Notwithstanding anything contained herein to
the contrary, Tenant may, without obtaining the consent of Landlord, assign,
sublet or transfer this Lease or any interest therein, to any Affiliate, as
hereinafter defined, of Tenant; provided, however, that in the event of such
assignment, subletting, or transfer, Tenant shall remain liable for its
obligations under this Lease.  Tenant
shall provide a notice of any such assignment. 
An “Affiliate” shall mean any corporation which, directly or indirectly,
controls or is controlled by, or is under common control with, Tenant.  For this purpose, “control” shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction or the management and policies of such corporation, whether through
the ownership of voting securities, or by contract or otherwise.  Additionally, for purposes of this Lease,
the following transactions relating to Tenant shall not be considered an
Assignment of this Lease and shall not give rise to any requirement of approval
or consent by any party to this Lease, nor, result in any right to terminate or
alter this Lease; any merger (including, without limitation, a reincorporation
merger), consolidation, reorganization, stock exchange, sale of stock or
substantially all of the assets or other similar or related transaction in
which Tenant is the surviving entity or, if Tenant is not the surviving entity,
the surviving entity continues to conduct the business conducted by Tenant
prior to consummation of the transaction; and the resulting company shall have
financial worth equal to or greater than Tenant.

 

(b)           Except
in the case of transactions not considered Assignments as provided above, if
Tenant desires at anytime to enter into an Assignment of this Lease or a
sublease of the Premises or any portion thereof, it shall first give written
notice to Landlord of its desire to do so, which notice shall contain (a) the
name of the proposed assignee, subtenant or occupant, (b) the nature of the
proposed assignee’s, subtenant’s, or occupant’s business to be carried on in
the Premises, (c) the terms and provisions of the proposed Assignment or
Sublease, and (d) such financial information as Landlord may reasonably request
concerning the proposed assignee, subtenant or occupant.

 

(c)           Except
in the case of transactions not considered Assignments as provided above, at
any time within thirty (30) days after Landlord’s receipt of the notice
specified in Paragraph 11(b), Landlord may by written notice to Tenant elect to
(i) Sublease itself the portion of the Premises specified in Tenant’s notice or
any portion thereof, (ii) take an Assignment of Tenant’s leasehold estate
specified in Tenant’s notice, with a proportionate abatement in Rent and
Additional Charges, (iii) terminate this lease as to the portion (including
all) of the Premises that is specified in Tenant’s notice, with a proportionate
abatement in Rent and Additional Charges, (iv) consent to the Sublease or
Assignment, (v) disapprove the Sublease or Assignment subject to the
limitations set forth in Section 11(a) above. 
As a condition for granting its consent to any Assignment or Sublease,
however, Landlord may require that Tenant pay Landlord the amount by which all
sums payable to Tenant in connection with such Assignment or Sublease exceed
the Rent and Additional Charges hereunder (or a proportionate amount thereof
representing the portion of the Premises subject to a sublease).  In the event Landlord elects to Sublease or
take an Assignment from Tenant as described in clauses (i) and (ii) above, the
rent payable by Landlord shall be the lower of that set forth in Tenant’s
notice or the Rent payable by Tenant under this Lease at the time of the
Assignment or Sublease (or a proportionate amount thereof representing the
portion of the premises subject to the

 

10

 

Sublease or
Assignment if less than the entire Premises). In the event Landlord elects any
of the options set forth in clauses (i), (ii), or (iii) above, with respect to
a portion of the Premises, Tenant shall at all times provide reasonable and
appropriate access to such portion of the Premises and use of any common
facilities, and Landlord shall have the right to use such portion of the
Premises for any legal purpose in its sole discretion and the right to further
assign or sublease the portion of the Premises subject to Landlord’s election
without the consent of Tenant.  If
Landlord consents to the Sublease or Assignment within said thirty (30) day
period, Tenant may thereafter within one hundred twenty (120) days after
Landlord’s consent, but not later than the expiration of said one hundred
twenty (120) days, enter into such Assignment of the Premises or Sublease of
the Premises or portion thereof, upon the terms and conditions set forth in the
notice furnished by Tenant to Landlord pursuant to Paragraph 11(b).

 

(d)           No
consent by Landlord to any Assignment or Sublease by Tenant shall relieve
Tenant of any obligation to be performed by Tenant under this Lease, whether
arising before or after the Assignment or Sublease.  The consent by Landlord to any other Assignment or Sublease shall
not relieve Tenant from the obligation to obtain Landlord’s express written
consent to any other Assignment or Sublease. 
Any Assignment or Sublease that is not in compliance with this Paragraph
11 shall be void.  The provisions of
this subsection (d) shall not apply to any transaction not considered an
Assignment as provided in subsection (a) above.

 

(e)           Each
assignee, sublessee or other transferee, other than Landlord, shall assume, as
provided in this Paragraph 11(e), all obligations of Tenant under this Lease
and shall be and remain liable jointly and severally with Tenant (except that
in the case of transactions not considered Assignments as provided in
subsection (a) above Tenant shall not remain liable) for the payment of Rent
and Additional Charges, and for the performance of all the terms, covenants,
conditions and agreements herein contained on Tenant’s part to be performed for
the Term; provided, however, that the assignee, sublessee, mortgagee, pledgee
or other transferee shall be liable to the Landlord for Rent and Additional
Charges only in the amount set forth in or contemplated by the Assignment or
Sublease.  No Assignment shall be
binding on Landlord unless the assignee or Tenant shall deliver to Landlord a
counter part of the Assignment and an instrument in recordable form that
contains a covenant of assumption by the assignee satisfactory in substance and
form to Landlord, consistent with the requirements of this Paragraph 11(e), but
the failure or refusal of the assignee to execute such instrument of assumption
shall not release or discharge the assignee from its liability as set forth
above.

 

(f)            Notwithstanding
any other provision in this Section 11, Landlord agrees that Tenant shall have
the right to use the Premises in the normal course of Tenant’s business to
provide services to third parties and to permit such third parties and/or such
parties’ equipment to occupy a portion of the Premises.  Such transactions shall not be considered
“subleases” or “assignments” for the purposes of this Section 11.

 

12.          Insurance
and Indemnification

 

(a)           Tenant
shall indemnify and hold Landlord and Trustee harmless from, and defend
Landlord and Trustee against, any and all claims, liability, cost or expense
(including reasonable attorneys’ fees) arising from:

 

(i)            any
injury or damage to persons or property occurring in or about the Premises or
any facilities (including elevators, stairwells or hallways) the use of

 

11

 

which Tenant has in conjunction with other tenants of
the Building, as and to the extent such injury or damage results from the
negligence or fault of Tenant, its agents, servants, employees or invitees; or

 

(ii)           any
breach or default by Tenant in the performance of any covenant or agreement on
the part of Tenant to be performed pursuant to the terms of this Lease.

 

(b)           Landlord
shall indemnify and hold Tenant and Trustee harmless from, and defend Tenant
and Trustee against, any and all claims, liability, cost or expense (including
reasonable attorneys’ fees) arising from:

 

(i)            any
injury or damage to persons or property occurring in or about the Building
(including the Premises), as and to the extent such injury or damage results
from the negligence or fault of Landlord, its agents, servants, employees or
invitees; or

 

(ii)           any
breach or default by Landlord in the performance of any covenant or agreement
on the part of Landlord to be performed pursuant to the terms of this Lease.

 

(c)           Tenant
shall procure at its cost and expense and keep in effect during the Term “Broad
Form” comprehensive general liability insurance including contractual liability
with a minimum combined single limit of liability of One Million Dollars
($1,000,000).  Tenant shall procure at
its cost and expense and keep in effect during the Term “Business Interruption”
insurance in form and in amounts reasonably acceptable to Landlord.  Such insurance shall name Landlord as an additional
insured, shall specifically include the liability assumed hereunder by Tenant,
shall provide that it is primary insurance and not excess over or contributory
with any other valid, existing and applicable insurance in force for and on
behalf of Landlord, and shall provide that Landlord shall receive thirty (30)
days written notice from the insurer prior to the cancellation or change of
coverage (provided that no notice shall be required in the event the policy is
replaced by a policy with equivalent coverage).  Tenant shall deliver certificates reflecting such insurance to
Landlord upon its written request therefor. 
In the event Tenant shall fail to procure such policies or deliver such
certificates, Landlord may, at its option, procure the same for the account of
Tenant and the cost thereof shall be paid to Landlord as Additional Charges
within five (5) days after delivery to Tenant of a statement therefor.

 

(d)           Landlord
shall procure at its cost and expense and keep in effect during the Term (i)
“Broad Form” comprehensive general liability insurance including contractual
liability with a minimum combined single limit of liability of One Million
Dollars ($1,000,000) and (ii) insurance against all risks of physical loss or
damage to the Building,  including the
perils of flood and earthquake, in an amount equal to the full insurable value
thereof.  Landlord shall deliver
certificates reflecting such insurance to Tenant upon its written request
therefor.

 

(e)           Each
of Landlord and Tenant hereby releases the other from all claims for any loss
or damage arising out of or incident to the occurrence of any perils covered
by, or which would be covered by, the insurance policies that each of them is
required to obtain and maintain under the terms of this Lease, except as and to
the extent that any such loss or damage (i) is not, or would not be, covered by
the insurance policies required to be maintained hereunder (giving effect to

 

12

 

limitations of
liability and deductibles) or (ii) is caused by the gross negligence or willful
misconduct of the released party.

 

13.          Waiver of
Subrogation.

 

Landlord and Tenant shall each obtain from their
respective insurers under all policies required to be obtained and maintained
hereunder a waiver of all rights of subrogation which the insurer of one party
might otherwise have against the other party, and Landlord and Tenant shall
each indemnify the other against any loss or expense, including reasonable
attorneys’ fees, resulting from the failure to obtain the same.

 

14.          Services
and Utilities.

 

(a)           Landlord
shall maintain the roof, exterior walls, the exterior  windows in the Building, and the structure itself, in reasonably
good order and condition, consistent with standards found in other similar
buildings in the Nashville Central Business District, except for damage
occasioned by the act of Tenant, which damage shall be repaired by Landlord at
Tenant’s expense.

 

(b)           Landlord
shall not be in default hereunder or be liable for any damages directly or
indirectly resulting from, nor shall the rental herein reserved be abated by
reason of (i) failure to furnish or delay in furnishing any such services when
such failure or delay is caused by acts of God or the elements, labor disturbances
of any character, any other accidents or other conditions beyond the reasonable
control of Landlord, or by the making of repairs or improvements to the
Premises or to the Building, or (ii) the limitation, curtailment, rationing or
restriction on use of water or electricity, gas or any other form of energy or
any other service or utility whatsoever serving the Premises or the Building;
provided, in the case of any of the foregoing, that Landlord shall take all
reasonable steps to remove the cause of any such failure, disturbance, or
restriction.  Furthermore, Landlord
shall be entitled to cooperate voluntarily in a reasonable manner with the
efforts of national, state or local governmental agencies or utilities suppliers
in reducing energy or other resources consumption.

 

15.          Tenant’s
Certificates.

 

Tenant, at anytime and from time to time upon not less
than ten (10) days prior written notice from Landlord, will execute,
acknowledge and deliver to Landlord and, at Landlord’s request, to any
prospective purchaser, ground or underlying lessor or mortgagee of any  part of the Building or the land upon which
the Building is located, a certificate of Tenant stating:  (a) that Tenant has accepted the Premises
(or, if Tenant has not done so, that Tenant has not accepted the Premises and
specifying the reasons therefore), (b) the Commencement and Expiration Dates of
this Lease, (c) that this Lease is unmodified and in full force and effect (or,
if there have been modifications, that same is in full force and effect as
modified and stating the modifications), (d) whether or not there are then
existing any defenses against the enforcement of any of the obligations of
Tenant under this Lease (and, if so specifying same), (e) whether or not there
are then existing any defaults by Landlord in the performance of its
obligations under this Lease (and, if so, specifying same), (f) the dates, if
any, to which the Rent and Additional Charges and other charges under this
Lease have been paid, and (g) any other information that may reasonably be
required by any of such persons.  It is
intended that any such certificate of Tenant delivered pursuant to this
Paragraph 15 may be relied upon by Landlord and any prospective purchaser,
ground or underlying lessor or mortgagee of any part of the Building or the
land upon which the Building is located.

 

13

 

16.          Holding Over.

 

Any holding over after the expiration of the Term with
the consent of Landlord shall be construed to be a tenancy from month-to-month
at one hundred and fifty percent (150%) of the Rent herein specified (prorated
on a monthly basis), unless Landlord shall specify a lesser Rent in its sole
discretion, and shall otherwise be on the terms and conditions herein specified
so far as applicable.  Any holding over
without Landlord’s consent shall constitute a default by Tenant and entitle
Landlord to re-enter the Premises as provided in Paragraphs 19 and 21.

 

17.          Subordination.

 

Without the necessity of any additional document being
executed by Tenant for the purpose of effecting a subordination, this Lease
shall be subject and subordinate at all times to: (a) all ground leases or
underlying leases which may now exist or hereafter be executed affecting the
Building or the land upon which the Building is situated or both, and (b) the
lien of any mortgage or deed of trust which may now exist or hereafter be
executed in any amount for which the Building, land, ground leases or
underlying leases, or Landlord’s interest or estate in any of said terms, is
specified as security.  Notwithstanding
the foregoing, Landlord shall have the right to subordinate or cause to be
subordinated any such ground leases or underlying leases or any such liens to
this Lease.  In the event that any
ground lease or underlying lease terminates for any reason or any mortgage or
deed of trust is foreclosed or a conveyance in lieu of foreclosure is made for
any reason, Tenant shall, notwithstanding any subordination, attorn  to and become the Tenant of the successor in
interest to Landlord at the option of such successor in interest.  Landlord covenants on behalf of itself and
its successors-in-interest that in the event of any such termination,
foreclosure or conveyance, Tenant shall continue to have the right to
possession of the Premises under the terms of this Lease.  Tenant covenants and agrees to execute and
deliver, upon demand by Landlord and in the form requested by Landlord, any
additional documents evidencing the priority or subordination of this Lease with
respect to any such ground leases or underlying leases or the lien of any such
mortgage or deed of trust.

 

18.          Rules
and Regulations.

 

Tenant shall faithfully observe and comply with the
Rules and Regulations attached to this Lease as Exhibit  “B” and all reasonable modifications thereof
and additions thereto from time to time put into effect by Landlord acting in
its reasonable discretion.  In the event
of an express and direct conflict between the terms, covenants, agreements and
conditions of this Lease and those set forth in the rules and regulations, as
modified and amended from time to time by Landlord, this Lease shall control.

 

19.          Re-Entry By
Landlord.

 

(a)           Except
for designated secured areas (“Secured Areas”), Landlord reserves and shall at
all times have the right to re-enter the Premises to inspect the same, to show
the Premises with reasonable advance notice to prospective purchasers,
mortgagees, or tenants, to post notices of non-responsibility, and to alter,
improve or repair the Premises and any portion of the Building without
abatement of Rent or Additional Charges, and may for that purpose erect, use,
and maintain scaffolding, pipes, conduits, and other necessary structures in
and through the Premises where reasonably required by the character of the work
to be performed, provided that the entrance to the

 

14

 

Premises shall not
be blocked thereby, and further provided that the business of Tenant shall not
be materially interrupted.  Landlord
agrees that all persons entering the Premises under its authority shall enter
in accordance with, and at all times abide by, security measures and procedures
established by Tenant.  In connection
with any permitted re-entry as described above, Tenant hereby waives any claim
for damages for any inconvenience to or interference with Tenant’s business or
any loss of occupancy or quiet enjoyment of the Premises occasioned
thereby.  For each of the aforesaid
purposes, Landlord shall at all times have and retain a key with which to
unlock all of the doors in, upon and about the Premises, excluding Tenant’s
vaults and safes or Secured Areas, and Landlord shall have the right to use any
and all means which Landlord may deem necessary or proper to open said doors in
an emergency, in order to obtain entry to any portion of the Premises, and any
entry to the Premises, or portion thereof, obtained by Landlord by any of said
means, or otherwise, shall not under any circumstance be construed or deemed to
be forcible or unlawful entry into, or a detainer of, the Premises, or an
eviction, actual or constructive, of Tenant from the Premises or any portions
thereof.  Landlord shall also have the
right at anytime, without the same constituting an actual or constructive
eviction and with out incurring any liability to Tenant therefore, to change
the arrangement and/or location of entrances or passageways, doors and
doorways, and corridors, elevators, stairs, toilets, or other public parts of
the Building and to change the name, number or designation by which the
Building is commonly known.

 

(b)           For
Secured Areas, Landlord may have access to such portions of the Premises only
upon a reasonable advance request that shall specify the purpose for such
access, permission by Tenant to enter, and being escorted at all times by a
designated representative of Tenant. Landlord agrees that all persons entering
such Secured Areas under the authority of Landlord shall enter in accordance
with, and at all times abide by, the security measures and procedures
established by Tenant.  Notwithstanding
the foregoing, in the event of an emergency, Landlord shall have the right to
enter the Secured Areas with an escort by an employee or apparent agent of
Tenant.

 

20.          Insolvency
or Bankruptcy.

 

The appointment of a receiver to take possession of
all or substantially all of the assets of 
Tenant, or an assignment of Tenant for the benefit of creditors, or any
action taken or suffered by Tenant under any insolvency, bankruptcy,
reorganization or other debtor relief proceedings, whether now existing or
hereafter amended or enacted, shall at Landlord’s option constitute a breach of
this Lease by Tenant.  Upon the
happening of any such event or at anytime thereafter, this Lease shall
terminate five (5) days after written notice of termination from Landlord to
Tenant.  In no event shall this Lease be
assigned or assignable by operation of law or by voluntary or involuntary
bankruptcy proceedings or otherwise and in no event shall this Lease or any
rights or privileges hereunder be an asset of Tenant under any bankruptcy,
insolvency, reorganization or other debtor relief proceeding.

 

21.          Tenant
Default.

 

The failure to perform or honor any covenant,
condition or representation made under this Lease shall constitute a default
hereunder by Tenant unless remedied prior to the expiration of the appropriate
cure period.  Tenant shall have a period
of five (5) business days from the date of written notice from Landlord within
which to cure any default in the payment of Rent or Additional Charges.  Said right to cure shall terminate and
Tenant shall be in breach of its obligations herein and shall be subject to
Landlord’s rights and remedies under the terms of this agreement and any other
rights and remedies available to Landlord at law or equity, should such default
occur more than two times during any twelve (12) month period during the
initial and/or any renewal term of this lease. 
Tenant

 

15

 

shall have a
period of twenty (20) days from the date of written notice from Landlord within
which to cure any default other than a default in the payment of Rent or
Additional Charges under this Lease; provided, however, that with respect to
any default other than the payment of Rent or Additional Charges that cannot
reasonably be cured with in twenty (20) days, the default shall not be deemed
to be uncured if Tenant commences to cure within twenty (20) days from
Landlord’s notice and continues to prosecute diligently the cure thereof.  Upon an uncured default of this Lease by
Tenant, and in addition to Landlord’s rights and remedies under the terms of
this Agreement and any other rights and remedies available to Landlord at law
or in equity, Landlord shall have the following rights and remedies (the choice
of one remedy by Landlord shall not preclude Landlord from seeking another
remedy against Tenant):

 

(a)           The
right to accelerate the Rent and Additional Charges and to recover immediately
from Tenant an amount equal to the present value of the Rent and Additional
Charges for the balance of the Term less the amount  of rental loss for the same period that could not be reasonably
avoided by Landlord.  The right to apply
the Security Deposit to Tenant’s obligations;

 

(b)           The
right to continue this Lease in effect and to enforce all of Landlord’s rights
and remedies under this Lease, including the right to recover Rent and
Additional Charges as they become due, for so long as Landlord does not
terminate Tenant’s right to possession. 
Acts of maintenance or preservation, efforts to relet the Premises or
the appointment of a receiver upon Landlord’s initiative to protect its
interest under this Lease shall not constitute a termination of Tenants right
to possession;

 

(c)           The
right to terminate this Lease;

 

(d)           The
right to change the locks, change any applicable security codes of the
Premises, and remove Tenant’s signs. The right and power to enter the Premises
and remove therefrom all persons and property, to store such property in a
public warehouse or elsewhere at the cost of and for the account of Tenant and
to sell such property.  Landlord may
from time to time sublet Premises or any part thereof for such term or terms
(which may extend beyond the Term) and at such rent and such other terms as
Landlord may deem reasonably advisable, with the right to make alterations and
repair to the Premises.  Upon each such
subletting, (i) Tenant shall be immediately liable to pay to Landlord, in
addition to indebtedness other than Rent and Additional Charges due hereunder,
the cost of such subletting and such alterations and repairs incurred by
Landlord and the amount, if any, by which the Rent and Additional Charges due
hereunder for the period of such subletting (to the extent such period does not
exceed the Term) exceeds the amount to be paid as Rent and Additional Charges
for the Premises for such period or (ii) at the option of Landlord, rents
received from such subletting shall be applied first, to payment of any
indebtedness other than Rent and Additional Charges due hereunder from Tenant
to Landlord; second, to the payment of any costs of such subletting and of such
alterations and repairs; third, to payment of Rent and Additional Charges due
and unpaid hereunder; and the residue, if any, shall be held by Landlord and
applied in payment of future Rent and Additional Charges as the same becomes
due hereunder.  If Tenant has been
credited with any rentals to be received by such subletting under option (i)
and such rentals shall not be promptly paid to Landlord by the sub-tenant(s),
or if such rentals received from such subletting under option (ii) during any
month be less than that to be paid during that month by Tenant hereunder,
Tenant shall pay any such deficiency to Landlord.  Such deficiency shall be calculated and paid monthly.  Notwithstanding any such subletting without
termination, Landlord may at anytime thereafter elect to terminate this Lease
for such previous breach; and

 

16

 

(e)           The
right to have a receiver appointed for Tenant, upon application by Landlord, to
take possession of the Premises and to apply any rental collected from the
Premises and to exercise all other rights and remedies granted to Landlord
pursuant to subparagraph (d) above.

 

22.          Landlord
Default.

 

In the event that Landlord fails to materially provide
any of the services described herein or fails to maintain the Building
structure in an acceptable manner consistent with other similar buildings
located in the Nashville Central Business District, Landlord shall have thirty
(30) days to materially provide all of the services described herein including
maintenance of the Building in a manner consistent with this Agreement.  Notwithstanding anything herein to the
contrary, Tenant shall not be entitle to terminate this Lease so long as
Landlord is diligently pursuing its efforts to cure such default(s) but in no
event more than 60 days after receipt of written notice.  If Landlord should fail to cure any default
described herein within any of the cure periods provided above, Tenant may
without limitation of any other available remedy, terminate this Lease and be
relieved of any further rental payment or other obligations pursuant to the
provisions of this Lease.

 

23.          Damage
By Fire or Other Casualty

 

If the Premises or the Building are damaged by fire or
other casualty, Landlord shall forthwith repair the same, provided that such
repairs can be substantially completed within one hundred twenty (120) days
after the date of such damage and the Premises restored to Tenantable condition
under the laws and regulations of the federal, state and local government
authorities having jurisdiction thereof. 
In such event, this Lease shall remain in full force and effect except
that Tenant shall be entitled to a proportionate reduction of Rent and
Additional Charges while such repairs to be made hereunder by Landlord are
being made. Such proportionate reduction shall be based upon the extent to
which such damage and the making of such repairs by Landlord shall render the
Premises unfit for occupancy or the business carried on by Tenant in the
Premises.  Within thirty (30) days after
the date of such damage, Landlord shall notify Tenant whether or not such repairs
can be substantially completed within one hundred twenty (120) days after the
date of such damage.  If such repairs
cannot be substantially completed within one hundred twenty (120) days of such
damage either party shall then have the option to terminate this Lease as of a
date within thirty (30) days of receipt of such notice as determined by Tenant.

 

24.          Eminent Domain.

 

If any material part of the Building or Premises shall
be taken or appropriated under the power of eminent domain or conveyed in lieu
thereof, and the taking would prevent or materially interfere with the use of
the Premises for the purposes for which it is being used, either party shall
have the right to terminate this Lease at its option.  In such event, Landlord and Tenant shall each receive any income,
rent, award or any interest therein which may be paid in connection with the
exercise of such power of eminent domain in respect of their respective
interests hereunder (including, in the case of Tenant, the value of any
improvements paid for by it). If a part of the Premises shall be so taken or
appropriated or conveyed during the Term and neither party elects to terminate,
the Rent and Additional Charges to be paid under this Lease for the remainder
of the Term shall be proportionately reduced, such reduction to be based upon
the extent to which the partial taking or appropriation or conveyance shall
interfere with the business carried on by Tenant in the Premises.  Notwithstanding anything to the contrary
contained in this Paragraph 24, if the use or occupancy of any part of the
Premises shall be taken or appropriated under power of eminent domain

 

17

 

during the Term
for a period of not more than thirty (30) days, this Lease shall be and remain
unaffected by such taking or appropriation and Tenant shall continue to pay in
full all Rent and Additional Charges payable hereunder by Tenant; in the event
of any such temporary appropriation or taking, Tenant shall be entitled to
receive that portion of any award which represents compensation for the use of
or occupancy of the premises during the period of appropriation, and Landlord
shall be entitled to receive that portion of any award which represents the
cost of restoration of the Premises and the use and occupancy of the premise
after the period of appropriation.

 

25.          Sale By
Landlord.

 

In the event of a sale or conveyance by Landlord of
the Building, any such sale or conveyance shall operate to release Landlord
from any future liability upon any of the covenants or conditions, expressed or
implied, herein contained in favor of Tenant, and in such event Tenant agrees
to look solely to the successor in interest of Landlord in and to this
Lease.  This shall not be affected by
any such sale, and Tenant agrees to attorn to the purchaser or assignee.  Landlord shall ensure that any document of
sale or conveyance requires the purchaser or assignee to assume any and all of
Landlord’s obligations to Tenant under the terms of this Lease so long as Tenant
is not in default of its obligation under the terms of this lease.

 

26.          Right
of Landlord to Perform.

 

All covenants and agreements to be performed by Tenant
under any of the terms of this Lease shall be performed by Tenant at Tenant’s
sole cost and expense and without any abatement of Rent and Additional
Charges.  If Tenant shall fail to pay
any sum of money, other than Rent and Additional Charges, required to be paid
by it hereunder or shall fail to perform any other act on its part to be
performed hereunder, and such failure shall continue for twenty (20) days after
notice thereof by Landlord, Landlord may, but shall not be obligated to do so,
and without waiving or releasing Tenant from any obligations of Tenant, make
any such payment or perform any such act on Tenant’s part to be made or performed
as provided in this Lease.  All sums so
paid by Landlord and all necessary incidental costs together with interest
thereon at the maximum rate permitted by law, from the date of such payment by
Landlord shall be payable as Additional Charges to Landlord on demand.

 

27.          Surrender
of Premises.

 

(a)           At
the end of the Term or any renewal thereof or other sooner termination of this
Lease, Tenant will peaceably deliver to Landlord possession of the Premises,
together with all improvements or additions upon or belonging to the same, by
whomsoever made, in the same condition as received, or first installed,
ordinary wear and tear, damaged by fire, earthquake, act of God, or the
elements alone excepted.  The Premises
shall be broom clean and free of rubbish and Tenant’s personal property.  Tenant may, upon the termination of this
Lease, remove all movable furniture and equipment belonging to Tenant, whether
or not attached to or installed in the Premises, at Tenant’s sole cost, title
to which shall be in Tenant, provided that Tenant repairs any damage caused by
such removal.  Property not so removed
shall be deemed abandoned by Tenant and title to the same shall thereupon pass
to Landlord.  Upon request by Landlord,
unless otherwise agreed to in writing by Landlord, Tenant shall remove, at
Tenant’s sole cost, all moveable furniture and equipment belonging to Tenant
which may be left by Tenant and repair any damage, resulting from such removal.

 

18

 

(b)           The
voluntary or other surrender of this Lease by Tenant, or a mutual cancellation
thereof, shall not work a merger, and shall, at the option of Landlord,
terminate all or any existing subleases or subtenancies, or may, at the option
of Landlord, operate as an assignment to it of any or all such subleases or
subtenancies.

 

28.          Waiver.

 

If either Landlord or Tenant waives the performance of
any term, covenant or condition contained in this Lease, such waiver shall not
be deemed to be a waiver of any subsequent breach of the same or any other
term, covenant or condition contained herein. 
Furthermore, the acceptance of Rent and Additional Charges by Landlord
shall not constitute a waiver of any preceding breach by Tenant of any term,
covenant or condition of this Lease, regardless of Landlord’s knowledge of such
preceding breach at the time Landlord accepted such Rent and Additional
Charges. Failure by Landlord to enforce any of the terms, covenants or
conditions of this Lease for any length of time shall not be deemed to waive or
to decrease the right of Landlord to insist thereafter upon strict performance
by Tenant.  Waiver by Landlord of any
term, covenant or condition contained in this Lease may only be made by a
written document signed by Landlord.

 

29.          Notices

 

Except as otherwise expressly provided in this Lease,
any bills statement, notices, demands, requests or other communications given
or required to be given under this Lease shall be effective only if rendered or
given in writing, sent by registered or certified mail or delivered personally
or by overnight carrier,

 

(a)           to
Tenant

 

(i)            at
Tenant’s address set forth in the Basic Lease Information, attached hereto as
Exhibit “A1”, if sent prior to Tenant’s taking possession of the Premises, or;

(ii)           at
the Premises if sent subsequent to Tenant’s taking possession of the Premises,
or;

(iii)          at
any place where Tenant may be found if sent subsequent to Tenant’s vacating,
deserting, abandoning or surrendering the Premises, or;

 

(b)           to
Landlord at Landlord’s address set forth in the Basic Lease Information, or;

 

(c)           to
such other address as either Landlord or Tenant may designate at its new
address for such purpose by notice given to the other in accordance with the
provisions of this Paragraph 29.  Any
such bill, statement, notice, demand, request or other communication shall be
deemed to have been rendered or given three (3) days after the date when it
shall have been mailed as provided in this paragraph 29 if sent by registered
or certified mail, or upon the date personal delivery is made.  If Tenant is notified of the identity and
address of Landlord’s mortgagee or ground or underlying lessor, Tenant shall
give to such mortgagee or ground or underlying lessor notice of any default by
Landlord under the terms of this Lease in writing sent by registered or
certified mail, and such mortgagee or ground or underlying lessor shall be
given a reasonable opportunity to cure such default prior to Tenant exercising
any remedy available to it.

 

19

 

30.          Abandonment.

 

Tenant shall not abandon the Premises at any time
during the Term, and if Tenant shall abandon or surrender the Premises or be
dispossessed by process of law, or otherwise, any personal property belonging
to Tenant and left on the Premises shall, at the option of Landlord, be deemed
to be abandoned and title thereto shall thereupon pass to Landlord if not
removed within ten (10) business days after receipt of notice from Landlord to
such effect, except such property as may be mortgaged to Landlord.

 

31.          Successors
and Assigns.

 

Subject to the provisions of Paragraph 11, the terms,
covenants and conditions contained herein shall be binding upon and inure to
the benefit of the parties hereto and their respective legal and personal
representatives, successors and assigns.

 

32.          Attorney’s Fees.

 

If Tenant or Landlord brings any action for any relief
against the other, declaratory or otherwise, arising out of this Lease,
including any suit by Landlord for the recovery of Rent or Additional Charges
or possessions of the Premises, the losing party shall pay to the prevailing
party a reasonable sum for attorney’s fees, which shall be deemed to have
accrued on the commencement of such action and shall be paid whether or not the
action is prosecuted to judgment or otherwise settled among the parties.

 

33.          Miscellaneous.

 

(a)           The
term “Premises” wherever it appears herein includes and shall be deemed or
taken to include (except where such meaning would be clearly repugnant to the
context) the office space demised and improvements now or at any time
hereinafter comprising or built in the space hereby demised.  The paragraph headings herein are for
convenience of reference and shall in no way define, increase, limit or
describe the scope or intent of any provision of this Lease.  The term “Landlord” shall include Landlord
and its successors and assigns.  In any
case where this Lease is signed by more than one person, the obligations
hereunder shall be joint and several. 
The term “Tenant” or any pronoun used in place thereof shall indicate
and include the masculine or feminine, the singular or plural number,
individuals, firms or corporations, and their and each of their respective
successors, executors, administrators, and permitted assigns, according to the
context hereof.

 

(b)           Time
is of the essence of this Lease and all of its provisions.  This Lease shall in all respects be governed
by the laws of the State of Tennessee. 
This Lease, together with its exhibits, contains all the agreements of
the parties hereto and supersedes any previous negotiations.  There have been no representations made by
the Landlord or understandings made between the parties other than those set
forth in this Lease and its exhibits. 
This Lease may not be modified except by a written instrument by the
parties hereto.

 

(c)           If
for any reason whatsoever any of the provisions hereof shall be unenforceable
or ineffective, all of the other provisions shall be and remain in full force
and effect.

 

20

 

(d)           Upon
Tenant paying the Rent and Additional Charges and performing all of Tenant’s
obligations under this Lease, Tenant may peacefully and quietly enjoy the
Premises during the Term as against all persons or entities lawfully claiming
by or through Landlord.

 

34.          Parallel Gear

 

Tenant and Landlord agree and acknowledge that the
Building contains certain specialized electronic switching equipment (the
“Parallel Gear”).  The Parallel Gear is
not currently owned by Landlord, but prior to the Commencement Date, Landlord
shall purchase the Parallel Gear. 
Tenant shall maintain the Parallel Gear in its current condition, shall
maintain a service contract for the Parallel Gear with a service provider
approved in advance by Landlord (which consent shall not be unreasonably
withheld), shall provide quarterly reports to Landlord regarding the
maintenance status of the Parallel Gear, and shall have the right to use the
Parallel Gear throughout the term of the Lease.  In the event that Tenant connects a second generator (or other
similar equipment) to the Parallel Gear at any time during the Term of this
Lease, Tenant shall immediately provide written notice to Landlord, and Tenant
shall immediately pay to Landlord the amount of $50,000.  In the event that Tenant fails to make such
payment within five (5) days from connecting the second generator as provided
above, then Tenant shall be in default hereunder and Landlord shall have the
right to remove the Parallel Gear immediately without further notice to Tenant
and without liability to Tenant.  Upon
the expiration of the Term of the Lease, the Parallel Gear shall be the
property of Landlord.

 

35.          Limitation of Landlord’s Liability.

 

Tenant recognizes that Landlord is a limited liability
company.  It is expressly understood and
agreed by and between the parties hereto that anything herein to the contrary
notwithstanding, that each and all of the representations, covenants,
undertakings and agreements herein made on the part of Landlord are intended
not as personal representations, covenants, undertakings and agreements of the
members of Landlord, but are made an intended for the purpose of binding
Landlord and  Landlord’s interest in the
Building.  No personal liability or
personal responsibility is assumed by nor shall at anytime be asserted or
enforced against, any of the members of Landlord on account of this Lease.  All such personal liability, if any, being
expressly waived and released by Tenant herein, and by all persons claiming by,
through or under Tenant.

 

36.          Limitation of Trustee’s Liability.

 

It is expressly understood and agreed by Tenant that,
anything herein to the contrary notwithstanding, that each and all of the
representations, covenants, undertakings and agreements herein made on the part
of Trustee, if any, are intended not as personal representations, covenants,
undertakings and agreements of Trustee, but are made an intended for the
purpose of binding Trustee’s interest in the Premises.  No personal liability or personal responsibility
is assumed by nor shall at anytime be asserted or enforced against, Trustee on
account of this Lease.  All such
personal liability, if any, being expressly waived and released by Tenant
herein, and by all persons claiming by, through or under Tenant.  Trustee shall not be liable for
consequential damages arising out of any breach of default under this
Agreement, including, without limitation, loss of use or income from the
Building or the Premises or any equipment or facilities therein, whether by
Tenant or any person claiming through or under Tenant.  Tenant shall look only to Trustee’s interest
in the Premises (or the proceeds thereof) for satisfaction of Tenant’s remedies
or for the collection of a judgment or other judicial process requiring the
payment of money by Trustee in the event of any default by Trustee

 

21

 

hereunder, and no
other property or assets of Trustee, or its partners, members, principals or
related entities, disclosed or undisclosed, shall be subject to levy, execution
or other enforcement procedure for the satisfaction of Tenant’s remedies under
or with respect to the Lease, the relationship of Trustee and Tenant hereunder
or Tenant’s use and occupancy of the Premises.

 

37.          Tenant
Improvements.

 

Any improvements to the Premises shall be made by
Tenant, at Tenant’s sole cost in a first class manner in accordance with all
applicable laws and regulations.

 

38.          Special
Stipulations.

 

Tenant shall have the right to use all parking spaces
adjacent to the Building upon commencement of this Lease at no additional
charge.  Tenant shall also have the
right to use the vacant lot adjacent to the Building owned by Landlord for
Tenant’s parking until such time that Landlord provides written notice to
Tenant.  In the event that such vacant
lot is no longer available to Tenant, then Landlord shall provide additional
off-site parking to Tenant at no additional charge for up to 30 total parking
spaces (including any spaces at the Building).

 

39.          Brokerage.

 

Tenant represents and warrants to Landlord that it has
not dealt with any broker in connection 
with this Lease.  Landlord
represents and warrants to Tenant that it has not dealt with any broker in
connection with this Lease other than Armistead Barkley, Inc.  The execution and delivery of this Lease by
each party shall be conclusive evidence that such party has relied upon the
foregoing representation and warranty.  Tenant
shall indemnify and hold Landlord harmless from and against any and all claims
for commissions, fees or other compensation by any person who shall claim to
have dealt with Tenant in connection with this Lease and for any and all costs
incurred by Landlord in connection with such claims, including, without
imitation, reasonable attorney’s fees and disbursements. Landlord shall
indemnify and hold Tenant harmless from and against any and all claims or
commissions, fees or other compensation by Broker and any person who shall
claim to have dealt with Landlord in connection with this Lease and for any and
all costs incurred by Tenant in connection with such claims, including, without
limitation, reasonable attorneys’ fees and disbursements.  The provisions of this Paragraph 39 shall
survive the expiration or earlier termination of this Lease.

 

40.          Force Majeure.

 

In the event of strike, lockout,
labor trouble, civil commotion, Act of God, or any other cause beyond a party’s
control (collectively “force majeure”) resulting in either party’s inability
to supply the services or perform the other obligations required of Landlord
hereunder, this Lease shall not terminate and Tenant’s obligation to pay Rent
and all other charges and sums due and payable by Tenant shall not be affected
or excused and Landlord shall not be considered to be in default under this
Lease.  If, as a result of force
majeure, either party is delayed in performing any of its obligations under
this Lease, other than Tenant’s obligation to pay Rent and all other charges
and sums payable by Tenant hereunder, Tenant’s performance shall be excused for
a period equal to such delay and Tenant shall not during such period be
considered to be in default under this Lease with respect to the obligation,
performance of which has thus been delayed.

 

22

 

IN
WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.

 

	
  LANDLORD:

  	
  TENANT:

  
	
   

  	
   

  
	
  Nashville Urban Partners 2000 II,
  LLC

  	
  Codigent Solutions Group, Inc.

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
								

 

23

 

Exhibit
A

 

Floorplan of the Building

 

24

 

Exhibit
B

Rules and Regulations

 

1.                                       Landlord
agrees to furnish Tenant five keys without charge.  Additional keys will be furnished at a nominal charge.  Except for Secured Areas, Tenant shall not
change locks or install additional locks on doors without prior written consent
of Landlord, which shall not be unreasonably withheld.  Tenant shall not make or cause to be made
duplicates of keys procured from Landlord without prior approval of
Tenant.  All keys to premises shall be
surrendered to Landlord upon termination of this Lease.

 

2.                                       Tenant
will refer all contractors, contractor’s representatives and installation
technicians rendering any service on or to the premises for Tenant to Landlord
for Landlord’s approval before performance of any contractual service.  Tenant’s contractors and installation
technicians shall comply with Landlord’s rules and regulations pertaining to
construction and installation.  This
provision shall apply to all work performed on or about the premises or
project, including installation of telephones, telegraph equipment, electrical
devices and attachments and installations of any nature affecting floors,
walls, woodwork, trim, windows, ceilings and equipment or any other physical
portion of the premises or project.

 

3.                                       Tenant
shall not at any time occupy any part of the premises or project as sleeping or
lodging quarters.

 

4.                                       Except
for operations contemplated by the Lease, including those materials and
equipment  necessary to maintain
emergency power, Tenant shall not place, install or operate on the premises or
in any part of the building any engine or machinery, or conduct mechanical
operations thereon or therein, or place or use in or about the premises or
project any explosives, gasoline, kerosene, oil, acids, caustics, or any
flammable, explosive or hazardous material without written consent of Landlord,
which consent shall not be unreasonably withheld.

 

5.                                       Landlord
will not be responsible for lost or stolen personal property, equipment, money
or jewelry from the premises or the project regardless of whether such loss
occurs when the area is locked against entry or not.

 

6.                                       No
dogs, cats, fowl, or other animals shall be brought into or kept in or about
the Building.

 

7.                                       Employees
of Landlord shall not receive or carry messages for or to any Tenant or other
person or contract with or render free or paid services to any Tenant or to any
of Tenant’s agents, employees or invitees.

 

8.                                       None
of the parking, entries, passages, doors, hallways or stairways shall be
blocked or obstructed or any rubbish, litter, trash, or material of any nature
placed, emptied or thrown into these areas or such area used by Tenant’s
agents, employees or invitees at any time for purposes inconsistent with their
designation by Landlord.

 

9.                                       The
water closets and other water fixtures shall not be used for any purpose other
than those for which they were constructed, and any damage resulting to them
from misuse or by the defacing or injury of any part of the building shall be
borne by the person who shall occasion it. 
No person shall waste water by interfering with the faucets or
otherwise.

 

25

 

10.                                 Parking
is prohibited in areas not striped for parking and in other areas as may be
designated by Landlord.  Every person is
required to park and lock his vehicle. All responsibility for damage to
vehicles or persons is assumed by the owner of the vehicle or its driver.

 

11.                                 Tenant
shall not lay floor covering within the premises without written approval of
the Landlord. The use of cement or other similar adhesive materials not easily
removed with water is expressly prohibited.

 

12.                                 It
is Landlord’s desire to maintain in the building or project the highest
standard of dignity and good taste consistent with comfort and convenience for
tenants.  Any action or condition not
meeting this high standard should be reported directly to Landlord.  Your cooperation will be mutually beneficial
and sincerely appreciated. Landlord reserves the right to make such other and
further reasonable rules and regulations as in its judgment may from time to
time be necessary, for the safety, care and cleanliness of the premises and for
the preservation of good order therein.

 

26

 

Exhibit
C

 

Security Fence

 

27

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