Document:

Exhibit 10.21

    
      

    

    
      [California
        Net Lease]

      

      LEASE
        AGREEMENT 

      

      

      THIS
        LEASE AGREEMENT is made this 19th
        day of
        January, 2007, between CATELLUS
        OPERATING LIMITED PARTNERSHIP
        ("Landlord"), and the Tenant named below.

       

      
        

          
            	
                    Tenant:

                  	 	
                    ViewSonic
                      Corporation, a Delaware corporation

                  
	 	 	 	
                     

                  	 	 	 
	
                    Tenant’s
                      Representative, 

                  	 	 	
                     

                  	 	 	 
	
                    Address,
                      and Telephone:

                  	 	 	
                     

                  	 	 	 
	 	 	
                    381
                      S. Brea Canyon Road

                  	 	 	 
	 	 	
                    City
                      of Industry,
                      CA 91789 

                  	 	 	 
	 	 	
                    909-444-8663

                  	 	 	 
	 	 	 	
                     

                  	 	 	 
	
                    Premises:

                  	 	
                    The
                      entire Building, containing approximately 298,050
                      rentable square feet, as determined by Landlord, as shown on
                      Exhibit A.
                      

                  
	 	 	 	
                     

                  	 	 	 
	
                    Project:

                  	 	
                    Industry
                      Distribution Center #4-10

                  
	 	 	 	
                     

                  	 	 	 
	
                    Building:

                  	 	
                    Industry
                      Distribution Center #9

                  
	 	 	
                    381
                      S. Brea Canyon Road

                  
	 	 	
                                  
                      

                  	 	 	 
	 	 	
                    City
                      of Industry ,
                      CA 91789 

                  
	 	 	 	
                     

                  	 	 	 
	
                    Tenant's
                      Proportionate Share of Project:

                  	 	
                    19.030%

                  	 	 	 
	 	 	 	
                     

                  	 	 	 
	
                    Tenant's
                      Proportionate Share of Building:

                  	 	
                    100.000%

                  	 	 	 
	 	 	 	
                     

                  	 	 	 
	
                    Lease
                      Term:

                  	 	
                    Beginning
                      on the Commencement Date and ending on the last day of the 85th full
                      calendar month thereafter.

                  
	 	 	 	
                     

                  	 	 	 
	
                    Commencement
                      Date:

                  	 	
                    July
                      1, 2007

                  	 	 	 
	 	 	 	
                     

                  	 	 	 
	
                    Initial
                      Monthly Base Rent:

                  	
                  	
                     

                  	
                     

                  	 	 	
                    See
                      Addendum 1 

                  
	 	 	
                     

                  	
                     

                  	 	 	 
	 	 	
                     

                  	
                     

                  	 	 	 
	
                    Initial
                      Estimated Monthly 

                  	 	
                    1.
                      Utilities:

                  	
                     

                  	 	
                    $1,445.00

                  	 
	
                    Operating
                      Expense Payments:

                  	 	
                     

                  	
                     

                  	 	 	 
	
                    (estimates
                      only and subject to 

                  	 	
                    2.
                      Common Area Charges:

                  	 	
                    $4,567.00*

                  	 
	
                    adjustment
                      to actual costs and

                  	 	
                     

                  	
                     

                  	 	 	 
	
                    expenses
                      according to the

                  	 	
                    3.
                      Taxes:

                  	
                     

                  	 	
                    $30,578.00

                  	 
	
                    provisions
                      of this Lease)

                  	 	
                     

                  	
                     

                  	 	 	 
	             	 	
                    4.
                      Insurance:

                  	 	
                    $4,918.00

                  	 
	 	 	
                     

                  	
                     

                  	 	 	 
	 	 	
                    5.
                      Others:

                  	
                    Prop
                      Mgmt Fee 

                  	 	
                    $3,378.00*

                  	 
	 	 	
                    *Property
                      Management Fee not to exceed 2% of gross receipts (as defined
                      in Paragraph
                      6), inclusive of any Property Management overhead reimbursement
                      

                  
	
                    Initial
                      Estimated Monthly Operating Expense Payments:

                  	 	
                     

                  	
                     

                  	 	 	
                    $44,886.00

                  
	             	 	
                     

                  	
                     

                  	 	 	 
	
                    Initial
                      Monthly Base Rent and Operating Expense Payments:

                  	 	
                    $44,886.00
                      (includes free rent for this initial month)

                  
	             	 	
                     

                  	
                     

                  	 	 	 
	
                    Security
                      Deposit:

                  	 	
                    $0.00

                  	
                     

                  	 	 	 
	 	 	
                     

                  	
                     

                  	 	 	 
	
                    Broker:

                  	 	
                    Cushman
                      & Wakefield of California, Inc.

                  
	 	 	
                     

                  	
                     

                  	 	 	 
	
                    Addenda:

                  	 	
                    1.
                      Base Rent Adjustments 2. Cap on Controllable Operating Expenses
                      3. Renewal
                      Option (Baseball Arbitration) 4. Construction (Turnkey) 5.
                      HVAC
                      Maintenance Contract 6. Move Out Conditions

                  
	 	 	
                     

                  	
                     

                  	 	 	 
	
                    Exhibits:

                  	 	
                    A.
                      Site Plan

                  	 

          

        

      

       

       

      1.   Granting
        Clause.
        In
        consideration of the obligation of Tenant to pay rent as herein provided
        and in
        consideration of the other terms, covenants, and conditions hereof, Landlord
        leases to Tenant, and Tenant takes from Landlord, the Premises, to have and
        to
        hold for the Lease Term, subject to the terms, covenants and conditions of
        this
        Lease.

      
        
          
          

        

        
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      2.   Acceptance
        of Premises.
        Tenant
        shall accept the Premises in its condition as of the Commencement Date, subject
        to all applicable laws, ordinances, regulations, covenants and restrictions.
        Landlord has made no representation or warranty as to the suitability of
        the
        Premises for the conduct of Tenant's business, and Tenant waives any implied
        warranty that the Premises are suitable for Tenant's intended purposes. Except
        as provided in Paragraph 10, in no event shall Landlord have any obligation
        for
        any defects in the Premises or any limitation on its use. The taking of
        possession of the Premises shall be conclusive evidence that Tenant accepts
        the
        Premises and that the Premises were in good condition at the time possession
        was
        taken except for items that are Landlord's responsibility under Paragraph
        10 and
        any punchlist items agreed to in writing by Landlord and Tenant.

      

      3.   Use.
        The
        Premises shall be used only for the purpose of receiving, storing, shipping
        and
        selling (but limited to wholesale sales) products, materials and merchandise
        made and/or distributed by Tenant and for such other lawful purposes as may
        be
        incidental thereto; provided, however, with Landlord's prior written consent,
        Tenant may also use the Premises for light manufacturing. Tenant shall not
        conduct or give notice of any auction, liquidation, or going out of business
        sale on the Premises. Tenant will use the Premises in a careful, safe and
        proper
        manner and will not commit waste, overload the floor or structure of the
        Premises or subject the Premises to use that would damage the Premises. Tenant
        shall not permit any objectionable or unpleasant odors, smoke, dust, gas,
        noise,
        or vibrations to emanate from the Premises, or take any other action that
        would
        constitute a nuisance or would disturb, unreasonably interfere with, or endanger
        Landlord or any tenants of the Project. Outside storage, including without
        limitation, storage of trucks and other vehicles, is prohibited without
        Landlord's prior written consent. Tenant, at its sole expense, shall use
        and
        occupy the Premises in compliance with all laws, including, without limitation,
        the Americans With Disabilities Act, orders, judgments, ordinances, regulations,
        codes, directives, permits, licenses, covenants and restrictions now or
        hereafter applicable to the Premises (collectively, "Legal Requirements")
        unless
        such Legal Requirements are met due to their “grandfathered” nature. The
        Premises shall not be used as a place of public accommodation under the
        Americans With Disabilities Act or similar state statutes or local ordinances
        or
        any regulations promulgated thereunder, all as may be amended from time to
        time.
        Tenant shall, at its expense, make any alterations or modifications, within
        or
        without the Premises, that are required by Legal Requirements related to
        Tenant's use or occupation of the Premises unless such Legal Requirements
        are
        met due to their “grandfathered” nature. Tenant will not use or permit the
        Premises to be used for any purpose or in any manner that would void Tenant's
        or
        Landlord's insurance, increase the insurance risk, or cause the disallowance
        of
        any sprinkler credits. If any increase in the cost of any insurance on the
        Premises or the Project is caused by Tenant's use or occupation of the Premises,
        or because Tenant vacates the Premises, then Tenant shall pay the amount
        of such
        increase to Landlord. Any occupation of the Premises by Tenant prior to the
        Commencement Date shall be subject to all obligations of Tenant under this
        Lease. 

      

      4.   Base
        Rent.
        Tenant
        shall pay Base Rent in the amount set forth above. The first month's Base
        Rent,
        the Security Deposit, and the first monthly installment of estimated Operating
        Expenses (as hereafter defined) shall be due and payable on the date hereof,
        and
        Tenant promises to pay to Landlord in advance, without demand, deduction
        or
        set-off, monthly installments of Base Rent on or before the first day of
        each
        calendar month succeeding the Commencement Date. Payments of Base Rent for
        any
        fractional calendar month shall be prorated. All payments required to be
        made by
        Tenant to Landlord hereunder (or
        to
        such other party as Landlord may from time to time specify in writing) shall
        be
        made by Electronic Fund Transfer (“EFT”) or by check of immediately available
        federal funds before 11:00 a.m., Eastern Time, at such place, within the
        continental United States, as Landlord may from time to time designate to
        Tenant
        in writing.
        The
        obligation of Tenant to pay Base Rent and other sums to Landlord and the
        obligations of Landlord under this Lease are independent obligations. Tenant
        shall have no right at any time to abate, reduce, or set-off any rent due
        hereunder except as may be expressly provided in this Lease. If Tenant is
        delinquent in any monthly installment of Base Rent or of estimated Operating
        Expenses for more than 5 business days, Tenant shall pay to Landlord on demand
        a
        late charge equal to 8 percent of such delinquent sum. The provision for
        such
        late charge shall be in addition to all of Landlord's other rights and remedies
        hereunder or at law and shall not be construed as a penalty.

      

      5.   Security
        Deposit.
        Intentionally Omitted.

      

      6.   Operating
        Expense Payments.
        During
        each month of the Lease Term, on the same date that Base Rent is due, Tenant
        shall pay Landlord an amount equal to 1/12 of the annual cost, as estimated
        by
        Landlord from time to time, of Tenant's Proportionate Share (hereinafter
        defined) of Operating Expenses for the Project. Payments thereof for any
        fractional calendar month shall be prorated. The term "Operating Expenses"
        means
        all costs and expenses incurred by Landlord with respect to the ownership,
        maintenance, and operation of the Project including, but not limited to costs
        of: Taxes (hereinafter defined) and fees payable to tax consultants and
        attorneys for consultation and contesting taxes; insurance; utilities;
        maintenance, repair and replacement of all portions of the Project, including
        without limitation, paving and parking areas, roads, roofs (including
        the roof membrane),
        alleys,
        and driveways, mowing, landscaping, exterior painting, utility lines, heating,
        ventilation and air conditioning systems, lighting, electrical systems and
        other
        mechanical and building systems; amounts paid to contractors and subcontractors
        for work or services performed in connection with any of the foregoing; charges
        or assessments of any association to which the Project is subject; property
        management fees (not
        to
        exceed 2% of gross receipts payable by Tenant to Landlord per the terms of
        this
        Lease which shall include the sum of Base Rent and Operating
        Expenses)
        payable
        to a property manager, including any affiliate of Landlord, or if there is
        no
        property manager, an administration fee of 15 percent of Operating Expenses
        payable to Landlord; security services, if any; trash collection, sweeping
        and
        removal; and additions or alterations made by Landlord to the Project or
        the
        Building in order to comply with Legal Requirements (other than those expressly
        required herein to be made by Tenant) or that are appropriate to the continued
        operation of the Project or the Building as a bulk warehouse facility in
        the
        market area, provided that the cost of additions or alterations that are
        required to be capitalized for federal income tax purposes shall be amortized
        on
        a straight line basis over a period equal to the lesser of the useful life
        (in
        accordance with generally
        accepted accounting principles
        (“GAAP”)) thereof for federal income tax purposes or 10 years, whichever is
        longer. Operating Expenses do not include:

      
        	 	
                (a)

              	
                costs,
                  expenses, depreciation or amortization for capital repairs and
                  capital
                  replacements required to be made by Landlord under Paragraph 10
                  of this
                  Lease; 

              

      

      
        
          
          

        

        
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                (b)

              	
                debt
                  service under mortgages or ground rent under ground leases, costs
                  of
                  restoration to the extent of net insurance proceeds received by
                  Landlord
                  with respect thereto;

              

      

      
        	 	
                (c)

              	
                marketing
                  costs for the Project, including without limitation, leasing commissions,
                  attorneys’ fees in connection with the negotiation and preparation of
                  letters, deal memos, letters of intent, leases, subleases and/or
                  assignments, space planning costs, and other costs and expenses
                  incurred
                  in connection with lease, sublease and/or assignment negotiations
                  and
                  transactions with Tenant or present or prospective tenants or other
                  occupants of the Building;

              

      

      
        	 	
                (d)

              	
                the
                  costs of renovating space for
                  tenants;

              

      

      
        	 	
                (e)

              	
                costs
                  incurred in connection with any environmental clean-up, response
                  action,
                  or remediation on, in, under or about the Premises or the Building
                  which
                  are Landlord’s obligations per Paragraph 30 of this Lease (specifically
                  excluding any such costs which were incurred as a result of the
                  actions or
                  omissions of Tenant, or Tenant’s employees, agents or
                  contractors);

              

      

      
        	 	
                (f)

              	
                “In-house”
                  legal and/or accounting fees.

              

      

      

      If
        Tenant's total payments of Operating Expenses for any year are less than
        Tenant's Proportionate Share of actual Operating Expenses for such year,
        then
        Tenant shall pay the difference to Landlord within 30 days after demand,
        and if
        more, then Landlord shall retain such excess and credit it against Tenant's
        next
        payments. For purposes of calculating Tenant's Proportionate Share of Operating
        Expenses, a year shall mean a calendar year except the first year, which
        shall
        begin on the Commencement Date, and the last year, which shall end on the
        expiration of this Lease. With respect to Operating Expenses which Landlord
        allocates to the entire Project, Tenant's "Proportionate Share" shall be
        the
        percentage set forth on the first page of this Lease as Tenant's Proportionate
        Share of the Project as reasonably adjusted by Landlord in the future for
        changes in the physical size of the Premises or the Project; and, with respect
        to Operating Expenses which Landlord allocates only to the Building, Tenant's
        "Proportionate Share" shall be the percentage set forth on the first page
        of
        this Lease as Tenant's Proportionate Share of the Building as reasonably
        adjusted by Landlord in the future for changes in the physical size of the
        Premises or the Building. Landlord may equitably increase Tenant's Proportionate
        Share for any item of expense or cost reimbursable by Tenant that relates
        to a
        repair, replacement, or service that benefits only the Premises or only a
        portion of the Project or Building that includes the Premises or that varies
        with occupancy or use. The estimated Operating Expenses for the Premises
        set
        forth on the first page of this Lease are only estimates, and Landlord makes
        no
        guaranty or warranty that such estimates will be accurate.

      

      7.   Utilities.
        Tenant
        shall pay for all water, gas, electricity, heat, light, power, telephone,
        sewer,
        sprinkler services, refuse and trash collection, and other utilities and
        services used on the Premises, all maintenance charges for utilities, and
        any
        storm sewer charges or other similar charges for utilities imposed by any
        governmental entity or utility provider, together with any taxes, penalties,
        surcharges or the like pertaining to Tenant's use of the Premises. Landlord
        may
        cause at Tenant's expense any utilities to be separately metered or charged
        directly to Tenant by the provider. Tenant shall pay its share of all charges
        for jointly metered utilities based upon consumption, as reasonably determined
        by Landlord. No interruption or failure of utilities shall result in the
        termination of this Lease or the abatement of rent. Tenant agrees to limit
        use
        of water and sewer for normal restroom use.

      

      8.   Taxes.
        Landlord shall pay all taxes, assessments and governmental charges (collectively
        referred to as "Taxes") that accrue against the Project during the Lease
        Term,
        which shall be included as part of the Operating Expenses charged to Tenant.
        Landlord may contest by appropriate legal proceedings the amount, validity,
        or
        application of any Taxes or liens thereof. All capital levies or other taxes
        assessed or imposed on Landlord upon the rents payable to Landlord under
        this
        Lease and any franchise tax, any excise, transaction, sales or privilege
        tax,
        assessment, levy or charge measured by or based, in whole or in part, upon
        such
        rents from the Premises and/or the Project or any portion thereof shall be
        paid
        by Tenant to Landlord monthly in estimated installments or upon demand, at
        the
        option of Landlord, as additional rent; provided, however, in no event shall
        Tenant be liable for any net income taxes imposed on Landlord unless such
        net
        income taxes are in substitution for any Taxes payable hereunder. If any
        such
        tax or excise is levied or assessed directly against Tenant, then Tenant
        shall
        be responsible for and shall pay the same at such times and in such manner
        as
        the taxing authority shall require. Tenant shall be liable for all taxes
        levied
        or assessed against any personal property or fixtures placed in the Premises,
        whether levied or assessed against Landlord or Tenant.

      

      9.   Insurance.
        Landlord shall maintain all risk property insurance covering the full
        replacement cost of the Building. Landlord may, but is not obligated to,
        maintain such other insurance and additional coverages as it may deem necessary,
        including, but not limited to, commercial liability insurance and rent loss
        insurance. All such insurance shall be included as part of the Operating
        Expenses charged to Tenant. The Project or Building may be included in a
        blanket
        policy (in which case the cost of such insurance allocable to the Project
        or
        Building will be determined by Landlord based upon the insurer's cost
        calculations). Tenant shall also reimburse Landlord for any increased premiums
        or additional insurance which Landlord reasonably deems necessary as a result
        of
        Tenant's use of the Premises.

      

      Tenant,
        at its expense, shall maintain during the Lease Term: all risk property
        insurance covering the full replacement cost of all property and improvements
        installed or placed in the Premises by Tenant at Tenant's expense; worker's
        compensation insurance with no less than the minimum limits required by law;
        employer's liability insurance with such limits as required by law; and
        commercial liability insurance, with a minimum limit of $1,000,000 per
        occurrence and a minimum umbrella limit of $1,000,000, for a total minimum
        combined general liability and umbrella limit of $2,000,000 (together with
        such
        additional umbrella coverage as Landlord may reasonably require) for property
        damage, personal injuries, or deaths of persons occurring in or about the
        Premises. Landlord may from time to time require reasonable increases in
        any
        such limits. The commercial liability policies shall name Landlord as an
        additional insured, insure on an occurrence and not a claims-made basis,
        be
        issued by insurance companies which are reasonably acceptable to Landlord,
        not
        be cancelable unless 30 days' prior written notice shall have been given
        to
        Landlord, contain a hostile fire endorsement and a contractual liability
        endorsement and provide primary coverage to Landlord (any policy issued to
        Landlord providing duplicate or similar coverage shall be deemed excess over
        Tenant's policies). Such policies or certificates thereof shall be delivered
        to
        Landlord by Tenant upon commencement of the Lease Term and upon each renewal
        of
        said insurance.

      
        
          
          

        

        
          -3-

          
            

          

        

        
          
          

        

      

      The
        all
        risk property insurance obtained by Landlord and Tenant shall include a waiver
        of subrogation by the insurers and all rights based upon an assignment from
        its
        insured, against Landlord or Tenant, their officers, directors, employees,
        managers, agents, invitees and contractors, in connection with any loss or
        damage thereby insured against. Neither party nor its officers, directors,
        employees, managers, agents, invitees or contractors shall be liable to the
        other for loss or damage caused by any risk coverable by all risk property
        insurance, and each party waives any claims against the other party, and
        its
        officers, directors, employees, managers, agents, invitees and contractors
        for
        such loss or damage. The failure of a party to insure its property shall
        not
        void this waiver. Landlord and its agents, employees and contractors shall
        not
        be liable for, and Tenant hereby waives all claims against such parties for,
        business interruption and losses occasioned thereby sustained by Tenant or
        any
        person claiming through Tenant resulting from any accident or occurrence
        in or
        upon the Premises or the Project from any cause whatsoever, including without
        limitation, damage caused in whole or in part, directly or indirectly, by
        the
        negligence of Landlord or its agents, employees or contractors.

      

      10.   Landlord's
        Repairs.
        Landlord shall maintain, at its expense, the structural soundness of the
        roof,
        foundation, and exterior walls of the Building in good repair, reasonable
        wear
        and tear and uninsured losses and damages caused by Tenant, its agents and
        contractors excluded. The term "walls" as used in this Paragraph 10 shall
        not
        include windows, glass or plate glass, doors or overhead doors, special store
        fronts, dock bumpers, dock plates or levelers, or office entries. Tenant
        shall
        promptly give Landlord written notice of any repair required by Landlord
        pursuant to this Paragraph 10, after which Landlord shall have a reasonable
        opportunity to repair.

      

      11.   Tenant's
        Repairs.
        Landlord, at Tenant's expense as provided in Paragraph 6, shall maintain
        in good
        repair and condition the parking areas and other common areas of the Building,
        including, but not limited to driveways, alleys, landscape and grounds
        surrounding the Premises. Subject to Landlord's obligation in Paragraph 10
        and
        subject to Paragraphs 9 and 15, Tenant, at its expense, shall repair, replace
        and maintain in good condition all portions of the Premises and all areas,
        improvements and systems exclusively serving the Premises including, without
        limitation, dock and loading areas, truck doors, plumbing, water and sewer
        lines
        up to points of common connection, fire sprinklers and fire protection systems,
        entries, doors, ceilings, windows, interior walls, and the interior side
        of
        demising walls, and heating, ventilation and air conditioning systems. Such
        repair and replacements include capital expenditures and repairs whose benefit
        may extend beyond the Term. Heating, ventilation and air conditioning systems
        and other mechanical and building systems serving the Premises shall be
        maintained at Tenant's expense pursuant to maintenance service contracts
        entered
        into by Tenant or, at Landlord's election, by Landlord. The scope of services
        and contractors under such maintenance contracts shall be reasonably approved
        by
        Landlord. If Tenant fails to perform any repair or replacement for which
        it is
        responsible, Landlord may perform such work and be reimbursed by Tenant within
        10 days after demand therefor. Subject to Paragraphs 9 and 15, Tenant shall
        bear
        the full cost of any repair or replacement to any part of the Building or
        Project that results from damage caused by Tenant, its agents, contractors,
        or
        invitees and any repair that benefits only the Premises.

      

      12.   Tenant-Made
        Alterations and Trade Fixtures.
        Any
        alterations, additions, or improvements made by or on behalf of Tenant to
        the
        Premises ("Tenant-Made Alterations") shall be subject to Landlord's prior
        written consent. Tenant shall cause, at its expense, all Tenant-Made Alterations
        to comply with insurance requirements and with Legal Requirements and shall
        construct at its expense any alteration or modification required by Legal
        Requirements as a result of any Tenant-Made Alterations. All Tenant-Made
        Alterations shall be constructed in a good and workmanlike manner by contractors
        reasonably acceptable to Landlord and only good grades of materials shall
        be
        used. All plans and specifications for any Tenant-Made Alterations shall
        be
        submitted to Landlord for its approval. Landlord may monitor construction
        of the
        Tenant-Made Alterations. Tenant shall reimburse Landlord for its costs in
        reviewing plans and specifications and in monitoring construction. Landlord's
        right to review plans and specifications and to monitor construction shall
        be
        solely for its own benefit, and Landlord shall have no duty to see that such
        plans and specifications or construction comply with applicable laws, codes,
        rules and regulations. Tenant shall provide Landlord with the identities
        and
        mailing addresses of all persons performing work or supplying materials,
        prior
        to beginning such construction, and Landlord may post on and about the Premises
        notices of non-responsibility pursuant to applicable law. Tenant shall furnish
        security or make other arrangements satisfactory to Landlord to assure payment
        for the completion of all work free and clear of liens and shall provide
        certificates of insurance for worker's compensation and other coverage in
        amounts and from an insurance company satisfactory to Landlord protecting
        Landlord against liability for personal injury or property damage during
        construction. Upon completion of any Tenant-Made Alterations, Tenant shall
        deliver to Landlord sworn statements setting forth the names of all contractors
        and subcontractors who did work on the Tenant-Made Alterations and final
        lien
        waivers from all such contractors and subcontractors. Upon surrender of the
        Premises, all Tenant-Made Alterations and any leasehold improvements constructed
        by Landlord or Tenant shall remain on the Premises as Landlord's property,
        except to the extent Landlord requires removal at Tenant's expense of any
        such
        items or Landlord and Tenant have otherwise agreed in writing in connection
        with
        Landlord's consent to any Tenant-Made Alterations. Tenant shall repair any
        damage caused by such removal.

      

      Tenant,
        at its own cost and expense and without Landlord's prior approval, may erect
        such shelves, bins, machinery and trade fixtures (collectively "Trade Fixtures")
        in the ordinary course of its business provided that such items do not alter
        the
        basic character of the Premises, do not overload or damage the Premises,
        and may
        be removed without injury to the Premises, and the construction, erection,
        and
        installation thereof complies with all Legal Requirements and with Landlord's
        requirements set forth above. Tenant shall remove its Trade Fixtures and
        shall
        repair any damage caused by such removal.

      

      
        
          
          

        

        
          -4-

          
            

          

        

        
          
          

        

      

      13.   Signs.
        Tenant
        shall not make any changes to the exterior of the Premises, install any exterior
        lights, decorations, balloons, flags, pennants, banners, or painting, or
        erect
        or install any signs, windows or door lettering, placards, decorations, or
        advertising media of any type which can be viewed from the exterior of the
        Premises, without Landlord's prior written consent. Upon surrender or vacation
        of the Premises, Tenant shall have removed all signs and repair, paint, and/or
        replace the building facia surface to which its signs are attached. Tenant
        shall
        obtain all applicable governmental permits and approvals for sign and exterior
        treatments. All signs, decorations, advertising media, blinds, draperies
        and
        other window treatment or bars or other security installations visible from
        outside the Premises shall be subject to Landlord's approval and conform
        in all
        respects to Landlord's requirements.

      

      14.   Parking.
        Tenant
        shall be entitled to park in common with other tenants of the Project in
        those
        areas designated for nonreserved parking. Landlord may allocate parking spaces
        among Tenant and other tenants in the Project if Landlord determines that
        such
        parking facilities are becoming crowded. Landlord shall not be responsible
        for
        enforcing Tenant's parking rights against any third parties.

      

      15.   Restoration.
        If at
        any time during the Lease Term the Premises are damaged by a fire or other
        casualty, Landlord shall notify Tenant within 60 days after such damage as
        to
        the amount of time Landlord reasonably estimates it will take to restore
        the
        Premises. If the restoration time is estimated to exceed 6 months, either
        Landlord or Tenant may elect to terminate this Lease upon notice to the other
        party given no later than 30 days after Landlord's notice. If neither party
        elects to terminate this Lease or if Landlord estimates that restoration
        will
        take 6 months or less, then, subject to receipt of sufficient insurance
        proceeds, Landlord shall promptly restore the Premises excluding the
        improvements installed by Tenant or by Landlord and paid by Tenant, subject
        to
        delays arising from the collection of insurance proceeds or from Force Majeure
        events. Tenant at Tenant's expense shall promptly perform, subject to delays
        arising from the collection of insurance proceeds, or from Force Majeure
        events,
        all repairs or restoration not required to be done by Landlord and shall
        promptly re-enter the Premises and commence doing business in accordance
        with
        this Lease. Notwithstanding the foregoing, either party may terminate this
        Lease
        if the Premises are damaged during the last year of the Lease Term and Landlord
        reasonably estimates that it will take more than one month to repair such
        damage. Base Rent and Operating Expenses shall be abated for the period of
        repair and restoration in the proportion which the area of the Premises,
        if any,
        which is not usable by Tenant bears to the total area of the Premises. Such
        abatement shall be the sole remedy of Tenant, and except as provided herein,
        Tenant waives any right to terminate the Lease by reason of damage or casualty
        loss.

      

      16.   Condemnation.
        If any
        part of the Premises or the Project should be taken for any public or
        quasi-public use under governmental law, ordinance, or regulation, or by
        right
        of eminent domain, or by private purchase in lieu thereof (a "Taking" or
        "Taken"), and the Taking would prevent or materially interfere with Tenant's
        use
        of the Premises or in Landlord's judgment would materially interfere with
        or
        impair its ownership or operation of the Project, then upon written notice
        by
        Landlord this Lease shall terminate and Base Rent shall be apportioned as
        of
        said date. If part of the Premises shall be Taken, and this Lease is not
        terminated as provided above, the Base Rent payable hereunder during the
        unexpired Lease Term shall be reduced to such extent as may be fair and
        reasonable under the circumstances. In the event of any such Taking, Landlord
        shall be entitled to receive the entire price or award from any such Taking
        without any payment to Tenant, and Tenant hereby assigns to Landlord Tenant's
        interest, if any, in such award. Tenant shall have the right, to the extent
        that
        same shall not diminish Landlord's award, to make a separate claim against
        the
        condemning authority (but not Landlord) for such compensation as may be
        separately awarded or recoverable by Tenant for moving expenses and damage
        to
        Tenant's Trade Fixtures, if a separate award for such items is made to
        Tenant.

      

      17.   Assignment
        and Subletting.
        Without
        Landlord's prior written consent, which Landlord shall not unreasonably
        withhold, Tenant shall not assign this Lease or sublease the Premises or
        any
        part thereof or mortgage, pledge, or hypothecate its leasehold interest or
        grant
        any concession or license within the Premises and any attempt to do any of
        the
        foregoing shall be void and of no effect. For purposes of this paragraph,
        a
        transfer of the ownership interests resulting in a change of control of Tenant
        shall be deemed an assignment of this Lease unless such ownership interests
        are
        publicly traded or if the transfer is caused by an initial public offering.
        Notwithstanding the above, occupancy
        of all or part of the Premises by parent, subsidiary, or affiliated companies
        of
        Tenant or of Tenant’s parent or of Tenant’s subsidiary shall not be deemed an
        assignment or subletting provided that such parent, subsidiary or affiliated
        companies were not formed as a subterfuge to avoid the obligations of this
        Article 17. Furthermore, without limiting the generality of the foregoing,
        Tenant may assign the Lease at any time, or sublease all or part of the
        Premises, without receipt of Landlord’s consent, to any entity which is
        con-trolled directly or indirectly by Tenant, or which entity con-trols,
        directly or indirectly, Tenant (“Tenant Affiliate”), or which owns or is owned
        by the Tenant Affiliate, so long as such transaction was not entered into
        as a
        subterfuge to avoid the obligations and restrictions of the Lease.
        Tenant
        shall reimburse Landlord for all of Landlord's reasonable out-of-pocket expenses
        in connection with any assignment or sublease in an amount not to exceed
        $1,500.
        Upon Landlord's receipt of Tenant's written notice of a desire to assign
        or
        sublet the Premises, or any part thereof (other than to a Tenant Affiliate),
        Landlord may, by giving written notice to Tenant within 15 days after receipt
        of
        Tenant's notice, terminate this Lease with respect to the space described
        in
        Tenant's notice, as of the date specified in Tenant's notice for the
        commencement of the proposed assignment or sublease. If Landlord so terminates
        the Lease, Landlord may enter into a lease directly with the proposed sublessee
        or assignee. Tenant may withdraw its notice to sublease or assign by notifying
        Landlord within 10 days after Landlord has given Tenant notice of such
        termination, in which case the Lease shall not terminate but shall
        continue.

      
        
          
          

        

        
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      It
        shall
        be reasonable for the Landlord to withhold its consent to any assignment
        or
        sublease in any of the following instances: (i) an Event of Default has occurred
        and is continuing that would not be cured upon the proposed sublease or
        assignment; (ii) the assignee or sublessee does not have a net worth which
        is
        consistent with net worth of other tenant’s which Landlord is entering into
        leases with in the Project; (iii) the intended use of the Premises by the
        assignee or sublessee is not consistent with the use provision herein; (iv)
        the
        intended use of the Premises by the assignee or sublessee would materially
        increase the pedestrian or vehicular traffic to the Premises or the Project;
        (v)
        occupancy of the Premises by the assignee or sublessee would, in Landlord’s
        opinion, violate an agreement binding upon Landlord or the Project with regard
        to the identity of tenants, usage in the Project, or similar matters; (vi)
        the
        identity or business reputation of the assignee or sublessee will, in the
        good
        faith judgment of Landlord, tend to damage the goodwill or reputation of
        the
        Project; (vii) the assignment or sublet is to another tenant in the Project
        and
        is at rates which are below those charged by Landlord for comparable space
        in
        the Project and Landlord has space available in the Project to accommodate
        the
        tenant’s needs; (viii) in the case of a sublease, the subtenant has not
        acknowledged that the Lease controls over any inconsistent provision in the
        sublease; (ix) the proposed assignee or sublessee is a governmental agency;
        or
        (x) there is vacant space in the Project suitable for lease to the proposed
        sublessee or assignee. Tenant and Landlord acknowledge that each of the
        foregoing criteria are reasonable as of the date of execution of this Lease.
        The
        foregoing criteria shall not exclude any other reasonable basis for Landlord
        to
        refuse its consent to such assignment or sublease. Any approved assignment
        or
        sublease shall be expressly subject to the terms and conditions of this Lease.
        Tenant shall provide to Landlord all information concerning the assignee
        or
        sublessee as Landlord may request.

      

      Notwithstanding
        any assignment or subletting, Tenant shall at all times remain fully responsible
        and liable for the payment of the rent and for compliance with all of Tenant's
        other obligations under this Lease (regardless of whether Landlord's approval
        has been obtained for any such assignments or sublettings). In the event
        that
        the rent due and payable by a sublessee or assignee (or a combination of
        the
        rental payable under such sublease or assignment plus any bonus or other
        consideration therefor or incident thereto) exceeds the rental payable under
        this Lease, then Tenant shall be bound and obligated to pay Landlord as
        additional rent hereunder fifty (50%) percent of such excess rental and other
        excess consideration (“Profit”) within 10 days following receipt of each month’s
        Profit thereof by Tenant. Profit shall be further defined to take into
        consideration all of Tenant’s costs in any assignment of subletting including
        but not limited to real estate commissions, legal fees, marketing costs,
        any
        improvement allowance or other economic concession (planning allowance, moving
        expenses, etc.), paid by Tenant to sublessee or assignee. 

      

      If
        this
        Lease be assigned or if the Premises be subleased (whether in whole or in
        part)
        or in the event of the mortgage, pledge, or hypothecation of Tenant's leasehold
        interest or grant of any concession or license within the Premises or if
        the
        Premises be occupied in whole or in part by anyone other than Tenant, then
        upon
        a default by Tenant hereunder Landlord may collect rent from the assignee,
        sublessee, mortgagee, pledgee, party to whom the leasehold interest was
        hypothecated, concessionee or licensee or other occupant and, except to the
        extent set forth in the preceding paragraph, apply the amount collected to
        the
        next rent payable hereunder; and all such rentals collected by Tenant shall
        be
        held in trust for Landlord and immediately forwarded to Landlord. No such
        transaction or collection of rent or application thereof by Landlord, however,
        shall be deemed a waiver of these provisions or a release of Tenant from
        the
        further performance by Tenant of its covenants, duties, or obligations
        hereunder.

      

      18.   Indemnification. Except
        for the negligence of Landlord, its agents, employees or contractors, and
        to the
        extent permitted by law, Tenant agrees to indemnify, defend and hold harmless
        Landlord, and Landlord's agents, employees and contractors, from and against
        any
        and all losses, liabilities, damages, costs and expenses (including attorneys'
        fees) resulting from claims by third parties for injuries to any person and
        damage to or theft or misappropriation or loss of property occurring in or
        about
        the Project and arising from the use and occupancy of the Premises or from
        any
        activity, work, or thing done, permitted or suffered by Tenant in or about
        the
        Premises or due to any other act or omission of Tenant, its subtenants,
        assignees, invitees, employees, contractors and agents. The furnishing of
        insurance required hereunder shall not be deemed to limit Tenant's obligations
        under this Paragraph 18.

      

      19.   Inspection
        and Access.
        Landlord and its agents, representatives, and contractors may enter the Premises
        with prior notice at any reasonable time to inspect the Premises and to make
        such repairs as may be required or permitted pursuant to this Lease and for
        any
        other business purpose. Landlord and Landlord's representatives may enter
        the
        Premises during business hours for the purpose of showing the Premises to
        prospective purchasers and, during the last nine (9) months of the Lease
        Term,
        to prospective tenants. Landlord may erect a suitable sign on the Premises
        stating the Premises are available to let or that the Project is available
        for
        sale. Landlord may grant easements, make public dedications, designate common
        areas and create restrictions on or about the Premises, provided that no
        such
        easement, dedication, designation or restriction materially interferes with
        Tenant's use or occupancy of the Premises. At Landlord's request, Tenant
        shall
        execute such instruments as may be necessary for such easements, dedications
        or
        restrictions.

      

      20.   Quiet
        Enjoyment.
        If
        Tenant shall perform all of the covenants and agreements herein required
        to be
        performed by Tenant, Tenant shall, subject to the terms of this Lease, at
        all
        times during the Lease Term, have peaceful and quiet enjoyment of the Premises
        against any person claiming by, through or under Landlord.

      

      21.   Surrender.
        Upon
        termination of the Lease Term or earlier termination of Tenant's right of
        possession, Tenant shall surrender the Premises to Landlord in the same
        condition as received, broom clean, ordinary wear and tear and casualty loss
        and
        condemnation covered by Paragraphs 15 and 16 excepted. Any Trade Fixtures,
        Tenant-Made Alterations and property not so removed by Tenant as permitted
        or
        required herein shall be deemed abandoned and may be stored, removed, and
        disposed of by Landlord at Tenant's expense, and Tenant waives all claims
        against Landlord for any damages resulting from Landlord's retention and
        disposition of such property. All obligations of Tenant hereunder not fully
        performed as of the termination of the Lease Term shall survive the termination
        of the Lease Term, including without limitation, indemnity obligations, payment
        obligations with respect to Operating Expenses and obligations concerning
        the
        condition and repair of the Premises.

      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

      

      22.   Holding
        Over.
        If
        Tenant retains possession of the Premises after the termination of the Lease
        Term, unless otherwise agreed in writing, such possession shall be subject
        to
        immediate termination by Landlord at any time, and all of the other terms
        and
        provisions of this Lease (excluding any expansion or renewal option or other
        similar right or option) shall be applicable during such holdover period,
        except
        that Tenant shall pay Landlord from time to time, upon demand, as Base Rent
        for
        the holdover period, an amount equal to 150% the Base Rent in effect on the
        termination date, computed on a monthly basis for each month or part thereof
        during such holding over. All other payments shall continue under the terms
        of
        this Lease. In addition, Tenant shall be liable for all damages incurred
        by
        Landlord as a result of such holding over. No holding over by Tenant, whether
        with or without consent of Landlord, shall operate to extend this Lease except
        as otherwise expressly provided, and this Paragraph 22 shall not be construed
        as
        consent for Tenant to retain possession of the Premises. For
        purposes of this Paragraph 22, “possession of the Premises” shall continue
        until, among other things, Tenant has delivered all keys to the Premises
        to
        Landlord, Landlord has complete and total dominion and control over the
        Premises, and Tenant has completely fulfilled all obligations required of
        it
        upon termination of the Lease as set forth in this Lease, including, without
        limitation, those concerning the condition and repair of the
        Premises.

      

      23.   Events
        of Default.
        Each of
        the following events shall be an event of default ("Event of Default") by
        Tenant
        under this Lease:

      

      (i)   Tenant
        shall fail to pay any installment of Base Rent or any other payment required
        herein when due, and such failure shall continue for a period of 5 business
        days
        from the date such payment was due.

      

      (ii)   Tenant
        or
        any guarantor or surety of Tenant's obligations hereunder shall (A) make
        a
        general assignment for the benefit of creditors; (B) commence any case,
        proceeding or other action seeking to have an order for relief entered on
        its
        behalf as a debtor or to adjudicate it as bankrupt or insolvent, or seeking
        reorganization, arrangement, adjustment, liquidation, dissolution or composition
        of it or its debts or seeking appointment of a receiver, trustee, custodian
        or
        other similar official for it or for all or of any substantial part of its
        property (collectively a "proceeding for relief"); (C) become the subject
        of any
        proceeding for relief which is not dismissed within 60 days of its filing
        or
        entry; or (D) die or suffer a legal disability (if Tenant, guarantor, or
        surety
        is an individual) or be dissolved or otherwise fail to maintain its legal
        existence (if Tenant, guarantor or surety is a corporation, partnership or
        other
        entity).

      

      (iii)   Any
        insurance required to be maintained by Tenant pursuant to this Lease shall
        be
        cancelled or terminated or shall expire or shall be reduced or materially
        changed, except, in each case, as permitted in this Lease.

      

      (iv)   Tenant
        shall not occupy or shall vacate the Premises or shall fail to continuously
        operate its business at the Premises for the permitted use set forth herein,
        whether or not Tenant is in monetary or other default under this Lease. Tenant's
        vacating of the Premises shall not constitute an Event of Default if, prior
        to
        vacating the Premises, Tenant has made arrangements reasonably acceptable
        to
        Landlord to (a) insure that Tenant's insurance for the Premises will not
        be
        voided or cancelled with respect to the Premises as a result of such vacancy,
        (b) insure that the Premises are secured and not subject to vandalism, and
        (c)
        insure that the Premises will be properly maintained after such vacation.
        Tenant
        shall inspect the Premises at least once each month and report monthly in
        writing to Landlord on the condition of the Premises. 

      

      (v)   There
        shall occur any assignment, subleasing or other transfer of Tenant's interest
        in
        or with respect to this Lease except as otherwise permitted in this
        Lease.

      

      (vi)   Tenant
        shall fail to discharge any lien placed upon the Premises in violation of
        this
        Lease within 30 days after Tenant’s receipt of notice of any such lien or
        encumbrance is filed against the Premises.

      

      (vii)   Tenant
        shall fail to comply with any provision of this Lease other than those
        specifically referred to in this Paragraph 23, and except as otherwise expressly
        provided herein, such default shall continue for more than 30 days after
        Landlord shall have given Tenant written notice of such default.

      

      24.   Landlord's
        Remedies.
        Upon
        each occurrence of an Event of Default and so long as such Event of Default
        shall be continuing, Landlord may at any time thereafter at its election:
        terminate this Lease or Tenant's right of possession, (but Tenant shall remain
        liable as hereinafter provided) and/or pursue any other remedies at law or
        in
        equity. Upon the termination of this Lease or termination of Tenant's right
        of
        possession, it shall be lawful for Landlord, without formal demand or notice
        of
        any kind, to re-enter the Premises by summary dispossession proceedings or
        any
        other action or proceeding authorized by law and to remove Tenant and all
        persons and property therefrom. If Landlord re-enters the Premises, Landlord
        shall have the right to keep in place and use, or remove and store, all of
        the
        furniture, fixtures and equipment at the Premises.

      
        
          
          

        

        
          -7-

          
            

          

        

        
          
          

        

      

      Except
        as
        otherwise provided in the next paragraph, if Tenant breaches this Lease and
        abandons the Premises prior to the end of the term hereof, or if Tenant’s right
        to possession is terminated by Landlord because of an Event of Default by
        Tenant
        under this Lease, this Lease shall terminate. Upon such termination, Landlord
        may recover from Tenant the following, as provided in Section 1951.2 of the
        Civil Code of California: (i) the worth at the time of award of the unpaid
        Base
        Rent and other charges under this Lease that had been earned at the time
        of
        termination; (ii) the worth at the time of award of the amount by which the
        reasonable value of the unpaid Base Rent and other charges under this Lease
        which would have been earned after termination until the time of award exceeds
        the amount of such rental loss that Tenant proves could have been reasonably
        avoided; (iii) the worth at the time of the award by which the reasonable
        value
        of the unpaid Base Rent and other charges under this Lease for the balance
        of
        the term of this Lease after the time of award exceeds the amount of such
        rental
        loss that Tenant proves could have been reasonably avoided; and (iv) any
        other
        amount necessary to compensate Landlord for all the detriment proximately
        caused
        by Tenant’s failure to perform its obligations under this Lease or that in the
        ordinary course of things would be likely to result therefrom. As used herein,
        the following terms are defined: (a) the “worth at the time of award” of the
        amounts referred to in Sections (i) and (ii) is computed by allowing interest
        at
        the lesser of 18 percent per annum or the maximum lawful rate. The “worth at the
        time of award” of the amount referred to in Section (iii) is computed by
        discounting such amount at the discount rate of the Federal Reserve Bank
        of San
        Francisco at the time of award plus one percent; (b) the “time of award” as used
        in clauses (i), (ii), and (iii) above is the date on which judgment is entered
        by a court of competent jurisdiction; (c) The “reasonable value” of the amount
        referred to in clause (ii) above is computed by determining the mathematical
        product of (1) the “reasonable annual rental value” (as defined herein) and (2)
        the number of years, including fractional parts thereof, between the date
        of
        termination and the time of award. The “reasonable value” of the amount referred
        to in clause (iii) is computed by determining the mathematical product of
        (1)
        the annual Base Rent and other charges under this Lease and (2) the number
        of
        years including fractional parts thereof remaining in the balance of the
        term of
        this Lease after the time of award.

      

      Even
        though Tenant has breached this Lease and abandoned the Premises, this Lease
        shall continue in effect for so long as Landlord does not terminate Tenant’s
        right to possession, and Landlord may enforce all its rights and remedies
        under
        this Lease, including the right to recover rent as it becomes due. This remedy
        is intended to be the remedy described in California Civil Code Section 1951.4
        and the following provision from such Civil Code Section is hereby repeated:
        “The Lessor has the remedy described in California Civil Code Section 1951.4
        (lessor may continue lease in effect after lessee’s breach and abandonment and
        recover rent as it becomes due, if lessee has right to sublet or assign,
        subject
        only to reasonable limitations).” Any such payments due Landlord shall be made
        upon demand therefor from time to time and Tenant agrees that Landlord may
        file
        suit to recover any sums falling due from time to time. Notwithstanding any
        such
        reletting without termination, Landlord may at any time thereafter elect
        in
        writing to terminate this Lease for such previous breach.

      

      Exercise
        by Landlord of any one or more remedies hereunder granted or otherwise available
        shall not be deemed to be an acceptance of surrender of the Premises and/or
        a
        termination of this Lease by Landlord, whether by agreement or by operation
        of
        law, it being understood that such surrender and/or termination can be effected
        only by the written agreement of Landlord and Tenant. Any law, usage, or
        custom
        to the contrary notwithstanding, Landlord shall have the right at all times
        to
        enforce the provisions of this Lease in strict accordance with the terms
        hereof;
        and the failure of Landlord at any time to enforce its rights under this
        Lease
        strictly in accordance with same shall not be construed as having created
        a
        custom in any way or manner contrary to the specific terms, provisions, and
        covenants of this Lease or as having modified the same. Tenant and Landlord
        further agree that forbearance or waiver by Landlord to enforce its rights
        pursuant to this Lease or at law or in equity, shall not be a waiver of
        Landlord's right to enforce one or more of its rights in connection with
        any
        subsequent default. A receipt by Landlord of rent or other payment with
        knowledge of the breach of any covenant hereof shall not be deemed a waiver
        of
        such breach, and no waiver by Landlord of any provision of this Lease shall
        be
        deemed to have been made unless expressed in writing and signed by Landlord.
        To
        the greatest extent permitted by law, Tenant waives the service of notice
        of
        Landlord's intention to re-enter as provided for in any statute, or to institute
        legal proceedings to that end, and also waives all right of redemption in
        case
        Tenant shall be dispossessed by a judgment or by warrant of any court or
        judge.
        The terms "enter," "re-enter," "entry" or "re-entry," as used in this Lease,
        are
        not restricted to their technical legal meanings. Any reletting of the Premises
        shall be on such terms and conditions as Landlord in its sole discretion
        may
        determine (including without limitation a term different than the remaining
        Lease Term, rental concessions, alterations and repair of the Premises, lease
        of
        less than the entire Premises to any tenant and leasing any or all other
        portions of the Project before reletting the Premises). Landlord shall not
        be
        liable, nor shall Tenant's obligations hereunder be diminished because of,
        Landlord's failure to relet the Premises or collect rent due in respect of
        such
        reletting.

      

      25.   Tenant's
        Remedies/Limitation of Liability.
        Landlord shall not be in default hereunder unless Landlord fails to perform
        any
        of its obligations hereunder within 30 days after written notice from Tenant
        specifying such failure (unless such performance will, due to the nature
        of the
        obligation, require a period of time in excess of 30 days, then after such
        period of time as is reasonably necessary). All obligations of Landlord
        hereunder shall be construed as covenants, not conditions; and, except as
        may be
        otherwise expressly provided in this Lease, Tenant may not terminate this
        Lease
        for breach of Landlord's obligations hereunder. All obligations of Landlord
        under this Lease will be binding upon Landlord only during the period of
        its
        ownership of the Premises and not thereafter. The term "Landlord" in this
        Lease
        shall mean only the owner, for the time being of the Premises, and in the
        event
        of the transfer by such owner of its interest in the Premises, such owner
        shall
        thereupon be released and discharged from all obligations of Landlord thereafter
        accruing, but such obligations shall be binding during the Lease Term upon
        each
        new owner for the duration of such owner's ownership. Any liability of Landlord
        under this Lease shall be limited solely to its interest in the Project,
        and in
        no event shall any personal liability be asserted against Landlord in connection
        with this Lease nor shall any recourse be had to any other property or assets
        of
        Landlord.

      

      26.   Waiver
        of Jury Trial.
        TENANT
        AND LANDLORD WAIVE ANY RIGHT TO TRIAL BY JURY OR TO HAVE A JURY PARTICIPATE
        IN
        RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE,
        BETWEEN
        LANDLORD AND TENANT ARISING OUT OF THIS LEASE OR ANY OTHER INSTRUMENT, DOCUMENT,
        OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS
        RELATED HERETO.

      
        
          
          

        

        
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      27.   Subordination.
        This
        Lease and Tenant's interest and rights hereunder are and shall be subject
        and
        subordinate at all times to the lien of any mortgage, now existing or hereafter
        created on or against the Project or the Premises, and all amendments,
        restatements, renewals, modifications, consolidations, refinancing, assignments
        and extensions thereof, without the necessity of any further instrument or
        act
        on the part of Tenant. Tenant agrees, at the election of the holder of any
        such
        mortgage, to attorn to any such holder. Tenant agrees upon demand to execute,
        acknowledge and deliver such instruments, confirming such subordination and
        such
        instruments of attornment as shall be requested by any such holder.
        Notwithstanding the foregoing, any such holder may at any time subordinate
        its
        mortgage to this Lease, without Tenant's consent, by notice in writing to
        Tenant, and thereupon this Lease shall be deemed prior to such mortgage without
        regard to their respective dates of execution, delivery or recording and
        in that
        event such holder shall have the same rights with respect to this Lease as
        though this Lease had been executed prior to the execution, delivery and
        recording of such mortgage and had been assigned to such holder. The term
        "mortgage" whenever used in this Lease shall be deemed to include deeds of
        trust, security assignments and any other encumbrances, and any reference
        to the
        "holder" of a mortgage shall be deemed to include the beneficiary under a
        deed
        of trust.

      

      28.   Mechanic's
        Liens.
        Tenant
        has no express or implied authority to create or place any lien or encumbrance
        of any kind upon, or in any manner to bind the interest of Landlord or Tenant
        in, the Premises or to charge the rentals payable hereunder for any claim
        in
        favor of any person dealing with Tenant, including those who may furnish
        materials or perform labor for any construction or repairs. Tenant covenants
        and
        agrees that it will pay or cause to be paid all sums legally due and payable
        by
        it on account of any labor performed or materials furnished in connection
        with
        any work performed on the Premises and that it will save and hold Landlord
        harmless from all loss, cost or expense based on or arising out of asserted
        claims or liens against the leasehold estate or against the interest of Landlord
        in the Premises or under this Lease. Tenant shall give Landlord immediate
        written notice of the placing of any lien or encumbrance against the Premises
        and cause such lien or encumbrance to be discharged within 30 days of the
        filing
        or recording thereof; provided, however, Tenant may contest such liens or
        encumbrances as long as such contest prevents foreclosure of the lien or
        encumbrance and Tenant causes such lien or encumbrance to be bonded or insured
        over in a manner satisfactory to Landlord within such 30 day
        period.

      

      29.   Estoppel
        Certificates.
        Tenant
        agrees, from time to time, within 10 days after request of Landlord, to execute
        and deliver to Landlord, or Landlord's designee, any estoppel certificate
        requested by Landlord, stating that this Lease is in full force and effect,
        the
        date to which rent has been paid, that Landlord is not in default hereunder
        (or
        specifying in detail the nature of Landlord's default), the termination date
        of
        this Lease and such other matters pertaining to this Lease as may be requested
        by Landlord. Tenant's obligation to furnish each estoppel certificate in
        a
        timely fashion is a material inducement for Landlord's execution of this
        Lease.
        No cure or grace period provided in this Lease shall apply to Tenant's
        obligations to timely deliver an estoppel certificate. 

      

      30.   Environmental
        Requirements.
        Except
        for Hazardous Material contained in products used by Tenant in de minimis
        quantities for ordinary cleaning and office purposes, Tenant shall not permit
        or
        cause any party to bring any Hazardous Material upon the Premises or transport,
        store, use, generate, manufacture or release any Hazardous Material in or
        about
        the Premises without Landlord's prior written consent. Tenant, at its sole
        cost
        and expense, shall operate its business in the Premises in strict compliance
        with all Environmental Requirements and shall remediate in a manner satisfactory
        to Landlord any Hazardous Materials released on or from the Project by Tenant,
        its agents, employees, contractors, subtenants or invitees. Tenant shall
        complete and certify to disclosure statements as requested by Landlord from
        time
        to time relating to Tenant's transportation, storage, use, generation,
        manufacture or release of Hazardous Materials on the Premises. The term
        "Environmental Requirements" means all applicable present and future statutes,
        regulations, ordinances, rules, codes, judgments, orders or other similar
        enactments of any governmental authority or agency regulating or relating
        to
        health, safety, or environmental conditions on, under, or about the Premises
        or
        the environment, including without limitation, the following: the Comprehensive
        Environmental Response, Compensation and Liability Act; the Resource
        Conservation and Recovery Act; and all state and local counterparts thereto,
        and
        any regulations or policies promulgated or issued thereunder. The term
        "Hazardous Materials" means and includes any substance, material, waste,
        pollutant, or contaminant listed or defined as hazardous or toxic, under
        any
        Environmental Requirements, asbestos and petroleum, including crude oil or
        any
        fraction thereof, natural gas liquids, liquified natural gas, or synthetic
        gas
        usable for fuel (or mixtures of natural gas and such synthetic gas). As defined
        in Environmental Requirements, Tenant is and shall be deemed to be the
        "operator" of Tenant's "facility" and the "owner" of all Hazardous Materials
        brought on the Premises by Tenant, its agents, employees, contractors or
        invitees, and the wastes, by-products, or residues generated, resulting,
        or
        produced therefrom.

      

      Tenant
        shall indemnify, defend, and hold Landlord harmless from and against any
        and all
        losses (including, without limitation, diminution in value of the Premises
        or
        the Project and loss of rental income from the Project), claims, demands,
        actions, suits, damages (including, without limitation, punitive damages),
        expenses (including, without limitation, remediation, removal, repair,
        corrective action, or cleanup expenses), and costs (including, without
        limitation, actual attorneys' fees, consultant fees or expert fees and
        including, without limitation, removal or management of any asbestos brought
        into the property or disturbed in breach of the requirements of this Paragraph
        30, regardless of whether such removal or management is required by law)
        which
        are brought or recoverable against, or suffered or incurred by Landlord as
        a
        result of any release of Hazardous Materials for which Tenant is obligated
        to
        remediate as provided above or any other breach of the requirements under
        this
        Paragraph 30 by Tenant, its agents, employees, contractors, subtenants,
        assignees or invitees, regardless of whether Tenant had knowledge of such
        noncompliance. The obligations of Tenant under this Paragraph 30 shall survive
        any termination of this Lease.

      
        
          
          

        

        
          -9-

          
            

          

        

        
          
          

        

      

      Landlord
        shall have access to, and a right to perform inspections and tests of, the
        Premises to determine Tenant's compliance with Environmental Requirements,
        its
        obligations under this Paragraph 30, or the environmental condition of the
        Premises. Access shall be granted to Landlord upon Landlord's prior notice
        to
        Tenant and at such times so as to minimize, so far as may be reasonable under
        the circumstances, any disturbance to Tenant's operations. Such inspections
        and
        tests shall be conducted at Landlord's expense, unless such inspections or
        tests
        reveal that Tenant has not complied with any Environmental Requirement, in
        which
        case Tenant shall reimburse Landlord for the reasonable cost of such inspection
        and tests. Landlord's receipt of or satisfaction with any environmental
        assessment in no way waives any rights that Landlord holds against
        Tenant.

      

      31.   Rules
        and Regulations.
        Tenant
        shall, at all times during the Lease Term and any extension thereof, comply
        with
        all reasonable rules and regulations at any time or from time to time
        established by Landlord covering use of the Premises and the Project. The
        current rules and regulations are attached hereto. In the event of any conflict
        between said rules and regulations and other provisions of this Lease, the
        other
        terms and provisions of this Lease shall control. Landlord shall not have
        any
        liability or obligation for the breach of any rules or regulations by other
        tenants in the Project.

      

      32.   Security
        Service.
        Tenant
        acknowledges and agrees that, while Landlord may patrol the Project, Landlord
        is
        not providing any security services with respect to the Premises and that
        Landlord shall not be liable to Tenant for, and Tenant waives any claim against
        Landlord with respect to, any loss by theft or any other damage suffered
        or
        incurred by Tenant in connection with any unauthorized entry into the Premises
        or any other breach of security with respect to the Premises.

      

      33.   Force
        Majeure.
        Landlord shall not be held responsible for delays in the performance of its
        obligations hereunder when caused by strikes, lockouts, labor disputes, acts
        of
        God, inability to obtain labor or materials or reasonable substitutes therefor,
        governmental restrictions, governmental regulations, governmental controls,
        delay in issuance of permits, enemy or hostile governmental action, civil
        commotion, fire or other casualty, and other causes beyond the reasonable
        control of Landlord ("Force Majeure").

      

      34.   Entire
        Agreement.
        This
        Lease constitutes the complete agreement of Landlord and Tenant with respect
        to
        the subject matter hereof. No representations, inducements, promises or
        agreements, oral or written, have been made by Landlord or Tenant, or anyone
        acting on behalf of Landlord or Tenant, which are not contained herein, and
        any
        prior agreements, promises, negotiations, or representations are superseded
        by
        this Lease. This Lease may not be amended except by an instrument in writing
        signed by both parties hereto.

      

      35.   Severability.
        If any
        clause or provision of this Lease is illegal, invalid or unenforceable under
        present or future laws, then and in that event, it is the intention of the
        parties hereto that the remainder of this Lease shall not be affected thereby.
        It is also the intention of the parties to this Lease that in lieu of each
        clause or provision of this Lease that is illegal, invalid or unenforceable,
        there be added, as a part of this Lease, a clause or provision as similar
        in
        terms to such illegal, invalid or unenforceable clause or provision as may
        be
        possible and be legal, valid and enforceable.

      

      36.   Brokers.
        Tenant
        represents and warrants that it has dealt with no broker, agent or other
        person
        in connection with this transaction and that no broker, agent or other person
        brought about this transaction, other than the broker, if any, set forth
        on the
        first page of this Lease, and Tenant agrees to indemnify and hold Landlord
        harmless from and against any claims by any other broker, agent or other
        person
        claiming a commission or other form of compensation by virtue of having dealt
        with Tenant with regard to this leasing transaction.

      

      37.   Miscellaneous.   (a)   Any
        payments or charges due from Tenant to Landlord hereunder shall be considered
        rent for all purposes of this Lease.

      

      (b)   If
        and
        when included within the term "Tenant," as used in this instrument, there
        is
        more than one person, firm or corporation, each shall be jointly and severally
        liable for the obligations of Tenant.

      

      (c)   All
        notices required or permitted to be given under this Lease shall be in writing
        and shall be sent by registered or certified mail, return receipt requested,
        or
        by a reputable national overnight courier service, postage prepaid, or by
        hand
        delivery addressed to the parties at their addresses below, and with a copy
        sent
        to Landlord at 4545
        Airport Way, Denver, Colorado 80239.
        Either
        party may by notice given aforesaid change its address for all subsequent
        notices. Except where otherwise expressly provided to the contrary, notice
        shall
        be deemed given upon delivery.

      

      (d)   Except
        as
        otherwise expressly provided in this Lease or as otherwise required by law,
        Landlord retains the absolute right to withhold any consent or
        approval.

      

      (e)   At
        Landlord's request from time to time Tenant shall furnish Landlord with true
        and
        complete copies of its most recent annual and quarterly financial statements
        prepared by Tenant or Tenant's accountants and any other financial information
        or summaries that Tenant typically provides to its lenders or
        shareholders.

      

      (f)   Unless
        required by law, neither this Lease nor a memorandum of lease shall be filed
        by
        or on behalf of Tenant in any public record. Landlord may prepare and file,
        and
        upon request by Landlord Tenant will execute, a memorandum of
        lease.

      

      (g)   The
        normal rule of construction to the effect that any ambiguities are to be
        resolved against the drafting party shall not be employed in the interpretation
        of this Lease or any exhibits or amendments hereto.

      

      (h)   The
        submission by Landlord to Tenant of this Lease shall have no binding force
        or
        effect, shall not constitute an option for the leasing of the Premises, nor
        confer any right or impose any obligations upon either party until execution
        of
        this Lease by both parties.

      
        
          
          

        

        
          -10-

          
            

          

        

        
          
          

        

      

      (i)   Words
        of
        any gender used in this Lease shall be held and construed to include any
        other
        gender, and words in the singular number shall be held to include the plural,
        unless the context otherwise requires. The captions inserted in this Lease
        are
        for convenience only and in no way define, limit or otherwise describe the
        scope
        or intent of this Lease, or any provision hereof, or in any way affect the
        interpretation of this Lease.

      

      (j)   Any
        amount not paid by Tenant within 5 days after its due date in accordance
        with
        the terms of this Lease shall bear interest from such due date until paid
        in
        full at the lesser of the highest rate permitted by applicable law or 15
        percent
        per year. It is expressly the intent of Landlord and Tenant at all times
        to
        comply with applicable law governing the maximum rate or amount of any interest
        payable on or in connection with this Lease.  If applicable law is ever
        judicially interpreted so as to render usurious any interest called for under
        this Lease, or contracted for, charged, taken, reserved, or received with
        respect to this Lease, then it is Landlord's and Tenant's express intent
        that
        all excess amounts theretofore collected by Landlord be credited on the
        applicable obligation (or, if the obligation has been or would thereby be
        paid
        in full, refunded to Tenant), and the provisions of this Lease immediately
        shall
        be deemed reformed and the amounts thereafter collectible hereunder reduced,
        without the necessity of the execution of any new document, so as to comply
        with
        the applicable law, but so as to permit the recovery of the fullest amount
        otherwise called for hereunder.

      

      (k)   Construction
        and interpretation of this Lease shall be governed by the laws of the state
        in
        which the Project is located, excluding any principles of conflicts of
        laws.

      

      (l)   Time
        is
        of the essence as to the performance of Tenant's obligations under this
        Lease.

      

      (m)   All
        exhibits and addenda attached hereto are hereby incorporated into this Lease
        and
        made a part hereof. In the event of any conflict between such exhibits or
        addenda and the terms of this Lease, such exhibits or addenda shall
        control.

      

      (n)   In
        the
        event either party hereto initiates litigation to enforce the terms and
        provisions of this Lease, the non-prevailing party in such action shall
        reimburse the prevailing party for its reasonable attorney's fees, filing
        fees,
        and court costs.

       

      38.   Landlord's
        Lien/Security Interest.
        Tenant
        hereby grants Landlord a security interest, and this Lease constitutes a
        security agreement, within the meaning of and pursuant to the Uniform Commercial
        Code of the state in which the Premises are situated as to all of Tenant's
        property situated in, or upon, or used in connection with the Premises (except
        merchandise sold in the ordinary course of business) as security for all
        of
        Tenant's obligations hereunder, including, without limitation, the obligation
        to
        pay rent. Such personalty thus encumbered includes specifically all trade
        and
        other fixtures for the purpose of this Paragraph and inventory, equipment,
        contract rights, accounts receivable and the proceeds thereof. In order to
        perfect such security interest, Tenant shall execute such financing statements
        and file the same at Tenant's expense at the state and county Uniform Commercial
        Code filing offices as often as Landlord in its discretion shall require;
        and
        Tenant hereby irrevocably appoints Landlord its agent for the purpose of
        executing and filing such financing statements on Tenant's behalf as Landlord
        shall deem necessary.

      

      39.   Limitation
        of Liability of Trustees, Shareholders, and Officers of
        ProLogis.
        Any
        obligation or liability whatsoever of ProLogis, a Maryland real estate
        investment trust, which may arise at any time under this Lease or any obligation
        or liability which may be incurred by it pursuant to any other instrument,
        transaction, or undertaking contemplated hereby shall not be personally binding
        upon, nor shall resort for the enforcement thereof be had to the property
        of,
        its trustees, directors, shareholders, officers, employees or agents, regardless
        of whether such obligation or liability is in the nature of contract, tort,
        or
        otherwise.

      

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

      

       

      
        	
                TENANT:

              	 	
                LANDLORD:

              	 	 
	 	 	 	 	 	 	 	 
	
                ViewSonic
                  Corporation, a Delaware corporation

              	 	
                CATELLUS
                  OPERATING LIMITED PARTNERSHIP, a Delaware limited
                  partnership

              
	 	 	 	 	 	 	 	 
	 	 	 	 	 	
                By:

              	 	
                Palmtree
                  Acquisition Corporation, a Delaware corporation, its general partner
                  successor in interest to Catellus Development
                  Corporation

              
	
                 

              	 	 	
                 

              	
                 

              	
                 

              	
                 

              	 
	
                By:

              	
                /s/
                  James A.
                  Morlan                      
                  

              	 	
                By:

              	 	
                /s/
                  W. Scott
                  Lamson                      
                  

              
	
                Name:

              	
                James
                  A. Morlan

              	 	
                Name:

              	 	
                W.
                  Scott Lamson

              
	
                Title:

              	
                Chief
                  Financial Officer

              	 	
                Title:

              	 	
                Senior
                  Vice President

              
	 	 	 	 	 
	
                Address:

              	 	
                Address:

              	 	 
	 	 	 
	
                381
                  S. Brea Canyon Road

              	 	
                47775
                  Fremont Boulevard

              
	
                           
                  

              	 	 	
                            
                  

              	 	 	 	 
	
                City
                  of Industry,
                  CA 91789 

              	 	
                Fremont
                  ,CA 94538 

              

      

      
        
          
          

        

        
          -11-

          
            

          

        

        
          
          

        

      

      Rules
        and Regulations

      
 

      
        	
                1.

              	
                The
                  sidewalk, entries, and driveways of the Project shall not be obstructed
                  by
                  Tenant, or its agents, or used by them for any purpose other than
                  ingress
                  and egress to and from the
                  Premises.

              

      

      

      
        	
                2.

              	
                Tenant
                  shall not place any objects, including antennas, outdoor furniture,
                  etc.,
                  in the parking areas, landscaped areas or other areas outside of
                  its
                  Premises, or on the roof of the
                  Project.

              

      

      

      
        	
                3.

              	
                Except
                  for seeing-eye dogs and small pet birds contained in cages, no
                  animals
                  shall be allowed in the offices, halls, or corridors in the
                  Project.

              

      

      

      
        	
                4.

              	
                Tenant
                  shall not disturb the occupants of the Project or adjoining buildings
                  by
                  the use of any radio or musical instrument or by the making of
                  loud or
                  improper noises.

              

      

      

      
        	
                5.

              	
                If
                  Tenant desires telegraphic, telephonic or other electric connections
                  in
                  the Premises, Landlord or its agent will direct the electrician
                  as to
                  where and how the wires may be introduced; and, without such direction,
                  no
                  boring or cutting of wires will be permitted. Any such installation
                  or
                  connection shall be made at Tenant's
                  expense.

              

      

      

      
        	
                6.

              	
                Tenant
                  shall not install or operate any steam or gas engine or boiler,
                  or other
                  mechanical apparatus in the Premises, except as specifically approved
                  in
                  the Lease. The use of oil, gas or inflammable liquids for heating,
                  lighting or any other purpose is expressly prohibited. Explosives
                  or other
                  articles deemed extra hazardous shall not be brought into the Project.
                  Landlord acknowledges and approves Tenant’s current use of a bailer,
                  diesel generator and propane tank outside the building and reserves
                  the
                  right for Tenant to remove, at Tenant’s sole cost and expense, such
                  equipment upon termination of lease or vacating of premises, whichever
                  is
                  first.

              

      

      

      
        	
                7.

              	
                Parking
                  any type of recreational vehicles is specifically prohibited on
                  or about
                  the Project. Further, parking any type of trucks, trailers or other
                  vehicles in the Premises is specifically prohibited. Except for
                  the
                  overnight parking of operative vehicles, no vehicle of any type
                  shall be
                  stored in the parking areas at any time. In the event that a vehicle
                  is
                  disabled, it shall be removed within 48 hours. There shall be no
                  "For
                  Sale" or other advertising signs on or about any parked vehicle.
                  All
                  vehicles shall be parked in the designated parking areas in conformity
                  with all signs and other markings. All parking will be open parking,
                  and
                  no reserved parking, numbering or lettering of individual spaces
                  will be
                  permitted except as specified by
                  Landlord.

              

      

      

      
        	
                8.

              	
                Tenant
                  shall maintain the Premises free from rodents, insects and other
                  pests.

              

      

      

      
        	
                9.

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

              

      

      

      
        	
                10.

              	
                Tenant
                  shall not cause any unnecessary labor by reason of Tenant's carelessness
                  or indifference in the preservation of good order and cleanliness.
                  Landlord shall not be responsible to Tenant for any loss of property
                  on
                  the Premises, however occurring, or for any damage done to the
                  effects of
                  Tenant by the janitors or any other employee or
                  person.

              

      

      

      
        	
                11.

              	
                Tenant
                  shall give Landlord prompt notice of any defects in the water,
                  lawn
                  sprinkler, sewage, gas pipes, electrical lights and fixtures, heating
                  apparatus, or any other service equipment affecting the
                  Premises.

              

      

      

      
        	
                12.

              	
                Tenant
                  shall not permit storage outside the Premises, including without
                  limitation, outside storage of trucks and other vehicles, or dumping
                  of
                  waste or refuse or permit any harmful materials to be placed in
                  any
                  drainage system or sanitary system in or about the
                  Premises.

              

      

      

      
        	
                13.

              	
                All
                  moveable trash receptacles provided by the trash disposal firm
                  for the
                  Premises must be kept in the trash enclosure areas, if any, provided
                  for
                  that purpose.

              

      

      

      
        	
                14.

              	
                No
                  auction, public or private, will be permitted on the Premises or
                  the
                  Project.

              

      

      

      
        	
                15.

              	
                No
                  awnings shall be placed over the windows in the Premises except
                  with the
                  prior written consent of Landlord.

              

      

      

      
        	
                16.

              	
                The
                  Premises shall not be used for lodging, sleeping or cooking or
                  for any
                  immoral or illegal purposes or for any purpose other than that
                  specified
                  in the Lease. No gaming devices shall be operated in the
                  Premises.

              

      

      

      
        	
                17.

              	
                Tenant
                  shall ascertain from Landlord the maximum amount of electrical
                  current
                  which can safely be used in the Premises, taking into account the
                  capacity
                  of the electrical wiring in the Project and the Premises and the
                  needs of
                  other tenants, and shall not use more than such safe capacity.
                  Landlord's
                  consent to the installation of electric equipment shall not relieve
                  Tenant
                  from the obligation not to use more electricity than such safe
                  capacity.

              

      

      
        
          
          

        

        
          -12-

          
            

          

        

        
          
          

        

      

      
        	18.	
                Tenant
                  assumes full responsibility for protecting the Premises from theft,
                  robbery and pilferage.

              

      

      

      
        	
                19.

              	
                Tenant
                  shall not install or operate on the Premises any machinery or mechanical
                  devices of a nature not directly related to Tenant's ordinary use
                  of the
                  Premises and shall keep all such machinery free of vibration, noise
                  and
                  air waves which may be transmitted beyond the
                  Premises.

              

      

      
        
          
          

        

        
          -13-

          
            

          

        

        
          
          

        

      

      ADDENDUM
        1

      

      BASE
        RENT ADJUSTMENTS

      

      ATTACHED
        TO AND A PART OF THE LEASE AGREEMENT

      DATED
        JANUARY 19, 2007, BETWEEN

      

      CATELLUS
        OPERATING LIMITED PARTNERSHIP

      and

      ViewSonic
        Corporation, a Delaware corporation

      

      

      Base
        Rent
        shall equal the following amounts for the respective periods set forth
        below:

      

      
        	
                Period

              	 	
                Monthly
                  Base Rent

              
	
                July
                  1, 2007

              	
                to

              	
                August
                  31, 2007

              	 	
                $0.00*

              
	
                September
                  1, 2007

              	
                to

              	
                September
                  30, 2007

              	 	
                $29,832.00*

              
	
                October
                  1, 2007

              	
                to

              	
                June
                  30, 2009

              	 	
                $127,416.00

              
	
                July
                  1, 2009

              	
                to

              	
                June
                  30, 2011

              	 	
                $136,358.00

              
	
                July
                  1, 2011

              	
                to

              	
                June
                  30, 2013

              	 	
                $145,299.00

              
	
                July
                  1, 2013

              	
                to

              	
                July
                  31, 2014

              	 	
                $154,241.00

              

      

      

      *
        Tenant
        shall be responsible for the payment of Operating Expenses for these
        periods.

      
        
          
          

        

        
          -14-

          
            

          

        

        
          
          

        

      

      ADDENDUM
        2

      

      CAP
        ON CONTROLLABLE OPERATING EXPENSES

      

      ATTACHED
        TO AND A PART OF THE LEASE AGREEMENT

      DATED
        JANUARY 19, 2007, BETWEEN

      

      CATELLUS
        OPERATING LIMITED PARTNERSHIP

      and

      ViewSonic
        Corporation, a Delaware corporation

      

      

      Tenant
        shall not be obligated to pay for Controllable Operating Expenses in any
        year to
        the extent they have increased by more than Five
        percent
        (5.000%)
        per
        annum, compounded annually on a cumulative basis from the first calendar
        year
        during the Lease term. For purposes of this Addendum, Controllable Operating
        Expenses shall mean the following Operating Expenses: 

      

      Common
        Area Maintenance Fees (CAM) and Property Management Fees 

      

      Taxes,
        insurance premiums and utility costs shall not be deemed Controllable Operating
        Expenses. Controllable Operating Expenses shall be determined on an aggregate
        basis and not on an individual basis, and the cap on Controllable Operating
        Expenses shall be determined on Operating Expenses as they have been adjusted
        for vacancy or usage pursuant to the terms of the Lease.

      
        
          
          

        

        
          -15-

          
            

          

        

        
          
          

        

      

      ADDENDUM
        3

      

      RENEWAL
        OPTION

      (BASEBALL
        ARBITRATION)

      

      ATTACHED
        TO AND A PART OF THE LEASE AGREEMENT

      DATED
        JANUARY 19, 2007, BETWEEN

      

      CATELLUS
        OPERATING LIMITED PARTNERSHIP

      and

      ViewSonic
        Corporation, a Delaware corporation

      

      

      (a)   Provided
        that as of the time of the giving of the Extension Notice and the Commencement
        Date of the Extension Term (as such terms are defined below), (x) Tenant
        is the
        Tenant originally named herein, (y) Tenant actually occupies all of the
        Premises initially demised under this Lease and any space added to the Premises,
        and (z) no Event of Default exists, or would exist but for the passage of
        time or the giving of notice, or both; then Tenant shall have the right to
        extend the Lease Term for an additional term of five (5)
        years
        (such additional term is hereinafter called the "Extension Term") commencing
        on
        the day following the expiration of the Lease Term (hereinafter referred
        to as
        the "Commencement Date of the Extension Term"). Tenant must give Landlord
        notice
        (hereinafter called the "Extension Notice") of its election to extend the
        term
        of the Lease Term at least nine (9) months, but not more than twelve (12)
        months, prior to the scheduled expiration date of the Lease Term.

      

      (b)   The
        Base
        Rent payable by Tenant to Landlord during the Extension Term shall be the
        greater of:

      

      (i)   the
        Base
        Rent in effect on the expiration of the Lease Term (if the Base Rent is stated
        as an annual or other periodic rate, adjusted for the length of the Lease
        Term),
        and

      

      (ii)   the
        Fair
        Market Rent, as defined and determined pursuant to Paragraphs (c), (d), and
        (e)
        below.

      

      (c)   The
        term
        "Fair Market Rent" shall mean the Base Rent, expressed as an annual rent
        per
        square foot of floor area, which Landlord would have received from leasing
        the
        Premises for the Extension Term to an unaffiliated person which is not then
        a
        tenant in the Project, assuming that such space were to be delivered in "as-is"
        condition, and taking into account the rental which such other tenant would
        most
        likely have paid for such premises, including market escalations, provided
        that
        Fair Market Rent shall not in any event be less than the Base Rent for the
        Premises as of the expiration of the Lease Term. Fair Market Rent shall not
        be
        reduced by reason of any costs or expenses saved by Landlord by reason of
        Landlord's not having to find a new tenant for the Premises (including without
        limitation brokerage commissions, cost of improvements necessary to prepare
        the
        space for such tenant's occupancy, rent concession, or lost rental income
        during
        any vacancy period). Fair Market Rent means only the rent component defined
        as
        Base Rent in the Lease and does not include reimbursements and payments by
        Tenant to Landlord with respect to operating expenses and other items payable
        or
        reimbursable by Tenant under the Lease. In addition to its obligation to
        pay
        Base Rent (as determined herein), Tenant shall continue to pay and reimburse
        Landlord as set forth in the Lease with respect to such operating expenses
        and
        other items with respect to the Premises during the Extension Term. The
        arbitration process described below shall be limited to the determination
        of the
        Base Rent and shall not affect or otherwise reduce or modify the Tenant's
        obligation to pay or reimburse Landlord for such operating expenses and other
        reimbursable items.

      

      (d)   Landlord
        shall notify Tenant of its determination of the Fair Market Rent (which shall
        be
        made in Landlord's sole discretion and shall in any event be not less than
        the
        Base Rent in effect as of the expiration of the Lease Term) for the Extension
        Term, and Tenant shall advise Landlord of any objection within ten (10) days
        of
        receipt of Landlord's notice. Failure to respond within the ten (10)-day
        period
        shall constitute Tenant's acceptance of such Fair Market Rent. If Tenant
        objects, Landlord and Tenant shall commence negotiations to attempt to agree
        upon the Fair Market Rent within thirty (30) days of Landlord's receipt of
        Tenant's notice. If the parties cannot agree, each acting in good faith but
        without any obligation to agree, then the Lease Term shall not be extended
        and
        shall terminate on its scheduled termination date and Tenant shall have no
        further right hereunder or any remedy by reason of the parties' failure to
        agree
        unless Tenant or Landlord invokes the arbitration procedure provided below
        to
        determine the Fair Market Rent.

      

      (e)   Arbitration
        to determine the Fair Market Rent shall be in accordance with the Real Estate
        Valuation Arbitration Rules of the American Arbitration Association. Unless
        otherwise required by state law, arbitration shall be conducted in the
        metropolitan area where the Project is located by a single arbitrator
unaffiliated with either party. Either party may elect to arbitrate by sending
        written notice to the other party and the Regional Office of the American
        Arbitration Association within 5 business days after the thirty (30)-day
        negotiating period provided in Paragraph (d), invoking the binding arbitration
        provisions of this paragraph. Landlord and Tenant shall each submit to the
        arbitrator their respective proposal of Fair Market Rent. The arbitrator
        must
        choose between the Landlord's proposal and the Tenant's proposal and may
        not
        compromise between the two or select some other amount. Notwithstanding any
        other provision herein, the Fair Market Rent determined by the arbitrator
        shall
        not be less than, and the arbitrator shall have no authority to determine
        a Fair
        Market Rent less than, the Base Rent in effect as of the scheduled expiration
        of
        the Lease Term. The cost of the arbitration shall be paid by Landlord if
        the
        Fair Market Rent is that proposed by Landlord and by Tenant if the Fair Market
        Rent is that proposed by Tenant; and shall be borne equally otherwise. If
        the
        arbitrator has not determined the Fair Market Rent as of the end of the Lease
        Term, Tenant shall pay 105 percent of the Base Rent in effect under the Lease
        as
        of the end of the Lease Term until the Fair Market Rent is determined as
        provided herein. Upon such determination, Landlord and Tenant shall make
        the
        appropriate adjustments to the payments between them.

      
        
          
          

        

        
          -16-

          
            

          

        

        
          
          

        

      

      (f)   The
        parties consent to the jurisdiction of any appropriate court to enforce the
        arbitration provisions of this Addendum and to enter judgment upon the decision
        of the arbitrator.

      

      (g)   Except
        for the Base Rent as determined above, Tenant's occupancy of the Premises
        during
        the Extension Term shall be on the same terms and conditions as are in effect
        immediately prior to the expiration of the initial Lease Term; provided,
        however, Tenant shall have no further right to extend the Lease Term pursuant
        to
        this addendum or to any allowances, credits or abatements or options to expand,
        contract, renew or extend the Lease.

      

      (h)   If
        Tenant
        does not send the Extension Notice within the period set forth in Paragraph
        (a),
        Tenant's right to extend the Lease Term shall automatically terminate. Time
        is
        of the essence as to the giving of the Extension Notice and the notice of
        Tenant's objection under Paragraph (d).

      

      (i)   Landlord
        shall have no obligation to refurbish or otherwise improve the Premises for
        the
        Extension Term. The Premises shall be tendered on the Commencement Date of
        the
        Extension Term in "as-is" condition.

      

      (j)   If
        the
        Lease is extended for the Extension Term, then Landlord shall prepare and
        Tenant
        shall execute an amendment to the Lease confirming the extension of the Lease
        Term and the other provisions applicable thereto.

      

      (k)   If
        Tenant
        exercises its right to extend the term of the Lease for the Extension Term
        pursuant to this Addendum, the term "Lease Term" as used in the Lease, shall
        be
        construed to include, when practicable, the Extension Term except as provided
        in
        (g) above.

      
        
          
          

        

        
          -17-

          
            

          

        

        
          
          

        

      

      ADDENDUM
        4

      

      CONSTRUCTION

      (TURNKEY)

      

      ATTACHED
        TO AND A PART OF THE LEASE AGREEMENT

      DATED
        JANUARY 19, 2007, BETWEEN

      

      CATELLUS
        OPERATING LIMITED PARTNERSHIP

      and

      ViewSonic
        Corporation, a Delaware corporation

      

      

      (a)   Landlord
        agrees to furnish or perform at Landlord's sole cost and expense those items
        of
        construction and those improvements (the "Initial Improvements") specified
        below:

      

      1. 
        The reslurry and restriping and curb painting of the parking lot 

      2. 
        The replacement of the fabric awning over the patio area

      

      

      (b)   If
        Tenant
        shall desire any changes, Tenant shall so advise Landlord in writing and
        Landlord shall determine whether such changes can be made in a reasonable
        and
        feasible manner. Any and all costs of reviewing any requested changes, and
        any
        and all costs of making any changes to the Initial Improvements which Tenant
        may
        request and which Landlord may agree to shall be at Tenant's sole cost and
        expense and shall be paid to Landlord upon demand and before execution of
        the
        change order.

      

      (c)   Landlord
        and Tenant shall meet prior to the construction of the Initial Improvements
        and
        mutually agree on the striping of the parking lot and aesthetics and quality
        of
        the awning.

      
        
          
          

        

        
          -18-

          
            

          

        

        
          
          

        

      

      ADDENDUM
        5

      

      HVAC
        MAINTENANCE CONTRACT

      

      ATTACHED
        TO AND A PART OF THE LEASE AGREEMENT

      DATED
        JANUARY 19, 2007, BETWEEN

      ______

      CATELLUS
        OPERATING LIMITED PARTNERSHIP

      and

      ViewSonic
        Corporation, a Delaware corporation

      

      

      

      

      Paragraph
        11, captioned "TENANT REPAIRS," is revised to include the
        following:

      

      Tenant
        agrees to enter into and maintain through the term of the Lease, a regularly
        scheduled preventative maintenance/service contract for servicing all hot
        water,
        heating and air conditioning systems and equipment within the Premises. Landlord
        requires a qualified HVAC contractor perform this work. A certificate must
        be
        provided to the Landlord upon occupancy of the leased Premises.

      

      The
        service contract must become effective within thirty (30) days of occupancy,
        and
        service visits should be performed on a quarterly basis. Landlord suggests
        that
        Tenant send the following list to a qualified HVAC contractor to be assured
        that
        these items are included in the maintenance contract:

      

      
        	 	
                1.

              	
                Adjust
                  belt tension

              

      

      
        	 	
                2.

              	
                Lubricate
                  all moving parts, as necessary;

              

      

      
        	 	
                3.

              	
                Inspect
                  and adjust all temperature and safety
                  controls;

              

      

      
        	 	
                4.

              	
                Check
                  refrigeration system for leaks and
                  operation;

              

      

      
        	 	
                5.

              	
                Check
                  refrigeration system for moisture; 

              

      

      
        	 	
                6.

              	
                Inspect
                  compressor oil level and crank case
                  heaters;

              

      

      
        	 	
                7.

              	
                Check
                  head pressure, suction pressure and oil
                  pressure;

              

      

      
        	 	
                8.

              	
                Inspect
                  air filters and replace when
                  necessary;

              

      

      
        	 	
                9.

              	
                Check
                  space conditions; 

              

      

      
        	 	
                10.

              	
                Check
                  condensate drains and drain pans and clean, if
                  necessary;

              

      

      
        	 	
                11.

              	
                Inspect
                  and adjust all valves;

              

      

      
        	 	
                12.

              	
                Check
                  and adjust dampers;

              

      

      
        	 	
                13.

              	
                Run
                  machine through complete cycle.

              

      

      
        
          
          

        

        
          -19-

          
            

          

        

        
          
          

        

      

      ADDENDUM
        6

      

      MOVE-OUT
        CONDITIONS

      

      ATTACHED
        TO AND A PART OF THE LEASE AGREEMENT

      DATED
        JANUARY 19, 2007, BETWEEN

      ______

      CATELLUS
        OPERATING LIMITED PARTNERSHIP

      and

      ViewSonic
        Corporation, a Delaware corporation

      

      

      Per
        Paragraph 21, Tenant is obligated to check and address prior to move-out
        of the
        Premises the following items. Landlord expects to receive the Premises in
        a well
        maintained condition, with normal wear and tear of certain areas acceptable.
        The
        following list is designed to assist Tenant in the move-out procedures but
        is
        not intended to be all inclusive.

      

      
        	
                1.

              	
                All
                  lighting is to be placed into good working order. This includes
                  replacement of bulbs, ballasts, and lenses as
                  needed.

              

      

      

      
        	
                2.

              	
                All
                  truck doors and dock levelers should be serviced and placed in
                  good
                  operating order. This would include the necessary replacement of
                  any
                  dented truck door panels and adjustment of door tension to insure
                  proper
                  operation. All door panels which are replaced need to be painted
                  to match
                  the Building standard.

              

      

      

      
        	
                3.

              	
                All
                  structural steel columns in the warehouse and office should be
                  inspected
                  for damage. Repairs of this nature should be pre-approved by the
                  Landlord
                  prior to implementation.

              

      

      

      
        	
                4.

              	
                Heating/air-conditioning
                  systems should be placed in good working order, including the necessary
                  replacement of any parts to return the unit to a well maintained
                  condition. This includes warehouse heaters and exhaust fans. Upon
                  move-out, Landlord will have an exit inspection performed by a
                  certified
                  mechanical contractor to determine the
                  condition.

              

      

      

      
        	
                5.

              	
                All
                  holes in the sheet rock walls should be repaired prior to
                  move-out.

              

      

      

      
        	
                6.

              	
                Facilities
                  should be returned in a clean condition which would include cleaning
                  of
                  the coffee bar, restroom areas, windows, and other portions of
                  the
                  space.

              

      

      

      
        	
                7.

              	
                The
                  warehouse should be in broom clean condition with all inventory
                  and
                  racking removed. There should be no protrusion of anchors from
                  the
                  warehouse floor and all holes should be appropriately patched.
                  If
                  machinery/equipment is removed, the electrical lines should be
                  properly
                  terminated at the nearest junction
                  box.

              

      

      

      
        	
                8.

              	
                All
                  exterior windows with cracks or breakage should be
                  replaced.

              

      

      

      
        	
                9.
                  

              	
                The
                  Tenant shall provide keys for all locks on the Premises, including
                  front
                  doors, rear doors, and interior
                  doors.

              

      

      

      
        	
                10.

              	
                Items
                  that have been added by the Tenant and affixed to the Building
                  will remain
                  the property of Landlord, unless agreed otherwise. This would include
                  but
                  is not limited to mini-blinds, air conditioners, electrical, water
                  heaters, cabinets, flooring, etc. If Landlord notifies Tenant during
                  its
                  approval process for Alterations that such Alterations will have
                  to be
                  removed at the end of the term, then Landlord retains the right
                  to have
                  the Tenant remove these at Tenant’s
                  expense.

              

      

      

      
        	
                11.

              	
                All
                  electrical systems should be left in a safe condition that conforms
                  to
                  code. Bare wires and dangerous installations should be corrected
                  prior to
                  move-out.

              

      

      

      
        	
                12.

              	
                All
                  plumbing fixtures should be in good working order, including the
                  water
                  heater. Faucets and toilets should not
                  leak.

              

      

      

      
        	
                13.

              	
                All
                  dock bumpers must be left in place and well
                  secured.

              

      

    

     

     

    -20-EXHIBIT
      10.1

    

    

    Habiger
      Employment Agreement

    

    EXECUTIVE
      EMPLOYMENT AGREEMENT

    

    This
      Executive Employment Agreement (this “Agreement”), effective as of January 23,
      2007 (the “Effective Date”) is made by and between Sonic Solutions (“Company”)
      and David C. Habiger (“Executive”).

    

    RECITALS

    

    WHEREAS,
      Company presently employs Executive as its Chief Executive Officer;
      and

    

    WHEREAS,
      Company is desirous of continuing to employ Executive in an executive capacity
      on the terms and conditions, and for the consideration, hereinafter set forth
      and Executive is desirous of continuing in the employ of Company on such terms
      and conditions and for such consideration;

    

    NOW,
      THEREFORE, for and in consideration of the mutual promises, covenants and
      obligations contained herein, Company and Executive agree as
      follows:

    

    AGREEMENT

    

    1. Employment
      and Duties.

    

    1.1. Employment.
      Beginning as of Effective Date, Company agrees to employ Executive and Executive
      agrees to be employed by Company in accordance with the terms and conditions
      of
      this Agreement.

     

    1.2. Position.
      During
      the term of employment under this Agreement, Company shall employ Executive
      in
      the position of Chief Executive Officer of Company, or in such other executive
      positions as the parties mutually may agree.

    

    1.3. Duties
      and Services.
      Executive agrees to serve in the position referred to in
      Section 1.2
      and to
      perform diligently and to the best of his abilities the duties and services
      appertaining to such office as reasonably directed by Company. Executive’s
      employment shall also be subject to the policies contained in Company’s Conduct
      of Conduct and other similar documents, all as amended from time to
      time.

    

    1.4. Other
      Interests.
      Executive agrees, during the period of his employment by Company, to devote
      his
      full business time, energy and best efforts to the business and affairs of
      Company and its affiliates and not to engage without the Company’s consent,
      directly or indirectly, in any other business, investment, or activity that
      interferes with Executive’s performance of Executive’s duties hereunder, is
      contrary to the interests of Company or any of its affiliates, or except as
      approved by Company in advance, requires any significant portion of Executive’s
      business time.

    

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

    1.5. Duty
      of Loyalty.
      Executive acknowledges and agrees that Executive owes a fiduciary duty of
      loyalty, fidelity and allegiance to act at all times in the best interests
      of
      Company and to do no act which would injure the business, interests, or
      reputation of Company or any of its subsidiaries or affiliates. In keeping
      with
      these duties, Executive shall make full disclosure to Company of all business
      opportunities pertaining to Company’s business and shall not appropriate for
      Executive’s own benefit business opportunities concerning the subject matter of
      the fiduciary relationship.

     

    1.6. Conflicts
      of Interest.
      It is
      agreed that any direct or indirect interest in, connection with, or benefit
      from
      any outside activities, particularly commercial activities, which interest
      might
      in any way adversely affect Company or any of its affiliates, involves a
      possible conflict of interest. In keeping with Executive’s fiduciary duties to
      Company, Executive agrees that Executive shall not knowingly become involved
      in
      a conflict of interest with Company or any of its affiliates, or upon discovery
      thereof, allow such a conflict to continue. Moreover, Executive agrees that
      Executive shall disclose to Company any facts which might involve such a
      conflict of interest that has not been approved by Company’s Board of Directors
      (the “Board”). Executive agrees that Company’s determination as to whether a
      conflict of interest exists shall be conclusive. Company reserves the right
      to
      take such action as, in its judgment, will end the conflict.

     

    2. At
      Will Employment.
      Executive’s employment is at-will, and, subject to Section 6
      and the
      other terms hereof, either Executive or Company the Company may terminate the
      employment relationship at any time, with or without cause or
      notice.

     

    3. Compensation.

     

    3.1. Base
      Salary.
      Executive shall receive an annual base salary equal to $350,000. Executive’s
      base salary shall be reviewed periodically, and may be modified from time to
      time by the Board (or as the Board may designate consistent with applicable
      laws
      and regulations, by the Compensation Committee or other committee of the Board
      or by an officer of the Company) in its sole discretion and, after any such
      change, Executive’s new level of base salary shall be Executive’s base salary
      for purposes of this Agreement until the effective date of any subsequent
      change. Executive’s base salary shall be paid in equal installments in
      accordance with Company’s standard policy regarding payment of compensation to
      its employees.

     

    3.2. Incentive
      Compensation.
      While
      Executive is actively employed under this Agreement, Executive shall be entitled
      to participate in any long term or annual incentive plans maintained by Company
      for its executives.

     

    3.3. Other
      Benefits.
      While
      employed by Company, Executive shall be allowed to participate, on the same
      basis generally as other employees of Company, in all general employee benefit
      plans and programs, including improvements or modifications of the same, which
      on the Effective Date or thereafter are made available by Company to Company’s
      employees. Such benefits plans and programs may include, without limitation,
      medical, health, and dental care, life insurance, and disability protection.
      Nothing in this Agreement is to be construed or interpreted to provide greater
      rights, participation, coverage, or benefits under such benefit plans or
      programs than provided to similarly situated employees pursuant to the terms
      and
      conditions of such benefit plans and programs.

    

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

       

    

    3.4. Changes
      Permitted.
      Company
      shall not by reason of Sections 3.2
      and
3.3
      be
      obligated to institute, maintain, or refrain from changing, amending, or
      discontinuing, any of such benefit plans or programs, so long as such actions
      are similarly applicable to covered employees generally.

     

    4. Protection
      of Information.
      Executive and Company each ratify, confirm and acknowledge their continuing
      agreement to the terms set forth in the Invention and Confidential Information
      Agreement previously entered into between them.

     

    5. Statements
      Concerning Company; Legal
      Requirements.

    

    5.1. Statements
      Concerning Company.
      Executive shall refrain, both during the employment relationship and after
      the
      employment relationship terminates, from publishing any oral or written
      statements about Company, any of its affiliates, or any of such entities’
officers, employees, agents or representatives that are slanderous, libelous,
      or
      defamatory; or that disclose confidential information about Company, any of
      its
      affiliates, or any of such entities’ business affairs; or that place Company,
      any of its affiliates, or any of such entities’ officers, employees, agents, or
      representatives in a false light before the public. A violation or threatened
      violation of this prohibition may be enjoined by the courts.

     

    5.2. Compliance
      with Laws.
      Executive shall at all times comply with United States laws applicable to
      Executive’s actions on behalf of Company, including, without limitation, the
      United States Foreign Corrupt Practices Act.

     

    6. Benefits
      Upon Termination of Employment.

     

    6.1. Termination
      without Cause or for Good Reason.
      In the
      event that Executive’s employment is terminated by Company without Cause (as
      defined in Section 6.2)
      or
      voluntarily by Executive for Good Reason (as defined in
      Section 6.3)
      and
      unless such termination occurs within 180 days of a Change in Control (as
      defined in Section 7),
      Company shall provide Executive with a lump sum payment in an amount equal
      to
      175% of Executive’s annual base salary at the level in effect immediately prior
      to his termination, less applicable deductions or withholdings.

     

    6.2. Circumstances
      Under Which Termination Benefits Will Not Be Paid.
      Company
      shall not be obligated to provide Executive the termination benefits described
      in Section 6.1
      if
      Executive’s employment is terminated by Company for Cause or if Executive
      voluntarily terminates his employment with Company other than for Good Reason.
      For purposes hereof, “Cause” shall mean (i) Executive’s conviction of any felony
      under federal or state law, or any fraud, misappropriation or embezzlement,
      or
      (ii) Executive’s breach of a fiduciary duty owed to Company or commission
      of a material violation of Section 4.

     

    6.3. Termination
      for Good Reason.
      Executive may voluntarily terminate his employment with Company for Good Reason
      within 30 days of the occurrence of: 

    

    
      	 	
              (a)

            	
              a
                material adverse change in Executive’s position causing it to be of
                materially less stature or responsibility without Executive’s written
                consent, and such a materially adverse change shall in all events
                be
                deemed to occur if Executive no longer serves as Chief Executive
                Officer
                of a publicly traded company, unless Executive consents in writing
                to such
                change; 

            

    

    

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

       

    

    
      	 	
              (b)

            	
              a
                reduction, without Executive’s written consent, in his level of
                compensation (including base salary and fringe benefits);
                

            

    

    

    
      	 	
              (c)

            	
              a
                relocation of his principal place of employment by more than 50 miles,
                or
                

            

    

    

    
      	 	
              (d)

            	
              failure
                to cure a material breach by Company (or its successor) of this Agreement
                within thirty (30) days after written notice from Executive to the
                Company
                identifying such breach.

            

    

     

    7. Change in
      Control. 

    

    7.1. Definition.
      For
      purposes of this Agreement, “Change in Control” shall have the
      same meaning as “Corporate Transaction,”
as
      such term
      is defined in the Company’s 2004 Equity Compensation
      Plan.

    

    7.2. Benefit
      Upon Change in Control.
      In the
      event of a Change in Control, Company shall provide Executive with the following
      benefits: 

    

    
      	 	
              (a)

            	
              Executive
                shall receive a lump sum payment in an amount equal to 175% of his
                annual
                base salary at the level in effect immediately prior to the Change
                in
                Control, less applicable deductions or withholdings;
                and

            

    

    

    
      	 	
              (b)

            	
              All
                unvested stock options, restricted stock units, or other equity
                compensation held by Executive at the time of such Change in Control
                shall
                immediately vest in full.

            

    

    

    8. Miscellaneous.

    

    8.1. Notices.
      For
      purposes of this Agreement, notices and all other communications provided for
      herein shall be in writing and shall be deemed to have been duly given when
      personally delivered or when mailed by United States registered or certified
      mail, return receipt requested, postage prepaid, addressed as
      follows:

    

    
      	
            	If
              to Company to:	
              Sonic
                Solutions

              
                101
                  Rowland Way

                Novato,
                  CA 94945

                Attention:
                  General Counsel

              

            

      	 	 	 

      	 	If to Executive
              to:	
              c/o
                Sonic Solutions

              101
                Rowland Way

              
                Novato,
                  CA 94945

              

            

    

     

    or
      to
      such other address as either party may furnish to the other in writing in
      accordance herewith, except that notices of changes of address shall be
      effective only upon receipt.

    

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

       

    

    8.2. Applicable
      Law.
      This
      Agreement will be governed by and construed in accordance with the laws of
      the
      state of California, as applied to agreements entered into and performed
      entirely within the state of California between residents of the state of
      California.

    

    8.3. No
      Waiver.
      No
      waiver of any breach of any provision of this Agreement will constitute a waiver
      of any prior, concurrent or subsequent breach of the same or any other
      provisions hereof, and no waiver will be effective unless made in writing and
      signed by a duly authorized representative of the waiving party.

    

    8.4. Severability.
      If for
      any reason a court of competent jurisdiction finds any provision of this
      Agreement, or portion thereof, to be unenforceable, that provision of the
      Agreement will be enforced to the maximum extent permissible so as to effect
      the
      intent of the parties, and the remainder of this Agreement will continue in
      full
      force and effect.

    

    8.5. Counterparts.
      This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed to be an original, but all of which together will constitute one and
      the
      same Agreement.

    

    8.6. Withholding
      of Taxes and Other Employment Deductions.
      Company
      may withhold from any benefits and payments made pursuant to this Agreement
      all
      federal, state, city and other taxes as may be required pursuant to any law
      or
      governmental regulation or ruling and all other normal employee deductions
      made
      with respect to Company’s employees generally.

    

    8.7. Headings.
      The
      Section headings have been inserted for purposes of convenience and shall not
      be
      used for interpretive purposes.

    

    8.8. Gender
      and Plurals.
      Wherever the context so requires, the masculine gender includes the feminine
      or
      neuter, and the singular number includes the plural and conversely.

    

    8.9. Affiliate.
      As used
      in this Agreement, the term “affiliate” shall mean any entity which owns or
      controls, is owned or controlled by, or is under common ownership or control
      with, Company.

    

    8.10. Assignment.
      This
      Agreement shall be binding upon and inure to the benefit of Company and any
      successor of Company, by merger or otherwise. Except as provided in the
      preceding sentence, this Agreement, and the rights and obligations of the
      parties hereunder, are personal and neither this Agreement, nor any right,
      benefit, or obligation of either party hereto, shall be subject to voluntary
      or
      involuntary assignment, alienation or transfer, whether by operation of law
      or
      otherwise, without the prior written consent of the other party.

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

       

    

    8.11. Entire
      Agreement.
      Except
      as provided in (i) written company policies promulgated by Company dealing
      with issues such as securities trading, business ethics, governmental affairs
      and political contributions, consulting fees, commissions or other payments,
      compliance with law, investments and outside business interests as officers
      and
      employees, reporting responsibilities, administrative compliance, and the like,
      (ii) the written benefits, plans, and programs referenced in
      Sections 3.2
      and
3.3,
      and
      (iii) any written agreements contemporaneously or hereafter executed by
      Company and Executive, this Agreement constitutes the entire agreement of the
      parties with regard to such subject matters, and contains all of the covenants,
      promises, representations, warranties, and agreements between the parties with
      respect to Executive’s employment relationship with Company and the term and
      termination of such relationship, and replaces and merges previous agreements
      and discussions pertaining to the employment relationship between Company and
      Executive. Notwithstanding the preceding provisions of this
      Section 8.11,
      except
      as may expressly be provided herein, the execution of this Agreement shall
      not
      affect the rights of the parties pursuant to (A) stock options and
      restricted stock units previously awarded to Executive and currently outstanding
      under any and all stock plans maintained by Company, and (B) any
      confidentiality, non-disclosure or similar agreement or commitment between
      the
      parties. Each party to this Agreement acknowledges that no representation,
      inducement, promise or agreement, oral or written, has been made by either
      party, or by anyone acting on behalf of either party, which is not embodied
      herein, and that no agreement, statement, or promise relating to the employment
      of Executive by Company, which is not contained in this Agreement, shall be
      valid or binding. Any modification of this Agreement will be effective only
      if
      it is in writing and signed by the party to be charged.

    

    

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

    

    

    
      	
              EXECUTIVE

            	
              SONIC
                SOLUTIONS

            
	
              By:
                /s/ David
                Habiger                
                

            	
              By:
                /s/ Paul
                Norris                       
                

            
	
              Name:
                David Habiger

            	
              Name:
                Paul Norris

            
	
              Date:
                January 23, 2007

            	
              Title:
                SVP and General Counsel

            
	
               

            	
              Date:
                January 23, 2007

            

    

    

    

    
      
        
        

      

      
        -6-

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