Document:

GARDEN
VIEW 

PROFESSIONAL

CENTER

 

Lease
Cover Page

 

	
      Landlord:
	
      Garden
      View Professional Center, LLC

	 	 
	
      Address:
	
      c/o
      CMC, Inc.

      P.O.
      Box 636

      Vista,
      CA 92085

	 	 
	
      Tenant:
	
      Western
      Pacific Bancorp, Inc.

	 	 
	
      Leased
      Premises:
	
      499
      N. El Camino Real

      Suite
      C-100

      Encinitas,
      CA 92024-1302

 

The
Garden View Professional Building

499
North El Camino Real, Encinitas, CA 92024

TABLE
OF CONTENTS

 

	 	 	 
	
      Article
      1
	
      LEASE
      OF PREMISES
	
      3

	
      Article
      2
	
      DEFINITIONS
	
      3-4

	
      Article
      3
	
      EXHIBITS
      AND ADDENDA
	
      4

	
      Article
      4
	
      DELIVERY
      OF POSSESSION
	
      4

	
      Article
      5
	
      RENT
	
      4-5

	
      Article
      6
	
      INTEREST
      AND LATE CHARGES; RETURNED CHECKS
	
      5

	
      Article
      7
	
      SECURITY
      DEPOSIT
	
      5

	
      Article
      8
	
      TENANT'S
      USE OF THE PREMISES
	
      5-6

	
      Article
      9
	
      SERVICES
      AND UTILITIES
	
      6

	
      Article
      10
	
      CONDITION
      OF THE PREMISES
	
      6-7

	
      Article
      11
	
      CONSTRUCTION,
      REPAIRS AND MAINTENANCE
	
      7

	
      Article
      12
	
      ALTERATIONS
      AND ADDITIONS
	
      7-8

	
      Article
      13
	
      LEASEHOLD
      IMPROVEMENTS; TENANTS PROPERTY
	
      8

	
      Article
      14
	
      RULES
      AND REGULATIONS
	
      8

	
      Article
      15
	
      CERTAIN
      RIGHTS RESERVED BY LANDLORD
	
      8-9

	
      Article
      16
	
      ASSIGNMENT
      AND SUBLETTING
	
      9

	
      Article
      17
	
      HOLDING
      OVER
	
      9-10

	
      Article
      18
	
      SURRENDER
      OF PREMISES
	
      10

	
      Article
      19
	
      DESTRUCTION
      OR DAMAGE
	
      10

	
      Article
      20
	
      EMINENT
      DOMAIN
	
      10-11

	
      Article
      21
	
      INDEMNIFICATION
	
      11

	
      Article
      22
	
      TENANT'S
      INSURANCE
	
      11-12

	
      Article
      23
	
      WAIVER
      OF SUBROGATION
	
      12

	
      Article
      24
	
      SUBORDINATION
      AND ATTORNMENT
	
      12

	
      Article
      25
	
      TENANT
      ESTOPPEL CERTIFICATES
	
      12

	
      Article
      26
	
      TRANSFER
      OF LANDLORD'S INTEREST
	
      12

	
      Article
      27
	
      DEFAULT
	
      13

	
      Article
      28
	
      BROKERAGE
      FEES
	
      13-14

	
      Article
      29
	
      NOTICES
	
      14

	
      Article
      30
	
      GOVERNMENT
      ENERGY OR UTILITY CONTROLS
	
      14

	
      Article
      31
	
      QUIET
      ENJOYMENT
	
      14

	
      Article
      32
	
      OBSERVANCE
      OF LAW
	
      14-15

	
      Article
      33
	
      FORCE
      MAJEURE
	
      15

	
      Article
      34
	
      CURING
      TENANT’S DEFAULTS
	
      15

	
      Article
      35
	
      SIGN
      CONTROL
	
      15

	
      Arti-cle
      36
	
      RENTAL
      ADJUSTMENTS
	
      15

	
      Article
      37
	
      TAXES
      AND OPERATING COSTS
	 
	
      Article
      38
	
      UTILITIES
      AND SERVICES
	 
	
      Article
      39
	
      OPTIONS
      TO RENEW
	 
	
      Article
      40
	
      TENANT’S
      USE OF HAZARDOUS MATERIALS
	
      16-17

	
      Article
      41
	
      AUTHORITY
	
      17

	
      Article
      42
	
      RIGHT
      TO TERMINATE
	
      17

	
      Article
      43
	
      MISCELLANEOUS
	
      17-18

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

 

2

The
Garden View Professional Building

499
North El Camino Real

Encinitas,
CA 92024

This
lease between Garden View Professional Center, LLC (“Landlord”) and Western
Pacific Bancorp, a California Banking Corporation (“Tenant”) is dated December
6, 2003. 

1.
LEASE
OF PREMISES.

In
consideration of the Rent (as defined at Section 5.3) and the provisions of this
Lease, Landlord leases to Tenant and Tenant leases from Landlord the Premises
shown by diagonal lines on the floor plan attached hereto as Exhibit "A," and
further described at Section 2 (1). The Premises are located within the Building
and Project described in Section 2m. Tenant shall have the non-exclusive right
(unless otherwise provided herein) in common with Landlord, other tenants,
subtenants and invitees, to use of the Common Areas (as defined at Section
2e).

2.
DEFINITIONS.

As used
in this Lease, the following terms shall have the following
meanings:

a.
Base Rent
(initial): $138,804.00 per year not including Tenant’s proportionate share of
operating expenses. (Refer to Articles 5 and 37). This Base Rent is based on
$2.70 per square foot times 4,284 rentable square feet times 12
months.

b.
Base
Year: The
calendar year of 2004.

c.
Broker(s):
Charles D. Currey and Brian Lukacz, IPC Commercial Real Estate representing both
parties (dual representation).

d.
Rent
Commencement Date: August
1, 2004, or as otherwise provided herein. The term of this Lease shall be from
August 1, 2004 to July 31, 2009.

e.
Common
Areas: The
building lobbies, common corridors and hallways, and parking areas, stairways,
eleva-tors and other generally understood public or common areas. Landlord shall
have the right to regulate or restrict the use of the Common Areas.

f.
Expiration
Date: July
31, 2009, unless extended as per option(s) to renew as defined in Paragraph
39.

g.
Base
Rent Adjustment:
Each
anniversary of the lease term commencing August 1, 2006.

h.
Landlord's
Mailing Address.

	
      NOTICES
	
      RENT
      PAYMENTS

	
      Garden
      View Professional Center, llc.
	
      Garden
      View Professional Center

	
      C/o
      CMC, Inc.
	
      c/o
      LaSalle Bank

	
      P.O.
      Box 636
	
      135
      South LaSalle, Suite 1625

	
      Vista,
      CA 92085 
	
      Chicago,
      IL 60603-4177

	
      Tenant’s
      Mailing Address:
	
      Western
      Pacific Bancorp

	 	
      984
      Carmen Court

	 	
      San
      Marcos, CA 92069

i.
Monthly
Installments of Base Rent
(initial): $11,567.00 per month not including operating expenses. This monthly
installment is based on $2.70 per square foot times 4,284 rentable square
feet.

j.
Parking: Tenant
shall be permitted to park cars on a non-exclusive only basis in surface parking
facilities which comprise a portion of the plaza as set forth on the site plan,
which is attached as Exhibit “B”. Tenant shall abide by the other reasonable
parking regulations and rules set forth in Section 1.2 of Exhibit
“D”.

Tenant
shall be entitled to six (6) exclusive parking spaces, as shown on Exhibit
“B”.

All of
Tenant's employees shall park in the rear of the parking lot to make customer
parking more convenient to all tenants of The Garden View Professional Building.
It is Tenant's responsibility to notify, inform and instruct its employees in
this regard.

k.
Premises: That
portion of the Building, as defined in rentable Section 2m, containing
approximately 4,284 square feet of Rentable Area (4,156 square feet useable),
shown by diagonal lines on Exhibit "A," located in Building C, first floor and
known as Suite C-100. Rentable space includes 61 square feet of the front lobby
and 67 square feet of the rear lobby area directly behind the rear exit of the
space, which is required by the Fire Department for emergency exiting.

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

3

l.
Project: The
building of which the Premises are a part (the "Building") and any other
buildings or improvements on the real property (the "Property"), consisting of
32,949 square feet of gross building area, located at 499 North El Camino Real,
Encinitas, CA 92024, and further described in Exhibit "B". The Project is known
as The Garden View Professional Building. 

m.
Rentable
Area:
Rentable area includes the useable space and a prorata share of common area
determined by actual BOMA calculations of the rentable space and the useable
space. The useable space is the area in the suite exclusive of the prorata
portion of the common area.

n.
Security
Deposit:
$11,567.00. See Paragraph 7.

o.
State: the
State of California.

p.
Tenant's
First Adjustment Date (Section
5.2): August 1, 2005

q.
Tenant's
Proportionate Share: Such
share is a frac-tion, the numerator of which is the Rentable Area of the
Premises, and the denominator of which is the Rentable Area of the Project, as
determined by Landlord from time to time. The Project consists of three (3)
building(s) containing a total Rentable Area of 31,144 square feet.

r.
Tenant's
Use Clause (Article
8): Tenant shall use the Premises for the operation a commercial bank to include
retail banking, investment services and any and all related administrative
services. Tenant may have a night depository in the eastern wall of the
conference room as well as an ATM location as shown on attached Exhibit ‘I’.
Tenant shall be responsible for all costs to put its depository in the wall of
the building, subject to approval of the Landlord and the City of Encinitas.
Landlord will remove the planter area and provide an open dirt pad for Tenant to
pour the foundation to accommodate its ATM machine as shown in Exhibit “I”.
Tenant shall be responsible to bring required services to the pad including
electric, phone or vacuum tube lines to the Premises.

s.
Term: The
period commencing on the Commencement Date and expiring at midnight on the
Expiration Date.

3.
EXHIBITS
AND ADDENDA.

The
exhibits and addenda listed below (unless lined out) are incorporated by
reference in this Lease:

	a.	Exhibit
      "A"- Floor Plan showing the Premises.

	b.	Exhibit
      "B"- Site Plan of the Project.

Exhibit
"B-1"- Parking.

	d.	Exhibit
      "D"- Rules and Regulations.

	e.	Exhibit
      “E” - Signage.

	f.	Exhibit
      “F” - Estimated Operating Expenses.

	g.	Exhibit
      “G’ - Hazardous Materials

	h.	Exhibit
      “H” - Tenant Information & Management
Information

	i.	Exhibit
      “I” - ATM Location.

4.
DELIVERY
AND POSSESSION.

Landlord
will deliver the Premises to Tenant on August 1, 2004, or sooner based upon the
vacation of the Premises by the existing Tenant whose lease expires July 31,
2004 and Tenant may install its Tenant Improvements and fixtures any time after
that date.

5.
RENT.

5.1.
Payment
of Base Rent. Tenant
agrees to pay the Base Rent for the Premises. Monthly Installments of Base Rent
shall be payable in advance on the first day of each calendar month of the Term.
If the Term begins (or ends) on other than the first (or last) day of a calendar
month, the Base Rent for the partial month shall be prorated on a per diem
basis, calculated on the basis of a thirty (30) day month. Tenant shall pay
Landlord base rent in the amount of $11,567.00 on or before May 1, 2004 and
$11,567.00 on or before June 1, 2004 for a total prepaidbase rent of $23,134.00,
which shall be applied to the months of October, 2004 and November,
2004.

5.2.
Adjusted
Base Rent. The
Base Rent of $138,804.00 per year (and the corresponding Monthly Installments of
Base Rent) set forth at Section 2a shall be adjusted annually (the "Adjustment
Date"), commencing on Tenant's First Adjustment Date (See Article 36).
Adjustments will be based at a rate of three percent (3.0%) per year. Upon lease
execution, Landlord shall prepare a schedule of rents for the lease term and the
option term for the purpose of establishing future base rental rates.

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

4

 

5.3.
Definition
of Rent. All
costs and expenses which Tenant assumes or agrees to pay to Landlord under this
Lease shall be deemed additional rent (which, together with the Base Rent is
sometimes referred to as the "Rent"). The Rent shall be paid to the Building
manager (or other person) and at such place, as Landlord may from time to time
designate in writing, without any prior demand therefor and without deduction or
offset, in lawful money of the United States of America. 

5.4.
Rent
Control. If the
amount of Rent or any other payment due under this Lease violates the terms of
any governmental restric-tions on such Rent or payment, then the Rent or payment
due during the period of such restrictions shall be the maximum amount allowable
under those restrictions. Upon termination of the restrictions, Landlord shall,
to the extent it is legally permitted, recover from Tenant the difference
between the amounts received during the period of the restrictions and the
amounts Landlord would have received had there been no
restrictions.

5.5.
Taxes
Payable by Tenant. In
addition to the Rent and any other charges to be paid by Tenant hereunder,
Tenant shall reimburse Landlord upon demand for any and all taxes payable by
Landlord (other than net income taxes) which are not otherwise reimbursable
under this Lease, whether or not now customary or within the contemplation of
the parties, where such taxes are upon, measured by or reasonable attributable
to (a) the cost or value of Tenant's equipment, furniture, fixtures and other
personal property located in the Premises, or the cost or value of any leasehold
improvements made in or to the Premises by or for Tenant, other than Building
Standard Work made by Landlord, regardless of whether title to such improvements
is held by Tenant or Landlord; (b) the gross or net Rent payable under this
Lease, including, without limitation, any rental or gross re-ceipts tax levied
by any taxing authority with respect to the receipt of the Rent hereunder; (c)
the possession, leasing, operation, management, maintenance, alteration, repair,
use or occupancy by Tenant of the Premises or any portion thereof; or (d) this
transaction or any document to which Tenant is a party creating or transferring
an interest or an estate in the Premis-es. If it becomes unlawful for Tenant to
reimburse Landlord for any costs as required under this Lease, the Base Rent
shall be revised to net Landlord the same net Rent after imposition of any tax
or other charge upon Landlord as would have been payable to Landlord but for the
reimbursement being unlawful.

6.
INTEREST
AND LATE CHARGES; RETURNED CHECKS.

Tenant
acknowledges that the late payment of any Monthly Install-ment of Base Rent will
cause Landlord to lose the use of that money and incur costs and expenses not
contemplated under this Lease, including without limitation, administrative and
collec-tion costs and processing and accounting expenses, the exact amount of
which is extremely difficult to ascertain. Therefore, if any such installment is
not received by Landlord within ten (10) days from the date it is due, Tenants
shall pay Landlord a late charge equal to eight percent (8%) of such
in-stallment. Landlord and Tenant agree that this late charge represents a
reasonable estimate of such costs and expenses and is fair compensation to
Landlord for the loss suffered from such nonpay-ment by Tenant. Acceptance of
any interest or late charge shall not constitute a waiver of Tenant's default
with respect to such nonpayment by Tenant nor prevent Landlord from exercising
any other rights or remedies available to Landlord under this Lease. In the
event Tenant’s rent check is not honored by Landlord’s bank and is returned to
Landlord, Tenant shall pay a seventy-five dollar ($75.00) charge plus bank
charges for each returned check.

7.
SECURITY
DEPOSIT.
Simultaneously
herewith, Tenant has deposited with Landlord the Security Deposit set forth at
Section 2.0, as security for Tenant’s faithful performance of its obligations
under this lease. If the monthly Base Rent shall, from time to time, increase
during the term of this lease, Tenant shall, every two (2) years on the
anniversary of the lease, deposit with the Landlord additional money as a
Security Deposit so that the total amount of the Security Deposit held by
Landlord shall bear the same proportion to the then current Base Rent as the
initial Security Deposit bears to the initial Base Rent set forth in Article
2.a. of the lease. Landlord and Tenant agree that the Security Deposit may be
commingled with funds of Landlord and Landlord shall have no obligation or
liability for payment of interest on such deposit. Tenant shall not mortgage,
assign, transfer or encumber the Security Deposit without the prior written
consent of Landlord and any attempt by Tenant to do so shall be void, without
force or effect and shall not be binding upon Landlord.

8.
TENANT'S
USE OF THE PREMISES.

Tenant
shall use the Premises solely for the purposes set forth in Tenant's Use Clause.
Tenant shall not use or occupy the Premises in violation of law or any covenant,
condition or restriction affecting the Building or Project or the certificate of
occupancy issued for the Building or Project, and shall, upon notice from
Landlord, immediately discontinue any use of the Premises which is declared by
any governmental authority having jurisdiction to be a violation of law or the
certificate of occupancy. Tenant, at Tenant's own cost and expense, shall comply
with all laws, ordinances, regulations, rules and/or any directions of any
governmental agencies or authorities having jurisdiction which shall, by reason
of the nature of Tenant's use or occupancy of the Premises, impose any duty upon
Tenant or Landlord with respect to the Premises or its use or occupation. Tenant
shall obtain proper permits from the City of Encinitas, the Fire Department, and
any other government agencies to operate its business at this location. In the
event any of these agencies require building modifications to adapt the building
to Tenant’s current or future use, Tenant agrees to make such modifications at
Tenant’s sole expense. A judgment of any court of competent jurisdiction or the
admis-sion by Tenant in any action or proceeding against Tenant that Tenant has
violated any such laws, ordinances, regulations, rules and/or directions in the
use of the Premises shall be deemed to be a conclusive determination of that
fact as between Landlord and Tenant. Tenant shall not do or permit to be done
anything which will invalidate or increase the cost of any fire, extended
coverage or other insurance policy covering the Building or 

 

	Landlord	  
      		Landlord 	   
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      	 	Tenant	   
      

 

 

5

 

Project
and/or property located therein, and shall comply with all rules, orders,
regulations, requirements and recommendations of the Insurance Services Office
or any other organization performing a similar function. Tenant shall promptly
upon demand reimburse Landlord for any additional premium charged for such
policy by reason of Tenant's failure to comply with the provi-sions of this
Article. Tenant shall not do or permit anything to be done in or about the
Premises which will in any way obstruct or interfere with the rights of other
tenants or occupants of the Building or Project, or injure or annoy them, or use
or allow the Premises to be used for any improper, immoral, unlawful or
objectionable purpose, nor shall Tenant cause, maintain or permit any nuisance
in, on or about the Premises. Tenant shall not commit or suffer to be committed
any waste in or upon the Premises. Tenant agrees to conduct its business in a
manner that will not be objectionable to other tenants in the buildings,
including noise, vibration, odor or fumes. In the event Landlord receives
com-plaints from other tenants and determines in its sole reason-able judgment
that Tenant is conducting its operations in a manner so as to be objectionable
to other tenants, Tenant agrees, upon notice from Landlord thereof, to promptly
modify the conduct of its operations to eliminate such objectionable
operations.

9.
SERVICES
AND UTILITIES.

Provided
that Tenant is not in default hereunder, Landlord agrees to furnish to the
Premises twenty-four (24) hours a day, seven (7) days a week, subject to the
Rules and Regulations of the Building or Project, water, and electricity for
normal desk top office equipment and normal copying equipment, and heating,
ventilation and air conditioning ("HVAC") as required in Land-lord's judgment
for the comfortable use and occupancy of the Premises. Landlord shall maintain
and keep lighted the common stairs, common entries and restrooms of the
building. Land-lord shall not be in default hereunder or be liable for any
damages directly or indirectly resulting from, nor shall the Rent be abated by
reason of (i) the installation, use or inter-ruption of use of any equipment in
connection with the furnishing of any of the forego-ing services by the utility
company or as to which Landlord is not otherwise liable under the lease, (ii)
failure to furnish or delay in furnishing any such services where such failure
or delay is caused by accident or any condi-tion or event beyond the reason-able
control of Landlord, (iii) the limitation, curtailment or ration-ing of, or
restric-tions on, use of water, electricity, gas or any other form of energy
serving, the Premis-es, Building or Project. Landlord shall not be liable under
any circumstances for a loss of or injury to property or business, however
occur-ring, through or in connection with or incidental to failure to furnish
any such services. If Tenant uses heat generating machines or equipment in the
Premises which affect the tempera-ture otherwise maintained by the HVAC system,
Landlord reserves the right to install supplemen-tary air condi-tioning units in
the Premises and the cost thereof, including the cost of installation, operation
and maintenance thereof shall be paid by Tenant to Landlord upon demand by
Landlord.

Tenant
shall have its own electric meter and shall be solely responsible for all costs
of electricity furnished by Landlord for their use.

Tenant
shall not, without the written consent of Landlord, use any apparatus or device
in the Premises, including without limita-tion, elec-tronic data processing
machines, punch card machines or machines using in excess of 120 volts, which
consumes more electricity than is usually furnished or supplied for the use of
Premises as general office space, as determined by Land-lord. 

Tenant
shall not connect any apparatus with electric current except through existing
electrical outlets in the Premises. Tenant shall not consume water or electric
current in excess of that usually furnished or supplied for the use of Premises
as general office space (as determined by Landlord), without first procuring the
written consent of Landlord, which Landlord may refuse, and in the event of
consent, Landlord may have installed a water meter or electrical current meter
in the Premises to measure the amount of water or electric current consumed. The
cost of any such meter and of its installation, maintenance and repair shall be
paid for by the Tenant and Tenant agrees to pay to Landlord promptly upon demand
for all such water and electric current consumed as shown by said meters, at the
rates charged for such services by the local public utility plus any additional
expense incurred in keeping account of the water and electric current so
consumed. If a separate meter is not installed, the excess cost for such water
and electric current shall be estab-lished by an estimate made by a utility
company or electrical engineer hired by Landlord at Tenant's expense. Tenant
shall be responsible for the maintenance and repair of any such meters at its
sole cost.

Landlord
shall furnish lighting replacement for exterior building standard lights, window
washing and common area janitor services in a manner that such services are
customarily furnished to comparable office buildings in the area.

10.
CONDITION
OF THE PREMISES.

a.
Structural
Items and Government Regulations.

Landlord
shall insure, upon lease commencement, that the Premises comply with all
governmental regulations and building codes, including, without limitation, fire
and sprinkler system and ADA requirements. Tenant shall be responsible for any
ADA upgrades that are specifically related to its use of the Premises. The
structural portions of the Premises, including the foundation and roof, shall be
in good condition during the lease term.

b.
Possession
of Premises by Tenant as Evidence of Condition of Premises.

 

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Except as
set forth in the provisions of Section 10. a. above, Tenant's taking possession
of the Premises shall be deemed conclusive evidence that as of the date of
taking possession the Premises are in good order and satisfactory condition,
except for such matters as to which Tenant gave Landlord notice on or before the
Commencement Date. No promise of Landlord to alter, remodel, repair or improve
the Premises, the Building or the Project and no representation, express or
implied, respecting any matter or thing relating to the Premises, Building,
Project or this Lease (includ-ing, without limitation, the condition of the
Premises, the Building or the Project) have been made to Tenant by Landlord or
its Broker or Sales Agent, other than as may be contained herein or in a
separate exhibit or addendum signed by Landlord and Tenant.

11.
CONSTRUCTION,
REPAIRS AND MAINTENANCE.

a.
Landlord's
Obligations.

The
structural portions of the Leased Premises, the foundations, roof, exterior
portions of the outside walls, gutters and down spouts of the leased Premises
shall be maintained by Landlord, except when the conditions requiring such
repairs shall result from Tenant's acts or the faults of Tenant, its officers,
agents or employees. If Tenant refuses or neglects to make repairs or
replacements as required under this Article, Landlord may make such repairs, and
upon completion thereof, Tenant shall forthwith pay as additional rent
Landlord's costs for making such repairs or replacements.

b.
Tenant's
Obligations.

(1)
Tenant at Tenant's sole expense shall, except for services furnished by Landlord
pursuant to Article 9 hereof, maintain the Premises in good order, condition and
repair, including the interior surfaces of the ceilings, walls and floors, all
doors, all interior windows, all plumbing, pipes and fixtures, electrical
wiring, switches, fixtures, and HVAC systems, Building Standard furnishings and
special items and equipment installed by or at the expense of
Tenant.

(2)
Tenant shall be responsible for all repairs and alterations in and to the
Premises, Building and Project and the facilities and systems thereof, the need
for which arises out of (i) Tenant's use of the Premises, (ii) the installation,
removal, use or operation of Tenant's Property (as defined in Article 13)in the
Premises, (iii) the moving of Tenant's Property into or out of the Building, or
(iv) the act, omission, misuse or negligence of Tenant, its agents,
contrac-tors, employees or invitees except for outside lighting replace-ments
and window wash-ing.

(3) If
Tenant fails to maintain the Premises in good order, condition and repair,
Landlord shall give Tenant notice to do such acts as are reasonably required to
maintain the Premises. If Tenant fails to properly commence such work within
sixty (60) days after notice, then Landlord shall have the right to do such acts
and expend such funds at the expense of Tenant as are reason-ably required to
perform such work. Any amounts so expended by Landlord shall be paid by Tenant
within thirty (30) days. Landlord shall have no liability to Tenant for any
damage, inconvenience, or interference with the use of the Premises by Tenant as
a result of performing any such work.

c.
Compliance
with Law.
Landlord and Tenant shall each do all acts required to comply with all
applicable laws, ordinances, and rules of any public authority relating to their
respective maintenance obligations as set forth herein.

d.
Waiver
by Tenant. Tenant
expressly waives the benefits of any statute now or hereafter in effect which
would otherwise afford the Tenant the right to make repairs at Landlord's
expense or to terminate this Lease because of Landlord's failure to keep the
Premises in good order, condition and repair.

e.
Load and Equipment Limits. Tenant
shall not place a load upon any floor of the Premises which exceeds the load per
square foot which such floor was designed to carry, as determined by Landlord or
Landlord's structural engineer. The cost of any such determination made by
Landlord's structural engineer shall be paid for by Tenant upon demand. Tenant
shall not install business machines or mechanical equipment which cause noise or
vibration to such a degree as to be objectionable to Landlord or other Building
tenants.

f. Except
as otherwise expressly provided in this Lease, Landlord shall have no liability
to Tenant nor shall Tenant's obligations under this Lease be reduced or abated
in any manner whatsoever by reason of any inconvenience, annoyance, interruption
or injury to business arising from Landlord's making any repairs or changes
which Landlord is required or permitted by this Lease or by any other tenant's
lease or required by law to make in or to any portion of the Project, Building
or the Premises. Landlord shall nevertheless use reasonable efforts to minimize
any interference with Tenant's business in the Premises. 

g. Tenant
shall give Landlord prompt notice of any damage to or defective condition in any
part or appurtenance of the Building's mechanical, electrical, plumbing, HVAC or
other systems serving, located in, or passing through the Premises.

h. Upon
the expiration or earlier termination of this Lease, Tenant shall return the
Premises to Landlord clean and in the same condition as on the date Tenant took
possession, except for normal wear and tear. Any damage to the Premises,
including any structural damage, resulting from Tenant's use or from the removal
of Tenant's fixtures, furnishings and equipment pursuant to Section 13b shall be
repaired by Tenant at Tenant's expense.

 

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12.
ALTERATIONS
AND ADDITIONS.

a.
Following completion of the initial leasehold improvements, tenant shall not
make any additions, alterations or improvements to the Premises without
obtaining the prior written consent of Landlord. Landlord's consent may be
conditioned on Tenant's removing any such additions, alterations or
improve-ments upon the expiration of the Term and restoring the Premises to the
same condition as on the date Tenant took possession. All work with respect to
any addition, alteration or improvement shall be done in a good and workmanlike
manner by properly qualified and licensed personnel approved by Landlord, and
such work shall be diligently prosecuted to completion. 

b. Tenant
shall pay the costs of any work done on the Premises pursuant to Section 12a,
and shall keep the Premises, Building and Project free and clear of liens of any
kind. Tenant shall indemnify, defend against and keep Landlord free and harmless
from all liability, loss, damage, costs, attorneys' fees and any other expense
incurred on account of claims by any person performing work or furnishing
materials or supplies for Tenant or any person claiming under
Tenant.

Tenant
shall keep Tenant's leasehold interest, and any additions or improvements which
are or become the property of Landlord under this Lease, free and clear of all
attachment or judgment liens. Before the actual commencement of any work for
which a claim or lien may be filed, Tenant shall give Landlord notice of the
intended commencement date a sufficient time before that date to enable Landlord
to post notices of non-responsibility or any other notices which Landlord deems
necessary for the proper protection of Landlord's interest in the Premises,
Building or the Project, and Landlord shall have the right to enter the Premises
and post such notices at any reasonable time.

c.
Landlord may require, at Landlord's sole option, that Tenant provide to
Landlord, at Tenant's expense, a lien and completion bond in an amount equal to
at least one and one-half (1 & 1/2) times the total estimated cost of any
additions, alterations or improvements to be made in or to the Premises, to
protect Landlord against any liability for mechanic's and materialmen's liens
and to insure timely completion of the work. Nothing contained in this Section
12c shall relieve Tenant of its obligation under Section 12b to keep the
Premises, Building and Project free of all liens.

d. Unless
their removal is required by Landlord as provided in Section 12a, all additions,
alterations and improvements made to the Premises shall become the property of
Landlord and be surrendered with the Premises upon the expiration of the Terms;
provided, however, Tenant's equipment, machinery and trade fixtures which can be
removed without damage to the Premises shall remain the property of Tenant and
may be removed, subject to the provisions of Section 13b.

13.
LEASEHOLD
IMPROVEMENTS; TENANT'S PROPERTY.

a. All
fixtures, equipment, improvements and appurtenances attached to or built into
the Premises at the commencement of or during the Term, whether or not by or at
the expense of Tenant ("Leasehold Improvements"), shall be and remain a part of
the Premises, shall be the property of Landlord and shall not be removed by
Tenant, except as expressly provided in Section 13b.

b. All
movable partitions, business and trade fixtures, machinery and equipment,
communications equipment and office equipment located in the Premises and
acquired by or for the account of Tenant, without expense to Landlord, which can
be removed without structural damage to the Building, and all furniture,
furnishings and other articles of movable personal property owned by Tenant and
located in the Premises (collectively "Tenant's Property") shall be and shall
remain the property of Tenant and may be removed by Tenant at any time during
the Term; provided that if any of Tenant's Property is removed, Tenant shall
promptly repair any damage to the Premises or to the Building resulting from
such removal. Landlord and Tenant agree that modular working areas and modular
cabinets put in at expense of the Tenant are Tenant's sole property and can be
removed as long as the premises are returned to "as is" condition upon move-in
date.

14.
RULES
AND REGULATIONS.

Tenant
agrees to comply with (and cause its agents, contractors, employees and invitees
to comply with) the rules and regulations attached hereto as Exhibit "D" and
with such reasonable modifi-ca-tions thereof and additions thereto as Landlord
may from time to time make. Landlord shall not be responsible for any violation
of said rules and regulations by other tenants or occupants of the Building or
Project.

15.
CERTAIN
RIGHTS RESERVED BY LANDLORD.

Landlord
reserves the following rights, exercisable without liability to Tenant for (a)
damage or injury to property, person or business, (b) causing an actual or
constructive eviction from the Premises, or (c) disturbing Tenant's use or
possession of the Premises:

a. To
name the Building and Project and to change the name or street address of the
Building or Project;

 

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b. To
install and maintain all signs on the exterior and interior of the Building and
Project; except that Tenant shall be allowed to purchase, install, and maintain
its standard district office sign with the prior approval of the Landlord which
shall not be unreasonably withheld;

c. To
have pass keys to the Premises and all doors within the Premises, excluding
Tenant's vaults and safes;

d. At any
time during the Term, and on reasonable prior notice to Tenant, to inspect the
Premises, and to show the Premises to any prospective purchaser or mortgagee of
the Project, or to any assignee of any mortgage on the Project, or to others
having an interest in the Project or Landlord, and during the last six months of
the Term, to show the Premises to prospective tenants thereof; and

e. To
enter the Premises for the purpose of making inspections, repairs, alterations,
additions or improvements to the Premises or the Building, and to take all steps
as may be necessary or desirable for the safety, protection, maintenance or
preservation of the Premises or the Building or Landlord's interest therein, or
as may be necessary or desirable for the operation or improvement of the
Building or in order to comply with laws, orders or requirements of governmental
or other authority. Landlord agrees to use its best efforts (except in an
emergency) to minimize interference with Tenant's business in the Premises in
the course of any such entry.

16.
ASSIGNMENT
AND SUBLETTING.

No
assignment of this Lease or sublease of all or any part of the Premises shall be
permitted, except as provided in this Article 16.

a. Tenant
shall not, without the prior written consent of Land-lord, assign or hypothecate
this Lease or any interest herein or sublet the Premises or any part thereof, or
permit the use of the Premises by any party other than Tenant. Any of the
forego-ing acts without such consent shall be void and shall, at the option of
Landlord, terminate this Lease. This Lease shall not, nor shall any interest of
Tenant herein, be assignable by operation of law without the written consent of
Landlord.

b. If at
any time or from time to time during the Term Tenant desires to assign this
Lease or sublet all or any part of the Premises, Tenant shall give notice to
Landlord setting forth the terms and provisions of the proposed assignment or
sublease, and the identity of the proposed assignee or subtenant. Tenant shall
promptly supply Landlord with such information concerning the business
background and financial condition of such proposed assignee or subtenant as
Landlord may reasonably request Landlord shall have the option, exercisable by
notice given to Tenant within twenty (20) days after Tenant's notice is given,
either to sublet such space from Tenant at the rental and on the other terms set
forth in this Lease for the term set forth in Tenant's notice, or, in the case
of an assignment, to terminate this Lease. If Landlord does not exercise such
option, Tenant may assign the Lease or sublet such space to such proposed
assignee or subtenant on the following further conditions:

(1)
Landlord shall have the right to approve such Proposed assignee or subtenant,
which approval shall not be unreasonably withheld;

(2) The
assignment or sublease shall be on the same terms set forth in the notice given
to Landlord;

(3) No
assignment or sublease shall be valid and no assignee or sublessee shall take
possession of the Premises until an execut-ed counterpart of such assignment or
sublease has been delivered to Landlord;

(4) No
assignee or sublessee shall have a further right to assign or sublet except on
the terms herein contained; and

(5) Any
sums or other economic consideration received by Tenant as a result of such
assignment or subletting, however denominat-ed under the assignment or sublease,
which exceed, in the aggregate, (i) the total sums which Tenant is obligated to
pay Landlord under this Lease (prorated to reflect obligations allocable to any
portion of the Premises subleased), plus (ii) any real estate brokerage
commissions or fees payable in connec-tion with such assignment or subletting,
shall be paid to Landlord as additional rent under this lease without affecting
or reducing any other obligations of Tenant hereunder.

c.
Notwithstanding the provisions of paragraphs a and b above, Tenant may assign
this Lease or sublet the Premises or any portion thereof, without Landlord's
consent and without extend-ing any recapture or termination option to Landlord,
to any corporation which controls, is controlled by or is under common control
with Tenant, or to any corporation resulting from a merger or consolidation with
Tenant, or to any person or entity which acquires all the assets of Tenant's
business as a going concern, provided that (i) the assignee or sublessee
assumes, in full, the obligations of Tenant under this lease, (ii) Tenant
remains fully liable under this Lease, and (iii) the use of the Premises under
Article 8 remains unchanged.

d. No
subletting or assignment shall release Tenant of Tenant's obligations under this
Lease or alter the primary liability of Tenant to pay the Rent and to perform
all other obligations to be performed by Tenant hereunder. The acceptance of
Rent by Land-lord from any other person shall not be deemed to be a waiver by
Landlord of any provision hereof. Consent to one assignment or subletting shall
not be deemed consent to any subsequent assign-

 

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ment or
subletting. In the event of default by an assignee or subtenant of Tenant or any
successor of Tenant in the performance of any of the terms hereof Landlord may
proceed directly against Tenant without the necessity of exhausting remedies
against such assignee, subtenant or successor. Land-lord may consent to
subsequent assignments of the Lease or sublettings or amendments or
modifications to the Lease with assignees of Tenant, without notifying Tenant,
or any successor of Tenant, and without obtain-ing its or their consent thereto
and any
such actions shall not relieve Tenant of liability under this
Lease.

e. (Not
Applicable)

17.
HOLDING
OVER.

If after
expiration of the Term, or any subsequent exercised option period, Tenant
remains in possession of the Premises with Landlord's permission (express or
implied), Tenant shall become a tenant from month to month only, upon all the
provi-sions of this Lease (except as to term and Base Rent), but the "Monthly
Installments of Base Rent" payable by Tenant shall be increased to one hundred
percent (100%) of the Monthly Install-ments of Base Rent payable by Tenant at
the expiration of the Term. Such monthly rent shall be payable in advance on or
before the first day of each month. If either party desires to terminate such
month to month tenancy, it shall give the other party not less than thirty (30)
days advance written notice of the date of termination.

18.
SURRENDER
OF PREMISES.

a. Tenant
shall peaceably surrender the Premises to Landlord at the termination of its
possession of the Premises of this lease on the Expiration Date, in broom-clean
condition and in as good condition as when Tenant took possession, except for
(i) reasonable wear and tear, (ii) loss by fire or other casualty, and (iii)
loss by condemnation. Tenant shall, on Landlord's request, remove Tenant's
Property on or before the above referenced Termination Date and promptly repair
all damage to the Premises or Building caused by such removal.

b. If
Tenant abandons or surrenders the Premises, or is dispossessed by process of law
or otherwise, any of Tenant's Property left on the Premises shall be deemed to
be abandoned, and, at Landlord's option, title shall pass to Landlord under this
Lease as by a bill of sale. If Landlord elects to remove all or any part of such
Tenant's Property, the cost of removal, including repairing any damage to the
Premises or Building caused by such removal, shall be paid by Tenant. On the
Expiration Date of the original term or any option period thereafter Tenant
shall surrender all keys to the Premises upon termination of Tenant's
possession.

19.
DESTRUCTION
OR DAMAGE.

a. If the
Premises or the portion of the Building necessary for Tenant's occupancy is
damaged by fire, earthquake, act of God, the elements, or other casualty,
Landlord shall, subject to the provisions of this Article, promptly repair the
damage, if such repairs can, in Landlord's opinion, be completed within ninety
(90) days and render the premises operational within sixty (60) days. If
Landlord determines that repairs can be completed within ninety (90) days and
render the premises operational within sixty (60) days, this Lease shall remain
in full force and effect, except that if such damage is not the result of the
negligence or willful misconduct of Tenant or Tenant's agents, employees,
contractors, licensees or in-vitees, the Base Rent shall be abated to the extent
Tenant's use of the Premises is impaired, commencing with the date of damage and
continuing until completion of the repairs required of Landlord under Section
19d.

b. If in
Landlord's opinion, such repairs to the Premises or portion of the Building
necessary for Tenant's occupancy cannot be completed within ninety (90) days and
render the premises operational within sixty (60) days, Landlord may elect, upon
notice to Tenant given within thirty (30) days after the date of such fire or
other casualty, to repair such damage, in which event this Lease shall continue
in full force and effect, but the Base Rent shall be partially abated as
provided in Section 19a. If Landlord does not so elect to make such repairs,
this Lease shall terminate as of the date of such fire or other
casualty.

c. If any
other portion of the Building or Project is totally destroyed or damaged to the
extent that in Landlord's opinion repair thereof cannot be completed within one
hundred twenty (120) days, Landlord may elect upon notice to Tenant given within
thirty (30) days after the date of such fire or other casualty, to repair such
damage, in which event this Lease shall continue in full force and effect, but
the Base Rent shall be partially abated as provided in Section 19a. If Landlord
does not elect to make such repairs, this Lease shall terminate as of the date
of such fire or other casualty.

d. If the
Premises are to be repaired under this Article, Landlord shall repair at its
cost any injury or damage to the Building and Building Standard Work in the
Premises. Tenant shall be responsible at its sole cost and expense for the
repair, restoration and replacement of any other Leasehold Improvements and
Tenant's Property. Landlord shall not be liable for any loss of business,
inconvenience or annoyance arising from any repair or restoration of any portion
of the Premises, Building or Project as a result of any damage from fire or
other casualty.

e. This
Lease shall be considered an express agreement governing any case of damage to
or destruction of the Premises, Building or Project by fire or other casualty,
and any present or future law which purports to govern the rights of Landlord
and Tenant in such circumstances in the absence of express agreement, shall have
no application.

 

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20.
EMINENT
DOMAIN.

a. If the
whole of the Building or Premises is lawfully taken by condemnation or in any
other manner for any public or quasi public purpose, this Lease shall terminate
as of the date of such taking, and Rent shall be prorated to such date. If less
than the whole of the Building or Premises is so taken, this Lease shall be
unaffected by such taking, provided that (i) Tenant shall have the right to
terminate this Lease by notice to Landlord given within ninety (90) days after
the date of such taking if twenty percent (20%) or more of the Premises is taken
and the remaining area of the Premises is not reasonably sufficient for Tenant
to continue operation of its business, and (ii) Landlord shall have the right to
terminate this Lease by notice to Tenant given within ninety (90) days after the
date of such taking. If either Landlord or Tenant so elects to terminate this
Lease, the Lease shall terminate on the thirtieth (30th) day after either such
notice. The Rent shall be prorated to the date of termination. If this lease
continues in force upon such partial taking, the Base Rent and Tenant's
Proportionate Share shall be equitably adjusted according to the remaining
Rentable Area of the Premises and Project.

b. In the
event of any taking, partial or whole, all of the proceeds of any award,
judgment or settlement payable by the condemning authority shall be the
exclusive property of Landlord, and Tenant hereby assigns to Landlord all of its
right, title and interest in any award, judgment or settlement from the
condemning authority. Tenant, however, shall have the right, to the extent that
Landlord's award is not reduced or prejudiced, to claim from the condemning
authority (but not from Landlord) such compensation as may be recoverable by
Tenant in its own right for relocation expenses and damage to Tenant's personal
property.

c. In the
event of a partial taking of the Premises which does not result in a termination
of this lease, Landlord shall restore the remaining portion of the Premises as
nearly as practicable to its condition prior to the condemnation or taking, but
only to the extent of Building Standard Work. Tenant shall be responsible at its
sole cost and expense for the repair, restoration and replacement of any other
Leasehold Improvements and Tenant's Property.

21.
INDEMNIFICATION.

a. Tenant
shall indemnify and hold Landlord harmless against and from liability and claims
of any kind for loss or damage to property of Tenant or any other person, or for
any injury to or death of any person, arising out of: (1) Tenant's use of the
Premises, or any work, activity or other things allowed or suffered by Tenant to
be done in, on or about the Premises; (2) any breach or default by Tenant of any
of Tenant's obligations under this Lease; or (3) any negligent or otherwise
tortious act or omission of Tenant, its agents, employees, invitees or
contractors. Tenant shall at Tenant's expense, and by counsel satisfactory to
Landlord, defend Landlord in any action or proceeding arising from any such
claim and shall indemnify Landlord against all costs, attorneys' fees, expert
witness fees and any other expenses incurred in such action or proceeding. As a
material part of the consideration for Landlord's execution of this Lease,
Tenant hereby assumes all risk of damage or injury to any person or property in,
on or about the Premises except for damage or injury caused by the negligence of
Landlord.

b.
Landlord shall not be liable for injury or damage which may be sustained by the
person or property of Tenant, its employees, invitees or customers, or any other
person in or about the Premises, caused by or resulting from fire, steam,
electricity, gas, water or rain which may leak or flow from or into any part of
the Premises, or from the breakage, leakage, obstruction or other defects of
pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting
fixtures, whether such damage or injury results from conditions arising upon the
Premises or upon other portions of the Building or Project or from other sources
except for injury or damage caused by Landlord's negligence. Landlord shall not
be liable for any damages arising from any act or omission of any other tenant
of the Building or Project.

22.
TENANT'S
INSURANCE.

a. All
insurance required to be carried by Tenant hereunder shall be issued by
responsible insurance companies acceptable to Landlord and Landlord's lender and
qualified to do business in the State. Each policy shall name Landlord, and at
Landlord's request any mortgagee of Landlord, as an additional insured, as their
respective interests may appear. Each policy shall contain (i) a cross-liability
endorsement, (ii) a provision that such policy and the coverage evidenced
thereby shall be primary and non-contribut-ing with respect to any policies
carried by Landlord and that any coverage carried by Landlord shall be excess
insurance, and (iii) a waiver by the insurer of any right of subroga-tion
against Landlord, its agents, employees and representatives, which arises or
might arise by reason of any payment under such policy or by reason of any act
or omission of Landlord, its agents, employees or representatives. A copy of
each paid up policy (authenticated by the insurer) or certificate of the insurer
evidencing the existence and amount of each insurance policy required hereunder
shall be delivered to Landlord before the date Tenant is first given the right
of possession of the Premises, and thereafter within thirty (30) days after any
demand by Landlord therefor. Landlord may, at any time and from time to time,
inspect and/or copy any insurance policies required to be maintained by Tenant
hereunder. No such policy shall be cancelable except after twenty (20) days
written notice to Landlord and Landlord's lender. Tenant shall furnish Landlord
with renewals or "binders" of any such policy at least ten (10) days prior to
the expiration thereof. Tenant agrees that if Tenant does not take out and
maintain such insurance, Landlord may (but shall not be required to) procure
said insurance on Tenant's behalf and charge the Tenant the premiums together
with a twenty-five percent (25%) handling charge, payable upon demand. Tenant
shall have the right to provide such insurance coverage pursuant to blanket
policies obtained by the Tenant, provided such blanket policies expressly afford
coverage to the Premises, Landlord, Landlord's mortgagee and Tenant as required
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b.
Beginning on the date Tenant is given access to the Premises for any purpose and
continuing until expiration of the Term, Tenant shall procure, pay for and
maintain in effect policies of casualty insurance covering (i) all Leasehold
Improvements (including any alterations, additions or improvements as may be
made by Tenant pursuant to the provisions of Article 12 hereof), and (ii) trade
fixtures, merchandise and other personal property from time to time in, on or
about the Premises, in an amount not less than one hundred percent (100%) of
their actual replacement cost from time to time, providing protection against
any peril included within the classification "Fire and Extended Coverage"
together with insurance against sprinkler damage, vandalism and malicious
mischief. The proceeds of such insurance shall be used for the repair or
replacement of the property so insured. Upon termination of this Lease following
a casualty as set forth herein, the proceeds under (i) shall be paid to
Landlord, and the proceeds under (ii) above shall be paid to
Tenant.

c.
Beginning on the date Tenant is given access to the Premises for any purpose and
continuing until expiration of the Term, Tenant shall procure, pay for and
maintain in effect workers' compensation insurance as required by law and
comprehensive public liability and property damage insurance with respect to the
construction of improvements on the Premises, the use, operation or condition of
the Premises and the operations of Tenant in, on or about the Premises,
providing personal injury and broad form property damage coverage for not less
than One Million Dollars ($1,000,000.00) combined single limit for bodily
injury, death and property damage liability.

d. Not
less than every three (3) years during the Term, Land-lord and Tenant shall
mutually agree to increases in all of Tenant's insurance policy limits for all
insurance to be carried by Tenant as set forth in this Article. In the event
Landlord and Tenant cannot mutually agree upon the amounts of said

increases,
then Tenant agrees that all insurance policy limits as set forth in this Article
shall be adjusted for increases in the cost of living in the same manner as is
set forth in Section 5.2 hereof for the adjustment of the Base
Rent.

23.
WAIVER
OF SUBROGATION.

Landlord
and Tenant each hereby waive all rights of recovery against the other and
against the officers, employees, agents and representatives of the other, on
account of loss by or damage to the waiving party of its property or the
property of others under its control, to the extent that such loss or damage is
insured against under any fire and extended coverage insurance policy which
either may have in force at the time of the loss or damage. Tenant shall, upon
obtaining the policies of insurance required under this Lease, give notice to
its insurance carrier or carriers that the foregoing mutual waiver of
subrogation is contained in this Lease.

24.
SUBORDINATION
AND ATTORNMENT.

Upon
written request of Landlord, or any first mortgagee or first deed of trust
beneficiary of Landlord, or ground lessor of Landlord, Tenant shall, in writing,
subordinate its rights under this Lease to the lien of any first mortgage or
first deed of trust, or to the interest of any lease in which Landlord is
lessee, and to all advances made or hereafter to be made thereunder. However,
before signing any subordination agreement, Tenant shall have the right to
obtain from any lender or lessor or Landlord requesting such subordination, an
agreement in writing providing that, as long as Tenant is not in default
hereunder, this Lease shall remain in effect for the full Term and any option
period thereafter which Tenant may exercise. The holder of any security interest
may, upon written notice to Tenant, elect to have this Lease subordinated prior
to its security interest regardless of the time of the granting or recording of
such security interest.

In the
event of any foreclosure sale, transfer in lieu of foreclosure or termination of
the lease in which Landlord is lessee, Tenant shall attorn to the purchaser,
transferee or lessor as the case may be, and recognize that party as Landlord
under this Lease, provided such party acquires and accepts the Premises subject
to this Lease.

25.
TENANT
ESTOPPEL CERTIFICATES.

Within
ten (10) days after written request from Landlord, Tenant shall execute and
deliver to Landlord or Landlord's designee, a written statement certifying (a)
that this Lease is unmodified and in full force and effect, or is in full force
and effect as modified and stating the modifications; (b) the amount of Base
Rent and the date to which Base Rent and additional rent have been paid in
advance; (c) the amount of any security deposited with Landlord; and (d) that
Landlord is not in default hereunder or, if Landlord is claimed to be in
default, stating the nature of any claimed default. Any such statement may be
relied upon by a purchaser, assignee or lender. Tenant's failure to execute and
deliver such statement within the time required shall at Landlord's election be
a default under this Lease and shall also be conclusive upon Tenant that: (1)
this Lease is in full force and effect and has not been modified except as
represented by Landlord; (2) there are no uncured defaults in Landlord's
performance and that Tenant has no right of offset, counter-claim or deduction
against Rent; and (3) not more than one month's Rent has been paid in
advance.

 

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26.
TRANSFER
OF LANDLORD'S INTEREST.

In the
event of any sale or transfer by Landlord of the Premis-es, Building or Project,
and assignment of this Lease by Landlord, Landlord shall be and is hereby
entirely freed and relieved of any and all liability and obligations contained
in or derived from this Lease arising out of any act, occurrence or omission
relating to the Premises, Building, Project or Lease occurring after the
consummation of such sale or transfer, providing the purchaser shall expressly
assume all of the covenants and obligations of Landlord under this Lease. If any
security deposit or prepaid Rent has been paid by Tenant, Landlord may transfer
the security deposit or prepaid Rent to Landlord's successor and upon such
transfer, Landlord shall be relieved of any and all further liability with
respect thereto.

27.
DEFAULT.

27.1
Tenant's
Default. The
occurrence of any one or more of the following events shall constitute a default
and breach of this Lease by Tenant:

a. If
Tenant abandons or vacates the Premises; or

b. If
Tenant fails to pay any Rent or any other charges required to be paid by Tenant
under this Lease and such failure continues for five (5) days after such payment
is due and payable; or

c. If
Tenant fails to promptly and fully perform any other covenant, condition or
agreement contained in this Lease and such failure continues for thirty (30)
days after written notice thereof from Landlord to Tenant; or

d. If a
writ of attachment or execution is levied on this Lease or on any of Tenant's
Property; or

e. If
Tenant makes a general assignment for the benefit of creditors, or provides for
an arrangement, composition, extension or adjustment with its creditors;
or

f. If
Tenant files a voluntary petition for relief or if a petition against Tenant in
a proceeding under the federal bankruptcy laws or other insolvency laws is filed
and not withdrawn or dismissed within forty-five (45) days thereafter, or if
under the provisions of any law providing for reorganization or winding up of
corporations, any court of competent jurisdiction assumes jurisdiction, custody
or control of Tenant or any substantial part of its property and such
jurisdiction, custody or control remains in force unrelinquished, unstayed or
unterminated for a period of forty-five (45) days; or

g. If in
any proceeding or action in which Tenant is a party, a trustee, receiver, agent
or custodian is appointed to take charge of the Premises or Tenant's Property
(or has the authority to do so) for the purpose of enforcing a lien against the
Premises or Tenant's Property; or

h. If
Tenant is a partnership or consists of more than one (1) person or entity, if
any partner of the partnership or other person or entity is involved in any of
the acts or events described in subparagraphs d through g above.

27.2
Remedies. In the
event of Tenant's default hereunder, then in addition to any other rights or
remedies Landlord may have under any law, Landlord shall have the right, at
Landlord's option, without further notice or demand of any kind to do the
following:

a.
Terminate this Lease and Tenant's right to possession of the Premises and
reenter the Premises and take possession thereof, and Tenant shall have no
further claim to the Premises or under this Lease; or

b.
Continue this Lease in effect, reenter and occupy the Premises for the account
of Tenant, and collect any unpaid Rent or other charges which have or thereafter
become due and payable; or 

c.
Reenter the Premises under the provisions of subparagraph b, and thereafter
elect to terminate this Lease and Tenant's right to possession of the
Premises.

If
Landlord reenters the Premises under the provisions of subparagraphs b or c
above, Landlord shall not be deemed to have terminated this Lease or the
obligation of tenant to pay any Rent or other charges thereafter accruing,
unless Landlord notifies Tenant in writing of Landlord's election to terminate
this Lease. In the event of any reentry to retaking of possession by Landlord,
Landlord shall have the right, but not the obligation, to remove all or any part
of Tenant's Property in the Premises and to place such property in storage at a
public warehouse at the expense and risk of Tenant. If Landlord elects to relet
the Premises for the account of Tenant, the rent received by Landlord from such
reletting shall be applied as follows: first, to the payment of any indebtedness
other than Rent due hereunder from tenant to Landlord; second, to the payment of
any costs of such reletting; third, to the payment of the cost of any
alterations or repairs to the Premises; fourth to the payment of Rent due and
unpaid hereunder; and the balance, if any, shall be held by Landlord and applied
in payment of future Rent as it becomes due. If that portion of rent received
from the reletting which is applied against the Rent due hereunder is less than
the amount of the Rent due, Tenant shall pay the deficiency to Landlord promptly
upon demand by Landlord. Such deficiency shall be calculated and paid monthly.
Tenant shall also pay to Landlord, as soon as determined, any costs and expenses
incurred by Landlord in connection with such reletting or in making alterations
and repairs to the Premises, which are not covered by the rent received from the
reletting.

 

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Should
Landlord elect to terminate this Lease under the provisions of subparagraph a or
c above, Landlord may recover as damages from tenant the following:

1.
Past
Rent. The
worth at the time of the award of any unpaid rent which had been earned at the
time of termination; plus

2.
Rent
Prior to Award: The
worth at the time of the award of the amount by which the unpaid Rent which
would have been earned after termination until the time of award exceeds the
amount of such rental loss that Tenant proves could have been reasonably
avoided; plus

3.
Rent
After Award. The
worth at the time of the award of the amount by which the unpaid Rent for the
balance of the Term after the time of award exceeds the amount of the rental
loss that tenant proves could be reasonably avoided; plus

4.
Proximately
Caused Damages. Any
other amount necessary to compensate Landlord for all detriment proximately
caused by Tenant's failure to perform its obligations under this Lease or which
in the ordinary course of things would be likely to result therefrom, including,
but not limited to, any costs or expenses (including attorneys' fees), incurred
by Landlord in (a) retaking possession of the Premises, (b) maintaining the
Premises after Tenant's default, (c) preparing the Premises for reletting to a
new tenant, including any repairs or alterations, and (d) reletting the
Premises, including broker's commissions.

"The
worth at the time of the award" as used in subparagraphs 1 and 2 above, is to be
computed by allowing interest at the rate of ten percent (10%) per annum. "The
worth at the time of the award" as used in subparagraph 3 above, is to be
computed by discounting the amount at the discount rate of the Federal Reserve
Bank situated nearest to the Premises at the time of the award plus one percent
(1%).

The
waiver by Landlord of any breach of any term, covenant or condition of this
Lease shall not be deemed a waiver of such term, covenant or condition or of any
subsequent breach of the same or any other term, covenant or condition.
Acceptance of Rent by Landlord subsequent to any breach hereof shall not be
deemed a waiver of any preceding breach other than the failure to pay the
particular Rent so accepted, regardless of Landlord's knowledge of any breach at
the time of such acceptance of Rent. Landlord shall not be deemed to have waived
any term, covenant or condition unless Landlord gives Tenant written notice of
such waiver.

27.3.
Landlord's
Default. If
Landlord fails to perform any covenant, condition or agreement contained in this
Lease within thirty (30) days after receipt of written notice from Tenant
specifying such default, or if such default cannot reasonably be cured within
thirty (30) days, if Landlord fails to commence to cure within that thirty (30)
day period, then Landlord shall be liable to Tenant for any damages sustained by
Tenant as a result of Landlord's breach; provided, however, it is expressly
understood and agreed that if Tenant obtains a money judgment against Landlord
resulting from any default or other claim arising under this Lease, that
judgment shall be satisfied only out of the rents, issues, profits, and other
income actually received on account of Landlord's right, title and interest in
the Premises, Building or Project, and no other real, personal or mixed property
of Landlord (or of any of the partners which comprise Landlord, if any) wherever
situated, shall be subject to levy to satisfy such judgment. If after notice to
Landlord of default, Landlord (or any first mortgagee or first deed of trust
beneficiary of Landlord) fails to cure the default as provided herein, then
Tenant shall have the right to cure that default at Landlord's expense. Tenant
shall not have the right to terminate this Lease or to withhold, reduce or
offset any amount against any payments of Rent or any other charges due and
payable under this Lease except as otherwise specifically provided
herein.

28.
BROKERAGE
FEES. Charles
D. Currey and Brian Lukacz represent the Landlord and the Tenant in this
transaction and shall be paid fees as per separate agreement.

29.
NOTICES.

All
notices, approvals and demands permitted or required to be given under this
Lease shall be in writing and deemed duly served or given if personally
delivered or sent by certified or registered U.S. mail, postage prepaid, and
addressed as follows: (a) if to Landlord, to Landlord's Mailing Address and to
the Building manager, and (b) if to Tenant, to Tenant's Mailing Address;
provided, however, notices to Tenant shall be deemed duly served or given if
delivered or mailed to Tenant at the Premises. Landlord and Tenant may from time
to time by notice to the other designate another place for receipt of future
notices.

30.
GOVERNMENT
ENERGY OR UTILITY CONTROLS.

In the
event of imposition of federal, state or local government controls, rules,
regulations, or restrictions on the use or consumption of energy or other
utilities during the Term, both 

 

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Landlord
and Tenant shall be bound thereby. In the event of a difference in
interpretation by Landlord and Tenant of any such controls, the interpretation
of Landlord shall prevail, and Landlord shall have the right to enforce
compliance therewith, including the right of entry into the Premises to effect
compliance.

31.
QUIET
ENJOYMENT.

Tenant,
upon paying the Rent and performing all of its obliga-tions under this Lease,
shall peaceably and quietly enjoy the Premises, subject to the terms of this
Lease and to any mortgage, lease, or other agreement to which this Lease may be
subordinate.

32.
OBSERVANCE
OF LAW.

Tenant
shall not use the Premises or permit anything to be done in or about the
Premises which will in any way conflict with any law, statute, ordinance or
governmental rule or regulation now in force or which may hereafter be enacted
or promulgated. Tenant shall, as its sole cost and expense, promptly comply with
all laws, statutes, ordinances and governmental rules, regulations or
requirements now in force or which may hereafter be in force, and with the
requirements of any board of fire insurance underwriters or other similar bodies
now or hereafter constituted, relating to, or affecting the condition, use or
occupancy of the Premises, excluding structural changes not related to or
affected by Tenant's improvements or acts. The judgment of any court of
competent jurisdiction or the admission of Tenant in any action against Tenant,
whether Landlord is a party thereto or not, that Tenant has violated any law,
ordinance or governmental rule, regulation or requirement, shall be conclusive
of that fact as between Landlord and Tenant.

33.
FORCE
MAJEURE.

Any
prevention, delay or stoppage of work to be performed by Landlord or Tenant
which is due to strikes, labor disputes, inability to obtain labor, materials,
equipment or reasonable substitutes therefor, acts of God, governmental
restrictions or regulations or controls, judicial orders, enemy or hostile
government actions, civil commotion, fire or other casualty, or other cause
beyond the reasonable control of the party obligated to perform hereunder, shall
excuse performance of the work by that party for a period equal to the duration
of that prevention, delay or stoppage. Nothing in this Article 34 shall excuse
or delay Tenant's obligation to pay Rent or other charges under this
Lease.

34.
CURING
TENANT'S DEFAULTS.

If Tenant
defaults in the performance of any of its obligations under this Lease, Landlord
may (but shall not be obligated to) without waiving such default, perform the
same for the account at the expense of Tenant. Tenant shall pay Landlord all
costs of such performance promptly upon receipt of a bill
therefore.

35.
SIGN
CONTROL.

Landlord
and Tenant shall agree on the signage which Tenant shall have at the Premises
and on the property. The signage agreed upon shall be described in Exhibit “E”
attached hereto. Tenant shall install Tenant’s signs at Tenant’s expense. All of
the signage is subject to Sign Criteria Rules and Regulations determined by the
City of Encinitas, and approval by the City of Encinitas, if required. Apart
from the signage set forth in Exhibit “E”, Tenant shall not affix, paint, erect
or inscribe any sign, lighting, projection, awning, signal or advertisement of
any kind to any part of the Premises, Building or Project, including without
limitation, the inside or outside of windows or doors, without the written
consent of Landlord, which shall not be unreasonably withheld. Landlord shall
have the right to remove any signs or other matter installed without Landlord’s
permission without being liable to Tenant by reason of such removal, and to
charge the cost of removal to Tenant as additional rent hereunder, payable
within ten (10) days of written demand by Landlord. All building signage shall
be illuminated channel cut letters and Tenant shall maintain said sign lighting
in operable condition. In the event the illumination does not work for more than
three (3) at any time, Landlord shall have the right to repair the lighting at
Tenant’s expense.

36.
RENTAL
ADJUSTMENTS.

Notwithstanding
anything to the contrary set forth in Paragraph 5.2 of this lease, during the
initial term of this Lease, the Basic Rent adjustment shall be limited to a
three percent (3%) increase per year over the Base Rent for the immedi-ately
preceding calendar year. 

37.
TAXES
AND OPERATING COSTS.

(a)
Landlord and Tenant acknowledge that this Lease is a "net lease" with respect
to, but not limited to, all utilities, taxes, insurance, janitorial service and
other operating costs and repairs on the Premises, Building and Property as
specifically set forth herein and Landlord shall receive all rents and all
payments hereunder that Tenant is required to make to Landlord free from any
charges, assessments, impositions, expenses, deductions or offsets.

(b)
Tenant shall pay its proportionate share of all real property taxes, city taxes,
license fees and general and special assess-ments or taxes ("Taxes") levied and
assessed against the Building, other improvements and land of the Property of
which the Premises are a part. Tenant's proportionate share shall constitute
additional rent and shall be the ratio of the total number of square feet
occupied by Tenant to the total number of rentable square feet in the Building.

 

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(c) Each
year, Landlord shall notify Tenant of Landlord's calculation of Tenant's
proportionate share of the real property taxes and together with such notice
shall furnish Tenant with a copy of the tax bill. Tenant shall pay its
proportionate share of the real property taxes monthly as a part of the common
area billing as provided herein below. Tenant's liability to pay real property
taxes shall be prorated on the basis of a 365-day year to account for any
fractional portion of a fiscal tax year included in the term at its commencement
and expiration.

(d)
Tenant shall pay to Landlord an amount estimated by Landlord to be Tenant's
share of common area costs, as defined below, on the first day of each month
after commencement of the term and continuing during the term. Tenant's
proportionate share of common area costs shall constitute additional rent and
shall be the ratio of the total number of square feet in the Building and the
other improvements on the Property, which ratio is set forth hereinabove in
Section 2.q and which shall continue as the ratio for the purposes of common
area billing provided that Tenant leases no more space in the Building in
addition to the square footage leased pursuant to the provisions of this lease.
Common area costs that cover a period not within the term of this lease shall be
prorated.

(e)
Landlord can adjust the monthly common area charge up to thirty-five percent
(35%) within one (1) accounting period (calendar year) on the basis of
Landlord's reason-able antici-pated costs.

(f)
Landlord shall furnish to Tenant a statement showing the total common area costs
and Tenant's share of common area costs of the accounting period (a calendar
year), within ninety (90) days after the end of each accounting period, covering
the accounting period just ended.

(g) If
Tenant's share of common area costs for the accounting period exceeds the
payments made by Tenant, Tenant shall pay Landlord the deficiency within ten
(10) days after receipt of the statement. If Tenant's payments made during the
accounting period exceed Tenant's share of common area cost, Landlord shall pay
Tenant the excess at the time Landlord furnishes the state-ment to
Tenant.

(h)
Common area costs include, but are not limited to: Real property taxes and
assessments; other taxes and assessments of any nature levied and assessed
against the common areas or assessed against Landlord as a result of the common
areas which are not otherwise provided for in this lease; all sums expended for
the maintenance and operation of the common area, including but not limited to
costs of resurfacing, painting, and restriping, and structural repair, cleaning,
sweeping, construction and maintenance of refuse receptacles, planting and
relandscaping, directional signs and other markers, car stops, lighting and
other utilities; reasonable depreciation allowance of improvement; management
expenses, maintenance and operation of the building and grounds, machinery and
equipment used in connection with the common areas; premiums on public liability
and property damage insurance; and other costs.

(i)
Landlord may at its option pay the premiums for maintaining the insurance
required by Section 22 hereinabove. Such insurance shall contain terms and
provide coverages as required by Landlord. Tenant shall reimburse Landlord for
Tenant's proportionate share of the premiums paid by Landlord and said
proportionate share shall constitute additional rent. Tenant's proportionate
share of the insurance premiums shall be based upon the ratio of the total
number of rentable square feet in the Building and other improvements in which
the Premises are located.

(j)
Tenant shall pay as additional rent its prorata share thirteen point seventy-six
percent (13.76%) in all triple net (NNN) charges for the building. 

38.
UTILITIES
AND SERVICES.

38.1
Utilities
and HVAC System Charges. Tenant
shall pay for all utilities used by Tenant on the Premises from and after the
date Tenant takes possession of Premises or Commencement Date, whichever is
sooner. If any of Tenant's utilities and/or HVAC system are furnished by
Landlord without separate metering, then during the Term Tenant shall pay as
additional rent, monthly in advance, a utilities charge to reimburse Landlord
for any such utilities furnished by Landlord to the Premises. This utilities
charge shall, at Landlord's election, be established (a) by an estimate of usage
made from time to time by Landlord or the appropriate utility company, and
ini-tially based on Tenant's proposed use of the Premises, or (b) a percentage
of such total utility Costs equal to a fraction, the numerator of which is the
Floor Area of the Premises, and the denominator of which is the Rentable Area of
the Building actually being furnished with utility service by Landlord at the
time of billing. The utilities charge to Tenant hereunder for utilities
furnished by Landlord shall be based on utility rates which do not exceed those
charged by the local public utility company for services it would otherwise
furnish directly to Tenant. If the Premises are not initially separately
metered, Landlord shall have the right, at its expense, to install separate
meters for the Premises at any time during the Term.

38.2
Failure
to Pay. If
Tenant fails to pay any amount due to Landlord hereunder within 10 days after
receipt by Tenant of a bill therefor, Landlord may (in addition to all other
rights and remedies provided herein for breach of this Lease and if permitted by
law) cut off and discontinue, upon 5 days' advance notice to Tenant and
opportunity to cure, any such utilities furnished to the Premises by Landlord
until all such amounts are paid in full.

 

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38.3
No
Landlord Liability.
Landlord shall not be liable in damages or otherwise for any failure or
interruption of any utility service being furnished to the Premises, or
operation of the HVAC system, if any. No such failure or interruption shall
entitle Tenant to terminate this Lease or stop making any Rent or other payments
due hereunder.

39.
OPTION
TO RENEW.

Tenant
shall be granted three (3) three-year options to renew the lease by giving
Landlord at least one hundred eighty (180) days prior written notice of its
intent to exercise each option. The rent for the first year of the option period
shall be at the rate of the last year of the initial lease term plus four
percent (4%). The rate during the remaining years of the first option term shall
increase annually by a fixed four percent (4%). The first year lease rates of
the second and third option terms shall be adjusted to “market rates” with four
percent (4%) increases in each subsequent year of each option. Market shall be
defined as the average rent for comparable space in comparable buildings in a
one-mile radius using at least three (3) lease comps and three (3) available
spaces if available or if there is no vacant space, comparable rent will be
based upon the average rent of four (4) lease transactions. For example, if
there were three (3) comps at $3.00, $3.10 and $3.20 and the available suites at
$3.00, $3.15, and $3.18, the rate would be the average of the six numbers or
$3.11 per square foot. In the event Tenant does not agree with Landlord’s
estimate of market rent, Tenant may propose a lower rent, but nothing shall
obligate Landlord to accept Tenant’s rent if it is less than the rent as
calculated by the formula.

40.
TENANT'S
USE OF HAZARDOUS MATERIAL.
(See
Exhibit “G”)

41.
AUTHORITY.

Tenant
represents and warrants that it is duly formed and in good standing, and has
full corporate or partnership power and authority, as the case may be, to enter
into this Lease and has taken all corporate or partnership action, as the case
may be, necessary to carry out the transaction contemplated herein, so that when
executed, this Lease constitutes a valid and binding obligation enforceable in
accordance with its terms. Tenant shall provide Landlord with corporate
resolutions or other proof in a form acceptable to Landlord, authorizing the
execution of the Lease at the time of such execution.

42.
RIGHT
TO TERMINATE.

This
lease is expressly contingent upon Tenant receiving a charter from the Federal
Government for a Bank Charter. If and only if Tenant is unable to receive said
charter on or before the commencement date of the lease, it shall have the
unilateral right to terminate the lease. In the event of said termination,
Landlord shall retain Tenant’s prepaid monies of $34,701.99 as liquidated
damages to be applied against Landlord’s losses including brokerage commissions,
loss of rents and debt service. In the event the Lease is terminated by Tenant
for its failure to receive its charter, Tenant shall have no recourse or rights
against Landlord for any reason.

43.
MISCELLANEOUS.

a.
Accord
and Satisfaction; Allocation of Payments. No
payment by Tenant or receipt by Landlord of a lesser amount than the Rent
provided for in this Lease shall be deemed to be other than on account of the
earliest due Rent, nor shall any endorsement or statement on any check or letter
accompanying any check or payment as Rent be deemed an accord and satisfaction,
and Landlord may accept such check or payment without prejudice to Landlord's
right to recover the balance of the Rent or pursue any other remedy provided for
in this Lease. In connection with the foregoing, Landlord shall have the
absolute right in its sole discretion to apply any payment received from Tenant
to any account or other payment of Tenant then not current and due or
delinquent.

b.
Attorneys'
Fees. If any
action or proceeding is brought by either party against the other pertaining to
or arising out of this Lease, the finally prevailing party shall be entitled to
recover reasonable attorneys' fees and costs, incurred on account of such action
or proceeding.

c.
Captions,
Articles and Section Numbers. The
captions appearing within the body of this Lease have been inserted as a matter
of convenience and for reference only and in no way define, limit or enlarge the
scope or meaning of this Lease. All references to Article and Section numbers
refer to Articles and Sections in this Lease.

d.
Changes
Requested by Lender. Neither
Landlord or Tenant shall unreasonably withhold its consent to changes or
amendments to this Lease requested by the lender on Landlord's interest, so long
as these changes do not alter the basic business terms of this Lease or
otherwise materially diminish any rights or materially increase any obligations
of the party from whom consent to such charge or amendment is
requested.

e.
Choice
of Law. This
Lease shall be construed and enforced in accordance with the laws of the State
of California. The venue shall be San Diego County Superior Court North County
District.

f.
Consent.
Notwithstanding anything contained in this Lease to the contrary, Tenant shall
have no claim, and hereby waives the right to any claim against Landlord for
money damages by reason of any refusal, withholding or delaying by Landlord of
any consent, approval or statement of satisfaction, and in such event, Tenant's
only remedies therefor shall be an action for specific performance, injunction
or declaratory judgment to enforce any right to such consent, etc.

 

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g.
Corporate
Authority. If
Tenant is a corporation, each individual signing this Lease on behalf of Tenant
represents and warrants that he is duly authorized to execute and deliver this
Lease on behalf of the corporation, and that this Lease is binding on Tenant in
accordance with its terms. Tenants shall, at Landlord's request, deliver a
certified copy of a resolution of its board of directors authorizing such
execution.

h.
Counterparts. This
Lease may be executed in multiple counterparts, all of which shall constitute
one and the same Lease.

i.
Execution
of Lease, No Option. The
submission of this Lease to Tenant shall be for examination purposes only, and
does not and shall not constitute a reservation of or option for Tenant to
lease, or otherwise create any interest of Tenant in the Premises or any other
Premises within the Building or Project. Execution of this Lease by Tenant and
its return to Landlord shall not be binding on Landlord notwithstanding any time
interval, until Landlord has in fact signed and delivered this Lease to
Tenant.

j.
Further
Assurances. The
parties agree to promptly sign all documents reasonably requested to give effect
to the provisions of this Lease.

k.
Mortgagee
Protection. Tenant
agrees to send by certified or registered mail to any first mortgagee or first
deed of trust beneficiary of Landlord whose address has been furnished to
Tenant, a copy of any notice of default served by Tenant on Landlord. If
Landlord fails to cure such default within the time provided for in this Lease,
such mortgagee or beneficiary shall have an additional thirty (30) days to cure
such default; provided that if such default cannot reasonably be cured within
that thirty (30) day period, then such mortgagee or beneficiary shall have such
additional time to cure the default as is reasonably necessary under the
circumstances.

l.
Prior
Agreements; Amendments. This
Lease contains all of the agreements of the parties with respect to any matter
covered or mentioned in this Lease, and no prior agreement or understanding
pertaining to any such matter shall be effective for any purpose. No provisions
of this Lease may be amended or added to except by an agreement in writing
signed by the parties or their respective successors in interest.

m.
Recording. Tenant
shall not record this Lease without the prior written consent of Landlord.
Tenant, upon the request of Landlord, shall execute and acknowledge a "short
form" memorandum of this Lease for recording purposes.

n.
Severability. A final
determination by a court of competent jurisdiction that any provision of this
Lease is invalid shall not affect the validity of any other provision, and any
provision so determined to be invalid shall, to the extent possible, be
construed to accomplish its intended effect.

o.
Successors
and Assigns. This
Lease shall apply to and bind the heirs, personal representatives, and permitted
successors and assigns of the parties.

p.
Time
of the Essence. Time is
of the essence of this Lease.

q.
Waiver. No
delay or omission in the exercise of any right or remedy of Landlord upon any
default by Tenant shall impair such right or remedy or be construed as a waiver
of such de-fault.

r.
Landlord represents that all equipment and services fur-nished by it under the
lease are "year 2000 compliant" as to any computer operations connected with
them, including the HVAC, security, parking and card access. Landlord shall
correct within thirty (30) days any "year 2000" problems which may arise under
the lease. If Landlord shall not correct the problem within thirty (30) days,
Tenant shall have the right to correct the problem at Landlord's
expense.

The
receipt and acceptance by Landlord of delinquent Rent shall not constitute a
waiver of any other default; it shall constitute only a waiver of timely payment
for the particular Rent payment involved.

No act or
conduct of Landlord, including, without limitation, the acceptance of keys to
the Premises, shall constitute an acceptance of the surrender of the Premises by
Tenant before the expiration of the Term. Only a written notice from Landlord to
Tenant shall constitute acceptance of the surrender of the Premises and
accomplish a termination of the Lease.

Landlord's
consent to or approval of any act by Tenant requiring Landlord's consent or
approval shall not be deemed to waive or render unnecessary Landlord's consent
to or approval of any subsequent act by Tenant.

Any
waiver by Landlord of any default must be in writing and shall not be a waiver
of any other default concerning the same or any other provision of the
Lease.

 

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18

The
parties hereto have executed this Lease as of the dates set forth
below.

 

	LANDLORD	 	
      TENANT
	 
	 	 	 	 
	
      Date:
		
      Date:
	
	
       

      Landlord:
	
       

      Garden
      View Professional Center, LLC
	
       

      Tenant:
	
       

      Western
      Pacific Bancorp, Inc.

	 	 	 	 
	
      By:
	 	
      By:
	 
	 	
      Joseph
      C. Sanford
	 	
      Michael
      S. Hahn

	
      Title:
	
      Managing
      Member
	
      Title:
	
      President
      / Organizer

	 	 	 	 
	
      Address:
	
      c/o
      CMC, Inc.

      P.O.
      Box 636

      Vista,
      CA 92085
	
      Address:
	
      499
      North El Camino Real

      Suite
      C-100

      Encinitas,
      CA 92024-1302

	 	 	 	 
	
      Phone:
	
      760.727.5794
	
      Phone:
	
      760.798.9507

CONSULT
YOUR ADVISORS - This document has been prepared for approval by your attorney.
No representation or recommendation is made as to the legal sufficiency or tax
consequences of this document or the transaction to which it relates. These are
questions for your attorney.

In any
real estate transaction, it is recommended that you consult with a professional,
such as a civil engineer, industrial hygienist or other person, with experience
in evaluating the condition of the property, including the possible presence of
asbestos, hazardous materials and underground storage tanks.

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

19

EXHIBIT
“A”

“Premises”

 

 

 

 

 

 

 

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

20

EXHIBIT
“B”

“Site
Plan”

 

 

 

 

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

21

EXHIBIT
“C”

“Parking
and Common Areas”

1.1
Demised Premises: Landlord hereby leases to Tenant and Tenant hereby hires from
Landlord the Premises described in Article 1.

1.2 Open
Parking: Tenant shall be permitted to park standard size passenger automobiles
specified in Article k of Section 2 on an unreserved monthly basis in the
surface parking facilities which comprise a portion of the Plaza. (See site
plan, Exhibit B.) Landlord may at any time in its sole discretion amend or
modify Tenant's parking privileges as set out in site plan, Exhibit B hereof.
Tenant agrees to abide by any and all parking regulations and rules as are or
may at any time be established by Landlord or Landlord's parking operator
including, but not limited to, requiring payment by Tenant to Landlord or
Landlord's parking operator for any and all loss (including but not limited to
loss of parking-entrance key cards, if any) or other damage caused by Tenant or
Tenant's agents, servants, employees, or licensees occurring during or relating
to the use of the parking privileges set forth herein. Landlord may refuse the
parking privileges provided herein to any person who violates such regulations
and rules, and upon any impound, garage at Tenant's cost. Parking spaces shall
be solely for the accommodation of Tenant and Tenant expressly agrees that
Landlord assumes no responsibility of any kind whatsoever with reference to such
automobile parking areas or the use thereof by Tenant, its agents, servants,
employees, contractors, visitors or licensees. No other method of visitor
parking validation may be used, unless expressly approved by Landlord in
writing. Landlord shall not charge for parking privileges.

1.3
Exclusive Parking: Tenant shall have six (6) exclusive parking spaces as shown
on attached Exhibit “B”.

1.4
Common Areas: Tenant shall have the nonexclusive right, in common with others,
to the use of common entrances, lobbies, elevators, ramps, drives, bridgeways,
stairs and similar access and serviceways and common areas in and adjacent to
the Building, subject to such nondiscriminatory rules and regulations as may
from time to time be adopted by Landlord.

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

22

EXHIBIT
"D"

“Rules
And Regulations”

THE
GARDEN VIEW PROFESSIONAL BUILDING

1. The
sidewalks, entrances, passages, courts, elevators, vestibules, stairways,
corridors or halls shall not be obstructed or used for any purposes other than
ingress or egress.

2. No
awnings or other projections shall be attached to the outside walls of any
building in the Plaza. No curtains, blinds, shades or screens shall be attached
to or hung in, or used in connection with, any window or door of the Premises
other than as approved by Landlord. All electric ceiling fixtures hung in office
or spaces along the perimeter of any building in the Plaza must either be
fluorescent or of a quality, type, design and bulb color approved by Landlord.
Neither the interior nor exterior of any windows shall be coated or otherwise
sunscreened without the consent of Landlord.

3. Except
as to the signage provisions of Section 36 of the Lease, no sign, advertisement,
notice or other lettering shall be exhibited, painted or affixed by any Tenant
on any part of the Premises or the Plaza without the prior consent of Landlord.
In the event of the violation of the foregoing by any Tenant, Landlord may
remove same without any liability, and may charge the expense incurred in such
removal to such Tenant violating this rule. Interior signs or doors and the
directory tablet shall be inscribed, painted or affixed for each Tenant by
Landlord at the expense of such Tenant, and shall be of a size, color and style
designed Building Standard by Landlord. The directory tablet will be provided
exclusively for the display of the name and location of Tenants only and
Landlord reserves the right to exclude any other names therefrom. No business
card or notifications or the like may be affixed to the directory. Nothing may
be placed on the exterior walls or doors other than Landlord's standard
lettering.

4. The
sashes, sash doors, skylights, windows, and doors that reflect or admit light
and air into halls, passageways or other public places in the Plaza shall not be
covered or obstructed by any Tenant, nor shall any bottles, parcels or other
articles be placed on the window sills or in the public portions of the Building
or the Plaza.

5. The
water and wash closets and other plumbing fixtures shall not be used for any
purpose other than those for which they were constructed, and no sweepings,
rubbish, rags, coffee grounds or other substances shall be thrown therein. All
damages resulting from any misuse of the fixtures shall be born by Tenant, who
or whose servants, employees, contractors, agents, visitors or licensees, shall
have caused the same.

6. Except
as to the installation of tenant improvements, no Tenant shall mark, paint,
drill into, or in any way deface any part of the Premises, the Building or the
Plaza. No boring, cutting or stringing of wires or laying of hard surface or
other similar floor coverings shall be permitted, except with the prior consent
of Landlord as Landlord may direct, which consent shall not be unreasonably
withheld.

7. No
bicycles, vehicles, birds or animals of any kind shall be brought into or kept
in or about the Premises, and no cooking shall be done or permitted by any
Tenant except that the prepa-ration of coffee, tea, hot chocolate and similar
items for Tenants and their employees shall be permitted provided power shall
not exceed that amount which can be provided by a 30 amp circuit. No Tenant
shall cause or permit any unusual or objectionable odors to be produced in the
Premises nor to permeate the building or the Plaza.

8. The
Premises shall not be used for manufacturing or the storage of merchandise
except as such storage may be incidental to the use of the Premises set forth in
the lease. Tenant shall not occupy or permit any portion of the Premises to be
occupied as an office for a public stenographer or typist, or for the
manufacturer or sale of liquor, narcotics, or tobacco in any form or as a barber
or manicure shop, or as an employment bureau. No Tenant shall engage or pay any
employees on the Premises except those actually working for such Tenant on the
Premises nor advertise for laborers giving an address at the Premises. The
Premises shall not be used for lodging or sleeping or for any immoral or illegal
purposes.

9. No
Tenant shall make, or permit to be made, any unseemly or disturbing noises or
disturb or interfere with occupants of the Plaza or neighborhood buildings or
premises or those having business with them, whether by the use of any musical
instrument, radio, phonograph, unusual noise, or any other way. No Tenant shall
throw anything out of doors, windows or skylights or down the
passageways.

10. No
Tenant nor any of Tenant's servants, employees, agents, contractors, visitors or
licensees, shall at any time bring or keep upon the Premises, the Building or
the Plaza any inflammable, combustible or explosive chemical substances or
fluids.

11. No
additional locks or bolts of any kind shall be placed upon any of the doors or
windows by any Tenant, nor shall any changes be made in existing locks or the
mechanism thereof. Each Tenant must, upon the termination of its tenancy,
restore to Landlord all keys of stores, offices, stairways and toilet rooms,
either furnished to, or otherwise procured by such Tenant and in the event of
the loss of any keys so furnished, such Tenant shall pay to Landlord the cost of
replacing the same or of changing the lock or locks opened by such lock key if
Land-lord shall deem it necessary to make such change.

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

 

23

12. All
removals, the carrying in or out of any safes, freight, furniture, or bulky
matter of any description or the use of the elevators in the Building and/or the
Plaza must take place between the hours of 9:00 to 11:30 a.m. and 1:30 to 4:15
p.m. Monday through Friday (exclusive of holidays). The moving of sofas, other
fixtures, equipment or bulky matter of any kind must be made upon previous
notice to the manager of the Plaza, in a manner and at times prescribed by him
and under his supervision, and the person employed by any Tenant for such work
must be acceptable to Landlord. Landlord reserves the right to inspect all
safes, freight or other bulky articles to be brought into the Plaza and to
exclude from the Plaza all safes, freight or bulky articles which violate any of
the Rules and Regulations or the lease of which these Rules and Regulations are
a part. Landlord reserves the right to prescribe the weight and position of all
safes, which must be placed upon supports approved by Landlord to distribute
weight. If additional expenses are incurred by Landlord by reason of moving of
Tenant's safes, other fixtures, equipment or bulky matter of any kind, such
expenses shall be borne by Tenant.

13. No
Tenant shall purchase janitorial or maintenance or other like services from any
company or persons not approved by Landlord, which approval by Landlord shall
not be unreasonably withheld.

14.
Tenant shall not advertise or conduct business in a manner, which tends to
impair the reputation of the Plaza or its desir-ability as a first class office
building.

15.
Landlord reserves the right to exclude from the Plaza on Mondays through Fridays
between the hours of 7:00 p.m. and 7:00 a.m. and at all hours on Saturdays,
Sundays and legal holidays all persons who have not received clearance as a
result of a written request from Tenant or who do not present a pass to the
Plaza signed by Landlord. Landlord will furnish passes or, at Landlord's option,
clearances, to persons for whom any Tenant requests the same in writing. Each
Tenant shall be responsible for all persons for whom he requests passes
clearances and shall be liable for damages for any error with regard to the
admission to or to the exclusion from the Plaza of any person. In case of an
invasion, mob riot, public excitement or other circumstances rendering such
action advisable in landlord's opinion, Landlord reserves the right to prevent
access to the Plaza during the continuance of the same by closing the doors or
otherwise, for the safety of Tenants and the protection of the Plaza and the
property in the Plaza.

16. Any
persons employed by any Tenant to do janitor work, shall, while in the Plaza and
outside of the Premises, be subject to and under the control and direction of
the Tenant, and Tenant shall be responsible for all acts of such
persons.

17. All
doors opening onto public areas shall be kept closed, except when in use for
ingress or egress.

18. The
requirements of Tenants will be attended to only upon application to the Office
of the Plaza. Plaza personnel shall not perform any work or do anything outside
of their regular duties, unless under special instructions from the office of
the Landlord.

19.
Canvassing, soliciting and peddling in the Plaza are prohibited and each Tenant
shall cooperate to prevent the same.

20. All
office equipment of any electrical or mechanical nature shall be placed by
Tenant in the Premises in settings approved by Landlord to absorb or prevent any
vibrations, noise or annoyance.

21. No
electric heaters, air conditioning unit or other similar apparatus shall be
installed or used by any Tenant without the consent of the Landlord.

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

24

EXHIBIT
"E"

“Signage”

 

Tenant
shall be allowed signage, at its expense, in seven (7) locations at the property
to include the following:

	1.  	
      Building
      directory located at the southeast corner of Building
  ‘A’.

	2.  	
      Building
      directory located on the north side of Building
‘A’.

	3.  	
      Building
      directory located in the lobby of Building ‘C’ and Tenant’s entrance to
      its suite.

	4.  	
      Customer
      parking signs on six (6) spaces adjacent to the
  Premises.

	5.  	
      Building
      signage at N-7 as per attached specifications, not to exceed sixteen (16)
      square feet.

	6.  	
      Building
      signage at W-1 as per attached specifications, not to exceed thirty-four
      (34) square feet.

Tenant
shall obtain Landlord’s prior written approval of the proposed signage, which
approval shall not be unreasonably withheld. Signage shall conform to criteria
of all applicable governmental agencies. Tenant shall obtain all necessary
approvals of the signage from the City of Encinitas.

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

25

EXHIBIT
"E-1"

 

 

 

 

 

 

 

 

26

EXHIBIT
"E-2"

 

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

 

27

EXHIBIT
"E-3"

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

28

EXHIBIT
"E-4"

 

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

29

EXHIBIT
"E-5"

 

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

30

EXHIBIT
"E-6"

 

 

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

 

31

EXHIBIT
"E-7"

 

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

 

32

EXHIBIT
"E-8"

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

33

EXHIBIT
"F"

“Estimated
Monthly Operating Expenses To Be Paid By Tenant”

Revised
September, 2003

FIRST
YEAR ESTIMATED OPERATING EXPENSES FOR

THE
GARDEN VIEW PROFESSIONAL BUILDING

 

	ITEM
	 	
      ANNUAL
      EXPENSES
	 
	 	 	 	 
	
      Property
      Taxes
	 	
      $
	
      47,560.00
	 
	
      Property
      Insurance
	 	
      $
	
      5,810.00
	 
	
      Landscape
      Maintenance
	 	
      $
	
      7,620.00
	 
	
      Trash
	 	
      $
	
      4,455.00
	 
	
      Property
      Management
	 	
      $
	
      19,200.00
	 
	
      Water
      and Sewer
	 	
      $
	
      3,130.00
	 
	
      Security
      and Alarms
	 	
      $
	
      2,400.00
	 
	
      Telephone
	 	
      $
	
      600.00
	 
	
      Pest
      Control
	 	
      $
	
      900.00
	 
	
      Repairs
	 	
      $
	
      3,000.00
	 
	
      Elevator
      Maintenance/Elevator Repairs/Elevator Phones
	 	
      $
	
      3,915.00
	 
	
      Lighting
	 	
      $
	
      2,735.00
	 
	
      Cleaning
      and Maintenance
	 	
      $
	
      4,630.00
	 
	
      Interior
      Plant Care
	 	
      $
	
      1,500.00
	 
	
      Common
      Area Electric
	 	
      $
	
      7,030.00
	 
	
      Other
      Expenses
	 	
      $
	
      1,000.00
	 
	
      Total
      Annual Expense
	 	
      $
	
      115,485.00
	 
	
      Annual
      Pro-Rata Share for Tenant - 13.76%

      (total
      project area = 31,144 square feet)
	 	
      $
	
      15,891.00
	 

 

Monthly
operating expenses are due at the same time as Base Rent and a late charge of
six percent (6%) shall apply to any unpaid amounts not received by Landlord
within ten (10) days after such amount shall be due.

The above
operating expenses are estimates only and the actual expenses will be higher for
subsequent years due to increases in taxes and other items. Landlord shall
deliver to Tenant within ninety (90) days after December 31 of each year
(starting in 2004) a reasonably detailed statement showing the actual operating
expenses incurred during the preceding twelve (12) months. If Tenant’s payments
under this section during said preceding twelve (12) month period exceeds
Tenant’s share as indicated on said statement, Tenant shall be entitled to
credit the amount of such overpayment against installments of Base Rent and
Tenant’s share of operating expenses next falling due. If Tenant’s payments
under this paragraph during said preceding twelve (12) month period were less
than Tenant’s share as indicated on said statement, Tenant shall pay to Landlord
the amount of the deficiency within ten (10) days after delivery by Landlord to
Tenant of said statement. Any overpayment during the last year of the term shall
be promptly returned to Tenant.

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

 

34

EXHIBIT
“G”

“Hazardous
Materials”

 

(1) PROHIBITION
OF STORAGE: Tenant shall not cause or permit any Hazardous Material to be
brought upon, kept or used in or about the Premises by Tenant, its agents,
employees, contractors or invitees, other than those expressly permitted by
Landlord and identified below. If Tenant breaches the obligation stated in the
preceding sentence, or if the presence of Hazardous Materials on the Premises
caused or permitted by Tenant (including Hazardous Materials specifically
permitted and identified below) results in contamination of the Premises, or if
contamination of the Premises by Hazardous Material otherwise occurs for which
tenant is legally liable to Landlord for damage resulting therefrom, then Tenant
shall indemnify, defend and hold Landlord, its agents and contractors harmless
from any and all claims, judgments, damages, penalties, fines, costs,
liabilities, or losses (including without limitation diminution in value of the
premises or any portion of the property surrounding the Premises (the “Adjacent
Property”), damages for the loss or restriction on use of rentable or usable
space or of any amenity of the Premises, damages arising from any adverse impact
on marketing of space in the Premises or the Adjacent Property, and sums paid in
settlement of claims, attorney’s fees, consultant fees and expert (fees) which
arise during or after the Lease Term as a result of such contamination. This
indemnification of Landlord by Tenant includes, without limitation, costs
incurred in connection with any investigation of site conditions or any cleanup,
remedial, removal, or restoration work required by any federal, state or local
governmental agency or political subdivision because of Hazardous Material
present in the soil or ground water on or under the Premises. Without limiting
the foregoing, if the presence of any Hazardous Material on the Premises caused
or permitted by Tenant results in the contamination of the Premises, Tenant
shall promptly take all actions as condition existing prior to the introduction
of any such Hazardous Material to the Premises, provided that Landlord’s
approval of such action shall first be obtained, which approval shall not be
unreasonably withheld so long as such actions would not potentially have any
material adverse long-term or short-term affect on the Premises or the Adjacent
Property.

(2) TERMINATION
OF LEASE: Notwithstanding the provisions of Paragraph (1) above, if (I) any
anticipated use of the Premises by Tenant or any proposed assignee or subtenant
of Tenant involves generation, storage, use, treatment or disposal of Hazardous
Material, (ii) Tenant or the proposed assignee or subtenant has been required by
any prior Landlord, lender or governmental authority to take remedial action in
connection with hazardous Material contaminating a property if the contamination
resulted from such party’s action or use of the property in questions, or (iii)
Tenant or the proposed assignee or subtenant is subject to an enforcement order
issued by any governmental authority in connection with the use, disposal, or
storage of Hazardous Material, Landlord shall have the right to terminate the
Lease in Landlord’s sole and absolute discretion (with respect to any such
matter involving Tenant) and it shall not be unreasonable for Landlord to
withhold its consent to any proposed assignment or subletting (with respect to
any such matter involving a proposed assignee or subtenant).

(3) DEFINITION
OF “HAZARDOUS MATERIAL”: As used herein, the term “Hazardous Material” means any
hazardous or toxic substance, material or waste which is or becomes regulated by
any local governmental authority, the State of California or the United States
Government. The term “Hazardous Material” includes, without limitation, any
material or substance which is (I) defined as “hazardous waste”, “extremely
hazardous waste” or “restricted hazardous waste” under Section 25115, 25117 or
25122.7 or listed pursuant to Section 25140, of the California Health and Safety
Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law), (ii) defined as a
“hazardous substance” under Section 25316 of the California Health and Safety
Code, Chapter 6.8 (Carpenter-Presly-Tanner Hazardous Substances Account Act),
(iii) defined as a “hazardous material”, “hazardous substance” or “hazardous
waste” under Section 25501 of the California Health and Safety Code, Division
20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory),
(iv) defined as a “hazardous substance” under Section 25281 of the California
Health and Safety Code, Division 20, Chapter 6.7 underground Storage of
Hazardous Substances), (v) petroleum, (vi) asbestos, (vii) listed under Article
9 and defined as hazardous or extremely hazardous pursuant to Article 11 of
Title 22 of the California Administrative Code, Division 4, Chapter 20 (viii)
designated as a “hazardous substance” pursuant to Section 311 of the Federal
Water Pollution Control Act (33 U.S.C. Section 1317), (ix) defined as a
“hazardous waste” pursuant to Section 1004 of the Federal Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901 et seq. (42 U.S.C. Section 6903), or
(x) defined as a “hazardous substance” pursuant to Section 101 of the
Comprehensive Environmental Response Compensation and Liability Act, 42 U.S.C.
Section 9601 et seq. (42 U.S.C. Section 9601).

(4) INSPECTIONS:
Tenant shall deliver to landlord, within fifteen (15) days of receipt, copies of
all inspection reports by the Health Department, Fire Department and other
governmental agencies which inspected the Premises for compliance with
governmental standards concerning health, safety or hazardous waste. Tenant, at
Landlord’s request, shall have an environmental inspection performed by an
environmental inspector mutually selected by Landlord and Tenant, pursuant to a
scope of work mutually agreed by Landlord and Tenant. Tenant shall deliver to
landlord a copy of the inspection report within fifteen (15) days from its
receipt by Tenant. The cost of the inspection shall be paid by Tenant if the
report requires Tenant to take corrective action. Otherwise, Landlord shall pay
for the cost of inspection.

(5) NOTICE:
Tenant shall give immediate written notice to Landlord of:

(i) Any
action, proceeding or inquiry by any governmental authority with respect to the
presence of any Hazardous Substance on the Property or the migration thereof
from or to other property;

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

 

35

 

(ii) All
demands or claims made or threatened by any third party against Tenant or the
Property relating to any loss or injury resulting from any Hazardous
Substances;

(iii) Any
spill, release, discharge or non-routine disposal of Hazardous Substances that
occurs with respect to the Property or Tenant’s operations;

(iv) All
matters of which Tenant is required to give notice of pursuant to Section
25359.7 of the California Health and Safety code; and

(v)
Tenant’s discovery of any occurrence or condition on, under or about the
Property or any real property adjoining or in the vicinity of the Property or
any part thereof to be subject to any restrictions on the ownership, occupancy,
transferability or use of the Property under any Environmental Law.

Should
any spill, release, discharge or non-routine disposal of Hazardous Substances
appear to occur, or should Tenant discover any occurrence or condition under or
on or about the Property or any part thereof to be subject to possible violation
of any environmental law, Tenant’s legal counsel shall be so advised and shall
promptly notify Landlord of the existence of an event that the Landlord should
investigate. It is agreed that the attorney-client privilege shall not be
violated. Nevertheless, Tenant shall give adequate notice to Landlord such that
Landlord may conduct its own investigation to protect Landlord’s
interest.

Landlord
shall have the right to join and participate in, as a party if it so elects, any
legal proceedings or actions affecting the Property initiated in connection with
any Environmental Law and have its attorney’s fees in connection therewith paid
by Tenant should the Tenant be found to have violated any law or provision of
this Lease.

(6) TENANT
INDEMNIFICATION: Tenant hereby agrees to indemnify, defend, and hold harmless
Landlord, its agents, employees, lenders and ground Landlord, if any, from and
against any and all liabilities, loss of rent, damages, penalties, judgments,
claims and costs (including reasonable attorneys’ and consultants’ fees and
costs), arising out of or resulting from (I) Tenant’s use of the Premises during
the Term of the Lease, (ii) any Hazardous Substance that is brought onto the
premises by Tenant, or an agent of Tenant, during the Term of the Lease
provided, however, that Tenant shall have no liability under this Lease with
respect to underground migration of any Hazardous Substance under the Premises
from adjacent properties) or (iii) the violation of any federal, state or local
law, ordinance or regulation by Tenant, its agents or employees, occurring or
allegedly occurring with respect to the Premises during the Term of the Lease.
If appropriate, Tenant’s obligations shall include, but not be limited to, the
effects of any contamination or injury to person, property or environment
created by Tenant, and the cost of investigation, removal, remediation,
restoration and/or abatement. Tenant’s obligations shall survive the expiration
or termination of this Lease. No termination, cancellation, or release agreement
entered into by Landlord and Tenant shall release Tenant from its obligations
under this Lease with respect to Hazardous Substances, unless specifically so
agreed by Landlord in writing at the time of such agreement.

(7) DEFAULT:
Tenant’s failure to observe or perform any of the covenants, conditions or
provisions of this Exhibit “G” to be observed or performed by Tenant shall
constitute a default and breach of this Lease.

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

36

EXHIBIT
“H”

“Tenant
Information and Management Information”

Tenant’s
Name:_____________________________________________________________________________________

Business
Type:_____________________________________________________________________________________

Corporation__________________ 
(Please
fill out additional Corporation Section).

Partnership__________________ 
(Please
fill out additional Partnership Section).

Limited
Liability Company_____________  (Please
fill out additional L.L.C. Section).

Sole
Proprietorship__________  (Please
fill out additional Sole Proprietorship Section).

Corporate
Section:

State of
Incorporation:________________________________________________________________________________

President:__________________________________________________________________________________________

Vice
President:_______________________________________________________________________________________

Secretary:___________________________________________________________________________________________

Corporate
Address:____________________________________________________________________________________

 

Phone:_____________________________________                                             
Fax:__________________________________

E-Mail
Address:_______________________________________________________________________________________

Emergency
Contact:____________________________________________________________________________________

Nighttime
and Weekend
Phone:___________________________________________________________________________

Partnership
Section: 

Type of
Partnership: General___________     Limited___________

General
Partners:______________________________________________________________________________________

1)__________________________________________________________________________________________________

2)__________________________________________________________________________________________________

Partnership
Address:___________________________________________________________________________________

 

Phone:________________________________________                                  
Fax:____________________________________

E-Mail
Address:_______________________________________________________________________________________

Emergency
Contact:____________________________________________________________________________________

Nighttime
and Weekend
Phone:___________________________________________________________________________

Limited
Liability Company
Section:_________________________________________________________________________

Members:

1)__________________________________________________________________________________________________

2)__________________________________________________________________________________________________

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

37

 

Mailing
Address:_____________________________________________________________________________________ 

 

Sole
Proprietorship Section:

Business
Owner:_____________________________________________________________________________________

Home
Address:______________________________________________________________________________________

Home
Phone:________________________________________________________________________________________

Property
Management Contacts:

Commercial
Management Consultants, Inc.

	
      1.
	
      For
      daily maintenance issues: 
	
      Lucy
      Dell
	
      760/632-8500

	
      2.
	
      For
      billing or financial issues:
	
      Susan
      Currey
	
      760/727-5794

	
      3.
	
      For
      lease issues or emergency:
	
      Chuck
      Currey
	
      760/438-7233

Thank you
for your assistance in completing this form.

__________________________________________              
____________________________________

Preparer                                                                                                                    
Date

 

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      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

38

EXHIBIT
"I"

“ATM
Location”

 

 

 

 

 

	Landlord	  
      		Landlord 	   
      	 	 	Tenant	   
      	 	Tenant	   
      

 

 

39VOTING AGREEMENT

                          CADENCE RESOURCES CORPORATION
                               BOARD OF DIRECTORS

<PAGE>

                                TABLE OF CONTENTS

1. Voting Agreement..........................................................1
   1.1  Board Composition....................................................1
   1.2  Size of the Board....................................................2
   1.3  Removal of Board Members.............................................2

2. Term......................................................................2

3. Specific Enforcement......................................................2

4. Miscellaneous.............................................................2
   4.1  Transfers, Successors and Assigns....................................2
   4.2  Governing Law........................................................3
   4.3  Counterparts; Signatures.............................................3
   4.4  Titles and Subtitles.................................................3
   4.5  Notices..............................................................3
   4.6  Amendment............................................................3
   4.7  Severability.........................................................3
   4.8  Delays or Omissions..................................................4
   4.9  Entire Agreement.....................................................4
   4.10 Legend on Share Certificates.........................................4
   4.11 Execution by the Company.............................................4
   4.12 Stock Splits, Stock Dividends, Etc...................................4
   4.13 Covenants of the Company.............................................4
   4.14 Manner of Voting; Grant of Proxy.....................................5
   4.15 Costs of Enforcement.................................................5
   4.16 Additional Investors.................................................5
   4.17 Spousal Consent......................................................5

Schedule A  -  Key Holders
Schedule B  -  Investors

Exhibit 1   -  Adoption Agreement
Exhibit 2   -  Consent of Spouse

                                       i
<PAGE>

                                VOTING AGREEMENT

      THIS VOTING AGREEMENT (the "AGREEMENT") is made and entered into effective
as of this [__] day of __________________, 2005, by and among Cadence Resources
Corporation, a Utah corporation (the "COMPANY"), and the stockholders of the
Company and holders of proxies to vote the capital stock of the Company listed
on Schedule A hereto, together with any transferees who become subject to the
provisions of this Agreement pursuant to Section 4.1 (collectively, the
"STOCKHOLDERS"). The Company and the Stockholders are individually referred to
in this Agreement as a "PARTY" and are collectively referred to in this
Agreement as the "PARTIES."

                                    RECITALS:

      A. Concurrently with the execution of this Agreement, Aurora Energy, Ltd.,
a Nevada corporation ("Aurora") is merging with Aurora Acquisition Corp, a
Nevada corporation and wholly owned subsidiary of the Company ("ACQUISITION
SUB"), pursuant to which Aurora will become a wholly owned subsidiary of the
Company (the "MERGER"). Aurora shareholders will exchange their Aurora common
stock for Cadence common stock as a part of the merger.

      B. As a part of the Merger closing, certain key stockholders of the
Company are issuing proxies to representatives of Aurora, to facilitate
implementation of the agreement of the parties that Aurora's management team
will manage the Company from the effective date of the Merger forward, replacing
the Company's previously existing management. The proxies are to remain in
effect for a period of 36 months.

                                   AGREEMENT:

            NOW, THEREFORE, in consideration of the foregoing and the mutual
promises contained herein, the Parties agree as follows:

      1. VOTING AGREEMENT.

            1.1 BOARD COMPOSITION. Each Stockholder agrees to vote all of
Stockholder's shares of voting securities in the Company, whether now owned or
hereafter acquired or which Stockholder may be empowered to vote by proxy or
otherwise (collectively, the "SHARES"), from time to time and at all times, in
whatever manner shall be necessary to ensure that at each annual or special
meeting of stockholders of the Company at which an election of directors is held
or pursuant to any written consent of the stockholders of the Company, the
following persons shall be elected to serve on the Company's Board of Directors:

                  (a) Five directors designated by William W. Deneau ("W.
DENEAU"), who shall initially be William W. Deneau, Earl V. Young, Gary J.
Myles, Richard Deneau, and Ronald E. Huff; and

                  (b) Two directors designated by W. Deneau from among the
Company's Board of Directors immediately before closing of the Merger, who shall
initially be Howard Crosby and Kevin Stulp.

                                       1
<PAGE>

            1.2 SIZE OF THE BOARD. Each Stockholder agrees to vote all of
Stockholder's Shares from time to time and at all times, in whatever manner
shall be necessary to ensure that the size of the Board shall be set and remain
at seven directors.

            1.3 REMOVAL OF BOARD MEMBERS. Each Stockholder also agrees to vote
all of the Stockholder's Shares from time to time and at all times in whatever
manner as shall be necessary to ensure that (i) no director elected pursuant to
Section 1.1 may be removed from office unless (A) the removal is directed or
approved by the affirmative vote of the person or entity entitled under Section
1.1 to designate that director, or (B) the person or entity originally entitled
to designate or approve the director pursuant to Section 1.1 is no longer so
entitled to designate or approve the director; and (ii) any vacancies created by
the resignation, removal or death of a director elected pursuant to Section 1.1
shall be filled pursuant to the provisions of Section 1.1. Each Stockholder
agrees to execute any written consents required to effectuate the obligations of
this Agreement, and the Company agrees at the request of any Party entitled to
designate directors, to call a special meeting of stockholders for the purpose
of electing directors or to initiate an election by written consent.

      2. TERM. This Agreement shall continue in effect until and shall terminate
on the earlier of 36 months after its effective date or the date of W. Deneau's
death.

      3. SPECIFIC ENFORCEMENT. Each Party acknowledges and agrees that the other
Parties will be irreparably damaged if any of the provisions of this Agreement
are not performed by the Parties in accordance with their specific terms or are
otherwise breached. Accordingly, it is agreed that each of the Company and the
Stockholders are entitled to obtain an injunction to prevent breaches of this
Agreement and to specific enforcement of this Agreement and its terms and
provisions in any action instituted in any court of the United States or any
state having subject matter jurisdiction, in addition to any other remedy to
which the Parties may be entitled at law or in equity.

      4. MISCELLANEOUS.

            4.1 TRANSFERS, SUCCESSORS AND ASSIGNS.

                  (a) The terms and conditions of this Agreement shall inure to
the benefit of and be binding upon the respective successors and assigns of the
Parties. Nothing in this Agreement, express or implied, is intended to confer
upon any party other than the Parties hereto or their respective successors and
assigns any rights, remedies, obligations, or liabilities under or by reason of
this Agreement, except as expressly provided in this Agreement.

                  (b) Each transferee or assignee of the Shares subject to this
Agreement shall continue to be subject to the terms hereof, and, as a condition
to the Company's recognizing the transfer, each transferee or assignee shall
agree in writing to be subject to the terms of this Agreement by executing and
delivering an Adoption Agreement substantially in the form attached hereto as
Exhibit 1. Upon the execution and delivery of an Adoption Agreement by a
transferee, the transferee shall be deemed to be a Party hereto as if the
transferee's signature appeared on the signature pages of this Agreement. By
execution of this Agreement or of any Adoption Agreement, each of the Parties
appoints the Company as its attorney in fact for the purpose of executing an
Adoption Agreement that is required to be delivered under the terms of this
Agreement. The Company shall not permit the transfer of the Shares subject to
this Agreement on its books or issue a new certificate representing the Shares

                                       2
<PAGE>

unless and until the transferee has complied with the terms of this Section 4.1.
Each certificate representing the Shares subject to this Agreement if issued on
or after the date of this Agreement shall be endorsed by the Company with the
legend set forth in Section 4.10. Nothing in this Agreement, express or implied,
is intended to confer upon any party other than the Parties or their respective
executors, administrators, heirs, successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.

            4.2 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the General Corporation Law of the State of Utah as to
matters within the scope thereof, and as to all other matters shall be governed
by and construed in accordance with the internal laws of the State of Michigan,
without regard to its principles of conflicts of laws.

            4.3 COUNTERPARTS; SIGNATURES. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. This Agreement may
also be executed and delivered by facsimile signature which shall be legally
binding as if it were an original.

            4.4 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

            4.5 NOTICES. All notices and other communications given or made
pursuant to this Agreement shall be in writing and shall be deemed effectively
given: (a) upon personal delivery to the Party to be notified, (b) when sent by
confirmed electronic mail or facsimile if sent during normal business hours of
the recipient, and if not so confirmed, then on the next business day, (c) five
days after having been sent by registered or certified mail, return receipt
requested, postage prepaid, or (d) one day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with written
verification of receipt. All communications shall be sent to the Parties at
their addresses as set forth on the signature page, or to the email address,
facsimile number or address as subsequently modified by written notice given in
accordance with this Section 4.5.

            4.6 AMENDMENT.

                  (a) This Agreement may be amended or modified and the
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively) only by a written
instrument executed by the Company, Deneau and Investor. Any amendment or waiver
so effected shall be binding upon the Company, the Stockholders and the
Investor, and all of their respective successors and permitted assigns whether
or not the Party, assignee or other shareholder entered into or approved the
amendment or waiver.

                  (b) The Company shall give prompt written notice of any
amendment or termination of this Agreement or waiver hereunder to any Party that
did not consent in writing to the amendment, termination or waiver. Any
amendment, termination or waiver effected in accordance with this Section 4.6
shall be binding on all Parties, even if they do not execute the consent.

            4.7 SEVERABILITY. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.

                                       3
<PAGE>

            4.8 DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power or remedy accruing to any Party under this Agreement, upon any breach or
default of any other party under this Agreement, shall impair any right, power
or remedy of the non-breaching or non-defaulting Party, nor shall it be
construed to be a waiver of any breach or default, or an acquiescence therein.
Nor shall any waiver of any single breach or default be deemed a waiver of any
other breach or default. Any waiver, permit, consent or approval of any kind or
character on the part of any Party of any breach or default under this
Agreement, or any waiver on the part of any Party of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to
the extent specifically set forth in the writing. All remedies, either under
this Agreement or by law or otherwise afforded to any Party, shall be cumulative
and not alternative.

            4.9 ENTIRE AGREEMENT. This Agreement constitutes the full and entire
understanding and agreement between the Parties with respect to the subject
matter of this Agreement, and any other written or oral agreement relating to
the subject matter of this Agreement existing between the Parties is expressly
canceled.

            4.10 LEGEND ON SHARE CERTIFICATES. Each certificate representing any
Shares shall be endorsed by the Company with a legend reading substantially as
follows:

            THE SHARES EVIDENCED HEREBY ARE SUBJECT TO A VOTING AGREEMENT (A
            COPY OF WHICH MAY BE OBTAINED UPON WRITTEN REQUEST FROM THE
            COMPANY), AND BY ACCEPTING ANY INTEREST IN THE SHARES THE PERSON
            ACCEPTING THE INTEREST SHALL BE DEEMED TO AGREE TO AND SHALL BECOME
            BOUND BY ALL THE PROVISIONS OF THAT VOTING AGREEMENT, INCLUDING
            CERTAIN RESTRICTIONS ON TRANSFER AND OWNERSHIP SET FORTH THEREIN.

            4.11 EXECUTION BY THE COMPANY. The Company, by its execution in the
space provided below, agrees that it will cause the certificates evidencing the
Shares to bear the legend required by Section 4.10, and it shall supply, free of
charge, a copy of this Agreement to any holder of a certificate evidencing the
Shares upon written request from the holder to the Company at its principal
office. The Parties to this Agreement agree that the failure to cause the
certificates evidencing the Shares to bear the legend required by Section 4.10
and the failure of the Company to supply, free of charge, a copy of this
Agreement as provided under this Section 4.11 shall not affect the validity or
enforcement of this Agreement.

            4.12 STOCK SPLITS, STOCK DIVIDENDS, ETC. If the Company issues
additional Shares to any of the Stockholders (including, without limitation, in
connection with any stock split, stock dividend, recapitalization,
reorganization, or the like), the additional Shares shall become subject to this
Agreement and shall be endorsed with the legend set forth in Section 4.10.

            4.13 COVENANTS OF THE COMPANY. The Company agrees to use its best
efforts to ensure that the rights granted under this Agreement are effective and
that the Parties enjoy the benefits of this Agreement. This includes, without
limitation, the use of the Company's best efforts to cause the nomination and
election of the directors as provided above. The Company will not, by any
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be performed by the Company under this Agreement, but will at all
times in good faith assist in the carrying out of all of the provisions of this

                                       4
<PAGE>

Agreement and in the taking of all actions that are necessary, appropriate or
reasonably requested by a Stockholder or Investor in order to protect the rights
of the Stockholders and Investor against impairment.

            4.14 MANNER OF VOTING; GRANT OF PROXY. The voting of Shares pursuant
to this Agreement may be effected in person, by proxy, by written consent or in
any other manner permitted by applicable law. Each Party hereby grants to the
Secretary of the Company, in the event that the Party fails to vote the Party's
Shares as required by this Agreement, a proxy coupled with an interest in all
Shares, whether held by an Investor or a Stockholder, beneficially owned by the
Party, which proxy is irrevocable until this Agreement terminates pursuant to
its terms or this Section 4.14 is amended in accordance with Section 4.6 to
remove the grant of proxy.

            4.15 COSTS OF ENFORCEMENT. If any Party to this Agreement seeks to
enforce its rights under this Agreement by legal proceedings, the non-prevailing
Party shall pay all costs and expenses incurred by the prevailing Party,
including, without limitation, all reasonable attorneys' fees.

            4.16 ADDITIONAL INVESTORS. Notwithstanding anything to the contrary
contained in this Agreement, if the Company issues additional shares of the
Company's common stock after the date of this Agreement, the purchaser may
become a Party to this Agreement by executing and delivering an additional
counterpart signature page to this Agreement and thereafter shall be deemed a
Stockholder under this Agreement.

            4.17 SPOUSAL CONSENT. If a Stockholder who resides in Arizona,
California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin,
or the Commonwealth of Puerto Rico (a "COMMUNITY PROPERTY STATE STOCKHOLDER") is
married on the date of this Agreement, such Community Property State
Stockholder's spouse shall execute and deliver to the Company a consent of
spouse in the form of Exhibit 2 ("CONSENT OF SPOUSE"), effective on the date of
this Agreement. The Consent of Spouse shall not be deemed to confer or convey to
the spouse any rights in the Community Property State Stockholder's shares of
capital stock that do not otherwise exist by operation of law or the agreement
of the parties. If a Community Property State Stockholder marries or remarries
subsequent to the date of this Agreement, such Community Property State
Stockholder shall, within 30 days after the marriage, obtain his/her new
spouse's acknowledgement of and consent to the existence and binding effect of
all restrictions contained in this Agreement by causing the new spouse to
execute and deliver a Consent of Spouse acknowledging the restrictions and
obligations contained in this Agreement and agreeing and consenting to them.

                                       5
<PAGE>

      IN WITNESS OF THIS VOTING AGREEMENT, the Parties have signed below.

                             CADENCE RESOURCES CORPORATION

                             By:
                                -----------------------------------------------

                             Name:
                                  ---------------------------------------------

                             Title:
                                   --------------------------------------------

                             Address:
                                     ------------------------------------------

                             Fax No.
                                     ------------------------------------------

                             E-mail:
                                     ------------------------------------------

                             Date:
                                  ---------------------------------------------

                                       6
<PAGE>

                           COUNTERPART SIGNATURE PAGE

                          CADENCE RESOURCES CORPORATION

                                VOTING AGREEMENT

                          DATED: ________________, 2005

                                    STOCKHOLDER:

                                    By:
                                       ----------------------------------------

                                    Name:
                                         --------------------------------------

                                    Title:
                                          -------------------------------------

                                    Address:
                                            -----------------------------------

                                            -----------------------------------
                                    Fax No.
                                            -----------------------------------

                                    E-mail:
                                           ------------------------------------

                                    Date:
                                         --------------------------------------

<PAGE>

                                   SCHEDULE A

                                   STOCKHOLDER

<TABLE>
<CAPTION>
                                                                  Number of Shares Entitled to Vote by Direct
                                                                Ownership, Beneficial Ownership, and Irrevocable
                               Name                                                      Proxy
----------------------------------------------------------------------------------------------------------------
<S>                                                            <C>
Howard Crosby

Crosby Enterprises, Inc.

Dotson Exploration Company

John Ryan

Nancy Martin Ryan

Nancy Martin Ryan as custodian for Karen Ryan

Nancy Martin Ryan as custodian for Patrick Ryan

J.P. Ryan Company, Inc.

Andover Capital Corporation

Nathan A. Low Roth IRA

Nathan A. Low

Nathan A. Low Family Trust

Shares owned by Nathan A. Low's wife for the benefit of
their minor children

Thomas Kaplan

Electrum Resources, LLC

Electrum Capital, LLC

CGT Management, Ltd.

William W. Deneau

Patricia A. Deneau Trust

Denthorn Trust

John V. Miller
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
                                                                  Number of Shares Entitled to Vote by Direct
                                                                Ownership, Beneficial Ownership, and Irrevocable
                               Name                                                      Proxy
----------------------------------------------------------------------------------------------------------------
<S>                                                             <C>
John V. & Michelle R. Miller TTEE, Miller Family Living
Trust DTD 6/25/97

Miller Resources, Inc.

Thomas W. Tucker

Sandra L. Tucker Trust

Thomas W. Tucker Trust

Robin C. Dubuc

Robin C. Dubuc Living Trust, DTD 1/21/87

Gary J. Myles

Earl V. Young
</TABLE>

<PAGE>

                                    EXHIBIT 1

                               ADOPTION AGREEMENT

      THIS ADOPTION AGREEMENT ("ADOPTION AGREEMENT") is executed by the
undersigned (the "TRANSFEREE") pursuant to the terms of that certain Voting
Agreement dated as of _____________, 2005 (the "AGREEMENT") by and among the
Company and certain of its Stockholders. Capitalized terms used but not defined
in this Adoption Agreement shall have the respective meanings ascribed to them
in the Agreement. By the execution of this Adoption Agreement, the Transferee
agrees as follows:

      1.1 ACKNOWLEDGEMENT. Transferee acknowledges that Transferee is acquiring
certain shares of the capital stock of the Company (the "SHARES"), subject to
the terms and conditions of the Agreement and that if Transferee does not
execute this Adoption Agreement, the Shares will not be transferred to
Transferee.

      1.2 AGREEMENT. Transferee (i) agrees that the Shares acquired by
Transferee shall be bound by and subject to the terms of the Agreement, and (ii)
hereby adopts the Agreement with the same force and effect as if Transferee were
originally a Party thereto.

      1.3 NOTICE. Any notice required or permitted by the Agreement shall be
given to Transferee at the address listed beside Transferee's signature below.

      EXECUTED AND DATED this ______ day of _______________, 200__.

                                        TRANSFEREE

                                        By:
                                             ----------------------------------

                                        Name:
                                             ----------------------------------

                                        Title:
                                              ---------------------------------

                                        Address:
                                                -------------------------------

                                        Fax:
                                            -----------------------------------

                                        E-mail:
                                               --------------------------------

Accepted and Agreed:

CADENCE RESOURCES CORPORATION,
Individually and as Attorney-in-Fact for the
Stockholders and Investor

By:
     -------------------------------------------------------------------

Title:
        ----------------------------------------------------------------

<PAGE>

                                    EXHIBIT 2

                                CONSENT OF SPOUSE

      I, ____________________, spouse of ______________, acknowledge that I have
read the Voting Agreement, dated as of _____________, 2005, to which this
Consent is attached as Exhibit 2 (the "AGREEMENT"), and that I know the contents
of the Agreement. I am aware that the Agreement contains provisions regarding
the voting and transfer of shares of capital stock of the Company which my
spouse may own, including any interest I might have therein.

      I hereby agree that my interest, if any, in any shares of capital stock of
the Company subject to the Agreement shall be irrevocably bound by the Agreement
and further understand and agree that any community property interest I may have
in the shares of capital stock of the Company shall be similarly bound by the
Agreement.

      I am aware that the legal, financial and related matters contained in the
Agreement are complex and that I am free to seek independent professional
guidance or counsel with respect to this Consent. I have either sought such
guidance or counsel or determined after reviewing the Agreement carefully that I
will waive such right.

Dated:
      ---------------------           ----------------------------------------
                                      Signature

                                      Print Name of Stockholder's Spouse

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