Document:

Unassociated Document

    
       
ARGENT
      SECURITIES INC.

     

    $1,391,343,000
      (Approximate)

    Asset-Backed
      Pass-Through Certificates

    Argent
      Securities Inc.

    Series
      2006-W4

    

     

    April
      19,
      2006

     

    UNDERWRITING
      AGREEMENT

     

    

    
      	
              J.P.
                Morgan Securities Inc.

              as
                Representative of the several Underwriters

              270
                Park Avenue 

              New
                York, NY 10017

            	 

    

    

    Ladies
      and Gentlemen:

     

    Argent
      Securities Inc. (the “Depositor”), a Delaware corporation, has authorized the
      issuance and sale of Argent Securities Inc., Asset-Backed Pass-Through
      Certificates, Series 2006-W4 (the “Certificates”). The Certificates are
      designated as (i) the Class A-1 Certificates, the Class A-2A Certificates,
      the
      Class A-2B Certificates, the Class A-2C Certificates and the Class A-2D
      Certificates (collectively, the “Class A Certificates”) and (ii) the Class M-1
      Certificates, the Class M-2 Certificates, the Class M-3 Certificates, the Class
      M-4 Certificates, the Class M-5 Certificates, the Class M-6 Certificates, the
      Class M-7 Certificates, the Class M-8 Certificates, the Class M-9 Certificates
      and the Class M-10 Certificates (collectively, the “Mezzanine Certificates”;
      together with the Class A Certificates, the “Underwritten Certificates”). Also
      to be issued are the Class CE Certificates, the Class P Certificates, the Class
      R Certificates and the Class R-X Certificates (collectively, the “Non-Offered
      Certificates”). The Underwritten Certificates and the Non-Offered Certificates
      are referred to together as the “Certificates.”

     

    Only
      the
      Underwritten Certificates are being purchased by the underwriters named in
      Schedule A hereto (the “Underwriters”), and the Underwriters severally are
      purchasing only the Underwritten Certificates set forth opposite their names
      in
      Schedule A, except that the amounts purchased by the Underwriters may change
      in
      accordance with Section 10 of this Agreement. J.P. Morgan Securities Inc. is
      acting as representative of the several Underwriters and, in such capacity,
      is
      hereinafter referred to as the “Representative.” If only one underwriter is
      named in Schedule A, the terms “Underwriter,” “Underwriters” and
“Representative” shall refer to that named underwriter.

     

    The
      Certificates will be issued under a Pooling and Servicing Agreement, dated
      as of
      April 1, 2006 (the “Pooling and Servicing Agreement”), among the Depositor as
      depositor, Ameriquest Mortgage Company as master servicer (in such capacity,
      the
“Master Servicer”) and Deutsche Bank National Trust Company as trustee (in such
      capacity, the “Trustee”). Capitalized but undefined terms shall have the
      meanings set forth in the Pooling and Servicing Agreement.

     

    The
      Certificates will evidence fractional undivided interests in the Trust (the
      “Trust”) formed pursuant to the Pooling and Servicing Agreement. The assets of
      the Trust will include, among other things, a segregated pool (the “Mortgage
      Pool”) of certain adjustable-rate and fixed-rate, conventional, one- to
      four-family residential mortgage loans (collectively, the “Mortgage Loans”), the
      Master Servicer Prepayment Charge Payment Amounts, the Net WAC Rate Carryover
      Reserve Account and the Swap Account (including any payments made under the
      Swap
      Administration Agreement deposited in the Trust) and such amounts as may be
      held
      by the Trustee in any other accounts held by the Trustee for the Trust. A form
      of the Pooling and Servicing Agreement has been filed as an exhibit to the
      Registration Statement.

     

    The
      Underwritten Certificates are more fully described in a Registration Statement
      which the Depositor has furnished to the Underwriters.

     

    Pursuant
      to the Mortgage Loan Purchase Agreement, dated the date of this Agreement (the
      “Mortgage Loan Purchase Agreement”), between Ameriquest Mortgage Company (in
      such capacity, the “Seller”) and the Depositor, the Seller will sell to the
      Depositor all of its right, title and interest in and to the Mortgage Loans,
      including the scheduled principal balances of the Mortgage Loans as of the
      Cut-off Date and interest due after the Cut-off Date. Pursuant to the Pooling
      and Servicing Agreement, the Depositor will sell to the Trust all of its right,
      title and interest in and to the Mortgage Loans, including the scheduled
      principal balances of the Mortgage Loans as of the Cut-off Date and interest
      due
      after the Cut-off Date.

     

     

    SECTION
      1.  Representations
      and Warranties of the Depositor.
      The
      Depositor represents and warrants to, and agrees with the Underwriters that
      as
      of the date of the Preliminary Prospectus, as of the date of the Prospectus,
      and
      as of the Closing Date:

     

    (a)  A
      Registration Statement on Form S-3 (No. 333-131895) relating to the Underwritten
      Certificates has (i) been prepared by the Depositor in conformity with the
      requirements of the Securities Act of 1933, as amended (the “Securities Act”),
      and the rules and regulations (the “Rules and Regulations”) of the United States
      Securities and Exchange Commission (the “Commission”) thereunder, (ii) been
      filed with the Commission under the Securities Act and (iii) become effective
      and is still effective as of the date hereof under the Securities Act. Copies
      of
      such Registration Statement have been delivered by the Depositor to the
      Underwriters. As used in this Agreement, “Effective Time” means the date and the
      time as of which such Registration Statement, or the most recent post-effective
      amendment thereto, if any, was declared effective by the Commission; “Effective
      Date” means the date of the Effective Time; “Registration Statement” means such
      registration statement, at the Effective Time, including any documents
      incorporated by reference therein at such time; “Base Prospectus” means such
      final prospectus dated March 31, 2006 and “Prospectus Supplement” means the
      final prospectus supplement relating to the Underwritten Certificates, to be
      filed with the Commission pursuant to paragraph (2), (3) or (5) of Rule 424(b)
      of the Rules and Regulations. “Prospectus” means the Base Prospectus together
      with the Prospectus Supplement. The Depositor has prepared a Free Writing
      Prospectus, dated April 18, 2006, that contains substantially all information
      that will appear in the Prospectus Supplement and including the Static Pool
      Information referred to in the Free Writing Prospectus, to the extent that
      such
      information is known at that time (such Free Writing Prospectus together with
      the Base Prospectus, the “Preliminary Prospectus”). Reference made herein to the
      Preliminary Prospectus or the Prospectus shall be deemed to refer to and include
      any documents incorporated by reference therein pursuant to Item 12 of Form
      S-3
      under the Securities Act, as of the date of the Prospectus and any reference
      to
      any amendment or supplement to the Preliminary Prospectus or the Prospectus
      shall be deemed to refer to and include any document filed under the Securities
      Exchange Act of 1934, as amended (the “Exchange Act”), after the date of the
      Preliminary Prospectus or the Prospectus, as applicable, and incorporated by
      reference in the Preliminary Prospectus or the Prospectus, as applicable, and
      any reference to any amendment to the Registration Statement shall be deemed
      to
      include any report of the Depositor filed with the Commission pursuant to
      Section 13(a) or 15(d) of the Exchange Act after the Effective Time that is
      incorporated by reference in the Registration Statement. The Commission has
      not
      issued any order preventing or suspending the use of the Prospectus or the
      Preliminary Prospectus or the effectiveness of the Registration Statement and
      no
      proceedings for such purpose are pending or, to the Depositor’s knowledge,
      threatened by the Commission. There are no contracts or documents of the
      Depositor which are required to be filed as exhibits to the Registration
      Statement pursuant to the Securities Act or the Rules and Regulations which
      have
      not been so filed or incorporated by reference therein on or prior to the
      Effective Date of the Registration Statement other than such documents or
      materials, if any, as any Underwriter delivers to the Depositor pursuant to
      Section 5 hereof for filing on Form 8-K. The conditions for use of Form S-3,
      as
      set forth in the General Instructions thereto, have been satisfied.

     

    (b)  The
      Registration Statement, the Preliminary Prospectus, the Prospectus and the
      Static Pool Information conform, and any further amendments or supplements
      to
      the Registration Statement, the Preliminary Prospectus and the Prospectus will
      conform, when they become effective, are filed with the Commission or as of
      the
      date of the Contract of Sale, as the case may be, in all respects to the
      requirements of the Securities Act and the Rules and Regulations. The
      Registration Statement, as of the Effective Date thereof, and any amendment
      thereto, did not contain an untrue statement of a material fact or omit to
      state
      a material fact required to be stated therein or necessary to make the
      statements therein not misleading. The Preliminary Prospectus, as amended or
      supplemented, as of its date and as of the date of the Contract of Sale, and
      the
      Prospectus, as amended or supplemented, as of its date and as of the Closing
      Date, and the Static Pool Information, as of the date of the Contract of Sale
      and as of the Closing Date, do not and will not contain any untrue statement
      of
      a material fact or omit to state a material fact necessary in order to make
      the
      statements therein, in light of the circumstances under which they were made,
      not misleading; provided that no representation or warranty is made as to (i)
      information contained in or omitted from the Registration Statement, the
      Preliminary Prospectus or the Prospectus in reliance upon and in conformity
      with
      written information furnished to the Depositor in writing by any Underwriter
      through the Representative expressly for use therein as set forth in Exhibit
      A
      hereto (the “Underwriters’ Information”), and (ii) any Excluded Information (as
      defined in Section 8(a)(i) below).

     

    (c)  The
      documents incorporated by reference in the Preliminary Prospectus or the
      Prospectus, as applicable, when they became effective, were filed with the
      Commission or as of the date of the Contract of Sale, as the case may be,
      conformed in all material respects to the requirements of the Securities Act
      or
      the Exchange Act, as applicable, and the rules and regulations of the Commission
      thereunder; and any further documents so filed and incorporated by reference
      in
      the Prospectus, when such documents become effective, are filed with the
      Commission or as of the date of the Contract of Sale, as the case may be, will
      conform in all material respects to the requirements of the Securities Act
      or
      the Exchange Act, as applicable, and the rules and regulations of the Commission
      thereunder.

     

    (d)  The
      Depositor has been duly incorporated and is validly existing as a corporation
      in
      good standing under the laws of its jurisdiction of incorporation and is in
      good
      standing as a foreign corporation in each jurisdiction in which its ownership
      or
      lease of property or the conduct of its business so requires such standing.
      The
      Depositor has all power and authority necessary to own or hold its properties,
      to conduct the business in which it is engaged and to enter into and perform
      its
      obligations under this Agreement, the Mortgage Loan Purchase Agreement and
      the
      Pooling and Servicing Agreement (collectively, the “Agreements”) and to cause
      the Certificates to be issued.

     

    (e)  Except
      as
      disclosed in the Preliminary Prospectus and the Prospectus, there are no
      actions, proceedings or investigations pending with respect to which the
      Depositor has received service of process before, or, to the best of the
      Depositor’s knowledge, threatened, by any court, administrative agency or other
      tribunal to which the Depositor is a party or of which any of its properties
      is
      the subject (a) which if determined adversely to the Depositor would have a
      material adverse effect on the business or financial condition of the Depositor,
      (b) asserting the invalidity of any of the Agreements or the Certificates,
      (c)
      seeking to prevent the issuance of the Certificates or the consummation by
      the
      Depositor of any of the transactions contemplated by any of the Agreements
      or
      (d) which might materially and adversely affect the performance by the Depositor
      of its obligations under, or the validity or enforceability of any of the
      Agreements or the Certificates.

     

    (f)  This
      Agreement has been, and the other Agreements when executed and delivered as
      contemplated hereby and thereby will have been, duly authorized, executed and
      delivered by the Depositor, and this Agreement constitutes, and the other
      Agreements when executed and delivered as contemplated herein will constitute,
      legal, valid and binding instruments enforceable against the Depositor in
      accordance with their respective terms, subject as to enforceability to (x)
      applicable bankruptcy, reorganization, insolvency, moratorium or other similar
      laws affecting creditors’ rights generally, (y) general principles of equity
      (regardless of whether enforcement is sought in a proceeding in equity or at
      law), and (z) with respect to rights of indemnity under any of the Agreements,
      limitations of public policy under applicable securities laws.

     

    (g)  The
      execution, delivery and performance of the Agreements by the Depositor and
      the
      consummation of the transactions contemplated hereby and thereby, and the
      issuance and delivery of the Certificates do not and will not conflict with
      or
      result in a breach or violation of any of the terms or provisions of, or
      constitute a default under, any indenture, mortgage, deed of trust, loan
      agreement or other agreement or instrument to which the Depositor is a party,
      by
      which the Depositor is bound or to which any of the properties or assets of
      the
      Depositor or any of its subsidiaries is subject, which breach or violation
      would
      have a material adverse effect on the business, operations or financial
      condition of the Depositor or its ability to perform its obligations under
      any
      of the Agreements, nor will such actions result in any violation of the
      provisions of the articles of incorporation or by-laws of the Depositor or
      any
      statute or any order, rule or regulation of any court or governmental agency
      or
      body having jurisdiction over the Depositor or any of its properties or assets,
      which breach or violation would have a material adverse effect on the business,
      operations or financial condition of the Depositor or its ability to perform
      its
      obligations under any of the Agreements.

     

    (h)  The
      direction by the Depositor to the Trustee to execute, authenticate, issue and
      deliver the Certificates has been duly authorized by the Depositor, and,
      assuming the Trustee has been duly authorized to undertake such actions, when
      executed, authenticated, issued and delivered by the Trustee, in accordance
      with
      the Pooling and Servicing Agreement, the Certificates will be validly issued
      and
      outstanding and the holders of the Certificates will be entitled to the rights
      and benefits of the Certificates as provided by the Pooling and Servicing
      Agreement.

     

    (i)  No
      consent, approval, authorization, order, registration or qualification of or
      with any court or governmental agency or body of the United States is required
      for the issuance of the Certificates and the sale of the Underwritten
      Certificates to the Underwriters, or the consummation by the Depositor of the
      other transactions contemplated by the Agreements except such consents,
      approvals, authorizations, registrations or qualifications as may be required
      under state securities or Blue Sky laws in connection with the purchase and
      distribution of the Underwritten Certificates by the Underwriters or as have
      been obtained.

     

    (j)  At
      the
      time of the execution and delivery of the Pooling and Servicing Agreement,
      the
      Depositor will: (i) have equitable title to the Mortgage Loans conveyed by
      the
      Seller, free and clear of any lien, mortgage, pledge, charge, encumbrance,
      adverse claim or other security interest (collectively, “Liens”); (ii) not have
      assigned to any person (other than the Trustee) any of its right, title or
      interest in the Mortgage Loans and (iii) have the power and authority to sell
      the Mortgage Loans to the Trustee and to sell the Underwritten Certificates
      to
      the Underwriters. Upon execution and delivery of the Pooling and Servicing
      Agreement by the Trustee, the Trustee will have acquired beneficial ownership
      of
      all of the Depositor’s right, title and interest in and to the Mortgage Loans.
      Upon delivery to the Underwriters of the Underwritten Certificates, the
      Underwriters will have good title to the Underwritten Certificates free of
      any
      Liens.

     

    (k)  As
      of the
      Cut-off Date, each of the Mortgage Loans will meet the eligibility criteria
      described in the Preliminary Prospectus and the Prospectus and will conform
      to
      the descriptions thereof contained in the Preliminary Prospectus and the
      Prospectus.

     

    (l)  Neither
      the Depositor nor the Trust is an “investment company” within the meaning of
      such term under the Investment Company Act of 1940, as amended (the “1940 Act”)
      and the rules and regulations of the Commission thereunder.

     

    (m)  At
      the
      Closing Date, the Underwritten Certificates and the Pooling and Servicing
      Agreement will conform in all material respects to the descriptions thereof
      contained in the Preliminary Prospectus and the Prospectus.

     

    (n)  Any
      taxes, fees and other governmental charges in connection with the execution,
      delivery and issuance of the Agreements and the Certificates have been paid
      or
      will be paid at or prior to the Closing Date.

     

    (o)  Since
      the
      respective dates as of which information is given in the Preliminary Prospectus
      and the Prospectus, there has not been any material adverse change in the
      general affairs, management, financial condition, or results of operations
      of
      the Depositor or Seller, otherwise than as set forth or contemplated in the
      Prospectus as supplemented or amended as of the Closing Date.

     

    (p)  As
      of the
      Effective Date and as of the date of the Contract of Sale, the Depositor is
      not
      and will not be as of the Closing Date an “ineligible issuer” as defined in Rule
      405 under the Securities Act.

     

    (q)  Any
      certificate signed by an officer of the Depositor and delivered to the
      Underwriters or counsel for the Underwriters in connection with an offering
      of
      the Underwritten Certificates shall be deemed, and shall state that it is,
      a
      representation and warranty as to the matters covered thereby to each person
      to
      whom the representations and warranties in this Section 1 are made.

     

    (r)  As
      of the
      date of the Contract of Sale, each Issuer Free Writing Prospectus and the
      Preliminary Prospectus, considered together, did not include any untrue
      statement of a material fact or omission of any material fact necessary in
      order
      to make the statements therein, in the light of the circumstances under which
      they were made, not misleading.

     

    SECTION
      2.  Purchase
      and Sale.
      The
      several commitments of the Underwriters to purchase the Underwritten
      Certificates pursuant to this Agreement shall be deemed to have been made on
      the
      basis of the representations and warranties herein contained and shall be
      subject to the terms and conditions herein set forth. The Depositor agrees
      to
      instruct the Trustee to issue the Certificates and agrees to sell to each
      Underwriter, and each Underwriter agrees (except as provided in Section 10
      hereof) severally and not jointly to purchase from the Depositor, the aggregate
      principal amounts or percentage interests of the Underwritten Certificates
      of
      each Class, as set forth opposite such Underwriter’s name on Schedule A, at the
      purchase price or prices set forth on Schedule A.

     

    SECTION
      3.  Delivery
      and Payment.
      Delivery of and payment for the Underwritten Certificates shall be made at
      the
      offices of Thacher Proffitt & Wood LLP, Two World Financial Center, 29th
      Floor, New York, New York 10281, or at such other place as shall be agreed
      upon
      by the Underwriters and the Depositor at 10:00 A.M. New York City time on April
      25, 2006, or at such other time or date as shall be agreed upon in writing
      by
      the Underwriters and the Depositor (such date being referred to as the “Closing
      Date”). Payment shall be made to the Depositor by wire transfer of same day
      funds payable to the account of the Depositor. Delivery of the Underwritten
      Certificates shall be made to the several Underwriters against payment of the
      purchase price thereof. The Underwritten Certificates so delivered will be
      initially represented by one or more certificates registered in the name of
      Cede
& Co., the nominee of The Depository Trust Company (“DTC”). The interests of
      the beneficial owners of the Underwritten Certificates will be represented
      by
      book entries on the records of DTC and participating members thereof. Definitive
      Underwritten Certificates will be available only under the limited circumstances
      specified in the Pooling and Servicing Agreement.

     

    SECTION
      4.  Offering
      by the Underwriters.
      It is
      understood that, subject to the terms and conditions hereof, the several
      Underwriters propose to offer the Underwritten Certificates for sale to the
      public as set forth in the Prospectus.

     

    SECTION
      5.  Agreements.

     

    (a)   The
      Depositor agrees as follows:

     

     

    
      	 	(i)	
              To
                prepare the Preliminary Prospectus and the Prospectus in a form approved
                by the Underwriters; to file such Preliminary Prospectus pursuant
                to Rule
                433(d) under the Securities Act not later than the same day on which
                the
                Preliminary Prospectus was made available to the Underwriters; to
                file
                such Prospectus pursuant to Rule 424(b) under the Securities Act
                not later
                than the second Business Day following the day on which the Prospectus
                was
                made available to the Underwriters; to make no further amendment
                or
                supplement to the Registration Statement or to the Prospectus prior
                to the
                Closing Date except as permitted herein; to advise the Underwriters,
                promptly after it receives notice thereof, of the time when any amendment
                to the Registration Statement has been filed or becomes effective
                prior to
                the termination of the offering of the Underwritten Certificates
                or any
                supplement to the Prospectus or any amended Prospectus has been filed
                and
                to furnish the Underwriters or their counsel with copies thereof
                without
                charge; to file promptly all reports and any definitive proxy or
                information statements required to be filed by the Depositor with
                the
                Commission pursuant to Section 13(a), 13(c), 14 or l5(d) of the Exchange
                Act subsequent to the date of the Prospectus and, for so long as
                the
                delivery of a prospectus is required in connection with the offering
                or
                sale of the Underwritten Certificates; to promptly advise the Underwriters
                of its receipt of notice of the issuance by the Commission of any
                stop
                order or the institution of or, to the knowledge of the Depositor,
                the
                threatening of any proceeding for such purpose, or of: (i) any order
                preventing or suspending the use of the Preliminary Prospectus or
                the
                Prospectus; (ii) the suspension of the qualification of the Underwritten
                Certificates for offering or sale in any jurisdiction; (iii) the
                initiation of or threat of any proceeding for any such purpose or
                (iv) any
                request by the Commission for the amending or supplementing of the
                Registration Statement, the Preliminary Prospectus or the Prospectus
                or
                for additional information. In the event of the issuance of any stop
                order
                or of any order preventing or suspending the use of the Preliminary
                Prospectus or the Prospectus or suspending any such qualification,
                the
                Depositor promptly shall use its best efforts to obtain the withdrawal
                of
                such order by the Commission.

            
	 	 	 
	 	(ii)	
              To
                furnish promptly to the Underwriters and to counsel for the Underwriters
                a
                signed copy of the Registration Statement as originally filed with
                the
                Commission, and of each amendment thereto filed with the Commission,
                including all consents and exhibits filed therewith.

            
	 	 	 
	 	(iii)	
              To
                deliver promptly to the Underwriters without charge such number of
                the
                following documents as the Underwriters shall reasonably request:
                (i)
                conformed copies of the Registration Statement as originally filed
                with
                the Commission and each amendment thereto (in each case including
                exhibits); (ii) the Preliminary Prospectus, the Prospectus and any
                amended
                or supplemented Preliminary Prospectus or Prospectus and (iii) any
                document incorporated by reference in the Preliminary Prospectus
                or the
                Prospectus (including exhibits thereto). If the delivery of a prospectus
                is required at any time prior to the expiration of nine months after
                the
                Closing Date in connection with the offering or sale of the Underwritten
                Certificates, and if at such time any events shall have occurred
                as a
                result of which the Prospectus as then amended or supplemented would
                include any untrue statement of a material fact or omit to state
                any
                material fact necessary in order to make the statements therein,
                in light
                of the circumstances under which they were made when such Prospectus
                is
                delivered, not misleading, or, if for any other reason it shall be
                necessary during such same period to amend or supplement the Prospectus
                or
                to file under the Exchange Act any document incorporated by reference
                in
                the Prospectus in order to comply with the Securities Act or the
                Exchange
                Act, the Depositor shall notify the Underwriters and, upon any
                Underwriter’s request, shall file such document and prepare and furnish
                without charge to the Underwriters and to any dealer in securities
                as many
                copies as the Underwriters may from time to time reasonably request
                of an
                amended Prospectus or a supplement to the Prospectus which corrects
                such
                statement or omission or effects such compliance, and in case the
                Underwriters are required to deliver a Prospectus in connection with
                sales
                of any of the Underwritten Certificates at any time nine months or
                more
                after the Effective Time, upon the request of the Underwriters but
                at
                their expense, the Depositor shall prepare and deliver to the Underwriters
                as many copies as the Underwriters may reasonably request of an amended
                or
                supplemented Prospectus complying with Section 10(a)(3) of the Securities
                Act.

            
	 	 	 
	 	(iv)	
              To
                file promptly with the Commission any amendment to the Registration
                Statement, the Preliminary Prospectus or the Prospectus or any supplement
                to the Prospectus that may, in the judgment of the Depositor or the
                Underwriters, be required by the Securities Act or requested by the
                Commission. Neither the Underwriters’ consent to nor their distribution of
                any amendment or supplement shall constitute a waiver of any of the
                conditions set forth in Section 6.

            
	 	 	 
	 	(v)	
              To
                furnish the Underwriters and counsel for the Underwriters, prior
                to filing
                with the Commission, and to obtain the consent of the Underwriters
                for the
                filing of the following documents relating to the Underwritten
                Certificates: (i) any Post-Effective Amendment to the Registration
                Statement or supplement to the Prospectus, or document incorporated
                by
                reference in the Prospectus or (ii) the Preliminary Prospectus and
                the
                Prospectus pursuant to the Rules and Regulations.

            
	 	 	 
	 	(vi)	
              To
                use commercially reasonable efforts, in cooperation with the Underwriters,
                to qualify the Underwritten Certificates for offering and sale under
                the
                applicable securities laws of such states and other jurisdictions
                of the
                United States or elsewhere as the Underwriters may reasonably designate,
                and maintain or cause to be maintained such qualifications in effect
                for
                as long as may be required for the distribution of the Underwritten
                Certificates. The Depositor will file or cause the filing of such
                statements and reports as may be required by the laws of each jurisdiction
                in which the Underwritten Certificates have been so qualified; provided,
                however, that the Depositor shall not be required to qualify to do
                business in any jurisdiction where it is not now so qualified or
                to take
                any action which would subject it to general or unlimited service
                of
                process in any jurisdiction where it is now so subject.

            
	 	 	 
	 	(vii)	
              So
                long as the Underwritten Certificates shall be outstanding, the Depositor
                shall cause the Trustee, pursuant to the Pooling and Servicing Agreement,
                to deliver to the Underwriters as soon as such statements are furnished
                to
                the Trustee: (i) the annual assessment of compliance delivered to
                the
                Trustee pursuant to Section 3.20 of the Pooling and Servicing Agreement;
                (ii) the annual attestation of a firm of registered public accountants
                furnished to the Trustee pursuant to Section 3.20 of the Pooling
                and
                Servicing Agreement; (iii) the monthly servicing report furnished
                to the
                Trustee and (iv) the monthly reports furnished to the Certificateholders
                pursuant to Section 4.02 of the Pooling and Servicing
                Agreement.

            
	 	 	 
	 	(viii)	
              Unless
                the Underwriters shall otherwise have given their written consent,
                no
                collateralized mortgage obligations or other similar securities
                representing interests in or secured by other mortgage-related assets
                originated or owned by the Seller shall be publicly offered or sold,
                nor
                shall the Seller enter into any contractual arrangements that contemplate
                the public offering or sale of such securities, until the earlier
                to occur
                of the termination of the syndicate or the Closing
                Date.

            
	 	 	 
	 	(ix)	
              In
                connection with any transaction contemplated by this Agreement, the
                Depositor and each of its affiliates maintain customary, arm’s-length
                business relationships with each Underwriter and each of its affiliates,
                and no fiduciary duty on the part of any Underwriter or any of its
                affiliates is thereby or hereby intended or created, and the express
                disclaimer of any such fiduciary relationship on the part of each
                Underwriter and each of its affiliates is hereby acknowledged and
                accepted
                by the Depositor and each of its affiliates.

            
	 	 	 
	 	(x)	
              The
                Depositor will file or cause to be filed with the Commission such
                Free
                Writing Prospectus that is either an Issuer Free Writing Prospectus
                (as
                defined in Section 5(c) hereof) or contains Issuer Information as
                soon as
                reasonably practicable after the date of this Agreement, but in any
                event,
                not later than required pursuant to Rules 426 or 433, respectively,
                of the
                Securities Act.

            
	 	 	 
	 	(xi)	
              The
                Depositor shall not be required to file (A) any Free Writing Prospectus,
                if the information included therein is included or incorporated by
                reference in a prospectus or Free Writing Prospectus previously filed
                with
                the Commission that relates to the offering of the Certificates,
                or (B)
                any Free Writing Prospectus or portion thereof that contains a description
                of the Certificates or the offering of the Certificates which does
                not
                reflect the final terms thereof (so long as such information does
                not
                contain any Issuer Information).

            
	 	 	 
	 	(xii)	
              The
                Depositor will (i) prepare and file the report required by Item 6.05
                of
                Form 8-K within four business days after the Closing Date if any
                material
                pool characteristic in the final pool at the Closing Date varies
                by 5% or
                more from the description in the Prospectus Supplement, (ii) comply
                with
                required Form 8-K reporting requirements with respect to any prefunding
                account and (iii) if static pool information required with respect
                to the
                Underwritten Certificates is delivered via website, comply with the
                Rules
                and Regulations. The Depositor will be responsible for calculating
                the
                significance percentage of any derivative contract with respect to
                the
                Underwritten Certificates.

            
	 	 	 

    

     

    (b) 
        Each
      Underwriter severally represents, warrants, covenants and agrees with the
      Depositor as to itself that:

     

    
      	 	(i) 	
              Prior
                to entering into any Contract of Sale, the Underwriter shall convey
                the
                Preliminary Prospectus to each prospective investor. The Underwriter
                shall
                keep sufficient records to document its conveyance of the Preliminary
                Prospectus to each potential investor prior to the related Contract
                of
                Sale.

            
	 	 	 
	 	(ii)	
              Unless
                preceded or accompanied by a prospectus satisfying the requirements
                of
                Section 10(a) of the Securities Act, the Underwriter shall not convey
                or
                deliver any written communication to any person in connection with
                the
                initial offering
                of the Certificates,
                unless such written communication (1) is made in reliance on Rule
                134
                under the Securities Act, (2) constitutes a prospectus satisfying
                the
                requirements of Rule 430B under the Securities Act or (3) is a Free
                Writing Prospectus.

            
	 	 	 
	 	(iii)	
              An
                Underwriter may convey a Preliminary Term Sheet to a potential investor
                prior to entering into a Contract of Sale with such investor; provided,
                however, that (x) such Underwriter shall not enter into a Contract
                of Sale
                with such investor unless the Underwriter has complied with paragraph
                (i)
                above prior to such Contract of Sale, (y) such Underwriter shall
                deliver a
                copy of the proposed Preliminary Term Sheet to the Depositor and
                its
                counsel prior to the anticipated first use and shall not convey any
                such
                Preliminary Term Sheet to which the Depositor or its counsel reasonably
                objects.

            
	 	 	 
	 	(iv)	
              An
                Underwriter may convey Computational Materials (x) to a potential
                investor
                prior to entering into a Contract of Sale with such investor; provided,
                however, that (A) such Underwriter shall not enter into a Contract
                of Sale
                with such investor unless the Underwriter has complied with paragraph
                (i)
                above prior to such Contract of Sale and (B) such Computational Materials
                shall not be disseminated in a manner reasonably designed to lead
                to their
                broad unrestricted dissemination; provided, however, that if such
                Computational Materials are disseminated in a manner reasonably designed
                to lead to its broad unrestricted dissemination, such Underwriter
                shall
                file with the Commission such Computational Materials, and (y) to
                an
                investor after a Contract of Sale, provided that the Underwriter
                has
                complied with paragraph (i) above in connection with such Contract
                of
                Sale. The Underwriter shall keep sufficient records of any conveyance
                of
                Computational Materials to potential or actual investors and shall
                maintain such records as required by the Rules and
                Regulations.

            
	 	 	 
	 	(v) 	
              If
                an Underwriter does not furnish a Free Writing Prospectus that is
                required
                to be filed under the Securities Act to the Depositor’s counsel prior to
                the scheduled print date of the Prospectus Supplement, such Underwriter
                will be deemed to have represented that it did not convey any such
                Free
                Writing Prospectus to any potential investor.

            
	 	 	 
	 	(vi)	
              Each
                Free Writing Prospectus shall contain legends substantially similar
                to the
                following or such other legends required by applicable law as determined
                by the Underwriters:

            

    

     

    The
      depositor has filed a registration statement (including a prospectus) with
      the
      SEC for the offering to which this free writing prospectus relates. Before
      you
      invest, you should read the prospectus in that registration statement and other
      documents the depositor has filed with the SEC for more complete information
      about the depositor and this offering. You may get these documents for free
      by
      visiting EDGAR on the SEC Web site at www.sec.gov.
      Alternatively, the depositor, any underwriter or any dealer participating in
      the
      offering will arrange to send you the prospectus if you request it by calling
      toll-free 1-8[zz-zzz-zzzz].

     

    This
      free
      writing prospectus does not contain all information that is required to be
      included in the base prospectus and the prospectus supplement.

     

    The
      information in this free writing prospectus supersedes information contained
      in
      any prior similar free writing prospectus relating to these securities prior
      to
      the time of your commitment to purchase.

     

    The
      asset-backed securities referred to in this free writing prospectus are being
      offered when, as and if issued. In particular, you are advised that asset-backed
      securities, and the asset pools backing them, are subject to modification or
      revision (including, among other things, the possibility that one or more
      classes of securities may be split, combined or eliminated), at any time prior
      to issuance or availability of a final prospectus. As a result, you may commit
      to purchase securities that have characteristics that may change, and you are
      advised that all or a portion of the securities may not be issued that have
      the
      characteristics described in this free writing prospectus. Our obligation to
      sell securities to you is conditioned on the securities having the
      characteristics described in this free writing prospectus. If that condition
      is
      not satisfied, we will notify you, and neither the issuer nor [the] [any]
      underwriter will have any obligation to you to deliver all or any portion of
      the
      securities which you have committed to purchase, and there will be no liability
      between us as a consequence of the non-delivery.

     

    This
      free
      writing prospectus is being delivered to you solely to provide you with
      information about the offering of the asset-backed securities referred to in
      this free writing prospectus and to solicit an indication of your interest
      in
      purchasing such securities, when, as and if issued. Any such indication of
      interest will not constitute a contractual commitment by you to purchase any
      of
      the securities.

     

    
      	 	(vii)	
              Any
                Computational Materials shall include legends, in addition to those
                specified in paragraph (vi) above, substantially similar to the following
                or such other legends required by applicable law as determined by
                the
                Underwriters:

               

              
                The
                  information in this free writing prospectus may be based on preliminary
                  assumptions about the pool assets and the structure. Any such assumptions
                  are subject to change.

                 

                The
                  information in this free writing prospectus may reflect parameters,
                  metrics or scenarios specifically requested by you. If so, prior
                  to the
                  time of your commitment to purchase, you should request updated
                  information based on any parameters, metrics or scenarios specifically
                  required by you.

                 

                Neither
                  the depositor nor any of its affiliates prepared, provided, approved
                  or
                  verified any statistical or numerical information presented in
                  this free
                  writing prospectus, although that information may be based in part
                  on loan
                  level data provided by the depositor or its
                  affiliates.

              

            
	 	 	 
	 	(viii) 	
              On
                or before the Closing Date, the Representative shall execute and
                deliver
                to Thacher Proffitt & Wood LLP a copy of an original issue discount
                pricing letter, provided to the Representative by Thacher Proffitt
&
                Wood LLP.

            
	 	 	 
	 	(ix)	
              Each
                Underwriter severally agrees to retain all Free Writing Prospectuses
                that
                it has used and that are not required to be filed pursuant to this
                Section
                5 for a period of three years following the initial bona fide offering
                of
                the Offered Certificates.

            

    

     

    (c)  The
      following terms shall have the meanings set forth below, unless the context
      clearly indicates otherwise:

     

    Computational
      Materials:
      Any
      Free Writing Prospectus prepared by the Underwriter that contains only (i)
      information specified in paragraph (5) of the definition of ABS Informational
      and Computational Materials in Item 1101(a) of Regulation AB or (ii) information
      that is not Issuer Information.

     

    Contract
      of Sale:
      The
      meaning set forth in Rule 159 under the Securities Act.

     

    Derived
      Information:
      Such
      information, if any, in any Free Writing Prospectus prepared by any Underwriter
      that is not contained in either (i) the Registration Statement, the Base
      Prospectus, the Preliminary Prospectus or the Prospectus or amendments or
      supplements thereto, taking into account information incorporated therein by
      reference or (ii) any Pool Information.

     

    Free
      Writing Prospectus:
      A
“written communication” within the meaning of Rule 405 under the Securities Act
      that describes the Certificates and/or the Mortgage Loans.

     

    Issuer
      Information:
      Such
      information as defined in Rule 433(h) under the Securities Act and
      which
      shall not include (i) information that is merely based on or derived from such
      information or (ii) any Excluded Information.

     

    Issuer
      Free Writing Prospectus:
      The
      meaning set forth in Rule 405 of the Securities Act except that (i)
      Computational Materials shall not be an Issuer Free Writing Prospectus; (ii)
      any
      Free Writing Prospectus or portion thereof prepared by or on behalf of an
      Underwriter that includes any Issuer Information that is not approved by the
      Depositor for use therein shall not be an Issuer Free Writing Prospectus and
      (iii) no Free Writing Prospectus shall be deemed to be prepared by an
      Underwriter on behalf of the Depositor if such Free Writing Prospectus is not
      delivered to the Depositor prior to first use in accordance with Section
      5(b)(vi) hereof.

     

    Preliminary
      Term Sheet:
      A Free
      Writing Prospectus that contains information described in paragraphs (1) -
      (3)
      of the definition of ABS Informational and Computational Materials in Item
      1101(a) of Regulation AB but which does not include Derived
      Information.

     

    Static
      Pool Information:
      Such
      information as described in Item 1105 of Regulation AB, whether or not such
      information is incorporated into the Registration Statement or the
      Prospectus.

     

    (d)  (i)
      In
      the event that any Underwriter or the Depositor becomes aware that, as of the
      time of the Contract of Sale, any Free Writing Prospectus prepared by or on
      behalf of the Underwriter and delivered to a purchaser of an Offered Certificate
      contained any untrue statement of a material fact or omitted to state a material
      fact necessary in order to make the statements contained therein, in light
      of
      the circumstances under which they were made, not misleading (such Free Writing
      Prospectus, a “Defective
      Free Writing Prospectus”),
      the
      Underwriter or the Depositor shall notify the other parties to this Agreement
      thereof within one business day after discovery.

     

    (ii)
      The
      party responsible for the information to be corrected, if requested by the
      Depositor or an Underwriter, as appropriate, shall prepare a Free Writing
      Prospectus with Corrective Information that corrects the material misstatement
      in or omission from the Defective Free Writing Prospectus (such corrected Free
      Writing Prospectus, a “Corrected
      Free Writing Prospectus”).

     

    (iii)
      The
      Underwriters shall deliver the Corrected Free Writing Prospectus to each
      purchaser of an Offered Certificate which received the Defective Free Writing
      Prospectus prior to entering into an agreement to purchase any Offered
      Certificates.

     

    (iv)
      The
      Underwriters shall notify such purchaser in a prominent fashion that the prior
      agreement to purchase Offered Certificates has been terminated, and of such
      purchaser’s rights as a result of termination of such agreement.

     

    (v)
      The
      Underwriters shall provide such purchaser with an opportunity to affirmatively
      agree to purchase such Offered Certificates on the terms described in the
      Corrected Free Writing Prospectus.

     

     

    (e)  Each
      Underwriter covenants with the Depositor that after the final Prospectus is
      available the Underwriter shall not distribute any written information
      concerning the Offered Certificates to a prospective purchaser of Offered
      Certificates unless such information is preceded or accompanied by the final
      Prospectus.

     

    SECTION
      6.  Conditions
      to the Underwriters’ Obligation.
      The
      several obligations of the Underwriters hereunder to purchase the Underwritten
      Certificates pursuant to this Agreement are subject to the following conditions
      as of the Closing Date:

     

    (a)  Each
      of
      the obligations of the Depositor required to be performed by it on or prior
      to
      the Closing Date pursuant to the terms of the Agreements shall have been duly
      performed and complied with and all of the representations and warranties of
      the
      Depositor under any of the Agreements shall be true and correct as of the
      Closing Date and no event shall have occurred which, with notice or the passage
      of time, would constitute a default under any of the Agreements, and the
      Underwriters shall have received certificates to the effect of the foregoing,
      each signed by an authorized officer of the Depositor.

     

    (b)  Prior
      to
      the Closing Date, (i) the Depositor shall have received confirmation of the
      effectiveness of the Registration Statement and (ii) no stop order suspending
      the effectiveness of the Registration Statement shall have been issued and
      no
      proceedings for that purpose shall have been instituted or, to the knowledge
      of
      the Depositor, shall be contemplated by the Commission. Any request of the
      Commission for inclusion of additional information in the Registration Statement
      or the Prospectus shall have been complied with.

     

    (c)  The
      Mortgage Loans will be acceptable to the following rating agencies (each, a
      “Rating Agency”): Fitch Ratings (“Fitch”), Standard & Poor’s Ratings
      Services, a division of The McGraw-Hill Companies Inc. (“S&P”) and Moody’s
      Investor Service, Inc. (“Moody’s”).

     

    (d)  The
      Underwriters shall have received the following additional closing documents,
      in
      form and substance satisfactory to the Underwriters and their
      counsel:

     

    
      	 	(i)	
              the
                Agreements and all documents required thereunder, duly executed and
                delivered by each of the parties thereto other than the Underwriters
                and
                their affiliates;

            
	 	 	 
	 	(ii)	
              an
                officer’s certificate of an officer of the Seller and an officer’s
                certificate of an officer of the Depositor, in each case dated as
                of the
                Closing Date and reasonably satisfactory in form and substance to
                the
                Underwriters and counsel for the Underwriters with resolutions of
                the
                applicable board of directors and a copy of the formation documents
                of the
                Seller or the Depositor, as applicable;

            
	 	 	 
	 	(iii)	
              an
                opinion of in-house counsel to the Seller, reasonably satisfactory
                in form
                and substance to the Underwriters and counsel for the Underwriters,
                dated
                the Closing Date, as to various matters;

            
	 	 	 
	 	(iv)	
              an
                opinion of Thacher Proffitt & Wood LLP, counsel to the Depositor,
                dated the Closing Date, reasonably satisfactory in form and substance
                to
                the Underwriters and counsel for the Underwriters, as to various
                matters;

            
	 	 	 
	 	(v) 	
              an
                opinion of McKee Nelson LLP, counsel to the Underwriters, dated the
                Closing Date, reasonably satisfactory in form and substance to the
                Underwriters, as to various matters;

            
	 	 	 
	 	(vi)	
              such
                opinions of Thacher Proffitt & Wood LLP, counsel to the Depositor, in
                forms reasonably satisfactory to the Underwriters, their counsel
                and each
                Rating Agency, as to such additional matters not opined to in the
                opinion
                delivered pursuant to clause (iv) above as shall be required for
                the
                assignment of a rating to each Class of Underwritten Certificates
                by each
                Rating Agency (as to each, the “Required Ratings”) as set forth in the
                Prospectus Supplement;

            
	 	 	 
	 	(vii) 	
              a
                letter from each Rating Agency that it has assigned the applicable
                Required Ratings;

            
	 	 	 
	 	(viii)	
              a
                letter, dated the Closing Date, from each of Thacher Proffitt & Wood
                LLP, counsel to the Depositor, and McKee Nelson LLP, counsel to the
                Underwriters, providing negative assurance with respect to the Preliminary
                Prospectus as of its date and as of the date hereof and with respect
                to
                the Prospectus, as of its date and as of the Closing
                Date;

            
	 	 	 
	 	(ix)	
              letters
                dated on or before the date on which the Preliminary Prospectus is
                dated
                and conveyed, in form and substance acceptable to the Underwriters
                and
                their counsel and addressed to the Underwriters, prepared by Deloitte
                & Touche LLP (a) regarding certain numerical information contained
                or
                incorporated by reference in the Preliminary Prospectus and (b) relating
                to certain agreed upon procedures as requested by the Underwriters
                relating to the Mortgage Loans;

            
	 	 	 
	 	(x)	
              letters
                dated on or before the date on which the Prospectus is dated and
                printed,
                in form and substance acceptable to the Underwriters and their counsel
                and
                addressed to the Underwriters, prepared by Deloitte & Touche LLP (a)
                regarding certain numerical information contained or incorporated
                by
                reference in the Prospectus and (b) relating to certain agreed upon
                procedures as requested by the Underwriters relating to the Mortgage
                Loans;

            
	 	 	 
	 	(xi) 	
              an
                opinion of counsel to the Trustee, dated the Closing Date, in form
                and
                substance reasonably satisfactory to the Underwriters, their counsel
                and
                each Rating Agency; and

            
	 	 	 
	 	(xii)	
              an
                officer’s certificate of an officer of the Trustee, dated as of the
                Closing Date, reasonably satisfactory in form and substance to the
                Underwriters and their counsel.

            

    

     

    (e)  All
      proceedings in connection with the transactions contemplated by this Agreement
      and all documents incident hereto shall be reasonably satisfactory in form
      and
      substance to the Underwriters and their counsel.

     

    (f)  The
      Seller and the Depositor shall have furnished the Underwriters with such other
      certificates of its officers or others and such other documents or opinions
      as
      the Underwriters or their counsel may reasonably request.

     

    (g)  Subsequent
      to the execution and delivery of this Agreement none of the following shall
      have
      occurred: (i) trading in securities generally on the New York Stock Exchange,
      the American Stock Exchange or the over-the-counter market shall have been
      suspended or minimum prices shall have been established on either of such
      exchanges or such market by the Commission, by such exchange or by any other
      regulatory body or governmental authority having jurisdiction; (ii) a banking
      moratorium shall have been declared by Federal or New York State authorities;
      (iii) the United States shall have become engaged in material hostilities,
      there
      shall have been an escalation of such hostilities involving the United States
      or
      there shall have been a declaration of war by the United States; (iv) a material
      disruption in settlement or clearing operations shall occur; or (v) there shall
      have occurred such a material adverse change in general economic, political
      or
      financial conditions (or the effect of international conditions on the financial
      markets of the United States shall be such) which is material and adverse,
      and
      in the case of any of the events specified in clauses (i) through (v), either
      individually or together with any other such event specified in clauses (i)
      through (v) makes it in the judgment of the Underwriters, impractical to market
      the Underwritten Certificates.

     

    (h)  There
      shall not have occurred any development that has caused a material adverse
      change in the financial condition or business operations of the Seller or the
      Depositor which adverse change makes it impractical to market the Underwritten
      Certificates.

     

    (i)  The
      Interest Rate Swap Agreement and the Swap Administration Agreement shall have
      been executed and delivered.

     

    (j)  The
      Depositor will comply with Regulation AB in all respects as it relates to the
      Depositor.

     

    (k)  The
      Depositor shall have delivered to the Underwriters (i) a letter from the
      Depositor’s registered accountants dated as of a date not more than 135 days
      prior to the date of first use of the Prospectus Supplement, relating to certain
      agreed upon procedures as requested by the Depositor with respect to the Static
      Pool Information included in or incorporated by reference into the Prospectus
      Supplement for securitized assets issued on or after January 1, 2006 and (ii)
      a
      letter from the Depositor’s registered accountants dated as of the date of the
      Prospectus Supplement, addressed to the Underwriters and providing for reliance
      on the letter described in (i) of this clause (k).

     

    (l)  If
      any
      condition specified in this Section 6 shall have not been fulfilled when and
      as
      required to be fulfilled, this Agreement may be terminated by the Underwriters
      by notice to the Depositor at any time at or prior to the Closing Date, and
      such
      termination shall be without liability of any party to any other party except
      as
      provided in Sections 7, 8 and 19.

     

    SECTION
      7.  Payment
      of Expenses.
      The
      Depositor agrees to pay:

     

    
      	 	(i)	
              the
                costs incident to the authorization, issuance, sale and delivery
                of the
                Certificates and any taxes payable in connection therewith; (ii)
                the costs
                incident to the preparation, printing and filing under the Securities
                Act
                of the Registration Statement and any amendments and exhibits thereto
                and
                any Issuer Free Writing Prospectus; (iii) the costs of distributing
                the
                Registration Statement as originally filed and each amendment thereto
                and
                any post-effective amendments thereof (including, in each case, exhibits),
                the Preliminary Prospectus, the Prospectus and any amendment or supplement
                to the Prospectus or any document incorporated by reference therein
                and
                any Issuer Free Writing Prospectus, all as provided in this Agreement;
                (iv) the costs of reproducing and distributing this Agreement; (v)
                any
                fees charged by securities rating services for rating the Underwritten
                Certificates; (vi) the cost of accountants’ comfort letters relating to
                the Preliminary Prospectus and the Prospectus (except as otherwise
                agreed
                in a separate letter agreement between the Seller and the Underwriters);
                (vii) all other costs and expenses incidental to the performance
                of the
                obligations of the Depositor and the Seller (including costs and
                expenses
                of counsel to the Depositor and the Seller) and (viii) to the extent
                set
                forth in the second succeeding paragraph, the costs and expenses
                of the
                Underwriters.

            

    

     

    The
      Underwriters shall be solely responsible for any due diligence expenses incurred
      by them, any transfer taxes on the Underwritten Certificates which they may
      sell, the expenses of advertising any offering of the Underwritten Certificates
      made by the Underwriters, the cost of any accountants’ comfort letters relating
      to any Computational Materials and the costs and expenses of counsel to the
      Underwriters.

     

    If
      this
      Agreement is terminated because of a breach of the Depositor of any covenant
      or
      agreement hereunder (other than the failure of the closing condition set forth
      in Section 6(h) to be met), the Depositor shall cause the Underwriters to be
      reimbursed for all reasonable out-of-pocket expenses, including fees and
      disbursements of McKee Nelson LLP, counsel for the Underwriters.

     

    SECTION
      8.  Indemnification
      and Contribution.

     

    (a)  The
      Depositor indemnifies and holds harmless each Underwriter, each Underwriter’s
      respective officers and directors and each person, if any, who controls any
      Underwriter within the meaning of Section 15 of the Securities Act or Section
      20
      of the Exchange Act, as follows:

     

    
      	 	(i)	
              against
                any and all losses, claims, expenses, damages or liabilities, joint
                or
                several, to which such Underwriter, its officers, directors or such
                controlling person may become subject under the Securities Act or
                otherwise, insofar as such losses, claims, damages or liabilities
                (or
                actions in respect thereof including, but not limited to, any loss,
                claim,
                expense, damage or liability related to purchases and sales of the
                Underwritten Certificates) arise out of or are based upon any untrue
                statement or alleged untrue statement of any material fact contained
                in
                the Registration Statement, the Preliminary Prospectus, the Prospectus,
                any Issuer Free Writing Prospectus, any amendment or supplement to
                any of
                the foregoing or the Static Pool Information, or arise out of, or
                are
                based upon, the omission or alleged omission to state therein a material
                fact required to be stated therein or necessary to make the statements
                made therein not misleading; and will reimburse each Underwriter
                and each
                such controlling person for any legal or other expenses reasonably
                incurred by such Underwriter or such controlling person in connection
                with
                investigating or defending any such loss, claim, damage, liability
                or
                action as such expenses are incurred; provided, however, that the
                Depositor will not be liable in any such case to the extent that
                any such
                loss, claim, damage or liability arises out of or is based upon an
                untrue
                statement or omission, or alleged untrue statement or omission, made
                in
                any of such documents: (x) under the defined term “Modeling Assumptions”
                under the caption “Yield on the Certificates—Weighted Average Lives,” the
                table entitled “—Assumed Mortgage Loan Characteristics” and the tables
                entitled “—Percent of Original Certificate Principal Balance Outstanding”
                (collectively, the “Excluded Information”); (y) in reliance upon and in
                conformity with any Underwriters’ Information; or (z) in any Derived
                Information, except in the case of clause (x) or (z) to the extent
                that
                any untrue statement or alleged untrue statement or omission therein
                results (or is alleged to have resulted) from an error or material
                omission in the information either in the Preliminary Prospectus
                or the
                Prospectus for which the Depositor is responsible or concerning the
                characteristics of the Mortgage Loans furnished by the Seller to
                the
                Underwriters for use in the preparation of any Excluded Information
                or any
                Free Writing Prospectus; provided, however, that no indemnity shall
                be
                provided by either the Depositor or the Seller for any error that
                was
                superseded or corrected by delivery to the Underwriters of corrected
                written or electronic information prior to the first Contract of
                Sale or
                for which the Seller or the Depositor provided written notice of
                such
                error to the Underwriters prior to the first Contract of Sale and
                the
                Underwriters failed to correct such error;

            
	 	 	 
	 	(ii)	
              against
                any and all loss, liability, claim, damage and expense whatsoever,
                to the
                extent of the aggregate amount paid in settlement of any litigation,
                or
                investigation or proceeding by any governmental agency or body, commenced
                or threatened, or of any claim whatsoever based upon any such untrue
                statement or omission, or any such alleged untrue statement or omission,
                if such settlement is effected with the written consent of the Depositor;
                and

            
	 	 	 
	 	(iii)	
              against
                any and all expense whatsoever (including the fees and disbursements
                of
                counsel chosen by any such Underwriter), reasonably incurred in
                investigating, preparing or defending against any litigation, or
                investigation or proceeding by any governmental agency or body, commenced
                or threatened, or any claim whatsoever based upon any such untrue
                statement or omission, or any such alleged untrue statement or omission,
                to the extent that any such expense is not paid under clause (i)
                or clause
                (ii) above.

            

    

     

    This
      indemnity agreement will be in addition to any liability which the Depositor
      may
      otherwise have.

     

    (b)  Each
      Underwriter, severally and not jointly, agrees to indemnify and hold harmless
      each of the Depositor, each of its directors, each of its officers and each
      person, if any, who controls the Depositor within the meaning of Section 15
      of
      the Securities Act or Section 20 of the Exchange Act, against any and all
      losses, claims, expenses, damages or liabilities to which the Depositor or
      any
      such director, officer or controlling person may become subject, under the
      Securities Act or otherwise, insofar as such losses, claims, damages or
      liabilities (or actions in respect thereof) arise out of or are based upon
      any
      untrue statement or alleged untrue statement of any material fact contained
      in
      (i) Derived Information and (ii) the Registration Statement, the Preliminary
      Prospectus, the Prospectus, or any amendment or supplement thereto, or arise
      out
      of, or are based upon, the omission or the alleged omission to state therein
      a
      material fact required to be stated therein or necessary to make the statements
      made therein not misleading, but with respect to clause (b)(ii) above, only
      to
      the extent that such untrue statement or alleged untrue statement or omission
      or
      alleged omission was made in reliance upon and in conformity with the
      Underwriters’ Information of such Underwriter; and will reimburse any legal or
      other expenses reasonably incurred by the Depositor or any such director,
      officer or controlling person in connection with investigating or defending
      any
      such loss, claim, damage, liability or action. This indemnity agreement will
      be
      in addition to any liability which such Underwriter may otherwise
      have.

     

    (c)  Promptly
      after receipt by an indemnified party under this Section 8 of notice of the
      commencement of any action described therein, such indemnified party will,
      if a
      claim in respect thereof is to be made against the indemnifying party under
      this
      Section 8, notify the indemnifying party of the commencement thereof; but the
      omission to so notify the indemnifying party will not relieve the indemnifying
      party from any liability that it may have to any indemnified party otherwise
      than under this Section 8; provided, however, that the failure to notify the
      indemnifying party under this Section 8(c) shall not eliminate the contribution
      requirement of the indemnifying party under Section 8(d) unless the failure
      to
      notify under this Section 8(c) is materially adverse to the indemnifying party.
      In case any such action is brought against any indemnified party, and it
      notifies the indemnifying party of the commencement thereof, the indemnifying
      party will be entitled to participate therein, and, to the extent that it may
      wish to do so, jointly with any other indemnifying party similarly notified,
      to
      assume the defense thereof, with counsel satisfactory to such indemnified party
      (who shall not, except with the consent of the indemnified party, be counsel
      to
      the indemnifying party), and, after notice from the indemnifying party to such
      indemnified party under this Section 8, such indemnifying party shall not be
      liable for any legal or other expenses subsequently incurred by such indemnified
      party in connection with the defense thereof other than reasonable costs of
      investigation.

     

    Any
      indemnified party shall have the right to employ separate counsel in any such
      action and to participate in the defense thereof, but the fees and expenses
      of
      such counsel shall be at the expense of such indemnified party unless: (i)
      the
      employment thereof has been specifically authorized by the indemnifying party
      in
      writing; (ii) such indemnified party shall have been advised by such counsel
      that there may be one or more legal defenses available to it which are different
      from or additional to those available to the indemnifying party and in the
      reasonable judgment of such counsel it is advisable for such indemnified party
      to employ separate counsel; (iii) a conflict or potential conflict exists (based
      on advice of counsel to the indemnified party) between the indemnified party
      and
      the indemnifying party (in which case the indemnifying party will not have
      the
      right to direct the defense of such action on behalf of the indemnified party);
      or (iv) the indemnifying party has failed to assume the defense of such action
      and employ counsel reasonably satisfactory to the indemnified party, in which
      case, if such indemnified party notifies the indemnifying party in writing
      that
      it elects to employ separate counsel at the expense of the indemnifying party,
      the indemnifying party shall not have the right to assume the defense of such
      action on behalf of such indemnified party, it being understood, however, the
      indemnifying party shall not, in connection with any one such action or separate
      but substantially similar or related actions in the same jurisdiction arising
      out of the same general allegations or circumstances, be liable for the
      reasonable fees and expenses of more than one separate firm of attorneys (in
      addition to local counsel) at any time for all such indemnified parties, which
      firm shall be designated in writing by the related Underwriter, if the
      indemnified parties under this Section 8 consist of one Underwriter or any
      of
      its controlling persons, by the Representative, if the indemnified parties
      under
      this Section 8 consist of more than one Underwriter or their controlling
      persons, or by the Depositor, if the indemnified parties under this Section
      8
      consist of the Depositor or any of the Depositor’s directors, officers or
      controlling persons.

     

    Each
      indemnified party, as a condition of the indemnity agreements contained in
      Section 8(a) and Section 8(b), shall use its good faith efforts to cooperate
      with the indemnifying party in the defense of any such action or claim. No
      indemnifying party shall be liable for any settlement of any such action
      effected without its written consent (which consent shall not be unreasonably
      withheld), but if settled with its written consent or if there be a final
      judgment for the plaintiff in any such action, the indemnifying party agrees
      to
      indemnify and hold harmless any indemnified party from and against any loss
      or
      liability (to the extent set forth in Section 8(a) or Section 8(b) as
      applicable) by reason of such settlement or judgment.

     

    Notwithstanding
      the foregoing paragraph, if at any time an indemnified party shall have
      requested an indemnifying party to reimburse the indemnified party for fees
      and
      expenses of counsel, the indemnifying party agrees that it shall be liable
      for
      any settlement of any proceeding effected without its written consent if (i)
      such settlement is entered into more than 30 days after receipt by such
      indemnifying party of the aforesaid request and (ii) such indemnifying party
      shall not have reimbursed the indemnified party in accordance with such request
      prior to the date of such settlement.

     

     

    (d)  If
      the
      indemnification provided for in Section 8(a) or 8(b) is unavailable or
      insufficient to hold harmless an indemnified party under subsection (a) or
      (b)
      above, then each indemnifying party shall contribute to the amount paid or
      payable by such indemnified party as a result of the losses, claims, damages
      or
      liabilities referred to in subsection (a) or (b) above (i) in such proportion
      as
      is appropriate to reflect the relative benefits received by the Depositor on
      the
      one hand and the Underwriters on the other from the offering of the Underwritten
      Certificates or (ii) if the allocation provided by clause (i) above is not
      permitted by applicable law, in such proportion as is appropriate to reflect
      not
      only the relative benefits referred to in clause (i) above but also the relative
      fault of the Depositor on the one hand and the Underwriters on the other in
      connection with the statements or omissions which resulted in such losses,
      claims, damages or liabilities as well as any other relevant equitable
      considerations. The relative benefits received by the Depositor on the one
      hand
      and the Underwriters on the other shall be deemed to be in the same proportion
      as the total net proceeds from the offering (before deducting expenses) received
      by the Depositor bear to the total underwriting discounts and commissions
      received by the Underwriters. The relative fault shall be determined by
      reference to, among other things, whether the untrue or alleged untrue statement
      of a material fact or the omission or alleged omission to state a material
      fact
      relates to information supplied by the Depositor or by the Underwriters and
      the
      parties’ relative intent, knowledge, access to information and opportunity to
      correct or prevent such untrue statement or omission. The amount paid by an
      indemnified party as a result of the losses, claims, damages or liabilities
      referred to above in the first sentence of this subsection (d) shall be deemed
      to include any legal or other expenses reasonably incurred by such indemnified
      party in connection with investigating or defending any action or claim which
      is
      the subject of this subsection (d). Notwithstanding the provisions of this
      subsection (d), no Underwriter shall be required to contribute any amount in
      excess of underwriting discounts and commissions received by such Underwriter.
      No person guilty of fraudulent misrepresentation (within the meaning of Section
      11(f) of the Securities Act) shall be entitled to contribution from any person
      who was not guilty of such fraudulent misrepresentation. The Underwriters’
obligations in this subsection (d) to contribute are several in proportion
      to
      their respective underwriting obligations and not joint.

     

    SECTION
      9.  Representations,
      Warranties and Agreements to Survive Delivery.
      All
      representations, warranties and agreements contained in this Agreement or
      contained in certificates of officers of the Depositor or the Seller submitted
      pursuant hereto shall remain operative and in full force and effect, regardless
      of any investigation made by or on behalf of the Underwriters or controlling
      persons thereof, or by or on behalf of the Depositor or the Seller, and shall
      survive delivery of any Underwritten Certificates to the
      Underwriters.

     

    SECTION
      10.  Default
      by One or More of the Underwriters.
      If one
      or more of the Underwriters participating in the public offering of the
      Underwritten Certificates shall fail at the Closing Date to purchase the
      Underwritten Certificates which it is (or they are) obligated to purchase
      hereunder (the “Defaulted Certificates”), then the non-defaulting Underwriters
      shall have the right, within 24 hours thereafter, to make arrangements for
      one
      or more of the non-defaulting Underwriters, or any other underwriters, to
      purchase all, but not less than all, of the Defaulted Certificates in such
      amounts as may be agreed upon and upon the terms herein set forth. If, however,
      the Underwriters have not completed such arrangements within such 24-hour
      period, then

     

    (a)  if
      the
      aggregate principal amount of Defaulted Certificates does not exceed 10% of
      the
      aggregate principal amount of the Underwritten Certificates to be purchased
      pursuant to this Agreement, the non-defaulting Underwriters named in this
      Agreement shall be obligated to purchase the full amount thereof in the
      proportions that their respective underwriting obligations hereunder bear to
      the
      underwriting obligations of all such non-defaulting Underwriters,
      or

     

    (b)  if
      the
      aggregate principal amount of Defaulted Certificates exceeds 10% of the
      aggregate principal amount of the Underwritten Certificates to be purchased
      pursuant to this Agreement, this Agreement shall terminate, without any
      liability on the part of any non-defaulting Underwriter.

     

    No
      action
      taken pursuant to this Section 10 shall relieve any defaulting Underwriter
      from
      the liability with respect to any default of such Underwriter under this
      Agreement.

     

    In
      the
      event of a default by any Underwriter as set forth in this Section 10, each
      of
      the Underwriters and the Depositor shall have the right to postpone the Closing
      Date for a period not exceeding five Business Days in order that any required
      changes in the Registration Statement or Prospectus or in any other documents
      or
      arrangements may be effected.

     

    SECTION
      11.  Termination
      of Agreement.
      The
      Underwriters may terminate this Agreement immediately upon notice to the
      Depositor, at any time at or prior to the Closing Date if the events set forth
      in Section 6(h) of this Agreement shall occur and be continuing, or if any
      other
      closing condition set forth in Section 6 shall not have been fulfilled when
      required to be fulfilled. In the event of any such termination, the provisions
      of Section 7, Section 8, Section 9, Section 14, Section 16 and Section 19 shall
      remain in effect.

     

    SECTION
      12.  Notices.
      All
      statements, requests, notices and agreements hereunder shall be in writing,
      and:

     

    (a)  if
      to the
      Underwriters, shall be delivered or sent to the Representative at J.P. Morgan
      Securities Inc., 270 Park Avenue, New York, New York 10017, Attention:
      Legal;

     

    (b)  if
      to the
      Depositor, shall be delivered or sent by mail, telex or facsimile transmission
      to care of Argent Securities Inc., 1100 Town & Country Road, Suite 1100,
      Orange, California 92868, Facsimile (714) 564-9639, Attention: General Counsel;
      and

     

    (c)  if
      to the
      Seller, shall be delivered or sent by mail, telex or facsimile transmission
      to
      care of Ameriquest Mortgage Company, 1100 Town & Country Road, Suite 1100,
      Orange, California 92868, Facsimile (714) 564-9639, Attention: General
      Counsel.

     

    SECTION
      13.  Persons
      Entitled to the Benefit of this Agreement.
      This
      Agreement shall inure to the benefit of and be binding upon the Underwriters,
      the Seller and the Depositor, and their respective successors. This Agreement
      and the terms and provisions hereof are for the sole benefit of only those
      persons, except that the representations, warranties, indemnities and agreements
      contained in this Agreement shall also be deemed to be for the benefit of the
      person or persons, if any, who control any of the Underwriters within the
      meaning of Section 15 of the Securities Act, and for the benefit of each
      Underwriter’s respective officers and directors and for the benefit of directors
      of the Depositor, officers of the Depositor who have signed the Registration
      Statement and any person controlling the Depositor within the meaning of Section
      15 of the Securities Act. Nothing in this Agreement is intended or shall be
      construed to give any person, other than the persons referred to in this Section
      13, any legal or equitable right, remedy or claim under or in respect of this
      Agreement or any provision contained herein.

     

    SECTION
      14.  Survival.
      The
      respective indemnities, representations, warranties and agreements of the
      Depositor, the Seller and the Underwriters contained in this Agreement, or
      made
      by or on behalf of them, respectively, pursuant to this Agreement, shall survive
      the delivery of and payment for the Underwritten Certificates and shall remain
      in full force and effect, regardless of any investigation made by or on behalf
      of any of them or any person controlling any of them.

     

    SECTION
      15.  Definition
      of the Term “Business Day”.
      For
      purposes of this Agreement, “Business Day” means any day on which the New York
      Stock Exchange is open for trading.

     

    SECTION
      16.  Governing
      Law; Submission to Jurisdiction.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York, without regard to principles of conflicts of law other than
      Section 5-1401 of the New York General Obligations Law which shall
      govern.

     

    The
      parties hereto hereby submit to the non-exclusive jurisdiction of the United
      States District Court for the Southern District of New York and any court in
      the
      State of New York located in the City and County of New York, and appellate
      court from any thereof, in any action, suit or proceeding brought against it
      or
      in connection with this Agreement or any of the related documents or the
      transactions contemplated hereunder or for recognition or enforcement of any
      judgment, and the parties hereto hereby agree that all claims in respect of
      any
      such action or proceeding may be heard or determined in New York State court
      or,
      to the extent permitted by law, in such federal court. The parties hereto hereby
      irrevocably waive, to the fullest extent permitted by law, any and all rights
      to
      trial by jury in any legal proceeding arising out of or relating to this
      Agreement or the transactions contemplated hereby.

     

    SECTION
      17.  Counterparts.
      This
      Agreement may be executed in counterparts and, if executed in more than one
      counterpart, the executed counterparts shall each be deemed to be an original
      but all such counterparts shall together constitute one and the same
      instrument.

     

    SECTION
      18.  Headings.
      The
      headings herein are inserted for convenience of reference only and are not
      intended to be part of, or to affect the meaning or interpretation of, this
      Agreement.

     

    SECTION
      19.  Obligations
      of the Seller.
      The
      Seller agrees with the Underwriters, for the sole and exclusive benefit of
      each
      such Underwriter, each such Underwriter’s officers and directors and each person
      controlling such Underwriter within the meaning of the Securities Act, and
      not
      for the benefit of any assignee thereof or any other person or persons dealing
      with such Underwriter as follows: in consideration of and as an inducement
      to
      their agreement to purchase the Underwritten Certificates from the Depositor,
      to
      indemnify and hold harmless each Underwriter against any failure by the
      Depositor to perform its obligations to the Underwriters hereunder, including,
      without limitation, any failure by the Depositor to honor any obligation to
      any
      Underwriter pursuant to Sections 8 and 14 (with respect to the survival of
      indemnities) hereof. In the case of any claim against the Seller by any
      Underwriter, any officer or director of any Underwriter or any person
      controlling any Underwriter, it shall not be necessary for such claimant to
      first pursue any remedy from or exhaust any proceedings against the
      Depositor.

     

    
      
        
           

          

          

        

         

      

      
         

        
          

        

      

      
         

        
        

      

    

    If
      the
      foregoing correctly sets forth the agreement among the Depositor, the Seller
      and
      the Underwriters, please indicate your acceptance in the space provided for
      the
      purpose below.

     

    
      	 	Very truly yours,	 
	 	 	 	 
	 	ARGENT SECURITIES
              INC.	 
	 	 	 	 
	 	By:	 	 
	 	Name:	 	 
	 	Title:	 	 
	 	 	 	 
	 	AMERIQUEST MORTGAGE
              COMPANY	 
	 	 	 	 
	 	By:	 	 
	 	Name:	 	 
	 	Title:	 	 

    

     

     

    CONFIRMED
      AND ACCEPTED, as of the date first above written:

     

    J.P.
      MORGAN SECURITIES INC., 

    acting
      on
      its own behalf and as Representative

    of
      the
      several Underwriters referred to in

    the
      foregoing Agreement

     

    
      	By:	 	 
	Name:	 	 
	Title:	 	 

    

         

    

      
        
          
             

            

            

          

           

        

        
           

          
            

          

        

        
           

          
          

        

      

    
      	
              Underwriters

            	 	
              Principal
                Amount 

            	 	
              Proceeds
                to the Depositor

            	 
	
               J.P.
                Morgan Securities Inc.

            	 	 	 	 	 
	
              Class
                A-1

            	 	
              $

            	
              256,775,850.00

            	 	 	
              99.88%

            	
               

            
	
              Class
                A-2A

            	 	
              $

            	
              111,843,000.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                A-2B

            	 	
              $

            	
              53,028,900.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                A-2C

            	 	
              $

            	
              54,102,600.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                A-2D

            	 	
              $

            	
              38,435,400.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-1

            	 	
              $

            	
              22,063,950.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-2

            	 	
              $

            	
              19,505,700.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-3

            	 	
              $

            	
              12,470,850.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-4

            	 	
              $

            	
              10,872,000.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-5

            	 	
              $

            	
              10,552,500.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-6

            	 	
              $

            	
              8,953,650.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-7

            	 	
              $

            	
              8,633,700.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-8

            	 	
              $

            	
              7,674,300.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-9

            	 	
              $

            	
              4,796,550.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-10

            	 	
              $

            	
              6,395,400.00

            	 	 	
              88.13%

            	
               

            
	
              Banc
                of America Securities LLC

            	 	
               

            	 	 	 	
               

            	
            
	
              Class
                A-1

            	 	
              $

            	
              256,775,850.00

            	 	 	
              99.88%

            	
               

            
	
              Class
                A-2A

            	 	
              $

            	
              111,843,000.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                A-2B

            	 	
              $

            	
              53,028,900.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                A-2C

            	 	
              $

            	
              54,102,600.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                A-2D

            	 	
              $

            	
              38,435,400.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-1

            	 	
              $

            	
              22,063,950.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-2

            	 	
              $

            	
              19,505,700.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-3

            	 	
              $

            	
              12,470,850.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-4

            	 	
              $

            	
              10,872,000.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-5

            	 	
              $

            	
              10,552,500.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-6

            	 	
              $

            	
              8,953,650.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-7

            	 	
              $

            	
              8,633,700.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-8

            	 	
              $

            	
              7,674,300.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-9

            	 	
              $

            	
              4,796,550.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-10

            	 	
              $

            	
              6,395,400.00

            	 	 	
              88.13%

            	
               

            
	
              Merrill
                Lynch, Pierce, Fenner & Smith
                Incorporated

            	 	
               

            	 	 	 	
               

            	
            
	
              Class
                A-1

            	 	
              $

            	
              57,061,300.00

            	 	 	
              99.88%

            	
               

            
	
              Class
                A-2A

            	 	
              $

            	
              24,854,000.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                A-2B

            	 	
              $

            	
              11,784,200.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                A-2C

            	 	
              $

            	
              12,022,800.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                A-2D

            	 	
              $

            	
              8,541,200.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-1

            	 	
              $

            	
              4,903,100.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-2

            	 	
              $

            	
              4,334,600.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-3

            	 	
              $

            	
              2,771,300.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-4

            	 	
              $

            	
              2,416,000.00

            	 	 	
              99.85%%

            	
               

            
	
              Class
                M-5

            	 	
              $

            	
              2,345,000.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-6

            	 	
              $

            	
              1,989,700.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-7

            	 	
              $

            	
              1,918,600.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-8

            	 	
              $

            	
              1,705,400.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-9

            	 	
              $

            	
              1,065,900.00

            	 	 	
              99.85%

            	
               

            
	
              Class
                M-10

            	 	
              $

            	
              1,421,200.00

            	 	 	
              88.13%

            	
               

            

    

    

    
      
        
           

          

          

        

         

      

      
         

        
          

        

      

      
         

        
        

      

    

    EXHIBIT
      A

     

    Underwriters’
      Information

     

     

    METHOD
      OF
      DISTRIBUTION

    Subject
      to the terms and conditions set forth in the Underwriting Agreement, dated
      the
      date of this prospectus supplement (the “Underwriting Agreement”), the Depositor
      has agreed to sell, and each of the Underwriters severally has agreed to
      purchase the portion of the Offered Certificates set forth opposite their
      respective names. Each Underwriter is obligated to purchase all of its allocated
      portion of the Offered Certificates, if it purchases any.

     

    
      	
              Underwriters

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class A-1

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class A-2A

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class A-2B

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class A-2C

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class A-2D

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-1

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-2

              Certificates
                ($)

            
	
              J.P.
                Morgan Securities Inc.

            	
              256,775,850

            	
              111,843,000

            	
              53,028,900

            	
              54,102,600

            	
              38,435,400

            	
              22,063,950

            	
              19,505,700

            
	 	 	 	 	 	 	 	 
	
              Banc
                of America Securities LLC

            	
              256,775,850

            	
              111,843,000

            	
              53,028,900

            	
              54,102,600

            	
              38,435,400

            	
              22,063,950

            	
              19,505,700

            
	 	 	 	 	 	 	 	 
	
              Merrill
                Lynch, Pierce, Fenner & Smith Incorporated

            	
              57,061,300

            	
              24,854,000

            	
              11,784,200

            	
              12,022,800

            	
              8,541,200

            	
              4,903,100

            	
              4,334,600

            

    

    

    

    
      	
              Underwriters

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-3

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-4

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-5

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-6

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-7

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-8

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-9

              Certificates
                ($)

            	
              Original

              Certificate

              Principal

              Balance
                of

              the
                Class M-10

              Certificates
                ($)

            
	
              J.P.
                Morgan Securities Inc.

            	
              12,470,850

            	
              10,872,000

            	
              10,552,500

            	
              8,953,650

            	
              8,633,700

            	
              7,674,300

            	
              4,796,550

            	
              6,395,400

            
	 	 	 	 	 	 	 	 	 
	
              Banc
                of America Securities LLC

            	
              12,470,850

            	
              10,872,000

            	
              10,552,500

            	
              8,953,650

            	
              8,633,700

            	
              7,674,300

            	
              4,796,550

            	
              6,395,400

            
	 	 	 	 	 	 	 	 	 
	
              Merrill
                Lynch, Pierce, Fenner & Smith Incorporated

            	
              2,771,300

            	
              2,416,000

            	
              2,345,000

            	
              1,989,700

            	
              1,918,600

            	
              1,705,400

            	
              1,065,900

            	
              1,421,200

            

    

     

    The
      Depositor has been advised by the Underwriters that they propose initially
      to
      offer the Offered Certificates of each class to the public at the offering
      price
      set forth on the cover page and to certain dealers at such price less a selling
      concession, not in excess of the percentage set forth in the table below of
      the
      Certificate Principal Balance of the related class of Offered
      Certificates.
      The
      Underwriters may allow and such dealers may reallow a reallowance discount,
      not
      in excess of the percentage set forth in the table below of the Certificate
      Principal Balance of the related class of Offered Certificates, to certain
      other
      dealers.
      After
      the initial public offering, the public offering prices, such concessions and
      such discounts may be changed.

     

    
      	
              Class
                of Certificates

            	
              Selling
                Concession

            	
              Reallowance
                Discount

            
	
              Class
                A-1

            	
              0.0720%

            	
              0.0360%

            
	
              Class
                A-2A

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                A-2B

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                A-2C

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                A-2D

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-1

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-2

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-3

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-4

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-5

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-6

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-7

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-8

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-9

            	
              0.0900%

            	
              0.0450%

            
	
              Class
                M-10

            	
              0.0900%

            	
              0.0450%

            

    

    

    Until
      the
      distribution of the Offered Certificates is completed, rules of the SEC may
      limit the ability of the Underwriters and certain selling group members to
      bid
      for and purchase the Offered Certificates. As an exception to these rules,
      the
      Underwriters are permitted to engage in certain transactions that stabilize
      the
      price of the Offered Certificates. Such transactions consist of bids or
      purchases for the purpose of pegging, fixing or maintaining the price of the
      Offered Certificates.

     

    In
      general, purchases of a security for the purpose of stabilization or to reduce
      a
      short position could cause the price of the security to be higher than it might
      be in the absence of such purchases.

     

    Neither
      the Depositor nor any of the Underwriters makes any representation or prediction
      as to the direction or magnitude of any effect that the transactions described
      above may have on the prices of the Offered Certificates. In addition, neither
      the Depositor nor any of the Underwriters makes any representation that the
      Underwriters will engage in such transactions or that such transactions, once
      commenced, will not be discontinued without notice.

     

    The
      Offered Certificates are offered subject to receipt and acceptance by the
      Underwriters, to prior sale and to each Underwriter’s right to reject any order
      in whole or in part and to withdraw, cancel or modify the offer without notice.
      It
      is
      expected that delivery of the Offered Certificates will be made through the
      facilities of DTC, Clearstream and the Euroclear System on or about the Closing
      Date.
      The Offered Certificates will be offered in Europe and the United States of
      America.

     

    The
      Underwriting Agreement provides that the Depositor and the Seller will indemnify
      each Underwriter against certain civil liabilities, including liabilities under
      the Securities Act of 1933, as amended, or will contribute to payments an
      Underwriter may be required to make in respect thereof.exv10w20

 

Exhibit 10.20

NET LEASE AGREEMENT

(Multi-Tenant)

by and between

TRIDENT MICROSYSTEMS, INC., a Delaware corporation

(“Tenant”)

and

COOPERAGE ROSE PROPERTIES, a general partnership

(“Landlord”)

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	1. Summary of Lease Provisions
	 	 	1	 
	2. Property Leased
	 	 	2	 
	2.1 Premises
	 	 	3	 
	2.2 Improvements
	 	 	3	 
	2.3 Condition of Premises
	 	 	5	 
	3. Term
	 	 	6	 
	3.1 Commencement Date
	 	 	6	 
	3.2 Delay of Commencement Date
	 	 	7	 
	3.3 Early Access
	 	 	7	 
	3.4 Tenant to Physically Occupy Premises
	 	 	7	 
	3.5 Tenant Option to Renew
	 	 	8	 
	4. Rent
	 	 	10	 
	4.1 Rent
	 	 	10	 
	4.2 Late Charges
	 	 	10	 
	4.3 Additional Rent
	 	 	11	 
	5. Security Deposit
	 	 	11	 
	6. Use of Premises
	 	 	12	 
	6.1 Permitted Uses
	 	 	12	 
	6.2 Tenant to Comply with Legal Requirements
	 	 	12	 
	6.3 Prohibited Uses
	 	 	13	 
	6.4 Hazardous Materials
	 	 	14	 
	7. Taxes
	 	 	16	 
	7.1 Personal Property Taxes
	 	 	16	 

 

 

	 	 	 	 	 
	 	 	Page	 
	7.2 Other Taxes Payable Separately by Tenant
	 	 	16	 
	7.3 Common Taxes
	 	 	17	 
	(a) Definition of Taxes
	 	 	17	 
	(b) Common Area Charge
	 	 	18	 
	8. Insurance; Indemnity; Waiver
	 	 	18	 
	8.1 Insurance by Landlord
	 	 	18	 
	(a) Property Insurance
	 	 	18	 
	(b) Liability Insurance
	 	 	18	 
	(c) Other
	 	 	18	 
	8.2 Insurance by Tenant
	 	 	18	 
	(a) Personal Property Insurance
	 	 	19	 
	(b) Liability Insurance
	 	 	19	 
	(c) Other
	 	 	19	 
	(d) Form of the Policies
	 	 	19	 
	8.3 Failure by Tenant to Obtain Insurance
	 	 	20	 
	8.4 Indemnification
	 	 	20	 
	8.5 Claims by Tenant
	 	 	20	 
	8.6 Mutual Waiver of Subrogation
	 	 	21	 
	9. Utilities
	 	 	21	 
	10. Repairs and Maintenance
	 	 	21	 
	10.1 Landlord’s Responsibilities
	 	 	22	 
	10.2 Tenant’s Responsibilities
	 	 	22	 
	11. Common Area
	 	 	22	 
	11.1 In General
	 	 	23	 
	11.2 Parking Areas
	 	 	23	 

 

	 	 	 	 	 
	 	 	Page	 
	11.3 Maintenance by Landlord
	 	 	24	 
	12. Common Area Charges
	 	 	24	 
	12.1 Definition
	 	 	24	 
	12.2 Payment of Common Area Charges by Tenant
	 	 	25	 
	12.3 Exclusions From Common Area Charges
	 	 	26	 
	(a) Losses Caused by Others and Construction Defects
	 	 	26	 
	(b) Condemnation and Insurance Costs
	 	 	26	 
	(c) Reimbursable Expenses
	 	 	26	 
	(d) Utilities or Services
	 	 	26	 
	(e) Leasing Expenses
	 	 	26	 
	(f) Reserves
	 	 	26	 
	(g) Mortgages
	 	 	27	 
	(h) Hazardous Materials
	 	 	27	 
	(i) Management
	 	 	27	 
	(j) Capital Improvements Required by Law
	 	 	27	 
	13. Alterations and Improvements
	 	 	27	 
	13.1 In General
	 	 	27	 
	13.2 Removal Upon Lease Termination
	 	 	28	 
	13.3 Landlord’s Improvements
	 	 	29	 
	14. Default and Remedies
	 	 	29	 
	14.1 Events of Default
	 	 	29	 
	14.2 Remedies
	 	 	30	 
	14.2.1 Termination
	 	 	30	 
	14.2.2 Continuance of Lease
	 	 	31	 
	15. Damage or Destruction
	 	 	31	 

 

 

	 	 	 	 	 
	 	 	Page	 
	15.1 Definition of Terms
	 	 	31	 
	15.2 Insured Casualty
	 	 	31	 
	15.2.1 Rebuilding Required
	 	 	31	 
	15.2.2 Landlord’s Election
	 	 	31	 
	15.2.3 Continuance of Lease
	 	 	31	 
	15.3 Uninsured Casualty
	 	 	32	 
	15.4 Tenant’s Election
	 	 	32	 
	15.5 Damage or Destruction Near End of Lease Term
	 	 	33	 
	15.6 Termination of Lease
	 	 	33	 
	15.7 Abatement of Rentals
	 	 	33	 
	15.8 Liability for Personal Property
	 	 	33	 
	16. Condemnation
	 	 	33	 
	16.1 Definition of Terms
	 	 	34	 
	16.2 Rights
	 	 	34	 
	16.3 Total Taking
	 	 	34	 
	16.4 Partial Taking
	 	 	34	 
	17. Liens
	 	 	35	 
	17.1 Premises to Be Free of Liens
	 	 	35	 
	17.2 Notice of Lien; Bond
	 	 	35	 
	18. Landlord’s Right of Access to Premises
	 	 	35	 
	19. Landlord’s Right to Perform Tenant’s Covenants
	 	 	36	 
	20. Lender Requirements
	 	 	36	 
	20.1 Subordination
	 	 	36	 
	20.2 Subordination Agreements
	 	 	37	 
	20.4 Attornment
	 	 	37	 

 

 

	 	 	 	 	 
	 	 	Page	 
	20.5 Estoppel Certificates and Financial Statements
	 	 	37	 
	(a) Delivery by Tenant
	 	 	37	 
	(b) Nondelivery by Tenant
	 	 	38	 
	21. Holding Over
	 	 	38	 
	22. Notices
	 	 	38	 
	23. Attorneys’ Fees
	 	 	38	 
	24. Assignment, Subletting and Hypothecation
	 	 	39	 
	24.1 In General
	 	 	39	 
	24.2 Voluntary Assignment and Subletting
	 	 	39	 
	(a) Notice to Landlord
	 	 	39	 
	(b) Offer to Terminate
	 	 	39	 
	(c) Landlord’s Consent
	 	 	40	 
	(d) Assumption of Obligations
	 	 	40	 
	24.3 Collection of Rent
	 	 	41	 
	24.4 Corporations and Partnerships
	 	 	41	 
	24.5 Reasonable Provisions
	 	 	42	 
	24.6 Attorneys’ Fees
	 	 	42	 
	24.7 Involuntary Transfer
	 	 	42	 
	24.8 Hypothecation
	 	 	43	 
	24.9 Binding on Successors
	 	 	43	 
	25. Successors
	 	 	43	 
	26. Landlord Default; Mortgagee Protection
	 	 	43	 
	27. Exhibits
	 	 	43	 
	28. Surrender of Lease Not Merger
	 	 	43	 
	29. Waiver
	 	 	43	 

 

 

	 	 	 	 	 
	 	 	Page	 
	30. General
	 	 	44	 
	30.1 Captions and Headings
	 	 	44	 
	30.2 Definitions
	 	 	44	 
	(a) Landlord
	 	 	44	 
	(b) Agents
	 	 	44	 
	(c) Interpretation of Terms
	 	 	44	 
	30.3 Copies
	 	 	45	 
	30.4 Time of Essence
	 	 	45	 
	30.5 Severability
	 	 	45	 
	30.6 Governing Law
	 	 	45	 
	30.7 Joint and Several Liability
	 	 	45	 
	30.8 Construction of Lease Provisions
	 	 	45	 
	30.9 Tenant’s Financial Statements
	 	 	45	 
	30.10 Withholding of Landlord’s Consent
	 	 	45	 
	31. Signs
	 	 	45	 
	33. Landlord Not a Trustee
	 	 	46	 
	34. Interest
	 	 	46	 
	35. Surrender of Premises
	 	 	46	 
	36. Labor Disputes
	 	 	47	 
	37. No Partnership or Joint Venture
	 	 	47	 
	38. Entire Agreement
	 	 	47	 
	39. Submission of Lease
	 	 	47	 
	40. Quiet Enjoyment
	 	 	48	 
	41. Authority
	 	 	48	 

 

 

NET LEASE AGREEMENT

(Multi-Tenant)

For and in consideration of the rentals, covenants, and conditions hereinafter set forth, Landlord
hereby leases to Tenant, and Tenant hereby rents from Landlord, the following described Premises
for the term, at the rental and subject to and upon all of the terms, covenants and agreements set
forth in this Net Lease Agreement, including Landlord’s right to recover the Premises pursuant to
Paragraph 24 below (“Lease”):

     1. Summary of Lease Provisions.

	 	1.1	 	Tenant: TRIDENT MICROSYSTEMS, INC., a Delaware corporation
(“Tenant”).
	 
	 	1.2	 	Landlord: COOPERAGE ROSE PROPERTIES, a general partnership
(“Landlord”).
	 
	 	1.3	 	Date of Lease, for reference purposes only: April 11, 2006.
	 
	 	1.4	 	Premises: That certain building (“Building”) consisting of
approximately 30,500 square feet and shown cross-hatched on the site plan
attached hereto as Exhibit B and commonly referred to as 3408-3410
Garrett Drive and located in the City of Santa Clara (“City”), County of Santa
Clara, California. (Paragraph 2.1)
	 
	 	1.5	 	Term: Five (5) years, subject to the provisions of Paragraph 3
below. (Paragraph 3)
	 
	 	1.6	 	Commencement Date: August 1, 2006, subject to the provisions
of Paragraph 3 below. (Paragraph 3)
	 
	 	1.7	 	Ending Date: July 31, 2011, unless extended pursuant to the
terms of this Lease. (Paragraph 3)
	 
	 	1.8	 	Rent:

	 	 	 
	TIME PERIOD	 	MONTHLY INSTALLMENT
	Year 1
	 	$26,535.00*
	Year 2
	 	$27,331.05
	Year 3
	 	$28,150.98
	Year 4
	 	$28,995.51
	Year 5
	 	$29,865.38

 

			
	*	 	Receipt of the second month’s Rent is hereby acknowledged by Landlord. No Rent shall be payable
for the first month of the Term. (Paragraph 4)

1

 

	 	1.9	 	Use of Premises: General office, research and development,
marketing, storage and/or product testing and for uses related to the
foregoing. (Paragraph 6)
	 
	 	1.10	 	Tenant’s percentage share of Common Area Charges: Forty-five
and 18/100 percent (45.18%)
	 
	 	1.11	 	Security Deposit: Twenty-nine Thousand Eight Hundred
Sixty-five Dollars and Thirty-eight cents ($29,865.38) (Paragraph 5)
	 
	 	1.12	 	Addresses for Notices:

	 	 	 
	To Landlord:

	 	3375 Scott Blvd., Suite 308
	 

	 	Santa Clara, CA 95054
	 

	 	Attn: Terrence J. Rose
	 
	 	 
	To Tenant:

	 	Prior to the Commencement Date,
	 

	 	Trident Microsystems, Inc.
	 

	 	1090 East Arques Ave.
	 

	 	Sunnyvale, CA 94085
	 

	 	Attn: Peter Jen, Chief Administrative Officer
	 
	 	 
	 

	 	From and after the Commencement Date, to the Premises,
	 

	 	Attn: Peter Jen, Chief Administrative Officer

	 	1.13	 	Parking:

(a) Nonexclusive right to use no more than one hundred six (106)
parking spaces within the Common Area, which shall include required handicap
parking for the Building.

(b) Exclusive right to use no more than four (4) parking spaces within the
Common Area for Tenant’s visitors (the “Visitor Parking Spaces”).

(c) Exclusive right to use no more than twelve (12) parking spaces within
the Common Area for Tenant’s designated employees (the “Designated Employee
Parking Spaces”). (Paragraph 11.2)

	 	1.14	 	Summary Provisions in General. Parenthetical
references in this Paragraph 1 to other paragraphs in this Lease are for
convenience of reference, and designate some of the other Lease paragraphs
where applicable provisions are set forth. All of the terms and conditions of
each such referenced paragraph shall be construed to be incorporated within and
made a part of each of the above referring Summary of Lease Provisions. In the
event of any conflict between any Summary of Lease Provision as set forth above
and the balance of the Lease, the latter shall control.

     2. Property Leased.

2

 

          2.1 Premises. Landlord hereby leases to Tenant and Tenant hereby leases from Landlord
upon the terms and conditions herein set forth, those certain premises (“Premises”) referred to in
Paragraph 1.4 consisting of the Building which is part of a two building complex (the “Project”).
In addition, Tenant shall have such rights in and to the Common Area (defined in Paragraph 11.1
below) as are more fully described in Paragraph 11.1 below.

     The building comprising the Premises is referred to herein as the “Building.” The “Land”
shall mean and refer to all of the real property outlined in red on Exhibit A. The other
building of the Project is sometimes referred to herein as the “Other Building”. Any reference in
this Lease to the “Parcel” shall be deemed a reference to the Land. The Land, Building and any
other building(s) or improvement(s) now or hereafter located on the Land are referred to herein
collectively as the “Project.”

     Landlord reserves the right to grant to tenants of the Project, and to the agents, employees,
servants, invitees, contractors, guests, customers and representatives of such tenants or to any
other user authorized by Landlord, the nonexclusive right to use the Land for pedestrian and
vehicular ingress and egress and vehicular parking (excluding only that portion of the Land
designated herein for Tenant’s exclusive use for vehicular parking, if any).

          2.2 Improvements.

               2.2.1 Interior Improvements. Tenant has engaged AP+I, architects (“AP+I”) to prepare
interior plans for the Premises. Attached hereto as Exhibit D are the preliminary space
plans for the Premises (“Preliminary Plans”), which Preliminary Plans are approved by Landlord and
Tenant for the interior improvements to be constructed by Landlord for Tenant’s use in the
Premises. Within ten (10) days of the Effective Date, AP+1 will prepare and deliver to Landlord
completed pricing plans (“Pricing Plans”) in material conformance with the Preliminary Plans.
Within ten (10) business days of Landlord’s receipt of the Pricing Plans, Landlord shall submit to
Tenant a cost estimate (the “Interior Estimate”) for the work described in the Pricing Plans. The
Interior Estimate shall set forth an estimated guarantied maximum price (the “GMP”) for the work
described in Tenant’s Interior Plans, and the general contractor’s reasonable fees related thereto.
The Interior Estimate for the mechanical, electrical, and plumbing work will be based on three
competitive bids. Tenant shall have five (5) days from receipt of the Interior Estimate to either
(i) approve the Interior Estimate or (ii) in Tenant’s reasonable discretion, disapprove the
Interior Estimate and provide Landlord a detailed explanation for its disapproval. In the event
Tenant disapproves the Interior Estimate and provided Tenant’s disapproval is reasonable, Landlord
shall revise and resubmit the Interior Estimate to Tenant within five (5) days following Landlord’s
receipt of Tenant’s original disapproval and, provided that the revised Interior Estimate
materially reflects Tenant’s comments described in the foregoing sentence, the revised Interior
Estimate shall be deemed approved, subject to the provisions of the succeeding paragraph, and upon
delivery to Tenant and shall be referred to herein as the “Construction Budget”.

3

 

     Within ten (10) business days following finalization of the Construction Budget as described
in the foregoing Paragraph, Tenant shall cause AP+I to prepare and deliver to Landlord construction
drawings depicting the work that is described in the Pricing Plans and that is set forth in the
Construction Budget (the “Interior Construction Drawings”). Within three (3) business days of
receipt of the Interior Construction Drawings, Landlord will ascertain and notify Tenant whether
the Interior Estimate and the Construction Budget are unchanged or not. If in the reasonable
discretion of Landlord and the Contractor, the Interior Estimate and the Construction Budget
require revision, Landlord, Tenant and Contractor will immediately meet and confer and agree to
reasonable changes in the same so that the final Construction Budget may be forthwith approved by
the parties. The improvements described in the Interior Construction Drawings are referred to
herein as the “Interior Work”.

               2.2.2 Completion of the Interior Work. Landlord, at Landlord’s sole cost and expense,
will make and enter into a construction contract (the “Contract”) with Permian Builders (the
“Contractor”) to complete the Interior Work in accordance with the GMP and the Interior
Construction Drawings, provided the cost of the Interior Work to be borne by Landlord, including
the design, permits and furniture, shall not exceed $610,000 (the “Allowance”). From the
Allowance, Landlord shall also reimburse Tenant, within fifteen (15) days of Tenant’s written
demand therefor, and the delivery of paid invoices for the actual costs incurred by Tenant with
respect to (i) the services of AP+I described in the foregoing Paragraph 2.2.1 and (ii) any
construction consultant hired by Tenant. Landlord represents that Contractor is neither an
affiliate of or an entity controlled by Landlord. The Contract shall expressly provide that Tenant
shall have no liability to Contractor for the Interior Work and that Contractor shall indemnify
Tenant to the same extent Landlord is indemnified under the Contract. Any costs for the Interior
Work in excess of the Allowance shall be paid by Tenant to Landlord provided that Tenant shall have
no obligation to pay any amounts in excess of the GMP except as otherwise expressly provided in
this Section 2.2.2. Tenant may in its reasonable discretion, make changes in or additions to the
Interior Work, provided that such changes and additions shall comply with Landlord’s building
standards and any costs in excess of the Allowance and in excess of the GMP incurred as a result of
said changes and/or additions shall be paid by Tenant as provided below. Landlord may elect by
written notice to Tenant within ninety (90) days prior to the Ending Date, to retain the furniture
installed pursuant to the Allowance upon termination of the Lease. In the event Landlord does not
so elect, such furniture shall be deemed the property of Tenant and shall be removed by Tenant at
the expiration or earlier termination of the Lease Term.

     In the event of changes to any of the Interior Work by reason of any error or omission in the
Interior Construction Drawings, or because requested in writing by Tenant and accepted in writing
by Landlord, Tenant shall pay to Landlord Landlord’s actual costs that are in excess of the
Allowance and in excess of the GMP related to such changes before work in regard to such changes is
commenced; provided, however, in no event shall Landlord’s failure to demand such payment before
commencement of work in regard to such changes, or Tenant’s failure to pay for the same before
commencement of work in regard to such changes be deemed to be a waiver of Landlord’s right to
require or enforce collection of such payment for changes at any time thereafter. Landlord’s costs
related to the changes shall include, without limitation, all

4

 

architectural, contractor, and engineering expenses, and the cost of all building and other permits and inspection fees. In the event of any changes, Landlord’s costs shall be deemed to include
architect, engineering and/or contractor expenses at the rates charged to third parties by Landlord
and/or such related person or entity for such services, unless otherwise expressly provided in this
Lease.

          2.2.3 Exterior Improvements In addition to the Interior Work, Landlord will, at
Landlord’s sole cost separate and apart from the Allowance, engage the services of architects, to
prepare exterior construction drawings (the “Exterior Construction Drawings”), which Exterior
Construction Drawings shall materially conform to the preliminary plans approved by Landlord and
Tenant and attached hereto as Exhibit E. The Exterior Construction Drawings shall be delivered to
Tenant within twenty (20) days following the Date of Lease described in Section 1.3 above. Tenant
shall have five (5) days from receipt of the Exterior Construction Drawings to either (i) approve
the Exterior Construction Drawings or (ii) in Tenant’s reasonable discretion, disapprove the
Exterior Construction Drawings, only if they are inconsistent with the completed pricing plans
attached hereto as Exhibit “D”, and provide Landlord a detailed explanation for its disapproval.
In the event Tenant disapproves the Exterior Construction Drawings and provided Tenant’s
disapproval is reasonable, Landlord shall revise and resubmit the Exterior Construction Drawings to
Tenant within five (5) days following Landlord’s receipt of Tenant’s original disapproval and,
provided that revised Exterior Construction Drawings materially reflect Tenant’s comments described
in the foregoing sentence, the revised Exterior Construction Drawings shall be deemed approved upon
delivery to Tenant and shall be referred to herein as the “Final Exterior Construction Drawings”.
The improvements described in the Final Exterior Construction Drawings are referred to herein as
the “Exterior Work”. The Exterior Work will require not only the approval of the City Building
Department, but also the approval of the City Planning Department. Landlord shall cause the
Exterior Work to be completed as soon as possible but in no event later than October 1, 2006.

          2.3 Condition of Premises. Landlord warrants to Tenant that on the Commencement Date
and except for improvements constructed by Tenant, (i) all building systems, including roof
(including the roof structure and membrane), plumbing, HVAC, fire sprinklers, electrical (including
panels and outlets), interior lighting, ceiling tiles, and window coverings and all exterior
sprinklers and lighting, the parking area and landscaping shall be in good operating condition and
good repair, and (ii) the Building and Common Area shall be in compliance with all Laws (as defined
below), including seismic requirements, ADA and Title 24. Any defects in the warranted matters
which are reported by Tenant to Landlord within ninety (90) days after the Commencement Date shall
be repaired by Landlord at Landlord’s cost and expense. Landlord covenants that at its sole cost
and expense (and not as a Common Area charge) it will complete, prior to the Commencement Date:
(a) the HVAC repairs identified in the report of CalAir dated April 4, 2006, and (b) the roof
repairs identified in the report of Roof Leak Services dated March 13, 2006 (jointly, the
“Reports”). Copies of the Reports have been delivered to Tenant. Landlord further covenants that
at its sole cost and expense it will replace, (i) prior to the Commencement Date the Trane air
conditioning units on the roof of the Building identified in the CalAir report as Unit 7 (1979-3
ton) and Unit 2 (1979-5 ton), and (ii) as necessary during the Lease Term, the five (5) other Trane
air conditioning units now installed on

5

 

the roof of the Building. Provided, however, prior to the replacement of said Units 7 and 2, if Contractor recommends that units larger than currently existing units are required for Tenant’s server room, Tenant may elect to cause said larger units
to be installed in lieu of the two smaller units being replaced, in which case Tenant shall pay the
excess cost thereof directly or such cost shall be charged against the Allowance.

     Notwithstanding anything to the contrary contained in this Lease, Tenant’s acceptance of the
Premises shall not be deemed a waiver of Tenant’s right to have latent defects in the improvements
corrected by Landlord or the Premises repaired at no cost to Tenant. Tenant shall give notice to
Landlord whenever any such latent defect becomes reasonably apparent, and Landlord shall repair the
defect as soon as practicable.

     Any capital repairs or replacements required for the roof during the six month period
following the Commencement Date shall be at the sole cost and expense of Landlord and not a Common
Area charge.

     3. Term.

          3.1 Commencement Date. The term of this Lease (“Lease Term”) shall be for the period
specified in Paragraph 1.5 above, commencing on the date set forth in Paragraph 1.6 (“Commencement
Date”); provided, however, the Commencement Date shall be delayed until such time as the Interior
Work is Substantially Completed (as defined below) and at least three (3) weeks have elapsed in the
Early Access Period (as defined below).

               (a) The Interior Work shall be deemed to be “Substantially Completed” upon the occurrence of
the earliest of the following:

                    (i) The date on which all improvements to be constructed by Landlord have been substantially
completed except for punch list items which do not prevent Tenant from using the Premises for its
intended use, and the appropriate governmental approvals for occupancy of the Premises have been
issued; or

                    (ii) the date on which all improvements to be constructed by Landlord would have been
substantially completed except for such work as Landlord is required to perform but which is
delayed because of any of the following (each, a “Tenant Delay”): (A) delays in Tenant’s architect
completing the Preliminary Interior Improvement Plans or the Final Interior Improvement Plans; (B)
fault or neglect of Tenant, acts of Tenant or Tenant’s agents (including without limitation delays
caused by work done on the Premises by Tenant or Tenant’s agents or by acts of Tenant’s contractors
or subcontractors); (C) delays caused by change orders requested by Tenant or required because of
any errors or omissions in plans submitted by Tenant; and (D) such work as Landlord is required to
perform but cannot complete until Tenant performs necessary portions of construction work it has
elected or is required to do; provided, however, Tenant Delays shall not include any delays caused
by Landlord or Landlord’s architect or contractor in performing work relating to the Exterior Work;
or

6

 

                    (iii) the date Tenant opens for business in the Premises.

     If the Commencement Date is a date other than the date set forth in Paragraph 1.6, then the
Ending Date set forth in Paragraph 1.7, the rental adjustment dates set forth in Paragraph 1.8 and
any other certain dates specified herein shall be adjusted accordingly. When the Commencement
Date, Ending Date, rental adjustment dates, and such other dates become ascertainable, Landlord and
Tenant shall specify the same in writing, in the form of the attached Exhibit C, which
writing shall be deemed incorporated herein. Tenant’s failure to execute and deliver the letter
attached hereto as Exhibit C within thirty (30) days after Tenant receives written request
from Landlord to do so (subject to any legitimate disagreement by Tenant with the terms thereof,
which both parties shall use reasonable efforts to resolve) shall be a Default by Tenant hereunder.
The expiration of the Lease Term or sooner termination of this Lease is referred to herein as the
“Lease Termination.”

          3.2 Delay of Commencement Date. Landlord shall not be liable for any damage or loss
incurred by Tenant for Landlord’s failure for whatever cause to deliver possession of the Premises
by a particular date (including the Commencement Date), nor shall this Lease be void or voidable on
account of such failure to deliver possession of the Premises; provided that if the Commencement
Date does not occur on or before September 1, 2006, Tenant shall have the right to terminate this
Lease by written notice delivered to Landlord within ten (10) days thereafter, and Landlord and
Tenant shall be relieved of their respective obligations hereunder; provided further that the
September 1, 2006 deadline shall be extended by the number of days work on the Premises is delayed
due to fault or neglect of Tenant, acts of Tenant or Tenant’s agents, or due to acts of God, labor
disputes, strikes, fires, rainy or stormy weather, acts or failures to act of public agencies,
inability to obtain labor or materials, earthquake, war, insurrection, riots and other causes
beyond Landlord’s reasonable control, excluding, however, delays caused solely by Landlord, its
agents, employees, contractors or invitees.

          3.3 Early Access. As soon as possible (based upon the status of the Interior Work),
Tenant and its employees, contractors and agents shall have access to the Premises for purposes of
installing Tenant’s personal property, data and telephone lines, furniture and trade fixtures in
the Premises. The date upon which Landlord first provides Tenant access to the Premises for the
purposes described in the foregoing sentence shall be referred to herein as the “Early Access
Date”. Tenant shall occupy the Premises from the Early Access Date until the Commencement Date
(the “Early Access Period”) on all of the terms of this Lease except that (i) Tenant shall have no
obligation to pay Rent during the Early Access Period and (ii) shall have no liability regarding
the Interior Work or the Exterior Work except to the extent caused by Tenant. Landlord and Tenant
shall cooperate during the Early Access Period to prevent any unreasonable interference with the
other’s contractors.

          3.4 Tenant to Physically Occupy Premises. Tenant shall, no later than thirty (30)
days after the Commencement Date, go into actual physical occupancy of the Premises and open the
Premises for business in accordance with the uses specified in Paragraph 6 below; provided,
however, the date of Tenant’s physical occupancy of the Premises shall in no event

7

 

extend the Commencement Date, the Lease Termination date or the date the payment of Rentals hereunder
commences. Time is of the essence.

          3.5 Tenant Option to Renew.

               (a) Renewal Option. Subject to the terms and conditions set forth below, Tenant may
at its option (“Renewal Option”) extend the Term of this Lease for one (1) additional five (5) year
period (the “Renewal Term “). If Tenant exercises the Renewal Option hereunder, all of the terms,
covenants and conditions of this Lease shall continue in full force and effect during the Renewal
Term, including provisions regarding payment of Additional Rent, which shall remain payable on the
terms herein set forth, except that (i) the Rent payable by Tenant during the Renewal Term shall be
as determined in accordance with Sections (c) and (d) below, (ii) Tenant shall continue to possess
and occupy the Premises in their existing condition, “as is” as of the commencement of the Renewal
Term, and Landlord shall have no obligation to repair, remodel, improve or alter the Premises, to
perform any other construction or other work of improvement upon the Premises, or to provide Tenant
with any construction or refurbishing allowance whatsoever, and (iii) Tenant shall have no further
rights to extend the Term of this Lease after the expiration of the Renewal Term.

               (b) Conditions of Exercise. To exercise the Renewal Option, Tenant must deliver
written notice to Landlord (which notice shall be subject to Section 3.5(d)(i)(3) below) via
certified mail or hand delivery not sooner than three hundred sixty-five (365) days nor later than
one hundred eighty (180) days prior to the expiration of the initial Term of this Lease. If Tenant
fails to timely give its notice of exercise, Tenant will be deemed to have waived its Renewal
Option.

               (c) Market Rate Calculation. The Rent payable by Tenant for the Premises during the
Renewal Term shall be the Market Rate (as defined below) for the Premises, valued as of the
commencement of the Renewal Term, determined in the manner hereinafter provided; however, that in
no event shall the annual Rent payable by Tenant for any year of the Renewal Term be less than the
annual Rent payable during the last year of the initial Term (without regard to any abatements of
Rent on account of casualty or otherwise) (“Rent Floor”). As used herein, the term “Market Rate”
shall mean the annual amount of Rent that a willing tenant would pay, and that a willing landlord
would accept, at arm’s length, for space comparable to the Premises within the Project or other
comparable projects in the vicinity of the Project (the “Comparison Projects”), based upon binding
lease transactions for tenants in the Comparison Projects that, where possible, commence or are to
commence within six (6) months prior to or within six (6) months after the commencement of the
Renewal Term (“Comparison Leases”). Comparison Leases shall include renewal and new non-renewal
tenancies, but shall exclude subleases and leases of space subject to another tenant’s expansion
rights. Rental rates payable under Comparison Leases shall be adjusted to account for variations
between this Lease and the Comparison Leases with respect to: (i) the length of the Renewal Term
compared to the lease term of the Comparison Leases; (ii) rental structure, including, without
limitation, rental rates per rentable square foot (including type, gross or net, and if gross,
adjusting for base year or expense stop), additional rent, escalation provisions, all other
payments and escalations; (iii) the size of

8

 

the Premises compared to the size of the premises of the Comparison Leases; (iv) location, floor levels and efficiencies of the floor(s) for which the
determination is being made; (v) free rent, moving expenses and other cash payments, allowances or
other monetary concessions affecting the rental rate; (vi) the age and quality of construction of the Building (including
compliance with applicable codes on the applicable floors); and (vii) leasehold improvements and/or
allowances, including the amounts thereof in renewal leases, and taking into account, in the case
of renewal leases (including this Lease), the value of existing leasehold improvements to the
renewal tenant.

               (d) Rent Determination. The Rent payable by Tenant for the Premises during the
Renewal Term shall be determined as follows:

                    (i) If Tenant provides Landlord with its written notice of exercise pursuant to Section (b)
above, then, within thirty (30) days of receipt of such notice, Landlord shall deliver to Tenant
either (i) a good faith written proposal of the Market Rate, or (ii) notice that Landlord has
determined in good faith that the Market Rate is less than Rent Floor and, therefore, the Rent for
the Renewal Term shall be equal to the Rent Floor. Within twenty-one (21) days after receipt of
Landlord’s proposal, Tenant shall notify Landlord in writing (1) that Tenant accepts Landlord’s
proposal, (2) that Tenant elects to submit the determination of Market Rate to arbitrate in
accordance with Subsections (iii) and (iv) below, or (3) that Tenant rejects Landlord’s proposal
and, upon such rejection, Tenant’s exercise of its Renewal Option shall be deemed null and void and
shall be of no force or effect whatsoever and the Term of this Lease shall expire on the Ending
Date set forth in Section 1.7 above. If Tenant does not give Landlord a timely notice in response
to Landlord’s proposal, Landlord’s proposal of Market Rate shall be binding upon Tenant.

                    (ii) If Tenant timely elects to submit the determination of Market Rate to arbitration,
Landlord and Tenant shall first negotiate in good faith in an attempt to determine the Market Rate.
If Landlord and Tenant are able to agree within thirty (30) days following the delivery of
Tenant’s notice to Landlord electing arbitration (or if Tenant accepts Landlord’s initial
proposal), then such agreement shall constitute a determination of Market Rate for purposes of this
Section, and the parties shall immediately execute an amendment to this Lease stating the Rent for
the Renewal Term. If Landlord and Tenant are unable to agree on the Market Rate within such
negotiating period, then within fifteen (15) days after the expiration of such negotiating period,
the parties shall meet and concurrently deliver to each other in envelopes their respective good
faith estimates of the Market Rate (set forth on a net effective rentable square foot per annum
basis). If the higher of such estimates is not more than one hundred five percent (105%) of the
lower, then the Market Rate shall be the average of the two. Otherwise, the dispute shall be
resolved by arbitration in accordance with Subsections (iii) and (iv) below.

                    (iii) Within seven (7) days after the exchange of estimates, the parties shall select as an
arbitrator an independent real estate broker with at least five (5) years of experience in leasing
commercial space in the metropolitan area in which the Project is located (a “Qualified
Appraiser”). If the parties cannot agree on a Qualified Appraiser, then within a second period of
seven (7) days, each shall select a Qualified Appraiser and within ten (10) days

9

 

thereafter the two appointed Qualified Appraisers shall select an independent Qualified Appraiser and the independent
Qualified Appraiser shall be the sole arbitrator. If one party shall fail to select a Qualified Appraiser within the second seven (7) day period, then the
Qualified Appraiser chosen by the other party shall be the sole arbitrator.

                    (iv) Within twenty-one (21) days after submission of the matter to the arbitrator, the
arbitrator shall determine the Market Rate by choosing whichever of the estimates submitted by
Landlord and Tenant the arbitrator judges to be more accurate in the context of the parameters set
forth in Section 3.5(c) above. The arbitrator shall notify Landlord and Tenant of its decision,
which shall be final and binding. If the arbitrator believes that expert advice would materially
assist him, the arbitrator may retain one or more qualified persons to provide expert advice. The
fees of the arbitrator and the expenses of the arbitration proceeding, including the fees of any
expert witnesses retained by the arbitrator, shall be paid by the party whose estimate is not
selected. Each party shall pay the fees of its respective counsel and the fees of any witness
called by that party.

                    (v) Until the matter is resolved by agreement between the parties or a decision is rendered in
any arbitration commenced pursuant to this Section 3.5, Tenant’s monthly payments of Rent shall be
in an amount equal to the greater of (i) the Rent Floor or (ii) Landlord’s determination of the
Market Rate. Within ten (10) business days following the resolution of such dispute by the parties
or the decision of the arbitrator, as applicable, Tenant shall pay to Landlord, or Landlord shall
pay to Tenant, the amount of any deficiency or excess, as the case may be, in the Rent theretofore
paid.

     4. Rent.

          4.1 Rent. Tenant shall pay to Landlord as rent for the Premises (“Rent”), in advance,
on the first day of each calendar month, commencing on the date 30 days after the Commencement Date
and continuing throughout the Lease Term the Rent set forth in Paragraph 1.8 above. Rent shall be
prorated, based on thirty (30) days per month, for any partial month during the Lease Term. Rent
shall be payable without deduction, offset, prior notice or demand in lawful money of the United
States to Landlord at the address herein specified for purposes of notice or to such other persons
or such other places as Landlord may designate in writing. Rent shall be abated for the first
month of the Lease Term. Landlord acknowledges it has received from Tenant the sum of Twenty Six
Thousand Five Hundred Thirty Five Dollars ($26,535) which sum shall be applicable to the Rent
payable for the second month of the Lease Term.

          4.2 Late Charges. Tenant hereby acknowledges that late payment by Tenant to Landlord
of Rent will cause Landlord to incur costs not contemplated by this Lease, the exact amount of
which will be extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be imposed on Landlord by the terms
of any mortgage or deed of trust covering the Premises. Accordingly, Tenant shall pay to Landlord,
as Additional Rent (as defined in Paragraph 4.3 below), without the necessity of

10

 

prior notice or demand, a late charge equal to five percent (5%) of any installment of Rent which is not received
by Landlord within five (5) days after the due date for such installment. The parties hereby agree
that such late charge represents a fair and reasonable estimate of the costs Landlord will incur by reason of late payment by Tenant. In no
event shall this provision for a late charge be deemed to grant to Tenant a grace period or
extension of time within which to pay any installment of Rent or prevent Landlord from exercising
any right or remedy available to Landlord upon Tenant’s failure to pay such installment of Rent
when due, including without limitation the right to terminate this Lease. In the event any
installment of Rent is not received by Landlord by the thirtieth (30th) day after the due date for
such installment, such installment shall bear interest at the annual rate set forth in Paragraph 34
below, commencing on the thirty-first (31st) day after the due date for such installment and
continuing until such installment is paid in full. Landlord and Tenant acknowledge and agree that
the terms of this Section 4.2 shall not be applicable unless, in the twelve (12) months preceding
any late payment of Rent, Tenant failed to timely deliver any installment of Rent, provided,
however, that the terms of this Section 4.2 shall apply upon the occurrence of any Default by
Tenant described in Section 14.1(a).

          4.3 Additional Rent. All taxes, charges, costs and expenses and other sums which
Tenant is required to pay hereunder (together with all interest and charges that may accrue thereon
in the event of Tenant’s failure to pay the same), and all damages, costs and reasonable expenses
which Landlord may incur by reason of any Default by Tenant shall be deemed to be additional rent
hereunder (“Additional Rent”). Additional Rent shall accrue commencing on the Commencement Date.
In the event of nonpayment by Tenant of any Additional Rent, Landlord shall have all the rights and
remedies with respect thereto as Landlord has for the nonpayment of Rent. The term “Rentals” as
used in this Lease shall mean Rent and Additional Rent.

     5. Security Deposit. Concurrently with Tenant’s execution of this Lease, Tenant shall
deposit with Landlord a security deposit (“Security Deposit”) in the amount set forth in Paragraph
1.11 above. The Security Deposit shall be held by Landlord as security for the faithful
performance by Tenant of each and every term, covenant and condition of this Lease applicable to
Tenant, and not as prepayment of Rent. If Tenant shall at any time fail to keep or perform any
term, covenant or condition of this Lease applicable to Tenant, including without limitation, the
payment of Rentals or those provisions requiring Tenant to repair damage to the Premises caused by
Tenant or to surrender the Premises in the condition required pursuant to Paragraph 35 below,
Landlord may, but shall not be obligated to, and without waiving or releasing Tenant from any
obligation under this Lease, use, apply or retain the whole or any part of the Security Deposit
reasonably necessary for the payment of any amount which Landlord actually spends by reason of
Tenant’s default or as necessary to compensate Landlord for any loss or damage which Landlord may
suffer by reason of Tenant’s default. In the event Landlord uses or applies any portion of the
Security Deposit, Tenant shall, within thirty (30) days after written demand by Landlord, remit to
Landlord sufficient funds to restore the Security Deposit to its original sum. Failure by Tenant
to so remit funds shall be a Default by Tenant (subject to any legitimate disagreement by Tenant
pertaining to the Landlord’s use of the Security Deposit, which both parties shall use reasonable
efforts to resolve). Should Tenant comply with all of the terms, covenants and conditions of this
Lease applicable to Tenant, the balance of the Security Deposit shall be returned to Tenant within
fourteen (14) days after Lease Termination and surrender of the Premises by Tenant; provided,

11

 

however, if any portion of the Security Deposit is to be applied to repair damages to the Premises
caused by Tenant or Tenant’s agents, to clean the Premises, or to remove alterations and restore the Premises
pursuant to Paragraph 13.2 below, then the balance of the Security Deposit shall be returned to
Tenant no later than thirty (30) days after the date Landlord receives possession of the Premises.

     6. Use of Premises.

          6.1 Permitted Uses. Tenant shall use the Premises and the Common Area only in
conformance with applicable governmental or quasi-governmental laws, statutes, orders, regulations,
rules, ordinances and other requirements now or hereafter in effect (collectively, “Laws”) for the
purposes set forth in Paragraph 1.9 above, and for no other purpose without the prior written
consent of Landlord, which consent shall not be unreasonably withheld or delayed, provided that
such other use is in conformance with applicable Laws. Tenant acknowledges and agrees that
Landlord has selected or will be selecting tenants for the Building in order to produce a mix of
tenant uses compatible and consistent with the design integrity of the Building and with other uses
of the Building; provided, however, the selection of Building tenants shall be in Landlord’s
reasonable discretion and Landlord in making such selection shall not be deemed to be warranting
that any use of the Building made by any such tenant is compatible or consistent with the design
integrity of the Building or other uses of the Building. Any change in use of the Premises or the
Common Area without the prior written consent of Landlord shall be a Default by Tenant. Tenant and
Tenant’s agents shall comply with the provisions of any Declaration of Covenants, Conditions, and
Restrictions affecting the Premises and the Common Area.

          6.2 Tenant to Comply with Legal Requirements. Subject to the obligations,
representations and warranties of Landlord set forth in Section 2.3 above, Tenant shall, at its
sole cost, promptly comply with all Laws relating to or affecting Tenant’s particular use or
occupancy of the Premises or use of the Common Area, now in force, or which may hereafter be in
force, including without limitation those relating to utility usage and load or number of
permissible occupants or users of the Premises, whether or not the same are now contemplated by the
parties; with the provisions of all recorded documents affecting the Premises or the Common Area
insofar as the same relate to or affect Tenant’s particular use or occupancy of the Premises or use
of the Common Area; and with the requirements of any board of fire underwriters (or similar body
now or hereafter constituted) relating to or affecting Tenant’s particular or occupancy of the
Premises or use of the Common Area. Tenant’s obligations pursuant to this Paragraph 6.2 shall
include, without limitation, maintaining or restoring the Premises and making structural and
non-structural alterations and additions in compliance and conformity with all Laws and recorded
documents (including, without limitation, alterations or additions to the Premises, Building or
Common Area that are required pursuant to the ADA), each relating to Tenant’s particular use or
occupancy of the Premises during the Lease Term or alterations made to the Premises by Tenant. Any
alterations or additions undertaken by Tenant pursuant to this Paragraph 6.2 shall be subject to
the requirements of Paragraph 13.1 below. At Landlord’s option, Landlord may make the required
alteration, addition or change, and Tenant shall pay as Additional Rent the reasonable actual cost
thereof. If the total cost is in excess of $25,000, any mechanical, electrical and plumbing work
will be based on competitive bids. The foregoing notwithstanding, Landlord

12

 

shall make any alteration or addition required to bring the Premises, the Building or the Common
Area into compliance with legal requirements in effect at the time the Premises, the Interior Work
and the Exterior Work installed therein by Landlord, the Building or the Common Area, respectively,
were originally constructed. The cost of any alterations as may be hereafter required due to a
change in laws and unrelated to Tenant’s specific use of the Premises shall be the responsibility
of Landlord.

     Tenant shall obtain prior to taking possession of the Premises any permits, licenses or other
authorizations required for the lawful operation of its business at the Premises. The judgment of
any court of competent jurisdiction or the admission of Tenant in any action or proceeding against
Tenant, regardless of whether Landlord is a party thereto or not, that Tenant has violated such Law
or recorded document relating to Tenant’s particular use or occupancy of the Premises or use of the
Common Area shall be conclusive of the fact of such violation by Tenant.

          6.3 Prohibited Uses. Tenant and Tenant’s agents shall not commit or suffer to be
committed any waste upon the Premises. Tenant and Tenant’s agents shall not do or permit anything
to be done in or about the Premises or Common Area which will in any way unreasonably obstruct or
unreasonably interfere with the rights of any other tenants of the Building, other authorized users
of the Common Area, or occupants of neighboring property, or injure or annoy them. Tenant shall
not conduct or permit any auction or sale open to the public to be held or conducted on or about
the Premises or Common Area. Tenant and Tenant’s agents shall not use or allow the Premises to be
used for any unlawful or hazardous purpose or any purpose not permitted by this Lease, nor shall
Tenant or Tenant’s agents cause, maintain, or permit any nuisance in, on or about the Premises.
Tenant and Tenant’s agents shall not do or permit anything to be done in or about the Premises nor
bring or keep anything in the Premises which will in any way increase the rate of any insurance
upon any portion of the Project or any of its contents, or cause a cancellation of any insurance
policy covering any portion of the Project or any of its contents, nor shall Tenant or Tenant’s
agents keep, use or sell or permit to be kept, used or sold in or about the Premises any articles
which may be prohibited by a standard form policy of fire insurance. In the event the rate of any
insurance upon any portion of the Project or any of its contents is increased because of Tenant’s
particular use of the Premises or that of Tenant’s agents, Tenant shall pay, as Additional Rent,
the full cost of such increase; provided, however this provision shall in no event be deemed to
constitute a waiver of Landlord’s right to declare a default hereunder by reason of the act or
conduct of Tenant or Tenant’s agents causing such increase or of any other rights or remedies of
Landlord in connection therewith. Tenant and Tenant’s agents shall not place any loads upon the
floor, walls or ceiling of the Premises which would endanger the Building or the structural
elements thereof or of the Premises, nor place any harmful liquids in the drainage system of the
Building or Common Area. No waste materials or refuse shall be dumped upon or permitted to remain
upon any part of the Project except in enclosed trash containers designated for that purpose by
Landlord. No materials, supplies, equipment, finished products (or semi-finished products), raw
materials, or other articles of any nature shall be stored upon, or be permitted to remain on, any
portion of the Project outside the Premises.

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          6.4 Hazardous Materials. Neither Tenant nor Tenant’s agents shall permit the
introduction, placement, use, storage, manufacture, transportation, release or disposition
(collectively “Release”) of any Hazardous Material(s) (defined below) on or about any portion of
the Project without the prior written consent of Landlord, which consent may be withheld in the
sole and absolute discretion of Landlord without any requirement of reasonableness in the exercise
of that discretion. Notwithstanding the immediately preceding sentence to the contrary, Tenant may
use (a) de minimis quantities of the types of materials which are technically classified as
Hazardous Materials but commonly used in domestic or office use to the extent not in an amount,
which, either individually or cumulatively, would be a “reportable quantity” under any applicable
Law, and (b) reasonable quantities of Hazardous Material(s) identified in Exhibit F consistent with
the research and development use of the Premises described in Paragraph 1.9. Tenant covenants
that, at its sole cost and expense, Tenant will comply with all applicable Laws with respect to the
Release by Tenant, its agents, employees, contractors or invitees of such permitted Hazardous
Materials. Any Release beyond the scope allowed in this paragraph shall be subject to Landlord’s
prior consent, which may be withheld in Landlord’s sole and absolute discretion, and shall require
an amendment to the Lease in the event Landlord does consent which shall set forth the materials,
scope of use, indemnification and any other matter required by Landlord in Landlord’s sole and
absolute discretion. Tenant shall indemnify, defend and hold Landlord and Landlord’s agents
harmless from and against any and all claims, losses, damages, liabilities, or expenses arising in
connection with the Release of Hazardous Materials in violation of Hazardous Materials Laws by
Tenant, Tenant’s agents or any other person using the Premises with Tenant’s knowledge and consent
or authorization. Tenant’s obligation to defend, hold harmless and indemnify pursuant to this
Paragraph 6.4 shall survive Lease Termination.

     Notwithstanding anything in this Paragraph 6.4 or elsewhere in this Lease to the contrary,
Landlord shall release Tenant from and indemnify, hold harmless, and defend Tenant against any and
all third party (i.e., claimants other than Tenant or Tenant’s affiliates) claims, liabilities,
causes of action, costs and expenses arising in connection with the presence of Hazardous Materials
on, under, or about the Premises, Building or Common Area to the extent existing as of the
Commencement Date or caused by any third parties or by Landlord or Landlord’s employees, agents,
contractors or invitees (collectively, “Hazmat Claims”). Landlord’s indemnification, defense and
hold harmless obligations under this Lease shall include and apply to reasonable attorneys’ fees,
investigation costs, and other costs actually incurred by Tenant. Hazmat Claims shall not include
any claim by Tenant or Tenant’s affiliates for its other losses whether direct or consequential.
The release and covenant to indemnify, hold harmless, and defend provided for in this paragraph
shall survive any termination or expiration of this Lease.

     Notwithstanding anything to the contrary contained in this Lease, Landlord hereby represents
and warrants to Tenant that, to the best of Landlord’s knowledge, (i) the Premises, the Building,
and Project are in compliance with all laws regarding Hazardous Materials (“Hazardous Materials
Laws”); (ii) no asbestos-containing materials exist in or on the Premises, the Building, or
Project; and (iii) any handling, transportation, storage or use of Hazardous Materials that
occurred in the Premises, the Building, or Project prior to the Commencement Date is now in
compliance with all Hazardous Materials Laws. Landlord further represents and warrants that, to
the best of Landlord’s knowledge, no litigation has been brought or threatened,

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nor any settlements reached with any governmental or private party, concerning the actual or
alleged presence of Hazardous Materials on or about the Premises, Building, or Project, nor has
Landlord received any notice of any violation, or alleged violation, of any Hazardous Materials
laws, pending claims or pending investigations with respect to the presence of Hazardous Materials
on or about the Premises, Building, or Project. Landlord’s representations and warranties set
forth in this paragraph shall survive termination of this Lease.

     As used in this Lease, the term “Hazardous Materials” means any chemical, substance, waste or
material which has been or is hereafter determined by any federal, state or local governmental
authority to be capable of posing risk of injury to health or safety, including without limitation,
those substances included within the definitions of “hazardous substances,” “hazardous materials,”
“toxic substances,” or “solid waste” under the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, the Resource Conservation and Recovery Act of 1976, and the Hazardous
Materials Transportation Act, as amended, and in the regulations promulgated pursuant to said laws;
those substances defined as “hazardous wastes” in section 25117 of the California Health & Safety
Code, or as “hazardous substances” in section 25316 of the California Health & Safety Code, as
amended, and in the regulations promulgated pursuant to said laws; those substances listed in the
United States Department of Transportation Table (49 CFR 172.101 and amendments thereto) or
designated by the Environmental Protection Agency (or any successor agency) as hazardous substances
(see, e.g., 40 CFR Part 302 and amendments thereto); such other substances,
materials and wastes which are or become regulated or become classified as hazardous or toxic under
any Laws, including without limitation the California Health & Safety Code, Division 20, and Title
26 of the California Code of Regulations; and any material, waste or substance which is (i)
petroleum, (ii) asbestos, (iii) polychlorinated biphenyls, (iv) designated as a “hazardous
substance” pursuant to section 311 of the Clean Water Act of 1977, 33 U.S.C. sections 1251
et seq. (33 U.S.C. § 1321) or listed pursuant to section 307 of the Clean Water Act
of 1977 (33 U.S.C. § 1317), as amended; (v) flammable explosives; (vi) radioactive materials; or
(vii) radon gas.

     Landlord shall have the right, upon reasonable advance notice to Tenant (but no less than two
(2) business days prior notice, except in the event of an emergency), to inspect, investigate,
sample and/or monitor the Premises, the Building and Common Area, including any soil, water,
groundwater, or other sampling, to the extent reasonably necessary to determine whether Tenant is
complying with the terms of this Lease with respect to Hazardous Materials. Unless a previous
inspection has disclosed a violation by Tenant of the covenants contained in this Paragraph 6.4,
such inspections, investigations, sampling and/or monitoring shall be performed not more often than
twice per year. In connection therewith, Tenant shall provide Landlord with reasonable access to
all portions of the Premises; provided, however, that Landlord shall (i) provide Tenant no less
than two (2) business days prior notice, except in the event of an emergency, and (ii) avoid any
unreasonable interference with the operation of Tenant’s business on the Premises. In the event
that Tenant is not in compliance with the terms of this Lease with regard to Hazardous Materials,
all costs incurred by Landlord in performing such inspections, investigation, sampling and/or
monitoring shall be reimbursed by Tenant to Landlord as Additional Rent within thirty (30) days
after Landlord’s demand for payment.

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     7. Taxes.

          7.1 Personal Property Taxes. Tenant shall use reasonable efforts to cause Tenant’s
trade fixtures, equipment, furnishings, furniture, merchandise, inventory, machinery, appliances
and other personal property installed or located on the Premises (collectively the “personal
property”) to be assessed and billed separately from the Land and the Building. Tenant shall pay
before delinquency any and all taxes, assessments and public charges levied, assessed or imposed
upon or against Tenant’s personal property. If any of Tenant’s personal property shall be assessed
with the Land or the Building, Tenant shall pay to Landlord, as Additional Rent, the amounts
attributable to Tenant’s personal property within thirty (30) days after receipt of a written
statement from Landlord setting forth the amount of such taxes, assessments and public charges
attributable to Tenant’s personal property. Tenant shall comply with the provisions of any Law
which requires Tenant to file a report of Tenant’s personal property located on the Premises.

          7.2 Other Taxes Payable Separately by Tenant. Tenant shall pay (or reimburse
Landlord, as Additional Rent, if Landlord is assessed), prior to delinquency or within thirty (30)
days after receipt of Landlord’s statement thereof, any and all taxes, levies, assessments or
surcharges payable by Landlord or Tenant and relating to this Lease or the Premises (other than
Landlord’s net income, succession, transfer, gift, franchise, estate or inheritance taxes, and
Taxes, as that term is defined in Paragraph 7.3(a) below, payable as a Common Area Charge), whether
or not now customary or within the contemplation of the parties hereto, whether or not now in force
or which may hereafter become effective, including but not limited to taxes:

               (a) Upon, allocable to, or measured by the area of the Premises or the Rentals payable
hereunder, including without limitation any gross rental receipts, excise, or other tax levied by
the state, any political subdivision thereof, city or federal government with respect to the
receipt of such Rentals;

               (b) Upon or with respect to the use, possession occupancy, leasing, operation and management
of the Premises or any portion thereof;

               (c) Upon this transaction or any document to which Tenant is a party creating or transferring
an interest or an estate in the Premises; or

               (d) Imposed as a means of controlling or abating environmental pollution or the use of energy
or any natural resource (including without limitation gas, electricity or water), including,
without limitation, any parking taxes, levies or charges or vehicular regulations imposed by any
governmental agency. Tenant shall also pay, prior to delinquency, all privilege, sales, excise,
use, business, occupation, or other taxes, assessments, license fees, or charges levied, assessed
or imposed upon Tenant’s business operations conducted at the Premises.

     In the event any such taxes are payable by Landlord and it shall not be lawful for Tenant to
reimburse Landlord for such taxes, then the Rentals payable hereunder shall be increased to

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net Landlord the same net Rental after imposition of any such tax upon Landlord as would have been
payable to Landlord prior to the imposition of any such tax.

          7.3 Common Taxes.

               (a) Definition of Taxes. The term “Taxes” as used in this Lease shall collectively
mean (to the extent any of the following are not paid by Tenant pursuant to Paragraphs 7.1 and 7.2
above) all real estate taxes and general and special assessments (including, but not limited to,
assessments for public improvements or benefit); personal property taxes; taxes based on vehicles
utilizing parking areas on the Land; taxes computed or based on rental income or on the square
footage of the Premises or the Building (including without limitation any municipal business tax
but excluding federal, state and municipal net income taxes); environmental surcharges; excise
taxes; gross rental receipts taxes; sales and/or use taxes; employee taxes; water and sewer taxes,
levies, assessments and other charges in the nature of taxes or assessments (including, but not
limited to, assessments for public improvements or benefit); and all other governmental,
quasi-governmental or special district impositions of any kind and nature whatsoever; regardless of
whether any of the foregoing are now customary or within the contemplation of the parties hereto
and regardless of whether resulting from increased rate and/or valuation, or whether extraordinary
or ordinary, general or special, unforeseen or foreseen, or similar or dissimilar to any of the
foregoing and which during the Lease Term are laid, levied, assessed or imposed upon Landlord
and/or become a lien upon or chargeable against any portion of the Project under or by virtue of
any present or future laws, statutes, ordinances, regulations, or other requirements of any
governmental, quasi-governmental or special district authority whatsoever. The term “environmental
surcharges” shall include any and all expenses, taxes, charges or penalties imposed by the Federal
Department of Energy, Federal Environmental Protection Agency, the Federal Clean Air Act, or any
regulations promulgated thereunder, or imposed by any other local, state or federal governmental
agency or entity now or hereafter vested with the power to impose taxes, assessments or other types
of surcharges as a means of controlling or abating environmental pollution or the use of energy or
any natural resource in regard to the use, operation or occupancy of the Project. The term “Taxes”
shall include (to the extent the same are not paid by Tenant pursuant to Paragraphs 7.1 and 7.2
above), without limitation, all taxes, assessments, levies, fees, impositions or charges levied,
imposed, assessed, measured, or based in any manner whatsoever upon or with respect to the use,
possession, occupancy, leasing, operation or management of the Project or in lieu of or equivalent
to any Taxes set forth in this Paragraph 7.3(a). In the event any such Taxes are payable by
Landlord and it shall not be lawful for Tenant to reimburse Landlord for such Taxes, then the
Rentals payable hereunder shall be increased to net Landlord the same net Rental after imposition
of any such Tax upon Landlord as would have been payable to Landlord prior to the imposition of any
such Tax.

Notwithstanding anything to the contrary contained in this Lease, neither the taxes payable by
Tenant pursuant to Section 7.2 above or the term “Taxes” shall include (a) any tax, levy,
assessment, charge or surcharge resulting from the contamination of real property by Hazardous
Materials (unless such contamination is caused by Tenant), (b) interest or penalties for the late
payment or failure to pay any real property taxes, (c) any tax or assessment in excess of the

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amount which would be payable if the tax or assessment were paid in installments over the
longest possible term, or (d) any tax or assessment imposed on land and improvements other than the
Project or imposed due to the use or occupancy of another tenant in the Project.

               (b) Common Area Charge. All Taxes which are levied or assessed or which become a lien
upon any portion of the Project or which become due or accrue during the Lease Term shall be a
Common Area Charge, and Tenant shall pay as Additional Rent each month during the Lease Term 1/12th
of its annual share of such Taxes, based on Landlord’s estimate thereof, pursuant to Paragraph 12
below. Tenant’s share of Taxes during any partial tax fiscal year(s) within the Lease Term shall
be prorated according to the ratio which the number of days during the Lease Term or of actual
occupancy of the Premises by Tenant, whichever is greater, during such year bears to 365.

     8. Insurance; Indemnity; Waiver.

          8.1 Insurance by Landlord. Landlord shall, during the Lease Term, procure and keep in
force the following insurance, the cost of which shall be a Common Area Charge, payable by Tenant
pursuant to Paragraph 12 below:

               (a) Property Insurance. “All risk” property insurance, including, without limitation,
boiler and machinery (if applicable); sprinkler damage; vandalism; malicious mischief; full
coverage plate glass insurance; and demolition, increased cost of construction and contingent
liability from change in building laws on the Building and the Land, including any improvements or
fixtures constructed or installed in the Building and on the Land by Landlord. Such insurance
shall be in the full amount of the replacement cost of the foregoing, with reasonable deductible
amounts, which deductible amounts shall be a Common Area Charge, payable by Tenant pursuant to
Paragraph 12. Such insurance shall also include rental income insurance, insuring that one hundred
percent (100%) of the Rentals (as the same may be adjusted hereunder) will be paid to Landlord for
a period of up to twelve (12) months if the Premises are destroyed or damaged, or such longer
period as may be required by any beneficiary of a deed of trust or any mortgagee of any mortgage
affecting the Premises. Such insurance shall not cover any leasehold improvements installed in the
Premises by Tenant at its expense, or Tenant’s equipment, trade fixtures, inventory, fixtures or
personal property located on or in the Premises;

               (b) Liability Insurance. Comprehensive general liability (lessor’s risk) insurance
against any and all claims for personal injury, death or property damage occurring in or about the
Building or the Land. Such insurance shall have a combined single limit of not less than Three
Million Dollars ($3,000,000) per occurrence and Five Million Dollars ($5,000,000) aggregate; and

               (c) Other. Such other insurance as Landlord deems necessary and prudent.

          8.2 Insurance by Tenant. Tenant shall, during the Lease Term, at Tenant’s sole cost
and expense, procure and keep in force the following insurance:

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               (a) Personal Property Insurance. “All risk” property insurance, including, without
limitation, coverage for vandalism; malicious mischief; and demolition, increased cost of
construction and contingent liability from changes in building laws on all leasehold improvements
installed in the Premises by Tenant at its expense but not including the Interior Work, and on all
equipment, trade fixtures, inventory, fixtures and personal property located on or in the Premises,
including improvements or fixtures hereinafter constructed or installed on the Premises by Tenant.
Such insurance shall be in an amount equal to the full replacement cost of the aggregate of the
foregoing and shall provide coverage comparable to the coverage in the standard ISO all risk form,
when such form is supplemented with the coverages required above.

               (b) Liability Insurance. Comprehensive general liability insurance for the mutual
benefit of Landlord and Tenant, against any and all claims for personal injury, death or property
damage occurring in or about the Premises and Common Area or arising out of Tenant’s or Tenant’s
agents’ use of the Common Area, use or occupancy of the Premises or Tenant’s operations on the
Premises. Such insurance shall have a combined single limit of not less than One Million Dollars
($1,000,000) per occurrence and Three Million Dollars ($3,000,000) aggregate. Such insurance shall
contain a cross-liability (severability of interests) clause and an extended (“broad form”)
liability endorsement, including blanket contractual coverage. The minimum limits specified above
are the minimum amounts required by Landlord, and may be revised by Landlord from time to time to
meet changed circumstances, including without limitation to reflect (i) changes in the purchasing
power of the dollar, (ii) changes indicated by the amount of plaintiffs’ verdicts in personal
injury actions in the State of California, or (iii) changes consistent with the standards required
by other landlords in the county in which the Premises are located. Such liability insurance shall
be primary and not contributing to any insurance available to Landlord, and Landlord’s insurance
(if any) shall be in excess thereto. Tenant’s obligations pursuant to Paragraph 8.4 shall not be
limited to the amount of any insurance required of or carried by Tenant under this Paragraph
8.2(b). Tenant shall be responsible for insuring that the amount of insurance maintained by Tenant
is sufficient for Tenant’s purposes.

               (c) Other. Such other insurance as required by law, including, without limitation,
workers’ compensation insurance.

               (d) Form of the Policies. The policies required to be maintained by Tenant pursuant
to Paragraphs 8.2(a), (b), and (c) above shall be with companies, on forms, with deductible amounts
(if any), and loss payable clauses reasonably satisfactory to Landlord, shall include Landlord and
the beneficiary or mortgagee of any deed of trust or mortgage encumbering the Premises and/or the
Land as additional insureds, and shall provide that such parties may, although additional insureds,
recover for any loss suffered by Tenant’s negligence. Tenant shall (i) deliver certified copies of
policies or certificates of insurance to Landlord prior to the Commencement Date; and (ii) use
commercially reasonable efforts to deliver a new policy or certificate to Landlord at least fifteen
(15) business days prior to the expiration date of the old policy. Tenant shall have the right to
provide insurance coverage which it is obligated to carry

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pursuant to the terms hereof in a blanket policy, provided such blanket policy expressly affords coverage to the Premises and Common Area and to Tenant as
required by this Lease. Tenant shall notify Landlord and any beneficiary or mortgagee of a deed of
trust or mortgage encumbering the Premises and/or the Land in writing of any lapse or termination
of any policy and at least thirty (30) days prior to any cancellation or modification of any
policy. Tenant’s policies shall provide coverage on an occurrence basis and not on a claims made
basis. In no event shall the limits of any policies maintained by Tenant be considered as limiting
the liability of Tenant under this Lease.

          8.3 Failure by Tenant to Obtain Insurance. If Tenant does not take out the insurance
required pursuant to Paragraph 8.2 or keep the same in full force and effect, Landlord may, but
shall not be obligated to, take out the necessary insurance and pay the premium therefor, and
Tenant shall repay to Landlord, as Additional Rent, the amount so paid promptly upon demand. In
addition, Landlord may recover from Tenant and Tenant agrees to pay, as Additional Rent, any and
all reasonable expenses (including reasonable attorneys’ fees) and damages which Landlord may
sustain by reason of the failure of Tenant to obtain and maintain such insurance, it being
expressly declared that the expenses and damages of Landlord shall not be limited to the amount of
the premiums thereon.

          8.4 Indemnification. Tenant shall indemnify, hold harmless, and defend Landlord with
competent counsel against all claims, losses, damages, expenses or liabilities for injury or death
to any person or for damage to or loss of use of any property arising out of any occurrence in, on
or about the Premises, Building, Common Area or Land, if caused or contributed to by the negligence
or willful misconduct of Tenant or Tenant’s agents, or arising out of any occurrence under the
control of Tenant in, upon or at the Premises except where such claim arises out of Landlord’s
negligence or willful misconduct, or that of its agents, employees, contractors or invitees.
Tenant’s indemnification, defense and hold harmless obligations under this Lease shall include and
apply to reasonable attorneys’ fees, investigation costs, and other costs actually incurred by
Landlord. The provisions of this Paragraph 8.4 shall survive Lease Termination with respect to any
damage, injury or death occurring prior to such termination. Except as set forth in this Paragraph
8.4, this Lease is made on the express condition that Landlord shall not be liable for, or suffer
loss by reason of, injury to person or property, from whatever cause, in any way connected with the
condition, use, occupational safety or occupancy of the Premises specifically including, without
limitation, any liability for injury to the person or property of Tenant or Tenant’s agents.

          8.5 Claims by Tenant. Except as expressly provided in Paragraph 8.4, Landlord shall
not be liable to Tenant, and Tenant waives all claims against Landlord, for injury or death to any
person, damage to any property, or loss of use of any property in any portion of the Project by and
from all causes, including without limitation, any defect in any portion of the Project and/or any
damage or injury resulting from fire, steam, electricity, gas, water or rain, which may leak or
flow from or into any part of the Premises, or from breakage, leakage, obstruction or other defects
of pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting fixtures, whether
the damage or injury results from conditions arising upon the Premises or upon other portions of
the Project or from other sources. Neither Landlord nor Tenant shall be

20

 

liable for any damages arising from any act or negligence of any other tenant or user of the Project. Tenant or Tenant’s
agents shall immediately notify Landlord in writing of any known defect in the Project. The provisions of this Paragraph 8.5 shall
not apply to any damage or injury caused by Landlord’s willful misconduct or negligence, or that of
its agents, employees, contractors or invitees.

          8.6 Mutual Waiver of Subrogation. Landlord hereby releases Tenant, and Tenant hereby
releases Landlord, and their respective officers, agents, employees and servants, from any and all
claims or demands of damages, loss, expense or injury to the Project, or to the furnishings,
fixtures, equipment, inventory or other property of either Landlord or Tenant in, about or upon the
Project, which is caused by or results from perils, events or happenings which are the subject of
insurance actually carried or required to be carried by the respective parties pursuant to this
Paragraph 8, whether due to the negligence of the other party or its agents and regardless of cause
or origin; provided, however, that such waiver shall be effective only to the extent permitted by
the insurance covering such loss, to the extent such insurance is not prejudiced thereby, and to
the extent insured against.

     9. Utilities. Tenant shall pay during the Lease Term all charges for water, gas,
light, heat, power, electricity, telephone or other communication service, janitorial service,
trash pick-up, sewer and all other services supplied to Tenant or consumed by Tenant on the
Premises (collectively the “Services”) and all taxes, levies, fees or surcharges therefor. Tenant
shall arrange for Services to be supplied to the Premises and shall contract for all of the
Services in Tenant’s name prior to the Commencement Date. The Commencement Date shall not be
delayed by reason of any failure by Tenant to so contract for Services. In the event that any of
the Services are not separately billed or metered to the Premises, or if any of the Services are
not separately metered as of the Commencement Date, the cost of such Services shall be a Common
Area Charge and Tenant shall pay, as Additional Rent, Tenant’s proportionate share of such cost to
Landlord as provided in Paragraph 12 below, except that if any meter services less than the entire
Building, Tenant’s proportionate share of the costs measured by such meter shall be based upon the
square footage of the gross leasable area in the Premises as a percentage of the total square
footage of the gross leasable area of the portion of the Building serviced by such meter. If
Landlord determines that Tenant is using a disproportionate amount of any commonly metered Services
or an amount in excess of the customary amount of any Services ordinarily furnished for use of the
Premises in accordance with the uses set forth in Paragraph 6 above, then Landlord may elect to
periodically charge Tenant, as Additional Rent, a sum equal to Landlord’s estimate of the cost of
Tenant’s excess use of any or all such Services. The lack or shortage of any Services due to any
cause whatsoever (except for a lack or shortage proximately caused by the negligent acts or willful
misconduct Landlord or that of its agents, employees, contractors or invitees) shall not affect any
obligation of Tenant hereunder, and Tenant shall faithfully keep and observe all the terms,
conditions and covenants of this Lease and pay all Rentals due hereunder, all without diminution,
credit or deduction, except where the lack or shortage of gas, light, heat, power or electricity
exceeds fifteen (15) consecutive business days.

     10. Repairs and Maintenance.

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          10.1 Landlord’s Responsibilities. Subject to the provisions of Paragraph 15 below,
Landlord shall maintain in reasonably good order and repair the structural roof, roof membrane,
structural and exterior walls (including painting thereof), foundations of the Building. In addition, Landlord shall maintain the service
contract (covering periodic inspection and servicing) for the heating and air conditioning systems
of the Premises. Tenant shall give prompt written notice to Landlord of any known maintenance work
required to be made by Landlord pursuant to this Paragraph 10.1. Notwithstanding the foregoing,
the costs of (i) repairs and maintenance of the roof membrane, (ii) periodic inspection and regular
servicing of the heating and air conditioning systems of the Premises, and (iii) painting the
exterior of the Premises which are the obligation of Landlord hereunder shall be a Common Area
Charge and Tenant shall pay, as Additional Rent, Tenant’s share of such costs to Landlord as
provided in Paragraph 12 below. Subject to Section 12.3(l) below, the costs of maintenance,
repair, and replacement of the structural parts of the Premises and the Building (including
foundations, floor slab, load bearing walls and roof structure) which are the obligation of
Landlord hereunder shall be at the cost and expense of Landlord and shall not be a Common Area
Charge, except for any repairs required because of the wrongful act of Tenant or Tenant’s agents,
which repairs shall be made at the expense of Tenant and as Additional Rent.

          10.2 Tenant’s Responsibilities. Except as expressly provided in Paragraph 10.1 above,
and subject to the provisions of Paragraph 2.3 above, Tenant shall, at its sole cost, maintain the
entire Premises and every part thereof, including without limitation, windows, skylights, window
frames, plate glass, freight docks, doors and related hardware, interior walls and partitions, and
the electrical, plumbing, lighting, heating and air conditioning systems in good order, condition
and repair. Tenant’s obligations with respect to the heating and air conditioning systems of the
Premises shall include the replacement of components thereof. If Tenant fails to make repairs or
perform maintenance work required of Tenant hereunder within thirty (30) days after written notice
from Landlord specifying the need for such repairs or maintenance work, Landlord or Landlord’s
agents may, in addition to all other rights and remedies available hereunder or by law and without
waiving any alternative remedies, enter into the Premises after providing Tenant at least two (2)
business day prior notice, except for an emergency and make such repairs and/or perform such
maintenance work. If Landlord makes such repairs and/or performs such maintenance work, Tenant
shall reimburse Landlord upon demand and as Additional Rent, for the reasonable cost of such
repairs and/or maintenance work. Landlord shall use reasonable efforts to avoid causing any
inconvenience to Tenant or interference with the use of the Premises by Tenant or Tenant’s agents
during the performance of any such repairs or maintenance. Landlord shall have no liability to
Tenant for any damage, inconvenience or interference with the use of the Premises by Tenant or
Tenant’s agents as a result of Landlord performing any such repairs or maintenance (except for the
negligent acts or willful misconduct Landlord or that of its agents, employees, contractors or
invitees). Tenant shall reimburse Landlord, as Additional Rent, for the cost of damage to the
Project caused by Tenant or Tenant’s agents within thirty (30) days of receipt of written notice.

     11. Common Area.

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          11.1 In General. Subject to the terms and conditions of this Lease and such rules and
regulations as Landlord may from time to time prescribe, Tenant and Tenant’s agents shall have, in
common with tenants of the other building of the Project and other permitted users, the nonexclusive right to use during the Lease Term the access roads,
parking areas, sidewalks, landscaped areas and other facilities on the Land designated by Landlord
for the general use and convenience of the occupants of the Building and other authorized users,
which areas and facilities are referred to herein as the “Common Area.” This right to use the
Common Area shall terminate upon Lease Termination. Landlord reserves the right to promulgate such
reasonable rules and regulations relating to the use of all or any portion of the Common Area and
to amend such rules and regulations from time to time with or without advance notice, as Landlord
may deem appropriate for the best interests of the occupants of the Building and other authorized
users. Any amendments to the rules and regulations shall be effective as to Tenant, and binding on
Tenant, upon delivery of a copy of such rules and regulations to Tenant. Tenant and Tenant’s
agents shall observe such rules and regulations and any failure by Tenant or Tenant’s agents to
observe and comply with the rules and regulations shall be a Default by Tenant. Landlord shall not
be responsible for the nonperformance of the rules and regulations by any tenants or occupants of
the Building or other authorized users, nor shall Landlord be liable to Tenant by reason of the
noncompliance with or violation of the rules and regulations by any other tenant or user.

          11.2 Parking Areas. At no cost to Tenant, Tenant is allocated and Tenant and Tenant’s
employees and invitees shall have the right to use not more than the number of parking spaces set
forth in Paragraph 1.13, the location of which may be designated from time to time by Landlord;
provided that the Visitor Parking Spaces and the Designated Employee Parking Spaces shall be in a
location reasonably acceptable to Tenant. Except for the Visitor Parking Spaces and the Designated
Employee Parking Spaces, Tenant’s use of the parking spaces shall be on a non-exclusive basis.
Neither Tenant nor Tenant’s agents shall at any time use more parking spaces than the number so
allocated to Tenant or park or permit the parking of their vehicles in any portion of the Land not
designated by Landlord as a parking area. Tenant and Tenant’s agents shall not have the exclusive
right to use any specific parking space except for the Visitor Parking Spaces and the Designated
Employee Parking Spaces as provided herein. Notwithstanding the number of parking spaces
designated for Tenant’s use, in the event by reason of any Law relating to or affecting parking on
the Land, or any other cause beyond Landlord’s reasonable control, Landlord is required to reduce
the number of parking spaces on the Land, Landlord shall have the right to proportionately reduce
the number of Tenant’s parking spaces and the nonexclusive parking spaces of other tenants in the
Building. Landlord reserves the right to promulgate such reasonable rules and regulations relating
to the use of such parking areas on the Land as Landlord may deem appropriate. Landlord
furthermore reserves the right, after having given Tenant prior written notice at least two (2)
business days in advance, to have any vehicles owned by Tenant or Tenant’s agents which are parked
in violation of the provisions of this Paragraph 11.2 or in violation of Landlord’s rules and
regulations relating to parking, to be towed away and Tenant shall pay the reasonable costs
thereof. In the event Landlord elects or is required by any law to limit or control parking on the
Land, by validation of parking tickets or any other method, Tenant agrees to participate in such
validation or other program under such reasonable rules and regulations as are from time to time
established by Landlord. Provided that Tenant’s use,

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occupancy and enjoyment of the Premises or access to the Premises is not unreasonably interfered with, Landlord shall have the right to close,
at reasonable times, all or any portion of the parking areas for any reasonable purpose, including
without limitation, the prevention of a dedication thereof, or the accrual of rights of any person or public therein. Tenant and Tenant’s agents shall not at
any time park or permit the parking of (i) trucks or other vehicles (whether owned by Tenant or
other persons) adjacent to any loading areas so as to interfere in any manner with the use of such
areas, (ii) Tenant’s or Tenant’s agents’ vehicles or trucks, or the vehicles or trucks of Tenant’s
suppliers or others, in any portion of the Common Area not designated by Landlord for such use by
Tenant, or (iii) any inoperative vehicles or equipment on any portion of the Common Area.

          11.3 Maintenance by Landlord. Landlord shall maintain the Common Area in good repair
and condition and shall manage the Common Area to reasonable and customary standards. The
expenditures for such maintenance shall be at the reasonable discretion of Landlord. The cost of
such maintenance, operation and management shall be a “Common Area Charge,” and Tenant shall pay to
Landlord, as Additional Rent, Tenant’s share of such costs as provided in Paragraph 12 below.

     12. Common Area Charges.

          12.1 Definition. “Common Area Charge” or “Common Area Charges” as used in this Lease
shall mean and include all items identified in other paragraphs of this Lease as a Common Area
Charge and the total cost paid or incurred by Landlord for the operation, maintenance, repair, and
management of the Project which costs shall include, without limitation: the cost of Services and
utilities supplied to the Project (to the extent the same are not separately charged or metered to
tenants of the Building); water; sewage; trash removal; fuel; electricity; heat; lighting systems;
fire protection systems; storm drainage and sanitary sewer systems; periodic inspection and regular
servicing of the heating and air conditioning systems of the Premises; maintaining, repairing and
replacing the roof membrane; property and liability insurance covering the Building and the Land
and any other insurance carried by Landlord pursuant to Paragraph 8 above; window cleaning;
cleaning, sweeping, striping, resurfacing of parking and driveway areas; cleaning the Common Area
following storms or other severe weather; cleaning and repairing of sidewalks, curbs, stairways;
costs related to irrigation systems and Project signs; fees for licenses and permits required for
the operation of the Project; the cost of complying with Laws, including, without limitation,
maintenance, alterations and repairs required in connection therewith (subject to the provisions of
Paragraph 12.3 hereof); costs related to landscape maintenance; and the cost of contesting the
validity or applicability of any governmental enactments which may affect Common Area Charges. If
the Project contains more than one (1) building at any time during the Lease Term, then the term
“Common Area Charges” shall mean and include all of the Common Area Charges allocable to the
Building and a proportionate share (based on the square footage of gross leasable area in the
Building as a percentage of the total of square footage of gross leasable area of the buildings in
the Project at the time in question) of all Common Area Charges which are related to the Project in
general and are not allocated to any one building in the Project. Common Area Charges shall also
include a management fee to Landlord in an amount equal to three percent (3%) of the annual Rent.

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Subject to the provisions of Section 2.3 hereof, the cost of (i) capital repair items (i.e., items
which Landlord is required to capitalize and not expense in the current year for federal income tax
purposes), (ii) replacement of the roof membrane, (iii) resurfacing the parking lot, and (iv)
repainting the exterior of the Building, shall be amortized at ten percent (10%) over the useful
life of the repair or item, and be paid monthly by Tenant from the date of installation or repair through Lease Termination, all in accordance with generally recognized real
estate industry practices. Specifically, capital repairs or replacements to the roof and/or the
HVAC shall be amortized over a fifteen (15) year period.

     The specific examples of Common Area Charges stated in this Paragraph 12.1 are in no way
intended to and shall not limit the costs comprising Common Area Charges, nor shall such examples
be deemed to obligate Landlord to incur such costs or to provide such services or to take such
actions except as Landlord may be expressly required in other portions of this Lease, or except as
Landlord, in its reasonable discretion, may elect. All reasonable costs incurred by Landlord in
good faith for the operation, maintenance, repair and management of the Project shall be deemed
conclusively binding on Tenant.

     Notwithstanding anything to the contrary contained in this Lease, within sixty (60) days after
receipt by Tenant of Landlord’s Statement (as defined below) of Common Area Charges prepared
pursuant to Paragraph 12.2 hereof for any prior annual period during the Lease Term, Tenant or its
authorized representative shall have the right to inspect the books of Landlord during the business
hours of Landlord at Landlord’s office or, at Landlord’s option, such other location as Landlord
reasonably may specify, for the purpose of verifying the information contained in the Statement.
Unless Tenant asserts specific errors within sixty (60) days after receipt of the statement, the
statement shall be deemed correct as between Landlord and Tenant, except as to individual
components subsequently determined to be in error by future audit. In addition, if the Statement
exceeds the actual Common Area Charges which should have been charged to Tenant by more than five
percent (5%), the cost of the audit shall be paid by Landlord.

          12.2 Payment of Common Area Charges by Tenant. Prior to the Commencement Date, and
annually thereafter, Landlord shall deliver to Tenant an estimate of Common Area Charges for the
succeeding year. Tenant’s payment of Common Area Charges shall be based upon Landlord’s estimate
of Common Area Charges and shall be payable in equal monthly installments in advance on the first
day of each calendar month commencing on the date specified in Paragraph 1.6 and continuing
throughout the Lease Term. Tenant shall pay to Landlord, as Additional Rent and without deduction
or offset, an amount equal to Tenant’s percentage share (stated in Paragraph 1.10 above) of the
Common Area Charges.

     Landlord shall revise its estimate of Common Area Charges on an annual basis, and Landlord may
adjust the amount of Tenant’s monthly installment in the event of a material change in Common Area
Charges during any year. Landlord shall furnish Tenant an annual statement (a “Statement”) (and a
Statement within one hundred eighty (180) days after Lease Termination) showing the actual Common
Area Charges for the period to which Landlord’s estimate pertains and shall concurrently either
bill Tenant for the balance due (payable upon demand by Landlord) or credit Tenant’s account for
the excess previously paid.

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     Alternatively, Common Area Charges actually incurred or paid by Landlord but not theretofore
billed to Tenant, as invoiced by Landlord shall be payable by Tenant within thirty (30) days after
receipt of Landlord’s invoice, but not more often than once each calendar month.

     Notwithstanding the foregoing provisions of this Paragraph 12, Landlord and Tenant agree that
if Landlord incurs any costs for insurance, Services, repairs or maintenance exclusively for or to
the Premises or for less than all the tenants of the Building and such costs are Common Area
Charges, or if any improvements installed in the Premises by Tenant or Landlord are valued by the
assessor disproportionately higher than those of any other tenants in the Building, then Tenant’s
share of such Common Area Charges shall be equitably increased by Landlord to reflect the portion
of any such costs or taxes incurred by Landlord in regard to the Premises, and Tenant shall pay the
same to Landlord as Additional Rent.

          12.3 Exclusions From Common Area Charges. Notwithstanding anything to the contrary
contained in this Lease, in no event shall Tenant have any obligation to perform, to pay directly,
or to reimburse Landlord for, all or any portion of the following repairs, maintenance,
improvements, replacements, premiums, claims, losses, fees, commissions, charges, disbursements,
attorneys’ fees, experts’ fees, costs and expenses (collectively, “Costs”).

               (a) Losses Caused by Others and Construction Defects. Costs occasioned by the act,
omission or violation of Law by Landlord, any other occupant of the Project, or their respective
agents, employees or contractors, or Costs to correct any construction defect in the Premises
(other than alterations constructed by Tenant), Building or Project, or costs arising out of the
failure to construct the Building, Premises, tenant improvements installed by Landlord pursuant to
Paragraph 2.2, or Common Areas in accordance with Laws and private restrictions applicable at the
time of construction thereof.

               (b) Condemnation and Insurance Costs. Costs occasioned by the exercise of the power
of eminent domain, or increases in insurance Costs caused by the activities of other occupant(s) of
the Project.

               (c) Reimbursable Expenses. Costs for which Landlord has a right of reimbursement from
others, or Costs which Tenant pays directly to a third person.

               (d) Utilities or Services. Costs (i) arising from the disproportionate use of any
utility or service supplied by Landlord to any other occupant of the Project; or (ii) associated
with utilities and services of a type not provided to Tenant.

               (e) Leasing Expenses. Costs incurred in connection with negotiations or disputes with
other occupant(s) of the Project, and Costs arising from the violation by Landlord or any occupant
of the Project (other than Tenant) of the terms and conditions of any lease or other agreement.

               (f) Reserves. Depreciation, amortization or other expense reserves.

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               (g) Mortgages. Interest, charges and fees incurred on debt, payments or mortgages and
rent under ground leases.

               (h) Hazardous Materials. Costs incurred to investigate the presence of any Hazardous
Material, Costs to respond to any claim of Hazardous Material contamination or damage, Costs to
remove any Hazardous Material from the Premises, Building or Project or to remediate any Hazardous
Material contamination, and any judgments or other Costs incurred in connection with any Hazardous
Material exposure or release, except to the extent such Costs are incurred by Landlord in
accordance with Paragraph 6.4 or incurred by Landlord or caused by reason of the storage, use or
disposal of the Hazardous Material in question by Tenant, its agents, employees, contractors or
invitees.

               (i) Management. Wages, salaries, compensation and labor burden for any employee not
stationed on the Project on a full-time basis, or any fee, profit or compensation retained by
Landlord or its affiliates for management and administration of the Project in excess of the
management fee specified in Paragraph 12.1.

               (j) Capital Improvements Required by Law. Costs for structural alterations required
by Law that do not relate solely to Tenant’s particular use or occupancy of the Premises, and Costs
of retrofitting any part of the Project, other than the Premises, in order to comply with the ADA
in connection with the leasing or alteration of portions of the Project other than the Premises.

               (k) Damage Caused by Landlord. The cost of damage and repairs necessitated by the
negligence or willful misconduct of Landlord or of Landlord ‘s agents, employees, contractors or
invitees.

               (l) Deductibles. Any deductible on Lessor’s insurance policy in excess of Five
Thousand Dollars ($5,000).

               (m) Earthquake Insurance. Any insurance premiums for earthquake insurance on the
Building or the Project.

     13. Alterations and Improvements.

          13.1 In General. Except as hereinafter provided, Tenant shall not make, or permit to
be made, any alterations, removals, changes, enlargements, improvements or additions (collectively
“Alterations”) in, on, about or to the Premises, or any part thereof, including Alterations
required pursuant to Paragraph 6.2, without the prior written consent of Landlord (which consent
shall not be unreasonably withheld or delayed) and without acquiring and complying with the
conditions of all permits required for such Alterations by any governmental authority having
jurisdiction thereof. Without the consent of Landlord but with notice to Landlord, Tenant may make
non-structural Alterations to the interior of the Building providing

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that the cost of any such event of Alteration does not exceed $10,000 and providing that Tenant complies with the other requirements of this provision. The term “Alterations” as used
in this Paragraph 13 shall also include all heating, lighting, electrical (including all wiring,
conduit outlets, drops, buss ducts, main and subpanels), air conditioning and partitioning in the
Premises made by Tenant regardless of how affixed to the Premises. As a condition to the giving of
its consent, Landlord may impose such reasonable requirements as Landlord reasonably may deem
necessary, including without limitation, the manner in which the work is done; a right of approval
of the contractor by whom the work is to be performed; the times during which the work is to be
accomplished; the requirement that Tenant post a completion bond in an amount and form reasonably
satisfactory to Landlord; and the requirement that Tenant reimburse Landlord, as Additional Rent,
for Landlord’s actual costs for outside consultants incurred in reviewing any proposed
Alteration(provided such costs shall not exceed a total amount of One Thousand Five Hundred Dollars
($1,500)), whether or not Landlord’s consent is granted. In the event Landlord consents to the
making of any Alterations by Tenant, the same shall be made by Tenant at Tenant’s sole cost and
expense, in accordance with the plans and specifications approved by Landlord and in a manner
causing Landlord and Landlord’s agents and other tenants of the Project the least interference and
inconvenience practicable under the circumstances. Tenant shall give written notice to Landlord
five days prior to employing any laborer or contractor to perform services related to, or receiving
materials for use upon the Premises, and prior to the commencement of any work of improvement on
the Premises. Any Alterations to the Premises made by Tenant shall be made in accordance with
applicable Laws and in a first-class workmanlike manner. In making any such Alterations, Tenant
shall, at Tenant’s sole cost and expense, file for and secure and comply with any and all permits
or approvals required by any governmental departments or authorities having jurisdiction thereof
and any utility company having an interest therein. In no event shall Tenant make any structural
changes to the Premises or make any changes to the Premises which would weaken or impair the
structural integrity of the Building.

          13.2 Removal Upon Lease Termination. At the time of Landlord’s consent, as required
by Section 13.1 above, Landlord shall notify Tenant in writing whether or not Tenant shall be
obligated to remove all or any portion of the Alterations that are the subject of such consent and
repair any damage occasioned by such removal prior to the expiration or earlier termination of the
Lease Term. In the event Landlord fails to provide the notification described in the foregoing
sentence on the date Landlord delivers its consent to Tenant, Landlord shall be deemed to have
elected that Tenant be obligated to remove the Alterations that are the subject of such consent.
If Landlord elects or is deemed to have elected to require Tenant to remove such Alterations,
Tenant shall, at its sole cost and expense, remove at Lease Termination such Alterations designated
by Landlord for removal and repair all damage to the Project arising from such removal. In the
event Tenant fails to remove any such Alterations designated by Landlord for removal, Landlord may
remove any Alterations made to the Premises by Tenant, restore the Premises to their prior
condition and repair all damage to the Premises and Common Area arising from such removal, and may
recover from Tenant all reasonable costs and expenses actually incurred thereby, together with an
amount equal to the fair rental value of the Premises for the period of time required for Landlord
to accomplish such removal and restoration. Tenant’s obligation to pay such costs and expenses to
Landlord shall survive Lease Termination.

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Unless Landlord elects to have Tenant remove or if Landlord fails to timely elect that Tenant remove any such Alterations, all such Alterations, except for moveable furniture, personal property and equipment, and trade fixtures of
Tenant not affixed to the Premises, shall become the property of Landlord upon Lease Termination
(without any payment therefor) and remain upon and be surrendered with the Premises at Lease
Termination.

          13.3 Landlord’s Improvements. All fixtures, improvements or equipment which are
installed, constructed on or attached to the Premises, Building or Common Area by Landlord,
including the Interior Work and the Exterior Work, shall be a part of the realty and belong to
Landlord.

     14. Default and Remedies.

          14.1 Events of Default. The term “Default by Tenant” as used in this Lease shall mean
the occurrence of any of the following events:

               (a) Tenant’s failure to pay when due any Rentals if such failure is not cured within five (5)
business days after written notice from Landlord to Tenant that such sums are due;

               (b) Commencement and continuation for at least sixty (60) days of any case, action or
proceeding by, against or concerning Tenant under any federal or state bankruptcy, insolvency or
other debtor’s relief law, including without limitation, (i) a case under Title 11 of the United
States Code concerning Tenant, whether under Chapter 7, 11, or 13 of such Title or under any other
Chapter, or (ii) a case, action or proceeding seeking Tenant’s financial reorganization or an
arrangement with any of Tenant’s creditors;

               (c) Voluntary or involuntary appointment of a receiver, trustee, keeper or other person who
takes possession for more than sixty (60) days of substantially all of Tenant’s assets or of any
asset used in Tenant’s business on the Premises, regardless of whether such appointment is as a
result of insolvency or any other cause;

               (d) Execution of an assignment for the benefit of creditors of substantially all assets of
Tenant available by law for the satisfaction of judgment creditors;

               (e) Commencement of proceedings for winding up or dissolving (whether voluntary or
involuntary) the entity of Tenant, if Tenant is a corporation or a partnership;

               (f) Levy of a writ of attachment or execution on Tenant’s interest under this Lease, if such
writ continues for a period of thirty (30) days;

               (g) Transfer or attempted Transfer of this Lease or the Premises by Tenant contrary to the
provisions of Paragraph 24 below; or

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               (h) Breach by Tenant of any term, covenant, condition, warranty, or other provision contained
in this Lease or of any other obligation owing or due to Landlord.

Notwithstanding the foregoing, in no event shall a Default by Tenant be deemed to have occurred
with respect the breaches referred to in subparagraphs 14.1(b) though 14.1(h) above except as
follows: (i) with respect to the breaches referred to in subparagraphs 14.1(d), (e), (g) and (h),
such breach is not cured within thirty (30) days after delivery of written notice by Landlord to
Tenant specifying such breach (or if a default under subparagraph 14.1(h) cannot be reasonably
cured within thirty (30) days, if Tenant does not commence to cure the default within the thirty
(30) day period or does not diligently and in good faith prosecute the cure to completion), or,
(ii) with respect to the defaults specified in subparagraphs 14.1(b), (c) and (f) such default is
not cured within the respective time periods specified in those subparagraphs.

          14.2 Remedies. Upon any Default by Tenant, Landlord shall have the following
remedies, in addition to all other rights and remedies provided by law, to which Landlord may
resort cumulatively, or in the alternative:

               14.2.1 Termination. Upon any Default by Tenant, Landlord shall have the right (but
not the obligation) to terminate this Lease and Tenant’s right to possession of the Premises. The
parties agree that any written notice given by Landlord to Tenant pursuant to Paragraph 14.1 above
shall be sufficient notice for purposes of California Code of Civil Procedure Section 1161 and
Landlord shall not be required to give any additional notice in order to be entitled to commence an
unlawful detainer proceeding. Upon termination of this Lease and Tenant’s right to possession of
the Premises, Landlord shall have the right to recover from Tenant:

               (a) The unpaid Rentals which had been earned at the time of termination;

(b) The Rentals which would have been earned after termination for the balance of the Lease Term,
except for any amount that exceed the amount of such rental loss that Tenant proves could have been
reasonably avoided;

               (c) The following amounts:

                    (i) Expenses in retaking possession of the Premises;

                    (ii) Expenses for cleaning, repairing or restoring the Premises;

                    (iii) Any unamortized real estate brokerage commission paid in connection with this Lease;

                    (iv) Reasonable expenses for removing, transporting, and storing any of Tenant’s property left
at the Premises (although Landlord shall have no obligation to remove, transport, or store any such
property);

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                    (v) Reasonable expenses of reletting the Premises, including without limitation, reasonable
brokerage commissions and reasonable attorneys’ fees;

                    (vi) Reasonable attorneys’ fees and court costs; and

                    (vii) Reasonable costs of carrying the Premises such as repairs, maintenance, taxes and
insurance premiums, utilities and security precautions (if any).

               14.2.2 Continuance of Lease. Upon any Default by Tenant and unless and until Landlord
elects to terminate this Lease pursuant to Paragraph 14.2.1 above, this Lease shall continue in
effect after the Default by Tenant and Landlord may enforce all its rights and remedies under this
Lease, including without limitation, the right to recover payment of Rentals as they become due.
Neither efforts by Landlord to mitigate damages caused by a Default by Tenant nor the acceptance of
any Rentals shall constitute a waiver by Landlord of any of Landlord’s rights or remedies,
including the rights and remedies specified in Paragraph 14.2.1 above.

     15. Damage or Destruction.

          15.1 Definition of Terms. For the purposes of this Lease, the term: (a) ”Insured
Casualty” means damage to or destruction of the Premises from a cause actually insured against, or
required by this Lease to be insured against; and (b) ”Uninsured Casualty” means damage to or
destruction of the Premises from a cause not actually insured against and not required by this
Lease to be insured against.

          15.2 Insured Casualty.

               15.2.1 Rebuilding Required. In the event of an Insured Casualty where the extent of
damage or destruction is less than twenty-five percent (25%) of the then full replacement cost of
the Premises, Landlord shall rebuild or restore the Premises to the condition existing immediately
prior to the damage or destruction and that
there exist no governmental codes or regulations that would interfere with Landlord’s ability to so
rebuild or restore.

               15.2.2 Landlord’s Election. In the event of an Insured Casualty where the extent of
damage or destruction is equal to or greater than twenty-five percent (25%) of the then full
replacement cost of the Premises, Landlord may, at its option and at its sole discretion, rebuild
or restore the Premises to the condition existing immediately prior to the damage or destruction,
or terminate this Lease. Landlord shall notify Tenant in writing within sixty (60) days after the
event of damage or destruction of Landlord’s election to either rebuild or restore the Premises or
terminate this Lease.

               15.2.3 Continuance of Lease. Subject to Tenant’s right to terminate this Lease
pursuant to Section 15.4 below, if Landlord is required to rebuild or restore the Premises pursuant
to

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Paragraph 15.2.1 or if Landlord elects to rebuild or restore the Premises pursuant to Paragraph
15.2.2 or Paragraph 15.3.2 below, this Lease shall remain in effect and Rental shall be
proportionately reduced during any period of repair or restoration based upon the extent to which
the damage or destruction interferes with Tenant’s business conducted in the Premises, as
reasonably determined by Landlord and Tenant, and Tenant shall have no other claim against Landlord
for compensation for inconvenience or loss of business during any period of repair or restoration.

          15.3 Uninsured Casualty.

               15.3.1 Damage Less than $100,000. In the event of an Uninsured Casualty, where the
extent of damage or destruction to the Premises is less than One Hundred Thousand Dollars
($100,000), as determined in the reasonable opinion of Landlord’s architect or construction
consultants (which opinion shall be delivered in writing to Tenant within thirty (30) days
following any damage or destruction that is subject to this Section 15.3.1), Landlord shall rebuild
or restore the Premises as soon as reasonably possible at Landlord’s expense (unless the damage or
destruction was caused by a negligent or willful act of Tenant, in which event Tenant shall pay all
costs of rebuilding or restoring), in which event this Lease shall continue in full force and
effect.

               15.3.2 Damage Equal to or Greater than $100,000. In the event of an Uninsured
Casualty where the extent of damage or destruction is equal to or greater than One Hundred Thousand
Dollars ($100,000), as determined in the reasonable opinion of Landlord’s architect or construction
consultants (which opinion shall be delivered in writing to Tenant within thirty (30) days
following any damage or destruction that is subject to this Section 15.3.2), Landlord may elect to
(i) rebuild or restore the Premises as soon as reasonably possible at Landlord’s expense (unless
the damage or destruction was caused by a negligent or willful act of Tenant, in which event Tenant
shall pay all costs of rebuilding or restoring), in which event this Lease shall continue in full
force and effect or (ii) terminate this Lease, in which event Landlord shall give written notice to
Tenant within sixty (60) days after the event of damage or destruction of Landlord’s election to
terminate this Lease as of the date of the event of damage or
destruction, and if the damage or destruction was caused by a negligent or willful act of Tenant,
Tenant shall be liable therefor.

          15.4 Tenant’s Election. Notwithstanding anything to the contrary contained in this
Paragraph 15, Tenant may elect to terminate this Lease in the event the Premises are damaged or
destroyed and, in the reasonable opinion of Landlord’s architect or construction consultants (which
opinion shall be delivered in writing to Tenant within thirty (30) days following any damage or
destruction that is subject to this Section 15), the restoration of the Premises cannot be
substantially completed within one hundred eighty (180) days after the event of damage or
destruction. Tenant’s election shall be made by written notice to Landlord within thirty (30) days
after Tenant receives from Landlord the estimate of the time needed to complete repair or
restoration of the Premises. If Tenant does not deliver said notice within said thirty (30) day
period, Tenant may not later terminate this Lease even if substantial completion of the rebuilding
or restoration occurs subsequent to said one hundred eighty (180) day period, provided that
Landlord is proceeding with diligence to rebuild or restore the Premises. If Tenant

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delivers said
notice within said thirty (30) day period, this Lease shall terminate as of the date of the event
of damage or destruction.

          15.5 Damage or Destruction Near End of Lease Term. Notwithstanding anything to the
contrary contained in this Paragraph 15, in the event the Premises are damaged or destroyed in
whole or in part (regardless of the extent of damage) from any cause during the last twelve (12)
months of the Lease Term, Landlord or Tenant may, at its option, terminate this Lease as of the
date of the event of damage or destruction by giving written notice to the other of its election to
do so within thirty (30) days after the event of such damage or destruction. For purposes of this
Paragraph 15.5, if Tenant has been granted an option to extend or renew the Lease Term pursuant to
another provision of this Lease, then the damage or destruction shall be deemed to have occurred
during the last twelve (12) months of the Lease Term if Tenant fails to exercise its option to
extend or renew within twenty (20) days after the event of damage or destruction.

          15.6 Termination of Lease. If the Lease is terminated pursuant to this Paragraph 15,
the unused balance of the Security Deposit shall be refunded to Tenant. The current Rent shall be
proportionately reduced during the period following the event of damage or destruction until the
date on which Tenant surrenders the Premises, based upon the extent to which the damage or
destruction interferes with Tenant’s business conducted in the Premises, as reasonably determined
by Landlord and Tenant. All other Rentals due hereunder shall continue unaffected during such
period. The proceeds of insurance carried by Tenant pursuant to Paragraph 8.2 shall be paid to
Landlord and Tenant, as their interests appear.

          15.7 Abatement of Rentals. If the Premises are to be rebuilt or restored pursuant to
this Paragraph 15, the then current Rentals shall be proportionately reduced during the period of
repair or restoration, based upon the extent to which the making of repairs interferes with
Tenant’s business conducted in the Premises, as reasonably
determined by Landlord and Tenant, to the extent such loss is covered as an insured peril by the
insurance carried, or required to be carried, by Landlord pursuant to Paragraph 8.1.

          15.8 Liability for Personal Property. Except for the breach of this Lease by Landlord
or the negligent acts or willful misconduct of Landlord or that of its agents, employees,
contractors or invitees, in no event shall Landlord have any liability for, nor shall it be
required to repair or restore, any injury or damage to any Alterations to the Premises made by
Tenant, trade fixtures, equipment, merchandise, furniture, or any other property installed by
Tenant or at the expense of Tenant. If Landlord or Tenant do not elect to terminate this Lease
pursuant to this Paragraph 15, Tenant shall be obligated to promptly rebuild or restore the same to
the condition existing immediately prior to the damage or destruction in accordance with the
provisions of Paragraph 13.1.

     16. Condemnation.

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          16.1 Definition of Terms. For the purposes of this Lease, the term: (a) ”Taking”
means a taking of the Premises, Common Area (including the parking areas) or Building or damage
related to the exercise of the power of eminent domain and includes, without limitation, a
voluntary conveyance, in lieu of court proceedings, to any agency, authority, public utility,
person or corporate entity empowered to condemn property; (b) ”Total Taking” means the Taking of
the entire Premises or so much of the Premises, Building or Common Area as to prevent or
substantially impair the use thereof by Tenant for the uses herein specified; (c) ”Partial Taking”
means the Taking of only a portion of the Premises, Building or Common Area which does not
constitute a Total Taking; (d) ”Date of Taking” means the date upon which the title to the
Premises, Building or Common Area or a portion thereof, passes to and vests in the condemnor or the
effective date of any order for possession if issued prior to the date title vests in the
condemnor; and (e) ”Award” means the amount of any award made, consideration paid, or damages
ordered as a result of a Taking.

          16.2 Rights. The parties agree that in the event of a Taking all rights between them
or in and to an Award shall be as set forth herein.

          16.3 Total Taking. In the event of a Total Taking during the Lease Term: (a) the
rights of Tenant under this Lease and the leasehold estate of Tenant in and to the Premises shall
cease and terminate as of the Date of Taking; (b) Landlord shall refund to Tenant any prepaid Rent
and the unused balance of the Security Deposit; (c) Tenant shall pay Landlord any Rentals due
Landlord under the Lease, prorated as of the Date of Taking; (d) to the extent the Award is not
payable to the beneficiary or mortgagee of a deed of trust or mortgage affecting the Premises,
Tenant shall receive from the Award those portions of the Award attributable to trade fixtures of
Tenant; and (e) the remainder of the Award shall be paid to and be the property of Landlord.
Nothing contained in this Paragraph 16.3 shall be deemed to deny Tenant its right to recover
awards made by the condemning authority for moving costs, relocation costs, and costs attributable
to goodwill and leasehold improvements installed by Tenant.

          16.4 Partial Taking. In the event of a Partial Taking during the Lease Term: (a) the
rights of Tenant under the Lease and the leasehold estate of Tenant in and to the portion of the
Premises taken shall cease and terminate as of the Date of Taking; (b) from and after the Date of
Taking the Rent shall be an amount equal to the product obtained by multiplying the then current
Rent by the quotient obtained by dividing the fair market value of the Premises immediately after
the Taking by the fair market value of the Premises immediately prior to the Taking; (c) to the
extent the Award is not payable to the beneficiary or mortgagee of a deed of trust or mortgage
affecting the Premises, Tenant shall receive from the Award the portions of the Award attributable
to trade fixtures of Tenant; and (d) the remainder of the Award shall be paid to and be the
property of Landlord. Each party waives the provisions of California Code of Civil Procedure
Section 1265.130 allowing either party to petition the Superior Court to terminate this Lease in
the event of a Partial Taking. Nothing contained in this Paragraph 16.4 shall be deemed to deny
Tenant its right to recover awards made by the condemning authority for moving costs, relocation
costs, and costs attributable to goodwill and leasehold improvements installed by Tenant.

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     17. Liens.

          17.1 Premises to Be Free of Liens. Tenant shall pay for all labor and services
performed for, and all materials used by or furnished to Tenant, Tenant’s agents, or any contractor
employed by Tenant with respect to the Premises. Tenant shall indemnify, defend and hold Landlord
harmless from and keep the Project free from any liens, claims, demands, encumbrances, or
judgments, including all costs, liabilities and attorneys’ fees with respect thereto, created or
suffered by reason of any labor or services performed for, or materials used by or furnished to
Tenant or Tenant’s agents or any contractor employed by Tenant with respect to the Premises.
Landlord shall have the right, at all times, to post and keep posted on the Premises any notices
permitted or required by law, or which Landlord shall deem proper for the protection of Landlord
and the Premises, Building, Common Area and Land, and any other party having an interest therein,
from mechanics’ and materialmen’s liens, including without limitation a notice of
nonresponsibility. In the event Tenant is required to post an improvement bond with a public
agency in connection with any work performed by Tenant on or to the Premises, Tenant shall include
Landlord as an additional obligee.

          17.2 Notice of Lien; Bond. Should any claims of lien be filed against, or any action
be commenced affecting the Premises, Tenant’s interest in the Premises or any other portion of the
Project, Tenant shall give Landlord notice of such lien or action within thirty (30) days after
Tenant receives notice of the filing of the lien or the commencement of the action. In the event
that Tenant shall not, within sixty (60) days following the imposition of any such lien, cause such
lien to be released of record by payment or posting of a proper bond, Landlord shall have, in
addition to all other remedies provided herein and by law, the right, but not the obligation, to
cause the same to be released by such means as Landlord shall deem proper, including payment of the
claim giving rise to such lien or posting of a proper bond. All such sums paid by Landlord and all
expenses incurred by Landlord in connection therewith,
including attorneys’ fees and costs, shall be payable to Landlord by Tenant as Additional Rent
within thirty (30) days of written notice.

     18. Landlord’s Right of Access to Premises. Landlord reserves and shall have the
right and Tenant and Tenant’s agents shall permit Landlord and Landlord’s agents to enter the
Premises at any reasonable time during normal business hours (except in the event of an emergency)
and subject to any security measures of Tenant that are applied to visitors to the Premises on a
non-discriminatory basis for the purpose of (i) inspecting the Premises, (ii) performing Landlord’s
maintenance and repair responsibilities set forth herein, (iii) posting notices of
nonresponsibility, (iv) placing upon the Premises at any time “For Sale” signs, (v) placing on the
Premises ordinary “For Lease” signs at any time within one hundred eighty (180) days prior to Lease
Termination, or at any time Tenant is in uncured default hereunder, or at such other times as
agreed to by Landlord and Tenant, (vi) protecting the Premises in the event of an emergency and
(vii) exhibiting the Premises to prospective purchasers or lenders at any reasonable time or to
prospective tenants within one hundred eighty (180) days prior to Lease Termination. In the event
of an emergency, Landlord shall have the right to use any and all means which Landlord reasonably
may deem proper to gain access to the Premises. Any entry to the Premises by Landlord or
Landlord’s agents in accordance with this Paragraph 18 or any other

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provision of this Lease shall
not under any circumstances be construed or deemed to be a forcible or unlawful entry into, or a
detainer of the Premises, or an eviction of Tenant from the Premises or any portion thereof nor
give Tenant the right to abate the Rentals payable under this Lease. Except to the extent caused
by the negligence or willful misconduct of Landlord, its agents, employees, contractors or
invitees, Tenant hereby waives any claims for damages for any injury or inconvenience to or
interference with Tenant’s business, any loss of occupancy or quiet enjoyment of the Premises, and
any other loss occasioned by Landlord’s or Landlord’s agents’ entry into the Premises as permitted
by this Paragraph 18 or any other provision of this Lease. Notwithstanding anything to the
contrary contained in this Lease, Landlord and Landlord’s agents, except in the case of emergency,
shall provide Tenant with two (2) business days notice prior to entry of the Premises. Any entry
by Landlord and Landlord’s agents shall not impair Tenant’s operations more than reasonably
necessary, and Tenant shall have the right to have an employee accompany Landlord at all times that
Landlord is present on the Premises.

     19. Landlord’s Right to Perform Tenant’s Covenants. Except as otherwise expressly
provided herein, if Tenant shall at any time fail to make any payment or perform any other act
required to be made or performed by Tenant under this Lease, Landlord may upon thirty (30) days
written notice to Tenant, but shall not be obligated to and without waiving or releasing Tenant
from any obligation under this Lease, make such payment or perform such other act to the extent
that Landlord may deem desirable, and in connection therewith, pay expenses and employ counsel.
All reasonable sums so paid by Landlord and all penalties, interest and reasonable costs in
connection therewith shall be due and payable by Tenant as Additional Rent upon demand.

     20. Lender Requirements.

          20.1 Subordination. Subject to the last sentence of this Section 20.1, this Lease, at
Landlord’s option, shall be subject and subordinate to the lien of any mortgages or deeds of trust
(including all advances thereunder, renewals, replacements, modifications, supplements,
consolidations, and extensions thereof) in any amount(s) whatsoever now or hereafter placed on or
against or affecting the Premises, Building or Land, or Landlord’s interest or estate therein
without the necessity of the execution and delivery of any further instruments on the part of
Tenant to effectuate such subordination. If any mortgagee or beneficiary shall elect to have this
Lease prior to the lien of its mortgage or deed of trust, and shall give written notice thereof to
Tenant, this Lease shall be deemed prior to such mortgage or deed of trust, whether this Lease is
dated prior or subsequent to the date of such mortgage or deed of trust or the date of the
recording thereof. Any subordination of this Lease, or Tenant’s rights hereunder, to any mortgages
or deeds of trust hereafter placed on or against or affecting the Premises, Building or Land, or
Landlord’s interest or estate therein, shall be conditioned on the mortgagee or beneficiary
agreeing that this Lease shall not be terminated or modified in any material way and Tenant’s quiet
possession of the Premises shall not be disturbed in the event of any foreclosure if Tenant is not
in default under this Lease. In the event that any mortgages or deeds of trust affect the
Premises, Building or Land, or Landlord’s interest or estate therein as of the Commencement Date,
Landlord shall exert its best reasonable efforts to obtain and deliver to Tenant prior to the
Commencement Date a non-disturbance agreement in a form reasonably acceptable to Tenant and
executed by the mortgagee(s) or beneficiary(ies) thereunder.

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          20.2 Subordination Agreements. Tenant shall execute and deliver, without charge
therefor, such further instruments reasonably acceptable to Tenant evidencing subordination of this
Lease to the lien of any mortgages or deeds of trust affecting the Premises, Building or Land as
may be required by Landlord within fifteen (15) days following Landlord’s request therefor;
provided that such mortgagee or beneficiary under such mortgage or deed of trust agrees in writing
that this Lease shall not be terminated or modified in any material way and Tenant’s quiet
possession of the Premises shall not be disturbed in the event of any foreclosure if Tenant is not
in default under this Lease. Failure of Tenant to execute such instruments evidencing
subordination of this Lease shall constitute a Default by Tenant hereunder.

          20.3 [Intentionally Omitted]

          20.4 Attornment. In the event of foreclosure or the exercise of the power of sale
under any mortgage or deed of trust made by Landlord and covering the Premises, Building or Land,
Tenant shall attorn to the purchaser upon any such foreclosure or sale and recognize such purchaser
as the Landlord under this Lease, provided such purchaser expressly agrees in writing to be bound
by the terms of the Lease, including, but not limited to, the quiet enjoyment provisions of
Paragraph 40.

          20.5 Estoppel Certificates and Financial Statements.

               (a) Delivery by Tenant. Tenant shall, within fifteen (15) days following request by
Landlord therefor and without charge, execute and deliver to Landlord any and all documents, estoppel certificates, and current financial statements
of Tenant reasonably requested by Landlord in connection with the sale or financing of the
Premises, Building or Land, or requested by any lender making a loan affecting the Premises,
Building or Land. Landlord may require that Tenant in any estoppel certificate shall (i) certify
that this Lease is unmodified and in full force and effect (or, if modified, state the nature of
such modification and certify that this Lease, as so modified, is in full force and effect) and has
not been assigned, (ii) certify the date to which Rentals are paid in advance, if any, (iii)
acknowledge that there are not, to Tenant’s knowledge, any uncured defaults on the part of Landlord
hereunder, or specify such defaults if claimed, (iv) evidence the status of this Lease as may be
required either by a lender making a loan to Landlord to be secured by a deed of trust or mortgage
covering the Premises, Building or Land or a purchaser of the Premises, Building or Land from
Landlord, (v) warrant that in the event any beneficiary of any security instrument encumbering the
Premises, Building or Land forecloses on the security instrument or sells the Premises, Building or
Land pursuant to any power of sale contained in such security instrument, such beneficiary shall
not be liable for the Security Deposit, unless the Security Deposit actually has been received by
the beneficiary from Landlord, (vi) certify the date Tenant entered into occupancy of the Premises
and that Tenant is conducting business at the Premises, (vii) certify that all improvements to be
constructed on the Premises by Landlord have been substantially completed except for punch list
items which do not prevent Tenant from using the Premises for its intended use, and (viii) certify
such other matters relating to the Lease and/or Premises as may be reasonably requested by a lender
making a loan to Landlord or a purchaser of the Premises, Building or Land from Landlord. Any such
estoppel

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certificate may be conclusively relied upon by any prospective purchaser or encumbrancer
of the Premises, Building or Land.

               (b) Nondelivery by Tenant. Tenant’s failure to deliver estoppel certificates or other
documents as required pursuant to Paragraph 20.5(a) above shall be a Default by Tenant.

     21. Holding Over. This Lease shall terminate without further notice at the expiration
of the Lease Term. It is the desire of Landlord either to enter into a new lease with Tenant for
the Premises prior to the expiration of the Lease Term, or to have Tenant vacate the Premises upon
expiration of the Lease Term pursuant to Paragraph 35 below. Therefore, any holding over by Tenant
after Lease Termination shall not constitute a renewal or extension of the Lease Term, nor give
Tenant any rights in or to the Premises except as expressly provided in this Lease. Any holding
over after Lease Termination with the consent of Landlord shall be construed to be a tenancy from
month to month, at one hundred twenty five percent (125%) of the monthly Rent for the month
preceding Lease Termination in addition to all Additional Rent payable hereunder, and shall
otherwise be on the terms and conditions herein specified insofar as applicable. If Tenant remains
in possession of the Premises after Lease Termination without Landlord’s consent, Tenant shall
indemnify, defend and hold Landlord harmless from and against any loss, damage, expense, claim or
liability resulting from Tenant’s failure to surrender the Premises, including without limitation,
any claims made by any succeeding tenant based on delay in the availability of the Premises.

     22. Notices. Any notice required or desired to be given under this Lease shall be in
writing, and all notices shall be given by mailing. All notices personally given on Tenant may be
delivered to any person apparently in charge at the Premises, on any corporate officer or agent of
Tenant if Tenant is a corporation, or on any one signatory party if more than one party signs this
Lease on behalf of Tenant (provided such signatory is then employed by Tenant); any notice so given
shall be binding upon all signatory parties as if served upon each such party personally; provided
that a courtesy copy must be mailed to the address listed in Paragraph 1.12. Any notice given
pursuant to this Paragraph 22 shall be deemed to have been given when personally delivered, or if
mailed to the party at the last address given for purposes of notice pursuant to the provisions of
this Paragraph 22, upon actual receipt or refusal of delivery. At the date of execution of this
Lease, the addresses of Landlord and Tenant are set forth in Paragraph 1.12 above.

     23. Attorneys’ Fees. In the event either party hereto shall bring any action or legal
proceeding for damages for an alleged breach of any provision of this Lease, to recover Rentals, to
enforce an indemnity, defense or hold harmless obligation, to terminate the tenancy of the
Premises, or to enforce, protect, interpret, or establish any term, condition, or covenant of this
Lease or right or remedy of either party, the prevailing party shall be entitled to recover, as a
part of such action or proceeding, reasonable attorneys’ fees and court costs, including reasonable
attorneys’ fees and costs for appeal, as may be fixed by the court or jury. Notwithstanding
anything to the contrary contained in this Lease, “prevailing party” as used in this paragraph
shall include the party who dismisses an action for recovery hereunder in exchange for sums
allegedly

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due, performance of covenants allegedly breached or considerations substantially equal to
the relief sought in the action.

     24. Assignment, Subletting and Hypothecation.

          24.1 In General. Tenant shall not voluntarily sell, assign or transfer all or any
part of Tenant’s interest in this Lease or in the Premises or any part thereof, sublease all or any
part of the Premises, or permit all or any part of the Premises to be used by any person or entity
other than Tenant or Tenant’s employees, except as specifically provided in this Paragraph 24.

          24.2 Voluntary Assignment and Subletting.

               (a) Notice to Landlord. Tenant shall, by written notice, advise Landlord of Tenant’s
desire on a stated date (which date shall not be less than fifteen (15) days nor more than one
hundred twenty (120) days after the date of Tenant’s notice) to assign this Lease or to sublet all
or any part of the Premises for any part of the Lease Term. Said notice shall state that the
notice constitutes an offer to terminate the Lease pursuant to Paragraph 24.2(b) if the notice
applies to a proposed assignment of the Lease or Tenant’s interest herein. Tenant’s notice shall
state the name, legal composition and address of the proposed assignee or subtenant, and Tenant
shall provide the following information to Landlord
with said notice: a true and complete copy of the proposed assignment agreement or sublease; a
financial statement of the proposed assignee or subtenant prepared in accordance with generally
accepted accounting principles within one year prior to the proposed effective date of the
assignment or sublease; the nature of the proposed assignee’s or subtenant’s business to be carried
on in the Premises; the payments to be made or other consideration to be given on account of the
assignment or sublease; and such other pertinent information as may be reasonably requested by
Landlord, all in sufficient detail to enable Landlord to evaluate the proposed assignment or
sublease and the prospective assignee or subtenant. Tenant’s notice shall not be deemed to have
been served or given until such time as Tenant has provided Landlord with all information
reasonably requested by Landlord pursuant to this Paragraph 24.2. Tenant shall immediately notify
Landlord of any modification to the proposed terms of such assignment or sublease. Tenant may
withdraw its notice at any time prior to or after exercise by Landlord of Landlord’s right to
terminate as described in Paragraph 24.2(b).

               (b) Offer to Terminate. Except in the event of a transfer for which Landlord’s
consent is not required pursuant to Section 24.2 below or in the event of any sublease of less that
fifty percent (50%) of the Building, if Tenant notifies Landlord of its desire to assign this Lease
or Tenant’s interest herein, Tenant’s notice shall constitute an offer to terminate this Lease and
Landlord shall have the right, to be exercised by giving written notice to Tenant within fifteen
(15) days after receipt of Tenant’s notice, to terminate the Lease. If Landlord elects to
terminate, then within ten (10) days after receipt of Landlord’s election, Tenant shall have the
right to rescind its request to assign, and this Lease shall continue in full force and effect. If
Tenant does not rescind its request, this Lease shall terminate on the date stated in the notice
given by Tenant pursuant to Paragraph 24.2(a), subject to any obligations which have accrued and
are unfulfilled as of such date.

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     Notwithstanding anything to the contrary in this Section 24, Landlord shall not elect to
terminate the Lease if the net worth of the proposed assignee or subtenant is equal to or greater
than $50,000,000.

               (c) Landlord’s Consent. If Landlord does not exercise its right to terminate pursuant
to Paragraph 24.2(b) within fifteen (15) days after receipt of Tenant’s notice or if Tenant
proposes a sublease, Landlord shall not unreasonably withhold or delay its consent to the proposed
assignment or subletting, on the terms and conditions specified in said notice. If Tenant’s notice
fails to state that it constitutes an offer to terminate the Lease as may be required pursuant to
Paragraph 24.2(a), such notice shall be deemed insufficient for the purposes of this Paragraph
24.2, and Landlord may withhold its consent to the proposed assignment in Landlord’s absolute
discretion. Without otherwise limiting the criteria upon which Landlord may withhold its consent
to any proposed assignment or sublease, if Landlord withholds its consent where Tenant is in
Default at the time of the giving of Tenant’s notice such withholding of consent shall be
presumptively reasonable. Seventy-five percent (75%) of any and all rent paid by an assignee or
subtenant in excess of the Rentals to be paid under this Lease (prorated in the event of a sublease
of less than the entire Premises), after Tenant’s deduction therefrom of all reasonable costs to
effect the assignment or subletting, including without limitation, brokerage commissions,
attorneys’ fees, and the cost of leasehold
improvements or alterations installed or redecorating performed by Tenant for the sublessee, shall
be paid directly to Landlord, as Additional Rent, at the time and place specified in this Lease.
For the purposes of this Paragraph 24, the term “rent” shall include any consideration of any kind
received, or to be received, by Tenant from an assignee or subtenant, if such sums are related to
Tenant’s interest in this Lease or in the Premises, including, but not limited to key money, bonus
money, and payments (in excess of the fair market value thereof) for Tenant’s assets, fixtures,
trade fixtures, inventory, accounts, goodwill, equipment, furniture, general intangibles, and any
capital stock or other equity ownership interest of Tenant. Any assignment or subletting without
Landlord’s consent shall be voidable at Landlord’s option, and shall constitute a Default by
Tenant. Landlord’s consent to any one assignment or sublease shall not constitute a waiver of the
provisions of this Paragraph 24 as to any subsequent assignment or sublease nor a consent to any
subsequent assignment or sublease; further, Landlord’s consent to an assignment or sublease shall
not release Tenant from Tenant’s obligations under this Lease, and Tenant shall remain jointly and
severally liable with the assignee or subtenant. Notwithstanding the foregoing, nothing in this
Section 24.2(c) shall applicable to any transfer for which Landlord’s consent is not required
pursuant to Section 24.2 below.

               (d) Assumption of Obligations. In the event Landlord consents to any assignment, such
consent shall be conditioned upon the assignee expressly assuming and agreeing to be bound by each
of Tenant’s covenants, agreements and obligations contained in this Lease, pursuant to a written
assignment and assumption agreement in a form reasonably approved by Landlord. Landlord’s consent
to any assignment or sublease shall be evidenced by Landlord’s signature on said assignment and
assumption agreement or on said sublease or by a separate written consent. In the event Landlord
consents to a proposed assignment or sublease, such assignment or sublease shall be valid and the
assignee or subtenant shall have the right to

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take possession of the Premises only if an executed
original of the assignment or sublease is delivered to Landlord, and such document contains the
same terms and conditions as stated in Tenant’s notice to Landlord given pursuant to Paragraph
24.2(a) above, except for any such modifications to which Landlord has consented in writing.

          24.3 Collection of Rent. Tenant hereby irrevocably gives to and confers upon
Landlord, as security for Tenant’s obligations under this Lease, the right, power and authority to
collect all rents from any assignee or subtenant of all or any part of the Premises as permitted by
this Paragraph 24, or otherwise, and Landlord, as assignee of Tenant, or a receiver for Tenant
appointed on Landlord’s application, may collect such rent and apply it toward Tenant’s obligations
under this Lease; provided, however, that until the occurrence of any Default by Tenant, subject to
applicable cure periods, or except as provided by the provisions of Paragraph 24.2(c) above, Tenant
shall have the right to collect such rent. Upon the occurrence of any Default by Tenant, Landlord
may at any time without notice in Landlord’s own name sue for or otherwise collect such rent,
including rent past due and unpaid, and apply the same, less costs and expenses of operation and
collection, including reasonable attorneys’ fees, toward Tenant’s obligations under this Lease.
Landlord’s collection of such rents shall not constitute an acceptance by Landlord of attornment by
such subtenants. In the event of a Default by Tenant, Landlord shall have all rights provided by
this Lease and by law, and Landlord may, upon re-entry and taking possession of the Premises, eject
all parties in possession
or eject some and not others, or eject none, as Landlord shall determine in Landlord’s sole
discretion.

          24.4 Corporations and Partnerships. If Tenant is a partnership, any withdrawal or
substitution (whether voluntary, involuntary, or by operation of law and whether occurring at one
time or over a period of time) of any partner(s) owning fifty percent (50%) or more (cumulatively)
of the partnership, any assignment(s) of fifty percent (50%) or more (cumulatively) of any interest
in the capital or profits of the partnership, or the dissolution of the partnership shall be deemed
an assignment of this Lease requiring the prior written consent of Landlord. If Tenant is a
corporation, any dissolution, merger, consolidation or other reorganization of Tenant, any sale or
transfer (or cumulative sales or transfers) of the capital stock of Tenant in excess of fifty
percent (50%), or any sale (or cumulative sales) of all of the assets of Tenant shall be deemed an
assignment of this Lease requiring the prior written consent of Landlord, which shall not be
unreasonably withheld or delayed. Any such withdrawal or substitution of partners or assignment of
any interest in or dissolution of a partnership tenant, and any such sale of stock or assets of a
corporate tenant without the prior written consent of Landlord shall be a Default by Tenant
hereunder. The foregoing notwithstanding, the sale or transfer of any or all of the capital stock
of a corporation, the capital stock of which is now or hereafter becomes publicly traded, shall not
be deemed an assignment of this Lease.

     Notwithstanding anything to the contrary contained in this Lease, Tenant, without Landlord’s
prior written consent (but with notice to Landlord), may sublet the Premises or assign this Lease
to (i) a subsidiary, affiliate, division or corporation controlled by or under common control with
Tenant; (ii) a successor corporation related to Tenant by merger, consolidation, non-bankruptcy
reorganization or government action; or (iii) a purchaser of substantially all of Tenant’s assets
located at the Premises or the capital stock of Tenant, provided that in either of

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the instances
described in the foregoing subparagraphs (ii) or (iii) the successor or purchaser has a net worth
not less than the net worth of Tenant at the time that Tenant executes this Lease (each, a
“Permitted Assignee”). Notwithstanding that a Transfer is made to a Permitted Assignee, Tenant
shall not be released from any of its obligations under this Lease and such Permitted Assignee
shall be required to assume all of Tenant’s obligations hereunder as a condition to such transfer
being permitted without Landlord’s prior written consent.

          24.5 Reasonable Provisions. Tenant expressly agrees that the provisions of this
Paragraph 24 are not unreasonable standards or conditions for purposes of Section 1951.4(b)(2) of
the California Civil Code, as amended from time to time, under bankruptcy laws, or for any other
purpose.

          24.6 Attorneys’ Fees. Tenant shall pay, as Additional Rent, Landlord’s reasonable
attorneys’ fees up to a maximum amount of One Thousand Five Hundred Dollars ($1,500) for reviewing,
investigating, processing and/or documenting any requested assignment or sublease, whether or not
Landlord’s consent is granted.

          24.7 Involuntary Transfer. No interest of Tenant in this Lease shall be assignable
involuntarily or by operation of law, including, without
limitation, the transfer of this Lease by testacy or intestacy. Each of the following acts shall
be considered an involuntary assignment:

               (a) If Tenant is or becomes bankrupt or insolvent, makes an assignment for the benefit of
creditors, or a proceeding under any bankruptcy law is instituted in which Tenant is the bankrupt;
or, if Tenant is a partnership or consists of more than one person or entity, if any partner of the
partnership or other person or entity is or becomes bankrupt or insolvent, or makes an assignment
for the benefit of creditors;

               (b) Levy of a writ of attachment or execution on this Lease;

               (c) Appointment of a receiver with authority to take possession of the Premises in any
proceeding or action to which Tenant is a party; or

               (d) Foreclosure of any lien affecting Tenant’s interest in the Premises, which lien was not
consented to by Landlord pursuant to Paragraph 24.9.

An involuntary assignment shall constitute a Default by Tenant and Landlord shall have the right to
terminate this Lease, in which case this Lease shall not be treated as an asset of Tenant. In the
event the Lease is not terminated, the provisions of Paragraph 24.2(c) regarding rents paid by an
assignee or subtenant shall apply. If a writ of attachment or execution is levied on this Lease,
or if any involuntary proceeding in bankruptcy is brought against Tenant or a receiver is
appointed, Tenant shall have sixty (60) days in which to cause the attachment or execution to be
removed, the involuntary proceeding dismissed, or the receiver removed.

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          24.8 Hypothecation. Tenant shall not hypothecate, mortgage or encumber Tenant’s
interest in this Lease or in the Premises or otherwise use this Lease as a security device in any
manner without the consent of Landlord, which consent Landlord may withhold in its sole and
absolute discretion. Consent by Landlord to any such hypothecation or creation of a lien or
mortgage shall not constitute consent to an assignment or other transfer of this Lease following
foreclosure of any permitted lien or mortgage.

          24.9 Binding on Successors. The provisions of this Paragraph 24 expressly apply to
all heirs, successors, sublessees, assignees and transferees of Tenant.

     25. Successors. Subject to the provisions of Paragraph 24 above and Paragraph 30.2(a)
below, the covenants, conditions, and agreements contained in this Lease shall be binding on the
parties hereto and on their respective heirs, successors and assigns.

     26. Landlord Default; Mortgagee Protection. Landlord shall not be in default under
this Lease unless Tenant shall have given Landlord written notice of the breach and, within thirty
(30) days after notice, Landlord has not cured the breach or, if the breach is such that it cannot
reasonably be cured under the circumstances within thirty (30) days, has not commenced diligently
to prosecute the cure to
completion. Any money judgment obtained by Tenant based upon Landlord’s breach of this Lease shall
be satisfied only out of the proceeds of the sale or disposition of Landlord’s interest in the
Premises (whether by Landlord or by execution of judgment). In the event of any default on the
part of Landlord under this Lease, Tenant shall give notice by registered or certified mail to any
beneficiary of a deed of trust or any mortgagee of a mortgage affecting the Premises, Building or
Land whose address shall have been furnished to Tenant, and shall offer such beneficiary or
mortgagee a reasonable opportunity to cure the default, including time to obtain possession of the
Premises by power of sale or judicial foreclosure, if such should prove necessary to effect a cure.

     27. Exhibits. All exhibits attached to this Lease shall be deemed to be incorporated
herein by the individual reference to each such exhibit, and all such exhibits shall be deemed to
be a part of this Lease as though set forth in full in the body of the Lease.

     28. Surrender of Lease Not Merger. The voluntary or other surrender of this Lease by
Tenant, or a mutual cancellation thereof, shall not work a merger and shall, at the option of
Landlord, terminate all or any existing subleases or subtenants, or may, at the option of Landlord,
operate as an assignment to Landlord of any or all such subleases or subtenants.

     29. Waiver. The waiver by Landlord of any breach of any term, covenant or condition
herein contained (or the acceptance by Landlord of any performance by Tenant after the time the
same shall become due) shall not be deemed to be a waiver of such term, covenant or condition or
any subsequent breach thereof or of any other term, covenant or condition herein contained, unless
otherwise expressly agreed to by Landlord in writing. The acceptance by Landlord of any sum less
than that which is required to be paid by Tenant shall be deemed to have been received only on
account of the obligation for which it is paid (or for which it is allocated by Landlord, in
Landlord’s reasonable discretion, if Tenant does not designate the obligation as to which the

43

 

payment should be credited), and shall not be deemed an accord and satisfaction notwithstanding any
provisions to the contrary written on any check or contained in any letter of transmittal. The
acceptance by Landlord of any sum tendered by a purported assignee or transferee of Tenant shall
not be deemed a consent by Landlord to any assignment or transfer of Tenant’s interest herein. No
custom or practice which may arise between the parties hereto in the administration of the terms of
this Lease shall be construed as a waiver or diminution of Landlord’s right to demand performance
by Tenant in strict accordance with the terms of this Lease.

     30. General.

          30.1 Captions and Headings. The captions and paragraph headings used in this Lease
are for convenience of reference only. They shall not be construed to limit or extend the meaning
of any part of this Lease, and shall not be deemed relevant in resolving any question of
interpretation or construction of any paragraph of this Lease.

          30.2 Definitions.

               (a) Landlord. The term Landlord as used in this Lease, so far as the covenants or
obligations on the part of Landlord are concerned, shall be limited to mean and include only the
owner at the time in question of the fee title to the Premises. In the event of any transfer(s) of
such interest, the Landlord herein named (and in case of any subsequent transfers or conveyances,
the then grantor) shall have no further liability under this Lease to Tenant except as to matters
of liability which have accrued and are unsatisfied as of the date of such transfer, it being
intended that the covenants and obligations contained in this Lease on the part of Landlord shall
be binding on Landlord and its successors and assigns only during and in respect of their
respective periods of ownership of the fee; provided that any funds in the possession of Landlord
or the then grantor and as to which Tenant has an interest, less any deductions permitted by law or
this Lease, shall be turned over to the grantee. The covenants and obligations contained in this
Lease on the part of Landlord shall, subject to the provisions of this Paragraph 30.2(a), be
binding upon each Landlord and such Landlord’s heirs, personal representatives, successors and
assigns only during its respective period of ownership. Except as provided in this Paragraph
30.2(a), this Lease shall not be affected by any transfer of Landlord’s interest in the Premises,
and Tenant shall attorn to any transferee of Landlord provided that all of Landlord’s obligations
hereunder are assumed in writing by such transferee.

               (b) Agents. For purposes of this Lease and without otherwise affecting the definition
of the word “agent” or the meaning of an “agency,” the term “agents” shall be deemed to include the
agents, employees, officers, directors, servants, invitees, contractors, successors,
representatives, subcontractors, guests, customers, suppliers, partners, affiliated companies, and
any other person or entity related in any way to the respective party, Tenant or Landlord.

               (c) Interpretation of Terms. The words “Landlord” and “Tenant” as used herein shall
include the plural as well as the singular. Words in the neuter gender include the masculine and
feminine and words in the masculine or feminine gender include the neuter.

44

 

          30.3 Copies. Any executed copy of this Lease shall be deemed an original for all
purposes.

          30.4 Time of Essence. Time is of the essence as to each and every provision in this
Lease requiring performance within a specified time.

          30.5 Severability. In case any one or more of the provisions contained herein shall
for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision of this Lease, but this Lease
shall be construed as if such invalid, illegal or unenforceable provision had not been contained
herein. However, if Tenant’s obligation to pay the Rentals is determined to be invalid or
unenforceable, this Lease at the option of Landlord shall terminate.

          30.6 Governing Law. This Lease shall be construed and enforced in accordance with the
laws of the State of California.

          30.7 Joint and Several Liability. If Tenant is more than one person or entity, each
such person or entity shall be jointly and severally liable for the obligations of Tenant
hereunder. If Tenant is a husband and wife, the obligations hereunder shall extend to their sole
and separate property as well as community property.

          30.8 Construction of Lease Provisions. Although printed provisions of this Lease were
prepared by Landlord, this Lease shall not be construed either for or against Tenant or Landlord,
but shall be construed in accordance with the general tenor of the language to reach a fair and
equitable result.

          30.9 Tenant’s Financial Statements. Tenant hereby warrants that, to Tenant’s actual
knowledge, all of Tenant’s publicly available financial statements for the six (6) months prior to
the Date of Lease are true, correct, and complete, and prepared in accordance with generally
accepted accounting principles. Tenant acknowledges and agrees that Landlord is relying on such
financial statements in accepting this Lease, and that a breach of Tenant’s warranty as to such
financial statements shall constitute a Default by Tenant.

          30.10 Withholding of Landlord’s Consent. Notwithstanding any other provision of this
Lease where Tenant is required to obtain the consent (whether written or oral) of Landlord to do
any act, or to refrain from the performance of any act, Tenant agrees that if Tenant is in Default
with respect to any term, condition, covenant or provision of this Lease, then Landlord shall be
deemed to have acted reasonably in withholding its consent if said consent is, in fact, withheld.

     31. Signs. Tenant shall not place or permit to be placed any sign or decoration on
the Land or the exterior of the Building or that would be visible from the exterior of the Building
or Premises, without the prior written consent of Landlord, which consent shall not be unreasonably

45

 

withheld or delayed. Tenant may place “for lease” signs in connection with efforts to assign or
sublease the Premises, subject to the prior written consent of Landlord, which consent shall not be
unreasonably withheld or delayed; provided that all such signs shall be removed not later than the
one hundred eightieth (180th) day prior to Lease Termination. In no event shall any such sign
revolve, rotate, move or create the illusion of revolving, rotating or moving or be internally
illuminated and there shall be no exterior spotlighting or other illumination on any such sign.
Tenant, upon written notice by Landlord, shall immediately remove any of Tenant’s signs or
decorations that are visible from the exterior of the Building or Premises or that Tenant has
placed or permitted to be placed on the Land or the exterior of the Building without the prior
written consent of Landlord, or which remain beyond the one hundred eightieth (180th) day prior to
Lease Termination. If Tenant fails to so remove such sign or decoration within five (5) days after
Landlord’s written notice, Landlord may enter the Premises and remove such sign or decoration and
Tenant shall pay Landlord, as Additional Rent upon demand, the cost of such removal. All signs
placed on the Premises, Building or Land by Tenant shall comply with
applicable statutes, ordinances, rules and regulations of governmental agencies having jurisdiction
thereof. At Landlord’s option, Tenant shall at Lease Termination remove any sign which it has
placed on the Premises, Land or the Building, and shall, at its sole cost, repair any damage caused
by the installation or removal of such sign. Notwithstanding the foregoing provisions of this
Section 31 or any other provisions of this Lease to the contrary, Tenant shall have the right, at
Tenant’s sole cost and expense, to erect monument signage upon the Project adjacent to Garrett
Drive provided such monument signage is in compliance with all Laws and is of a design and in a
location that is reasonably acceptable to Landlord and Tenant.

     32. [Intentionally Omitted].

     33. Landlord Not a Trustee. Landlord shall not be deemed to be a trustee of any funds
paid to Landlord by Tenant (or held by Landlord for Tenant) pursuant to this Lease, including
without limitation the Security Deposit. Landlord shall not be required to keep any such funds
separate from Landlord’s general funds or segregated from any funds paid to Landlord by (or held by
Landlord for) other tenants of the Building. Any funds held by Landlord pursuant to this Lease
shall not bear interest.

     34. Interest. Any payment due from Tenant to Landlord, except for Rent received by
Landlord within thirty (30) days after the same is due, shall bear interest from the date due until
paid, at an annual rate equal to seven percent (7%). In addition, Tenant shall pay all costs and
reasonable attorneys’ fees incurred by Landlord in the collection of such amounts.

     35. Surrender of Premises. On the last day of the Lease Term or upon the sooner
termination of this Lease, Tenant shall, to the reasonable satisfaction of Landlord, surrender the
Premises to Landlord in the same condition as received on the Commencement Date (reasonable wear
and tear, acts of God, casualty, condemnation, Hazardous Materials other than those stored, used or
disposed of by Tenant, its agents, employees, contractors or invitees, and alterations concerning
which Landlord has not reserved the right to require removal excepted) with all interior walls
washed, or repaired if marked or damaged, all carpets cleaned, the air conditioning, ventilating
and heating equipment inspected, serviced and repaired by a reputable and licensed

46

 

service firm
(unless Landlord has elected to maintain heating and air conditioning systems pursuant to Paragraph
10.1 above). Tenant shall remove all of Tenant’s personal property and trade fixtures from the
Premises, and all property not so removed shall be deemed abandoned by Tenant. Furthermore, Tenant
shall repair all damage to the Project caused by any such removal. If the Premises are not so
surrendered at Lease Termination, Tenant shall indemnify, defend and hold Landlord harmless from
and against any loss, damage, expense, claim or liability resulting from delay by Tenant in so
surrendering the Premises including, without limitation, any claims made by any succeeding tenant
or losses to Landlord due to lost opportunities to lease to succeeding tenants.

     36. Labor Disputes. In the event Tenant shall in any manner be involved in or be the
object of a labor dispute which subjects the Premises or any part of the Project to any picketing,
work stoppage or other concerted activity which in the reasonable
opinion of Landlord is detrimental to the operation of the Project or its tenants, Landlord shall
have the right to require Tenant, at Tenant’s own expense and within a reasonable period of time,
to use Tenant’s best efforts to either resolve such labor dispute or terminate or control any such
picketing, work stoppage or other concerted activity to the extent necessary to eliminate any
interference with the operation of the Project. To the extent such labor dispute interferes with
the performance of Landlord’s duties hereunder, Landlord shall be excused from the performance of
such duties. Failure by Tenant to use its best efforts to so resolve such dispute or terminate or
control such picketing, work stoppage or other concerted activity within a reasonable period of
time shall constitute a Default by Tenant hereunder. Nothing contained in this Paragraph 36 shall
be construed as placing Landlord in an employer/employee relationship with any of Tenant’s
employees or with any other employees who may be involved in such labor dispute.

     37. No Partnership or Joint Venture. Nothing in this Lease shall be construed as
creating a partnership or joint venture between Landlord, Tenant, or any other party, or cause
Landlord to be responsible for the debts or obligations of Tenant or any other party.

     38. Entire Agreement. Any agreements, warranties, or representations not expressly
contained herein shall in no way bind either Landlord or Tenant, and Landlord and Tenant expressly
waive all claims for damages by reason of any statement, representation, warranty, promise or
agreement, if any, not contained in this Lease. This Lease supersedes and cancels any and all
previous negotiations, arrangements, brochures, agreements and understandings, whether written or
oral, between Landlord and its agents and Tenant and its agents with respect to the Project or this
Lease. This Lease constitutes the entire agreement between the parties hereto and no addition to,
or modification of, any term or provision of this Lease shall be effective until and unless set
forth in a written instrument signed by both Landlord and Tenant.

     39. Submission of Lease. Submission of this instrument for Tenant’s examination or
execution does not constitute a reservation of space nor an option to lease. This instrument shall
not be effective until executed by both Landlord and Tenant. Execution of this Lease by Tenant
shall constitute an offer by Tenant to lease the Premises, which offer shall be deemed accepted by
Landlord when this Lease is executed by Landlord and delivered to Tenant.

47

 

     40. Quiet Enjoyment. Landlord covenants and agrees with Tenant that upon Tenant
paying Rentals and performing its covenants and conditions under the Lease, Tenant shall and may
peaceably and quietly have, hold and enjoy the Premises for the Lease Term, subject, however, to
the terms of this Lease and of any mortgages or deeds of trust affecting the Premises, and the
rights reserved by Landlord hereunder. Any purchaser upon any foreclosure or exercise of the power
of sale under any mortgage or deed of trust made by Landlord and covering the Premises, Building or
Land to whom Tenant attorns pursuant to Paragraph 20.4 above shall be bound by the terms of this
Paragraph 40.

     41. Authority. The undersigned parties hereby warrant that they have proper authority
and are empowered to execute this Lease on behalf of the Landlord and Tenant, respectively. If
Tenant is a corporation (or partnership), each individual executing this Lease on behalf of said
corporation (or partnership) represents and warrants that he is duly authorized to execute and
deliver this Lease on behalf of said corporation in accordance with a duly adopted resolution of
the Board of Directors of said corporation or in accordance with the by-laws of said corporation
(or on behalf of said partnership in accordance with the partnership agreement of such
partnership), and that this Lease is binding upon said corporation (or partnership) in accordance
with its terms. If Tenant is a corporation, and this Lease is not executed by two corporate
officers, Tenant shall, upon execution of this Lease, deliver to Landlord evidence of the authority
of the individual executing this Lease on behalf of Tenant to execute this Lease on behalf of
Tenant. In the event Tenant should fail to deliver such evidence to Landlord upon execution of
this Lease, Landlord shall not be deemed to have waived its right to require delivery of such
evidence, and at any time during the Lease Term Landlord may request Tenant to deliver the same,
and Tenant agrees it shall thereafter promptly deliver such evidence to Landlord. If Tenant is a
corporation, Tenant warrants that:

               (a) Tenant is a valid and existing corporation;

               (b) Tenant is qualified to do business in California;

               (c) All fees and all franchise and corporate taxes are paid to date, and will be paid when
due;

               (d) All required forms and reports will be filed when due; and

               (e) The signers of this Lease are properly authorized to execute this Lease.

          42. Right of First Offer. Tenant shall have the right of first offer to lease all or
any portion of other building in the Project (the “Second Building”) which right is subject to any
and all rights of the current tenants in the Second Building (said other tenants being Microchip
Technology, Inc. and LeCroy Corporation) with respect to such space (including renewal and
extension rights and rights of first offer, first negotiation, first refusal, other expansion
rights or negotiated extensions or renewals by such tenants). Such right of first offer may only
be exercised with respect to vacant space or space which has been previously leased

48

 

and as to which
an existing tenant of the Second Building has elected not to extend or negotiate to extend its
lease or re-lease such space. If any space qualifying for such right of first offer becomes
available (the “Available Space”), Landlord shall notify Tenant of such availability in writing
and, within ten (10) days following such notice, Tenant shall provide Landlord its written election
(“Tenant’s Election”) to either (i) proceed to negotiate with Landlord for Tenant’s lease of the
Available Space or (ii) terminate its rights to the Available Space under this Section 42. In the
event Tenant fails to timely provide Tenant’s Election, Tenant shall be deemed to have elected to
terminate its rights under this Section 42 effective as of the expiration of such ten (10) day
period. In the event that Tenant timely makes its election to proceed to negotiate with Landlord
for Tenant’s lease of the Available Space, for a period of thirty (30) days following Tenant’s
delivery of Tenant’s Election, Landlord and Tenant shall negotiate in good faith the terms and
conditions of Tenant’s lease of the Available Space. If, despite good faith negotiations, Landlord
and Tenant do not execute a written lease relating to the Available Space within such thirty (30)
days period then Tenant’s rights under this Section 242 shall automatically terminate upon the
expiration of such thirty (30) days period and Landlord may thereafter lease the Available Space to
other prospective tenants.

     43. Counterparts. This Lease may be executed by the parties in different counterparts
and the signature pages and initialed pages combined shall create a document binding on the
parties.

     IN WITNESS WHEREOF, the parties have executed this Lease effective as of the date set forth
below.

	 	 	 	 	 	 	 	 	 	 	 
	LANDLORD:	 	 	 	TENANT:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	COOPERAGE ROSE PROPERTIES,	 	 	 	TRIDENT MICROSYSTEMS, INC.,	 	 
	A general partnership	 	 	 	a corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Terrence J. Rose
 

	 	 
	 	By:
	 	/s/ John S. Edmunds
 

	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date: April 12, 2006	 	 	 	Date: April 11, 2006	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Title: Partner	 	 	 	Title: Chief Financial Officer	 	 

49

 

EXHIBITS

	 	 	 	 	 
	A

	 	Site Plan
	 	Paragraph 1.4 (Land shown cross-hatched in
red pursuant to Paragraph 2.1)
	 
	 	 	 	 
	B

	 	Building
	 	Paragraph 2.1 (Premises shown cross-hatched)
	 
	 	 	 	 
	C

	 	Commencement Date Letter
	 	Paragraph 3.1
	 
	 	 	 	 
	D

	 	Preliminary Plans
	 	Paragraph 2.2.1 and 2.2.2
	 
	 	 	 	 
	E

	 	Preliminary Exterior Work Plans
	 	Paragraph 2.2.3
	 
	 	 	 	 
	F

	 	Permissible Hazardous
Materials
	 	Paragraph 6.4

-1-

 

EXHIBIT A

SITE PLAN

-1-

 

EXHIBIT B

FLOOR PLAN

-1-

 

EXHIBIT C

COMMENCEMENT DATE LETTER

	 	 	 
	LANDLORD:

	 	Cooperage Rose Properties
	 
	 	 
	TENANT:

	 	Trident Microsystems, Inc.
	 
	 	 
	LEASE DATE:

	 	                                        , 2006
	 
	 	 
	PREMISES:

	 	3400 Garrett Drive, Santa Clara, California

Pursuant to Section 3.1 of the above-referenced Lease, the Commencement Date is hereby established
as                                                             , 2006. The Expiration Date is                                                             , 2013.

Tenant acknowledges that Landlord has completed the Interior Work (as defined in Section 2.2.1 of
the Lease) in accordance with the terms of
                                                             of the Lease, and Tenant has accepted
possession of the Premises.

Tenant’s obligation to pay Rent (as that term is defined in the Lease), shall commence on
                                                                                , 2006.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LANDLORD:	 	 	 	 	 	TENANT:
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	COOPERAGE ROSE PROPERTIES,	 	 	 	 	 	TRIDENT MICROSYSTEMS, INC.,
	a general partnership	 	 	 	 	 	a corporation
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 	 	By:	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Title:
	 	 	 	 	 	 	 	 	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 

-1-

 

EXHIBIT D

PRELIMINARY PLANS

-1-

 

EXHIBIT E

PRELIMINARY EXTERIOR WORK PLANS

-1-

 

EXHIBIT F

PERMISSIBLE HAZARDOUS MATERIALS

-1-

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