Document:

Exhibit 10.15

 

Exhibit 10.15

INDUSTRIAL REAL ESTATE LEASE

(Multi-Tenant
Facility)

AMENDED AND RESTATED LEASE.

     This Lease amends and restates in its entirety that certain Industrial Real Estate Lease of
even date herewith by and between the parties hereto (the “ Original Lease Document”), and this
Lease, together with the other documents and instruments referred to herein (other than the
Original Lease Document), shall constitute the entire agreement and understanding between the
parties hereto with respect to the subject matter hereof (except as may be hereafter amended, as
provided below), and the Original Lease Document shall have no further force or effect.

ARTICLE ONE: BASIC TERMS

     This Article One contains the Basic Terms of this Lease between the Landlord and Tenant
named below. Other Articles, Sections and Paragraphs of the Lease referred to in this Article One
explain and define the Basic Terms and are to be read in conjunction with the Basic Terms.

     Section 1.01. Date of Lease: February 23, 2006

     Section 1.02. Landlord (include legal entity): New Goodyear, LTD., a
California Limited Partnership

Address of
Landlord: 9061 SANTA MONICA BLVD., LOS ANGELES, CA 90069

     Section 1.03. Tenant (include legal entity): IsoTis OrthoBiologics, Inc.., a
Washington corporation

Address of Tenant: 2 Goodyear, Irvine Unit A, California

     Section 1.04. Property: The Property is part of Landlord’s multi-tenant real property
development known as 2 Goodyear, Irvine, California (APN #: 591-014-01) and described or
depicted in Exhibit “A” (the “Project”). The Project includes the land, the buildings and all other
improvements located on the land, and the common areas described in Paragraph 4.05(a). The
Property is an approximate 43,538 square foot portion of the Project commonly known as 2
Goodyear, Unit A (See attached Exhibit “B”)

     Section 1.05. Lease Term: Approximately 5 — years and 17 days, beginning on July 15.
2006). and ending on the last day of the sixtieth (60th) full calendar month
thereafter, which date is July 31, 2011

     Section 1.06. Permitted Uses: (See Article Five) General offices, medical product
manufacturing, medical product research and development and distribution of medical products and
other related lawful uses-, including, without limitation, warehousing needs

     Section 1.07. Tenant’s Guarantor: (If none, so state) None 

     Section 1.08. Brokers: (See Article Fourteen) (If none, so state)

Landlord’s Broker: Voit Commercial, Trent Walker

Tenant’s Broker: CB Richard Ellis , Gregg Haly

     Section 1.09. Commission Payable to Landlord’s Broker: (See Article Fourteen) Under
Separate Agreement

     Section 1.10. Initial Security Deposit: (See Section 3.03) $43,538.00

     Section 1.11. Vehicle Parking Spaces Allocated to Tenant: (See Section 4.05) 159
spaces

     Section 1.12. Rent and Other Charges Payable by Tenant:

     (a) BASE
RENT: Forty Three Thousand Five Hundred Thirty Eight and 00/100 Dollars
($43,538) per month for months 1-12, as provided in Section 3.01, and shall be
increased on the first day of the 13th, 25th, 37th, and
49th full calendar month(s) after the Commencement Date, either (i) as
provided in Section 1 of Rider No. 1
Section 3.02., or                     (ii) If (ii) is
completed, than (i) and Section 3.02 are inapplicable.).

     (b) OTHER PERIODIC PAYMENTS: (i) Real Property Taxes (See Section 4.02); (ii) Utilities (See
Section 4.03); (iii) Insurance Premiums (See Section 4.04); (iv) Tenant’s Initial

			
	1988	 	Southern California Chapter 

of the Society of Industrial

and Office Realtors, Inc.

1

 

Pro Rata Share of Common Area Expenses 62.2% (See Section 4.05); (v) Impounds for
Insurance Premiums and Property Taxes (See Section 4.08); (vi) Maintenance, Repairs and Alterations
(See Article Six).

     Section 1.13. Landlord’s Share of Profit on Assignment or Sublease: (See Section 9.05)
FIFTY percent (50%%) of the Profit (the “Landlord’s Share”).

     Section 1.14. Riders: The following Riders are attached to and made a part of this Lease: (If
none, so state) Rider No. 1; Rider No. 2 Option to Extend Lease Term; Exhibit “A” Site Plan ;
Exhibit “B” Tenant Space, Exhibit “C” Tenant Improvement Plan; Exhibit “D” Approved Hazardous
Materials;.

ARTICLE TWO: LEASE TERM

     Section 2.01. Lease of Property For Lease Term. Landlord leases the Property to Tenant and
Tenant leases the Property from Landlord for the Lease Term. The Lease Term is for the period
stated in Section 1.05 above and shall begin and end on the dates specified in Section 1.05 above,
unless the beginning or end of the Lease Term is changed under any
provision of this Lease 
(including, without limitation, Rider No.1). The “Commencement Date” shall be the date
specified in Section 1.05 above for the beginning of the Lease Term, unless advanced or delayed
under any provision of this Lease.

     Section 2.02. Delay in Commencement. Landlord shall not be liable to Tenant if Landlord does
not deliver possession of the Property to Tenant on the Commencement Date. Landlord’s non-delivery
of the Property to Tenant on that date shall not affect this Lease or the obligations of Tenant
under this Lease except that the Commencement Date shall be delayed until Landlord delivers
possession of the Property to Tenant and the Lease Term shall be extended for a period equal to the
delay in delivery of possession of the Property to Tenant, plus the number of days necessary to end
the Lease Term on the last day of a month. If Landlord does not deliver possession of the Property
to Tenant within sixty (60) days after the Commencement Date, Tenant may elect to cancel this
Lease by giving written notice to Landlord within ten (10) days
after such sixty (60)-day period
ends. If Tenant gives such notice, the Lease shall be canceled and neither Landlord nor Tenant
shall have any further obligations to the other. If Tenant does not give such notice, Tenant’s
right to cancel the Lease shall expire and the Lease Term shall commence upon the delivery of
possession of the Property to Tenant. If delivery of possession of the Property to Tenant is
delayed, Landlord and Tenant shall, upon such delivery, execute an amendment to this Lease setting
forth the actual Commencement Date and expiration date of the Lease. Failure to execute such
amendment shall not affect the actual Commencement Date and expiration date of the Lease.

     Section 2.02. Delay of Possession. Upon vacancy of the Property by the Existing Tenant
(anticipated to be on or about April 15th, 2006), Landlord shall deliver possession of
the Property to Tenant and Tenant hereby accepts and acknowledges such delivery.

     Section 2.03. Early Occupancy. Subject to Section 5 of Rider No. 1, Landlord shall
deliver the Property upon execution of the Lease, subject to the Existing Tenant vacating
the Property, estimated to be on or about April 15th, 2006. If Tenant occupies
the Property prior to the Commencement Date, Tenant’s occupancy of the Property shall be
subject to all of the provisions of this Lease. Early occupancy of the Property shall not
advance the expiration date of this Lease. Tenant shall pay utilities charges for the early
occupancy period prior to the Commencement Date, but shall not be obligated to pay Base
Rent, Common Area costs or other charges during such period.

     Section 2.04. Holding Over. Tenant shall vacate the Property upon the expiration or earlier
termination of this Lease. Tenant shall reimburse Landlord for and indemnify Landlord against all
rent loss, which Landlord incurs from Tenant’s delay in vacating the Property. If Tenant does not
vacate the Property upon the expiration or earlier termination of the Lease and Landlord thereafter
accepts rent from Tenant, Tenant’s occupancy of the Property shall be a “month-to-month” tenancy,
subject to all of the terms of this Lease applicable to a month-to-month tenancy, except that the
Base Rent then in effect shall be increased by twenty-five percent (25%).

ARTICLE THREE: BASE RENT

     Section 3.01. Time and Manner of Payment. Upon commencement of the Term, Tenant shall pay
Landlord $43,538.00 for the first month of the Lease Term. On the first day of the second month of
the Lease Term and each month thereafter, Tenant shall pay Landlord the Base Rent in the amount
stated in Paragraph 1.12 (a) above, in advance,

			
	1988	 	Southern California Chapter

of the Society of
Industrial
 and Office
Realtors, Inc.

2

 

without offset, deduction or prior demand. The Base Rent shall be payable at Landlord’s
address or at such other place as Landlord may designate in writing. Notwithstanding the
foregoing, if Commencement Date falls on a day other than the first day of a calendar month,
Base Rent payable with respect to the period between the Commencement Date and the first day of
the following calendar month shall be prorated.

     Section 3.02. Cost of Living Increases. The Base Rent shall be increased on each date-(the
“Rental Adjustment-Date") stated-in-Paragraph 1.12(a) above-accordance-with the increase in the
United States-Department of-Labor,-Bureau-of-Labor Statistics, Consumer-Price Index for U.S. City
Average, All Urban Consumers (all items Los AngeLes-Riverside-Orange County for the geographical
Statistical Area-in-which the Property is locatcd on the basis of
1982-1984=100) (the “Index”) as
follows:

     (a)The
Base Rent (the “Comparison Bose Rent") in effect-immediately before
each Rental Adjustment Date shall be-increased by the percentage that the index has increased from
the date (the “Comparison Date”) on which payment-of-the Comparison Base Rent began through the
month-in which the applicable Rental Adjustment Date occurs. The Base Rent shall not be reduced by
reason of such-computation. Landlord shall-notify Tenant of each increase by a written statement
which shall-include the Index for-the applicable Comparison Date, the Index for the applicable
Rental Adjustment Date, the percentage increase between those two-indices, and the new Base Rent.

     (b)Tenant shall pay the new Base Rent from the applicable Rental Adjustment
Date until the next Rental Adjustment-Date. Landlord’s notice may be given after the applicable
Rental Adjustment-Date-of the increase-,-and Tenant shall pay Landlord the
accrued-rental-adjustment for the months elapsed-between the effective date of the
increase-and-Landlord’s notice of such increase within ten (10) days after Landlord’s notice. If
the format or components-of the index are materially changed-after-the Commencement Date, Landlord
shall substitute an-index which is published by tho Bureau of Labor Statistics or similar-agency
and- which is most nearly equivalent to the Index in effect on the Commencement Date. The
substitute index shall be-used to calculate the increase in the Base Rent unless Tenant objects to
such index in writing within fifteen (15) days-after receipt of Landlord’s notice.—If Tenant
objects, Landlord and Tenant shall submit the selection of-the substitute index for binding
arbitration in accordance-with the rules and regulations of the American Arbitration Association
at-its office closest to the Property. The-costs of arbitration shall
be borne equally by
Landlord-and Tenant.

     Section 3.03. Security Deposit; Increases.

     (a) Upon the execution of this Lease, Tenant shall deposit with Landlord a cash Security
Deposit in the amount set forth in Section 1.10 above. Tenant shall receive a credit for the
amount of the existing Security Deposit on 2 Goodyear, Unit- B, totaling $26,952.35. Landlord may
apply all or part of the Security Deposit to any unpaid rent or other charges due from Tenant or to
cure any other defaults of Tenant. If Landlord uses any part of the Security Deposit, Tenant shall
restore the Security Deposit to its full amount within ten (10) days after Landlord’s written
request. Tenant’s failure to do so shall be a material default under this Lease. No interest
shall be paid on the Security Deposit. Landlord shall not be required to keep the Security Deposit
separate from its other accounts and no trust relationship is created with respect to the Security
Deposit.

     (b) Each time the Base Rent is increased, Tenant shall deposit additional funds with Landlord
sufficient to increase the Security Deposit to an amount which bears the same relationship to the
adjusted Based Rent as the initial Security Deposit bore to the initial Base Rent.

     Section 3.04.
Termination; Advance Payments. Upon termination of this Lease under Article
Seven (Damage or Destruction), Article Eight (Condemnation) or any other termination not resulting
from Tenant’s default, and after Tenant has vacated the Property in the manner required by this
Lease, Landlord shall refund or credit to Tenant (or Tenant’s successor) the unused portion of the
Security Deposit, any advance rent or other advance payments made by Tenant to Landlord, and any
amounts paid for real property taxes and other reserves which apply to any time periods after
termination of the Lease.

ARTICLE FOUR: OTHER CHARGES PAYABLE BY TENANT

     Section 4.01.
Additional Rent. All charges payable by Tenant other than Base Rent are called
“Additional Rent.” Unless this Lease provides otherwise, Tenant shall pay all Additional Rent then
due with the next monthly installment of Base Rent. The term “rent” shall mean Base Rent and
Additional Rent.

			
	1988	 	Southern California Chapter

of the Society of
Industrial
 and Office
Realtors, Inc.

3

 

     Section 4.02. Property Taxes.

     (a) Real Property Taxes. Tenant shall pay all real property taxes, on the Property
(including any fees, taxes or assessments against, or as a result of, any tenant improvements
installed on the Property by or for the benefit of Tenant) that are attributable to the Lease Term.
The limitations set forth in Paragraph 31 of Rider No. 1 attached hereto shall NOT apply to
any increase in such property taxes. Subject to Paragraph 4.02(c) and Section 4.08 below, such
payment shall be made at least ten (10) days prior to the delinquency date of the taxes. Within
such ten (10)-day period, Tenant shall furnish Landlord with satisfactory evidence that the real
property taxes have been paid. Landlord shall reimburse Tenant for any real property taxes paid by
Tenant covering any period of time prior to or after the Lease Term. If Tenant fails to pay the
real property taxes when due, Landlord may pay the taxes and Tenant shall reimburse Landlord for
the amount of such tax payment as Additional Rent.

     (b) Definition of “Real Property Tax.” “Real property tax” means: (i) any fee, license fee,
license tax, business license fee, commercial rental tax, levy, charge, assessment, penalty or tax
imposed by any taxing authority against the Property; (ii) any tax on the Landlord’s right to
receive, or the receipt of, rent or income from the Property or against Landlord’s business of
leasing the Property; (iii) any tax or charge for fire protection, streets, sidewalks, road
maintenance, refuse or other services provided to the Property by any governmental agency; (iv) any
tax imposed upon this transaction or based upon a re-assessment of the Property due to a change of
ownership, as defined by applicable law, or other transfer of all or part of Landlord’s interest in
the Property; and (v) any charge or fee replacing any tax previously included within the definition
of real property tax. “Real property tax” does not, however, include Landlord’s federal or state
income , gift, franchise, inheritance or estate taxes.

     (c) Joint Assessment. If the Property is not separately assessed, Landlord shall reasonably
determine Tenant’s share of the real property tax payable by Tenant under Paragraph 4.02(a) from
the assessor’s worksheets or other reasonably available information. Tenant shall pay such share
to Landlord within fifteen (15) days after receipt of Landlord’s written statement.

     (d) Personal Property Taxes.

          (i) Tenant shall pay all taxes charged against trade fixtures, furnishings, equipment
or any other personal property belonging to Tenant. Tenant shall try to have personal property
taxed separately from the Property.

          (ii) If any of Tenant’s personal property is taxed with the Property, Tenant shall pay
Landlord the taxes for the personal property within fifteen (15) days after Tenant receives a
written statement from Landlord for such personal property taxes.

          Section 4.03. Utilities. Tenant shall pay, directly to the appropriate supplier, the cost of
all natural gas, heat, light, power, sewer service, telephone, water, refuse disposal and other
utilities and services supplied to the Property. However, if any services or utilities are jointly
metered with other property, Landlord shall make a reasonable determination of Tenant’s
proportionate share of the cost of such utilities and services and Tenant shall pay such share to
Landlord within fifteen (15) days after receipt of Landlord’s written statement.

     Section 4.04. Insurance Policies.

     (a) Liability Insurance. During the Lease Term, Tenant shall maintain a policy of
commercial general liability insurance (sometimes known as broad form comprehensive
general liability insurance) insuring Tenant against liability for bodily injury,
property damage (including loss of use of property) and personal injury arising out of
the operation, use or occupancy of the Property. Tenant shall name Landlord and
property manager as an additional insured under such policy. The initial amount of
such insurance shall be One Million Dollars ($1,000,000) per occurrence and shall be
subject to periodic increase based upon inflation, increased liability awards,
recommendation of Landlord’s professional insurance advisers and other relevant
factors. The liability insurance obtained by Tenant under this Paragraph 4.04(a) shall
(i) be primary and non-contributing; (ii) contain cross-liability endorsements; and
(iii) insure Landlord against Tenant’s performance under Section 5.05, if the matters
giving rise to the indemnity under Section 5.05 result from the negligence of Tenant.
The amount and coverage of such insurance shall not limit Tenant’s liability nor
relieve Tenant of any other obligation under this Lease. Landlord and property manager
may also obtain comprehensive public liability insurance in an amount and with coverage
determined by Landlord insuring Landlord against liability arising out of.

			
	1988	 	Southern California Chapter

of the Society of
Industrial
 and Office
Realtors, Inc.

4

 

ownership, operation, use or occupancy of the Property. The policy obtained by Landlord and
property manager shall not be contributory and shall not provide primary insurance.

     (b) Property and Rental Income Insurance. During the Lease Term, Landlord shall maintain
policies of insurance covering loss of or damage to the Property in the full amount of its
replacement value. Such policy shall contain an Inflation Guard Endorsement and shall provide
protection against all perils included within the classification of fire, extended coverage,
vandalism, malicious mischief, special extended perils (all risk), sprinkler leakage and any other
perils which Landlord deems reasonably necessary. Landlord shall have the right to obtain flood and
earthquake insurance if required by any lender holding a security interest in the Property after
Landlord has attempted in a good faith and reasonable manner, to cause such Lender not to require
such insurance. Otherwise, Landlord shall have no right to obtain Earthquake Insurance. In no
event shall Tenant be responsible for any deductible on Earthquake Insurance. Landlord shall not
obtain insurance for Tenant’s fixtures or equipment or building improvements installed by Tenant on
the Property. During the Lease Term, Landlord shall also maintain a rental income insurance
policy, with loss payable to Landlord, in an amount equal to one year’s Base Rent, plus estimated
real property taxes and insurance premiums. Tenant shall be liable for the payment of any
deductible amount under Landlord’s or Tenant’s insurance policies maintained pursuant to this
Section 4.04, in an amount not to exceed Five Thousand Dollars ($5,000.00). Tenant shall not do or
permit anything to be done which invalidates any such insurance policies.

     (c) Payment
of Premiums. Subject to Section 4.08 below and, subject to the limitations set
forth in paragraph 31 of Rider No. 1 attached hereto, Tenant shall pay all premiums for the insurance
policies described in Paragraphs 4.04(a) (whether obtained by Landlord or Tenant), within fifteen
(15) days after Tenant’s receipt of a copy of the premium statement or other evidence of the amount
due, except Landlord shall pay all premiums for non-primary comprehensive public liability
insurance which Landlord elects to obtain as provided in Paragraph 4.04(a). For insurance policies
maintained by Landlord which cover improvements on the entire Project, Tenant shall pay Tenant’s
prorated share of the premiums, in accordance with the formula in Paragraph 4.05(e) for determining
Tenant’s share of Common Area costs. If insurance policies maintained by Landlord cover
improvements on real property other than the Project, Landlord shall deliver to Tenant a statement
of the premium applicable to the Property showing in reasonable detail how Tenant’s share of the
premium was computed. If the Lease Term expires before the expiration of an insurance policy
maintained by Landlord, Tenant shall be liable for Tenant’s prorated share of the insurance
premiums. Before the Commencement Date, Tenant shall deliver to Landlord a copy of any policy of
insurance, which Tenant is required to maintain under this Section 4.04. At least fifteen (15)
days prior to the expiration of any such policy, Tenant shall deliver to Landlord a renewal of such
policy. As an alternative to providing a policy of insurance, Tenant shall have the right to
provide Landlord a certificate of insurance, executed by an authorized officer of the insurance
company, showing that the insurance which Tenant is required to maintain under this Section 4.04 is
in full force and effect and containing such other information which Landlord reasonably requires.

     (d) General Insurance Provisions.

     (i) Any insurance which Tenant is required to maintain under this Lease shall include
a provision which requires the insurance carrier to give Landlord not less than thirty (30)
days’ written notice prior to any cancellation or adverse modification of such coverage.

     (ii) If Tenant fails to deliver any policy, certificate or renewal to Landlord
required under this Lease within the prescribed time period or if any such policy is
canceled or modified during the Lease Term without Landlord’s consent, Landlord may obtain
such insurance, in which case Tenant shall reimburse Landlord for the cost of such insurance
within fifteen (15) days after receipt of a statement that indicates the cost of such
insurance.

     (iii) Tenant shall maintain all insurance required under this Lease with companies holding a
“General Policy Rating” or A-12 or better, as set forth in the most current issue of “Best Key
Rating Guide”. Landlord and Tenant acknowledge the insurance markets are rapidly changing and that
insurance in the form and amounts described in this Section 4.04 may not be available in the
future. Tenant acknowledges that the insurance described in this Section 4.04 is for the primary
benefit of Landlord. If at any time during the Lease Term, Tenant is unable to

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
 and Office
Realtors, Inc.

5

 

maintain the insurance required under the Lease, Tenant shall nevertheless maintain
insurance coverage which is customary and commercially reasonable in the insurance industry
for Tenant’s type of business, as that coverage may change from time to time. Landlord
makes no representation as to the adequacy of such insurance to protect Landlord’s or
Tenant’s interests. Therefore, Tenant shall obtain any such additional property or
liability insurance which Tenant deems necessary to protect Landlord and Tenant.

          (iv) Unless prohibited under any applicable insurance policies
maintained, Landlord and Tenant each hereby waive any and all rights of recovery against the other,
or against the officers, employees, agents or representatives of the other, for loss of or damage
to its property or the property of others under its control, if such loss or damage is covered by
any insurance policy in force (whether or not described in this Lease) at the time of such loss or
damage. Upon obtaining the required policies of insurance, Landlord and Tenant shall give notice to
the insurance carriers of this mutual waiver of subrogation.

     Section 4.05. Common Areas; Use, Maintenance and Costs.

     (a) Common Areas. As used in this Lease, “Common Areas” shall mean all areas within the
Project which are available for the common use of tenants of the Project and which are not leased
or held for the exclusive use of Tenant or other tenants, including, but not limited to, parking
areas, driveways, sidewalks, loading areas, access roads, corridors, landscaping and planted areas.
Landlord, from time to time, may change the size, location, nature and use of any of the Common
Areas, convert Common Areas into leaseable areas, construct additional parking facilities
(including parking structures) in the Common Areas, and increase or decrease Common Area land
and/or facilities. Tenant acknowledges that such activities may result in inconvenience to Tenant.
Such activities and changes are permitted if they do not materially affect Tenant’s use of or
access to the Property.

     (b) Use of Common Areas. Tenant shall have the nonexclusive right (in common with other
tenants and all others to whom Landlord has granted or may grant such rights) to use the Common
Areas for the purposes intended, subject to such reasonable rules and regulations as Landlord may
establish from time to time. Tenant shall abide by such rules and regulations and shall use its
best effort to cause others who use the Common Areas with Tenant’s express or implied permission to
abide by Landlord’s rules and regulations. At any time, Landlord may close any Common Areas to
perform any acts in the Common Areas as, in Landlord’s judgment, are desirable to improve the
Project. Tenant shall not interfere with the rights of Landlord, other tenants or any other person
entitled to use the Common Areas.

     (c) Specific Provision re: Vehicle Parking. Tenant shall be entitled to use the number of
vehicle parking spaces in the Project allocated to Tenant in Section 1.11 of the Lease without
paying any additional rent. Tenant’s parking shall not be reserved and shall be limited to vehicles
no larger than standard size automobiles or pickup utility vehicles. Tenant shall not cause large
trucks or other large vehicles to be parked within the Project or on the adjacent public streets.
Temporary parking of large delivery vehicles in the Project may be permitted by the rules and
regulations established by Landlord. Vehicles shall be parked only in striped parking spaces and
not In driveways, loading areas or other locations not specifically designated for parking.
Handicapped spaces shall only be used by those legally permitted to use them. If Tenant parks more
vehicles in the parking area than the number set forth in Section 1.11 of this Lease, such conduct
shall be a material breach of this Lease. In addition to Landlord’s other remedies under the
Lease, Tenant shall pay a daily charge determined by Landlord for each such additional vehicle. See
Rider No 1, section 13 for additional provisions.

     (d) Maintenance of Common Areas. Landlord shall maintain the Common Areas in good order,
condition and repair and shall operate the Project, as a first-class
industrial/commercial real property development. Subject to the
limitations set forth in
Paragraph 31 or Rider No.1 attached hereto, Tenant shall pay Tenant’s pro rata share (as
determined below) of all costs incurred by Landlord for the operation and maintenance of the Common
Areas. Common Area costs include, but are not limited to, costs and expenses for the following:
gardening and landscaping; utilities, water and sewage charges; maintenance of signs (other than
tenants’ signs); premiums for liability, property damage, fire and other types of casualty
insurance on the Common Areas and worker’s compensation insurance; all property taxes and
assessments levied on or attributable to the Common Areas and all Common Area improvements; all
personal property taxes levied on

			
	1988	 	Southern California Chapter

of the Society of
Industrial
 and Office
Realtors, Inc.

6

 

or attributable to personal property used in connection with the Common Areas; straight-line
depreciation on personal property owned by Landlord which is consumed in the operation or
maintenance of the Common Areas; rental or lease payments paid by Landlord for rented or leased
personal property used in the operation or maintenance of the Common Areas; fees for required
licenses and permits; repairing, resurfacing, repaving, maintaining, painting, lighting, cleaning,
refuse removal, security and similar items; reserves for roof replacement exterior painting,
and replacement of HVAC units or major components and other appropriate reserves (the
“Reserves”, which shall be established initially at $.15 per square foot per year, which amount
may be subsequently increased by Landlord, subject to the limitations set forth in Paragraph 31 of
Rider No. 1 attached hereto) and a reasonable allowance to Landlord for Landlord’s
supervision of the Common Areas (tenant’s p ro rata share of such supervision allowance shall not
exceed four percent (4%) of Base Rent and all reimbursable expenses pursuant to Article 4 for the
applicable period). Landlord may cause any or all of such services to be provided by third parties
and the cost of such services shall be included in Common Area costs. Common Area costs shall not
include depreciation of real property, which forms part of the Common Areas.

     (e) Tenant’s Share and Payment. Tenant shall pay Tenant’s annual pro rata share of all Common
Area costs (prorated for any fractional month) upon written notice from Landlord that such costs
are due and payable, and in any event prior to delinquency. Tenant’s pro rata share shall be
calculated by dividing the square foot area of the Property, as set forth in Section 1.04 of the
Lease, by the aggregate square foot area of the Project which is leased or held for lease by
tenants, as of the date on which the computation is made. Tenant’s initial pro rata share is set
out in Paragraph 1.12(b). Any changes in the Common Area costs and/or the aggregate area of the
Project leased or held for lease during the Lease Term shall be effective on the first day of the
month after such change occurs. Landlord may, at Landlord’s election, estimate in advance and
charge to Tenant as Common Area costs, all real property taxes for which Tenant is liable under
Section 4.02 of the Lease, all insurance premiums for which Tenant is liable under Section 4.04 of
the Lease, all maintenance and repair costs for which Tenant is liable under Section 6.04 of the
Lease, and all other Common Area costs payable by Tenant hereunder. At Landlord’s election, such
statements of estimated Common Area costs shall be delivered monthly, quarterly or at any other
periodic intervals to be designated by Landlord. Landlord may adjust such estimates at any time
based upon Landlord’s experience and reasonable anticipation of costs. Such adjustments shall be
effective as of the next rent payment date after notice to Tenant. Within sixty (60) days after
the end of each calendar year of the Lease Term, Landlord shall deliver to Tenant a statement
prepared in accordance with generally accepted accounting principles setting forth, in reasonable
detail, the Common Area costs paid or incurred by Landlord during the preceding calendar year and
Tenant’s pro rata share. Upon receipt of such statement, there shall be an adjustment between
Landlord and Tenant, with payment to or credit given by Landlord (as the case may be) so that
Landlord shall receive the entire amount of Tenant’s share of such costs and expenses for such
period.

          (f) Audit. Tenant shall have the right to audit the operating expenses on an
annual basis and if such audit reveals an aggregate overstatement greater
than three
percent (3%), Landload shall reduce Tenant’s share of such operating expenses and shall
pay for the cost of such audit (such cost not to exceed One Thousand Dollars ($1,000)).

     Section 4.06. Late Charges. Tenant’s failure to pay rent promptly may cause Landlord to incur
unanticipated costs. The exact amount of such costs are impractical or extremely difficult to
ascertain. Such costs may include, but are not limited to, processing and accounting charges and
late charges which may be imposed on Landlord by any ground lease, mortgage or trust deed
encumbering the Property. Therefore, if Landlord does not receive any rent payment within ten (10)
days after it becomes due, Tenant shall pay Landlord a late charge equal to five percent (5%) of
the over due amount. The parties agree that such late charge represents a fair and reasonable
estimate of the costs Landlord will incur by reason of such late payment.

     Section 4.07. Interest on Past Due Obligations. Any amount owed by Tenant to Landlord which
is not paid when due shall bear interest at the rate often percent (10%) per annum from the due
date of such amount. However, interest shall not be payable on late charges to be paid by Tenant
under this Lease. The payment of interest on such amounts shall not excuse or cure any default by
Tenant under this Lease. If the interest rate specified in this Lease is higher than the rate
permitted by law, the interest rate is hereby decreased to the maximum legal interest rate
permitted by law.

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
and Office
Realtors, Inc.

7

 

     Section 4.08. Impounds for Insurance Premiums and Real Property Taxes. If
requested by any ground lessor or lender to whom Landlord has granted a security interest in
the Property, or if Tenant is more than ten (10) days late in the payment of rent more than once in
any consecutive twelve (12)-month period, Tenant shall pay Landlord a sum equal to one-twelfth
(1/12) of the annual real property taxes and insurance premiums payable by Tenant under this Lease,
together with each payment of Base Rent. Landlord shall hold such payments in a non-interest
bearing impound account. If unknown, Landlord shall reasonably estimate the amount of real
property taxes and insurance premiums when due. Tenant shall pay any deficiency of funds in the
impound account to Landlord upon written request. If Tenant defaults under this Lease, Landlord
may apply any funds in the impound account to any obligation then due under this Lease.

ARTICLE FIVE: USE OF PROPERTY

     Section 5.01. Permitted Uses. Tenant may use the Property only for the
Permitted Uses set forth in Section 1.06 above.

     Section 5.02. Manner of Use. Tenant shall not cause or permit the Property to be used in any
way which constitutes a violation of any law, ordinance, or governmental regulation or order, which
annoys or interferes with the rights of tenants of the Project, or which constitutes a nuisance or
waste. Tenant shall obtain and pay for all permits, including a Certificate of Occupancy, required
for Tenant’s occupancy of the Property and shall promptly take all actions necessary to comply with
all applicable statutes, ordinances, rules, regulations, orders and requirements regulating the use
by Tenant of the Property, including the Occupational Safety and Health Act.

     Section 5.03. Hazardous Materials. As used in this Lease, the term “Hazardous Material” means
any flammable items, explosives, radioactive materials, hazardous or toxic substances, material or
waste or related materials, including any substances defined as or included in the definition of
“hazardous substances”, “hazardous wastes”, “hazardous materials” or “toxic substances” now or
subsequently regulated under any applicable federal, state or local laws or regulations, including
without limitation petroleum-based products, paints, solvents, lead, cyanide, DDT, printing inks,
acids, pesticides, ammonia compounds and other chemical products, asbestos, PCBs and similar
compounds, and including any different products and materials which are subsequently found to have
adverse effects on the environment or the health and safety of persons. Tenant shall not cause or
permit any Hazardous Material to be generated, produced, brought upon, used, stored, treated or
disposed of in or about the Property by Tenant, its agents, employees, contractors, sub-lessees or
invitees without the prior written consent of Landlord, excepting those Hazardous Material items
listed in Exhibit D. Landlord shall be entitled to take into account such other factors or facts
as Landlord may reasonably determine to be relevant in determining whether to grant or withhold
consent to Tenant’s proposed activity with respect to Hazardous Material. In no event, however,
shall Landlord be required to consent to the installation or use of any storage tanks on the
Property.

     Section 5.04. Signs and Auctions. Tenant shall not place any signs on the Property
without Landlord’s prior written consent, except as provided in section 14 of Rider #No.
1. Tenant shall not conduct or permit any auctions or sheriff’s sales at the Property.

     Section 5.05. Indemnity. Tenant shall indemnify Landlord against and hold Landlord harmless
from any and all costs, claims or liability arising from: (a) Tenant’s use of the Property; (b) the
conduct of Tenant’s business or anything else done or permitted by Tenant to be done in or about
the Property, including any contamination of the Property or any other property resulting from the
presence or use of Hazardous Material caused or permitted by Tenant; (c) any breach or default in
the performance of Tenant’s obligations under this Lease; (d) any misrepresentation or breach of
warranty by Tenant under this Lease; or (e) other acts or omissions negligence or intentional
misconduct of Tenant. Tenant shall defend Landlord against any such cost, claim or liability at
Tenant’s expense with counsel reasonably acceptable to Landlord or, at Landlord’s election, Tenant
shall reimburse Landlord for any reasonable legal fees or costs incurred by Landlord in connection
with any such claim. As a material part of the consideration to Landlord, Tenant assumes all risk
of damage to property or injury to persons in or about the Property arising from any cause, and
Tenant hereby waives all claims in respect thereof against Landlord, except for any claim arising
out of Landlord’s negligence or willful misconduct.

			
	1988	 	Southern California Chapter

of the Society of
Industrial
 and Office
Realtors, Inc.

8

 

As used in this Section, the term “Tenant” shall include Tenant’s employees, agents’
contractors and invitees, if applicable.

     Section 5.06. Landlord’s Access. Landlord or its agents may enter the Property at all
reasonable times to show the Property to potential buyers, investors or tenants or other parties;
to do any other act or to inspect and conduct tests in order to monitor Tenant’s compliance with
all applicable environmental laws and all laws governing the presence and use of Hazardous
Material; or for any other purpose Landlord deems necessary. Landlord shall give Tenant 24 hours
prior notice of such entry, except in the case of an emergency.
During the last six (6) months
of the Lease Term or. any.extensions thereof, Landlord may place customary “For Sale” or “For
Lease” signs on the Property (Tenant’s leased premises), however Landlord may place “For Sale” or
“For Lease” signs on the Project at any time during the Lease Term or any extensions thereto.

     Section 5.07. Quiet Possession. If Tenant pays the rent and complies with all other terms
of this Lease, Tenant may occupy and enjoy the Property for the full Lease Term, subject to
the provisions of this Lease.

ARTICLE
SIX: CONDITION OF PROPERTY; MAINTENANCE. REPAIRS AND ALTERATIONS

     Section 6.01.
Existing Conditions. Subject to Section 2 of Rider No. 1. Tenant
accepts the Property in its condition as of the execution of the Lease, subject to all recorded
matters, laws, ordinances, and governmental regulations and orders. Except as provided herein,
Tenant acknowledges that neither Landlord nor any agent of Landlord has made any representation as
to the condition of the Property or the suitability of the Property for Tenant’s intended use.
Tenant represents and warrants that Tenant has made its own inspection of and inquiry regarding the
condition of the Property and is not relying on any representations of Landlord or any Broker with
respect thereto.

     Section 6.02. Exemption of Landlord from Liability. Subject to .Section 2 of
Rider
No,1, Landlord shall not be liable for any damage or injury to the person, business
(or any loss of income therefrom), goods, wares, merchandise or other property of Tenant, Tenant’s
employees, invitees, customers or any other person in or about the Property, whether such damage or
injury is caused by or results from: (a) fire, steam, electricity, water, gas or rain; (b) the
breakage, leakage, obstruction or other defects of pipes, sprinklers, wires, appliances, plumbing,
air conditioning or lighting fixtures or any other cause; (c) conditions arising in or about the
Property or upon other portions of the Project, or from other sources or places; or (d) any act or
omission of any other tenant of the Project. Landlord shall not be liable for any such damage or
injury even though the cause of or the means of repairing such damage or injury are not accessible
to Tenant. The provisions of this Section 6.02 shall not, however, exempt Landlord from liability
for Landlord’s gross negligence or willful misconduct.

     Section 6.03. Landlord’s Obligations.

     (a) Except as provided in Article Seven (Damage or Destruction) and Article Eight
(Condemnation), Landlord shall keep the following in good order, condition and
repair, at no additional cost to Tenant in.excess of the Reserves charged pursuant to
Section 4,05.(d) below: the foundations, exterior walls and roof and other structural
elements of the Property (including painting the exterior surface of the exterior walls of the
Property not more often than once every five (5) years, if necessary) and all components of
electrical, mechanical, plumbing, heating and air conditioning systems and facilities located in
the Property which are concealed or used in common by tenants of the Project. However, Landlord
shall not be obligated to maintain or repair windows (but shall repair any water leaks in window
seals and shall wash all exterior windows at lease twice per year), doors, plate glass or the
interior surfaces of exterior walls. Landlord shall make repairs under this Section 6.03 within a
reasonable time after receipt of written notice from Tenant of the need for such repairs. If any
portion of the Property or any system or equipment in the Property which Landlord is obligated to
repair cannot be fully repaired or restored, Landlord shall promptly replace such portion of the
Property or system or equipment in the Property, regardless of whether the benefit of such
replacement extends beyond the Lease Term; but if the benefit or useful life of such replacement
extends beyond the Lease Term (as such term may be extended by exercise of any options), the useful
life of such replacement shall be prorated over the remaining portion of the Lease Term (as
extended), and Tenant shall be liable only for that portion of the cost which is applicable to the
Lease Term (as extended).

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
and Office
Realtors, Inc.

9

 

     (b) Tenant shall pay or reimburse Landlord for all costs Landlord incurs under
Paragraph 6.03(a) above as Common Area costs as provided for in Section 4.05 of the Lease. Tenant
waives the benefit of any statute in effect now or in the future which might give Tenant the right
to make repairs at Landlord’s expense or to terminate this Lease due to Landlord’s failure to
keep the Property in good order, condition and repair.

Section 6.04. Tenant’s Obligations.

     (a) Except as provided in Section 6.03, Article Seven (Damage or Destruction) and Article
Eight (Condemnation), Tenant shall keep all non-structural interior portions of the Property
(including systems and equipment) in good order, condition and repair (including interior
repainting and refinishing, as needed). If any portion of the Property or any system or equipment
in the Property which Tenant is obligated to repair cannot be fully repaired or restored, Landlord
shall promptly replace such portion of the Property or system or equipment in the Property,
regardless of whether the benefit of such replacement extends beyond the Lease Term; but if the
benefit or useful life of such replacement extends beyond the Lease Term (as such term may
be extended by exercise of any options), the useful life of such replacement shall be prorated over
the remaining portion of the Lease Term (as if extended), and Tenant shall be liable only for that
portion of the cost which is applicable to the Lease Term (as if extended). Tenant shall maintain a
preventive maintenance contract providing for the regular inspection and maintenance of the heating
and air conditioning system by a licensed heating and air conditioning contractor, unless Landlord
maintains such equipment under Section 6.03 above. If any part of the Property or the Project is
damaged by any act or omission of Tenant, Tenant shall pay Landlord the cost of repairing or
replacing such damaged property, whether or not Landlord would otherwise be obligated to pay the
cost of maintaining or repairing such property. It is the intention of Landlord and Tenant that at
all times Tenant shall maintain the portions of the Property which Tenant is obligated to maintain
in an attractive, first- class and fully operative condition.

     (b) Tenant shall fulfill all of Tenant’s obligations under this Section 6.04 at Tenant’s sole
expense. If Tenant fails to maintain, repair or replace the Property as required by this Section
6.04, Landlord may, upon ten (10) days’ prior notice to Tenant (except that no notice shall be
required in the case of an emergency), enter the Property and perform such maintenance or repair
(including replacement, as needed) on behalf of Tenant. In such case, Tenant shall reimburse
Landlord for all costs reasonably incurred in performing such maintenance or repair immediately
upon demand.

     Section 6.05. Alterations, Additions, and Improvements.

     (a) Except for the Tenant Improvements identified On Exhibit C attached. hereto and
subject to section 3 of rider No. 1,Tenant shall not make any alterations, additions, or
improvements to the Property without Landlord’s prior written consent, except for non- structural
alterations which do not exceed Ten Thousand Dollars ($10,000) in cost cumulatively over the Lease
Term and which are not visible from the outside of any building of which the Property is part.
Landlord may require Tenant to provide demolition and/or lien and completion bonds in form and
amount satisfactory to Landlord. Tenant shall promptly remove any alterations, additions, or
improvements constructed in violation of this Paragraph 6.05(a) upon Landlord’s written request.
Further, unless the Landlord agrees not to requires removal at the time Landlord grants consent,
Landlord may require that all alterations, additions or improvements be removed by Tenant and the
Property restored to their condition prior to such alteration, addition or improvement, at no cost
to Landlord, upon the expiration or earlier termination of this Lease. Except with respect to
improvements so required by Landlord to be removed, all improvements will remain in the Premises.
If consent is not required. Tenant has the right to request that Landlord determine the removal
requirements at such time as Tenant submits a written request to Landlord. NOTE: All initial
Tenant Improvements as identified on the attached Exhibit C, shall remain in the Property upon the
expiration or termination of this Lease. All alterations, additions, and improvements shall be done
in a good and workmanlike manner, in conformity with all-applicable laws and regulations, and by a
contractor approved by Landlord. Upon completion of any such work, Tenant shall provide Landlord
with “as built” plans, copies of all construction contracts, and proof of payment for all labor and
materials.

     (b) Tenant shall pay when due all claims for labor and material furnished to the Property.
Tenant shall give Landlord at least twenty (20) days’ prior written notice of the commencement of
any work on the Property, regardless of whether Landlord’s consent to

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
and Office
Realtors, Inc.

10

 

such work is required. Landlord may elect to record and post notices of non-responsibility
on the Property.

     Section 6.06. Condition upon Termination. Upon the expiration or earlier termination of the
Lease, Tenant shall surrender the Property to Landlord, broom clean and in the same condition as
received (except with respect to the clean room as provided in Section 2 of Rider No. 2 attached
hereto) except for ordinary wear and tear, casualty damage and condemnation, that Tenant was not
otherwise obligated to remedy under any provision of this Lease. However, Tenant shall not be
obligated to repair any damage which Landlord is required to repair under Section 6.03 or under
Article Seven (Damage or Destruction). In addition, unless Landlord hereafter specifically agrees
otherwise, in writing, Landlord may require Tenant to remove any alterations, additions or
improvements made without Landlord’s consent or in violation of Section 6.05 (a) immediately prior
to the expiration of the Lease and to restore the Property to its prior condition, all at Tenant’s
expense. All alterations, additions and improvements which Landlord has not required Tenant to
remove shall become Landlord’s property and shall be surrendered to Landlord upon the expiration or
earlier termination of the Lease, except that Tenant may remove any of Tenant’s machinery or
equipment which can be removed without material damage to the Property. Tenant shall repair, at
Tenant’s expense, any damage to the Property caused by the removal of any such machinery or
equipment. In no event, however, shall Tenant remove any of the following materials or equipment
(which shall be deemed Landlord’s property) without Landlord’s prior written consent: any power
wiring or power panels; lighting or lighting fixtures; wall coverings; drapes, blinds or other
window coverings; carpets or other floor coverings; heaters, air conditioners or any other heating
or air conditioning equipment; fencing or security gates; or other similar building operating
equipment and decorations.

ARTICLE SEVEN: DAMAGE OR DESTRUCTION 

     Section
7.01. Partial Damage to Property.

     (a) Tenant shall notify Landlord in writing immediately upon the occurrence of any damage to
the Property. If the Property is only partially damaged (i.e., less than fifty percent (50%) of the
Property is untenantable as a result of such damage or less than fifty percent (50%) of Tenant’s
operations are materially impaired) and if the proceeds received by Landlord from the insurance
policies described in Paragraph 4.04(b) are sufficient to pay for the necessary repairs, this Lease
shall remain in effect and Landlord shall repair the damage as soon as reasonably possible.
Except as otherwise set forth in this lease,
Landlord may elect (but is not required) to repair any damage to Tenant’s fixtures,
equipment, or improvements.

     (b) If the insurance proceeds received by Landlord are not sufficient to pay the entire cost
of repair, or if the cause of the damage is not covered by the insurance policies which Landlord
maintains under Paragraph 4.04(b), Landlord may elect either to (i) repair the damage as soon as
reasonably possible, in which case this Lease shall remain in full force and effect, or (ii)
terminate this Lease as of the date the damage occurred. Landlord shall notify Tenant within thirty
(30) days after receipt of notice of the occurrence of the damage whether Landlord elects to repair
the damage or terminate the Lease. If Landlord elects to repair the damage, Tenant shall pay
Landlord the “deductible amount” (if any) under Landlord’s insurance policies, not to exceed
$10,000, and, if the damage was due to an act or omission of Tenant, or Tenant’s employees, agents,
contractors or invitees, the difference between the actual cost of repair and any insurance
proceeds received by Landlord. If Landlord elects to terminate the Lease, Tenant may elect to
continue this Lease in full force and effect, in which case Tenant shall repair any damage to the
Property and any building in which the Property is located. Tenant shall pay the cost of such
repairs, except that upon satisfactory completion of such repairs, Landlord shall deliver to Tenant
any insurance proceeds received by Landlord for the damage repaired by Tenant. Tenant shall give
Landlord written notice of such election within ten (10) days after receiving Landlord’s
termination notice.

     (c) If the damage to the Property occurs during the last six (6) months of the Lease Term and
such damage will require more than thirty (30) days to repair, either Landlord or Tenant may elect
to terminate this Lease as of the date the damage occurred, regardless of the sufficiency of any
insurance proceeds. The party electing to terminate this Lease shall give written notification to
the other party of such election within thirty (30) days after Tenant’s notice to Landlord of the
occurrence of the damage.

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
and Office
Realtors, Inc.

11

 

     Section 7.02. Substantial or Total Destruction. If the Property is substantially or
totally destroyed by any cause whatsoever (i.e., the damage to the Property is greater than partial
damage as described in Section 7.01), and regardless of whether Landlord receives any insurance
proceeds, this Lease shall terminate as of the date the destruction occurred. Notwithstanding the
preceding sentence, if the Property can be rebuilt within six (6) months after the date of
destruction, Landlord may elect to rebuild the Property at Landlord’s own expense, in which case
this Lease shall remain in full force and effect. Landlord shall notify Tenant of such election
within thirty (30) days after Tenant’s notice of the occurrence of total or substantial
destruction. If Landlord so elects. Landlord shall rebuild the Property at Landlord’s sole expense,
except that if the destruction was caused by an act or omission of Tenant, Tenant shall pay
Landlord the difference between the actual cost of rebuilding and any insurance proceeds received
by Landlord.

     Section 7.03. Temporary Reduction of Rent. If the Property is destroyed or damaged and
Landlord or Tenant repairs or restores the Property pursuant to the provisions of this Article
Seven, any rent payable during the period of such damage, repair and/or restoration shall be
reduced according to the degree, if any, to which Tenant’s use of the Property is impaired.
However, the reduction shall not exceed the sum of one year’s payment of Base Rent, insurance
premiums and real property taxes. Except for such possible reduction in Base Rent, insurance
premiums and real property taxes, and except for damages caused by the gross negligence or
intentional misconduct of Landlord or its agents, employees and contractors, Tenant shall not be
entitled to any compensation, reduction, or reimbursement from Landlord as a result of any damage,
destruction, repair, or restoration of or to the Property.

     Section 7.04. Waiver. Tenant waives the protection of any statute, code or judicial decision
which grants a tenant the right to terminate a lease in the event of the substantial or total
destruction of the leased property. Tenant agrees that the provisions of Section 7.02 above shall
govern the rights and obligations of Landlord and Tenant in the event of any substantial or total
destruction to the Property.

ARTICLE EIGHT: CONDEMNATION

     If all or any portion of the Property is taken under the power of eminent domain or sold
under the threat of that power (all of which are called “Condemnation”), this Lease shall terminate
as to the part taken or sold on the date the condemning authority takes title or possession,
whichever occurs first. If more than twenty percent (20%) of the floor area of the building in
which the Property is located, or which is located on the Property, is taken, or if more than
nineteen (19) parking spaces allocated to Tenant’s use are taken, then either Landlord or Tenant
may terminate this Lease as of the date the condemning authority takes title or possession, by
delivering written notice to the other within ten (10) days after receipt of written notice of such
taking (or in the absence of such notice, within ten (10) days after the condemning authority takes
title or possession). If neither Landlord nor Tenant terminates this Lease, this Lease shall remain
in effect as to the portion of the Property not taken, except that the Base Rent and Additional
Rent shall be reduced in proportion to the reduction in the floor area of the Property. Any
Condemnation award or payment shall be distributed in the following order: (a) first, to any ground
lessor, mortgagee or beneficiary under a deed of trust encumbering the Property, the amount of its
interest in the Property; (b) second, to Tenant, only the amount of any award specifically
designated for loss of or damage to Tenant’s trade fixtures or removable personal property; and (c)
third, to Landlord, the remainder of such award, whether as compensation for reduction in the value
of the leasehold, the taking of the fee, or otherwise. If this Lease is not terminated, Landlord
shall repair any damage to the Property caused by the Condemnation, except that Landlord shall not
be obligated to repair any damage for which Tenant has been reimbursed by the condemning authority.
If the severance damages received by Landlord are not sufficient to pay for such repair, Landlord
shall have the right to either terminate this Lease or make such repair at Landlord’s expense.

ARTICLE NINE: ASSIGNMENT AND SUBLETTING

     Section 9.01. Landlord’s Consent Required. No portion of the Property or of Tenant’s
interest in this Lease may be acquired by any other person or entity, whether by sale, assignment,
mortgage, sublease, transfer, operation of law, or act of Tenant, without Landlord’s prior written
consent, except as provided in Section 9.02 below. Landlord has the right to grant or withhold its
consent as provided in Section 9.05 below. Any attempted transfer without consent shall be void and
shall constitute a non-curable breach

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
and Office
Realtors, Inc.

12

 

of this Lease. If Tenant is a partnership, any cumulative transfer of more than twenty
percent (20%) of the partnership interests shall require Landlord’s consent.

     Section 9.02. Tenant Affiliate. Tenant may assign this Lease or sublease all or any portion of
the Property, without Landlord’s consent, to any corporation which controls, is controlled by or is
under common control with Tenant, or to any corporation resulting from the merger of or
consolidation with Tenant or to any person or entity who acquires all or substantially all of
Tenant’s stock or assets (“Tena nt’s Affiliate”), provided that the net worth of the acquiror, as
established to Landlord’s reasonable satisfaction, shall not be less than the net worth of Tenant
as of the date hereof, and provided further that no such assignment may be made prior to the
assignee’s execution of a lease assumption agreement in such form as Landlord may reasonably
require, and provided further that there is no existing default by Tenant beyond all applicable
cure periods. In such case, any
Tenant’s Affiliate shall assume in writing all of Tenant’s obligations under this Lease.

     Section 9.03. No Release of Tenant. No transfer permitted by this Article Nine, whether with
or without Landlord’s consent, shall release Tenant or change Tenant’s primary liability to pay the
rent and to perform all other obligations of Tenant under this Lease. Landlord’s acceptance of rent
from any other person is not a waiver of any provision of this Article Nine. Consent to one
transfer is not a consent to any subsequent transfer. If Tenant’s transferee defaults under this
Lease, Landlord may proceed directly against Tenant without pursuing remedies against the
transferee. Landlord may consent to subsequent assignments or modifications of this Lease by
Tenant’s transferee, without notifying Tenant or obtaining its consent. Such action shall not
relieve Tenant’s liability under this Lease.

     Section 9.04. Offer to Terminate. If Tenant desires to assign the Lease or sublease the
Property, Tenant shall have the right to offer, in writing, to terminate the Lease as of a date
specified in the offer. If Landlord elects in writing to accept the offer to terminate within
twenty (20) days after notice of the offer, the Lease shall terminate as of the date specified and
all the terms and provisions of the Lease governing termination shall apply. If Landlord does not
so elect, the Lease shall continue in effect until otherwise terminated and the provisions of
Section 9.05 with respect to any proposed transfer shall continue to apply.

     Section 9.05. Landlord’s Consent.

     (a) Tenant’s request for consent to any transfer described in Section 9.01 shall set forth in
writing the details of the proposed transfer, including the name, business and financial condition
of the prospective transferee, financial details of the proposed transfer (e.g., the term of and
the rent and security deposit payable under any proposed assignment or sublease), and any other
information Landlord deems relevant. Landlord shall have the right to withhold consent, if
reasonable, or to grant consent, based on the following factors: (i) the business of the proposed
assignee or subtenant and the proposed use of the Property; (ii) the net worth and financial
reputation of the proposed assignee or subtenant; (iii) Tenant’s compliance with all of its
obligations under the Lease; and (iv) such other factors as Landlord may reasonably deem relevant.
If Landlord objects to a proposed assignment solely because of the net worth and/or financial
reputation of the proposed assignee, Tenant may nonetheless sublease (but not assign), all or a
portion of the Property to the proposed transferee, but only on the other terms of the proposed
transfer.

     (b) If Tenant assigns or subleases, the following shall apply:

     (i) Tenant shall pay to Landlord as Additional Rent under the Lease the Landlord’s
Share (stated in Section 1.13) of the Profit (defined below) on such transaction as and when
received by Tenant, unless Landlord gives written notice to Tenant and the assignee or
subtenant that Landlord’s Share shall be paid by the assignee or subtenant to Landlord
directly. The “Profit” means (A) all amounts paid to Tenant for such assignment or sublease
(as opposed to for other Tenant assets), including “key” money, monthly rent in excess of
the monthly rent payable under the Lease, and all fees and other consideration paid for the
assignment or sublease, including fees under any collateral agreements, less (B) costs and
expenses directly incurred by Tenant in connection with the execution and performance of
such assignment or sublease for real estate broker’s commissions reasonable, legal fees not
to exceed $2,000.00 and costs of renovation or construction of tenant improvements required
under such assignment or sublease. Tenant is entitled to recover such costs and expenses
before Tenant is obligated to pay the Landlord’s

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
 and Office
Realtors, Inc.

13

 

Share to Landlord. The Profit in the case of a sublease of less than all the
Property is the rent allocable to the subleased space as a percentage on a square footage
basis.

     (ii) Tenant shall provide Landlord a written statement certifying all amounts to be
paid from any assignment or sublease of the Property within thirty (30) days after the
transaction documentation is signed, and Landlord may inspect Tenant’s books and records to
verify the accuracy of such statement. On written request, Tenant shall promptly furnish to
Landlord copies of all the transaction documentation, all of which shall be certified by
Tenant to be complete, true and correct. Landlord’s receipt of Landlord’s Share shall not be
a consent to any further assignment or subletting. The breach of Tenant’s obligation under
this Paragraph 9.05(b) shall be a material default of the Lease.

     Section 9.06. No Merger. No merger shall result from Tenant’s sublease of the Property under
this Article Nine, Tenant’s surrender of this Lease or the termination of this Lease in any other
manner. In any such event, Landlord may terminate any or all subtenancies or succeed to the
interest of Tenant as sub-landlord under any or all subtenancies.

ARTICLE
TEN: DEFAULTS; REMEDIES

     Section 10.01. Covenants and Conditions. Tenant’s performance of each of
Tenant’s obligations under this Lease is a condition as well as a covenant. Tenant’s right to
continue in possession of the Property is conditioned upon such performance. Time is of the essence
in the performance of all covenants and conditions.

     Section 10.02. Defaults. Tenant shall be in material default under this Lease:

     (a) If Tenant abandons the Property or if Tenant’s vacation of the Property results in
the cancellation of any insurance described in Section 4.04;

     (b) If Tenant fails to pay rent or any other charge for a period of 5 days after written
notice from Landlord which 5 day notice shall satisfy all statutory notice requirements.

     (c) If Tenant fails to perform any of Tenant’s non-monetary obligations under this Lease for a
period of thirty (30) days after written notice from Landlord; provided that if more than thirty
(30) days are required to complete such performance, Tenant shall not be in default if Tenant
commences such performance within the thirty (30)-day period and thereafter diligently pursues its
completion. However, Landlord shall not be required to give such notice if Tenant’s failure to
perform constitutes a non-curable breach of this Lease. The notice required by this Paragraph is
intended to satisfy any and all notice requirements imposed by law on Landlord and is not in
addition to any such requirement.

     (d) (i) If Tenant makes a general assignment or general arrangement for the benefit of
creditors; (ii) if a petition for adjudication of bankruptcy or for reorganization or rearrangement
is filed by or against Tenant and is not dismissed within thirty (30) days; (iii) if a trustee or
receiver is appointed to take possession of substantially all of Tenant’s assets located at the
Property or of Tenant’s interest in this Lease and possession is not restored to Tenant within
thirty (30) days; or (iv) if substantially all of Tenant’s assets located at the Property or of
Tenant’s interest in this Lease is subjected to attachment, execution or other judicial seizure
which is not discharged within thirty (30) days. If a court of competent jurisdiction determines
that any of the acts described in this subparagraph (d) is not a default under this Lease, and a
trustee is appointed to take possession (or if Tenant remains a debtor in possession) and such
trustee or Tenant transfers Tenant’s interest hereunder, then Landlord shall receive, as Additional
Rent, the excess, if any, of the rent (or any other consideration) paid in connection with such
assignment or sublease over the rent payable by Tenant under this Lease.

     (e)If any guarantor of the Lease revokes or otherwise terminates, or purports to
revoke or otherwise terminate, any guaranty of ail or any portion of Tenant’s obligations under the
Lease. Unless otherwise expressly provided, no guaranty of the Lease is revocable.

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
and Office
Realtors, Inc.

14

 

     Section 10.03. Remedies. On the occurrence of any material default by
Tenant, Landlord may, at any time thereafter, with or without notice or demand and without limiting
Landlord in the exercise of any right or remedy which Landlord may have:

     (a) Terminate Tenant’s right to possession of the Property by any lawful means, in which case
this Lease shall terminate and Tenant shall immediately surrender possession of the Property to
Landlord. In such event, Landlord shall be entitled to recover from Tenant all damages incurred by
Landlord by reason of Tenant’s default, including (i) the worth at the time of the award of the
unpaid Base Rent, Additional Rent and other charges which Landlord had earned at the time of the
termination; (ii) the worth at the time of the award of the amount by which the unpaid Base Rent,
Additional Rent and other charges which Landlord would have earned after termination until the time
of the award exceeds the amount of such rental loss that Tenant proves Landlord could have
reasonably avoided; (iii) the worth at the time of the award of the amount by which the unpaid Base
Rent, Additional Rent and other charges which Tenant would have paid for the balance of the Lease
Term after the time of award exceeds the amount of such rental loss that Tenant proves Landlord
could have reasonably avoided; and (iv) any other amount necessary to compensate Landlord for all
the detriment proximately caused by Tenant’s failure to perform its obligations under the Lease or
which in the ordinary course of things would be likely to result therefrom, including, but not
limited to, any costs or expenses Landlord incurs in maintaining or preserving the Property after
such default, the cost of recovering possession of the Property, expenses of reletting, including
necessary renovation or alteration of the Property, Landlord’s reasonable attorneys’ fees incurred
in connection therewith, and any real estate commission paid or payable. As used in subparts (i)
and (ii) above, the “worth at the time of the award” is computed by allowing interest on unpaid
amounts at the rate of fifteen percent (15%) per annum, or such lesser amount as may then be the
maximum lawful rate. As used in subpart (iii) above, the “worth at the time of the award” is
computed by discounting such amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of the award, plus one percent (1 %). If Tenant has abandoned the Property,
Landlord shall have the option of (i) retaking possession of the Property and Recovering from
Tenant the amount specified in this Paragraph 10.03(a), or (ii) proceeding under Paragraph
10.03(b);

     (b) Maintain Tenant’s right to possession, in which case this Lease shall continue in effect
whether or not Tenant has abandoned the Property. In such event, Landlord shall be entitled to
enforce all of Landlord’s rights and remedies under this Lease, including the right to recover the
rent as it becomes due;

     (c) Pursue any other remedy now or hereafter available to Landlord under the laws or judicial
decisions of the state in which the Property is located.

     Section 10.04. Repayment of “Free” Rent. If this Lease provides for a
postponement of any monthly rental payments, a period of “free” rent or other rent concession, such
postponed rent or “free” rent is called the “Abated Rent”. Tenant shall be credited with having
paid all of the Abated Rent on the expiration of the Lease Term only if Tenant has fully,
faithfully, and punctually performed all of Tenant’s obligations hereunder, including the payment
of all rent (other than the Abated Rent) and all other monetary obligations and the surrender of
the Property in the physical condition required by this Lease. Tenant acknowledges that its right
to receive credit for the Abated Rent is absolutely conditioned upon Tenant’s full, faithful and
punctual performance of Its obligations under this Lease. If Tenant defaults and does not cure
within any applicable grace period, the Abated Rent shall immediately become due and payable in
full and this Lease shall be enforced as if there were no such rent abatement or other rent
concession. In such case Abated Rent shall be calculated based on the full initial rent payable
under this Lease.

     Section 10.05. Automatic Termination. Notwithstanding any other term or
provision hereof to the contrary, the Lease shall terminate on the occurrence of any act which
affirms the Landlord’s intention to terminate the Lease as provided in Section 10.03 hereof,
including the filing of an unlawful retainer action against Tenant.
On such termination, Landlord’s
damages for default shall include all costs and fees, including reasonable attorneys’ fees that
Landlord incurs in connection with the filing, commencement, pursuing and/or defending of any
action in any bankruptcy court or other court with respect to the Lease; the obtaining of relief
from any stay in bankruptcy restraining any action to evict Tenant; or the pursuing of any action
with respect to Landlord’s right to possession of the Property. All such damages suffered (apart
from Base Rent and other rent payable hereunder) shall constitute pecuniary damages which must be

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
and Office
Realtors, Inc.

15

 

reimbursed to Landlord prior to assumption of the Lease by Tenant or any successor to
Tenant in any bankruptcy or other proceeding.

     Section 10.06. Cumulative Remedies. Landlord’s exercise of any right or
remedy shall not prevent it from exercising any other right or remedy.

ARTICLE ELEVEN: PROTECTION OF LENDERS

     Section 11.01. Subordination. Landlord shall have the right to subordinate
this Lease to any ground lease, deed of trust or mortgage encumbering the Property, any advances
made on the security thereof and any renewals, modifications, consolidations, replacements or
extensions thereof, whenever made or recorded. Tenant shall cooperate, at no cost to
Tenant, with Landlord and any lender which is acquiring a security interest in the Property or
the Lease. Tenant shall execute such further documents and assurances as such lender may reasonably
require, provided that Tenant’s obligations under this Lease shall not be increased in any material
way (the performance of ministerial acts shall not be
deemed material), and Tenant shall not be deprived of its rights
under this Lease, Landlord
shall use commercially reasonable efforts to secure and deliver to Tenant a subordination,
non-disturbance and attornment agreement to be executed by Tenant and Landlord’s mortgagee.
Tenant’s right to quiet possession of the Property during the Lease Term shall not be disturbed if
Tenant pays the rent and performs all of Tenant’s obligations under this Lease and is not otherwise
in default. If any ground lessor, beneficiary or mortgagee elects to have this Lease prior to the
lien of its ground lease, deed of trust or mortgage and gives written notice thereof to Tenant,
this Lease shall be deemed prior to such ground lease, deed of trust or mortgage whether this Lease
is dated prior or subsequent to the date of said ground lease, deed of trust or mortgage or the
date of recording thereof.

     Section 11.02. Attornment. If Landlord’s interest in the Property is acquired
by any ground lessor, beneficiary under a deed of trust, mortgagee, or purchaser at a foreclosure
sale, Tenant shall attorn to the transferee of or successor to Landlord’s interest in the Property
and recognize such transferee or successor as Landlord under this Lease. Tenant waives the
protection of any statute or rule of law which gives or purports to give Tenant any right to
terminate this Lease or surrender possession of the Property upon the transfer of Landlord’s
interest.

     Section 11.03. Signing of Documents. Tenant shall sign and deliver, at no
cost to Tenant, any instrument or documents necessary or appropriate to evidence any such
attornment or subordination or agreement to do so. If Tenant fails to do so within ten (10) days
after written request, Tenant hereby makes, constitutes and irrevocably appoints Landlord, or any
transferee or successor of Landlord, the attorney-in-fact of Tenant to execute and deliver any such
instrument or document.

     Section 11.04. Estoppel Certificates.

     (a) Upon Landlord’s written request, Tenant shall execute, acknowledge and deliver to Landlord
a written statement certifying: (i) that none of the terms or provisions of this Lease have been
changed (or if they have been changed, stating how they have been changed); (ii) that this Lease
has not been canceled or terminated; (iii) the last date of payment of the Base Rent and other
charges and the time period covered by such payment; (iv) that Landlord is not in default under
this Lease (or, if Landlord is claimed to be in default, stating why); and (v) such other
representations or information with respect to Tenant or the Lease as Landlord may reasonably
request or which any prospective purchaser or encumbrancer of the Property may require. Tenant
shall deliver such statement to Landlord within ten (10) days after its receipt of
Landlord’s written request. Landlord may give any such statement by Tenant to any
prospective purchaser or encumbrancer of the Property. Such purchaser or encumbrancer may rely
conclusively upon such statement as true and correct.

     (b) If Tenant does not deliver such statement to Landlord within such ten (10)-day period,
Landlord, and any prospective purchaser or encumbrancer, may conclusively presume and rely upon the
following facts: (i) that the terms and provisions of this Lease have not been changed except as
otherwise represented by Landlord; (ii) that this Lease has not been canceled or terminated except
as otherwise represented by Landlord; (iii) that not more than one month’s Base Rent or other
charges have been paid in advance; and (iv) that Landlord is not in default under the Lease. In
such event, Tenant shall be estopped from denying the truth of such facts.

     Section 11.05. Tenant’s Financial Condition. Within ten (10) days after
written request from Landlord, but in no event more than once in
any calendar year.

			
	1988	 	Southern California Chapter

of the Society of
Industrial
 and Office
Realtors, Inc.

16

 

Tenant shall deliver to Landlord such financial statements regularly prepared by Tenant (or
any assignee or sub-tenant) to verify the net worth of Tenant or any assignee, subtenant, or
guarantor of Tenant. In addition, Tenant shall deliver to any lender designated by Landlord any
financial statements required by such lender to facilitate the financing or refinancing of the
Property. Tenant represents and warrants to Landlord that each such financial statement is a true
and accurate statement as of the date of such statement. All financial statements shall be
confidential and shall be used only for the purposes set forth in this Lease.

ARTICLE TWELVE: LEGAL COSTS

     Section 12.01. Legal Proceedings. If Tenant or Landlord shall be in breach or
default under this Lease, such party (the “Defaulting Party”) shall reimburse the other party (the
“Nondefaulting Party”) upon demand for any costs or expenses that the Nondefaulting Party incurs in
connection with any breach or default of the Defaulting Party under this Lease, whether or not suit
is commenced or judgment entered. Such costs shall include legal fees and costs incurred for the
negotiation of a settlement, enforcement of rights or otherwise. Furthermore, if any action for
breach of or to enforce the provisions of this Lease is commenced, the court in such action shall
award to the party in whose favor a judgment is entered, a reasonable sum as attorneys’ fees and
costs. The losing party in such action shall pay such attorneys’ fees and costs. Except to the
extent Landlord is found liable in such claim or action, Tenant shall also indemnify Landlord
against and hold Landlord harmless from all costs, expenses, demands and liability Landlord may
incur if Landlord becomes or is made a party to any claim or action (a) instituted by Tenant
against any third party, or by any third party against Tenant, or by or against any person holding
any interest under or using the Property by license of or agreement with Tenant; (b) for
foreclosure of any lien for labor or material furnished to or for Tenant or such other person; (c)
otherwise arising out of or resulting from any act or transaction of Tenant or such other person;
or (d) necessary to protect Landlord’s interest under this Lease in a bankruptcy proceeding, or
other proceeding under Title 11 of the United States Code, as amended. Except to the extent
Landlord is found liable in such claim or action, Tenant shall defend Landlord against any such
claim or action at Tenant’s expense with counsel reasonably acceptable to Landlord or, at
Landlord’s election, Tenant shall reimburse Landlord for any legal fees or costs Landlord incurs in
any such claim or action.

     Section 12.02. Landlord’s Consent. Tenant shall pay Landlord’s reasonable
attorneys’ fees incurred in connection with Tenant’s request for Landlord’s consent under Article
Nine (Assignment and Subletting), or in connection with any other act which Tenant proposes to do
and which requires Landlord’s consent. Landlord agrees to place a cap on said reasonable attorney’s
fees at $2,500.00 per occurrence, unless Tenant’s request is of such a nature to substantially
exceed $2,500.00 in reasonable attorney’s fees; at which time Tenant shall be given prior notice of
estimated costs, and the right to proceed or withdraw such request. Any Attorney’s fees incurred as
a result of a breach of any term or condition contained within this Lease shall not be subject to
any cap.

ARTICLE THIRTEEN: MISCELLANEOUS PROVISIONS

     Section 13.01. Non-Discrimination. Tenant promises, and it is a condition to
the continuance of this Lease, that there will be no discrimination against, or segregation of, any
person or group of persons on the basis of race, color, sex, creed, national origin or ancestry in
the leasing, subleasing, transferring, occupancy, tenure or use of the Property or any portion
thereof.

     Section 13.02. Landlord’s Liability; Certain Duties.

     (a) As used in this Lease, the term “Landlord” means only the current owner or owners
of the fee title to the Property or Project or the leasehold estate under a ground lease of the
Property or Project at the time in question. Each Landlord is obligated to perform the obligations
of Landlord under this Lease only during the time such Landlord owns such interest or title. Any
Landlord who transfers its title or interest is relieved of all liability with respect to the
obligations of Landlord under this Lease to be performed on or after the date of transfer. However,
each Landlord shall deliver to its transferee all funds that Tenant previously paid if such funds
have not yet been applied under the terms of this Lease.

     (b) Tenant shall give written notice of any failure by Landlord to perform any of its
obligations under this Lease to Landlord and to any ground lessor, mortgagee or beneficiary under
any deed of trust encumbering the Property whose name and address have been furnished to Tenant in
writing. Landlord shall not be in default under this Lease

			
	1988	 	Southern California Chapter

of the Society of
Industrial
 and Office
Realtors, Inc.

17

 

unless Landlord (or such ground lessor, mortgagee or beneficiary) fails to cure such
non-performance within thirty (30) days after receipt of Tenant’s notice. However, if such
non-performance reasonably requires more than thirty (30) days to cure, Landlord shall not be in
default if such cure is commenced within such thirty (30)-day period and thereafter diligently
pursued to completion.

     (c) Notwithstanding any term or provision herein to the contrary, the liability of Landlord
for the performance of its duties and obligations under this Lease is limited to Landlord’s
interest in the Property and the Project, and neither the Landlord nor its partners, shareholders,
officers or other principals shall have any personal liability under this Lease.

     Section 13.03. Severability. A determination by a court of competent
jurisdiction that any provision of this Lease or any part thereof is illegal or unenforceable shall
not cancel or invalidate the remainder of such provision or this Lease, which shall remain in full
force and effect.

     Section 13.04. Interpretation. The captions of the Articles or Sections of this
Lease are to assist the parties in reading this Lease and are not a part of the terms or provisions
of this Lease. Whenever required by the context of this Lease, the singular shall include the
plural and the plural shall include the singular. The masculine, feminine and neuter genders shall
each include the other. In any provision relating to the conduct, acts or omissions of Tenant, the
term “Tenant” shall include Tenant’s a gents’ employees, contractors, invitees, successors or
others using the Property with Tenant’s expressed or implied permission.

     Section 13.05. Incorporation of Prior Agreements; Modifications. This Lease
(including the Exhibits and riders attached hereto) is the only agreement between the
parties pertaining to the lease of the Property and no other agreements are effective. All
amendments to this Lease shall be in writing and signed by all parties. Any other attempted
amendment shall be void.

     Section 13.06. Notices. All notices required or permitted under this Lease
shall be in writing and shall be personally delivered or sent by certified mail, return receipt
requested, postage prepaid. Notices to Tenant shall be delivered to the address specified in
Section 1.03 above. Notices to Landlord shall be delivered to the address specified in Section 1.02
above. All notices shall be effective upon delivery. Either party may change its notice address
upon written notice to the other party.

     Section 13.07. Waivers. All waivers must be in writing and signed by the
waiving party. Landlord’s failure to enforce any provision of this Lease or its acceptance of rent
shall not be a waiver and shall not prevent Landlord from enforcing that provision or any other
provision of this Lease in the future. No statement on a payment check from Tenant or in a letter
accompanying a payment check shall be binding on Landlord. Landlord may, with or without notice to
Tenant, negotiate such check without being bound to the conditions of such statement.

     Section 13.08. No Recordation. Tenant shall not record this Lease without
prior written consent from Landlord. However, either Landlord or Tenant may require that a “Short
Form” memorandum of this Lease executed by both parties be recorded. The party requiring such
recording shall pay all transfer taxes and recording fees.

     Section 13.09. Binding Effect; Choice of Law. This Lease binds any party
who legally acquires any rights or interest in this Lease from Landlord or Tenant. However,
Landlord shall have no obligation to Tenant’s successor unless the rights of interests of Tenant’s
successor are acquired in accordance with the terms of this Lease. The laws of the state in which
the Property is located shall govern this Lease.

     Section 13.10. Corporate Authority; Partnership Authority. If Tenant is a
corporation, each person signing this Lease on behalf of Tenant represents and warrants that he has
full authority to do so and that this Lease binds the corporation. Within thirty (30) days after
this Lease is signed, Tenant shall deliver to Landlord a certified copy of a resolution of Tenant’s
Board of Directors authorizing the execution of this Lease or other evidence of such authority
reasonably acceptable to Landlord. If Tenant is a partnership, each person or entity signing this
Lease for Tenant represents and warrants that he or it is a general partner of the partnership,
that he or it has full authority to sign for the partnership and that this Lease binds the
partnership and all general partners of the partnership. Tenant shall give written notice to
Landlord of any general partner’s withdrawal or addition. Within thirty (30) days after this Lease
is signed, Tenant shall

			
	1988	 	Southern California Chapter

of the Society of
Industrial 
and Office
Realtors, Inc.

18

 

deliver to Landlord a copy of Tenant’s recorded statement of partnership or certificate of
limited partnership.

     Section 13.11. Joint and Several Liability. All parties signing this Lease as
Tenant shall be jointly and severally liable for all obligations of Tenant.

     Section 13.12. Force Majeure. If Landlord cannot perform any of its
obligations due to events beyond Landlord’s control, the time provided for performing such
obligations shall be extended by a period of time equal to the duration of such events. Events
beyond Landlord’s control include, but are not limited to, acts of God, war, civil commotion, labor
disputes, strikes, fire, flood or other casualty, shortages of labor or material, government
regulation or restriction and weather conditions.

     Section 13.13. Execution of Lease. This Lease may be executed in
counterparts and, when all counterpart documents are executed, the counterparts shall
constitute a single binding instrument. Landlord’s delivery of this Lease to Tenant shall not be
deemed to be an offer to lease and shall not be binding upon either party until executed and
delivered by both parties.

     Section 13.14. Survival. All representations and warranties of Landlord and
Tenant shall survive the termination of this Lease.

ARTICLE FOURTEEN: BROKERS 

     Section 14.01.
Broker’s Fee. When this Lease is signed by and delivered to
both Landlord and Tenant and upon the Commencement Date of the Lease, Landlord shall pay a
real estate commission to Landlord’s Broker named in Section 1.08 above, if any, as provided in the
written agreement between Landlord and Landlord’s Broker, or the sum stated in Section 1.09 above
for services rendered to Landlord by Landlord’s Broker in this transaction. Landlord shall pay
Landlord’s Broker a commission if Tenant exercises any option to extend the Lease Term or to buy
the Property, or any similar option or right which Landlord may grant to Tenant, or if Landlord’s Broker is the procuring cause of any other lease or sale entered into between Landlord and Tenant
covering the Property. Such commission shall be the amount set forth in Landlord’s Broker’s commission schedule in effect as of the execution of this Lease. If a Tenant’s Broker is named in
Section 1.08 above, Landlord’s Broker shall pay an appropriate portion of its commission to
Tenant’s Broker if so provided in any agreement between Landlord’s Broker and Tenant’s Broker.
Nothing contained in this Lease shall impose any obligation on Landlord to pay a commission or fee
to any party other than Landlord’s Broker.

     Section 14.02. Protection of Brokers. If Landlord sells the Property, or assigns
Landlord’s interest in this Lease, the buyer or assignee shall, by accepting such conveyance of
the Property or assignment of the Lease, be conclusively deemed to have agreed to make all payments
to Landlord’s Broker thereafter required of Landlord under this Article Fourteen. Landlord’s Broker shall have the right to bring a legal action to enforce or declare rights under this
provision. The prevailing party in such action shall be entitled to reasonable attorneys’ fees to
be paid by the losing party. Such attorneys’ fees shall be fixed by the court in such action. This
Paragraph is included in this Lease for the benefit of Landlord’s Broker .

     Section 14.03. Agency Disclosure; No Other Brokers. Landlord and Tenant
each warrant that they have dealt with no other real estate broker(s) in connection with
this transaction except: VOIT COMMERCIAL., who represents Landlord and CB Richard Ellis who
represents Tenant.

in the event that N/A represents both Landlord and Tenant, Landlord and Tenant hereby confirm that
they were timely advised of the duai representation and that they consent to the same, and that
they do not expect said broker to disclose-to either of them the
confidential information of the
other party.

ARTICLE FIFTEEN: COMPLIANCE

     The parties hereto agree to comply with all applicable federal, state and local laws,
regulations, codes, ordinances and administrative orders having jurisdiction over the parties,
property or the subject matter of this Agreement, including, but not limited to, the 1964 Civil
Rights Act and all amendments thereto, the Foreign Investment In Real Property Tax Act, the
Comprehensive Environmental Response Compensation and Liability Act, and The Americans With
Disabilities Act.

			
	1988	 	Southern California Chapter

of the Society of
Industrial
 and Office
Realtors, Inc.

19

 

     ADDITIONAL PROVISIONS MAY BE SET FORTH IN A RIDER OR RIDERS ATTACHED HERETO OR IN THE
BLANK SPACE BELOW. IF NO ADDITIONAL PROVISIONS ARE INSERTED, PLEASE DRAW A LINE THROUGH THE SPACE
BELOW.

			
	1988	 	Southern California Chapter

of the Society of
Industrial
 and Office
Realtors, Inc.

20

 

     Landlord and Tenant have signed this Lease at the place and on the dates specified
adjacent to their signatures below and have initialed all Riders which are attached to or
incorporated by reference in this Lease.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	“LANDLORD”
	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Signed on:

	 	12/18/06	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	New Goodyear Ltd.,	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	a California limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ [ILLEGIBLE]	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 

	 	 	 	 	 	Its:
	 	General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	“TENANT”
	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Signed on:

	 	12/22/06	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	IsoTis OrthoBiologics, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	a Washington corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Pieter Wolters	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 

	 	 	 	 	 	 	 	Pieter Wolters	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Its:
	 	Chief Executive Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Gene Reu	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 	 	 	 	 	 	Gene Reu
	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Its:
	 	Vice President Operations	 	 

     IN ANY REAL ESTATE TRANSACTION, IT IS RECOMMENDED THAT YOU CONSULT WITH A PROFESSIONAL, SUCH
AS A CIVIL ENGINEER, INDUSTRIAL HYGIENIST OR OTHER PERSON WITH EXPERIENCE IN EVALUATING THE
CONDITION OF THE PROPERTY, INCLUDING THE POSSIBLE PRESENCE OF ASBESTOS, HAZARDOUS MATERIALS AND
UNDERGROUND STORAGE TANKS.

     THIS PRINTED FORM LEASE HAS BEEN DRAFTED BY LEGAL COUNSEL AT THE DIRECTION OF THE SOUTHERN
CALIFORNIA CHAPTER OF THE SOCIETY OF INDUSTRIAL AND OFFICE REALTORS®, INC. NO REPRESENTATION OR
RECOMMENDATION IS MADE BY THE SOUTHERN CALIFORNIA CHAPTER OF THE SOCIETY OF INDUSTRIAL AND OFFICE
REALTORS®, INC., ITS LEGAL COUNSEL, THE REAL ESTATE BROKERS NAMED HEREIN, OR THEIR EMPLOYEES OR
AGENTS, AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT OR TAX CONSEQUENCES OF THIS LEASE OR OF THIS
TRANSACTION. LANDLORD AND TENANT SHOULD RETAIN LEGAL COUNSEL TO ADVISE THEM ON SUCH MATTERS AND
SHOULD RELY UPON THE ADVICE OF SUCH LEGAL COUNSEL.

			
	1988	 	Southern California Chapter

of the Society of Industrial

and Office Realtors, Inc.

21

 

EXHIBIT “A” — SITE PLAN

			
	1988	 	Southern California Chapter

of the Society of Industrial

and Office Realtors, Inc.

22

 

EXHIBIT “B” — FLOOR PLAN

			
	1988	 	Southern California Chapter

of the Society of Industrial

and Office Realtors, Inc.

23

 

EXHIBIT “C” — TENANT IMPROVEMENTS

Tenant Improvements shall be constructed in substantial conformance with the Plans and
Specifications identified as Isotis Ortho Biologiecs 2 B Goodyear, prepared by Ware Malcomb
Architects, dated 11/20/06, sheets A0.1 to A8.3.

			
	1988	 	Southern California Chapter

of the Society of Industrial

and Office Realtors, Inc.

24

 

EXHIBIT “D” — APPROVED HAZARDOUS MATERIALS

1. Standard office and household cleaning products

2. The following materials (“Hazardous Materials”):

a)
Acetonitrile

b)
Ethyl Acetate

c) 2 Propanol

d) Trichloroacetic Acid ACS Reagent

e) Isopropyl Alcohol

f) Ethyl Alcohol, Regent, Denatured, Spectrophotometric Grade

g) 70% ethanol

h)
10% formalin

i)
Ethyl alcohol, 70, 90, 95 and 100%

j)
Xylene

k)
Hydrochloric Acid, 0.5N

l)
70% and 100% Methanol

In no event shall Tenant store quantities of more than one (1) gallon of any materials or chemicals
listed, excepting (1) 70% isopropyl alcohol which is used to disinfect work surfaces; (2)
hydrochloric acid which is used in product processing; and (3) Methanol which is used in product
processing.

Tenant shall store all Hazardous Materials in compliance with all State and Federal laws.

			
	1988	 	Southern California Chapter

of the Society of Industrial

and Office Realtors, Inc.

25

 

RIDER NO. 1

THIS RIDER NO. 1 (“RIDER NO. 1”) is dated February 23, 2006 for reference purposes as and is
made between New Goodyear LTD. a California Limited Partnership (“Landlord”) and IsoTis
OrthoBiologics. Inc., a Washington corporation, (“Tenant”) to be a part of that certain
Industrial Real Estate Lease (Multi-Tenant Net Form) of even date herewith between Landlord and
Tenant (the “Lease”) concerning a portion of the Project
more commonly known as 2 Goodyear,
Unit-A, at Irvine, California (the “Property”). Landlord and Tenant agree that the
Lease is hereby modified and supplemented as follows:

	1.	 	Section 1.12(a) (Base Rent) of the Lease shall be ameded by adding the following:
	 
	 	 	“The Base Rent shall be increased during the Term as follows:

	 	 	 	 	 	 	 
	 

	 	Months 01-12
	$	43,538.00 (Month 1 to commence August 1, 2006)

	 

	 	Months 13-24
	$	45,714.90	 	 
	 

	 	Months 25-36
	$	47,891.80	 	 
	 

	 	Months 37-48
	$	50,068.70	 	 
	 

	 	Months 49-60
	$	52,245.60	 	 

	2.	 	Condition of Property:
	 
	 	 	Section 6.01 (Existing Conditions) of the Lease shall be amended by adding the
following after the last sentence of Section 6.01:
	 
	 	 	Subject to paragraphs 2, 3,20 and 21 of this Rider
No. 1, (i) Property is being
leased in an “AS IS” condition with all faults, and (ii) Tenant has made and is relying
solely on its own investigation of operative or proposed governmental laws and regulations
(including, but not limited to, zoning, environmental, and land use laws and regulations) to
which the Property is or may be subject, and (iii) Tenant shall rely solely upon its own
investigation of the physical and environmental conditions of the Property, including
subsurface conditions.
	 
	 	 	Landlord warrants that the mechanical (excepting systems associated with the existing clean
room), electrical, plumbing, lighting and HVAC systems will be in good working condition at
the time Tenant occupies the Property and until 180 days following initial occupancy or
access by Tenant pursuant to Paragraph 5 of this Rider No. 1 unless Tenant misuses, damages
or breaks any or all components of the mechanical, plumbing, lighting and HVAC Systems.
Further, Landlord shall, at no expense to Tenant, perform any corrective work to the
Property, other than with respect to the clean room, necessary to remedy any violations
(including any existing improvement work performed without a required building permit) of
the applicable building code as it existed at the time of such original work if (a) such
corrective work is necessary to permit Tenant to obtain building permits for its initial
tenant improvements or to receive a certificate of occupancy for the Property, and (b) such
corrective work is not to be demolished or substantially altered in connection with the
improvement work to be performed by Tenant as a part of its initial buildout. It is
acknowlaged by Tenant that Landlord does not warrant the condition or opperability of the
existing clean room and Tenant shall bear the cost of maintaining same and ensuring its good
working order at the termination of the lease.
	 
	3.	 	Tenant Improvements:
	 
	 	 	Landlord will provide an allowance of Sixty Five Thousand Eight Hundred Fifty Five
and 00/100 dollars ($65,855.00) for Tenant’s use in the construction of Tenant Improvements,
subject to Landlord’s reasonable approval of proposed Tenant Improvements in accordance with
the attached Exhibit C to the Lease. Tenant shall be responsible for all plans, permits and
construction. The allowance shall be funded upon Tenant’s notification to Landlord that
Tenant Improvements are completed in substantial conformance with the Improvements depicted
in Exhibit C of the Lease Agreement, per city approved plans and specifications, signed off
by the city building inspector. All as built plans reflecting the existing configuration of
the space at the time MTI (“Current Tenant”) took possession of the Property will be
provided to Tenant at Landlord’s cost promptly following execution of the Lease. Tenant
shall have the option to hire a licensed contractor and/or subcontractors of their choosing
to complete its tenant improvements. Tenant shall be responsible for the implementation and
management of all Tenant Improvement construction. Tenant shall indemnify Landlord against
any labor and material liens.
	 
	4.	 	Clean Room:
	 
	 	 	Tenant shall be permitted to modify the existing Clean Room in the Property, subject
to Landlord’s reasonable approval and Tenant agrees to diligently pursue such modifications
and their approval by required governmental authorities. The Clean

Page 1 of 7

 

	 	 	Room, including all mechanical equipment required to make it function shall become
Landlord’s property at expiration of the Lease or upon vacancy by Tenant and Tenant shall
have no right or obligation to remove same from the Property.
	 
	5.	 	Early Access:
	 
	 	 	Commencing upon the date (the “Early Access Date”) upon which the Current Tenant, the
Current Tenant vacated the Property, which Early Access Date occured on April
15th, 2006, and continuing thereafter until July 15, 2006 (the “Early Access
Period”), Tenant shall have early access to the Property for purposes of construction of its
Tenant Improvements installing fixtures and equipment and occupying the Property. The Early
Access Period is subject to compliance with any applicable Orange County or City of Irvine
occupancy codes. Tenant shall remain responsible for utilities expenses during the Early
Access Period. The early access period will terminate and the Commencement Date shall occur
on July 15, 2006, irrespective of the status of the tenant improvements. All terms and
conditions of their Lease shall apply during the Early Access Period, except that Tenant
shall have no obligation to pay Base Rent or reimbursement for insurance premiums, real
property taxes or common area expenses. Following such Early Access Period, Tenant shall be
fully obligated under the terms and conditions of this Lease, irrespective of whether Tenant
has successfully obtained FDA or any other required governmental or regulatory approval
required to legally operate the clean room and Tenant shall pay rent as if it is in full
occupancy of the Property (Unit- A) in accordance with the payment schedule outlined in
paragraph 1 above plus applicable expense reimbursements in accordance with Article 4 of the
Lease.
	 
	6.	 	Defaults:
	 
	 	 	Section 10.02(b) of the lease shall be amended by adding the following:
	 
	 	 	“Notwithstanding Tenant’s obligation to pay rent when due and provided Tenant has been
late not more than once within the previous 12 months and not more that four times
during the term of the lease, Landlord shall give Tenant notice by facsimile or
personal delivery of the failure to receive rent and Tenant shall not be in material
default if such rent is received within five (5) business days from the date of such
notice. For payment of any charge other than monthly rent, Tenant shall not be in
material default for late payment unless Landlord has first given Tenant such invoices
as called for herein or otherwise made demand or given Tenant notice of such payment
not less than ten (10) days prior to such amount being due from Tenant.”
	 
	7.	 	Assignment or Sublet:
	 
	 	 	Tenant shall have the right to assign the Lease or sublet all or a portion of the
demised premises to any subsidiary or affiliate without Landlord’s consent, provided that:
a) there has been no prior default beyond all applicable cure periods and, b) the financial
condition of the assignee is not materially different from Tenant. Tenant shall remain
liable for any rent due from a Subleasee. Any other assignment or subletting will be subject
to Landlord’s prior consent, which shall not be unreasonably withheld or delayed. Landlord
and Tenant shall equally share any rental profits from said sublease.
	 
	8.	 	Hazardous Materials:
	 
	 	 	Section 6.01 (Existing Conditions) shall be amended by adding the following after the
last sentence of Section 6.01:
	 
	 	 	If, subsequent to the date Tenant accepts possession of the Property, it is determined that
there are any asbestos-containing materials or other Hazardous Materials that were located
in, on or under the Property prior to Landlord’s delivery of the Property to Tenant, and
such materials were not installed by Tenant or any affiliate of Tenant (or any party acting
under Tenant) and such materials are required by applicable law, by Landlord, or by
Landlord’s lender to be removed, encapsulated or otherwise treated (“Remediated”), Landlord,
at Landlord’s expense, shall as soon as practicable after notice thereof from Tenant,
Remediate said materials.
	 
	9.	 	Multiple Defaults:
	 
	 	 	If Tenant is in default under this Lease beyond all applicable cure periods more than
one (1) time within any twelve-month period, irrespective of whether or not such default
iscured, then, without limiting Landlord’s other rights and remedies provided for in
this Lease or at law or equity, the Security Deposit shall automatically be increased by two
(2) times the original Security Deposit.
	 
	10.	 	Americans with Disabilities Act:

Page 2 of 7

 

	 	 	Tenant has been advised that Tenant may be subjected to the Americans with Disabilities Act
(the “ADA”), a Federal Law codified at 42 USC Section 12101 et seq. and Tenant covenants and
warrants that Tenant will comply with all ADA requirements. Among other requirements of the
ADA that could apply to the property, Title III of the ADA requires a Tenant of “public
services” to provide accommodations for hearing, vision and speech impaired persons. The
regulations under Title III of the ADA are codified at 28 CFR Part 36. Notwithstanding the
proceeding language, Landlord shall be responsible for the cost of any and all ADA
compliance requirements relating to the exterior of the Property, unless a change in use by
Tenant is the cause of additional ADA compliance.
	 
	11.	 	Common Area Section 4.05 (e) (Tenant’s Share
and Payment) of the Lease shall be amended by
adding the following after the last sentence of Section 4.05 (e):
	 
	 	 	“Common Area costs shall also include, roof repairs and maintenance (which roof repairs and
maintenance will be capped in the initial year at $3,000 but will be subject to the
provisions of paragraph 31 below), HVAC repairs and maintenance, exterior wall repair and
any other service required to keep the Property in good order, condition and repair. For
clarification purposes, HVAC repairs and maintenance costs shall specifically exclude
replacement of major HVAC components such as compressor units and such HVAC repairs and
maintenance costs shall not exceed an annual cost in excess of 20% of the annual HVAC
maintenance contract secured by Landlord or by Tenant pursuant to the provisions of the
lease under Section 6.04 a.
	 
	12.	 	Insurance policies. Section 4.04 (a) (Liability Insurance) of the Lease shall
be amended by adding the following after the last sentence of Section 4.04 (a):
	 
	 	 	The Landlord reserves the right to limit the deductible amount, if any, for bodily/personal
injury and/or property damage liability to an amount no greater than $10,000 per occurrence.
The Tenant is fully responsible for payment of any deductible regardless of its amount (up
to $10,000 per occurance).
	 
	13.	 	Rules and Regulations:

	 	a)	 	Parking or storage of vehicles overnight is prohibited, except delivery
vehicles in Tenant truck wells.
	 
	 	b)	 	Absolutely no parking at any time in any areas designated as “No Parking”
or “Fire Lane” or in any truck dock or ramp position not a part of the Property.
	 
	 	c)	 	Absolutely no parking of trailers, boats or any other vehicles or equipment.
	 
	 	d)	 	Absolutely no maintenance is to be performed on any trucks,
automobiles, trailers or other equipment other than tire changes and safety
checks.
	 
	 	e)	 	Unusual expenses created by the washing of vehicles will result in
special assessment to Tenant for water and/or physical repair of the Property.
	 
	 	f)	 	Absolutely no outside storage is allowed, including but not limited to
pallets, equipment, work in progress, or raw materials.
	 
	 	g)	 	Tenant shall not do or permit anything to be done which is a nuisance
or interferes with any other tenant in the Project.

	14.	 	Surrender of Property:
	 
	 	 	At the expiration of this Lease, Tenant shall surrender the Property in the same condition
as was existing upon delivery of possession, except as to tenant improvements completed by
Tenant pursuant to paragraph 3 above, and except as provided in Section 6.03, 6.05, 6.06,
Article 7 and Article 8 of this Lease, reasonable wear and tear excepted, and shall deliver
all keys to Landlord. Before surrendering the Property, Tenant shall remove all of its
Personal Property and trade fixtures and such alterations or additions to the Property made
by Tenant as may be specified for removal thereof pursuant to Section 6.05 or 6.06 of the
Lease. If Tenant fails to remove its personal property and fixtures upon the expiration of
this Lease, the same shall be deemed abandoned and shall become the property of the
Landlord.
	 
	15.	 	Signage:
	 
	 	 	Tenant shall have the right to install top building signage, at its sole cost, on the
building subject to the City of Irvine regulations and Irvine Spectrum CC&R’s. Tenant shall
remove signage upon vacancy and restore the building surface to which the signage is affixed
to its original condition. Painting of patch areas shall match existing paint.
	 
	16.	 	Mechanic’s Lien:
	 
	 	 	Should any mechanics or other lien be filed against the Property or any part thereof by
reason of Tenant’s acts or omissions or because of a claim against Tenant, Tenant shall
cause the same to be canceled and discharged of record by bond or otherwise with ten (10)
days of Tenant’s receipt of notice by Landlord.

Page 3 of 7

 

	17.	 	Financial Strength:
	 
	 	 	Tenant covenants and warrants that as of the Commencement Date of the Lease, Tenant
has the financial strength and assets to meet all of its obligations under the terms and
conditions of the Lease. Tenant covenants and warrants, at the time of Lease signature, that
neither Tenant nor any Tenant affiliate is: 1) in default under any terms and conditions of
any other lease for real property, 2) in default for any monetary obligation, 3) in
foreclosure on any real property, or 4) under the protection of any bankruptcy codes.
	 
	18.	 	Hold Harmless:
	 
	 	 	Landlord hereby agrees to hold Tenant harmless from any injury to Landlord’s
employees, agents and invitees, except to the extent caused by or arising in connection
with the use of the Property by Tenant or its employees, agents or invitees, Tenant’s
breach of this Lease, or any negligent or willful misconduct by Tenant or any of Tenant’s
employees, agents, or invitees.
	 
	19.	 	Designated Parking:
	 
	 	 	Landlord will permit Tenant to designate up to 10 parking spaces, proximate to
Tenant’s entry, as either reserved or visitor spaces by indicating such on the curb face.
Curb face identification shall be removed by Tenant upon vacancy of the Project. Tenant
acknowledges that Landlord has no obligation to enforce Tenant’s exclusive use of the
designated spaces.
	 
	20.	 	Limitations on Tenant’s Liability.
	 
	 	 	Tenant shall not have any responsibility or liability for (i) existing violations of
any federal, state, or local law relating to the Property or the Project as of the date
Tenant takes possession of the Property, including, but not limited to, violations of any
law relating to Hazardous Materials (“Hazardous Materials Laws”), building codes, and, with
respect only to the exterior portions of the Property the Americans with Disabilities Act of
1990, 42 U.S.C. § § 12101 et seq. and 47 U.S.C. § § 225 et seq. as amended from time to
time, and any similar or successor federal, state, or local laws (collectively, the “ADA”)
(the ADA, Hazardous Materials Laws, building codes and all of the other foregoing federal,
state and local laws shall be collectively referred to as “Applicable Laws”), (ii) any
Hazardous Materials present in, on, under or about any part of the Property or the Project
as of the date Tenant takes possession of the Property or that are brought into, onto,
about, or under any part of the Property or Project by anyone other than Tenant or Tenant’s
agents, employees, invitees or contractors, or (iii) without limiting the generality of
subparts (i) and (ii) above, the cleanup, remediation, or removal of any Hazardous Materials
present in, on, under or about any part of the Property or Project as of the date Tenant
takes possession of the Property or that are brought into, onto, about, or under any part of
the Property or Project by anyone other than Tenant or Tenant’s agents, employees, invitees
or contractors.
	 
	21.	 	Certain Representations and Warranties of Landlord:
	 
	 	 	Notwithstanding anything in this Lease to the contrary, Landlord represents and
warrants to Tenant, as of the date hereof and as of the date Tenant’s initial tenant
improvements are completed, that (i) there are no liens, encumbrances, leases, mortgages,
deeds of trust or other encumbrances against Landlord’s right, title or interest in or to
the Property or Project other than as are of record, and (ii) to Landlord’s knowledge, there
are no Hazardous Materials located in, on, under or about any part of the Property or
Project.
	 
	22.	 	Landlord’s Indemnity.
	 
	 	 	Landlord shall defend (with counsel reasonably acceptable to Tenant), indemnify and
hold harmless Tenant and is officers, directors, shareholders, subsidiaries, employees,
agents and representatives from and against any and all claims, third-party claims, actions,
lawsuits (including, but not limited to, claims, actions and lawsuits brought by the
government or third parties), losses, harm, costs (including, but not limited to, court
costs, costs of appeal, and cleanup, removal and remediation costs associated with any
Hazardous Materials) liabilities, contribution claims, damages and expenses including, but
not limited to, attorneys’ fees and court costs, arising, whether before or after the
expiration or earlier termination of this Lease, out of or in connection with the gross
negligence or intentional misconduct of Landlord or its employees, contractors or agents.
	 
	23.	 	Damage and Destruction.
	 
	 	 	Subject to Article Seven of this Lease, but, notwithstanding anything in this Lease
to the contrary, if, within four months from receipt of building permits, Landlord does not
also make substantially complete all repairs required by Article Seven of this Lease and
deliver possession of the Property to Tenant, in accordance with this Lease, then
Tenant

Page 4 of 7

 

	 	 	may terminate this Lease by giving Landlord written notice within thirty (30) days at any
time after said four month period, which termination shall be effective upon delivery of
such notice subject to Article Seven of this Lease. Landlord shall proceed diligently and in
good faith to obtain all required building permits and to repair the Property and Project.
	 
	24.	 	Tenant’s Performance Rights:
	 
	 	 	If Landlord fails to perform any of its obligations under this Lease, including but
not limited to Landlord’s repair and maintenance obligations, within the applicable cure
period,and such failure to perform (a) poses an immediate threat to persons or property in
the interior of the Property or otherwise has a material, adverse impact on the operations
or property of Tenant in the interior of the Property, and (b) continues for a period of
more than fifteen (15) days after Landlord’s receipt a Final Notice (as defined below), then
Tenant shall have the right (but not the obligation) to perform such Landlord obligations
sufficiently to eliminate such immediate threat or other material, adverse impact and to
bill Landlord for the reasonable, out-of-pocket cost thereof, which Landlord shall pay to
Tenant within fifteen (15) days of receipt of Tenant’s bill and supporting documentation
therefor. As used herein, “Final Notice” shall mean a written notice given by Tenant to
Landlord after the lapse of all applicable cure periods, which notice must, in order to be
effective. (i) identify with specificity the obligations that Landlord has failed to
perform, and (ii) state with specificity the immediate threat to persons or property, or
other material, adverse impact on the operations or property of Tenant that is caused by
such failure by Landlord, and (iii) state Tenant’s intention to perform such obligation(s),
at Landlord’s expense pursuant to this Section 28, if Landlord shall fail to do so within
fifteen (15) days, and (iv) state with specificity the actions that Tenant intends to take,
and the estimated cost thereof.
	 
	25.	 	Binding Force:
	 
	 	 	Submission of this Rider is not an offer to lease or amend the Lease. This Rider
shall become binding upon Landlord and Tenant only when this Rider is fully executed and
delivered by Landlord. In the event Landlord does not execute and deliver the Rider, then
the Rider shall be void and of no force or effect.
	 
	26.	 	Ratification of Lease:
	 
	 	 	The terms of the Lease are amended to reflect the changes set forth herein. In all
other respects the terms of the Lease shall be in full force and effect. In the event of any
conflict between this Rider No. 1 and the Lease, the terms of this Rider No. 1 shall be
deemed controlling.
	 
	27.	 	Capitalized Terms:
	 
	 	 	Except as otherwise expressly provided herein, the capitalized terms and phrases in
this Rider No. 1 shall have the same meanings as are given such terms in the Lease.
	 
	28.	 	Authority:
	 
	 	 	If Tenant is a corporation, trust or general or limited partnership, each individual
executing this Rider No. 1 on behalf of such entity represents and warrants that he or she
is duly authorized to execute and deliver this Rider No. 1 on behalf of said entity.
	 
	29.	 	Right of First Offer:
	 
	 	 	Tenant shall have an ongoing right of first offer on 2 Goodyear, Unit B, of the
Project throughout the Lease Term (as extended). Tenant shall have fifteen (15) days from
receipt of written notice from Landlord regarding the availability of the space (which
notice may be delivered up to six (6) months prior to actual occupancy by Tenant of such
space) to exercise or waive its right of first offer. All space taken under the terms of
this right of first offer shall be identical to the terms and conditions (at the time such
right is exercised) to those of the Lease, excepting the Tenant Improvement Allowance and
early access rights.
	 
	30.	 	Termination of Lease for 2 Goodyear, Unit B:
	 
	 	 	Landlord and Tenant agree that the rights and obligations of the parties under the
Industrial Real Estate Lease dated December 28, 1998 with respect to 2 Goodyear, Unit B (the
“Unit B Lease”), shall remain in effect until its termination on March 31st ,2007
pursuant to the terms and conditions of the Unit B lease. Tenant shall completely vacate
2 Goodyear, Unit B, and Tenant shall surrender the property located at 2 Goodyear, Unit B,
broom clean and (notwithstanding anything to the contrary in Section 6.06 of the Unit B
Lease) “as-is” and Tenant shall remove the property listed on Schedule 1 to this Rider No.
1., and Tenant shall satisfy each of the other requirements set forth in Landlord’s letters
dated February 23, 2006 to Tenant (Mr. Ron Maldanado).

Page 5 of 7

 

	31.	 	Limitation on Certain Costs:
	 
	 	 	Notwithstanding anything to the contrary contained in the Lease, the aggregate amount that
Tenant shall be obligated to reimburse pursuant to, Section 4.04 (b) (insurance) and Section
4.05 (common area costs, which common area costs shall include Reserves) during any calendar
year of the Lease Term shall not exceed an amount equal to the aggregate amount of such
costs applicable during calendar year 2006 (annualized to reflect the costs that would have
been incurred if Tenant’s Commencement Date had been January 1, 2006) increased by five
percent each year, compounded annually. Thus, if Tenant’s annualized cost for calendar year
2006 were $100,000, it would not be required to reimburse an aggregate in excess of $105,000
for calendar year 2007, or $110,250 for calendar year 2008. Notwithstanding the foregoing,
the limitations set forth in this Paragraph 31 shall terminate immediately upon any
transfer, other than to Tenant’s Affiliate, of Tenant’s interest in the Lease or the
Property, regardless of whether Landlord consents to such transfer.

	 	 	 	 	 	 	 	 	 	 	 
	LANDLORD:
	 	 	 	TENANT:
	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	New Goodyear Ltd,	 	 	 	IsoTis OrthoBiologics, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	a California limited partnership	 	 	 	a Washington corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/[
ILLEGIBLE] 

	 	 	 	By:
	 	/s/
Pieter Wolters
	 	 
	 
	 	
	 	 	 	 	 	     Pieter Wolters
	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Its:

	 	General Partner
	 	 	 	Its:
	 	Chief Executive Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Gene Reu	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 

	 	 	 	 	 	 	 	     Gene Reu	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Its:
	 	Vice President Operations	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date:

	 	12/18/06
	 	 	 	Date:
	 	12/22/06	 	 

Page 6 of 7

 

SCHEDULE
1

 Property To Be Removed From Unit B

1. Bookcase in boardroom

2. Lyophilizers (6)

3. Autoclaves (2)

4. Biological Safety Cabinets (10)

5. Pallet Racking in warehouse

6. Finished Good Racking and associated fencing

7. Low Humidity Tissue Storage Cabinets

8. Servers with Racks

9. Telephone System

10. Forma Equipment Monitoring System

11. Time Clocks

12. Fume Hoods in laboratory

Page 7 of 7

 

Rider
No. 2 

Option To Extend Term Lease

This Rider is attached to and made part of that certain Lease (the “Lease”) dated February
15, 2006 between, New Goodyear LTD as Landlord, and IsoTis OrthoBiologics. Inc. as
Tenant, covering the Property commonly known as 2 Goodyear Unit- A at Irvine California,
(the “Property”). The terms used herein shall have the same definitions as set forth in the Lease.
The provisions of this Rider shall supersede any inconsistent or conflicting provisions of the
Lease.

A. Option(s) to Extend Term.

	 	1.	 Grant of Option.

	 	 	Landlord hereby grants to Tenant two (2) option(s) (the “Option”) to extend the Lease Term
for additional term of five (5) years each (the
“Extension(s)”), on the same terms and
conditions as set forth in the Lease, but at an increased rent as set forth below. Each
Option shall be exercised only by written notice delivered to Landlord at least one hundred
twenty (120) days, but not more than 360 days before the expiration of the Lease Term or the
preceding Extension of the Lease Term, respectively. If Tenant fails to deliver to Landlord
written notice of exercise of an Option within the prescribed time period, such Option and
any succeeding Options shall lapse, and there shall be no further right to extend the Lease
Term. Each Option shall be exercisable by Tenant on the express conditions that (a) at the
time of the exercise, and at all times prior to the commencement of such Extension, Tenant
shall not be in default under any of the provisions of the Lease beyond all applicable cure
periods and (b) Tenant has not been ten (10) or more days late in the payment of rent more
than a total of two (2) times during the preceding 12 month period.

	 	2.	 Personal Options.

	 	 	The Option(s) are personal to the Tenant named in Section 1.03 of the Lease or any Tenant’s
Affiliate described in Section 9.02 of the Lease. If Tenant subleases any portion of the
Property or assigns or otherwise transfers any interest under the Lease to any entity other
than a Tenant Affiliate prior to the exercise of an Option (whether with or without
Landlord’s consent), such Option and any succeeding Options shall lapse. If Tenant subleases
any portion of the Property or assigns or otherwise transfers any interest of Tenant under
the Lease to any entity other than a Tenant Affiliate after the exercise of an Option but
prior to the commencement of the respective Extension (whether with or without Landlord’s
consent), such Option and any succeeding Options shall lapse and the Lease Term shall expire
as if such Option were not exercised. If Tenant subleases any portion of the Property or
assigns or otherwise transfers any interest of Tenant under the Lease in accordance with
Article 9 of the Lease after the exercise of an Option and after the commencement of the
Extension related to such Option, then the term of the Lease shall expire upon the
expiration of the Extension during which such sublease or transfer occurred and only the
succeeding Options shall lapse.

B. Calculation of Rent.

	 	 	The Base Rent during the Extension(s)shall be determined by one or a combination of the
following methods (INDICATE METHOD UPON EXECUTION OF THE LEASE):

1. Cost of Living Adjustment (Section 2 B.1, below)

Rental
Adjustment Date(s): The first day of
the                    month(s)
of the first
and second (seo Section 3.02 of the Lease) Extension(s) of the
Lease Term.

2. Fair Rental Value Adjustment (Section B.2, below) as determined
by appraiser ________ or
broker

Rental
Adjustment Date(s): The first day of the first month(s) of the
first Extension only of the Lease Term.

On the Rental Adjustment Date, the Base Rent shall be adjusted to the “Fair Rental
Value” of the Property. Three R months prior to the Rental Adjustment Date, the
parties shall attempt to agree upon the what the new Fair Rental Value will be on
the adjustment date. If agreement cannot be reached within fifteen days, then both
Landlord and Tenant shall each immediately make a reasonable

 

 

determination of the Fair Rental Value of the Property and submit such
determination, in writing, for appraisal in accordance with the following provisions:

     (i) Within 15 days thereafter, Landlord and Tenant shall each select an appraiser of their
choice. The two appraisers so appointed shall immediately select a third mutually acceptable
appraiser to act as a third appraiser.

     (ii) The 3 appraisers shall within 15 days of their appointment of the third appraiser
reach a decision as to what the actual Fair Rental Value for the Property is, and whether
Landlord’s or Tenant’s submitted Fair Rental Value is the closest thereto. The decision of a
majority of the appraisers shall be binding on the parties. The submitted Fair Rental Value that is
determined to be closest to the actual Fair Rental Value shall thereafter be used by the parties.

     (iii) If either of the parties fails to appoint an appraiser within the specified 15
days, the appraiser timely appointed by one of them shall reach a decision on his or her own, and
said decision shall be binding on the parties.

     (iv) The entire cost of such appraisal(s) shall be paid equally by the party whose
submitted Fair Rental Value is not selected (i.e., the one that is not the closest to the actual
Fair Rental Value).

	 	 	3.	Fixed Adjustment
	 
	 	 	 	The Base Rent shall be incroased to the following amounts (tho “Adjusted Baso Ront(s)”) on tho
datos (tho “Rental Adjustment Dato(s)”) sot forth bolow:

	 	 	 	 	 	 	 
	 	 	Rental Adjustment Dato(s)	 	Adjusted Baso Ront(s)	 	 
	 

	 	Mos. 1 12	 	 	 	 
	 

	 	 

	 	 

	 	 
	 

	 	Mos. 13 24	 	 	 	 
	 

	 	 

	 	 

	 	 
	 

	 	Mos. 25 36	 	 	 	 
	 

	 	 

	 	 

	 	 
	 

	 	 

	 	 

	 	 

 

 

	 	2.1.	 	Cost of Living Adjustment.
	 
	 	 	 	The Base Rent shall be increased on the dates speaified-in-Section B.1, above (the
“Rental-Adjustment Date(s)”) by reference to the Index defined in Section 3.02 of the Lease
or the substitute-index described in Paragraph 3.02(b) of the Lease-as-follws: The Base
Rent-in-effeot immediately prior to-tbe-applicable-Rental Adjustment Date (the “Comparison
Base Rent”) shall be increased by the percentage (subject to the limitations described
in-Section 3.02 (a)) that the Index has increased from the month in which the payment of the
Comparison Base Rent commenced through the month in which tho applicable Rental Adjustment
Date occurs. In no event shall the Base Rent be reduced by reason of such computation.

	 	 	 	 	 	 	 	 	 	 	 
	LANDLORD:
	 	 	 	TENANT:
	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	New Goodyear Ltd,	 	 	 	IsoTis OrthoBiologics, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	a California limited partnership	 	 	 	a Washington corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ [ILLEGIBLE]
	 	 	 	By:
	 	/s/ Pieter Wolters	 	 
	 

	 	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	 	 	 	 	     Pieter Wolters	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Its:

	 	General Partner
	 	 	 	Its:
	 	Chief Executive Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ [Gene Reu]	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 

	 	 	 	 	 	 	 	     Gene Reu	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Its:
	 	Vice President Operations	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date:

	 	12/18/06
	 	 	 	Date:
	 	12/22/06Exhibit 10.20

 

Exhibit 10.20

INDEMNIFICATION AGREEMENT

     This Indemnification Agreement (this “Agreement”) is made as of January ___, 2007 (the
“Effective Date”) by and between IsoTis, Inc., a Delaware corporation (the “Company”), and
_____________, who serves as a director and/or officer of the Company (the
“Indemnitee”).

     WHEREAS, highly competent persons have become more reluctant to serve corporations as
directors or officers unless they are provided with adequate protection through insurance and/or
indemnification against the risks of claims being asserted against them arising out of their
service to and activities on behalf of such corporations;

     WHEREAS, the board of directors of the Company (the “Board”) has determined that, in
order to help attract and retain qualified individuals as directors and officers, the best
interests of the Company and its investors will be served by attempting to maintain, on an ongoing
basis, at the Company’s sole expense, insurance to protect persons serving the Company and its
subsidiaries as directors or officers from certain liabilities. Although the furnishing of such
insurance has been a customary and widespread practice among United States-based corporations and
other business enterprises for many years, the Company believes that, given current market
conditions and trends, such insurance may be available to it in the future only at higher premiums
and with more exclusions. At the same time, directors and officers in service to corporations or
business enterprises are being increasingly subjected to expensive and time-consuming litigation;

     WHEREAS, the Board has determined that, in order to help attract and retain qualified
individuals as directors and officers, the best interests of the Company and its investors will be
served by assuring such individuals that the Company will indemnify them to the maximum extent
permitted by law;

     WHEREAS, the Certificate of Incorporation (the “Certificate of Incorporation”) of the
Company require, and the By-Laws (the “By-Laws”) of the Company permit, indemnification of
the officers and directors of the Company, and Indemnitee may also be entitled to indemnification
pursuant to the Delaware General Corporation Law (“DGCL”);

     WHEREAS, the Certificate of Incorporation, the By-Laws and the DGCL either expressly provide
for or do not preclude the Company from entering into contracts with its directors and officers
with respect to indemnification and the advancement of defense costs;

     WHEREAS, the Board has determined that the increased difficulty in attracting and retaining
such persons is detrimental to the best interests of the Company’s investors and that the Company
should act to assure such persons that there will be increased certainty of such protection in the
future;

 

 

     WHEREAS, it therefore is reasonable, prudent and necessary for the Company contractually to
obligate itself to indemnify, and to advance defense costs on behalf of, such persons to the
fullest extent permitted by applicable law so that they will serve or continue to serve the Company
free from undue concern that they will not be so indemnified;

     WHEREAS, this Agreement is a supplement to and in furtherance of the Certificate of
Incorporation, By-Laws and any resolutions adopted pursuant thereto, and shall not be deemed a
substitute therefor, nor shall it be deemed to diminish or abrogate any rights of Indemnitee
thereunder;

     WHEREAS, the Board recognizes that the Indemnitee does not regard the protection available
under the Company’s Certificate of Incorporation, the By-Laws and insurance program as adequate in
the present circumstances, and may not be willing to serve or continue to serve as a director,
officer or in such other capacity as the Company may request without adequate protection, and the
Company desires Indemnitee to serve in such capacity; and

     WHEREAS, Indemnitee is willing to serve, and continue to serve, as a member of the Board (and
any committee thereof) or as an officer of the Company, on the condition that he or she be
indemnified as provided for herein.

     NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the
Company and Indemnitee do hereby covenant and agree as follows:

     1. Services to the Company. Indemnitee will serve or continue to serve, at the will of the
Company, as a director or officer of the Company for so long as Indemnitee is duly elected or
appointed or until Indemnitee tenders his or her resignation. This Agreement shall not serve as a
binding commitment on the part of Indemnitee to continue to serve in such capacity, or on the part
of the Company to cause him or her to be nominated to successive terms as a director or officer or
to not otherwise be removed for cause or without cause, as permitted under law.

     2. Definitions. As used in this Agreement:

          (a) “Beneficial Owner” shall have the meaning given to such term in Rule 13d-3 issued
under the Exchange Act; provided, however, that Beneficial Owner shall exclude any Person becoming
a Beneficial Owner by reason of the stockholders of the Company approving a merger of the Company
with another entity.

          (b) A “Change in Control” shall be deemed to occur upon the earliest to occur after
the date of this Agreement of any of the following events:

               (i) Acquisition of Stock by Third Party. Any Person (as defined below, but excluding
any subsidiary or employee benefit plan of the Company), subsequent to the date of this Agreement,
becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing
fifty percent (50%) or more of the

2

 

combined voting power of the Company’s then outstanding securities entitled to vote generally
in the election of directors, unless (1) the change in the relative Beneficial Ownership of the
Company’s securities by any Person results solely from a reduction in the aggregate number of
outstanding shares of securities entitled to vote generally in the election of directors, or (2)
such acquisition was approved in advance by the Continuing Directors (as defined below) and such
acquisition would not constitute a Change in Control under part (iii) of this definition;

               (ii) Change in Board of Directors. Individuals who, as of the date hereof, constitute
the Board, and any new director whose election by the Board or nomination for election by the
Company’s stockholders was approved by a vote of at least two thirds of the directors then still in
office who were directors on the date hereof or whose election for nomination for election was
previously so approved (collectively, the “Continuing Directors”), cease for any reason to
constitute at least a majority of the members of the Board;

               (iii) Corporate Transactions. The effective date of a reorganization, merger or
consolidation of the Company (a “Business Combination”), in each case, unless, following
such Business Combination: (1) all or substantially all of the individuals and entities who were
the Beneficial Owners of securities entitled to vote generally in the election of directors
immediately prior to such Business Combination beneficially own, directly or indirectly, more than
51% of the combined voting power of the then outstanding securities entitled to vote generally in
the election of directors of the Company resulting from such Business Combination (including,
without limitation, a corporation which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or through one or more Subsidiaries) in
substantially the same proportions as their ownership, immediately prior to such Business
Combination, of the securities entitled to vote generally in the election of directors; (2) no
Person (excluding any corporation resulting from such Business Combination) is the Beneficial
Owner, directly or indirectly, of 15% or more of the combined voting power of the then outstanding
securities entitled to vote generally in the election of directors of such corporation except to
the extent that such ownership existed prior to the Business Combination; and (3) at least a
majority of the Board resulting from such Business Combination were Continuing Directors at the
time of the execution of the initial agreement, or of the action of the Board, providing for such
Business Combination;

               (iv) Liquidation. The approval by the stockholders of the Company of a complete
liquidation of the Company or an agreement or series of agreements for the sale or disposition by
the Company of all or substantially all of the Company’s assets, other than factoring the Company’s
current receivables or escrows due (or, if such approval is not required, the decision by the Board
to proceed with such a liquidation, sale, or disposition in one transaction or a series of related
transactions); or

               (v) Other Events. There occurs any other event of a nature that would be required to
be reported in response to Item 6(e) of Schedule 14A of Regulation

3

 

14A (or a response to any similar item on any similar schedule or form) promulgated under the
Exchange Act (as defined below), whether or not the Company is then subject to such reporting
requirement.

          (c) “Corporate Status” shall describe the status of a person who is or was a director,
officer, trustee, partner, member, fiduciary, employee or agent of the Company or of any other
Enterprise (as defined below), which such person is or was serving at the request of the Company.

          (d) “Disinterested Director” shall mean a director of the Company who is not and was
not a party to the Proceeding (as defined below) in respect of which indemnification is sought by
Indemnitee.

          (e) “Enterprise” shall mean any corporation, limited liability company, partnership,
joint venture, trust, employee benefit plan or other enterprise of which Indemnitee is or was
serving at the request of the Company as a director, officer, trustee, administrator, partner,
member, fiduciary, employee or agent.

          (f) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

          (g) “Expenses” shall include all reasonable attorneys’ fees, retainers, court costs,
transcript costs, fees of experts and accountants, witness fees, travel expenses, duplicating
costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other
disbursements or expenses of the types and amounts customarily incurred in connection with
prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a
witness in, or otherwise participating in, a Proceeding (as defined below). Expenses also shall
include costs incurred in connection with any appeal resulting from any Proceeding (as defined
below), including, without limitation, the premium, security for, and other costs relating to any
bond, supersedeas bond, or other appeal bond or its equivalent. Expenses, however, shall not
include amounts paid in settlement by Indemnitee or the amount of judgments or fines against
Indemnitee.

          (h) “Independent Counsel” shall mean a law firm, or a member of a law firm, that is
experienced in matters of corporation law and neither presently is, nor in the past five (5) years
has been, retained to represent: (i) the Company or Indemnitee in any matter material to either
such party (other than with respect to matters concerning the Indemnitee under this Agreement, or
other indemnitees under similar indemnification agreements), or (ii) any other party to the
Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing,
the term “Independent Counsel” shall not include any person who, under the applicable standards of
professional conduct then prevailing, would have a conflict of interest in representing either the
Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

4

 

          (i) References to “fines” shall include any excise tax assessed on a person with
respect to any employee benefit plan pursuant to applicable law.

          (j) References to “serving at the request of the Company” shall include any service
provided at the request of the Company as a director, officer, trustee, administrator, partner,
member, fiduciary, employee or agent of the Company which imposes duties on, or involves services
by, such director, officer, trustee, administrator, partner, member, fiduciary, employee or agent
with respect to an employee benefit plan, its participants or beneficiaries.

          (k) “Person” shall have the meaning set forth in Sections 13(d) and 14(d) of the
Exchange Act; provided, however, that Person shall exclude (i) the Company and (ii) any trustee or
other fiduciary holding securities under an employee benefit plan of the Company or a subsidiary of
the Company.

          (l) Any action taken or omitted to be taken by a person for a purpose which he or she
reasonably believed to be in the interests of the participants and beneficiaries of an employee
benefit plan shall be deemed to have been taken in “good faith” and for a purpose which is
“not opposed to the best interests of the Company”, as such terms are referred to in this
Agreement and used in the DGCL.

          (m) The term “Proceeding” shall include any threatened, pending or completed action,
suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative
hearing or any other actual, threatened or completed proceeding, whether brought in the right of
the Company or otherwise and whether of a civil, criminal, administrative or investigative nature,
including any related appeal, in which Indemnitee was, is or will be involved as a party or witness
or otherwise by reason of the fact that Indemnitee is or was a director, officer, trustee,
administrator, partner, member, fiduciary, employee or agent of the Company, by reason of any
action taken or not taken by him or her while acting as director, officer, trustee, administrator,
partner, member, fiduciary, employee or agent of the Company, or by reason of the fact that he or
she is or was serving at the request of the Company as a director, officer, trustee, administrator,
partner, member, fiduciary, employee or agent of any other Enterprise, in each case whether or not
serving in such capacity at the time any liability or expense is incurred for which
indemnification, reimbursement, or advancement of expenses can be provided under this Agreement.

     3. Indemnity in Third-Party Proceedings. The Company shall indemnify and hold harmless
Indemnitee in accordance with the provisions of this Section 3 if Indemnitee is made, or is
threatened to be made, a party to or a participant in (as a witness or otherwise) any Proceeding,
other than a Proceeding by or in the right of the Company to procure a judgment in its favor.
Pursuant to this Section 3, Indemnitee shall be indemnified and held harmless against all
judgments, fines, penalties, amounts paid in settlement (if such settlement is approved in writing
in advance by the Company, which approval shall not be unreasonably withheld) (including, without
limitation, all interest, assessments and other charges paid or payable in connection with or in
respect of any of the foregoing) (collectively, “Losses”) and Expenses

5

 

actually and reasonably incurred by Indemnitee or on his or her behalf in connection with such
Proceeding or any action, discovery event, claim, issue or matter therein or related thereto, if
Indemnitee acted in good faith, for a purpose which he or she reasonably believed to be in or not
opposed to the best interests of the Company and, in the case of a criminal Proceeding, in
addition, had no reasonable cause to believe that his or her conduct was unlawful.

     4. Indemnity in Proceedings by or in the Right of the Company. The Company shall indemnify
Indemnitee in accordance with the provisions of this Section 4 if Indemnitee is made, or is
threatened to be made, a party to or a participant in (as a witness or otherwise) any Proceeding by
or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 4,
Indemnitee shall be indemnified and held harmless against all Expenses actually and reasonably
incurred by him or her or on his or her behalf in connection with the defense or settlement of such
Proceeding or any action, discovery event, claim, issue or matter therein or related thereto, if
Indemnitee acted in good faith, for a purpose which he or she reasonably believed to be in or not
opposed to the best interests of the Company. No indemnification, however, shall be made under
this Section 4 in respect of any claim, issue or matter as to which Indemnitee shall have been
adjudged to be liable to the Company, unless and only to the extent that the court in which the
Proceeding was brought or, if no Proceeding was brought in a court, any court of competent
jurisdiction, determines upon application that, in view of all the circumstances of the case,
Indemnitee fairly and reasonably is entitled to indemnification for such portion of the Expenses as
the court deems proper.

     5. Indemnification for Expenses Where Indemnitee is Wholly or Partly Successful.
Notwithstanding and in addition to the provisions of Section 3 and 4 of this Agreement, to the
extent that Indemnitee is a party to a Proceeding and is successful, on the merits or otherwise, in
the defense of any claim, issue or matter therein, the Company shall indemnify and hold harmless
Indemnitee against all Expenses actually and reasonably incurred by him or her or on his or her
behalf in connection with such successful defense. For the avoidance of doubt, if Indemnitee is
not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one
or more but not less than all claims, issues or matters in such Proceeding, the Company shall
indemnify Indemnitee against all Expenses actually and reasonably incurred by him or her or on his
or her behalf in connection with each successfully resolved claim, issue or matter. For purposes
of this Section 5, and without limitation, the termination of any claim, issue or matter in such a
Proceeding by withdrawal or dismissal, with or without prejudice, shall be deemed to be a
successful result as to such claim, issue or matter.

     6. Indemnification for Expenses of a Witness. To the extent that Indemnitee is, by reason of
his or her Corporate Status, a witness in or otherwise incurs Expenses in connection with any
Proceeding to which Indemnitee is not a party, he or she shall be indemnified and held harmless by
the Company against all Expenses actually and reasonably incurred by him or her or on his or her
behalf in connection therewith.

     7. Additional Indemnification.

          (a) Notwithstanding any limitation in Sections 3, 4, or 5 hereof or in Section 145 of the DGCL
or other applicable statutory provision, the Company shall

6

 

indemnify Indemnitee to the fullest extent permitted by law if Indemnitee is made, or is
threatened to be made, a party to any Proceeding (including a Proceeding by or in the right of the
Company to procure a judgment in its favor) against all Losses and Expenses actually and reasonably
incurred by Indemnitee in connection with the Proceeding; provided, however, that no
indemnification shall be made under this Section 7(a) on account of Indemnitee’s conduct which
constitutes a breach of Indemnitee’s duty of loyalty to the Company or its investors or is an act
or omission not in good faith or which involves intentional misconduct or a knowing violation of
the law.

          (b) For purposes of Sections 7(a), the meaning of the phrase “to the fullest extent
permitted by law” shall include, but not be limited to:

               (i) to the fullest extent authorized or permitted by the then-applicable provisions of the
DGCL or other applicable statutory provision, that authorize or contemplate indemnification by
agreement, or the corresponding provision of any amendment to or replacement of the DGCL or other
applicable statutory provision, and

               (ii) to the fullest extent authorized or permitted by any amendments to or replacements of the
DGCL or other applicable statutory provision, adopted after the date of this Agreement that
increase the extent to which a corporation limited liability company or partnership, as applicable,
may indemnify its officers, directors or persons holding similar fiduciary responsibilities.

          (c) Indemnitee shall be entitled to the prompt payment of all Expenses reasonably incurred in
enforcing successfully (fully or partially) this Agreement.

     8. Contribution. To the fullest extent permissible under applicable law, if the
indemnification provided for in this Agreement is unavailable to Indemnitee in whole or in part for
any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the
amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid
or to be paid in settlement and/or for Expenses, in connection with any claim relating to an
indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in
light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits
received by the Company, on the one hand, and Indemnitee, on the other, as a result of the event(s)
and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative fault of the
Company, on the one hand (and its directors, officers, employees and agents), and Indemnitee, on
the other, in connection with such event(s) and/or transaction(s).

     9. Exclusions. Notwithstanding any provision in this Agreement, the Company shall not be
obligated under this Agreement to make any indemnity in connection with any claim made against
Indemnitee:

          (a) for which payment actually has been received by or on behalf of Indemnitee under any
insurance policy or other indemnity provision, except with respect to any excess beyond the amount
actually received under such insurance policy or other indemnity provision; or

7

 

          (b) for an accounting of profits made from the purchase and sale (or sale and purchase) by
Indemnitee of securities of the Company or any subsidiary of the Company within the meaning of
Section 16(b) of the Exchange Act, as amended, or similar provisions of state blue sky law, state
statutory law or common law; or

          (c) prior to a Change in Control, in connection with any Proceeding (or any part of any
Proceeding) initiated by Indemnitee, including any Proceeding (or any part of any Proceeding)
initiated by Indemnitee against the Company (other than any Proceeding referred to in Sections
14(d) or (e) below or any other Proceeding commenced to recover any Expenses referred to in Section
7(c) above) or its directors, officers, employees or other indemnitees, unless (i) the Board
authorized the Proceeding (or any part of any Proceeding) prior to its initiation or (ii) the
Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the
Company under applicable law; or

          (d) if the funds at issue were paid pursuant to a settlement approved by a court and
indemnification would be inconsistent with any condition with respect to indemnification expressly
imposed by the court in approving the settlement.

     10. Advances of Expenses; Defense of Claim.

          (a) The Company shall advance pursuant to this Section 10(a) the Expenses incurred by
Indemnitee in connection with any Proceeding within thirty (30) days after the receipt by the
Company of a written statement or statements requesting such advances from time to time, whether
prior to or after final disposition of any Proceeding. Advances shall be unsecured and interest
free. Advances shall be made without regard to Indemnitee’s ability to repay such advances.
Advances shall include any and all reasonable Expenses incurred pursuing an action to enforce such
right to receive advances. Notwithstanding any provision of this Agreement to the contrary, the
Indemnitee shall be entitled to advances of Expenses incurred by him or her or on his or her behalf
in connection with a Proceeding that Indemnitee claims is covered by Sections 3 and 4 hereof, prior
to a final determination of eligibility for indemnification and prior to the final disposition of
the Proceeding, upon the execution and delivery to the Company of an undertaking by or on behalf of
the Indemnitee providing that the Indemnitee will repay such advances to the extent that it
ultimately is determined that Indemnitee is not entitled to be indemnified by the Company. This
Section 10(a) shall not apply to any claim made by Indemnitee for which indemnity is excluded
pursuant to Section 9.

          (b) The Company will be entitled to participate in the Proceeding at its own expense.

          (c) The Company shall not settle any action, claim or Proceeding (in whole or in part) which
would impose any Expense, judgment, fine, penalty or limitation on the Indemnitee without the
Indemnitee’s prior written consent, which consent shall not be unreasonably withheld.

8

 

     11. Procedure for Notification and Application for Indemnification.

          (a) Within sixty (60) days after the actual receipt by Indemnitee of written notice that he or
she is a party to or is requested to be a participant in (as a witness or otherwise) any
Proceeding, Indemnitee shall submit to the Company a written notice identifying the Proceeding.
The failure by the Indemnitee to notify the Company within such 60-day period will not relieve the
Company from any liability which it may have to Indemnitee (i) other than under this Agreement, and
(ii) under this Agreement, provided that if the Company can establish that such failure to notify
the Company in a timely manner resulted in actual prejudice to the Company, then the Company will
be relieved from liability under this Agreement only to the extent of such actual prejudice.

          (b) Indemnitee shall at the time of giving such notice pursuant to Section 11(a) or thereafter
deliver to the Company a written application for indemnification. Such application may be
delivered at such time as Indemnitee deems appropriate in his or her sole discretion. Following
delivery of such a written application for indemnification by Indemnitee, the Indemnitee’s
entitlement to indemnification shall be determined promptly according to Section 12(a) of this
Agreement and the outcome of such determination shall be reported to Indemnitee in writing within
forty-five (45) days of the submission of such application.

     12. Procedure Upon Application for Indemnification.

          (a) Upon written application by Indemnitee for indemnification pursuant to Section 11(b) or
written statement by Indemnitee for advances of Expenses pursuant to Section 10(a), a determination
with respect to Indemnitee’s entitlement thereto pursuant to the mandatory terms of this Agreement,
pursuant to statute, or pursuant to other sources of right to indemnity, shall be made in the
specific case: (i) by a majority vote of the Disinterested Directors, whether or not such directors
otherwise would constitute a quorum of the Board; (ii) by a committee of Disinterested Directors
designated by a majority vote of such directors, whether or not such directors would otherwise
constitute a quorum of the Board, (iii) if there are no Disinterested Directors, by Independent
Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee or (iv)
by the stockholders of the Company. Indemnitee shall reasonably cooperate with the person, persons
or entity making the determination with respect to Indemnitee’s entitlement to indemnification,
including providing to such person, persons or entity upon reasonable advance request any
documentation or information which is not privileged or otherwise protected from disclosure and
which is reasonably available to Indemnitee and reasonably necessary to such determination. Any
costs or Expenses (including attorneys’ fees and disbursements) incurred by Indemnitee in so
cooperating with the person, persons or entity making such determination shall be borne by the
Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and
the Company hereby indemnifies and agrees to hold Indemnitee harmless from any such costs and
Expenses.

9

 

          (b) If it is determined that Indemnitee is entitled to the indemnification requested by the
Indemnitee in a written application submitted to the Company pursuant to Section 11(b), payment to
Indemnitee shall be made within ten (10) days after such determination. All advances of Expenses
requested in a written statement by Indemnitee pursuant to Section 10(a) prior to a final
determination of eligibility for indemnification shall be paid in accordance with Section 10.

          (c) In the event the determination of entitlement to indemnification or advancement of
Expenses is to be made by Independent Counsel pursuant to Section 12(a) hereof, the Independent
Counsel shall be selected as provided in this Section 12(c). If a Change in Control shall not have
occurred, the Independent Counsel shall be selected by the Board, and the Company shall give
written notice to Indemnitee advising him or her of the identity of the Independent Counsel so
selected. If a Change in Control shall have occurred, the Independent Counsel shall be selected by
Indemnitee (unless Indemnitee shall request that such selection be made by the Board, in which
event the preceding sentence shall apply), and Indemnitee shall give written notice to the Company
advising it of the identity of the Independent Counsel so selected. In either event, Indemnitee or
the Company, as the case may be, may, within ten (10) days after such written notice of selection
shall have been received, deliver to the Company or to Indemnitee, as the case may be, a written
objection to such selection; provided, however, that such objection may be asserted only on the
ground that the Independent Counsel so selected does not meet the requirements of “Independent
Counsel” as defined in Section 2 of this Agreement, and the objection shall set forth with
particularity the factual basis of such assertion. Absent a proper and timely objection, the
person so selected shall act as Independent Counsel. If a written objection is made and
substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and
until such objection is withdrawn or a court of competent jurisdiction has determined that such
objection is without merit. If, within twenty (20) days after submission by Indemnitee of a
written request for advancement of Expenses or indemnification pursuant to Section 10(a) or 11(b)
hereof, no Independent Counsel shall have been selected and not objected to, either the Company or
Indemnitee may petition a court of competent jurisdiction for resolution of any objection which
shall have been made by the Company or Indemnitee to the other’s selection of Independent Counsel
and/or for the appointment as Independent Counsel of a person selected by the court or by such
other person as the court shall designate, and the person with respect to whom all objections are
so resolved or the person so appointed shall act as Independent Counsel under Section 12(a) hereof.

          (d) The Company shall pay the reasonable fees and expenses of the Independent Counsel and to
fully indemnify such Independent Counsel against any and all Expenses, claims, liabilities and
damages arising out of or relating to this Agreement or its engagement pursuant hereto.

          (e) Upon the due commencement of any judicial proceeding or arbitration pursuant to Section
14(a) of this Agreement, any Independent Counsel shall be discharged and relieved of any further
responsibility in such capacity (subject to the applicable standards of professional conduct then
prevailing).

10

 

     13. Presumptions and Effect of Certain Proceedings.

          (a) Presumption in Favor of Indemnitee. In making a determination with respect to
entitlement to indemnification or advancement of Expenses hereunder, the person or persons or
entity making such determination shall presume that Indemnitee is entitled to indemnification or
advancement of Expenses under this Agreement if Indemnitee has submitted an application for
advancement of Expenses in accordance with Section 10(a) of this Agreement or indemnification in
accordance with Section 11(b) of this Agreement, and the Company shall have the burden of proof to
overcome that presumption.

          (b) No Presumption Against Indemnitee. Neither the failure of the Company (including
by its directors or Independent Counsel) to have made a determination prior to the commencement of
any action pursuant to this Agreement nor an actual determination by the Company (including by its
directors or Independent Counsel) that Indemnitee has not met the applicable standard of conduct
for indemnification shall be a defense to the action or create a presumption that Indemnitee has
not met the applicable standard of conduct.

          (c) Sixty Day Period for Determination. If the person, persons or entity empowered or
selected under Section 12 of this Agreement to determine whether Indemnitee is entitled to
indemnification or advancement of Expenses shall not have made a determination within sixty (60)
days after receipt by the Company of an application therefor, a determination of entitlement to
indemnification or advancement of Expenses shall be deemed to have been made and Indemnitee shall
be entitled to such indemnification, absent (i) a misstatement by Indemnitee of a material fact, or
an omission of a material fact necessary to make Indemnitee’s statement not materially misleading,
in connection with the application for indemnification or advancement of Expenses, or (ii) a
prohibition of such indemnification under applicable law; provided, however, that such 60-day
period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if the
person, persons or entity making the determination with respect to entitlement to indemnification
in good faith requires such additional time for the obtaining or evaluating of documentation and/or
information relating thereto.

          (d) No Presumption from Termination of a Proceeding. The termination of any
Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction,
or upon a plea of nolo contendere, or its equivalent, shall not of itself adversely affect the
right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good
faith and for a purpose which he or she reasonably believed to be in or not opposed to the best
interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had
reasonable cause to believe that his or her conduct was unlawful.

          (e) Reliance as Safe Harbor. For purposes of any determination of good faith,
Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action or failure to act is
based on the records or books of account of the Company or any

11

 

Enterprise other than the Company, including financial statements, or on information supplied
to Indemnitee by the officers of the Company or any Enterprise other than the Company in the course
of their duties, or on the advice of legal counsel for the Company or any Enterprise other than the
Company or on information or records given or reports made to the Company or any Enterprise other
than the Company by an independent certified public accountant or by an appraiser or other expert
selected by the Company or any Enterprise other than the Company, except if the Indemnitee knew or
had reason to know that such records or books of account of the Company, information supplied by
the officers of the Company, advice of legal counsel or information or records given or reports
made by an independent certified public accountant or by an appraiser or other expert were
materially false or materially inaccurate. The provisions of this Section 13(e) shall not be
deemed to be exclusive or to limit in any way the other circumstances in which the Indemnitee may
be deemed or found to have met any applicable standard of conduct.

          (f) Actions of Others. The knowledge and/or actions, or failure to act, of any other
director, officer, trustee, administrator, partner, member, fiduciary, employee or agent of the
Company or any Enterprise other than the Company shall not be imputed to Indemnitee for purposes of
determining the right to indemnification under this Agreement.

     14. Remedies of Indemnitee.

          (a) Adjudication/Arbitration. In the event that (i) a determination is made pursuant
to Section 12 of this Agreement that Indemnitee is not entitled to indemnification under this
Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 10 of this
Agreement, (iii) subject to Section 13(c), no determination of entitlement to indemnification shall
have been made pursuant to Section 12(a) of this Agreement within 60 days after receipt by the
Company of the application for indemnification, or (iv) payment of indemnification is not made
pursuant to Sections 3, 4, 5, 6, 7 and 12(b) of this Agreement within ten (10) days after a
determination has been made that Indemnitee is entitled to indemnification, or after receipt by the
Company of a written request for any additional monies owed with respect to a Proceeding as to
which it already has been determined that Indemnitee is entitled to indemnification, Indemnitee
shall be entitled to an adjudication by a court of his or her entitlement to such indemnification
or advancement of Expenses. Alternatively, Indemnitee, at his or her option, may seek an award in
arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of
the American Arbitration Association. The Company shall not oppose Indemnitee’s right to seek any
such adjudication or award in arbitration.

          (b) Indemnitee Not Prejudiced by Prior Adverse Determination. In the event that a
determination shall have been made pursuant to Section 12(a) of this Agreement that Indemnitee is
not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this
Section 14 shall be conducted in all respects as a de novo trial, or arbitration, on the
merits, and Indemnitee shall not be prejudiced by

12

 

reason of the prior adverse determination. In any judicial proceeding or arbitration
commenced pursuant to this Section 14, the Company shall have the burden of proving Indemnitee is
not entitled to indemnification or advancement of Expenses, as the case may be.

          (c) Company Bound by Prior Determination. If a determination shall have been made
pursuant to Section 12(a) of this Agreement that Indemnitee is entitled to indemnification, the
Company shall be bound by such determination in any judicial proceeding or arbitration commenced
pursuant to this Section 14, absent (i) a misstatement by Indemnitee of a material fact, or an
omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in
connection with the application for indemnification, or (ii) a prohibition of such indemnification
under applicable law.

          (d) Expenses. In the event that Indemnitee, pursuant to this Section 14, seeks a
judicial adjudication of or an award in arbitration to enforce his or her rights under, or to
recover damages for breach of, this Agreement, Indemnitee shall be entitled to recover from the
Company, and shall be jointly and severally indemnified by the Company against, any and all
Expenses actually and reasonably incurred by him or her in such judicial adjudication or
arbitration if it shall be determined in such judicial adjudication or arbitration that Indemnitee
is entitled to receive all or part of the indemnification or advancement of Expenses sought which
the Company had disputed prior to the commencement of the judicial proceeding or arbitration.

          (e) Advances of Expenses. If requested by Indemnitee, the Company shall (within ten
(10) days after receipt by the Company of a written request therefore) advance to Indemnitee the
Expenses which are incurred by Indemnitee in connection with any judicial proceeding or arbitration
brought by Indemnitee for indemnification or advance of Expenses from the Company under this
Agreement or under any directors’ and officers’ liability insurance policies maintained by the
Company, if the Indemnitee has submitted an undertaking to repay such Expenses if Indemnitee
ultimately is determined to not be entitled to such indemnification, advancement of Expenses or
insurance recovery, as the case may be. The Indemnitee’s financial ability to repay any such
advances shall not be a basis for the Company to decline to make such advances.

          (f) Precluded Assertions by the Company. The Company shall be precluded from
asserting in any judicial proceeding or arbitration commenced pursuant to this Section 14 that the
procedures and presumptions of this Agreement are not valid, binding and enforceable and shall
stipulate in any such court or before any such arbitrator that the Company is bound by all the
provisions of this Agreement.

     15. Non-exclusivity; Survival of Rights; Insurance; Subrogation.

          (a) Rights of Indemnitee Not Exclusive. The rights of indemnification and to receive
advancement of Expenses as provided by this Agreement shall not be deemed exclusive of any other
rights to which Indemnitee may at any time be entitled

13

 

under applicable law, the Certificate of Incorporation, or the By-Laws, any agreement, vote of
investors or a resolution of directors, members, partners, or otherwise. No right or remedy herein
conferred by this Agreement is intended to be exclusive of any other right or remedy, and every
other right and remedy shall be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent or
subsequent assertion or employment of any other right or remedy.

          (b) Survival of Rights. No amendment, alteration or repeal of this Agreement or of
any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in
respect of any action taken or omitted by such Indemnitee in his or her Corporate Status prior to
such amendment, alteration or repeal.

          (c) Change of Law. To the extent that a change in Delaware law, whether by statute or
judicial decision, permits greater indemnification or advancement of Expenses than would be
afforded currently under the Certificate of Incorporation or the By-Laws, or this Agreement, it is
the intent of the parties hereto that Indemnitee shall enjoy and be conferred by this Agreement the
greater benefits so afforded by such change.

          (d) Insurance. To the extent that the Company maintains an insurance policy or
policies providing liability insurance for directors, officers, trustees, administrators partners,
members, fiduciaries, employees, or agents of the Company or of any other Enterprise which such
person serves at the request of the Company, Indemnitee shall be covered by such policy or policies
in accordance with its or their terms to the maximum extent of the coverage available for any such
director, trustee, partner, member, fiduciary, officer, employee or agent under such policy or
policies. If, at the time the Company receives notice from any source of a Proceeding as to which
Indemnitee is a party or a participant (as a witness or otherwise) the Company has director and
officer liability insurance in effect that covers Indemnitee, the Company shall give prompt notice
of such Proceeding to the insurers in accordance with the procedures set forth in the respective
policies. The Company shall thereafter take all necessary or desirable action to cause such
insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such Proceeding in
accordance with the terms of such policies.

          (e) Subrogation. In the event of any payment under this Agreement, the Company, shall
be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who
shall execute all papers required and take all action necessary to secure such rights, including
execution of such documents as are necessary to enable the Company to bring suit to enforce such
rights.

          (f) Other Payments. The Company shall not be liable under this Agreement to make any
payment of amounts otherwise indemnifiable (or for which advancement is provided hereunder) if and
to the extent that Indemnitee has otherwise

14

 

actually received such payment under any insurance policy, contract, agreement or otherwise.

          (g) Other Indemnification. The Company’s obligation to indemnify or advance Expenses
hereunder to Indemnitee who is or was serving at the request of the Company as a director, officer,
trustee, administrator partner, member, fiduciary, employee or agent of any other Enterprise shall
be reduced by any amount Indemnitee has actually received as indemnification or advancement of
expenses from such Enterprise.

     16. Duration of Agreement. This Agreement shall continue until and terminate upon the later
of: (a) ten (10) years after the date that Indemnitee shall have ceased to serve as any of the
following: a director, officer, agent or employee of the Company or as a director, officer,
trustee, administrator partner, member, fiduciary, employee or agent of any other corporation,
partnership, joint venture, trust, employee benefit plan or other Enterprise which Indemnitee
served at the request of the Company; or (b) one (1) year after the final termination of any
Proceeding (including after the expiration of any rights of appeal) then pending in respect of
which Indemnitee is granted rights of indemnification or advancement of Expenses hereunder and of
any proceeding commenced by Indemnitee pursuant to Section 14 of this Agreement (including any
rights of appeal of any Proceeding commenced pursuant to Section 14). This Agreement shall be
binding upon the Company and its respective successors and assigns and shall inure to the benefit
of Indemnitee and his or her heirs, executors and administrators.

     17. Severability. If any provision or provisions of this Agreement shall be held to be
invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and
enforceability of the remaining provisions of this Agreement (including, without limitation, each
portion of any Section of this Agreement containing any such provision held to be invalid, illegal
or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be
affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law;
(b) such provision or provisions shall be deemed reformed to the extent necessary to conform to
applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the
fullest extent possible, the provisions of this Agreement (including, without limitation, each
portion of any Section of this Agreement containing any such provision held to be invalid, illegal
or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to
give effect to the intent manifested thereby.

     18. Enforcement.

          (a) The Company expressly confirms and agrees that it has entered into this Agreement and
assumed the obligations imposed on it hereby in order to induce Indemnitee to serve, or to continue
to serve, as a director or officer of the Company, and the Company acknowledges that Indemnitee is
relying upon this Agreement in serving or continuing to serve as a director or officer of the
Company.

          (b) This Agreement constitutes the entire agreement between the parties hereto with respect to
the subject matter hereof and supersedes all prior

15

 

agreements and understandings, oral, written and implied, between the parties hereto with
respect to the subject matter hereof.

     19. Modification and Waiver. No supplement, modification or amendment of this Agreement shall
be binding unless executed in writing by each of the parties hereto. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions
of this Agreement nor shall any waiver constitute a continuing waiver.

     20. Successors and Binding Agreement.

          (a) The Company will require any successor (whether direct or indirect, by purchase, merger,
consolidation, reorganization or otherwise) and any acquiror of all or substantially all of the
business or assets of the Company by agreement in form and substance reasonably satisfactory to
Indemnitee and/or his or her counsel, expressly to assume and agree to perform this Agreement in
the same manner and to the same extent the Company would be required to perform it if no such
succession had taken place.

          (b) This Agreement will be binding upon and inure to the benefit of the Company and any
successor to the Company, including, without limitation, any person acquiring directly or
indirectly all or substantially all of the business or assets of the Company whether by purchase,
merger, consolidation, reorganization or otherwise (and such successor will thereafter be deemed
the “Company” for purposes of this Agreement), but will not otherwise be assignable or delegatable
by the Company.

          (c) This Agreement will inure to the benefit of and be enforceable by the Indemnitee’s
personal or legal representatives, executors, administrators, successors, heirs, distributees,
legatees and other successors.

          (d) This Agreement is personal in nature and neither of the parties hereto will, without the
consent of the other, assign or delegate this Agreement or any rights or obligations hereunder
except as expressly provided in Sections 20(a), (b) and (c). Without limiting the generality or
effect of the foregoing, Indemnitee’s right to receive payments hereunder will not be assignable,
whether by pledge, creation of a security interest or otherwise, other than by a transfer by the
Indemnitee’s will, devise, a grantor’s trust instrument under which the Indemnitee or his estate is
the sole beneficiary, or by the laws of descent and distribution, and, in the event of any
attempted assignment or transfer contrary to this Section 20(d), the Company will have no liability
to pay any amount so attempted to be assigned or transferred.

     21. Notices. All notices, requests, demands and other communications under this Agreement
shall be in writing and shall be deemed to have been duly given if: (i) delivered by hand and
receipted for by the party to whom said notice or other communication shall have been directed, on
the date of such receipt, or (ii) mailed by certified or registered mail with postage prepaid, on
the third business day after the date on which it is so mailed:

16

 

          (a) If to Indemnitee, at the address indicated on the signature page of this Agreement, or
such other address as Indemnitee subsequently shall provide in writing to the Company.

          (b) If to the Company to:

IsoTis, Inc.

2 Goodyear

Suite B

Irvine, California 92618

Attention: Chief Financial Counsel

or to any other address as may have been furnished to Indemnitee in writing by the Company.

     22. Applicable Law and Consent to Jurisdiction. This Agreement and the legal relations among
the parties shall be governed by, and construed and enforced in accordance with, the laws of the
State of Delaware, without regard to its conflict of laws, principles or rules. Except with
respect to any arbitration commenced by Indemnitee pursuant to Section 14 of this Agreement, the
Company and Indemnitee hereby irrevocably and unconditionally (i) agree that any action or
proceeding arising out of or in connection with this Agreement shall be brought only in the
Chancery Court of the State of Delaware (the “Delaware Court”), and not in any other state
or federal court in the United States of America or any court in any other country, (ii) consent to
submit to the exclusive jurisdiction of the Delaware Court for purposes of any action or proceeding
arising out of or in connection with this Agreement, (iii) irrevocably appoint, to the extent such
party is not a resident of the State of Delaware, Corporation Service Company, 2711 Centerville,
Suite 400, Wilmington, New Castle County, Delaware 19805 as its agent in the State of Delaware as
such party’s agent for acceptance of legal process in connection with any such action or proceeding
against such party with the same legal force and validity as if served upon such party personally
within the State of Delaware, (iv) waive any objection to the laying of venue of any such action or
proceeding in the Delaware Court, and (v) waive, and agree not to plead or to make, any claim that
any such action or proceeding brought in the Delaware Court has been brought in an improper or
inconvenient forum.

     23. Identical Counterparts. This Agreement may be executed in one or more counterparts, each
of which shall for all purposes be deemed to be an original but all of which together shall
constitute one and the same Agreement. Only one such counterpart signed by the party against whom
enforceability is sought needs to be produced to evidence the existence of this Agreement.

     24. Miscellaneous. Use of the masculine pronoun shall be deemed to include usage of the
feminine pronoun where appropriate. The headings of the paragraphs of this Agreement are inserted
for convenience only and shall not be deemed to constitute part of this Agreement or to affect the
construction thereof.

[The remainder of this page is intentionally left blank.]

17

 

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

	 	 	 	 	 	 	 	 	 
	ISOTIS, INC.	 	 	 	INDEMNITEE
	 
	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 	 	 
	Name:
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Title:	 	 	 	 	 	Address for Notices to Indemnitee:
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 

18

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}]]