Document:

exv10w3

 

Exhibit 10.3

L. Phillips Brown DVM

1055 Middlebrook Road

Prescott, Arizona 86303

928-776-8633928-710-3973

www.phillbrowndvm@cablone.net

Position: Veterinary Scientific Advisor and Nutritional Consultant

1. Basic Responsibilities:

	 	•	 	Serve as company veterinary spokesperson
	 
	 	•	 	Provide technical support for customer service calls
	 
	 	•	 	Review current company advertising, claims, literature and product labels
	 
	 	•	 	Assist with copy for packaging and ancillary sales literature
	 
	 	•	 	Develop technical sales presentation materials
	 
	 	•	 	Generate PR materials
	 
	 	•	 	Provide input in development of new products
	 
	 	•	 	Monitor pet industry trends, specifically new pet foods and treats
	 
	 	•	 	Author technical and consumer articles for publication
	 
	 	•	 	Attend major trade shows and major sales presentations
	 
	 	•	 	Provide assistance with company website

2. Compensation

	 	•	 	Basic Responsibilities: $1,200.00 per month payable by the 10th
of each month.
	 
	 	•	 	Per Diem: $500.00 per day of active work plus $200.00 per travel day.
Reimbursement of all out-of-pocket expenses within 30 days of receipt of invoice.

3. The Company and the Consultant shall indemnify and hold harmless each other, its officers,
directors, stockholders, attorneys and agents from any damages, costs claims, liabilities or
expenses (including, but not limited to attorneys’ fees and costs) which may be incurred by reason
of any misrepresentation made by the Company, or the Consultant, or otherwise incurred by reason of
activities pursuant to this agreement.

4. The Company and the Consultant, its officers, directors, stockholders, employees, agency,
principals, representatives and affiliates, shall keep confidential, and exercise all reasonable
precautions to keep any Confidential Information, about the Company or relating to any of its
products, services or any phase of its operations, business or financial affairs which is not a
matter of public record, including without limitation, customers, strategies, techniques, know-how,
plans, business methods, technologies, trade secrets, suppliers, recipes, formulae, inventions and
computer programs (“Confidential Information”), that is not generally known to the Company’s
competitors and is valuable, special and unique to the business of the Company.

5. This letter agreement shall be terminated upon a thirty (30) days written notice by either
party, with the exception of paragraphs Four (4), the provisions of which shall survive an
additional twenty-four (24) months from the date of termination.

	 	 	 
	 
	 	 
	 

	 	 
	Barry Schwartz

	 	L. Phillips Brown DVM
	American Pet Company, Inc.
	 	 
	 
	 
	 	 
	 

	 	 
	(Date)

	 	(Date)exv10w4

 

Exhibit 10.4

OFFICE LEASE

between

16501 Ventura, LLC

A California Limited Liability Company

(Landlord)

and

All American Pet Company, Inc.

A New York Corporation

(Tenant)

 

 

TABLE OF CONTENTS

OFFICE LEASE

	 	 	 	 	 	 	 
	Article	 	Title	 	Page
	1

	 	Definitions
	 	 	1	 
	2

	 	Premises
	 	 	3	 
	3

	 	Term
	 	 	3	 
	4

	 	Rental
	 	 	3	 
	5

	 	Security Deposit
	 	 	9	 
	6

	 	Use of Premises
	 	 	9	 
	7

	 	Utilities and Services
	 	 	11	 
	8

	 	Maintenance and Repairs
	 	 	13	 
	9

	 	Alterations, Additions and Improvements
	 	 	13	 
	10

	 	Indemnification and Insurance
	 	 	15	 
	11

	 	Damage or Destruction
	 	 	18	 
	12

	 	Condemnation
	 	 	19	 
	13

	 	Relocation
	 	 	19	 
	14

	 	Assignment and Subletting
	 	 	20	 
	15

	 	Default and Remedies
	 	 	22	 
	16

	 	Attorneys’ Fees; Costs of Suits
	 	 	26	 
	17

	 	Subordination and Attornment
	 	 	26	 
	18

	 	Quiet Enjoyment
	 	 	28	 
	19

	 	Rules and Regulations
	 	 	28	 
	20

	 	Estoppel Certificates
	 	 	28	 
	21

	 	Entry by Landlord
	 	 	29	 
	22

	 	Landlord’s Lease Undertakings-Exculpation from
Personal Liability; Transfer of Landlord’s Interest
	 	 	29	 
	23

	 	Holdover Tenancy
	 	 	30	 
	24

	 	Notices
	 	 	30	 
	25

	 	Brokers
	 	 	30	 
	26

	 	Electronic Services
	 	 	31	 
	27

	 	Parking
	 	 	34	 
	28

	 	Miscellaneous
	 	 	34	 

	 	 	 
	EXHIBITS
	 	 
	 
	 	 
	Exhibit A

	 	Floor Plan
	Exhibit B

	 	Work Letter
	Exhibit C

	 	Rules and Regulations
	Exhibit D

	 	Building Standard Materials

 

 

OFFICE LEASE

     THIS OFFICE LEASE (“Lease”), dated January 14, 2005 is made and entered into by and between
16501 Ventura LLC, a California Limited Liability Company (“Landlord”), All American Pet Company,
Inc. a New York Corporation (“Tenant”).

ARTICLE I — DEFINITIONS

     Unless the context otherwise specifies or requires, the following terms shall have the
meanings specified herein;

     1.01 Building: The term “Building” shall mean that certain office building located at 16501
Ventura Blvd., Encino California 91436 commonly known as “Encino Executive Plaza” together with any
related land, improvements, parking facilities, common areas, driveways, sidewalks and landscaping.

     1.02 Premises. The term “Premises” shall mean Suite 514 in the “Encino Executive Plaza,” as
more particularly outlined on the drawing attached hereto as Exhibit A and incorporated herein by
reference. As used herein, “Premises” shall not include any storage area in the Building, which
shall be leased or rented pursuant to a separate agreement.

     1.03 Rentable Area of the Premises. The term “Rentable Area of the Premises” shall mean
approximately 3,434 rentable square feet, which Landlord and Tenant have stipulated as the Rentable
Areas of the Premises. Tenant acknowledges that the Rentable Areas of the Premises includes the
usable area, without deduction for columns or projections, multiplied by a load factor to reflect a
share of certain areas, which may include lobbies, corridors, mechanical, utility, janitorial,
boiler and service rooms and closets, restrooms and other public common and service areas of the
building or in accordance to the 1996 BOMA Standard of Measurement.

     1.04 Lease Term. The term “Lease Term” shall mean the period between the Commencement Date
and the Expiration Date (as such terms are hereinafter defined), unless sooner terminated as
otherwise provided in this Lease.

     1.05 Commencement Date. Subject to adjustment as provided in Article 3, the term
“Commencement Date” shall mean February 15, 2005, or upon substantial completion of improvements,
whichever is later. Tenant shall have the right to access the Premise 30 days prior to
commencement date to install phones, computers, servers, and furniture.

     1.06 Expiration Date. Subject to adjustment as provided in Article 3, the term “Expiration
Date” shall mean June 14, 2010.

     l.07 Base Monthly Rent. The term “Base Monthly Rent” shall mean as follows:

	 	 	 	 	 
	Months	 	Rent/mo.
	1
	 	$	7,211.40	 
	2-4
	 	Free
	5-9
	 	 	7,211.40	 
	10
	 	 	3,605.70	 

1

 

	 	 	 	 	 
	Months	 	Rent/mo.
	11-12
	 	 	7,211.40	 
	13-16
	 	 	7,427.74	 
	17
	 	 	3,713.87	 
	18-23
	 	 	7,427.74	 
	24
	 	 	3,713.87	 
	25-36
	 	 	7,650.57	 
	37-48
	 	 	7,880.09	 
	49-60
	 	 	8,116.49	 
	61-64
	 	 	8,359.99	 

     l.08 Rent Abatement. Tenant shall have free rent 2nd, 3rd, 4th months and have one-half (1/2)
rent payment for 10th, 17th, 24th months of the Lease Term, as outlined in Section 1.07.

     1.08 Tenant’s Percentage Share. The term “Tenant’s Percentage Share” shall mean One and Eight
Hundred Nineteen Thousandth (1.819) percent with respect to increases in Property Taxes and
Operating Expenses (as such terms are hereinafter defined). Landlord may reasonably re-determine
Tenant’s Percentage Share from time to time to reflect reconfigurations, additions or modifications
to the Building.

     1.09 Security Deposit. The term “Security Deposit” shall equal Eight Thousand Three Hundred
Fifty Nine and 99/100. ($8,359.99)

     1.10 Tenant’s Permitted Use. The term “Tenant’s Permitted Use” shall mean General Office and
no other use.

     1.11 Business Hours. The term “Business Hours” shall mean the hours of 8:00 A.M. to 6:00
P.M., Monday through Friday (federal and state holidays excepted) and 9:00 A.M. to 1:00 P.M. on
Saturday. Holidays are deemed as the following: New Years Day, President’s Day, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day.

     1.12 Landlord’s Address For Notices. The term “Landlord’s Address for Notices” shall mean
Building Office, 16530 Ventura Blvd, Suite 403, Encino, California 91436.

Tenant’s Address for Notices. The term “Tenant’s Address for Notices” shall mean 16501 Ventura
Blvd. Suite 514, Encino California 91436.

     1.14 Broker. GVA DAUM & Jamison Properties, Inc.

     1.16 Tenant’s Parking Stalls. The term “Tenant’s Parking Stalls” shall mean eleven (11)
parking stalls in the Building at the prevailing rate and the prevailing rate for this ten (10)
parking stalls shall not increase by more than Five (5%) Percent per year.

     So long as additional spaces are available, Tenant may rent additional parking spaces at
prevailing rates on a month-to-month basis at the Building and the building located on 16530
Ventura Blvd., Encino, CA 91436. The Prevailing rate for these additional spaces is not subject to
any cap in increases.

2

 

ARTICLE II — PREMISES

     2.01 Lease of Premises. Landlord hereby leases the Premises to Tenant, and Tenant hereby
leases the Premises from Landlord, upon all of the terms, covenants and conditions contained in
this Lease. On the Commencement Date described herein, Landlord shall deliver the Premises to
Tenant in substantial conformance with the Work Letter Agreement attached hereto as Exhibit B.

     2.02 Acceptance of Premises. Prior to Tenant’s taking possession of the Premises, Landlord or
its designee and Tenant will walk the Premises for the purpose of reviewing the condition of the
Premises (and the condition of completion and workmanship of any tenant improvements which Landlord
is required to construct in the Premises pursuant to this Lease); after such review, Tenant shall
execute a Suite Acceptance Letter, in the form of Exhibit E attached hereto, accepting the
Premises. Except as is expressly set forth in this Section 2.02 or the Work Letter Agreement
attached hereto, if any, or as may be expressly set forth in Suite Acceptance Letter, Tenant agrees
to accept the Premises in its “as is” said physical condition subject to punch list items without
any agreements, representations, understandings or obligations on the part of Landlord to perform
any alterations, repairs or improvements (or to provide any allowance for same). In connection
with the foregoing, Landlord shall complete any items set forth on the “punch list” within a
reasonable time of any such walk through of the Premises.

ARTICLE III — TERM

     3.01 Except as otherwise provided in this Lease, the Lease Term shall be for the period
described in Section 1.04 of this Lease, commencing on the Commencement Date described in Section
1.05 of this Lease and ending on the Expiration Date described in Section 1.06 of this Lease;
provided, however, that, if, for any reason, Landlord is unable to deliver possession of the
Premises on the date described in Section 1.05 of this Lease, Landlord shall not be liable for any
damage caused thereby, nor shall the Lease be void or voidable, but, rather, the Lease Term shall
commence upon, and the Commencement Date shall be the date that possession of the Premises is so
tendered to Tenant (except for Tenant-caused delays which shall not be deemed to delay commencement
of the Lease Term), and, unless Landlord elects otherwise, the Expiration Date described in Section
1.06 of this Lease shall be extended by an equal number of days.

ARTICLE IV — RENTAL

4.01 Definitions. As used herein,

          (A) “Base Year” shall mean calendar year 2005.

          (B) “Property Taxes” shall mean the aggregate amount of all real estate taxes, assessments
(whether they be general or special), sewer rents and charges, transit taxes, taxes based upon the
receipt of rent and any other federal, state or local governmental charge, general, special,
ordinary or extraordinary (but not including income or franchise taxes, capital stock, inheritance,
estate, gift, or any other taxes imposed upon or measured by Landlord’s gross income or profits,
unless the same shall be imposed in lieu of real estate taxes or other ad valorem taxes), which
Landlord shall pay or become obligated to pay in connection with the

3

 

Building, or any part thereof. Property Taxes shall also include all fees and costs,
including reasonable attorneys’ fees, appraisals and consultants’ fees, incurred by Landlord in
seeking to obtain a reassessment, reduction of, or a limit on the increase in, any Property Taxes,
regardless of whether any reduction or limitation is obtained. Property Taxes for any calendar
year shall be Property Taxes which are due for payment or paid in such year, rather than Property
Taxes which are assessed or become a lien during such year. Property Taxes shall include any tax,
assessment, levy, imposition or charge imposed upon Landlord and measured by or based in whole or
in part upon the Building or the rents or other income from the Building, to the extent that such
items would be payable if the Building was the only property of Landlord subject to same and the
income received by Landlord from the Building was the only income of Landlord. Property Taxes
shall also include any personal property taxes imposed upon the furniture, fixtures, machinery,
equipment, apparatus, systems and appurtenances of Landlord used in connection with the Building.

          (C) “Operating Expenses” shall mean all reasonable costs, fees, disbursements and expenses
paid or incurred by or on behalf of Landlord in the operation, ownership, maintenance, insurance,
management, replacement and repair of the Building (excluding Property Taxes) including without
limitation:

               (i) Premiums for property, casualty, liability, rent interruption or other commercially
reasonable types of insurance carried by Landlord.

               (ii) Reasonable salaries, wages and other amounts paid or payable for personnel including the
Building manager, superintendent, operation and maintenance staff, and other employees of Landlord
involved in the maintenance and operation of the Building, including contributions and premiums
towards fringe benefits, unemployment, disability and worker’s compensation insurance, pension plan
contributions and similar premiums and contributions and the total charges of any independent
contractors or property managers engaged in the operation, repair, care, maintenance and cleaning
of any portion of the Building.

               (iii) Cleaning expenses, including without limitation janitorial services, window cleaning,
and garbage and refuse removal.

               (iv) Landscaping expenses, including without limitation irrigating, trimming, mowing,
fertilizing, seeding, and replacing plants.

               (v) Heating, ventilating, air conditioning and steam/utilities expenses, including fuel, gas,
electricity, water, sewer, telephone, and other services.

               (vi) Subject to the provisions of Section 4.01(C)(xii) below, the cost of maintaining,
operating, repairing and replacing components of equipment or machinery, including without
limitation heating, refrigeration, ventilation, electrical, plumbing, mechanical, elevator,
escalator, sprinklers, fire/life safety, security and energy management systems, including service
contracts, maintenance contracts, supplies and parts.

               (vii) Other items of repair or maintenance of elements of the Building.

               (viii) The costs of policing, security and supervision of the Building.

4

 

               (ix) Fair market rental and other costs with respect to the management office for the
Building.

               (x) The cost of the rental of any machinery or equipment and the cost of supplies used in the
maintenance and operation of the Building.

               (xi) Audit fees and the cost of accounting services incurred in the preparation of statements
referred to in this Lease and financial statements, and in the computation of the rents and charges
payable by tenants of the Building.

               (xii) Capital expenditures (a) made primarily to reduce Operating Expenses, or to comply with
any laws or other governmental requirements, or (b) for replacements (as opposed to additions or
new improvements) of non-structural items located in the common areas of the property required to
keep such areas in good condition; provided, all such permitted capital expenditures (together with
reasonable financing charges) shall be amortized for purposes of this Lease over the shorter of (i)
their useful lives, (ii) the period during which the reasonably estimated savings in Operating
Expenses equals the expenditures, or (iii) three (3) years.

               (xiii) Reasonable legal fees and expenses.

               (xiv) Payments under any easement, operating agreement, declaration, restrictive covenant, or
instrument pertaining to the sharing of costs in any planned development.

               (xv) A fee for the administration and management of the Building as commercially reasonably
determined by Landlord from time to time.

     Operating Expenses shall not include costs of alteration of the premises of tenants of the
Building, depreciation charges, interest and principal payments on mortgages, ground rental
payments, real estate brokerage and leasing commissions, expenses incurred in enforcing obligations
of tenants of the Building, salaries and other compensation of executive officers of the managing
agent of the Building senior to the Building manager, costs of any special service provided to any
one tenant of the Building but not to tenants of the Building generally, and costs of marketing or
advertising the Building.

          (D) If the Building does not have ninety five percent (95%) occupancy during an entire
calendar year, including the Base Year, then the variable cost component of “Property Taxes” and
“Operating Expenses” shall be equitably adjusted so that the total amount of Property Taxes and
Operating Expenses equals the total amount which would have been paid or incurred by Landlord had
the Building been ninety five percent (95%) occupied for the entire calendar year. In no event
shall Landlord be entitled to receive from Tenant and any other tenants in the Building an
aggregate amount in excess of actual Property Taxes and Operating Expenses as a result of the
foregoing provision. Operating expenses shall not increase by more than 5% per year.

5

 

     4.02 Base Rent.

          (A) During the Lease Term, Tenant shall pay to Landlord as rental for the Premises the Base
Rent described in Section 1.07 above, subject to the following annual adjustments (herein called
the “Rent Adjustments”):

          (B) Annual Adjustments of Base Rent. (see Section 1.07)

          (a) Tax and Operating Expense Adjustment. During each calendar year, the Base Rent payable by
Tenant to Landlord, shall be increased by (collectively, the “Tax and Operating Expense
Adjustment”): (i) Tenant’s Percentage Share of the dollar increase, if any, in Property Taxes for
such year over Property Taxes for the Base Year; and (ii) Tenant’s Percentage Share of the dollar
increase, if any, in any category of Operating Expenses paid or incurred by Landlord during such
year over the respective category of Operating Expenses paid or incurred by Landlord during the
Base Year. A decrease in Property Taxes or any category of Operating Expenses below the Base Year
amounts shall not decrease the amount of the Base Rent due hereunder or give rise to a credit in
favor of Tenant.

     4.03 Tax and Operating Expense Adjustment Procedure; Estimates. The Tax and Operating Expense
Adjustment specified in Section 4.02(B)(a) shall be determined and paid as follows:

          (A) During each calendar year subsequent to the Base Year, Landlord shall give Tenant written
notice of its estimate of any increased amounts payable under Section 4.02(B)(a) for that calendar
year. On or before the first day of each calendar month during the calendar year, Tenant shall pay
to Landlord one-twelfth (1/12th) of such estimated amounts; provided, however, that, not more often
than quarterly, Landlord may, by written notice to Tenant, revise its estimate for such year, and
subsequent payments by Tenant for such year shall be based upon such revised estimate.

          (B) Within one hundred twenty (120) days after the close of each calendar year or as soon
thereafter as is practicable, Landlord shall deliver to Tenant a statement of that year’s Property
Taxes and Operating Expenses, and the actual Tax and Operating Expense Adjustment to be made
pursuant to Section 4.02(B)(a) for such calendar year, as determined by Landlord (the “Landlord’s
Statement”) and such Landlord’s Statement shall be binding upon Tenant, except as provided in
Section 4.04 below. If the amount of the actual Tax and Operating Expense Adjustment is more than
the estimated payments for such calendar year made by Tenant, Tenant shall pay the deficiency to
Landlord upon receipt of Landlord’s Statement. If the amount of the actual Tax and Operating
Expense Adjustment is less than the estimated payments for such calendar year made by Tenant, any
excess shall be credited against Rent (as hereinafter defined) next payable by Tenant under this
Lease or, if the Lease Term has expired, any excess shall be paid to Tenant. No delay in providing
the statement described in this subparagraph (B) shall act as a waiver of Landlord’s right to
payment under Section 4.02(B)(a) above.

          (C) If this Lease shall terminate on a day other than the end of a calendar year, the amount
of the Tax and Operating Expense Adjustment to be paid pursuant to Section 4.02(B)(a) that is
applicable to the calendar year in which such termination occurs shall be

6

 

prorated on the basis of the number of days from January 1 of the calendar year to the
termination date bears to 365. The termination of this Lease shall not affect the obligations of
Landlord and Tenant pursuant to Section 4.03(B) to be performed after such termination.

     4.04 Review of Landlord’s Statement. Provided that Tenant is not then in default beyond any
applicable cure period of its obligations to pay Base Rent, additional rent described in Section
4.02(B), or any other payments required to be made by it under this Lease and provided further that
Tenant strictly complies with the provisions of this Section 4.04, Tenant shall have the right,
once each calendar year, to reasonably review supporting data for any portion of a Landlord’s
Statement (provided, however, Tenant may not have an audit right to all documentation relating to
Building operations as this would far exceed the relevant information necessary to properly
document a pass-through billing statement, but real estate tax statements, and information on
utilities, repairs, maintenance and insurance will be available), in accordance with the following
procedure:

          (A) Tenant shall, within ten (10) business days after any such Landlord’s Statement is
delivered, deliver a written notice to Landlord specifying the portions of the Landlord’s Statement
that are claimed to be incorrect, and Tenant shall simultaneously pay to Landlord all amounts due
from Tenant to Landlord as specified in the Landlord’s Statement. Except as expressly set forth in
subsection (C) below, in no event shall Tenant be entitled to withhold, deduct, or offset any
monetary obligation of Tenant to Landlord under the Lease (including, without limitation, Tenant’s
obligation to make all payments of Base Rent and all payments of Tenant’s Tax and Operating Expense
Adjustment) pending the completion of and regardless of the results of any review of records under
this Section 4.04. The right of Tenant under this Section 4.04 may only be exercised once for any
Landlord’s Statement, and if Tenant fails to meet any of the above conditions as a prerequisite to
the exercise of such right, the right of Tenant under this Section 4.04 for a particular Landlord’s
Statement shall be deemed waived.

          (B) Tenant acknowledges that Landlord maintains its records for the Building at Landlord’s
manager’s corporate offices presently located at the address set forth in Section 1.12 and Tenant
agrees that any review of records under this Section 4.04 shall be at the sole expense of Tenant
and shall be conducted by an independent firm of certified public accountants of national standing.
Tenant acknowledges and agrees that any records reviewed under this Section 4.04 constitute
confidential information of Landlord, which shall not be disclosed to anyone other than the
accountants performing the review and the principals of Tenant who receive the results of the
review. The willful disclosure of such information to any other person, whether or not caused by
the conduct of Tenant, shall constitute a material breach of this Lease.

          (C) Any errors disclosed by the review shall be promptly corrected by Landlord, provided,
however, that if Landlord disagrees with any such claimed errors, Landlord shall have the right to
cause another review to be made by an independent firm of certified public accountants of national
standing. In the event of a disagreement between the two accounting firms, the review that
discloses the least amount of deviation from the Landlord’s Statement shall be deemed to be
correct. In the event that the results of the review of records (taking into account, if
applicable, the results of any additional review caused by Landlord) reveal that Tenant has
overpaid obligations for a preceding period, the amount of such overpayment shall be credited
against Tenant’s subsequent installment obligations to pay the estimated Tax and

7

 

Operating Expense Adjustment. In the event that such results show that Tenant has underpaid
its obligations for a preceding period, Tenant shall be liable for Landlord’s actual accounting
fees, and the amount of such underpayment shall be paid by Tenant to Landlord with the next
succeeding installment obligation of estimated Tax and Operating Expense Adjustment.

     4.05 Payment. Concurrently with the execution hereof, Tenant shall pay Landlord Base Rent for
the first calendar month of the Lease Term. Thereafter the Base Rent described in Section 1.07, as
adjusted in accordance with Section 4.02, shall be payable in advance on the first day of each
calendar month. If the Commencement Date is other than the first day of a calendar month, the
prepaid Base Rent for such partial month shall be prorated in the proportion that the number of
days this Lease is in effect during such partial month bears to the total number of days in the
calendar month. All Rent, and all other amounts payable to Landlord by Tenant pursuant to the
provisions of this Lease, shall be paid to Landlord, without notice, demand, abatement, deduction
or offset, in lawful money of the United States at Landlord’s office in the Building or to such
other person or at such other place as Landlord may designate from time to time by written notice
given to Tenant. No payment by Tenant or receipt by Landlord of a lesser amount than the correct
Rent due hereunder shall be deemed to be other than a payment on account; nor shall any endorsement
or statement on any check or any letter accompanying any check or payment be deemed to effect or
evidence an accord and satisfaction; and Landlord may accept such check or payment without
prejudice to Landlord’s right to recover the balance or pursue any other remedy in this Lease or at
law or in equity provided.

     4.06 Late Charge; Interest. Tenant acknowledges that the late payment of Base Rent or any
other amounts payable by Tenant to Landlord hereunder (all of which shall constitute additional
rental to the same extent as Base Rent) will cause Landlord to incur administrative costs and other
damages, the exact amount of which would be impracticable or extremely difficult to ascertain.
Landlord and Tenant agree that if Landlord does not receive any such payment on or before ten (10)
days after the date the payment is due, Tenant shall pay to Landlord, as additional rent, (a) a
late charge equal to five percent (5%) of the overdue amount to cover such additional
administrative costs; and (b) interest on the delinquent amounts at the lesser of the maximum rate
permitted by law if any or eight percent (8%) per annum from the date due to the date paid.

     4.07 Additional Rent. For purposes of this Lease, all amounts payable by Tenant to Landlord
pursuant to this Lease, whether or not denominated as such, shall constitute Base Rent. Any
amounts due Landlord shall sometimes be referred to in this Lease as “Rent”.

     4.08 Additional Taxes. Notwithstanding anything in Section 4.01(B) to the contrary, Tenant
shall reimburse Landlord upon demand for any and all taxes payable by or imposed upon Landlord upon
or with respect to: any fixtures or personal property located in the Premises; any leasehold
improvements made in or to the Premises by or for Tenant; the Rent payable hereunder, including,
without limitation, any gross receipts tax, license fee or excise tax levied by any governmental
authority; the possession, leasing, operation, management, maintenance, alteration, repair, use or
occupancy of any portion of the Premises (including without limitation any applicable possessory
interest taxes); or this transaction or any document to which Tenant is a party creating or
transferring an interest or an estate in the Premises.

8

 

ARTICLE V — SECURITY DEPOSIT

     5.01 Upon the execution of this Lease, Tenant shall deposit with Landlord the Security Deposit
described in Section 1.09 above. The Security Deposit is made by Tenant to secure the faithful
performance of all the terms, covenants and conditions of this Lease to be performed by Tenant. If
Tenant shall default with respect to any covenant or provision hereof after notice and beyond the
expiration of any applicable cure period, Landlord may use, apply or retain all or any portion of
the Security Deposit to cure such default or to compensate Landlord for any loss or damage which
Landlord may suffer thereby. If Landlord so uses or applies all or any portion of the Security
Deposit, Tenant shall immediately upon written demand by landlord deposit cash with Landlord in an
amount sufficient to restore the Security Deposit to the full amount hereinabove stated. Landlord
shall not be required to keep the Security Deposit separate from its general accounts and Tenant
shall not be entitled to interest on the Security Deposit. Within thirty (30) days after the
expiration of the Lease Term and the vacation of the Premises by Tenant, the Security Deposit, or
such part as has not been applied to cure the default, shall be returned to Tenant.

ARTICLE VI — USE OF PREMISES

     6.01 Tenant’s Permitted Use. Tenant shall use the Premises only for Tenant’s Permitted Use as
set forth in Section 1.10 above and shall not use or permit the Premises to be used for any other
purpose. Tenant shall, at its sole cost and expense, obtain all governmental licenses and permits
required to allow Tenant to conduct Tenant’s Permitted Use. Landlord disclaims any warranty that
the Premises are suitable for Tenant’s use and Tenant acknowledges that it has had a full
opportunity to make its own determination in this regard. Landlord represents that the Building in
which the premises forms a part has a Certificate of Occupancy for use thereof as an office
building.

     6.02 Compliance With Laws and Other Requirements.

          (A) Tenant shall cause the Premises to comply in all material respects with all laws,
ordinances, regulations and directives of any governmental authority having jurisdiction including,
without limitation, any certificate of occupancy and any law, ordinance, regulation, covenant,
condition or restriction affecting the Building or the Premises which in the future may become
applicable to the Premises (collectively “Applicable Laws”).

          (B) Tenant shall not use the Premises, or permit the Premises to be used, in any manner which
as a result of the Tenant’s particular manner of use thereof: (a) violates any Applicable Law; (b)
causes or is reasonably likely to cause damage to the Building or the Premises; (c) violates a
requirement or condition of any fire and extended insurance policy covering the Building and/or the
Premises, or increases the cost of such policy; (d) constitutes or is reasonably likely to
constitute a nuisance, annoyance or inconvenience to other tenants or occupants of the Building or
its equipment, facilities or systems; (e) interferes with, or is reasonably likely to interfere
with, the transmission or reception of microwave, television, radio, telephone or other
communication signals by antennae or other facilities located in the Building; or (f) violates the
Rules and Regulations described in Article XIX.

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     6.03 Hazardous Materials.

          (A) No Hazardous Materials, as defined herein, shall be Handled, as also defined herein, upon,
about, above or beneath the Premises or any portion of the Building by or on behalf of Tenant, its
subtenants or its assignees, or their respective contractors, clients, officers, directors,
employees, agents, or invitees. Any such Hazardous Materials so Handled shall be known as Tenant’s
Hazardous Materials. Notwithstanding the foregoing, normal quantities of Tenant’s Hazardous
Materials customarily used in the conduct of general administrative and executive office activities
(e.g., copier fluids and cleaning supplies) may be Handled at the Premises without Landlord’s prior
written consent. Tenant’s Hazardous Materials shall be Handled at all times in compliance with the
manufacturer’s instructions therefore and all applicable Environmental Laws, as defined herein.

          (B) Notwithstanding the obligation of Tenant to indemnify Landlord pursuant to this Lease,
Tenant shall, at its sole cost and expense, promptly take all actions required by any Regulatory
Authority, as defined herein, or necessary for Landlord to make full economic use of the Premises
or any portion of the Building, which requirements or necessity arises from the Handling of
Tenant’s Hazardous Materials upon, about, above or beneath the Premises or any portion of the
Building. Such actions shall include, but not be limited to, the investigation of the
environmental condition of the Premises or any portion of the Building, the preparation of any
feasibility studies or reports and the performance of any cleanup, remedial, removal or restoration
work. Tenant shall take all actions necessary to restore the Premises or any portion of the
Building to the condition existing prior to the introduction of Tenant’s Hazardous Materials,
notwithstanding any less stringent standards or remediation allowable under applicable
Environmental Laws. Tenant shall nevertheless obtain Landlord’s written approval prior to
undertaking any actions required by this Section, which approval shall not be unreasonably withheld
so long as such actions would not potentially have a material adverse long-term or short-term
effect on the Premises or any portion of the Building.

          (C) Tenant agrees to execute affidavits, representations, and the like from time to time at
Landlord’s request stating Tenant’s best knowledge and belief regarding the presence of Hazardous
Materials on the Premises.

          (D) “Environmental Laws” means and includes all now and hereafter existing statutes, laws,
ordinances, codes, regulations, rules, rulings, orders, decrees, directives, policies and
requirements by any Regulatory Authority regulating, relating to, or imposing liability or
standards of conduct concerning public health and safety or the environment.

          (E) “Hazardous Materials” means: (a) any material or substance: (i) which is defined or
becomes defined as a “hazardous substance,” “hazardous waste,” “infectious waste,” “chemical
mixture or substance,” or “air pollutant” under Environmental Laws; (ii) containing petroleum,
crude oil or any fraction thereof; (iii) containing polychlorinated biphenyls (PCB’s); (iv)
containing asbestos; (v) which is radioactive; (vi) which is infectious; or (b) any other material
or substance displaying toxic, reactive, ignitable or corrosive characteristics, as all such terms
are used in their broadest sense, and are defined, or become defined by Environmental Laws; or (c)
materials which cause a nuisance upon or waste to the Premises or any portion of the Building.

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          (F) “Handle,” “handle,” “Handled,” “handled,” “Handling,” or “handling” shall mean any
installation, handling, generation, storage, treatment, use, disposal, discharge, release,
manufacture, refinement, presence, migration, emission, abatement, removal, transportation, or any
other activity of any type in connection with or involving Hazardous Materials.

          (G) “Regulatory Authority” shall mean any federal, state or local governmental agency,
commission, board or political subdivision.

ARTICLE VII — UTILITIES AND SERVICES

     7.01 Building Services. Landlord agrees to furnish or cause to be furnished to the Premises
the following utilities and services, subject to the conditions and standards set forth herein:

          (A) Non-attended automatic elevator service (if the Building has such equipment serving the
Premises), in common with Landlord and other tenants and occupants and their agents and invitees.

          (B) During Business Hours, such air conditioning, heating and ventilation as, in Landlord’s
reasonable judgment, are required for the comfortable use and occupancy of the Premises. Landlord
may make available to Tenant heating, ventilation or air conditioning in excess of that which
Landlord shall be required to provide hereunder upon such conditions as shall be determined by
Landlord from time to time. Landlord’s fee for any such additional heating, ventilation or air
conditioning provided to Tenant, to be set by Landlord from time to time, will be separate from and
in addition to the Tax and Operating Expenses Adjustment provide in Article IV. (see Addendum 1)

          (C) Water for drinking and rest room purposes.

          (D) Reasonable janitorial and cleaning services, provided that the Premises are used
exclusively for office purposes and are kept reasonably in order by Tenant. If the Premises are
not used exclusively as offices, Landlord, at Landlord’s sole discretion, may require that the
Premises be kept clean and in order by Tenant, at Tenant’s expense, to the satisfaction of Landlord
and by persons approved by Landlord; and, in all events, Tenant shall pay to Landlord the cost of
removal of Tenant’s refuse and rubbish, to the extent that the same exceeds the refuse and rubbish
attendant to normal office usage.

          (E) At all reasonable times, electric current of not less than 3.5 watts per square foot for
building standard lighting and fractional horsepower office machines; provided, however, that (i)
without Landlord’s consent, Tenant shall not install, or permit the installation, in the Premises
of any computers, word processors, electronic data processing equipment or other type of equipment
or machines which will increase Tenant’s use of electric current in excess of that which Landlord
is obligated to provide hereunder (provided, however, that the foregoing shall not preclude the use
of personal computers or similar office equipment); (ii) if Tenant shall require electric current
which may disrupt the provision of electrical service to other tenants, Landlord may refuse to
grant its consent or may condition its consent upon Tenant’s payment of the cost of installing and
providing any additional facilities required to furnish such

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excess power to the Premises and upon the installation in the Premises of electric current
meters to measure the amount of electric current consumed, in which latter event Tenant shall pay
for the cost of such meter(s) and the cost of installation, maintenance and repair thereof, as well
as for all excess electric current consumed at the rates charged by the applicable local public
utility, plus a reasonable amount to cover the additional expenses incurred by Landlord in keeping
account of the electric current so consumed; and (iii) if Tenant’s increased electrical
requirements will materially affect the temperature level in the Premises or the Building,
Landlord’s consent may be conditioned upon Tenant’s requirement to pay such amounts as will be
incurred by Landlord to install and operate any machinery or equipment necessary to restore the
temperature level to that otherwise required to be provided by Landlord, including but not limited
to the cost of modifications to the air conditioning system. Landlord shall not, in any way, be
liable or responsible to Tenant for any loss or damage or expense which Tenant may incur or sustain
if, for any reasons beyond Landlord’s reasonable control, either the quantity or character of
electric service is changed or is no longer available or suitable for Tenant’s requirements.
Tenant covenants that at all times its use of electric current shall never exceed the capacity of
the feeders, risers or electrical installations of the Building. If submetering of electricity in
the Building will not be permitted under future laws or regulations, the Rent will then be
equitably and periodically adjusted to include an additional payment to Landlord reflecting the
cost to Landlord for furnishing electricity to Tenant in the Premises.

     Any amounts which Tenant is required to pay to Landlord pursuant to this Section 7.01 shall be
payable upon demand by Landlord and shall constitute additional rent.

     7.02 Interruption of Services. Landlord shall not be liable for any failure to furnish,
stoppage of, or interruption in furnishing any of the services or utilities described in Section
7.01, except when same is caused by the negligence or willfull misconduct of Landlord, its
employees, agents, servants, and contractors. When such failure is caused by accident, breakage,
repairs, strikes, lockouts, labor disputes, labor disturbances, governmental regulation, civil
disturbances, acts of war, moratorium or other governmental action, or any other cause beyond
Landlord’s reasonable control, and, in such event, Tenant shall not be entitled to any damages nor
shall any failure or interruption abate or suspend Tenant’s obligation to pay Base Rent and
additional rent required under this Lease or constitute or be construed as a constructive or other
eviction of Tenant. Further, in the event any governmental authority or public utility promulgates
or revises any law, ordinance, rule or regulation, or issues mandatory controls or voluntary
controls relating to the use or conservation of energy, water, gas, light or electricity, the
reduction of automobile or other emissions, or the provision of any other utility or service,
Landlord may take any reasonably appropriate action to comply with such law, ordinance, rule,
regulation, mandatory control or voluntary guideline and Tenant’s obligations hereunder shall not
be affected by any such action of Landlord. The parties acknowledge that safety and security
devices, services and programs provided by Landlord, if any, while intended to deter crime and
ensure safety, may not in given instances prevent theft or other criminal acts, or ensure safety of
persons or property. The risk that any safety or security device, service or program may not be
effective, or may malfunction, or be circumvented by a criminal, is assumed by Tenant with respect
to Tenant’s property and interests, and Tenant shall obtain insurance coverage to the extent Tenant
desires protection against such criminal acts and other losses, as further described in this Lease.
Tenant agrees to cooperate in any reasonable safety or security program developed by Landlord or
required by Law.

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ARTICLE VIII — MAINTENANCE AND REPAIRS

     8.01 Landlord’s Obligations. Except as provided in Sections 8.02 and 8.03 below, Landlord
shall maintain the Building and Common Areas in reasonable order and repair throughout the Lease
Term; provided, however, that Landlord shall not be liable for any failure to make any repairs or
to perform any maintenance unless such failure shall persist for an unreasonable time after written
notice of the need for such repairs or maintenance is given to Landlord by Tenant. Except as
provided in Article XI, there shall be no abatement of Rent, nor shall there be any liability of
Landlord, by reason of any injury or inconvenience to, or interference with, Tenant’s business or
operations arising from the making of, or failure to make, any maintenance or repairs in or to any
portion of the Building.

     8.02 Tenant’s Obligations. During the Lease Term, Tenant shall, at its sole cost and expense,
maintain the Premises in good order and repair (including, without limitation, the carpet,
wall-covering, doors, plumbing and other fixtures, equipment, alterations and improvements, whether
installed by Landlord or Tenant). Further, Tenant shall be responsible for, and upon demand by
Landlord shall promptly reimburse Landlord for, any damage to any portion of the Building or the
Premises caused by (a) Tenant’s activities in the Building or the Premises; (b) the performance or
existence of any alterations, additions or improvements made by Tenant in or to the Premises; (c)
the installation, use, operation or movement of Tenant’s property in or about the Building or the
Premises; or (d) any act or omission by Tenant or its officers, partners, employees, agents,
contractors or invitees.

     8.03 Landlord’s Rights. Landlord and its contractors shall have the right, at all reasonable
times and upon twenty-four (24) hour prior oral or telephonic notice to Tenant at the Premises,
other than in the case of any emergency in which case no notice shall be required, to enter upon
the Premises to make any repairs to the Premises or the Building reasonably required or deemed
reasonably necessary by Landlord and to erect such equipment, including scaffolding, as is
reasonably necessary to effect such repairs.

ARTICLE IX – ALTERATIONS, ADDITIONS AND IMPROVEMENTS

     9.01 Landlord’s Consent; Conditions. Tenant shall not make or permit to be made any
alterations, additions, or improvements in or to the Premises (“Alterations”) without the prior
written consent of Landlord, which consent, with respect to non-structural alterations, shall not
be unreasonably withheld. Landlord may impose as a condition to making any Alterations such
requirements as Landlord in its sole discretion deems necessary or desirable including without
limitation: Tenant’s submission to Landlord, for Landlord’s prior written approval, of all plans
and specifications relating to the Alterations; Landlord’s prior written approval of the time or
times when the Alterations are to be performed; Landlord’s prior written approval of the
contractors and subcontractors performing work in connection with the Alterations; employment of
union contractors and subcontractors who shall not cause labor disharmony; Tenant’s receipt of all
necessary permits and approvals from all governmental authorities having jurisdiction over the
Premises prior to the construction of the Alterations; Tenant’s delivery to Landlord of such bonds
and insurance as Landlord shall reasonably require; and Tenant’s payment to Landlord of all costs
and expenses incurred by Landlord because of Tenant’s Alterations, including but not limited to
costs incurred in reviewing the plans and specifications for, and the progress of, the

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Alterations. Tenant is required to provide Landlord written notice of whether the Alterations
include the Handling of any Hazardous Materials and whether these materials are of a customary and
typical nature for industry practices. Upon completion of the Alterations, Tenant shall provide
Landlord with copies of as-built plans. Neither the approval by Landlord of plans and
specifications relating to any Alterations nor Landlord’s supervision or monitoring of any
Alterations shall constitute any warranty by Landlord to Tenant of the adequacy of the design for
Tenant’s intended use or the proper performance of the Alterations.

     9.02 Performance of Alterations Work. All work relating to the Alterations shall be performed
in compliance with the plans and specifications approved by Landlord, all applicable laws,
ordinances, rules, regulations and directives of all governmental authorities having jurisdiction
(including without limitation Title 24 of the California Administrative Code) and the requirements
of all carriers of insurance on the Premises and the Building, the Board of Underwriters, Fire
Rating Bureau, or similar organization. All work shall be performed in a diligent, first class
manner and so as not to unreasonably interfere with any other tenants or occupants of the Building.
All costs incurred by Landlord relating to the Alterations shall be payable to Landlord by Tenant
as additional rent upon demand. No asbestos-containing materials shall be used or incorporated in
the Alterations. No lead-containing surfacing material, solder, or other construction materials or
fixtures where the presence of lead might create a condition of exposure not in compliance with
Environmental Laws shall be incorporated in the Alterations. In connection with the foregoing,
Landlord represents that as of the date set forth above that the Premises does not contain any
asbestos containing materials and that in the event that any are discovered that Landlord shall be
responsible to remove same in accordance with applicable law.

     9.03 Liens. Tenant shall pay when due all costs for work performed and materials supplied to
the Premises. Tenant shall keep Landlord, the Premises and the Building free from all liens, stop
notices and violation notices relating to the Alterations or any other work performed for,
materials furnished to or obligations incurred by or for Tenant and Tenant shall protect,
indemnify, hold harmless and defend Landlord, the Premises and the Building of and from any and all
loss, cost, damage, liability and expense, including attorneys’ fees, arising out of or related to
any such liens or notices. Further, Tenant shall give Landlord not less then seven (7) business
days prior written notice before commencing any Alterations in or about the Premises to permit
Landlord to post appropriate notices of non-responsibility. Tenant shall also secure, prior to
commencing any Alterations in excess of $50,000.00, at Tenant’s sole expense, a completion and lien
indemnity bond satisfactory to Landlord for such work. During the progress of such work, Tenant
shall, upon Landlord’s request, furnish Landlord with sworn contractor’s statements and lien
waivers covering all work theretofore performed. Tenant shall satisfy or otherwise discharge all
liens, stop notices or other claims or encumbrances within thirty (30) days after Landlord notifies
Tenant in writing that any such lien, stop notice, claim or encumbrance has been filed. If Tenant
fails to pay and remove such lien, claim or encumbrance within such thirty (30) days, Landlord, at
its election, may pay and satisfy the same and in such event the sums so paid by Landlord, with
interest from the date of payment at the rate set forth in Section 4.06 hereof for amounts owed
Landlord by Tenant shall be deemed to be additional rent due and payable by Tenant at once without
notice or demand.

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     9.04 Lease Termination. Except as provided in this Section 9.04, upon expiration or earlier
termination of this Lease Tenant shall surrender the Premises to Landlord in the same condition as
existed on the date Tenant first occupied the Premises, (whether pursuant to this Lease or an
earlier lease), subject to reasonable wear and tear. All Alterations shall become a part of the
Premises and shall become the property of Landlord upon the expiration or earlier termination of
this Lease, unless Landlord shall, by written notice given to Tenant, require Tenant to remove some
or all of Tenant’s Alterations, in which event Tenant shall promptly remove the designated
Alterations and shall promptly repair any resulting damage, all at Tenant’s sole expense. All
business and trade fixtures, machinery and equipment, furniture, movable partitions and items of
personal property owned by Tenant or installed by Tenant at its expense in the Premises shall be
and remain the property of Tenant; upon the expiration or earlier termination of this Lease, Tenant
shall, at its sole expense, remove all such items and repair any damage to the Premises or the
Building caused by such removal. If Tenant fails to remove any such items or repair such damage
promptly after the expiration or earlier termination of the Lease, Landlord may, but need not, do
so with no liability to Tenant, and Tenant shall pay Landlord the cost thereof upon demand.
Notwithstanding the foregoing to the contrary, in the event that Landlord gives its consent,
pursuant to the provisions of Section 9.01 of this Lease, to allow Tenant to make an Alteration in
the Premises, Landlord agrees, upon Tenant’s written request, to notify Tenant in writing at the
time of the giving of such consent whether Landlord will require Tenant, at Tenant’s cost, to
remove such Alteration at the end of the Lease Term.

ARTICLE X -INDEMNIFICATION AND INSURANCE

     10.01 Indemnification.

          (A) Tenant agrees to protect, indemnify, hold harmless and defend Landlord and any Mortgagee
(except outside of Tenant’s premises), as defined herein, and each of their respective partners,
directors, officers, agents and employees, successors and assigns, (except to the extent of the
losses described below are caused by the gross negligence of Landlord, its agents and employees),
from and against:

               (i) any and all loss, cost, damage, liability or expense as incurred (including but not
limited to reasonable attorneys’ fees and legal costs) arising out of or related to any claim, suit
or judgment brought by or in favor of any person or persons for damage, loss or expense due to, but
not limited to, bodily injury, including death, or property damage sustained by such person or
persons which arises out of, is occasioned by or is in any way attributable to the use or occupancy
of the Premises or any portion of the Building by Tenant or the acts or omission of Tenant or its
agents, employees, contractors, clients, invitees or subtenants except that caused by the sole
active negligence or willful misconduct of Landlord or its agents or employees. Such loss or
damage shall include, but not be limited to, any injury or damage to, or death of, Landlord’s
employees or agents or damage to the Premises or any portion of the Building.

               (ii) any and all environmental damages which arise from: (i) the Handling of any Tenant’s
Hazardous Materials, as defined in Section 6.03 or (ii) the breach of any of the provisions of this
Lease. For the purpose of this Lease, “environmental damages” shall mean (a) all claims,
judgments, damages, penalties, fines, costs, liabilities, and losses

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(including without limitation, diminution in the value of the Premises or any portion of the
Building, damages for the loss of or restriction on use of rentable or usable space or of any
amenity of the Premises or any portion of the Building, and from any adverse impact on Landlord’s
marketing of space); (b) all reasonable sums paid for settlement of claims, attorneys’ fees,
consultants’ fees and experts’ fees; and (c) all costs incurred by Landlord in connection with
investigation or remediation relating to the Handling of Tenant’s Hazardous Materials, whether or
not required by Environmental Laws, necessary for Landlord to make full economic use of the
Premises or any portion of the Building, or otherwise required under this Lease. To the extent
that Landlord is held strictly liable by a court or other governmental agency of competent
jurisdiction under any Environmental Laws, Tenant’s obligation to Landlord and the other
indemnities under the foregoing indemnification shall likewise be without regard to fault on
Tenant’s part with respect to the violation of any Environmental Law which results in liability to
the indemnitee. Tenant’s obligations and liabilities pursuant to this Section 10.01 shall survive
the expiration or earlier termination of this Lease.

          (B) Landlord agrees to protect, indemnify, hold harmless and defend Tenant from and against
any and all loss, cost, damage, liability or expense, including reasonable attorneys’ fees, with
respect to any claim of damage or injury to persons or property at the Premises, caused by the
negligence or willful misconduct of Landlord or its authorized agents or employees.

          (C) Notwithstanding anything to the contrary contained herein, nothing shall be interpreted or
used to in any way affect, limit, reduce or abrogate any insurance coverage provided by any
insurers to either Tenant or Landlord.

          (D) Notwithstanding anything to the contrary contained in this Lease, nothing herein shall be
construed to infer or imply that Tenant is a partner, joint venturer, agent, employee, or otherwise
acting by or at the direction of Landlord.

     10.02 Property Insurance.

          (A) At all times during the Lease Term, Tenant shall procure and maintain, at its sole
expense, “all-risk” property insurance, for damage or other loss caused by fire or other casualty
or cause including, but not limited to, vandalism and malicious mischief, theft, water damage of
any type, including sprinkler leakage, bursting of pipes, explosion, in an amount not less than
ninety percent (90%) of the replacement cost covering (a) all Alterations made by or for Tenant in
the Premises; and (b) Tenant’s trade fixtures, equipment and other personal property from time to
time situated in the Premises. The proceeds of such insurance shall be used for the repair or
replacement of the property so insured, except that if not so applied or if this Lease is
terminated following a casualty, the proceeds applicable to the leasehold improvements shall be
paid to Landlord and the proceeds applicable to Tenant’s personal property shall be paid to Tenant.

          (B) At all times during the Lease Term, Tenant shall procure and maintain business
interruption insurance in such amount as will reimburse Tenant for direct or indirect loss of
earnings attributable to all perils insured against in Section 10.02(A).

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          (C) Landlord shall, at all times during the Lease Term, procure and maintain “all-risk”
property insurance in the amount not less than ninety percent (90%) of the insurable replacement
cost covering the Building in which the Premises are located and such other insurance as may be
required by a Mortgagee or otherwise desired by Landlord.

     10.03 Liability Insurance.

          (A) At all times during the Lease Term, Tenant shall procure and maintain, at its sole
expense, commercial general liability insurance applying to the use and occupancy of the Premises
and the business operated by Tenant. Such insurance shall have a minimum combined single limit of
liability of at least One Million Dollars ($1,000,000) per occurrence and a general aggregate limit
of at least One Million Dollars ($1,000,000). All such policies shall be written to apply to all
bodily injury, property damage, personal injury losses and shall be endorsed to include Landlord
and its agents, beneficiaries, partners, employees, and any deed of trust holder or mortgagee of
Landlord or any ground lessor as additional insureds. Such liability insurance shall be written as
primary policies, not excess or contributing with or secondary to any other insurance as may be
available to the additional insureds.

          (B) Prior to the sale, storage, use or giving away of alcoholic beverages on or from the
Premises by Tenant or another person, Tenant, at its own expense, shall obtain a policy or policies
of insurance issued by a responsible insurance company and in a form acceptable to Landlord saving
harmless and protecting Landlord and the Premises against any and all damages, claims, liens,
judgments, expenses and costs, including actual attorneys’ fees, arising under any present or
future law, statute, or ordinance of the State of California or other governmental authority having
jurisdiction of the Premises, by reason of any storage, sale, use or giving away of alcoholic
beverages on or from the Premises. Such policy or policies of insurance shall have a minimum
combined single limit of One Million ($1,000,000) per occurrence and shall apply to bodily injury,
fatal or nonfatal; injury to means of support; and injury to property of any person. Such policy
or policies of insurance shall name Landlord and its agents, beneficiaries, partners, employees and
any mortgagee of Landlord or any ground lessor of Landlord as additional insureds.

          (C) Landlord shall, at all times during the Lease Term, procure and maintain commercial
general liability insurance for the Building in which the Premises are located. Such insurance
shall have minimum combined single limit of liability of at least Two Million Dollars ($2,000,000)
per occurrence, and a general aggregate limit of at least Two Million Dollars ($2,000,000).

     10.04 Workers’ Compensation Insurance. At all times during the Lease Term, Tenant shall
procure and maintain Workers’ Compensation Insurance in accordance with the laws of the State of
California, and Employer’s Liability insurance with a limit not less than One Million Dollars
($1,000,000) Bodily Injury Each Accident; One Million Dollars ($1,000,000) Bodily Injury By Disease
- Each Person; and One Million Dollars ($1,000,000) Bodily Injury to Disease — Policy Limit.

     10.05 Policy Requirements. All insurance required to be maintained by Tenant shall be issued
by insurance companies authorized to do insurance business in the State of California and

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rated not less than A-VIII in Best’s Insurance Guide. A certificate of insurance (or, at
Landlord’s option, copies of the applicable policies) evidencing the insurance required under this
Article X shall be delivered to Landlord not less than fifteen (15) days prior to the Commencement
Date. No such policy shall be subject to cancellation or modification without thirty (30) days
prior written notice to Landlord and to any deed of trust holder, mortgagee or ground lessor
designated by Landlord to Tenant. Tenant shall furnish Landlord with a replacement certificate
with respect to any insurance not less than thirty (30) days prior to the expiration of the current
policy. Tenant shall have the right to provide the insurance required by this Article X pursuant
to blanket policies, but only if such blanket policies expressly provide coverage to the Premises
and Landlord as required by this Lease.

     10.06 Waiver of Subrogation. Each party hereby waives any right of recovery against the other
for injury or loss due to hazards covered by insurance or required to be covered, to the extent of
the injury or loss covered thereby. Any policy of insurance to be provided by Tenant or Landlord
pursuant to this Article X shall contain a clause denying the applicable insurer any right of
subrogation against the other party.

     10.07 Failure to Insure. If Tenant fails to maintain any insurance which Tenant is required
to maintain pursuant to this Article X, Tenant shall be liable to Landlord for any loss or cost
resulting from such failure to maintain any such policy of insurance. Tenant may not self-insure
against any risks required to be covered by insurance without Landlord’s prior written consent.

ARTICLE XI — DAMAGE OR DESTRUCTION

     11.01 Total Destruction. Except as provided in Section 11.03 below, this Lease shall
automatically terminate if the Building is totally destroyed.

     11.02 Partial Destruction of Premises. If the Premises are damaged by any casualty and, in
Landlord’s opinion, the Premises (exclusive of any Alterations made to the Premises by Tenant) can
be restored to its pre-existing condition within two hundred seventy (270) days after the date of
the damage or destruction, Landlord shall, upon written notice from Tenant to Landlord of such
damage, except as provided in Section 11.03, promptly and with due diligence repair any damage to
the Premises (exclusive of any Alterations to the Premises made by Tenant, which shall be promptly
repaired by Tenant at its sole expense) and, until such repairs are completed, the Rent shall be
abated from the date of damage or destruction in the same proportion that the rentable area of the
portion of the Premises which is unusable by Tenant in the conduct of its business bears to the
total rentable area of the Premises. If such repairs cannot, in Landlord’s opinion, be made within
said two hundred seventy (270) day period, then Landlord may, at its option, exercisable by written
notice given to Tenant within thirty (30) days after the date of the damage or destruction, elect
to make the repairs within a reasonable time after the damage or destruction, in which event this
Lease shall remain in full force and effect but the Rent shall be abated as provided in the
preceding sentence; if Landlord does not so elect to make the repairs, then either Landlord or
Tenant shall have the right, by written notice given to the other within sixty (60) days after the
date of the damage or destruction, to terminate this Lease as of the date of the damage or
destruction.

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     11.03 Exceptions to Landlord’s Obligations. Notwithstanding anything to the contrary
contained in this Article XI, Landlord shall have no obligation to repair the Premises if either:
(a) the Building in which the Premises are located is so damaged as to require repairs to the
Building exceeding twenty percent (20%) of the full insurable value of the Building; or (b)
Landlord elects to demolish the Building in which the Premises are located; or (c) the damage or
destruction occurs less than two (2) years prior to the Termination Date, exclusive of option
periods; or (d) the damage or destruction is caused by an uninsured event. Further, Tenant’s Rent
shall not be abated if either (i) the damage or destruction is repaired within five (5) business
days after Landlord receives written notice from Tenant of the casualty, or (ii) Tenant, or any
officers, partners, employees, agents or invitees of Tenant, or any assignee or subtenant of
Tenant, is, in whole or in part, responsible for the damage or destruction.

     11.04 Waiver. The provisions contained in this Lease shall supersede any contrary laws
(whether statutory, common law or otherwise) now or hereafter in effect relating to damage,
destruction, self-help or termination, including California Civil Code Sections 1932 and 1933.

ARTICLE XII — CONDEMNATION

     12.01 Taking. If the entire Premises or so much of the Premises as to render the balance
unusable by Tenant shall be taken by condemnation, sale in lieu of condemnation or in any other
manner for any public or quasi-public purpose (collectively “Condemnation”), and if Landlord, at
its option, is unable or unwilling to provide substitute premises containing at least as much
rentable area as described in Section 1.02 above, then this Lease shall terminate on the date that
title or possession to the Premises is taken by the condemning authority, whichever is earlier.

     12.02 Award. In the event of any Condemnation, the entire award for such taking shall belong
to Landlord. Tenant shall have no claim against Landlord or the award for the value of any
unexpired term of this Lease or otherwise. Tenant shall be entitled to independently pursue a
separate award in a separate proceeding for Tenant’s relocation costs and Tenant’s trade fixtures
and those Alterations installed by Tenant associated with the taking, provided such separate award
does not diminish Landlord’s award.

     12.03 Temporary Taking. No temporary taking of the Premises shall terminate this Lease or
entitle Tenant to any abatement of the Rent payable to Landlord under this Lease; provided,
further, that any award for such temporary taking shall belong to Tenant to the extent that the
award applies to any time period during the Lease Term and to Landlord to the extent that the award
applies to any time period outside the Lease Term.

ARTICLE XIII — RELOCATION

     13.01 Relocation. Landlord shall have the right, at its option upon not less than sixty (60)
days prior written notice to Tenant, to relocate Tenant and to substitute for the Premises
described above other space in the Building containing at least as much rentable area as the
Premises described in Section 1.02 above with equal or better tenant improvement than the current
premises with comparable views. If Tenant is already in occupancy of the Premises, then Landlord
shall approve in advance the relocation expenses for purposes of reimbursement for Tenant’s
reasonable moving and telephone and computer relocation expenses and for reasonable
quantities of new stationery upon submission to Landlord of receipts for such expenditures
incurred by Tenant.

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ARTICLE XIV — ASSIGNMENT AND SUBLETTING

     14.01 Restriction. Without the prior written consent of Landlord, which shall not be
unreasonably withheld, Tenant shall not, either voluntarily or by operation of law, assign,
encumber, or otherwise transfer this Lease or any interest herein, or sublet the Premises or any
part thereof, or permit the Premises to be occupied by anyone other than Tenant or Tenant’s
employees (any such assignment, encumbrance, subletting, occupation or transfer is hereinafter
referred to as a “Transfer”). For purposes of this Lease, the tern “Transfer” shall also include
(a) if Tenant is a partnership, the withdrawal or change, voluntary, involuntary or by operation of
law, of a majority of the partners, or a transfer of a majority of partnership interests, within a
twelve month period, or the dissolution of the partnership, (b) if Tenant is a closely held
corporation (i.e. whose stock is not publicly held and not traded through an exchange or over the
counter) or a limited liability company, the dissolution, merger, consolidation, division,
liquidation or other reorganization of Tenant, or within a twelve month period: (i) the sale or
other transfer of more than an aggregate of 50% of the voting securities of Tenant (other than to
immediate family members by reason of gift or death) or (ii) the sale, mortgage, hypothecation or
pledge of more than an aggregate of 50% of Tenant’s net assets, and (c) any change by Tenant in the
form of its legal organization under applicable state law (such as, for example, a change from a
general partnership to a limited partnership or from a corporation to a limited liability company).
An assignment, subletting or other action in violation of the foregoing shall be void and, at
Landlord’s option, constitute a material breach of this Lease. Notwithstanding anything contained
in this Article XIV to the contrary, Tenant shall have the right to assign the Lease or sublease
the Premises, or any part thereof, to an “Affiliate” without the prior written consent of Landlord,
but upon at least twenty (20) days’ prior written notice to Landlord, provided that said Affiliate
is not in default after notice and beyond the expiration of any applicable cure period under any
other lease for space in a property that is managed by Landlord or its managing agent. For
purposes of this provision, the tern “Affiliate” shall mean any corporation or other entity
controlling, controlled by, or under common control with (directly or indirectly) Tenant,
including, without limitation, any parent corporation controlling Tenant or any subsidiary that
Tenant controls. The term “control,” as used herein, shall mean the power to direct or cause the
direction of the management and policies of the controlled entity through the ownership of more
than fifty percent (50%) of the voting securities in such controlled entity. Notwithstanding
anything contained in this Article XIV to the contrary, Tenant expressly covenants and agrees not
to enter into any lease, sublease, license, concession or other agreement for use, occupancy or
utilization of the Premises which provides for rental or other payment for such use, occupancy or
utilization based in whole or in part on the net income or profits derived by any person from the
property leased, used, occupied or utilized (other than an amount based on a fixed percentage or
percentages of receipts or sales), and that any such purported lease, sublease, license, concession
or other agreement shall be absolutely void and ineffective as a conveyance of any right or
interest in the possession, use, occupancy or utilization of any part of the Premises.

     14.02 Notice to Landlord. If Tenant desires to assign this Lease or any interest herein, or
to sublet all or any part of the Premises, then at least thirty (30) days but not more than one
hundred eighty (180) days prior to the effective date of the proposed assignment or
subletting, Tenant shall submit to Landlord in connection with Tenant’s request for Landlord’s
consent:

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          (A) A statement containing (i) the name and address of the proposed assignee or subtenant;
(ii) such financial information with respect to the proposed assignee or subtenant as Landlord
shall reasonably require; (iii) the type of use proposed for the Premises; and (iv) all of the
principal terms of the proposed assignment or subletting as are typically set forth in a letter of
intent; and

          (B) Four (4) originals of the assignment or sublease on a form approved by Landlord and four
(4) originals of the Landlord’s Consent to Sublease or Assignment and Assumption of Lease and
Consent.

     14.03 Landlord’s Recapture Rights. At any time within twenty (20) business days after
Landlord’s receipt of all (but not less than all) of the information and documents described in
Section 14.02 above, Landlord may, at its option by written notice to Tenant, elect to: (a)
sublease the Premises or the portion thereof proposed to be sublet by Tenant upon the same terms as
those offered to the proposed subtenant; (b) take an assignment of the Lease upon the same terms as
those offered to the proposed assignee; or (c) terminate the Lease in its entirety or as to the
portion of the Premises proposed to be assigned or sublet, with a proportionate adjustment in the
Rent payable hereunder if the Lease is terminated as to less than all of the Premises. If Landlord
does not exercise any of the options described in the preceding sentence, then, during the
above-described twenty (20) business day period, Landlord shall either consent or deny its consent
to the proposed assignment or subletting. In the event that Landlord fails to give its consent or
deny its consent to any proposed assignment of this Lease or subletting of the Premises at the
conclusion of said twenty (20) day period, then said consent shall be deemed given to any such
assignment or subletting.

     14.04 Landlord’s Consent; Standards. Landlord’s consent to a proposed assignment or
subletting shall not be unreasonably withheld, conditioned or delayed; but, in addition to any
other grounds for denial, Landlord’s consent shall be deemed reasonably withheld if, in Landlord’s
good faith judgment: (i) the proposed assignee or subtenant does not have the financial strength
to perform its obligations under this Lease or any proposed sublease; (ii) the business and
operations of the proposed assignee or subtenant are not of comparable quality to the business and
operations being conducted by other tenants in the Building; (iii) the proposed assignee or
subtenant intends to use any part of the Premises for a purpose not permitted under this Lease;
(iv) either the proposed assignee or subtenant, or any person which directly or indirectly
controls, is controlled by, or is under common control with the proposed assignee or subtenant
occupies space in the Building, or is negotiating with Landlord to lease space in the Building; (v)
the proposed assignee or subtenant is disreputable; or (vi) the use of the Premises or the Building
by the proposed assignee or subtenant would, in Landlord’s reasonable judgment, impact the Building
in a negative manner including but not limited to significantly increasing the pedestrian traffic
in and out of the Building or requiring any alterations to the Building to comply with applicable
laws; (vii) the subject space is not regular in shape with appropriate means of ingress and egress
suitable for normal renting purposes; (viii) the transferee is a government (or agency or
instrumentality thereof) or (ix) Tenant has failed to cure a default at the time Tenant requests
consent tot the proposed Transfer.

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     14.05 Additional Rent. If Landlord consents to any such assignment or subletting, one half
(1/2) of the amount by which all sums or other economic consideration received by Tenant in
connection with such assignment or subletting, whether denominated as rental or otherwise, exceeds,
in the aggregate, the total sum which Tenant is obligated to pay Landlord under this Lease
(prorated to reflect obligations allocable to less than all of the Premises under a sublease) shall
be paid to Landlord promptly after receipt as additional Rent under the Lease without affecting or
reducing any other obligation of Tenant hereunder.

     14.06 Landlord’s Costs. If Tenant shall Transfer this Lease or all or any part of the
Premises or shall request the consent of Landlord to any Transfer, Tenant shall pay to Landlord as
additional rent Landlord’s costs related thereto, including Landlord’s reasonable attorneys’ fees
and a minimum fee to Landlord of Five Hundred Dollars ($500.00).

     14.07 Continuing; Liability of Tenant. Notwithstanding any Transfer, including an assignment
or sublease to an Affiliate, Tenant shall remain as fully and primarily liable for the payment of
Rent and for the performance of all other obligations of Tenant contained in this Lease to the same
extent as if the Transfer had not occurred; provided, however, that any act or omission of any
transferee, other than Landlord, that violates the terms of this Lease shall be deemed a violation
of this Lease by Tenant.

     14.08 Non-Waiver. The consent by Landlord to any Transfer shall not relieve Tenant, or any
person claiming through or by Tenant, of the obligation to obtain the consent of Landlord, pursuant
to this Article XIV, to any further Transfer. In the event of an assignment or subletting,
Landlord may collect rent from the assignee or the subtenant without waiving any rights hereunder
and collection of the rent from a person other than Tenant shall not be deemed a waiver of any of
Landlord’s rights under this Article XIV, an acceptance of assignee or subtenant as Tenant, or a
release of Tenant from the performance of Tenant’s obligations under this Lease. If Tenant shall
default under this Lease and fail to cure within the time permitted, Landlord is irrevocably
authorized, as Tenant’s agent and attorney-in-fact, to direct any transferee to make all payments
under or in connection with the Transfer directly to Landlord (which Landlord shall apply towards
Tenant’s obligations under this Lease) until such default is cured.

ARTICLE XV — DEFAULT AND REMEDIES

     15.01 Events of Default By Tenant. The occurrence of any of the following shall constitute a
material default and breach of this Lease by Tenant:

     (A) The failure by Tenant to pay Base Rent or make any other payment required to be made by
Tenant hereunder as and when due.

     (B) The abandonment of the Premises by Tenant or the vacation of the Premises by Tenant for
fourteen (14) consecutive days (with or without the payment of Rent).

     (C) The making by Tenant of any assignment of this Lease or any sublease of all or part of the
Premises, except as expressly permitted under Article XIV of this Lease.

     (D) The failure by Tenant to observe or perform any other provision of this Lease to be
observed or performed by Tenant, other than those described in Sections 15.01(A), 15.01(B)

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or 15.01(C) above, if such failure continues for fifteen (15) days after written notice
thereof by Landlord to Tenant; provided, however, that if the nature of the default is such that it
cannot be cured within the fifteen (15) day period, no default shall exist if Tenant commences the
curing of the default within the fifteen (15) day period and thereafter diligently prosecutes the
same to completion. The fifteen (15) day notice described herein shall be in lieu of, and not in
addition to, any notice required under Section 1161 of the California Civil Code of Procedure or
any other law now or hereafter in effect requiring that notice of default be given prior to the
commencement of an unlawful detainer or other legal proceeding.

     (E) The making by Tenant or its Guarantor of any general assignment for the benefit of
creditors, the filing by or against Tenant or its Guarantor of a petition under any federal or
state bankruptcy or insolvency laws (unless, in the case of a petition filed against Tenant the
same is dismissed within sixty (60) days after filing); the appointment of a trustee or receiver to
take possession of substantially all of Tenant’s assets at the Premises or Tenant’s interest in
this Lease or the Premises, when possession is not restored to Tenant within sixty (60) days; or
the attachment, execution or other seizure of substantially all of Tenant’s assets located at the
Premises or Tenant’s interest in this Lease or the Premises, if such seizure is not discharged
within sixty (60) days.

     (F) Any material misrepresentation herein, or material misrepresentation or omission in any
financial statements or other materials provided by Tenant or any Guarantor in connection with
negotiating or entering into this Lease or in connection with any Transfer under Section 14.01.

     15.02 Landlord’s Right to Terminate Upon Tenant Default. In the event of any default by
Tenant as provided in Section 15.01 above, Landlord shall have the right to terminate this Lease
and recover possession of the Premises by giving written notice to Tenant of Landlord’s election to
terminate this Lease, in which event Landlord shall be entitled to receive from Tenant:

          (A) The worth at the time of award of any unpaid Rent which had been earned at the time of
such termination; plus

          (B) The worth at the time of award of the amount by which the unpaid Rent which would have
been earned after termination until the time of award exceeds the amount of such rental loss Tenant
proves could have been reasonably avoided; plus

          (C) The worth at the time of award of the amount by which the unpaid Rent for the balance of
the term after the time of award exceeds the amount of such rental loss that Tenant proves could be
reasonably avoided; plus

          (D) Any other amount necessary to compensate Landlord for all the detriment proximately caused
by Tenant’s failure to perform its obligations under this Lease or which in the ordinary course of
things would be likely to result therefrom; and

          (E) At Landlord’s election, such other amounts in addition to or in lieu of the foregoing as
may be permitted from time to time by applicable law.

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     As used in subparagraphs (A) and (B) above, “worth at the time of award” shall be computed by
allowing interest on such amounts at the then highest lawful rate of interest, but in no event to
exceed one percent (1%) per annum plus the rate established by the Federal Reserve Bank of San
Francisco on advances made to member banks under Sections of the Federal Reserve Act (“discount
rate”) prevailing at the time of the award. As used in paragraph (C) above, “worth at the time of
award” shall be computed by discounting such amount by (i) the discount rate of the Federal Reserve
Bank of San Francisco prevailing at the time of award plus (ii) one percent (1%).

     15.03 Mitigation of Damages. If Landlord terminates this Lease or Tenant’s right to
possession of the Premises, Landlord shall have no obligation to mitigate Landlord’s damages except
to the extent required by applicable law. If Landlord has not terminated this Lease or Tenant’s
right to possession of the Premises, Landlord shall have no obligation to mitigate under any
circumstances and may permit the Premises to remain vacant or abandoned. If Landlord is required
to mitigate damages as provided herein: (i) Landlord shall be required only to use reasonable
efforts to mitigate, which shall not exceed such efforts as Landlord generally uses to lease other
space in the Building, (ii) Landlord will not be deemed to have failed to mitigate if Landlord or
its affiliates lease any other portions of the Building or other projects owned by Landlord or its
affiliates in the same geographic area, before reletting all or any portion of the Premises, and
(iii) any failure to mitigate as described herein with respect to any period of time shall only
reduce the Rent and other amounts to which Landlord is entitled hereunder by the reasonable rental
value of the Premises during such period. In recognition that the value of the Building depends on
the rental rates and terms of leases therein, Landlord’s rejection of a prospective replacement
tenant based on an offer of rentals below Landlord’s published rates for new leases of comparable
space at the Building at the time in question, or at Landlord’s option, below the rates provided in
this Lease, or containing terms less favorable than those contained herein, shall not give rise to
a claim by Tenant that Landlord failed to mitigate Landlord’s damages.

     15.04 Landlord’s Right To Continue Lease Upon Tenant Default. In the event of a default of
this Lease and abandonment of the Premises by Tenant, if Landlord does not elect to terminate this
Lease as provided in Section 15.02 above, Landlord may from time to time, without terminating this
Lease, enforce all of its rights and remedies under this Lease. Without limiting the foregoing,
Landlord has the remedy described in California Civil Code Section 1951.4 (Landlord may continue
this Lease in effect after Tenant’s default and abandonment and recover Rent as it becomes due, if
Tenant has the right to Transfer, subject to reasonable limitations). In the event Landlord
re-lets the Premises, to the fullest extent permitted by law, the proceeds of any reletting shall
be applied first to pay to Landlord all reasonable costs and expenses of such reletting (including
without limitation, costs and expenses of retaking or repossessing the Premises, removing persons
and property therefrom, securing new tenants, including expenses for redecoration, alterations and
other costs in connection with preparing the Premises for the new tenant, and if Landlord shall
maintain and operate the Premises, the costs thereof) and receivers’ fees incurred in connection
with the appointment of and performance by a receiver to protect the Premises and Landlord’s
interest under this Lease and any necessary or reasonable alterations; second, to the payment of
any indebtedness of Tenant to Landlord other than Rent due and unpaid hereunder; third, to the
payment of Rent due and unpaid hereunder; and the residue, if any, shall be held by Landlord and
applied in payment of other or future
obligations of Tenant to Landlord as the same may become due and payable, and Tenant shall not
be entitled to receive any portion of such revenue.

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     15.05 Right of Landlord to Perform. All covenants and agreements to be performed by Tenant
under this Lease shall be performed by Tenant at Tenant’s sole cost and expense. If Tenant shall
fail to pay any sum of money, other than Rent, required to be paid by it hereunder or shall fail to
perform any other act on its part to be performed hereunder, Landlord may, but shall not be
obligated to, make any payment or perform any such other act on Tenant’s part to be made or
performed, without waiving or releasing Tenant of its obligations under this Lease. Any sums so
paid by Landlord and all necessary incidental costs, together with interest thereon at the lesser
of the maximum rate permitted by law if any or twelve percent (12%) per annum from the date of such
payment, shall be payable to Landlord as additional rent on demand and Landlord shall have the same
rights and remedies in the event of nonpayment as in the case of default by Tenant in the payment
of Rent.

     15.06 Default Under Other Leases. If the term of any lease, other than this Lease, heretofore
or hereafter made by Tenant for any office space in the Building shall be terminated or terminable
after the making of this Lease because of any default by Tenant under such other lease, such fact
shall empower Landlord, at Landlord’s sole option, to terminate this Lease by notice to Tenant or
to exercise any of the rights or remedies set forth in Section 15.02.

     15.07 Non-Waiver. Nothing in this Article shall be deemed to affect Landlord’s rights to
indemnification for liability or liabilities arising prior to termination of this Lease or Tenant’s
right to possession of the Premises for personal injury or property damages under the
indemnification clause or clauses contained in this Lease. No acceptance by Landlord of a lesser
sum than the Rent then due shall be deemed to be other than on account of the earliest installment
of such rent due, nor shall any endorsement or statement on any check or any letter accompanying
any check or payment as rent be deemed an accord and satisfaction, and Landlord may accept such
check or payment without prejudice to Landlord’s right to recover the balance of such installment
or pursue any other remedy in the Lease provided. The delivery of keys to any employee of Landlord
or to Landlord’s agent or any employee thereof shall not operate as a termination of this Lease or
a surrender of the Premises, unless accompanied by a letter from the Landlord’s representative
accepting possession of the Premises.

     15.08 Cumulative Remedies. The specific remedies to which Landlord may resort under the terms
of the Lease are cumulative and are not intended to be exclusive of any other remedies or means of
redress to which it may be lawfully entitled in case of any breach or threatened breach by Tenant
of any provisions of the Lease. In addition to the other remedies provided in the Lease, Landlord
shall be entitled to a restraint by injunction of the violation or attempted or threatened
violation of any of the covenants, conditions or provisions of the Lease or to a decree compelling
specific performance of any such covenants, conditions or provisions.

     15.09 Default by Landlord. Landlord’s failure to perform or observe any of its obligations
under this Lease shall constitute a default by Landlord under this Lease only if such failure shall
continue for a period of thirty (30) days (or the additional time, if any, that is reasonably
necessary to promptly and diligently cure the failure) after Landlord receives written notice from
Tenant specifying the default. The notice shall give in reasonable detail the nature

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and extent of the failure and shall identify the Lease provision(s) containing the
obligation(s). If Landlord shall default in the performance of any of its obligations under this
Lease (after notice and opportunity to cure as provided herein), Tenant may pursue any remedies
available to it under the law and this Lease, except that, in no event, shall Landlord be liable
for punitive damages, lost profits, business interruption, speculative, consequential or other such
damages. In recognition that Landlord must receive timely payments of Rent and operate the
Building, Tenant shall have no right of self-help to perform repairs or any other obligation of
Landlord, and shall have no right to withhold, set-off, or abate Rent.

ARTICLE XVI — ATTORNEYS’ FEES; COSTS OF SUIT

     16.01 Attorneys Fees. If either Landlord or Tenant shall commence any action or other
proceeding against the other arising out of, or relating to, this Lease or the Premises, the
prevailing party shall be entitled to recover from the losing party, in addition to any other
relief, its actual attorneys’ fees irrespective of whether or not the action or other proceeding is
prosecuted to judgment and irrespective of any court schedule of reasonable attorneys’ fees. In
addition, Tenant shall reimburse Landlord, upon demand, for all reasonable attorneys’ fees incurred
in collecting Rent, resolving any actual default by Tenant, securing indemnification as provided in
Article X and paragraphs, 16.02, 23.01 and 25.01 herein or otherwise seeking enforcement against
Tenant, its sublessees and assigns, of Tenant’s obligations under this Lease.

     16.02 Indemnification. Should Landlord be made a party to any litigation instituted by Tenant
against a party other than Landlord, or by a third party against Tenant, Tenant shall indemnify,
hold harmless and defend Landlord from any and all loss, cost, liability, damage or expense
incurred by Landlord, including attorneys’ fees, in connection with the litigation.

ARTICLE XVII — SUBORDINATION AND ATTORNMENT

     17.01 Subordination. This Lease, and the rights of Tenant hereunder, are and shall be subject
and subordinate to the interest of (i) all present and future ground leases and master leases of
all or any part of the Building; (ii) present and future mortgages and deeds of trust encumbering
all or any part of the Building; (iii) all past and future advances made under any such mortgages
or deeds of trust; and (iv) all renewals, modifications, replacements and extensions of any such
ground leases, master leases, mortgages and deeds of trust; provided, however, that any lessor
under any such ground lease or master lease or any mortgagee or beneficiary under any such mortgage
or deed of trust (any such lessor, mortgagee or beneficiary is hereinafter referred to as a
“Mortgagee”) shall have the right to elect, by written notice given to Tenant, to have this Lease
made superior in whole or in part to any such ground lease, master lease, mortgage or deed of trust
(or subject and subordinate to such ground lease, master lease, mortgage or deed of trust but
superior to any junior mortgage or junior deed of trust). Upon demand, Tenant shall execute,
acknowledge and deliver any instruments reasonably requested by Landlord or any such Mortgagee to
effect the purposes of this Section 17.01. Such instruments may contain, among other things,
provisions to the effect that such Mortgagee (hereafter, for the purposes of this Section 17.01, a
“Successor Landlord”) shall (i) not be liable for any act or omission of Landlord or its
predecessors, if any, prior to the date of such Successor Landlord’s succession to Landlord’s
interest under this Lease; (ii) not be subject to any offsets or defenses which Tenant might have
been able to assert against Landlord or its predecessors, if any, prior to

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the date of such Successor Landlord’s succession to Landlord’s interest under this Lease;
(iii) not be liable for the return of any security deposit under the Lease unless the same shall
have actually been deposited with such Successor Landlord; (iv) be entitled to receive notice of
any Landlord default under this Lease plus a reasonable opportunity to cure such default prior to
Tenant having any right or ability to terminate this Lease as a result of such Landlord default;
(v) not be bound by any rent or additional rent which Tenant might have paid for more than the
current month to Landlord; (vi) not be bound by any amendment or modification of the Lease or any
cancellation or surrender of the same made without Successor Landlord’s prior written consent;
(vii) not be bound by any obligation to make any payment to Tenant which was required to be made
prior to the time such Successor Landlord succeeded to Landlord’s interest and (viii) not be bound
by any obligation under the Lease to perform any work or to make any improvements to the demised
Premises. Any obligations of any Successor Landlord under its respective lease shall be
non-recourse as to any assets of such Successor Landlord other than its interest in the Premises
and improvements.

     17.02 Attornment. If the interests of Landlord under the Lease shall be transferred to any
superior Mortgagee or other purchaser or person taking title to the Building by reason of the
termination of any superior lease or the foreclosure of any superior mortgage or deed of trust,
Tenant shall be bound to such Successor Landlord under all of the terms, covenants and conditions
of the Lease for the balance of the term thereof remaining and any extensions or renewals thereof
which may be effected in accordance with any option therefor in the Lease, with the same force and
effect as if Successor Landlord were the landlord under the Lease, and Tenant shall attorn to and
recognize as Tenant’s landlord under this Lease such Successor Landlord, as its landlord, said
attornment to be effective and self-operative without the execution of any further instruments upon
Successor Landlord’s succeeding to the interest of Landlord under the Lease. Tenant shall, upon
demand, execute any documents reasonably requested by any such person to evidence the attornment
described in this Section 17.02. Concurrently, upon written request from Tenant, and provided
Tenant is not in default under this Lease, Landlord agrees to use diligent, commercially reasonable
efforts to obtain a Non-Disturbance Agreement from the Successor Landlord. Such Non-Disturbance
Agreement may be embodied in the Mortgagee’s customary form of Subordination and Non-Disturbance
Agreement. If, after exerting diligent, commercially reasonable efforts, Landlord is unable to
obtain a Non-Disturbance Agreement from any such Mortgagee, Landlord shall have no further
obligation to Tenant with respect thereto.

     17.03 Mortgage Protection. Tenant agrees to give any Mortgagee, by registered or certified
mail, a copy of any notice of default served upon Landlord by Tenant, provided that prior to such
notice Tenant has been notified in writing (by way of service on Tenant of a copy of Assignment of
Rents and Leases, or otherwise) of the address of such Mortgagee (hereafter the “Notified Party”).
Tenant further agrees that if Landlord shall have failed to cure such default within twenty (20)
days after such notice to Landlord (or if such default cannot be cured or corrected within that
time, then such additional time as may be necessary if Landlord has commenced within such twenty
(20) days and is diligently pursuing the remedies or steps necessary to cure or correct such
default), then the Notified Party shall have an additional thirty (30) days within which to cure or
correct such default (or if such default cannot be cured or corrected within that time, then such
additional time as may be necessary if the Notified Party has commenced within such thirty (30)
days and is diligently pursuing the remedies or steps

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necessary to cure or correct such default). Until the time allowed, as aforesaid, for the
Notified Party to cure such default has expired without cure, Tenant shall have no right to, and
shall not, terminate this Lease on account of Landlord’s default.

ARTICLE XVIII — QUIET ENJOYMENT

     18.01 Provided that Tenant performs all of its obligations hereunder, Tenant shall have and
peaceably enjoy the Premises during the Lease Term free of claims by or through Landlord, subject
to all of the terms and conditions contained in this Lease.

ARTICLE XIX — RULES AND REGULATIONS

     19.01 The Rules and Regulations attached hereto as Exhibit C are hereby incorporated by
reference herein and made a part hereof. Tenant shall abide by, and faithfully observe and comply
with the Rules and Regulations and any reasonable and non-discriminatory amendments, modifications
and/or additions thereto as may hereafter be adopted and published by written notice to tenants by
Landlord for the safety, care, security, good order and/or cleanliness of the Premises and/or the
Building. Landlord shall not be liable to Tenant for any violation of such rules and regulations
by any other tenant or occupant of the Building. Landlord represents that it shall enforce the
Rules and Regulations attached hereto as Exhibit C in a uniform non-discriminatory manner

ARTICLE XX — ESTOPPEL CERTIFICATES

     20.01 Tenant agrees at any time and from time to time upon not less than fourteen (14) days’
prior written notice from Landlord to execute, acknowledge and deliver to Landlord a statement in
writing addressed and certifying to Landlord, to any current or prospective Mortgagee or any
assignee thereof, to any prospective purchaser of the land, improvements or both comprising the
Building, and to any other party designated by Landlord, that this Lease is unmodified and in full
force and effect (or if there have been modifications, that the same is in full force and effect as
modified and stating the modifications); that Tenant has accepted possession of the Premises, which
are acceptable in all respects, and that any improvements required by the terms of this Lease to be
made by Landlord have been completed to the satisfaction of Tenant; that Tenant is in full
occupancy of the Premises; that no rent has been paid more than thirty (30) days in advance; that
the first month’s Base Rent has been paid; that Tenant is entitled to no free rent or other
concessions except as stated in this Lease; that Tenant has not been notified of any previous
assignment of Landlord’s or any predecessor landlord’s interest under this Lease; the dates to
which Base Rent, additional rental and other charges have been paid; that Tenant, as of the date of
such certificate, has no charge, lien or claim of setoff under this Lease or otherwise against Base
Rent, additional rental or other charges due or to become due under this Lease; that Landlord is
not in default in performance of any covenant, agreement or condition contained in this Lease; or
any other matter relating to this Lease or the Premises or, if so, specifying each such default.
If there is a Guaranty under this Lease, said Guarantor shall confirm the validity of the Guaranty
by joining in the execution of the Estoppel Certificate or other documents so requested by Landlord
or Mortgagee. In addition, in the event that such certificate is being given to any Mortgagee,
such statement may contain any other provisions customarily required by such Mortgagee including,
without limitation, an agreement

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on the part of Tenant to furnish to such Mortgagee, written notice of any Landlord default and
a reasonable opportunity for such Mortgagee to cure such default prior to Tenant being able to
terminate this Lease. Any such statement delivered pursuant to this Section may be relied upon by
Landlord or any Mortgagee, or prospective purchaser to whom it is addressed and such statement, if
required by its addressee, may so specifically state. If Tenant does not execute, acknowledge and
deliver to Landlord the statement as and when required herein, Landlord is hereby granted an
irrevocable power-of-attorney, coupled with an interest, to execute such statement on Tenant’s
behalf, which statement shall be binding on Tenant to the same extent as if executed by Tenant.

ARTICLE XXI — ENTRY BY LANDLORD

     21.01 Landlord may enter the Premises at all reasonable times, upon reasonable advance notice
to Tenant to: inspect the same; exhibit the same to prospective purchasers, Mortgagees or tenants;
determine whether Tenant is complying with all of its obligations under this Lease; supply
janitorial and other services to be provided by Landlord to Tenant under this Lease; post notices
of non-responsibility; and make repairs or improvements in or to the Building or the Premises;
provided, however, that all such work shall be done as promptly as reasonably possible and so as to
minimize the interference to Tenant as reasonably possible. Tenant hereby waives any claim for
damages for any injury or inconvenience to, or interference with, Tenant’s business, any loss of
occupancy or quiet enjoyment of the Premises or any other loss occasioned by such entry. Landlord
shall at all times have and retain a key with which to unlock all of the doors in, on or about the
Premises (excluding Tenant’s vaults, safes and similar areas designated by Tenant in writing in
advance), and Landlord shall have the right to use any and all means by which Landlord may deem
proper to open such doors to obtain entry to the Premises, and any entry to the Premises obtained
by Landlord by any such means, or otherwise, shall not under any circumstances be deemed or
construed to be a forcible or unlawful entry into or a detainer of the Premises or an eviction,
actual or constructive, of Tenant from any part of the Premises. Such entry by Landlord shall not
act as a termination of Tenant’s duties under this Lease. If Landlord shall be required to obtain
entry by means other than a key provided by Tenant, the cost of such entry shall by payable by
Tenant to Landlord as additional rent.

ARTICLE XXII — LANDLORD’S LEASE UNDERTAKINGS-EXCULPATION FROM PERSONAL LIABILITY; TRANSFER OF LANDLORD’S INTEREST

     22.01 Landlord’s Lease Undertakings. Notwithstanding anything to the contrary contained in
this Lease or in any exhibits, Riders or addenda hereto attached (collectively the “Lease
Documents”), it is expressly understood and agreed by and between the parties hereto that: (a) the
recourse of Tenant or its successors or assigns against Landlord with respect to the alleged breach
by or on the part of Landlord of any representation, warranty, covenant, undertaking or agreement
contained in any of the Lease Documents or otherwise arising out of Tenant’s use of the Premises or
the Building (collectively, “Landlord’s Lease Undertakings”) shall extend only to Landlord’s
interest in the real estate of which the Premises demised under the Lease Documents are a part
(“Landlord’s Real Estate”) and to the rents and income received therefrom and not to any other
assets of Landlord or its officers, directors or shareholders; and (b) except to the extent of
Landlord’s interest in Landlord’s Real Estate, no personal liability or personal responsibility of
any sort with respect to any of Landlord’s Lease Undertakings or any

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alleged breach thereof is assumed by, or shall at any time be asserted or enforceable against,
Landlord, or against any of their respective directors, officers, employees, agents, constituent
partners, beneficiaries, trustees or representatives.

     22.02 Transfer of Landlord’s Interest. In the event of any transfer of Landlord’s interest in
the Building, Landlord shall be automatically freed and relieved from all applicable liability with
respect to performance of any covenant or obligation on the part of Landlord, provided any deposits
or advance rents held by Landlord are turned over to the grantee and said grantee expressly assumes
in writing, subject to the limitations of this Section 22, all the terms, covenants and conditions
of this Lease to be performed on the part of Landlord, it being intended hereby that the covenants
and obligations contained in this Lease on the part of Landlord shall, subject to all the
provisions of this Section 22, be binding on Landlord, its successors and assigns, only during
their respective periods of ownership.

ARTICLE XXIII — HOLDOVER TENANCY

     23.01 If Tenant holds possession of the Premises after the expiration or termination of the
Lease Term, by lapse of time or otherwise, Tenant shall become a tenant at sufferance upon all of
the terms contained herein, except as to Lease Term and Rent. During such holdover period, Tenant
shall pay to Landlord a monthly rental equivalent to One hundred Fifty percent (150%) of the Rent
Payable by Tenant to Landlord with respect to the last month of the Lease Term. The monthly rent
payable for such holdover period shall in no event be construed as a penalty or as liquidated
damages for such retention of possession. Without limiting the foregoing, Tenant hereby agrees to
indemnify, defend and hold harmless Landlord, its beneficiary, and their respective agents,
contractors and employees, from and against any and all claims, liabilities, actions, losses,
damages (including without limitation, direct, indirect, incidental and consequential) and
reasonable expenses (including, without limitation, court costs and reasonable attorneys’ fees)
asserted against or sustained by any such party and arising from or by reason of such retention of
possession, which obligations shall survive the expiration or termination of the Lease Term.

ARTICLE XXIV — NOTICES

     24.01 All notices which Landlord or Tenant may be required, or may desire, to serve on the
other may be served, as an alternative to personal service, by mailing the same by registered or
certified mail, postage prepaid, addressed to Landlord at the address for Landlord set forth in
Section 1.12 above and to Tenant at the address for Tenant set forth in Section 1.13 above, or,
from and after the Commencement Date, to Tenant at the Premises, or addressed to such other address
or addresses as either Landlord or Tenant may from time to time designate to the other in writing.
Any notice shall be deemed to have been served at the time the same was posted.

ARTICLE XXV — BROKERS

     25.01 The parties recognize as the broker(s) who procured this Lease the firm(s) specified in
Section 1.14 and agree that Landlord shall be solely responsible for the payment of any brokerage
commissions to said broker(s), and that Tenant shall have no responsibility therefore unless
written provision to the contrary has been made a part of this Lease. If Tenant

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has dealt with any other person or real estate broker in respect to leasing, subleasing or
renting space in the Building, Tenant shall be solely responsible for the payment of any fee due
said person or firm and Tenant shall protect, indemnify, hold harmless and defend Landlord from any
liability in respect thereto.

ARTICLE XXVI — ELECTRONIC SERVICES

     26.01 Tenant’s Lines. Tenant may, in a manner consistent with the provisions and requirements
of this Lease, install, maintain, replace, remove or use any communications or computer or other
electronic service wires, cables and related devices (collectively the “Lines”) at the Building in
or serving the Premises, provided: (a) Tenant shall obtain Landlord’s prior written consent, which
consent may be conditioned as required by Landlord, (b) if Tenant at any time uses any equipment
that may create an electromagnetic field exceeding the normal insulation ratings of ordinary
twisted pair riser cable or cause radiation higher than normal background radiation, the Lines
therefore (including riser cables) shall be appropriately insulated to prevent such excessive
electromagnetic fields or radiation, and (c) Tenant shall pay all costs in connection therewith.
Landlord reserves the right to require upon fifteen (15) days written notice to Tenant that Tenant
remove any Lines which are installed in violation of these provisions. Tenant shall not, without
the prior written consent of Landlord in each instance, grant to any third party a security
interest or lien in or on the Lines, and any such security interest or lien granted without
Landlord’s written consent shall be null and void.

     26.02 Definition of Electronic Services. As used herein “Electronic Services Provider” means
a business which provides telephone, telegraph, telex, video, other telecommunications or other
services which permit Tenant to receive or transmit information by the use of electronics and which
require the use of wires, cables, antennas or similar devices in or on the Building. The services
of Electronic Services Providers are sometimes referred to herein as “Electronic Services.”

     26.03 No Right to Specific Services. Landlord shall have no obligation (i) to install any
Electronic Services equipment or facilities, (ii) to make available to Tenant the services of any
particular Electronic Services Provider, (iii) to allow any particular Electronic Services Provider
access to the Building, (iv) to continue to grant access to an Electronic Services Provider once
such provider has been given access to the Building. Landlord may (but shall not have the
obligation to): (x) install new Lines at the property, (y) create additional space for Lines at
the property, and (z) adopt reasonable and uniform rules and regulations with respect to Lines.

     26.04 Limitation of Landlord’s Responsibility. Tenant acknowledges and agrees that all
Electronic Services desired by Tenant shall be ordered and utilized at the sole expense of Tenant.
Unless Landlord otherwise requests or consents in writing, all of Tenant’s Electronic Services
equipment shall be and remain solely in the Tenant’s premises and the telephone closet(s) on the
floor(s) on which the Tenant’s premises is located, in accordance with rules and regulations
adopted by Landlord from time to time. Unless otherwise specifically agreed to in writing,
Landlord shall have no responsibility for the maintenance of Tenant’s Electronic Services
equipment, including Lines; nor for any Lines or other infrastructure to which Tenant’s Electronic
Services equipment may be connected. Tenant agrees that, to the extent any Electronic Services are
interrupted, curtailed or discontinued, Landlord shall have no obligation

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or liability with respect thereto and it shall be the sole obligation of Tenant at its own
expense to obtain substitute service. Except to the extent arising from the intentional or grossly
negligent acts of Landlord or Landlord’s agents or employees, Landlord shall have no liability for
damages arising from, and Landlord does not warrant that Tenant’s use of any Lines will be free
from the following (collectively called “Line Problems”): (x) any eavesdropping or wire-tapping by
unauthorized parties, (y) any failure of any Lines to satisfy Tenant’s requirements, or (z) any
shortages, failures, variations, interruptions, disconnections, loss or damage caused by the
installation, maintenance, replacement, use or removal of Lines by or for other tenants or
occupants at the property. Under no circumstances shall any Line Problems be deemed an actual or
constructive eviction of Tenant, render Landlord liable to Tenant for abatement of Rent, or relieve
Tenant from performance of Tenant’s obligations under this Lease. Landlord in no event shall be
liable for damages by reason of loss of profits, business interruption or other consequential
damage arising from any Line Problems.

     26.05 Necessary Service Interruptions. Landlord shall have the right, upon reasonable prior
notice to Tenant, to interrupt or turn off Electronic Services facilities in the event of emergency
or as necessary in connection with maintenance, repairs or construction at the Building or
installation of Electronic Services equipment for other Tenants of the Building or on account of
violation by the Electronic Services Provider or owner of the Electronic Services equipment of any
obligation to Landlord or in the event that Tenant’s use of the Electronic Services infrastructure
of the Building materially interferes with the Electronic Services of other tenants of the
Building.

     26.06 Removal of Equipment, Wiring and Other Facilities. Any and all Electronic Services
equipment installed in the Tenant’s Premises or elsewhere in the Building by or on behalf of
Tenant, including Lines, or other facilities for Electronic Services reception or transmittal,
shall be removed prior to the expiration or earlier termination of the Lease term, by Tenant at its
sole cost or, at Landlord’s election, by Landlord at Tenant’s sole cost, with the cost thereof to
be paid as additional rent. Landlord shall have the right, however, upon written notice to Tenant
given no later than thirty (30) days prior to the expiration or earlier termination of the Lease
term (except that the notice period shall extend to thirty (30) days beyond the date of termination
of the Lease if it is terminated by either party due to a default by the other), to require Tenant
to abandon and leave in place, without additional payment to Tenant or credit against rent, any and
all Electronic Services Lines and related infrastructure, or selected components thereof, whether
located in the Tenant’s premises or elsewhere in the Building.

     26.07 New Provider Installations. In the event that Tenant wishes at any time to utilize the
services of an Electronic Services Provider whose equipment is not then servicing the Building, no
such Electronic Services Provider shall be permitted to install its Lines or other equipment within
the Building without first securing the prior written approval of the Landlord. Landlord’s
approval shall not be deemed any kind of warranty or representation by Landlord, including, without
limitation, any warranty or representation as to the suitability, competence, or financial strength
of the Electronic Services Provider. Without limitation of the foregoing standard, unless all of
the following conditions are satisfied to Landlord’s satisfaction, it shall be reasonable for
Landlord to refuse to give its approval: (i) Landlord shall incur no current expense or risk or
future expense whatsoever with respect to any aspect of the Electronic Services Provider’s
provision of its Electronic Services, including without limitation, the costs of

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installation, materials and services; (ii) prior to commencement of any work in or about the
Building by the Electronic Services Provider, the Electronic Services Provider shall supply
Landlord with such written indemnities, insurance, financial statements, and such other items as
Landlord reasonably determines to be necessary to protect its financial interests and the interests
of the Building relating to the proposed activities of the Electronic Services Provider; (iii) the
Electronic Services Provider agrees to abide by such rules and regulations, Building and other
codes, job site rules and such other requirements as are reasonably determined by Landlord to be
necessary to protect the interests of the Building, the Tenants in the Building and Landlord, in
the same or similar manner as Landlord has the right to protect itself and the Building with
respect to proposed alterations as described in Article IX of this Lease; (iv) Landlord reasonably
determines that, considering other potential uses for space in the Building, there is sufficient
space in the Building for the placement of all of the provider’s equipment, conduit, Lines and
other materials; (v) the Electronic Services Provider agrees to abide by Landlord’s requirements,
if any, that provider use existing Building conduits and pipes or use Building contractors (or
other contractors approved by Landlord); (vi) Landlord receives from the Electronic Services
Provider such compensation as is reasonably determined by Landlord to compensate it for space used
in the Building for the storage and maintenance of the Electronic Services Provider’s equipment,
for the fair market value of a Electronic Services Provider’s access to the Building, for the use
of common or core space within the Building and the costs which may reasonably be expected to be
incurred by Landlord; (vii) the provider agrees to deliver to Landlord detailed “as built” plans
immediately after the installation of the provider’s equipment is complete; and (viii) all of the
foregoing matters are documented in a written license agreement between Landlord and the provider,
the form and content of which is reasonably satisfactory to Landlord.”

     26.08 Limit of Default or Breach. Notwithstanding any provision of the proceeding paragraphs
to the contrary, the refusal of Landlord to grant its approval to any prospective Electronic
Services Provider shall not be deemed a default or breach by Landlord of its obligation under this
Lease unless and until Landlord is adjudicated to have acted recklessly or maliciously with respect
to Tenant’s request for approval, and in that event, Tenant shall still have no right to terminate
the Lease or claim an entitlement to rent abatement, but may as Tenant’s sole and exclusive
recourse seek a judicial order of specific performance compelling Landlord to grant its approval as
to the prospective provider in question. The provisions of this paragraph may be enforced solely
by Tenant and Landlord, are not for the benefit of any other party, and specifically but without
limitation, no telephone or other Electronic Services Provider shall be deemed a third party
beneficiary of this Lease.

     26.09 Installation and Use of Wireless Technologies. Tenant shall not utilize any wireless
Electronic Services equipment (other than usual and customary cellular telephones), including
antennae and satellite receiver dishes, within the Tenant’s premises, within the Building or
attached to the outside walls or roof of the Building, without Landlord’s prior written consent.
Such consent may be conditioned in such a manner so as to protect Landlord’s financial interests
and the interests of the Building, and the other tenants therein, in a manner similar to the
arrangements described in the immediately preceding paragraphs.

     26.10 Limitation of Liability For Equipment Interference. In the event that Electronic
Services equipment, Lines and facilities or satellite and antennae equipment of any type installed
by or at the request of Tenant within the Tenant’s premises, on the roof, or elsewhere within or

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on the Building causes interference to equipment used by another party, Tenant shall cease
using such equipment, Lines and facilities or satellite and antennae equipment until the source of
the interference is identified and eliminated and Tenant shall assume all liability related to such
interference. Tenant shall cooperate with Landlord and other parties, to eliminate such
interference promptly. In the event that Tenant is unable to do so, Tenant will substitute
alternative equipment which remedies the situation. If such interference persists, Tenant shall,
at Landlord’s sole discretion, remove such equipment.

ARTICLE XXVII — PARKING

     27.01 During the term of this Lease, Tenant shall be entitled to rent the number of Tenant’s
Parking Stalls, if any, described in Section 1.16 of this Lease in the parking facilities located
within the Building; provided, however, that if Tenant does not rent all of the Tenant’s Parking
Stalls allocated to Tenant pursuant to Section 1.16, any change in the number of parking stalls
actually rented by Tenant shall require not less than ten (10) days prior notice to Landlord. Such
parking shall be on a non-assigned basis, and shall be at such rates and upon such other terms and
conditions as are published or posted from time to time by Landlord (or, at Landlord’s option, the
operator or lessee of the parking facilities). Tenant’s visitors shall have the right to use the
parking facilities, subject to availability and to the rates, rules and regulations governing
visitor parking from time to time adopted by Landlord (or, at Landlord’s option, the operator or
master lessee of the parking facilities).

ARTICLE XXVIII — MISCELLANEOUS

     28.01 Entire Agreement. This Lease contains all of the agreements and understandings relating
to the leasing of the Premises and the obligations of Landlord and Tenant in connection with such
leasing. Landlord has not made, and Tenant is not relying upon, any warranties, or
representations, promises or statements made by Landlord or any agent of Landlord, except as
expressly set forth herein. This Lease supersedes any and all prior agreements and understandings
between Landlord and Tenant and alone expresses the agreement of the parties.

     28.02 Amendments. This Lease shall not be amended, changed or modified in any way unless in
writing executed by Landlord and Tenant. Landlord shall not have waived or released any of its
rights hereunder unless in writing and executed by Landlord.

     28.03 Successors. Except as expressly provided herein, this Lease and the obligations of
Landlord and Tenant contained herein shall bind and benefit the successors and assigns of the
parties hereto.

     28.04 Force Majeure. Landlord shall incur no liability to Tenant with respect to, and shall
not be responsible for any failure to perform, any of Landlord’s obligations hereunder if such
failure is caused by any reason beyond the control of Landlord including, but not limited to,
strike, labor trouble, governmental rule, regulations, ordinance, statute or interpretation, or by
fire, earthquake, civil commotion, or failure or disruption of utility services. The amount of
time for Landlord to perform any of Landlord’s obligations shall be extended by the amount of time
Landlord is delayed in performing such obligation by reason of any force majeure occurrence whether
similar to or different from the foregoing types of occurrences.

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     28.05 Survival of Obligations. Any obligations of Tenant accruing prior to the expiration of
the Lease shall survive the expiration or earlier termination of the Lease, and Tenant shall
promptly perform all such obligations whether or not this Lease has expired or been terminated.

     28.06 Light and Air. No diminution or shutting off of any light, air or view by any structure
now or hereafter erected shall in any manner affect this Lease or the obligations of Tenant
hereunder, or increase any of the obligations of Landlord hereunder.

     28.07 Governing Law. This Lease shall be governed by, and construed in accordance with, the
laws of the State of California.

     28.08 Severability. In the event any provision of this Lease is found to be unenforceable,
the remainder of this Lease shall not be affected, and any provision found to be invalid shall be
enforceable to the extent permitted by law. The parties agree that in the event two different
interpretations may be given to any provision hereunder, one of which will render the provision
unenforceable, and one of which will render the provision enforceable, the interpretation rendering
the provision enforceable shall be adopted.

     28.09 Captions. All captions, headings, titles, numerical references and computer
highlighting are for convenience only and shall have no effect on the interpretation of this Lease.

     28.10 Interpretation. Tenant acknowledges that it has read and reviewed this Lease and that
it has had the opportunity to confer with counsel in the negotiation of this Lease. Accordingly,
this Lease shall be construed neither for nor against Landlord or Tenant, but shall be given a fair
and reasonable interpretation in accordance with the meaning of its terms and the intent of the
parties.

     28.11 Independent Covenants. Each covenant, agreement, obligation or other provision of this
Lease to be performed by Tenant are separate and independent covenants of Tenant, and not dependent
on any other provision of the Lease.

     28.12 Number and Gender. All terms and words used in this Lease, regardless of the number or
gender in which they are used, shall be deemed to include the appropriate number and gender, as the
context may require.

     28.13 Time is of the Essence. Time is of the essence of this Lease and the performance of all
obligations hereunder.

     28.14 Joint and Several Liability. If Tenant comprises more than one person or entity, or if
this Lease is guaranteed by any party, all such persons shall be jointly and severally liable for
payment of rents and the performance of Tenant’s obligations hereunder. If Tenant comprises more
than one person or entity and fewer than all of the persons or entities comprising Tenant abandon
the Premises, Landlord, at its sole option, may treat the abandonment by such person or entities as
an event of default and exercise with respect to such persons the rights and remedies provided in
Article XV without affecting the right or obligations of the persons or entities comprising Tenant
which have not abandoned the property.

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     28.15 Exhibits. Exhibits A (Outline of Premises), B (Work Letter Agreement), C (Rules and
Regulations), D (Guaranty) and E (Suite Acceptance Letter) are incorporated into this Lease by
reference and made a part hereof.

     28.16 Offer to Lease. The submission of this Lease to Tenant or its broker or other agent,
does not constitute an offer to Tenant to lease the Premises. This Lease shall have no force and
effect until (a) it is executed and delivered by Tenant to Landlord and (b) it is fully reviewed
and executed by Landlord; provided, however, that, upon execution of this Lease by Tenant and
delivery to Landlord, such execution and delivery by Tenant, shall, in consideration of the time
and expense incurred by Landlord in reviewing the Lease and Tenant’s credit, constitute an offer by
Tenant to lease the Premises upon the terms and conditions set forth herein (which offer to Lease
shall be irrevocable for twenty (20) business days following the date of delivery).

     28.17 No Counterclaim; Choice of Laws. It is mutually agreed that in the event Landlord
commences any summary proceeding for non-payment of Rent, Tenant will not interpose any
counterclaim of whatever nature or description in any such proceeding. Except for compulsory
counterclaims. In addition, Tenant hereby submits to local jurisdiction in the State of California
and agrees that any action by Tenant against Landlord shall be instituted in the State of
California and that Landlord shall have personal jurisdiction over Tenant for any action brought by
Landlord against Tenant in the State of California.

     28.18 Electrical Service to the Premises. Anything set forth in Section 7.01 or elsewhere in
this Lease to the contrary notwithstanding, electricity to the Premises shall not be furnished by
Landlord, but shall be furnished by the approved electric utility company serving the Building.
Landlord shall permit Tenant to receive such service directly from such utility company at Tenant’s
cost (except as otherwise provided herein) and shall permit Landlord’s wire and conduits, to the
extent available, suitable and safely capable, to be used for such purposes.

     28.19 Rights Reserved by Landlord. Landlord reserves the following rights exercisable without
notice (except as otherwise expressly provided to the contrary in this Lease) and without being
deemed an eviction or disturbance of Tenant’s use or possession of the Premises or giving rise to
any claim for set-off or abatement of Rent: (i) to change the name or street address of the
Building; (ii) to install, affix and maintain all signs on the exterior and/or interior of the
Building; (iii) to designate and/or approve prior to installation, all types of signs, window
shades, blinds, drapes, awnings or other similar items, and all internal lighting that may be
visible from the exterior of the Premises and, notwithstanding the provisions of Article IX, the
design, arrangement, style, color and general appearance of the portion of the Premises visible
from the exterior, and contents thereof, including, without limitation, furniture, fixtures, signs,
art work, wall coverings, carpet and decorations, and all changes, additions and removals thereto,
shall, at all times have the appearance of premises having the same type of exposure and used for
substantially the same purposes that are generally prevailing in comparable office buildings in the
area. Any violation of this provision shall be deemed a material breach of this Lease; (iv) to
change the arrangement of entrances, doors, corridors, elevators and/or stairs in the Building,
provided no such change shall materially adversely affect access to the Premises; (v) to grant any
party the exclusive right to conduct any business or render any service in the Building, provided
such exclusive right shall not operate to prohibit Tenant from using the Premises for the purposes

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permitted under this Lease; (vi) to prohibit the placement of vending or dispensing machines
of any kind in or about the Premises other than for use by Tenant’s employees; (vii) to prohibit
the placement of video or other electronic games in the Premises; (viii) to have access for
Landlord and other tenants of the Building to any mail chutes and boxes located in or on the
Premises according to the rules of the United States Post Office and to discontinue any mail chute
business in the Building; (ix) to close the Building after normal business hours, except that
Tenant and its employees and invitees shall be entitled to admission at all times under such rules
and regulations as Landlord prescribes for security purposes; (x) to install, operate and maintain
security systems which monitor, by close circuit television or otherwise, all persons entering or
leaving the Building; (xi) to install and maintain pipes, ducts, conduits, wires and structural
elements located in the Premises which serve other parts or other tenants of the Building; provided
that same are installed and maintained along exterior walls of the Premises and (xii) to retain at
all times master keys or pass keys to the Premises.

     28.20 First Right of Refusal Option. Tenant shall have the right of first refusal on suite
510 C, consisting of approximately 1,084 rentable square feet. If Tenant decides to exercise the
right of refusal, Tenant shall match the terms and conditions of any bona fide offer acceptable to
Landlord that Landlord receives on the said space. Tenant shall have 10 days to accept or reject
Landlord’s approved terms.

     28.21 Option to Extend. Tenant shall have an option to renew the Lease for all of the space
then under Lease for a successive term of five (5) years upon no less than six (6) months prior
written notice to Landlord to exercise such option. The Base Rental during each option period (the
“Renewal Term”) shall be of the then prevailing fair market rate, terms and conditions for
comparable building space within a two (2) mile radius in Encino.

37

 

IN WITNESS WHEREOF, the parties hereto have executed this lease as of the date first above written.

	 	 	 	 	 	 	 
	LANDLORD	 	TENANT:
	 
	 	 	 	 	 	 
	16501 Ventura LLC	 	All American Pet Company, Inc.
	c/o Jamison Properties, Inc.	 	A New York Corporation
	 
	 	 	 	 	 	 
	By:

	 	/s/ Tae K. Nam
	 	By:
	 	/s/ Barry Schwartz
	 

	 	 
	 	 	 	 
	Its:

	 	Regional Manager
	 	Its:
	 	President
	Date:

	 	January 19, 2005
	 	Date:
	 	 January 19, 2005

 

 

EXHIBIT A

FLOOR PLAN

(Floor Plan in the form of a graphic is hereby attached)

 

 

EXHIBIT B

WORK LETTER AGREEMENT

[Landlord Performs Work]

     THIS AGREEMENT made as of the January 14, 2005, between 16501 Ventura LLC, a California
Limited Liability Company, as (“Landlord”) and All American Pet Company, Inc. (“Tenant”).

     Reference is made to the Lease dated November 24, 2004 (the “Lease”) for premises known as
Encino Executive Plaza, Suite 510 (the “Premises”), located in the property known 16501 Ventura
Blvd., Encino California 91436 (the “Property”).

     Landlord, at Landlord’s sole cost, shall:

	 	1.	 	Provide and install new building standard carpet in the area as indicated on
Exhibit “A”.
	 
	 	2.	 	Provide a door for the equipment room.
	 
	 	3.	 	Remove wallpaper and paint throughout the Premises.

     Furthermore, Landlord shall give Tenant rent credit of $4,000 for Tenant’s data cabling and
$800 for wood staining. The documentation of payment for data cabling and wood staining must be
provided to Landlord before any rent credit is given.

     Landlord will use reasonable efforts to complete the Work by the Commencement Date under the
Lease or within 60 days thereafter, subject to further delays beyond Landlord’s reasonable control
(as may be further described in the Lease); provided, notwithstanding anything to the contrary
contained in the Lease, delays in the Work hereunder shall not postpone the commencement of Rent
under any circumstances whether the delay is caused by Tenant or Tenant’s contractors, agents or
employees, or the delay is otherwise beyond Landlord’s reasonable control (as may be further
described in the Lease), or for any other reason whatsoever. Tenant acknowledges that the Work may
occur during normal business hours while Tenant is in occupancy of the Premises and that no
interference to Tenant’s business operations in, or use of, the Premises shall entitle Tenant to
any abatement of rent or any other concession, or give rise to any claim against, or liability of,
Landlord.

     Notwithstanding anything to the contrary contained in this Work Letter, it is expressly
understood and agreed by and between the parties hereto that: (a) The recourse of Tenant or its
successors or assigns against Landlord with respect to the alleged breach by or on the part of
Landlord of any representation, warranty, covenant, undertaking or agreement contained in this Work
Letter (collectively, “Landlord’s Work Letter Undertakings”) shall extend only to Landlord’s
interest in the real estate of which the Premises demised under the Lease are a part (hereinafter,
“Landlord’s Real Estate”) and not to any other assets of Landlord or its beneficiaries; and (b)
Except to the extent of Landlord’s interest in Landlord’s Real Estate, no personal liability or
personal responsibility of any sort with respect to any of Landlord’s Work

 

 

Letter Undertakings or any alleged breach thereof is assumed by, or shall at any time be
asserted or enforceable against, Landlord, or against any of their respective directors, officers,
shareholders, employees, agents, constituent partners, beneficiaries, trustees or representatives.

	 	 	 	 	 	 	 
	 	 	LANDLORD:	 	 
	 
	 	 	 	 	 	 
	 	 	16501 Ventura LLC,	 	 
	 	 	c/o Jamison Properties, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Its:
	 	     /s/ Tae K. Nam
 

Regional Manager
	 	 
	 

	 	Date:
	 	January 19, 2005	 	 
	 
	 	 	 	 	 	 
	 	 	TENANT:	 	 
	 
	 	 	 	 	 	 
	 	 	All American Pet Company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Its:
	 	     /s/ Barry Schwartz
 

President
	 	 
	 

	 	Date:
	 	January 19, 2005	 	 

 

 

SCHEDULE 1

COPIES OF INITIAL PLAN

Intentionally omitted

 

 

EXHIBIT C

RULES AND REGULATIONS

     1. The sidewalks, entrances, passages, courts, elevators, vestibules, stairways, corridors or
halls shall not be obstructed or used for any purpose other than ingress and egress. The halls,
passages, entrances, elevators, stairways, balconies and roof are not for the use of the general
public, and Landlord shall in all cases retain the right to control or prevent access thereto by
all persons whose presence in the judgment of Landlord shall be prejudicial to the safety,
character, reputation or interests of Landlord and its tenants, provided that nothing herein
contained shall be construed to prevent such access by persons with whom the tenant normally deals
in the ordinary course of its business unless such persons are engaged in illegal activities. No
tenant and no employees of any tenant shall go upon the roof of the Building without the written
consent of Landlord.

     2. No awnings or other projections shall be attached to the outside walls or surfaces of the
Building nor shall the interior or exterior of any windows be coated without the prior written
consent of Landlord. Except as otherwise specifically approved by Landlord, all electrical ceiling
fixtures hung in offices or spaces along the perimeter of the Building must be fluorescent and of a
quality, type, design and bulb color approved by Landlord. Tenant shall not place anything or
allow anything to be placed near the glass of any window, door, partition or wall which may appear
unsightly from outside the Premises.

     3. No sign, picture, plaque, advertisement, notice or other material shall be exhibited,
painted, inscribed or affixed by any tenant on any part of, or so as to be seen from the outside
of, the Premises or the Building without the prior written consent of Landlord. In the event of
the violation of the foregoing by any tenant, Landlord may remove the same without any liability,
and may charge the expense incurred in such removal to the tenant violating this rule. Interior
signs on doors and the directory tablet shall be inscribed, painted or affixed for each tenant by
Landlord at the expense of such tenant, and shall be of a size, color and style acceptable to
Landlord.

     4. The toilets and wash basins and other plumbing fixtures shall not be used for any purpose
other than those for which they were constructed, and no sweepings, rubbish, rags or other
substances shall be thrown therein. All damage resulting from any misuse of the fixtures shall be
borne by tenant who, or whose servants, employees, agents, visitors or licensees, shall have caused
the same.

     5. No tenant or its officers, agents, employees or invitees shall mark, paint, drill into, or
in any way deface any part of the Premises or the Building. No boring, cutting or stringing of
wires or laying of linoleum or other similar floor coverings shall be permitted except with the
prior written consent of Landlord and as Landlord may direct.

     6. No bicycles, vehicles or animals of any kind shall be brought into or kept in or about the
Premises and no cooking shall be done or permitted by any tenant on the Premises except that
microwave cooking in a UL-approved microwave oven and the preparation of coffee, tea, hot chocolate
and similar items for the tenant and its employees and business visitors shall
be permitted. Tenant shall not cause or permit any unusual or objectionable odors to escape
from the Premises.

 

 

     7. The Premises shall not be used for manufacturing or for the storage of merchandise except
as such storage may be incidental to the use of the Premises for general office purposes. No
tenant shall engage or pay any employees on the Premises except those actually working for such
tenant on the Premises nor advertise for laborers giving an address at the Premises. The Premises
shall not be used for lodging or sleeping or for any immoral or illegal purposes.

     8. No tenant or its officers, agents, employees or invitees shall make, or permit to be made
any unseemly or disturbing noises, sounds or vibrations or disturb or interfere with occupants of
this or neighboring buildings or Premises or those having business with them whether by the use of
any musical instrument, radio, phonograph, unusual noise, or in any other way.

     9. No tenant or its officers, agents, employees or invitees shall throw anything out of doors,
balconies or down the passageways.

     10. Tenant shall not maintain armed security in or about the Premises nor possess any weapons,
explosives, combustibles or other hazardous devices in or about the Building and/or Premises.

     11. No tenant or its officers, agents, employees or invitees shall at any time use, bring or
keep upon the Premises any flammable, combustible, explosive, foul or noxious fluid, chemical or
substance, or do or permit anything to be done in the leased Premises, or bring or keep anything
therein, which shall in any way increase the rate of fire insurance on the Building, or on the
property kept therein, or obstruct or interfere with the rights of other tenants, or in any way
injure or annoy them, or conflict with the regulations of the Fire Department or the fire laws, or
with any insurance policy upon the Building, or any part thereof, or with any rules and ordinances
established by the Board of Health or other governmental authority.

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

     13. All removals, or the carrying in or out of any safes, freight, furniture, or bulky matter
of any description must take place during the hours which Landlord may determine form time to time.
The moving of safes or other fixtures or bulky matter of any kind must be made upon previous
notice to the manager of the Building and under his or her supervision, and the persons employed by
any tenant for such work must be acceptable to Landlord. Landlord reserves the right to inspect
all safes, freight or other bulky articles to be brought into the Building and to exclude from the
Building all safes, freight or other bulky articles which violate

 

 

any of these Rules and Regulations or the Lease of which these Rules and Regulations are a
part. Landlord reserves the right to prohibit or impose conditions upon the installation in the
Premises of heavy objects which might overload the building floors. Landlord will not be
responsible for loss of or damage to any safes, freight, bulky articles or other property from any
cause, and all damage done to the Building by moving or maintaining any such safe or other property
shall be repaired at the expense of the tenant.

     14. No tenant shall purchase or otherwise obtain for use in the Premises water, ice, towel,
vending machine, janitorial, maintenance or other like services, or accept barbering or
bootblacking services, except from persons authorized by Landlord, and at hours and under
regulations fixed by Landlord.

     15. Landlord shall have the right to prohibit any advertising by any tenant which, in
Landlord’s opinion, tends to impair the reputation of the Building or its desirability as an office
building and upon written notice from Landlord any tenant shall refrain from or discontinue such
advertising. No tenant shall use any graphic image of the Building or any part of the Building for
advertising or public relations without Landlord’s written permission.

     16. Landlord reserves the right to exclude from the Building between the hours of 10:00 p.m.
and 7:00 a.m. and at all hours of Saturdays, Sundays and legal holidays all persons who do not
present a pass signed by Landlord. Landlord shall furnish passes to persons for whom any tenant
requests the same in writing. Each tenant shall be responsible for all persons for whom he
requests passes and shall be liable to Landlord for all acts of such persons. Landlord shall in no
case be liable for damages for any error with regard to the admission to or exclusion from the
Building of any person. In the case of invasion, mob, riot, public excitement or other commotion,
Landlord reserves the right to prevent access to the Building during the continuance of the same,
by closing of the gates and doors or otherwise, for the safety of the tenants and others and the
protection of the Building and the property therein.

     17. Any outside contractor employed by any tenant, shall, while in the Building, be subject to
the prior written approval of Landlord and subject to the Rules and Regulations of the Building.
Tenant shall be responsible for all acts of such persons and Landlord shall not be responsible for
any loss or damage to property in the Premises, however occurring.

     18. All doors opening onto public corridors shall be kept closed, except when in use for
ingress and egress, and left locked when not in use.

     19. The requirements of tenants will be attended to only upon application to the Office of the
Building.

     20. Canvassing, soliciting and peddling in the Building are prohibited and each tenant shall
cooperate to prevent the same.

     21. All office equipment of any electrical or mechanical nature shall be placed by tenants in
the Premises in setting approved by Landlord, to absorb or prevent any vibration, noise or
annoyance.

 

 

     22. No air conditioning unit or other similar apparatus shall be installed or used by any
tenant without the written consent of Landlord.

     23. There shall not be used in any space, or in the public halls of the Building either by any
tenant or others, any hand trucks except those equipped with rubber tires and side guards.

     24. Landlord will direct electricians as to where and how telephone and telegraph wires are to
be introduced. No boring or cutting for wires or stringing of wires will be allowed without
written consent of Landlord. The location of telephones, call boxes and other office equipment
affixed to the Premises shall be subject to the approval of Landlord. All such work shall be
effected pursuant to permits issued by all applicable governmental authorities having jurisdiction.

     25. No vendor with the intent of selling such goods shall be allowed to transport or carry
beverages, food, food containers, etc., on any passenger elevators. The transportation of such
items shall be via the service elevators in such manner as prescribed by Landlord.

     26. Tenants shall cooperate with Landlord in the conservation of energy used in or about the
Building, including without limitation, cooperating with Landlord in obtaining maximum
effectiveness of the cooling system by closing drapes or other window coverings when the sun’s rays
fall directly on windows of the Premises, and closing windows and doors to prevent heat loss.
Tenant shall not obstruct, alter or in any way impair the efficient operation of Landlord’s
heating, lighting, ventilating and air conditioning system and shall not place bottles, machines,
parcels or any other articles on the induction unit enclosure so as to interfere with air flow.
Tenant shall not tamper with or change the setting of any thermostats or temperature control
valves, and shall in general use heat, gas, electricity, air conditioning equipment and heating
equipment in a manner compatible with sound energy conservation practices and standards.

     27. All parking ramps and areas, pedestrian walkways, plazas, and other public areas forming a
part of the Building shall be under the sole and absolute control of Landlord with the exclusive
right to regulate and control these areas. Tenant agrees to conform to the rules and regulations
that may be established by Landlord for these areas from time to time.

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

     29. Tenant and its employees, agents, subtenants, contractors and invitees shall comply with
all applicable “no-smoking” ordinances and, irrespective of such ordinances, shall not smoke or
permit smoking of cigarettes, cigars or pipes outside of Tenant’s Premises (including plaza areas)
in any portions of the Building except areas specifically designated as smoking areas by Landlord.
If required by applicable ordinance, Tenant shall provide smoking areas within Tenant’s Premises.

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