Document:

<PAGE>
                                                                   Exhibit 10.16

      AGREEMENT OF LEASE dated as of February 10, 2006 between TM PARK AVENUE
LLC, a New York Limited Liability Company having an office at 315 Park Avenue
South, New York, New York 10010 (hereinafter called "Landlord") and Epsilon
Interactive, LLC a Limited Liability Company organized under the laws of
Delaware, having offices at 315 Park Avenue South, 18th Floor, New York, NY
10010 (hereinafter called "Tenant").

                             W I T N E S S E T T H:

                                    ARTICLE 1

                       Premises, Term and Rent; Condition
                       of Premises; Landlord's Work; Etc.

            Section 1.0l. Landlord leases to Tenant, and Tenant hires from
Landlord, subject to any ground leases and/or underlying leases and/or mortgages
as hereinafter provided in Section 24.01, and upon and subject to the covenants,
agreements, terms, provisions and conditions of this lease, for the term
hereinafter stated, that portion of the building (hereinafter called the
"Building") known as 315 Park Avenue South, New York, New York, consisting of
the easterly portion of the nineteenth floor as set forth and designated as
"Epsilon Space" on the diagram marked Exhibit A, attached hereto which diagram
is an integral part of this lease (except for common areas, including, without
limitation, areas devoted to elevator shafts and conduits for mechanical
systems, which common areas Tenant shall have non-exclusive right to use with
other Building occupants). Such leased Premises, together with all fixtures,
equipment, installations and appurtenances which at the commencement of or
during the term of this lease are thereto attached (except items not deemed to
be included therein and removable by Tenant as provided in Article 4 of this
lease) are hereinafter called the "Premises". The plot of land on which the
Building is erected is hereinafter called the "Land". This agreement is called
the "Lease".

            Section 1.02. This lease shall commence on February 15th, 2006 (The
"Commencement Date") unless the Commencement Date is delayed as set forth herein
and shall expire, unless same shall sooner cease or be terminated as hereinafter
provided or pursuant to law, on August 31, 2008 (such term being hereinafter
referred to as the "Term").The actual Commencement Date shall be five (5) days
after the Landlord provides written notice to the Tenant that it has
substantially completed the Landlord's Work set forth in Section 27.22 and
described in Exhibit B to this lease. Substantially completed shall mean the
Landlord has completed its work according to the agreed upon specifications and
according to any applicable codes.

            Section 1.03. The rent reserved under this lease for the term shall
be a fixed annual rent (hereinafter called the "Fixed Rent") as follows:

               (a) At the annual rate of $420,000 per annum for the period from
and including February 15th , 2006 to and including August 31, 2008 and at such
rate to be paid in

<PAGE>

equal monthly installments of $35,000 each, in advance, on the first day of each
and every calendar month during the entirety of such period (plus such
Additional Rent and other charges as shall become due and payable hereunder).
The rent for the period February 15, 2006 through March 31, 2006 which is equal
to $52,500 shall be paid to Landlord upon execution of this lease. Should the
Commencement Date be a date later than the February 15, 2006 then the cost paid
under the preceding sentence shall be credited in part or whole, as the case may
be, to the following month's rent payment, which shall be adjusted according to
the actual Commencement Date.

            Section 1.04. Tenant agrees promptly to pay the Fixed Rent,
Additional Rent and other charges herein reserved as and when the same shall
become due and payable, without demand therefor, and without any set-off or
deduction whatsoever except as expressly provided in the Lease and to keep,
observe and perform, and to permit no violation of, each and every of the
covenants, agreements, terms, provisions and conditions herein contained on the
part and on behalf of Tenant to be kept, observed and performed. Any rental
payment that is due under this Lease shall, if not received by Landlord by the
tenth day of the month bear five (5%) percent surcharge for the late payment.

            Section 1.05. Additional Rent shall mean all charges owed pursuant
to Sections 16.02, 16.04, 19.01, 21.04, 23.02, 23.03 and 23.04 and such other
Sections of similar purport.

            Section 1.06. If, by reason of any of the provisions of this lease,
the term hereof expires on any date other than the last day of a calendar month
(except if the term terminates by reason of Tenant's default hereunder), the
Fixed Rent and Additional Rent for such calendar month shall be equitably
prorated. If the Commencement day of the Lease is any day other than the first
of a calendar month, the Fixed and Additional Rent for that first month shall be
equitably prorated.

            Section 1.07. For all purposes hereof, it is agreed between the
Landlord and the Tenant that the Premises consists of 12,000 square feet.

            Section 1.08. Tenant agrees to accept possession of the Premises in
its "as is" physical condition and state of repair, upon substantial completion
of the Landlord's Work as set forth in Section 27.22 and described in Exhibit B.

                                    ARTICLE 2

                  Rent after lease expiration; Security Deposit

            Section 2.01. If Tenant holds over beyond the Term, Tenant shall pay
Landlord as use and occupancy, during the period that Tenant holds over an
amount equal the sum

                                     - 2 -
<PAGE>

of one hundred fifty (150%) percent of the Fixed and one hundred (100%) percent
of the Additional Rent.

            Section 2.02. (a) Tenant shall deposit with Landlord upon the
execution of this Lease $35,000 as security for its obligations under this
lease.

                                    ARTICLE 3

                                 Use of Premises

            Section 3.01. The Premises shall be used and occupied for executive
and general offices, by and for Tenant, or affiliate of Tenant and by and for
permitted assignees, subtenants and licensees and uses ancillary thereto in
connection with Tenants' business and for no other purpose. Tenant agrees that
it shall not use the Premises or any part thereof, or suffer or permit the
Premises or any part thereof to be used, for any purposes other than as set
forth in the first sentence of this Section 3.01.

            Section 3.02. Tenant agrees that it shall not use or suffer or
permit the use of the Premises or any part thereof in any way which would
violate any of the covenants, agreements, terms, provisions and conditions of
this lease or for any unlawful purposes or in any unlawful manner and Tenant
shall not suffer or permit the Premises or any part thereof to be used in any
manner or anything to be done therein or anything to be brought into or kept
therein which, in the reasonable judgment of Landlord, would in any way impair
or unreasonably interfere with any of the Building systems or the proper and
economic heating, cleaning, air conditioning or other similar servicing of the
Building or the Premises (to the extent that same or any of same are to be
furnished to the Premises), or impair or unreasonably interfere with the use of
any of the other areas of the Building by, or occasion discomfort, inconvenience
or annoyance to, any of the other tenants or occupants of the Building.

            Section 3.03. If any governmental license or permit shall be
required for the proper and lawful conduct of Tenant's business or other
activity carried on in the Premises, and if the failure to secure such license
or permit might or would, in any way, affect Landlord, then Tenant at Tenant's
sole cost and expense, shall duly procure the same and make the same available
to inspection by Landlord. Tenant, at Tenant's sole cost and expense, shall at
all times, comply with the requirements of each such license or permit.
Notwithstanding anything in this lease to the contrary, Tenant shall not have
any obligation to secure, or pay for, any license or permit for work which
Landlord is responsible to perform in or about the Premises or the Building.

            Section 3.04 Landlord represents that the Certificate of Occupancy
allows for use of the Premises as general offices.

                                     - 3 -
<PAGE>

                                    ARTICLE 4

                     Appurtenances, Etc., Not to be Removed

            Section 4.01. All fixtures, equipment, installations and
appurtenances attached to or built into the Premises (hereinafter severally and
collectively called, in this Section 4.01, "Appurtenances" other than trade
fixtures and equipment) at the commencement of or during the term, whether or
not furnished or installed at the expense of Tenant or by Tenant, shall be and
remain part of the Premises and be deemed the property of Landlord and shall not
be removed by Tenant, except as otherwise expressly provided in this lease.
Without limiting the generality of the next preceding sentence, all electric,
plumbing, heating, sprinkler, dumbwaiter and elevator systems, fixtures and
outlets, venetian blinds, partitions, railings, gates, doors, stairs, paneling,
cupboards (whether or not recessed in paneling), molding, shelving, radiator
enclosures, cork, rubber, tile and composition floors, and ventilating,
silencing, air conditioning and cooling equipment shall be deemed to be
Appurtenances, whether or not attached to or built into the Premises. Anything
hereinbefore in this Article 4 contained to the contrary notwithstanding, any
Appurtenances furnished and installed in any part of the Premises (whether or
not attached thereto or built therein) at the sole cost and expense of Tenant
may be removed from the Building by Tenant prior to the expiration of the term
hereof. Tenant shall repair and restore, in a good and workmanlike manner,
substantially to its condition prior to the furnishing or installation of any
such Appurtenances any damages to the Premises or the Building caused by such
removal. If any Appurtenance which as aforesaid may be removed from the Building
by Tenant is not removed by Tenant from the Building within the time above
specified therefor, deemed that the same has been abandoned by Tenant to
Landlord. Tenant shall not be responsible to remove any Appurtenances which it
has notified the Landlord in writing prior to vacating the Premises that it is
abandoning.

            Section 4.02. All the perimeter walls of the Premises, any
balconies, terraces or roofs adjacent to the Premises, and any space in and/or
adjacent to the Premises presently used for shafts, stairways, stacks, pipes,
vertical conveyors, mail chutes, pneumatic tubes, conduits, ducts, electric or
other utilities, rooms containing elevator or air conditioning machinery and
equipment, sinks, or other Building facilities, and the use thereof, as well as
reasonable access thereto through the Premises for the purpose of such use and
the operation, improvement, replacement, addition, repair, maintenance and/or
decoration thereof, are expressly reserved to Landlord; provided, however, that
Tenant may decorate the interior sides of the perimeter walls of the Premises.

                                     - 4 -
<PAGE>

                                    ARTICLE 5

                                Various Covenants

            Section 5.01. Tenant represents, warrants and covenants that Tenant
will:

               (a) Subject to the provisions of Articles 6, 7 and 8 of this
lease, take good care of the Premises, and, at Tenant's sole cost and expense,
(i) make all interior non-structural repairs (other than repairs occasioned by
acts of Landlord, its agents, servants or employees, tenants or other occupants
of the building) thereto as may be required to keep the Premises in good order
and condition, and (ii) pay to Landlord the expense of making good any injury,
damage or breakage to the Premises done by or on behalf of Tenant at the
expiration of the Lease except if required by municipal law or regulation to be
repaired at an earlier date.

               (b) Faithfully observe and comply with the rules and regulations
annexed hereto and such additional reasonable rules and regulations of general
applicability to the Building as Landlord hereafter at any time or from time to
time may make and may communicate in writing to Tenant, provided, however, that
(i) in the case of any conflict between the provisions of this lease and any
such rule or regulation, the provisions of this lease shall control, (ii)
nothing contained in this lease shall be construed to impose upon Landlord any
duty or obligation to enforce the rules and regulations or the terms, covenants
or conditions in any other lease as against any other tenant.

               (c) Permit Landlord and any mortgagee of the Building and/or the
Land or of the interest of Landlord therein and any lessor under any ground or
underlying lease, and their representatives, to enter the Premises at all
reasonable hours, using best efforts to give Tenant 24-hours' notice, for the
purposes of inspection, or of making necessary or required repairs, replacements
or improvements in or to the Building or equipment, or of making repairs in or
to the Premises, or of complying with all laws, orders and requirements of
governmental or other authority or of exercising any right reserved to Landlord
by this lease (including the right during the progress of such repairs,
replacements or improvements or while performing work and furnishing materials
in connection with compliance with any such laws, orders or requirements, to
keep and store within the Premises all necessary materials, tools and equipment
to the extent necessary and that no responsible alternate space is available to
Landlord. Performance of such work shall be done in a manner which attempts to
minimize disruption to Tenant's business in and access to the Premises).

                                     - 5 -
<PAGE>

               (d) Make no claim against Landlord or any lessor under any ground
or underlying lease for any loss of or damage to any property of Tenant or
others by theft or any injury or damage to Tenant or other persons or property
resulting from fire, explosion, falling plaster, steam, gas, electricity, water,
rain or snow or leaks from any part of the Building or from the pipes,
appliances or plumbing works or from the roof, street or sub-surface or from any
other place or by dampness or by any other cause of whatsoever nature, or any
such damage caused by other tenants or persons in the Building or caused by
construction of any private work unless caused by or due to the willful acts or
omissions or the negligence of Landlord, its agents, servants, or employees or
contractors. No property other than such as might normally be brought upon or
kept in the Premises as an incident to the reasonable use of the Premises for
the purposes specified in this lease shall be brought upon or kept in the
Premises.

               (e) Make no alterations, decorations, installations, repairs,
additions, improvements or replacements (hereinafter collectively called "Tenant
Changes") in, to or about the Premises except as provided in this clause (e):

                  (i) No Tenant's Changes costing more than $50,000.00 shall be
made without Landlord's prior consent, and then only by contractors or mechanics
approved by Landlord, such consent and approval to changes and contractors not
to be unreasonably conditioned withheld or delayed. All contractors or
mechanics, no matter the amount of the contract, shall provide the Landlord,
prior to commencing work, with a copy of their worker's compensation certificate
and their liability insurance policy naming the Landlord as an insured.

                  (ii) Tenant's Changes shall be done at Tenant's sole cost and
expense and at such times, and in such manner so as to not unreasonably
discomfort, inconvenience or annoy Landlord or any other tenant of the Building
(it being acknowledged that the performance of Tenant's Changes may involve some
such discomfort, inconvenience or annoyance);

                  (iii) Prior to the commencement of any Tenant's Change
expected to cost more than $50,000.00, Tenant shall notify Landlord that it
intends to undertake Tenant's Changes and shall generally describe to Landlord
the nature of any such proposed Tenant's Changes, including Tenant's reasonably
estimated cost therefor; within 10 days after any such notice, Landlord shall
advise Tenant whether or not it shall require the submission of plans and
specifications therefor, for Landlord's approval; if Landlord advises Tenant
within such time that it shall not require such submission or if Landlord fails
to advise Tenant within such time whether or not it shall require such
submission, such submission shall not be required; if Landlord advises Tenant
within such time that such submission shall be required, then prior to the
commencement of such proposed Tenant's Changes, Tenant shall submit to Landlord,
for Landlord's approval, plans

                                     - 6 -
<PAGE>

and specifications (to be prepared by and at the sole cost and expense of
Tenant) of such proposed Tenant's Changes in detail reasonably satisfactory to
Landlord; and in any case in which Landlord requires the submission of any such
plans and specifications, (A) the proposed Tenant's Changes provided for in such
plans and specifications shall not be undertaken until Landlord has approved
same, and such proposed Tenant's Changes shall not be continued pursuant to
amendments or additions to such plans and specifications until Landlord has
approved such amendments or additions, and (B) Landlord's approval shall be
deemed given if Landlord has not given Tenant notice of objection to such plans
and specifications, or to such amendments or additions, as the case may be,
within fifteen (15) days after same, respectively, have been submitted to
Landlord, such notice of objection to specify in reasonable detail the nature
thereof;

                  (iv) In no event shall any material or equipment (except for
communication, word processing and computer equipment or any other equipment
used in Tenant's normal operations) be incorporated in or to the Premises in
connection with any such Tenant's Changes which is subject to any lien, security
agreement, charge, mortgage or other encumbrance of any kind whatsoever or is
subject to any conditional sale or other similar or dissimilar title retention
agreement;

                  (v) Any mechanic's lien filed against the Premises or the
Building for work done for, or claimed to have been done for, or materials
furnished to, or claimed to have been furnished to, Tenant shall be discharged
by Tenant within 30 days after Tenant receives notice of the same, at Tenant's
expense, by filing the bond required by law or otherwise; and

                  (vi) All Tenant's Changes shall at all times comply with (A)
laws, rules, orders and regulations of governmental authorities having
jurisdiction thereof, (B) reasonable rules and regulations of Landlord, and (C)
to the extent required by Section 5.01(e), plans and specifications as
aforesaid, or amendments or additions thereto as aforesaid, approved or deemed
approved by Landlord.

               (f) Not violate, or permit the violation of, any condition
imposed by the standard fire insurance policy issued for office buildings in the
County or the City of New York and not to do anything or permit anything to be
done, or keep anything or permit anything to be kept, in the Premises, which
would increase the fire or other casualty insurance rate on the Building or the
property therein, or which would result in insurance companies of good standing
refusing to insure the Building or any such property in amounts and against
risks as reasonably determined by Landlord. If by reason of failure of Tenant to
comply with the provisions of this paragraph including but not limited to, the
use to which Tenant puts the Premises, the fire insurance rate shall at the
beginning of this lease or any time thereafter be higher than it otherwise would
be, then Tenant shall reimburse Landlord, as Additional Rent hereunder, for that
part of all fire insurance premiums thereafter paid by Landlord which shall have
been charged solely because of such failure or use by Tenant, and shall make
such reimbursement upon the first day of the month following such outlay by
Landlord. In any action or proceeding wherein Landlord and Tenant are parties, a
schedule or "make up" rate for the Building or the Premises issued by an
organization

                                     - 7 -
<PAGE>

making fire insurance rates for the Premises, shall be conclusive evidence of
charges in the fire insurance rate then applicable to the Premises.

               (g) Permit Landlord, at reasonable times and upon one day's prior
notice, to show the Premises to any lessor under any ground or underlying lease,
or any lessee or mortgagee, or any prospective purchaser, lessee, mortgagee, or
assignee of any mortgage of the Building and/or the land upon which the Building
is situate or of Landlord's interest therein, and their representatives, and
during the period of nine months next preceding the date of expiration of the
term thereof with respect to any part of the Premises similarly show any part of
the Premises, at reasonable times, to any person contemplating the leasing of
all or a portion of the same. Landlord will use best efforts not to disrupt the
business activities of the Tenant during such showings.

               (h) At the end of the term, quit and surrender to Landlord the
Premises broom-clean and in good order and condition, reasonable wear and tear,
obsolescence and damage by the elements excepted, and Tenant shall remove all of
its personal property, except as may be otherwise provided in Article 4 hereof.
Any personal property which shall remain in the Premises after the expiration or
termination of the term of this lease shall be deemed to have been abandoned,
and either may be retained by Landlord as its property or may be disposed of in
such manner as Landlord may see fit; provided, however, that, notwithstanding
the foregoing, Tenant will, upon request of Landlord made not later than 30 days
prior to the expiration or not later than the day before any termination of the
term hereof, promptly remove from the Building any such personal property at
Tenant's own cost and expense.

               (i) At any time and from time to time, but not more than twice
per year, upon not less than fifteen (15) days' prior notice by Landlord to
Tenant, execute, acknowledge and deliver to Landlord, or to anyone Landlord
shall designate, a statement of Tenant (or if Tenant is a corporation, an
appropriate officer of Tenant) in writing certifying 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 and modified and stating the
modifications), specifying the dates to which the Fixed Rent, Additional Rent
and other charges have been paid in advance, if any, and stating whether or not
to the best knowledge of the signer of such certificate Landlord is in default
in performance of any provision of this lease and, if so, specifying each such
default of which the signer may have knowledge, it being intended that any such
statement so delivered may be relied upon by any lessor under any ground or
underlying lease, or any lessee or mortgagee, or any prospective purchaser,
lessee, mortgagee, or assignee of any mortgage, of the Building and/or the Land
or Landlord's interest therein.

               (j) Not move any safe, heavy machinery, heavy equipment, bulky
matter or fixtures into or out of the Building without Landlord's prior consent,
which shall not be unreasonably withheld or delayed. If such safe, machinery,
equipment, freight of bulky matter or fixtures require special handling, Tenant
agrees to employ only persons holding a Master Rigger's License to do said work,
and that all work in connection therewith shall comply with the applicable

                                     - 8 -
<PAGE>

laws, orders and regulations of all governmental authorities having or asserting
jurisdiction over the Premises or the Building. Notwithstanding the consent of
Landlord and subject to the terms of Sections 8.03 and 8.04. Tenant shall
indemnify Landlord for, and hold Landlord harmless and free from, damages
sustained by persons or property and for any damages or monies paid out by
Landlord in settlement of any claims or judgments, as well as for all reasonable
costs and expenses and reasonable attorneys' fees incurred in connection with
Tenant's moving such heavy equipment, and occasioned by the acts of Tenant, its
agents, servants, employees, contractors, visitors or invitees and all costs
reasonably incurred in repairing any such damage to the Building or
appurtenances.

               (k) Unless attributable to the negligence or misconduct of
Landlord, its officers, directors, agents and employees. Indemnify, and save
harmless, Landlord and any mortgagee and any lessor under any ground or
underlying lease, and their respective officers, directors, agents and
employees, from and against any and all liability (statutory or otherwise),
claims, actions, suits, demands, damages, judgments, costs, interest and
expenses of any kind or nature of anyone whomsoever (including, but not limited
to, reasonable counsel fees and disbursements incurred in the defense of any
action or proceeding), to which they may be subject or which they may suffer by
reason of, or by reason of any claim for, any injury to, or death of, any person
or persons or damage to property (including any loss of use thereof) arising
from or in connection with the use of the Premises or from any work,
installation or thing whatsoever done, by Tenant, its employees, contractors,
agents, visitors, invitees, subtenants or licensees in the Premises during the
term of this lease or arising from any condition of the Premises due to or
resulting from any default by Tenant in the performance of Tenant's obligations
under this lease or from any act, omission, or negligence of Tenant or any of
Tenant's officers, directors, agents, contractors, employees, subtenants,
licensees or invitees.

               (l) Not clean, nor require, permit, suffer or allow any window in
the Premises to be cleaned, in violation of Section 202 of the Labor Law.

                                    ARTICLE 6

            Changes or Alterations by Landlord; Condition of Premises

            Section 6.01. Landlord reserves the right to make such changes,
alterations, additions, improvements, repairs or replacements in or to the
Building and the fixtures and equipment thereof, as well as in or to the street
entrances, halls, passages, elevators, escalators, stairways and other parts
thereof, all as Landlord may reasonably deem necessary or desirable providing
there shall be no substantial diminution of building services to the Premises or
of ingress or egress to and from the Premises. Landlord reserves the right to
erect, maintain and use pipes, ducts and conduits in and through the Premises,
all as Landlord may reasonably deem necessary or desirable. Any such changes or
the like referred to in the two immediately preceding sentences shall not
unreasonably interfere with Tenant's use or occupancy of the Premises, or
materially reduce the usable area of the Premises, (beyond 1% of the Premises)
any damage to the Premises resulting in the course of any such work shall be
corrected promptly at the sole cost and expense of Landlord to the extent such
correction is not inconsistent with the change or the like, and, with respect to
the

                                     - 9 -
<PAGE>

installation of pipes, ducts and conduits, same shall be concealed behind,
beneath or within partitioning, columns, ceilings or floors, to the maximum
extent possible, or completely furred at points immediately adjacent to any such
partitioning, columns or ceilings, and same shall not materially reduce the
usable area of the Premises. (beyond one (1%) percent of the Premises) Nothing
contained in this Article 6 shall relieve Tenant of any duty, obligation or
liability of Tenant under this Lease with respect to making any repair,
replacement or improvement or complying with any law, order or requirement of
any governmental or other authority.

            Section 6.02 The Landlord will deliver the Premises to the Tenant
vacant and free of tenancies on the Commencement Date. If Landlord fails to
deliver Premises to Tenant by April 1, 2006, Tenant shall have the right to
terminate this lease by written notice which shall be given no later than April
10, 2006 and upon receipt of such notice, Landlord shall refund to Tenant all
sums paid to Landlord under this lease.

            Section 6.03. Landlord reserves the right to name the Building and
to change the name or address of the Building at any time and from time to
time..

                                    ARTICLE 7

                             [Intentionally Omitted]

                                    ARTICLE 8

                              Damage by Fire, Etc.

            Section 8.01. If any part of the Premises shall be damaged by fire
or other casualty, Tenant shall give prompt notice thereof to Landlord and
Landlord shall proceed with reasonable diligence, and in a manner consistent
with the provisions of any ground or underlying lease and any mortgage affecting
the same or the Land and/or the Building or Landlord's interest therein, to
repair such damage, and if any part of the Premises shall be rendered
untenantable by reason of such damage, during the period that the Premises shall
be rendered untenantable by reason of such damage, the Fixed Rent and Additional
Rent payable hereunder shall be abated proportionately for the period from the
date of such damage to the date when the Premises or the damaged portion thereof
shall have been made tenantable and Tenant has been given notice at least ten
(10) days prior or to such earlier date upon which the full term of this lease
shall expire or terminate, unless such fire or other casualty resulted from the
negligence of Tenant or the employees, licensees or invitees of Tenant. Landlord
shall not be liable for any inconvenience or annoyance to Tenant or injury to
the business of Tenant resulting in any way from such damage or the repair
thereof, unless such inconvenience, annoyance or injury is occasioned by the
acts or

                                     - 10 -
<PAGE>

omissions of Landlord, its agents, servants, employees, contractors, visitors or
invitees. Tenant understands that Landlord will not carry insurance of any kind
on Tenant's Property, which term, as used herein, means, Tenant's goods,
furniture or furnishings or any fixtures, equipment, improvements, installations
or appurtenances removable by Tenant as provided in this lease, and that
Landlord shall not be obligated to repair any damage thereto or replace the
same. In the event that Tenant cannot move back into at least eighty (80%)
percent of its space within 60 days, which period may be extended for another 60
days as required by municipal agencies, Tenant may terminate this lease unless
Landlord has provided other space in the Building for Tenant to occupy
comparable in building size and quality. Landlord shall within ten (10) days of
casualty notify Tenant of estimated time to restore Premises, if it will take
more than ninety (90) days to restore or if damage occurs in the last year of
the Lease term, Tenant may terminate Lease.

            Section 8.02. Anything contained in Section 8.01 to the contrary
notwithstanding, if substantial alteration or reconstruction of the Building
(i.e. any alteration or reconstruction costing ten (10%) percent of the then
value of the Building) shall, in the reasonable opinion of Landlord, be required
as a result of damage by fire or other casualty, then this lease and the term
and estate hereby granted may be terminated by Landlord by its giving to Tenant,
within 30 days after the date of such damage, notice specifying a date, not less
than 90 days after the giving of such notice, for such termination. In the event
of the giving of such notice of termination, this lease and the term and estate
hereby granted shall expire as of the date specified therefor in such notice
with the same effect as if such date were the date hereinbefore specified for
the expiration of the full term of this lease, and the Fixed Rent and Additional
Rent payable hereunder shall be apportioned as of such date of termination,
subject to abatement, if any, as and to the extent provided in Section 8.01
hereof. At such time of termination Landlord will return any portion of Tenant's
Security Deposit minus reasonable reserves for Additional Rent that has not been
previously applied to Tenant's obligations under the Lease.

            Section 8.03. Each party agrees to endeavor to have included in each
of its fire insurance policies (insuring the Building and Landlord's property
therein, in the case of Landlord, and insuring Tenant's property in the
Premises, in the case of Tenant, against loss, damage or destruction by fire or
other casualty therein covered) a waiver of the insurer's right of subrogation
against the other party, or, if such waiver should be unobtainable or
unenforceable, (a) an express agreement that such policy shall not be
invalidated if the assured waives, before the casualty, the right of recovery
against any party responsible for a casualty covered by the policy or (b) if,
any other form of permission shall not be, or shall cease to be, obtainable (i)
without additional charge or (ii) at all, the insured party shall so notify the
other party promptly after learning thereof. In the first such case, if the
other party shall so elect and shall pay the insurer's additional charge
therefor, such waiver, agreement or permission shall be included in the policy.

            Section 8.04. Each party hereby releases the other party with
respect to any claim (including a claim for negligence) which it might otherwise
have against the other party for loss, damage or destruction with respect to its
property occurring during the term of this lease to the extent to which it is
insured for such loss, damage or destruction under a policy or policies
containing a waiver of subrogation or permission to release liability, as
provided in Section 8.03

                                     - 11 -
<PAGE>

hereof. If, notwithstanding the recovery of insurance proceeds by either party
for such loss, damage or destruction of its property, the other party is liable
to the first party with respect thereto or is obligated under this lease to make
replacement, repair or restoration or payment, then (provided the first party's
right of full recovery under its insurance policies is not thereby prejudiced or
otherwise adversely affected) the amount of the net proceeds of the first
party's insurance against such loss, damage or destruction shall be offset
against the second party's liability to the first party thereof, or shall be
made available to the second party to pay for replacement, repair or
restoration, as the case may be. Nothing contained in this Section 8.04 shall
relieve either party of any duty imposed elsewhere in this lease to repair,
restore or rebuild or to nullify any abatement of rent provided for elsewhere in
this lease.

            Section 8.05. This lease shall be considered an express agreement
governing any case of damage to or destruction of the Building or any part
thereof by fire or other casualty, and Section 227 of the Real Property Law of
the State of New York providing for such a contingency in the absence of express
agreement, and any other law of like import now or hereafter in force, shall
have no application in such case.

                                    ARTICLE 9

                                  Condemnation

            Section 9.01 In the event that the whole of the Premises shall be
lawfully condemned or taken in any manner for any public or quasi-public use,
this lease and the term and estate hereby granted shall forthwith cease and
terminate as of the date of vesting of title. In the event that only a
non-material part of the Premises (i.e. less than 15%) shall be so condemned or
taken, then, effective as of the date of vesting of title, the Fixed Rent and
Additional Rent hereunder shall be abated in an amount thereof apportioned
according to the area of the Premises so condemned or taken. In the event that
only a part of the Premises shall be so condemned or taken, then, Landlord may,
at Landlord's option, terminate this lease and the term and estate hereby
granted as of the date of such vesting of title by notifying Tenant of such
termination within 90 days following the date on which Landlord shall have
received notice of vesting of title. In the event that any portion of the
Premises shall be so condemned or taken, then, Tenant, at Tenant's sole option,
may terminate this lease and the term and estate hereunder granted as of the
date of such vesting of title by notifying Landlord of such termination within
90 days following the date on which Tenant shall have received notice of vesting
of title. If Tenant do not elect to terminate this lease, as aforesaid, this
lease shall be and remain unaffected by such condemnation or taking, except that
the Fixed Rent and Additional Rent payable hereunder shall be abated to the
extent, if any, hereinbefore provided in this Article 9. In the event that only
a part of the Premises shall be so condemned or taken and this lease and portion
of the Premises are not terminated as hereinbefore provided, Landlord will, with
reasonable diligence and at its expense, restore the remaining portion of the
Premises as nearly as practicable to the same condition as it was in prior to
such condemnation or taking, however, Landlord shall not be obligated to repair
any damage to Tenant's Property or replace the same.

                                     - 12 -
<PAGE>

            Section 9.02. In the event of a termination of this lease pursuant
to Section 9.01, this lease and the term and estate hereby granted shall expire
as of the date of such termination with the same effect as if that were the date
hereinbefore set for the expiration of the full term of this lease, and the
Fixed Rent and Additional Rent payable hereunder shall be apportioned as of such
date. At such time of termination Landlord will return any portion of Tenant's
Security Deposit minus reasonable reserves for Additional Rent that has not been
previously applied to Tenant's obligations under the Lease.

            Section 9.03. In the event of any condemnation or taking
hereinbefore mentioned of all or a part of the Building, Landlord shall be
entitled to receive the entire award in the condemnation proceeding, including
any award made for the value of the estate vested by this lease in Tenant, and
Tenant assigns to Landlord any and all right, title and interest of Tenant now
or hereafter arising in or to any such award or any part thereof, Tenant not
being entitled to receive any part of such award. The foregoing shall not
prohibit Tenant's independent claim for the value of Tenant's trade fixtures and
moving expenses and any other claim permitted under law.

            Section 9.04 It is expressly understood and agreed that the
provisions of this Article 9 shall not be applicable to any condemnation or
taking for governmental occupancy for a limited period.

                                   ARTICLE 10

                              Compliance with Laws

            Section 10.01. Tenant, at Tenant's sole cost and expense, shall
comply with all laws and ordinances, and all rules, orders and regulations of
all governmental authorities and of all insurance bodies, at any time duly
issued or in force, applicable to the Premises or any part thereof or to
Tenant's use thereof, except that Tenant shall not hereby be under any
obligation to comply with any law, ordinance, rule, order or regulation
requiring any structural alteration of or in connection with the Premises
(including without limitation, any alteration of or to the electricity,
plumbing, HVAC and sprinkler systems), unless such alteration is required by
reason of a condition which has been created by, or at the instance of Tenant,
or is attributable to any use to which Tenant puts the Premises, if same is not
permitted by the terms of this lease, or is required by reason of a breach of
any of Tenant's covenants and agreements hereunder. Where any structural
alteration of or in connection with the Premises is required by any such law,
ordinance, rule, order or regulation, and, by reason of the express exception
herein above contained, Tenant is not under any obligation to make such
alteration, then Landlord shall make such alteration and pay the cost thereof,
unless the reasonable estimated cost of such alteration is greater than
$200,000.00 or more in which case Landlord shall have the option of either
making such alteration at its own expense or terminating this lease and the term
and estate hereby granted by giving to Tenant not less than 120 days' prior
notice
<PAGE>

of such termination, provided, however, that if within 15 days after the giving
by Landlord of its notice of termination as aforesaid, Tenant shall give notice
to Landlord stating that Tenant elects to make such alteration at the sole cost
and expense of Tenant, then such notice of termination shall be ineffective
provided that Tenant, at Tenant's sole cost and expense, shall concurrently with
the giving of such notice to Landlord execute and deliver to Landlord Tenant's
written undertaking, with a surety and in form and substance reasonably
satisfactory to Landlord, obligating Tenant to promptly and duly make such
alteration in a manner reasonably satisfactory to Landlord and to save Landlord
harmless from any and all costs, expenses, penalties and/or liabilities
(including, but not limited to, accountants' and attorneys' fees) in connection
therewith or by reason thereof; and Tenant covenants and agrees that, after so
electing to make any such alteration, Tenant will, at Tenant's sole cost and
expense, and in compliance with all the covenants, agreements, terms, provisions
and conditions of this lease, including but not limited to, Section 5.01(b)
hereof, make such alteration and Tenant, at Tenant's sole cost and expense, will
promptly and duly perform all the conditions of such undertaking which shall be
deemed to constitute provisions of this lease to be kept or performed on the
part of Tenant with the same force and effect as if same had been set forth
herein.

            Section 10.02. In the event that a notice of termination shall be
given by Landlord under the provisions of this Article 10 and such notice shall
not become ineffective as hereinbefore provided, this lease and the term and
estate hereby granted shall expire as of the date specified therefore in such
notice with the same effect as if that were the date hereinbefore set for the
expiration of the full term of this lease, and the Fixed Rent and Additional
Rent payable hereunder shall be apportioned as of such date of termination. In
addition, Landlord will return any portion of Tenant's Security Deposit minus
reasonable reserves for Additional Rent that has been previously applied to
Tenant's obligations under the Lease.

                                   ARTICLE 11

                                     Notices

            Section 11.01. (A) Except as otherwise expressly provided in this
Lease, any bills, statements, consents, notices, demands, requests or other
communications given or required to be given under this Lease ("Notice(s)")
shall be in writing and shall be deemed sufficiently given or rendered if
delivered by hand (against a signed receipt) or if deposited in a securely
fastened, postage prepaid envelope in a depository that is regularly maintained
by the U.S. Postal Service, sent by registered or certified mail (return receipt
requested) and in either case addressed:

            if to Tenant, Attn: Chief Financial Officer (a) at Tenant's address
set forth in this Lease, or (b) at any place where Tenant or any agent or
employee of Tenant may be found if given subsequent to Tenant's vacating,
deserting, abandoning or surrendering such address, with a copy to Att: Legal
Counsel, Epsilon 2410 Gateway Drive, Irving, Texas 75063 or if to Landlord, at
Landlord's address set forth in this Lease, Attn: Joseph Mizrachi, with a copy
to Raphael and Marks, Attn: Stephen M. Raphael, at 315 Park Avenue South, 19th
Floor, New York, NY 10010.

                                     - 14 -
<PAGE>

(c) any Mortgagee who may have requested the same, by Notice given in accordance
with the provisions of this Article 11, at the address designated by such
Mortgagee or to such other address(es) as either Landlord or Tenant may
designate as its new address(es) for such purpose by notice given to the other
in accordance with the provisions of this Article 27.

            (B) Notices shall be deemed to have been rendered or given (a) on
the date delivered, if delivered by hand, or (b) three (3) Business Days after
mailing, if mailed as provided in Section 11.01(A). Notice given by counsel for
either party on behalf of such party or by the Manager or Managing Agent on
behalf of Landlord shall be deemed valid notices if addressed and sent in
accordance with the provisions of this Article. However, all default notices
shall be sent by either the Landlord or its attorney.

      Section 11.02 Notwithstanding the provisions of Section 11.01, Notices
requesting services for Overtime Periods pursuant to Section 16.04 may be given
by delivery to the Building superintendent or any other person in the Building
designated by Landlord to receive such Notices, and bills may be rendered by
delivering them to the Premises without the necessity of a receipt.

                                   ARTICLE 12

             Damage to and Defects in Building Equipment and Systems

            Section 12.01. Tenant shall give Landlord prompt notice of any
damage to, or defective condition in, any part or appurtenance of the Building's
plumbing, electrical, heating, air conditioning or other equipment or systems
serving, located in, or passing through the Premises of which Tenant is aware.
If such damage or defective condition was caused by, or resulted from the
improper use by, Tenant or by the employees, agents, licensees or invitees of
Tenant, all costs and expenses associated with the repair shall be paid by
Tenant. Tenant shall not be entitled to claim any damages arising from any such
damage or defective condition unless the same shall have been caused by the
intentional act or omission or the negligence of Landlord or its servants,
contractors, visitors, employees, agents, licensees or invitees in the operation
or maintenance of the Premises or the Building or the same shall not have been
repaired by Landlord with reasonable diligence after notice thereof from Tenant
to Landlord; nor shall Tenant be entitled to a claim of eviction ,real or
constructive by reason of any such damage or defective condition.

                                     - 15 -
<PAGE>

                                   ARTICLE 13

                                    Defaults

            Section 13.01. The following are Acts of Default under this lease :

                    (a) Tenant shall make an assignment of its property for the
benefit of creditors or shall file a voluntary petition under any bankruptcy or
insolvency law, or an involuntary petition under any bankruptcy or insolvency
law shall be filed against Tenant and such involuntary petition is not dismissed
within 60 days after the filing thereof,

                    (b) if a petition is filed by or against Tenant under the
reorganization provisions of the United States Bankruptcy Code (the "Bankruptcy
Code") or under the provisions of any law of like import, unless such petition
under said reorganization provisions be one filed against Tenant which is
dismissed within 120 days after its filing,

                    (c) if Tenant shall file a petition under the arrangement
provisions of the Bankruptcy Code or under the provisions of any law of like
import,

                    (d) if a permanent receiver, trustee or liquidator shall be
appointed for Tenant or of or for the property of Tenant, and such receiver,
trustee or liquidator shall not have been discharged within 160 days from the
date of his appointment,

                    (e) if Tenant shall default in payment of any Fixed Rent or
Additional Rent or any other charge payable hereunder by Tenant to Landlord on
any date upon which the same becomes due, and such default shall continue for
ten (10) days after the notice of such default.

                    (f) if Tenant shall default in the due keeping, observing or
performance of any covenant, agreement, term, provision or condition of Article
3 or Article 26 hereof on the part of Tenant to be kept, observed or performed
and such default shall continue and shall not be remedied by Tenant within ten
(10) business days after Landlord shall have given to Tenant a notice specifying
the same.

                    (g) if Tenant shall default in the keeping, observing or
performance of any covenant, agreement, term, provision or condition of this
lease on the part of Tenant to be kept, observed or performed (other than a
default of the character referred to in clauses (e) or (f) of this Section
1301), and if such default shall continue and shall not be remedied by Tenant
within twenty (20) days after Landlord shall have given to Tenant a notice
specifying the same, or, in the case of such a default which for causes beyond
Tenant's control cannot with due diligence be cured within said period of 20
days, if Tenant (i) shall not, promptly upon the giving of

                                     - 16 -
<PAGE>

such notice, notify Landlord of Tenant's intention to take all steps necessary
to remedy such default with due diligence, and (ii) shall not duly institute and
thereafter diligently prosecute to completion all steps necessary to remedy the
same.

                    (h) if any event shall occur or any contingency shall arise
(except as expressly permitted by this lease) whereby this lease or the estate
hereby granted or the unexpired balance of the term hereof would, by operation
of law or otherwise, devolve upon or pass to any firm, association, corporation,
person or entity other than Tenant (except as expressly permitted by this
lease).

                    In the event that any of The Acts of Default in Sections
13.01(a)-(h) occur, Tenant shall be in default of this lease. Landlord may give
to Tenant a notice of intention to end the term of this lease at the expiration
of 10 days from the date of the giving of such notice, and, in the event such
notice is given, this lease and the term and estate hereby granted shall expire
and terminate upon the expiration of said 10 days with the same effect as if
that day were the date hereinbefore set for the expiration of the full term of
this lease, but Tenant shall remain liable for damages as provided in this lease
or pursuant to law ("Default Termination"). If the term "Tenant", as used in
this lease, refers to more than one person, then as used in clauses (a), (b),
(c) and (d) of this Section 13.01, said term shall be deemed to include all of
such persons or any one of them; and, if this lease shall have been assigned,
the term "Tenant", as used in said clauses, shall be deemed to include the
assignee and the assignor or either of them under any such assignment unless
Landlord shall, in connection with such assignment, release the assignor from
any further liability under this lease, in which event the term "Tenant", as
used in said clauses, shall not include the assignor so released.

            Section 13.02. If Tenant shall default in the payment of any Fixed
Rent or Additional Rent or any other charge payable hereunder by Tenant to
Landlord on any date upon which the same becomes due and after all applicable
grace periods, or if this lease shall terminate as in Article 13 provided,
Landlord or Landlord's agents and servants may immediately or at any time
thereafter reenter into or upon the Premises, or any part thereof, either by
summary dispossess proceedings or by any suitable action or proceeding at law,
and may repossess the same, and may remove any persons therefrom, to the end
that Landlord may have, hold and enjoy the Premises again as and of its first
estate and interest therein. The words "reenter", "reentry" and "reentering" as
used in this lease are not restricted to their technical legal meanings.

            Section 13.03. In the event of any termination of this lease under
the provisions of Article 13 or in the event that Landlord shall reenter the
Premises under the provisions of this Article 13 or in the event of the
termination of this lease (or of reentry) by or under any summary dispossess or
other proceeding or action undertaken by Landlord for the enforcement of its
aforesaid right of reentry or any provision of law (any such termination of this
lease being hereinafter called a "Default Termination"), Tenant shall thereupon
pay to Landlord the Fixed Rent, Additional Rent and any other charge payable
hereunder by Tenant to Landlord up to the time of

                                     - 17 -
<PAGE>

such Default Termination or of such recovery of possession of the Premises by
Landlord, as the case may be, and shall additionally also pay to Landlord
damages as provided in Article 14 or pursuant to law. Also, in the event of a
Default Termination, Landlord shall be entitled to retain all monies, if any,
paid by Tenant to Landlord, whether as advance rent, security or otherwise, but
only to the extent such monies shall be credited by Landlord first against any
Fixed Rent, Additional Rent or any other charge due from Tenant at the time of
such Default Termination and then against any damages payable by Tenant under
Article 14 or pursuant to law, with the balance, if any, being paid to the
Tenant.

            Section 13.04. The specified remedies to which Landlord may resort
hereunder are cumulative and are not intended to be inclusive of any other
remedies or means of redress to which Landlord may lawfully be entitled at any
time, and Landlord may invoke any remedy allowed at law or in equity as if
specific remedies were not herein provided for.

                                   ARTICLE 14

                                     Damages

            Section 14.01. In the event of a Default Termination of this lease,
Tenant shall immediately pay to Landlord as damages:

                    (a) sums equal to the aggregate of the Fixed Rent and any
Additional Rent hereunder which would have been payable by Tenant had this lease
not terminated by such Default Termination, payable upon the due date therefor
specified herein following such Default Termination and until the date
hereinbefore set for the expiration of the full term hereby granted. If Landlord
shall relet all or any part of the Premises for all or any part of said period,
which Landlord is not obligated to do, Landlord shall credit Tenant with the net
rents received by Landlord from such reletting, such net rents to be determined
by first deducting from the gross rents as and when received by Landlord from
such reletting the reasonable expenses incurred or paid by Landlord in
terminating this lease and or reentering the Premises and of securing possession
thereof, as well as the reasonable expenses of reletting, including altering and
preparing the Premises for new tenants, brokers' commissions and all other
reasonable expenses chargeable against the Premises and the rental therefrom for
the stated term of this Lease in connection with such reletting, it being
understood that any such reletting may be for a period equal to or shorter or
longer than said period; provided, further that (i) in no event shall Tenant be
entitled to receive any excess of such net rents over the sums payable by Tenant
to Landlord hereunder, (ii) in no event shall Tenant be entitled, in any suit
for the collection of damages pursuant to this clause (a), to a credit in
respect of any net rents from a reletting except to the extent that such net
rents are actually received by Landlord, and (iii) if the Premises or any part
thereof should be relet in combination with other space, then appropriate
apportionment on a square foot rentable area basis shall be made of the rent
received from such reletting and of the reasonable expenses of reletting.

                                     - 18 -
<PAGE>

            Section 14.02. Nothing herein contained shall be construed as
limiting or precluding the recovery by Landlord against Tenant of any sums or
damages to which, in addition to the damages particularly provided above,
Landlord may lawfully be entitled by reason of any default hereunder on the part
of Tenant.

                                   ARTICLE 15

                                     Waivers

            Section 15.01. Tenant, for Tenant, and to the extent Tenant is able
on behalf of any and all firms, corporations, associations, persons or entities
claiming through or under Tenant, including creditors of all kinds, does hereby
waive and surrender all right and privilege which they or any of them might have
under or by reason of any present or future law to redeem the Premises or to
have a continuance of this lease for the full term hereby demised after Tenant
is dispossessed or ejected therefrom by process of law or under the terms of
this lease or after the expiration or termination of this lease as herein
provided or pursuant to law. If Landlord commences any summary proceeding,
Tenant agrees that Tenant will not interpose any counterclaim of whatever nature
or description in any such proceeding unless the same may not be brought in a
separate action by Tenant.

            Section 15.02. Except in the case of any action, proceeding or
counterclaim brought by either of the parties against the other for personal
injury or property damage, the respective parties hereto waive trial by jury in
any action, proceeding or counterclaim brought by either of the parties hereto
against the other on any matters whatsoever arising out of or in any way
connected with this lease, the relationship of Landlord and Tenant, Tenant's use
or occupancy of the Premises, and any emergency or any other statutory remedy.

                                   ARTICLE 16

                         Utilities and Building Services

            Section 16.01. Landlord will provide at Landlord's cost at least two
passenger elevators and one freight elevator from the Building lobby to the
Premises during Business Hours, and at least one elevator from the Building
lobby to the Premises at all times set forth in the first sentence of Section
16.07. Heat, for the warming of the Premises and the public portions of the
Building, will be supplied by Landlord during Business Hours in accordance with
REBNY standards. "Business Hours", as used in this lease, means between 8:00
A.M. until 5:30 P.M on days other than Saturdays, Sundays and holidays.
"Holidays" as used in this lease means all

                                     - 19 -
<PAGE>

days observed by the State or federal government as legal holidays (New Year's
Day, Martin Luther King's Birthday, Lincoln's Birthday, President's Day,
Memorial Day, Independence Day, Labor Day, Columbus Day, Veteran's Day,
Thanksgiving Day, and Christmas). Business days shall mean all days other than
Saturdays, Sundays and Holidays. Upon the request of Tenant, Landlord will
advise Tenant of the projected schedule of Legal Holidays, as defined herein, to
be observed in the Building, for such period of time following Tenant's requests
as such observances are firm.

            Section 16.02. Landlord shall, pursuant to standard office building
cleaning contracts in force from time to time, cause the Premises to be kept
clean and cause refuse and rubbish to be removed from the Premises at Tenant's
cost and expense. If Landlord shall change the cleaning service to a new
company, it shall use due diligence when contracting with such company and shall
require the new company to provide background screening for cleaning personnel.

            Section 16.03. Landlord shall provide at Landlord's cost air
conditioning to the Premises from May 15th of each year through and including
September 30th of each year during Business Hours (the "Cooling Season").
Landlord shall maintain all air conditioning equipment and systems. Landlord
shall have the air conditioning equipment and systems in good working order at
Landlord's expense, within Premises "on" and operational during Business Hours,
as that term is defined in Section 16.01 of this lease.

            Section 16.04. Landlord will, when and to the extent reasonably
requested by Tenant, furnish additional elevator, heating and air conditioning
additional, upon such terms and conditions as shall be reasonably determined by
Landlord; and Tenant shall pay to Landlord promptly on demand as Additional Rent
Landlord's charges for such additional services. Without limiting the generality
of the preceding sentence, Tenant shall pay to Landlord Landlord's actual cost
for (i) all cleaning of the Building or any part thereof required because of the
carelessness or indifference of Tenant, (ii) the removal of any of Tenant's
refuse and rubbish from the Building.

            Section 16.05. At any time or times all or any of the elevators in
the Building may, at the option of Landlord, be manual and/or automatic
elevators, and Landlord shall be under no obligation to furnish an elevator
operator for any automatic elevator. If Landlord shall at any time or times
furnish any elevator operator for any automatic elevator, Landlord may
discontinue furnishing such elevator operator without any diminution, reduction
or abatement of rent. If Landlord switches from automatic to manual elevators,
Landlord shall provide, at no cost to Tenant, at least one elevator operator for
each manual elevator during Business Hours as defined in Section 16.01 of this
lease.

            Section 16.06. Landlord reserves the right, without liability to
Tenant and without constituting any claim of constructive eviction, to stop or
interrupt any heating, elevator, escalator, lighting, ventilating, air
conditioning, gas, steam, power, electricity, water, cleaning or other service
and to stop or interrupt the use of any Building facilities at such times as may
be reasonably necessary and for as long as may reasonably be required by reason
of accidents, strikes,

                                     - 20 -
<PAGE>

or the making of repairs, alterations or improvements, or inability to secure a
proper supply of fuel, gas, steam, water, electricity, labor or supplies, or by
reason of any other similar cause beyond the reasonable control of Landlord.
Landlord agrees to use reasonable diligence to restore any stopped or
interrupted services or Building facilities.

            Section 16.07. Tenant shall have access to the Premises twenty-four
(24) hours a day, seven (7) days a week.

                                   ARTICLE 17

                       Lease Contains All Agreements; Etc.

            Section 17.01. This lease contains all of the covenants, agreements,
terms, provisions and conditions relating to the leasing of the Premises
hereunder, and neither Landlord nor Tenant, in executing and delivering this
lease is relying upon, any warranties, representations, promises or statements,
except to the extent that the same may expressly be set forth in this lease.

            Section 17.02. The failure of Landlord or Tenant to insist in any
instance upon the strict performance of any provision of this lease or to
exercise any election herein contained shall not be construed as a waiver or
relinquishment for the future of such provision or election, but the same shall
continue and remain in full force and effect. No waiver or modification by
Landlord or Tenant of any provision of this lease or other right or benefit
shall be deemed to have been made unless expressed in writing and signed by
Landlord or Tenant, as the case may be. No surrender of the Premises or of any
part thereof or of any remainder of the term of this lease shall be valid unless
accepted by Landlord in writing. Any breach by Tenant of any provision of this
lease shall not be deemed to be waived by (a) the receipt and retention by
Landlord of Fixed Rent or Additional Rent from anyone other than Tenant or (b)
the acceptance of such other person as a tenant or (c) a release of Tenant from
the further performance by Tenant of the provisions of this lease or (d) the
receipt and retention by Landlord of Fixed Rent or Additional Rent with
knowledge of the breach of any provision of this lease. No payment by Tenant or
receipt or retention by Landlord of a lesser amount than any Fixed Rent or
Additional Rent herein stipulated shall be deemed to be other than on account of
the earliest stipulated rent, nor shall any endorsement or statement of any
check or any letter accompanying any check or payment of such 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 rent or pursue any
other remedy in this lease provided. No agreement hereafter made between
Landlord and Tenant shall be effective to change, modify, waive, release,
discharge, terminate or effect an abandonment of this lease, in whole or in
part, unless such agreement is in writing, refers expressly to this lease and is
signed by the party against whom enforcement of the change, modification,
waiver, release, discharge or termination or effectuation of the abandonment is
sought.

                                     - 21 -
<PAGE>

                                   ARTICLE 18

                                  Parties Bound

            Section 18.01. The covenants, agreements, terms, provisions and
conditions of this lease shall bind and benefit the respective successors,
assigns and legal representatives of the parties hereto with the same effect as
if mentioned in each instance where a party hereto is named or referred to,
except that no violation of the provisions of Article 22 hereof shall operate to
vest any rights in any successor, assignee or legal representative of Tenant and
that the provisions of this Article 18 shall not be construed as modifying the
conditions of limitation contained in Article 12 hereof. It is understood and
agreed, however, that the covenants and obligations on the part of Landlord
under this lease shall not be binding upon Landlord herein named accruing with
respect to any period subsequent to the transfer of its interest in the Building
provided however, that in the event of such a transfer said covenants and
obligations shall thereafter be binding upon each transferee of such interest of
Landlord herein named, but only with respect to the period ending with a
subsequent transfer of such interest, and that a lease of the entire interest
shall be deemed a transfer within the meaning of this Article 18.

                                   ARTICLE 19

                   Curing Tenant's Defaults -- Additional Rent

            Section 19.01. If Tenant shall be in default beyond an applicable
grace period in the keeping, observance or performance of any provision or
obligation of this lease, Landlord, without thereby waiving such default, may
perform the same for the account and at the expense of Tenant, without notice.
Bills for any expense incurred by Landlord in connection with any such
performance by Landlord for the account of Tenant, and bills for all costs,
expenses and disbursements of every kind and nature whatsoever, including, but
not limited to, reasonable attorneys' fees, involved in collecting or
endeavoring to collect the Fixed Rent or Additional Rent or other charge or any
part thereof or enforcing or endeavoring to enforce any rights against Tenant,
under or in connection with this lease, or pursuant to law, including (without
being limited to) any such reasonable cost, expense and disbursement involved in
instituting and prosecuting any action or proceeding (including any summary
dispossess proceeding), as well as reasonable bills for any property, material,
labor or services provided, furnished or rendered, or caused to be provided,
furnished or rendered, by Landlord to Tenant including (without being limited
to) electric lamps and other equipment, construction work done for the account
of Tenant, water and other services, as well as for any charges for any
additional elevator, heating, air conditioning or cleaning services incurred
under Article 16 hereof and any charges for other similar or dissimilar services
incurred under this

                                     - 22 -
<PAGE>

lease, may be sent by Landlord to Tenant monthly, or immediately, at Landlord's
option, and shall be due and payable in accordance with the terms of said bills
within thirty (30) days after receipt, and if not paid when due, the amounts
thereof shall immediately become due and payable as Additional Rent under this
lease. Tenant shall not be obligated to pay any legal fees or expenses of any
kind incurred by Landlord in connection with Landlord's assertion against Tenant
of claims that have no merit and are unsuccessfully asserted. Tenant also shall
not be obligated to pay any expenses of any kind for services which Landlord is
obligated to provide to Tenant pursuant to the terms of this lease or applicable
law, unless this lease expressly obligates Tenant to pay such expenses pursuant
to a provision of this lease other than this Section 19.01. If any Fixed Rent,
Additional Rent or any other costs, expenses or disbursements payable under this
lease including all money owed under Section 1.04 by Tenant to Landlord are not
paid within thirty (30) days after their respective due dates, the same shall
bear interest, from the respective due dates, at the rate of three (3%) percent
per month or the maximum rate permitted by law, whichever is less, until paid
and the amount of such interest shall be Additional Rent. If Tenant prevails in
a legal action against Landlord, then pursuant this Lease Landlord shall
reimburse Tenant for all reasonable legal costs.

            Section 19.02. In the event that Tenant is in default in payment of
Fixed Rent or Additional Rent or any other charge, Tenant waives Tenant's right,
if any, to designate the items against which any payments made by Tenant are to
be credited, and Tenant agrees that Landlord may apply any payments made by
Tenant to any items Landlord sees fit, irrespective of and notwithstanding any
designation or request by Tenant as to the items against which any such payments
shall be credited.

                                   ARTICLE 20

                              Inability to Perform

            Section 20.01. This lease and the obligations of Tenant to pay rent
hereunder and perform all of the other covenants, agreements, terms, provisions
and conditions hereunder on the part of Tenant to be performed shall in no way
be affected, impaired or excused because Landlord is unable to fulfill any of
its obligations under this lease or because Landlord is unable to supply or is
delayed in supplying any service expressly or impliedly to be supplied or is
unable to make or is delayed in making any repairs, replacements, additions,
alterations or decorations or is unable to supply or is delayed in supplying any
equipment or fixtures if Landlord is prevented or delayed from s doing by reason
of strikes or labor troubles or any other cause beyond Landlord's control,
including, but not limited to, governmental preemption in connection with a
national emergency or by reason of any rule, order or regulation of any
department or subdivision thereof of any governmental agency or by reason of the
conditions of supply and demand which have been or are affected by war,
hostilities or other similar emergency, except as otherwise expressly provided
in the Lease.

                                     - 23 -
<PAGE>

                                   ARTICLE 21

                              Water and Electricity

            Section 21.01. Landlord shall in no way be liable or responsible to
Tenant for any loss or damage or expense which Tenant  may sustain
or incur by reason of any failure, inadequacy or defect in the character,
quantity or supply of electricity or water furnished to the Premises, except if
any such failure, inadequacy or defect is the result of any negligent or willful
act or omission of Landlord or its agents, employees, servants, licensees, or
contractors.

            Section 21.02. Landlord shall furnish hot and cold water for (a)
normal office use and in connection with the performance by Tenant of any
Tenant's Changes in accordance with clause (e) of Section 5.01, (b) Landlord's
air conditioning equipment during Business Hours, and (c) drinking, lavatory,
kitchen and toilet facilities, in or near the Premises and Tenant's Separate Air
Conditioning Unit. When water is furnished by Landlord for any other purpose,
Tenant shall pay a reasonable amount for the same and for any required pumping
and heating thereof as well as any taxes, sewer rents or other charges which may
be imposed on any governmental authority or agency thereof based on the quantity
of water so used by Tenant.

            Section 21.03. Subject to the provisions of Section 21.05,
electricity shall be furnished to Tenant through the electrical lines and
service presently servicing the Building, and Tenant shall purchase same from
Landlord, on the basis provided in Section 21.04.

            Section 21.04 Tenant shall pay Landlord a fixed monthly consumption
charge, commencing, at such time as rent commences pursuant to Section 1.10 of
this Lease, for all electricity consumed in the Premises. Such charge shall
initially be $3,000.00 per month (based on a $3.00 per square foot charge) (the
"Base Electrical Charge") and shall be increased from time to time on the basis
of either an increase in the total usage of electricity by Tenant or an increase
in the rates, charges and fees paid by Landlord for electrical service, above
Landlord's electrical rates charged to Landlord in 2005. Such increase will only
occur after Landlord has conducted a survey of Tenant's electrical usage and
given Tenant the opportunity to survey his own usage. In each case the Survey
shall be done by people qualified in the field; if the parties' respective
surveyors cannot agree then both surveyors will select a third surveyor whose
opinion shall be dispositive.

            Section 21.05. Landlord shall not be liable to Tenant for any loss,
damage or expense which Tenant may sustain or incur if either the quantity or
character of electric service is changed or is no longer available or suitable
for Tenant's requirements. Tenant agrees that its use of electric current shall
never exceed the capacity of existing feeders to the Building or the risers or
existing wiring installation in the Building. Tenant agrees not to connect any
additional electrical equipment to the Building electric distribution system,
other than lamps, typewriters, photocopiers, telephones, telexes, telecopier
equipment, desk-top non-mainframe computers, kitchen electrical

                                     - 24 -
<PAGE>

appliances, word processors, printers, postage machines and all equipment
ancillary thereto and other small office machines which consume comparable
amounts of electricity, without Landlord's prior written consent which consent
shall not be withheld or delayed unreasonably. Any riser or risers to supply
Tenant's electrical requirements, upon written request of Tenant, will be
installed by Landlord at the sole reasonable cost and expense of Tenant if, in
Landlord's reasonable judgment, the same are necessary and will not cause
permanent damage or injury to the Building or the Premises or cause or create a
dangerous or hazardous condition or entail excessive or unreasonable
alterations, repairs or expense or interfere with or disturb other tenants or
occupants. Landlord reserves the right to terminate the furnishing of
electricity on the basis provided in this Article 21 at any time, upon 90 days'
notice to Tenant, in which event Tenant shall make application directly to the
public utility for its own completely separate supply of electric current and
Landlord shall permit its wires, feeders, conduits and risers, to the extent
available and safely capable, to be used for such purpose. Any meters, risers,
feeders or other equipment or connections necessary to enable Tenant to obtain
electric current directly from such utility shall be installed at Landlord's
sole cost and expense; provided, however, and anything hereinbefore contained to
the contrary notwithstanding, Landlord shall not terminate the furnishing of
electricity as aforesaid following the expiration of such 90 day period, and
thereafter, for so long as Tenant does not have its own separable electric
service, so long as Tenant is diligently pursuing the aforesaid application and
the installation of its separate electric service. Rigid conduit only will be
allowed. This lease shall otherwise remain in full force and effect at the time
Landlord terminates the furnishing of electricity as aforesaid. Commencing when
Tenant receives such direct service and as long as Tenant shall continue to
receive such service, Landlord shall no longer be entitled to charge or receive
the fixed monthly consumption charge referred to in Section 21.04 and any
payment made by Tenant for periods after Tenants' receipt of direct service
shall be promptly refunded.

                                   ARTICLE 22

                          Assignment, Subletting, Etc.

            Section 22.01. Tenant other than pursuant to the provisions of this
lease, shall not, whether voluntarily, involuntarily, by operation of law or
otherwise (a) assign or otherwise transfer this lease or the term and estate
hereby granted, (b) sublet the Premises or any part thereof, or allow the same
to be used, occupied or utilized by any one other than Tenant, or (c) mortgage,
pledge, encumber or otherwise hypothecate this lease or the Premises or any part
thereof in any manner whatsoever, without in each instance obtaining the prior
consent of Landlord which consent as to (a) and (b) above which may be withheld
conditioned or delayed. The consent by Landlord to an assignment, subletting or
use or occupancy by others shall not in any way be considered to relieve Tenant
from obtaining the express consent of Landlord to any other or further
assignment, or subletting or use or occupancy by others not expressly permitted
by this Article.

                                     - 25 -
<PAGE>

            Section 22.02. If this lease be assigned in violation of the
provisions of the lease or, in the event the assignor is released from all
liability pursuant to the lease, Landlord may collect rent due to the Landlord
from the assignee. If the Premises or any part hereof are sublet or used or
occupied by anybody other than Tenant, whether or not in violation of this
lease, Landlord may, after default by Tenant, and expiration of Tenant's time to
cure such default, collect rent from the subtenant or occupant. In either event,
Landlord may apply the net amount collected to the Fixed Rent and Additional
Rent herein reserved and the charges herein provided for, but no such
assignment, subletting, occupancy or collection shall be deemed a waiver of any
of the provisions of Section 22.01, or the acceptance of the assignee, subtenant
or occupant as tenant, or a release of Tenant from the performance by Tenant of
Tenant's obligations under this lease. References in this lease to use or
occupancy by other than Tenant shall not be construed as limited to subtenants
and those claiming under or through subtenants but as including also licensees
and other claiming under or through Tenant, immediately or remotely.

            Section 22.03. The use of any portion of the Tenant's facilities by
a subsidiary of the Tenant or an entity controlled by the Tenant shall not be
regarded as a subletting under this lease.

            Section 22.04. The placement of or any person or entity name whether
on the doors of the Premises, on the Building directory, or otherwise, shall not
operate to vest any right or interest in this lease or in the Premises or be
deemed to be the written consent of Landlord mentioned in this Article 22.

            Section 22.05. Anything contained in this Lease to the contrary
notwithstanding, if Tenant as a debtor in possession under the Bankruptcy Code
or Tenant's trustee under the Bankruptcy Code contemplates an assignment of this
lease pursuant to the Bankruptcy Code to any person, firm or corporation which
shall have made a bona fide offer to accept such an assignment on terms and
conditions which are acceptable to such debtor in possession or trustee, then
notice of such proposed assignment shall be given to Landlord at least 15 days
prior to the date that an application to a court of competent jurisdiction for
approval of and authority to enter into such proposed assignment is
contemplated. Such notice shall set forth the name and address of the proposed
assignee, all of the terms and conditions of the proposed assignment, including
any consideration therefor, and the nature of the adequate assurance to be
provided Landlord to assure the future performance under this lease of such
proposed assignee. Landlord may thereupon elect, by notice to Tenant given at
any time prior to the later of the date upon which the aforesaid application for
approval and authority is contemplated or the effective date of the proposed
assignment, to accept, for itself or on behalf of a nominee, an assignment of
this lease upon the same terms and conditions as are contemplated by the
aforesaid offer (less any brokerage commissions which would be payable in
connection with such proposed assignment). If Landlord does not so elect to
accept such an assignment, then (a) upon the effective date of the proposed
assignment, the proposed assignee shall be deemed to have assumed all of the
obligations of Tenant arising hereunder from and after such effective date,
without further action on the part of such proposed assignee (but such proposed
assignee shall nevertheless at Landlord's request, execute and deliver, at

                                     - 26 -
<PAGE>

its own cost and expense, to Landlord such an instrument confirming such
assumption as Landlord may reasonably require), and (b) any consideration
payable or otherwise to be delivered in connection with such proposed assignment
shall be paid or delivered to Landlord, shall be and remain the exclusive
property of Landlord and shall not constitute property or Tenant of Tenant's
bankruptcy estate.

                                   ARTICLE 23

                                   Escalation

            Section 23.01. As used in this Article 23, the words and terms which
follow mean and include the following:

               (a) "Tax Year" shall mean each fiscal year, (July 1 through the
succeeding June 30) subsequent to the fiscal year 2005/2006 in which occurs any
part of the term of this lease.

               (b) Base Year shall mean the fiscal year 2005/2006

               (c) "Tenant's Proportionate Share" shall mean three (3%) percent.

               (d) "Taxes" shall mean the aggregate amount of real estate taxes
and any general or special assessments (exclusive of penalties and interest
thereon) imposed upon the Real Property (including, without limitation, (i)
assessments made upon or with respect to any "air" and "development" rights now
or hereafter appurtenant to or affecting the Real Property, (ii) any fee, tax or
charge imposed by any Government Authority for any vaults, vault safe or other
space within or outside the boundaries of the Real Property, and (iii) any
assessments levied after the date of this Lease for public benefits to the Real
Property or the Building); provided that if, because of any change in the
taxation of real estate, any other tax or assessment, however denominated
(including, without limitation, any franchise, income, profit, sales, use,
occupancy, gross receipts or rental tax) is imposed upon Landlord or the owner
of the Real Property of the Building, or the occupancy, rents or income
therefrom, in substitution for any of the foregoing Taxes or for an increase in
any of the foregoing Taxes, such other tax or assessment shall be deemed part of
Taxes computed as if Landlord's sole asset were the Real Property. Anything
contained herein to the contrary notwithstanding, Taxes shall not be deemed to
include (a) any taxes on Landlord's income, (b) franchise taxes, (c) estate or
inheritance taxes, or (d) any similar taxes imposed on Landlord, unless such
taxes are levied, assessed or imposed as a substitute for the whole or any part
of, or as a substitute for an increase, the taxes, assessments, levies, fees,
charges and impositions that now constitute Taxes.

                                     - 27 -
<PAGE>

               (e) "Real Estate Tax Base" shall mean Real Estate Taxes for the
City of New York for the fiscal year June 1, 2005 - June 30, 2006.

               (f) Operating Year shall mean each calendar year, subsequent to
calendar year 2006, in which occurs any part of the term of the Lease.

               (g) (A) "Operating Expenses" shall mean the aggregate of those
costs and expenses (and taxes thereon, if any) paid or incurred by Landlord or
on behalf of Landlord with respect to the operation, cleaning, repair, safety,
replacement, management, security and maintenance of the Real Property, Building
Systems, sidewalks, curbs, plaza, and other areas adjacent to Building, and with
respect to the services provided to tenants, including, without limitation: (i)
salaries, wages and bonuses paid to, and the cost of any hospitalization,
medical, surgical, union and general welfare benefits (including group life
insurance), any pension, retirement or life insurance plans and other benefits
or similar expenses relating to employees of Landlord below the level of
building manager engaged at the building in the operation, cleaning, repair,
safety, replacement, management, security or maintenance of the Real Property
and the Building Systems or in providing services to tenants; (ii) social
security, unemployment and other payroll taxes, the cost of providing disability
and worker's compensation coverage imposed by any Requirement, union contract or
otherwise with respect to said employees; (iii) the cost of gas, oil, steam,
water, sewer rental, HVAC and other utilities furnished to the Building and
utility taxes; (iv) the expenses incurred for casualty, rent, liability,
fidelity, plate glass and other insurance; (v) expenditures, whether by purchase
or lease, for capital improvements and capital equipment that under generally
applied real estate practice are expensed or regarded as deferred expenses and
capital expenditures, whether by purchase or lease, that are made by reason of
Requirements or for emergency or labor-saving devices or security or property
protection systems or in lieu of a repair, in each case such capital
expenditures to be included in Operating Expenses for the Operating Year in
which such costs are incurred and every subsequent Operating Year, on a straight
-line basis, to the extent that such items are amortized over its longest useful
life under GAAP with interest calculated at an annual rate equal to three (3%)
percent over the Base Rate in effect at the time of Landlord's having made said
expenditure; (vii) the cost or rental of all supplies, tools, materials and
equipment used exclusively at the Building; (viii) the cost of uniforms, work
clothes and dry cleaning; (ix) the cost of window cleaning, janitorial,
concierge, guard, watchman or other security personnel, service or system, if
any; (x) management fees not in excess of those customarily charged by
management companies operating similar space; (xi) charges of independent
contractors performing work included within this definition of Operating
Expenses; (xii) telephone and stationary costs at the Building; (xiii) legal,
accounting and other professional fees and disbursements incurred in connection
with the operation and management of the Real Property; (xiv) association fees
and dues; (xv) the cost of decorations; (xvi) depreciation of hand tools and
other movable equipment used in the operation, cleaning. Repair, safety,
security or maintenance of the Building; (xvii)15% - of all electrical costs
incurred in the operation of the Real Property.

                                     - 28 -
<PAGE>

            Provided, however, that operating expenses shall not include the
foregoing costs and expenses which shall be excluded or have been deducted from
them, as the case may be:

      (1)   salaries benefits, wages, bonuses and other compensation to person
            at or above the grade building manager;
      (2)   amounts received by Landlord through proceeds of insurance to the
            extent they are compensation of sums previously included in
            Operating Expenses;
      (3)   cost of repairs or replacement incurred by reason of fire or other
            casualty or condemnation to the extent Landlord is compensated
            therefor; which may include application of any proceeds to reduction
            of any mortgage debts;
      (4)   costs incurred in performing work or furnishing services or
            utilities for any tenant, whether at such tenant's or Landlord's
            expense,
      (5)   Taxes;
      (6)   refinancing costs, mortgage interest, amortization payments,
            reserves and other charges due under any mortgage;
      (7)   leasing commissions, rental concessions, Tenant build-outs,
            Landlord's work and lease buy-outs;
      (8)   any expense for which Landlord is entitled to be reimbursed by any
            tenant as an additional charge in excess of Fixed Rent and
            Escalation Rent;
      (9)   depreciation;
      (10)  overhead and profit increment paid to affiliates of Landlord for
            services to the extent that such costs exceed the costs of such
            services were they rendered by an affiliate;
      (11)  rental under any ground or underlying lease;
      (12)  professional fees not attributable to the operation or management of
            the Real Property and professional fees attributable to disputes
            with, or preparation of leases for, tenants and prospective tenants;
      (13)  advertising and promotional expenses with respect to the Property;
            and
      (14)  85% of all electrical costs incurred in the operation of the Real
            Property.
      (15)  costs incurred in connection with a transfer or disposition of the
            Real Property or Building

            If the Landlord purchases any item of capital equipment or makes any
capital expenditure that is intended to have the effect of reducing the expenses
that would otherwise be included in Operating Expenses, then the costs of such
capital equipment or capital expenditure shall be included in Operating Expenses
for the Operating Year in which the costs are incurred and every subsequent
Operating Year on a straight-line basis, to the extent that such items are
amortized over an appropriate period, with interest calculated, at an annual
rate of three (3%) percent over the Base Rate in effect at the time of
Landlord's having made said expenditure. If Landlord leases any item of capital
equipment that results in savings or reductions in expenses that would otherwise
be included in Operating Expenses, then the rentals and other costs paid with
respect to such leasing shall be included in Operating Expenses for the
Operating Years in which such rentals and costs are incurred.

    If Landlord is not furnishing any particular work or service (the cost of
which if performed

                                     - 29 -
<PAGE>

by Landlord would constitute an Operating Expense) to a tenant who has
undertaken to perform such work or service in lieu of the performance thereof by
Landlord for all or any portion of an Operating Year, Operating Expenses for
such Operating Year shall be deemed to be increased by an amount equal to the
additional Operating Expenses which reasonably would have been incurred during
such Operating Year by Landlord if it had, at its own expense, furnished such
work or service to such tenant, less if Tenant shall be the tenant to whom
Landlord is not furnishing any such work or service, the actual reduction, if
any, in the amount payable to the contractor or supplier providing such work or
service to the Building by reason of the non-provision thereof to Tenant.

               (A) Tenant shall pay as Escalation Rent for each Operating Year
an amount ("Tenant's Operating Payment") equal to Tenant's Share of the amount
by which Operating Expenses for such Operating Year are greater than the Base
Operating Factor.

               (B) Landlord shall furnish to Tenant, with respect to each
Operating Year, a Landlord's Operating Statement setting forth Landlord's
estimate of Tenant's Operating Payment for such Operating Year ("Tenant's
Protected Operating Share"). Tenant shall pay to Landlord on the first day of
each month during such Operating Year, as Escalation Rent, an amount equal to
one-twelfth of Tenant's Projected Operating Share for such Operating Year. If,
however, Landlord furnishes any such Landlord's Operating Statement for an
Operating Year subsequent to the commencement of such Operating Year, then (a)
until the first day of the month following the month in which such Landlord's
Operating Statement is furnished to Tenant, Tenant shall pay to Landlord on the
first day of each month an amount equal to the monthly sum payable by Tenant to
landlord under Section 3.3 in respect of the last month of the preceding
Operating Year; (b) after such Landlord's Operating Statement is furnished to
Tenant or together therewith, Landlord shall give notice to Tenant stating
whether the installments of Tenant's Projected Operating Share previously made
for such Operating Year were greater or less than the installments of Tenant's
Projected Operating Share to be made for such Operating Year in accordance with
such estimate, and (i) if there is a deficiency, Tenant shall pay the amount
thereof within thirty (30) days after demand thereof, or (ii) if there was an
overpayment, Landlord shall credit the amount thereof against subsequent
payments of Rental or, if at the end of the Term there shall not be any further
installments of Rental remaining against which Landlord can credit any such
overpayment due Tenant, Landlord shall deliver to Tenant Landlord's check in the
amount of the refund due Tenant within thirty (30) days after Tenant shall first
be entitled to a credit for the overpayment of Operating Expenses; and (c) on
the first day of the month following the month in which such Landlord's
Operating Statement is furnished to Tenant, and monthly thereafter throughout
the remainder of such Operating Year, Tenant shall pay to Landlord an amount
equal to one-twelfth of Tenant's Projected Operating Share shown in such
Landlord's Operating Statement with a new estimate of Tenant's Projected
Operating Share for such shall be adjusted and paid or credited, as the case may
be, substantially, in the same manner as provided in the preceding sentence.

                                     - 30 -
<PAGE>

               (C) After the end of each Operating Year, Landlord shall furnish
to Tenant a Landlord's Operating Statement for such Operating Year. Each such
year-end Landlord's Operating Statement shall be accompanied by a computation of
Operating Expenses for the Building prepared by the Manager or a certified
public accountant designated by Landlord from which Landlord shall make the
computation of Additional Rent due in respect of Operating Expenses hereunder.
In making computations of Operating Expenses, the certified public accountant or
the Manager may rely on Landlord's reasonable estimates and allocations whenever
said estimates and allocations are needed for this Article 3. If the Landlord's
Operating Statement shows that the sums paid by Tenant under Section 3.3(B)
exceeded Tenant's Operating Payments required to be paid by Tenant for such
Operating Year, Landlord shall credit the amount of such excess against
subsequent payments of Rental or, if at the end of the Term there shall not be
any further installments of Rental remaining against which Landlord can credit
such overpayments due Tenant, Landlord shall deliver to Tenant Landlord's check
in the amount of the refund due Tenant within thirty (30) days after Tenant
shall be entitled to a credit for the overpayment of Operating Year shows that
the sums so paid by Tenant were less than Tenant's Operating Payment due for
such Operating Year, Tenant shall pay the amount of such deficiency within
thirty (30) days after demand therefor.

               (h) The term "Escalation Statement" shall mean a statement
setting forth the amount payable by Tenant for a specified Tax Year of Operating
Year (as the case may be) pursuant to this Article 36.

            Section 23.02. If the Real Estate Taxes for any Tax Year shall be
greater than the Real Estate Tax Base, Tenant shall pay Landlord, as Additional
Rent for the Premises for such Tax Year, an amount (herein called the "Tax
Payment") equal to Tenant's Proportionate Share of the amount by which Real
Estate Taxes for such Tax Year are greater than the Real Estate Tax Base.

            Section 23.03. Landlord shall furnish Tenant, at the commencement of
each Tax Year and Operation Year, as the case may be, a written statement of the
actual tax payment, pursuant to Section 23.02 hereof, and the Annual Escalation
Statement, pursuant to Section 23.01(g) hereof. Tenant shall pay to Landlord on
the first day of each month during such Tax Year and such Operation Year an
amount equal to one-twelfth of the Tax Payment for such Tax Year and one-twelfth
of the Annual Operation Escalation for such Operation Year. If, however,
Landlord shall furnish any such statement for an Operation Year or a Tax Year
subsequent to the commencement thereof, then (a) until the first day of the
month following the month in which such statement is furnished to Tenant, Tenant
shall pay to Landlord on the first day of each month an amount equal to the
monthly sum payable by Tenant to Landlord under this Section in respect of the
last month of the preceding Operation Year or Tax Year; (b) promptly after such
statement is furnished to Tenant, Landlord shall give notice to Tenant stating
whether the installments of the Tax Payment or the Annual Escalation previously
made for such Tax Year or Operating Year, as the case may be, were greater or
less than the respective installments thereof to be made for such Operating Year
or Tax Year in accordance with such statement, and (i) if there shall be a
deficiency, Tenant shall pay the amount thereof within thirty (30) days after
demand therefor, or (ii) if there shall have been an

                                     - 31 -
<PAGE>

overpayment, Landlord shall refund to Tenant the amount thereof within thirty
(30) days of Landlord's furnishing to Tenant such statement; and (c) on the
first day of the month following the month in which such statement is furnished
to Tenant, and monthly thereafter throughout the remainder of such Operation
Year or Tax Year, as the case may be, Tenant shall pay to Landlord an amount
equal to one-twelfth of the Tax Payment or one-twelfth of the Annual Operation
Escalation, as the case may be, shown on such statement. Landlord shall furnish
to Tenant within 30 days of the commencement of each Operative Year and each Tax
Year a copy of the bill or bills for Real Estate Taxes applicable to the Tax
Year as to which each such Statement relates.

            Section 23.04. Payments shall be made pursuant to this Article 23
notwithstanding the fact that an Escalation Statement is furnished to Tenant
after the expiration of the term of this lease, provided the Escalation
Statement is furnished within one year thereafter.

            Section 23.06 In case the Real Estate Taxes for any Tax Year or part
thereof shall be reduced after Tenant shall have paid Tenant's Proportionate
Share of any increase thereof in respect of such Tax Year, Landlord shall credit
or refund to Tenant Tenant's Proportionate Share of the refund of such taxes
received by or credited to Landlord (after deduction of reasonable expenses,
including reasonable counsel fees, incurred by Landlord in connection with
reducing the assessed valuation and/or in obtaining such refund of taxes). Only
Landlord and not Tenant shall have the right to initiate, contest or resolve
proceedings involving the assessed valuation or refund of taxes.

            Section 23.07. In no event shall the Fixed Rent under this Lease
(exclusive of the Additional Rent under this Article) be reduced by virtue of
this Article.

                                   ARTICLE 24

                                  Subordination

            Section 24.01. This lease is and shall be subject and subordinate in
all respects to all underlying leases now or hereafter covering the real
property or any portion thereof of which the Premises form a part and to all
mortgages and trust indentures which may now or hereafter be placed on or affect
such leases and/or the real property of which the Premises form a part, or any
part or parts of such real property, and/or Landlord's interest therein, and to
each advance made and/or hereafter to be made under any such mortgages, or
indentures, and to all renewals, modifications, consolidations, replacements and
extensions thereof and all substitutions of and for such ground leases and/or
underlying leases and/or mortgages or indentures. This Section 24.01 shall be
self-operative and no further instrument of subordination shall be required. In
confirmation of such subordination, Tenant shall execute, at its sole cost and
expense, and deliver promptly any estoppel certificate or other document that
Landlord and/or any mortgagee and/or lessor under any ground or underlying lease
and/or their respective successors in interest may reasonably request. Tenant
agrees that, in the event any proceedings are brought for the foreclosure of any
mortgage or indenture referred to herein, to attorn to the purchaser upon any
such foreclosure sale and to recognize such purchaser as the landlord under this
lease. In the event of the

                                     - 32 -
<PAGE>

enforcement by any mortgagee of the Building of remedies provided for by law or
by such mortgage, any person succeeding to the interest of the Landlord as the
result of such enforcement shall not be bound by any payment of Fixed Rent or
Additional Rent for more than one month in advance not received by it.

                                   ARTICLE 25

                                 Quiet Enjoyment

            Section 25.01. Landlord covenants that if and so long as Tenant
keeps and performs each and every covenant, agreement, term, provision and
condition herein contained on the part and on behalf of Tenant to be kept and
performed, Tenant shall quietly enjoy the Premises without hindrance or
molestation by Landlord or by any other person claiming the same, subject to the
covenants, agreements, terms, provisions and conditions of this lease and to the
mortgages to which this lease is subject and subordinate, as hereinbefore set
forth.

                                   ARTICLE 26

                                    Insurance

            Section 26.01. Tenant covenants to provide prior to entry upon the
Premises and to keep in force and effect during the demised term: (1)
comprehensive general liability insurance relating to the Premises and its
appurtenances on an occurrence basis against claims for bodily injury or death
on account of accident upon the Premises with minimum limits of liability in
amount of $1,000,000.00 per occurrence; and $2,000,000.00 in the aggregate and
(2) workmen's compensation insurance to cover all persons engaged in Tenant's
Changes. Tenant agrees to deliver to Landlord, for all current insurance
policies a Certificate of Insurance in compliance with its obligations
hereunder.

            Section 26.02. All of the aforesaid insurance shall be issued in the
name of Tenant and shall name Landlord (and any designee(s) of Landlord, with an
insurable interest in the Building) as an additional insured and shall be
written by responsible insurance companies licensed to do business in New York
State; all such insurance may be carried under a blanket policy covering the
Premises and any other of Tenant's locations and shall, by virtue of an
automatic endorsement, require: (1) such insurance may not be canceled or
amended with respect to Landlord (or its designee(s) except upon 30 days written
notice by registered mail to Landlord (and such designee(s) by the insurance
company; and (2) Tenant shall be solely responsible for payment of premiums and
that Landlord (or its designee(s)) shall not be required to pay any premiums for
such insurance. The minimum limits of the comprehensive general liability policy
of insurance shall in no way limit or diminish Tenant's liability under other
provisions of this Lease.

                                     - 33 -
<PAGE>

            Section 26.03. The minimum limits of the comprehensive general
liability policy of insurance shall be subject to increase at any time, and from
time to time, after the commencement of the third (3rd) year of the term hereof
if Landlord in the exercise of its reasonable judgment shall deem the same
necessary for adequate protection and has been requested by the then existing
mortgagee. Within 30 days after demand therefor by Landlord, Tenant shall
furnish Landlord with evidence that such demand has been complied with.

                                   ARTICLE 27

                                  Miscellaneous

            Section 27.01. If at any time or times during the Term of this
Lease, the Rental reserved in this Lease is not fully collectible by reason of
any Requirement, Tenant shall enter into such agreements and take such other
steps (without additional expense to Tenant) as Landlord may request and as may
be legally permissible to permit Landlord to collect the maximum rents that may
from time to time during the continuance of such legal rent restriction be
legally permissible (and not in excess of the amounts reserved under this
Lease). Upon the termination of such legal rent restriction (a) the Rental shall
become and thereafter be payable hereunder in accordance with the amounts
reserved in this Lease for the remainder of the Term, and (b) Tenant shall pay
to Landlord, if legally permissible, an amount equal to (i) the items of Rental
that would have been paid pursuant to this Lease but for such legal rent
restriction less (ii) the rents paid by tenant to Landlord during the period or
periods such legal rent restriction was in effect. This provision shall survive
the expiration or earlier termination of this Lease to the maximum enforceable
extent.

            Section 27.02. If, in connection with Landlord's obtaining financing
for the Building, a banking, insurance or other recognized institutional lender
shall request reasonable modifications in this lease as a condition to such
financing, Tenant will not unreasonably withhold, delay, condition or defer its
consent thereto, provided that such modifications do not increase the
obligations of Tenant hereunder reduce Tenant's rights or remedies or materially
adversely affect the leasehold interest hereby created.

            Section 27.03. Tenant shall not place a load upon any floor of the
Premises exceeding the floor load per square foot which such floor was designed
to carry and any permitted load must be placed by Tenant, at Tenant's sole cost
and expense, so as to distribute the weight. Business machines and mechanical
equipment shall be placed and maintained by Tenant, at Tenant's sole cost and
expense, in settings sufficient in Landlord's reasonable judgment to absorb and
prevent vibration, noise and annoyance. If the Premises be or becomes infested
with vermin as a result of any misuse or neglect of the Premises by Tenant, its
agents, employees, visitors or licensees, Tenant shall at Tenant's expense cause
the same to be exterminated from time to time to the reasonable satisfaction of
Landlord and shall employ such exterminators and such exterminating company or
companies as shall be approved by Landlord.

                                     - 34 -
<PAGE>

            Section 27.04. Tenant shall not be entitled to exercise any option
granted to it by this lease, if any, at any time when Tenant is in default in
the performance or observance of any of the covenants, agreements, terms,
provisions or conditions on its part to be performed or observed under this
lease and Landlord has previously given Tenant notice of such default.

            Section 27.05. If Landlord has comparable space available in the
Building at a comparable rent, Tenant shall not occupy any space in the Building
(by assignment, sublease or otherwise) other than the Premises hereby demised,
except with the prior written consent of Landlord in each instance.

            Section 27.06. Landlord and Tenant represent that it has not dealt
with any person, firm or corporation in connection with this transaction other
than Trammell Crow Realty whose commission Landlord agrees to pay, and the
Landlord agrees to indemnify, defend and hold the Tenant harmless from any
damage or claim suffered by that other party as a result of any breach of this
representation.

            Section 27.07. The term "Landlord" as used in this lease means only
the owner, or the mortgagee in possession, for the time being of the Land and
Building (or the owner of a lease of the Building or the Land and Building), so
that in the event of any sale or sales of the Land and Building, or in the event
of a lease of the Building, or of the Land and Building, the Landlord shall be
and hereby is entirely freed and relieved of all covenants and obligations of
Landlord hereunder, except for any and all liabilities and obligation incurred
by Landlord prior to such sale or lease, and it shall be deemed and construed
without further agreement between the parties or their successors in interest,
or between the parties and the purchaser, at any such sale, or the said lessee
of the Building, or of the Land and Building, that the purchaser or the lessee
of the Building has assumed and agreed to carry out any and all covenants and
obligations of Landlord hereunder. Such purchaser or lessee shall be required by
Landlord to give notice to Tenant of its assumption. No general or limited
partner or shareholder of Landlord (including any general or limited partner or
shareholder, any assignee or successor of Landlord) or other holder of any
equity interest in Landlord shall be personally liable for the performance of
Landlord's obligations under this lease. The liability of Landlord (including
any assignee or successor of Landlord) for Landlord's obligations under this
lease shall be limited to Landlord's interest in the land and Building and
Tenant shall not look to any of Landlord's other assets in seeking either to
enforce Landlord's obligations under this lease or to satisfy a judgment for
Landlord's failure to perform such obligations.

            Section 27.08. The submission by Landlord of the lease in draft form
shall be deemed submitted solely for Tenant's consideration and not for
acceptance and execution. Such submission shall have no binding force or effect
and shall confer no rights nor impose any obligations on either party unless and
until both Landlord and Tenant shall have executed the lease and duplicate
originals thereof shall have been delivered to the respective parties.

                                     - 35 -
<PAGE>

            Section 27.09. The acknowledgments of the execution of this lease by
Landlord and Tenant are solely for the purpose of manifesting the respective
authorizations for execution. Neither Landlord nor Tenant shall record this
lease or any memorandum thereof without the consent of the party not proposing
such recording, and the violation of the provision shall be deemed a substantial
default hereunder.

            Section 27.10. This Lease shall be construed without regard to any
presumption or other rule requiring construction against the party causing this
Lease to be drafted. If any words or phrases in this Lease are stricken out or
otherwise eliminated, whether or not any other words or phrases have been added,
this Lease shall be construed as if the words or phrases so stricken out or
otherwise eliminated were never included in this Lease and no implication or
inference shall be drawn from the fact that such words or phrases were stricken
out or otherwise eliminated.

            Section 27.11. Landlord shall make available to Tenant on the
directory in the lobby of the Building five (5) listings, which listings may
include subtenants or others occupying the Premises in accordance with the terms
hereof. The initial listing shall be without charge to Tenant. From time to
time, Landlord shall revise the directory to reflect such changes in the
listings therein as Tenant may request, and Tenant within thirty (30) days after
demand by Landlord shall pay to Landlord, as Additional Rent, Landlord's cost in
making each revision that Tenant requests. Tenant may install a sign on the
entry door to the Premises.

            Section 27.12. If any of the provisions of this Lease, or the
application thereof to any person or circumstance, shall, to any extent, be
invalid or unenforceable, the remainder of this Lease, or the application of
such provisions to persons or circumstances other than those as to whom or which
it is held invalid or unenforceable, shall not be affected thereby and shall
remain valid and enforceable, and every provision of this Lease shall be valid
and enforceable to the fullest extent permitted by law.

            Section 27.13. Tenant hereby represents to Landlord that it is not
entitled, directly or indirectly, to diplomatic or sovereign immunity and Tenant
agrees that in all disputes arising directly or indirectly out of this Lease
Tenant shall be subject to service of process at its offices located within the
building and the exclusive jurisdiction for such actions shall be either in the
United States Court for the Southern District of New York or the New York State
Supreme Court for the County of New York. The provisions of this Section 27.13
shall survive the expiration of this Lease.

            Section 27.14. This Lease contains the entire agreement between the
parties and all prior negotiations and agreements are merged into this Lease .
This Lease may not be changed, abandoned or discharged, in whole or in part, nor
may any of its provisions be waived except by a written agreement that (a)
expressly refers to this Lease, (b) is executed by the party against whom
enforcement of the change, abandonment, discharge or waiver is sought and (c) is
permissible under the Mortgage(s).

                                     - 36 -
<PAGE>

            Section 27.15. Any apportionment or prorations of Rental to be made
under this Lease shall be computed on the basis of a three hundred sixty (360)
day year, with twelve (12) months of thirty (30) days each.

            Section 27.16 The laws of the State of New York applicable to
contracts made and to be performed wholly within the State of New York shall
govern and control the validity, interpretation, performance and enforcement of
this Lease, without reference to New York State's choice of law rules.

            Section 27.17. Each person executing this Lease on behalf of Tenant
hereby covenants, represents and warrants that Tenant is a duly incorporated or
duly qualified (if foreign) limited liability company and is authorized to do
business in the State of New York (a copy of evidence thereof to be supplied to
Landlord upon request); and that each person executing this Lease on behalf of
Tenant is an officer of Tenant and that he or she is duly authorized to execute,
acknowledge and deliver this Lease to Landlord (a copy of a resolution to that
effect to be supplied to Landlord upon request).

            Section 27.18. The captions and article headings are inserted only
as a matter of convenience and for reference and in no way define, limit or
describe the scope of this Lease nor the intent of any provision thereof.

            Section 27.19 The covenants, conditions and agreements contained in
this Lease shall bind and inure to the benefit of Landlord and Tenant and their
respective legal representatives, successors, and, except as otherwise provided
in this Lease, their assigns.

            Section 27.20. For the purposes of this Lease and all agreements
supplemental to this Lease, unless the context otherwise requires:

            (a) The words "herein", "hereof", "hereunder" and "hereby" and words
      of similar import shall be construed to refer to this Lease as a whole and
      not to any particular Article or Section unless expressly so stated.

            (b) Tenant's obligations hereunder shall be construed in every
instance as conditions as well as covenants, each separate and independent of
any other terms of this Lease.

            (c) Reference to Landlord as having "no liability" or being "without
liability" shall mean that Tenant shall not be entitled to terminate this Lease,
or to claim actual or constructive eviction, partial or total, or to receive any
abatement or diminution of rent, or to be relieved in any manner of any of its
other obligations hereunder, or to be compensated for loss or injury suffered or
to enforce any other right or liability whatsoever against Landlord under or
with respect to this Lease or with respect to Tenant's use or occupancy of the
Premises, except as

                                     - 37 -
<PAGE>

otherwise expressly provided in this Lease and provided that Tenant does not
waive any rights under law that are not expressly waived in this Lease.

            (d) Reference to "termination of this Lease" or "expiration of this
Lease" and words of like import includes expiration or sooner termination of
this Lease and the Term and the estate hereby granted or cancellation of this
Lease pursuant to any of the provisions of this Lease or to law. Upon the
termination of this Lease, the Term and estate granted by this Lease shall end
at noon on the date of termination as if such date were the Expiration Date, and
neither party shall have any further obligation or liability to the other after
such termination except (i) as shall be expressly provided for in this Lease,
and (ii) for such obligations as by their nature under the circumstances can
only be, or by the provisions of this Lease, may be, performed after such
termination, and, in any event, unless expressly otherwise provided in this
Lease, any liability for a payment (which shall be apportioned as of such
termination) which shall have accrued to or with respect to any period ending at
the time of termination shall survive the termination of this Lease.

            (e) Words and phrases used in the singular shall be deemed to
include the plural and vice versa, and nouns and pronouns used in any particular
gender shall be deemed to include any other gender.

            Section 27.21 By written notice sent to the Landlord prior to June
1, 2007, Tenant may cancel this Lease as of August 31, 2007 in which event when
the Lease expires and terminates shall become August 31, 2007 and the Use and
Occupancy charges set forth in Paragraph 2.01 shall take effect as of September
1, 2007.

            Section 27.22 Landlord shall, as it sole responsibility for
construction work, create demising walls with fire emergency doors at the places
located on Exhibit A and marked as "A" and "B". The area shown on Exhibit A as
cross hatched shall be a common area for both portions of the 19th floor.

            Section 27.23. This Lease is subject to Landlord's obtaining the
approval of the mortgagee, the Bank of America within twenty-one (21) days after
its execution.

            Section 27.24. Provided, Landlord's maintenance personnel coordinate
all access with the Tenant's designated personnel. The Landlord shall have the
right of access to the telephone control room and electricity panels contained
in the Tenant's premises for routine maintenance and emergencies. Landlord will
make all best efforts to give Tenant, if practical, twenty-four (24) hours
notice of its need to access the telephone room and electrical panel box.
Landlord acknowledges and agrees that due to Tenant's security policies, that
all Landlord and Landlord maintenance personnel may be required to sign-in at
the Tenant's reception, show identification and be escorted at all times while
in Tenant's premises.

                                     - 38 -
<PAGE>

            Section 27.25 Tenant will from time to time as requested by Landlord
provide Landlord with an Estoppel Certificate within five (5) business days of
receipt of such request. Failure to provide an Estoppel Certificate in a timely
manner shall be an Act of Default.

                  IN WITNESS WHEREOF, Landlord and Tenant have duly executed the
lease as of the year and date first above written.

                                LANDLORD:

                                TM PARK AVENUE LLC

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

                                TENANT:
                                EPSILON INTERACTIVE LLC

                                By:
                                   ----------------------------------------
                                   Al DiGuido, its President and Managing Member

                                     - 39 -
<PAGE>

                                TABLE OF EXHIBITS

Exhibit A   Diagram of Demised Premises Showing its Division

Exhibit B   Landlord's Work Letter

                                     - 40 -
<PAGE>

                                    EXHIBIT B

LANDLORD'S WORK

      Landlord will construct two (2) demising walls at the places set forth on
Exhibit A as "A" and "B". The demising walls will contain doors which may be
locked by the Tenant and opened from the Landlord's side only in the event of a
fire or similar emergency. In other respects the Premises are delivered as is
and the Landlord has no other work obligations under this Lease.

                                     - 41 -
<PAGE>

State of New York    )
County of New York   ) ss.:

On the ______ day of ___________________ in the year ______ before me, the
undersigned, a Notary Public in and for said State, personally appeared
__________________________, personally known to me or proved to me on the basis
of satisfactory evidence to be the individual(s) whose name(s) is (are)
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their capacity(ies), and that by his/her/their
signature(s) on the instrument, the individual(s), or the person upon behalf of
which the individual(s) acted, executed the instrument.

-----------------------------------
Notary Public

State of New York    )
County of New York   ) ss.:

On the ______ day of ___________________ in the year _____ before me, the
undersigned, a Notary Public in and for said State, personally appeared
__________________________, personally known to me or proved to me on the basis
of satisfactory evidence to be the individual(s) whose name(s) is (are)
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their capacity(ies), and that by his/her/their
signature(s) on the instrument, the individual(s), or the person upon behalf of
which the individual(s) acted, executed the instrument.

-----------------------------------
Notary Public

                                     - 42 -
<PAGE>

                              RULES AND REGULATIONS

      1. The sidewalks, driveways, entrances, passages, courts, lobbies,
esplanade areas, plazas, elevators, vestibules, stairways, corridors or halls
shall not be obstructed or encumbered by any tenant or used for any purpose
other than ingress and egress to and from the Premises and Tenant shall not
permit any of its employees, agents or invitees to congregate in any of said
areas. No doormat of any kind whatsoever shall be placed or left in any public
hall or outside any entry door of the Premises.

      2. No awnings or other projections shall be attached to the outside walls
of the Building. No curtains, blinds, shades or screens shall be attached to or
hung, in, or used in connection with any window or door of the Premises, without
the prior consent of Landlord which will not be withheld, delayed or conditioned
unreasonably. Landlord consents to all curtains, blinds, shades and screens
presently in the Premises. Such curtains, blinds, shades or screens must be of a
quality, type, design and color, and attached in the manner, reasonably approved
by the Landlord.

      3. No sign, insignia, advertisement, lettering, notice or other object
shall be exhibited, inscribed, painted or affixed by Tenant on any part of the
outside or inside (and which is visible from outside) other than from the
elevators the Premises of the Building without the prior consent of Landlord
which will not be withheld, delayed or conditioned unreasonably.

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

      5. No showcases or other articles shall be put in front of or affixed to
any part of the exterior of the Building nor placed in the public halls,
corridors or vestibules.

      6. The water and wash closets and other plumbing fixtures shall not be
used for any purposes other than those for which they were designed or
constructed, and no sweepings, rubbish, rags, acids or other substances shall be
thrown or deposited therein. All damages resulting from any misuse of the
fixtures shall be borne by the Tenant, who, or whose servants, employees,
agents, visitors or licensees shall have, caused the same. Any cuspidors or
containers or receptacles used as such in the Premises shall be emptied, cared
for and cleaned by and at the expense of Tenant.

      7. Except as otherwise expressly provided in the lease to which these
rules and regulations are annexed, no tenant shall in any way deface, any part
of the Premises or the Building.

                                     - 43 -
<PAGE>

      8. No vehicles, animals, fish except fish tanks, reptiles, insects or
birds of any kind shall be brought into or kept in or about the Premises.

      9. No noise, including, but not limited to, music or the playing of
musical instruments, recordings, radio or television which, in the reasonable
judgment of Landlord, might disturb other tenants of the Building, shall be made
or permitted by any tenant. Nothing shall be done or permitted in the Building
by any tenant which would impair or interfere with the use or enjoyment by any
other tenant of any other space in the Building.

      10. No tenant, nor any tenant's servants, employees, agents, visitors or
licensees, shall at any time bring or keep upon the Premises any inflammable,
combustible or explosive fluid, chemical or substance other than those normally
used in the ordinary course of Tenant's business.

      11. Additional locks or bolts of any kind which shall not be operable by
the master key for the Building shall not be placed upon any of the doors or
windows by any tenant, nor shall any changes be made in locks or the mechanism
thereof which shall make such locks inoperable by such master key. Each tenant
shall, upon the termination of its tenancy, turn over 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 furnished by Landlord,
such tenant shall pay to Landlord the cost thereof.

      12. All removals, or the carrying in or out of any safes, freight,
furniture, packages, boxes, crates or any other objects or matter of any
description must take place during such hours and in such elevators as Landlord
or its agent may reasonably determine from time to time. Landlord reasonably
reserves the right to inspect all objects and matter to be brought into the
Building and to exclude from the Building all objects and matter which violate
any of these Rules and Regulations or the lease of which these Rules and
Regulations are a part. Landlord may require any person leaving the Building
with any package or other objects or matter to submit a pass, listing such
package or object or matter, from the tenant from whose Premises the package or
object or matter is being removed, but the establishment and enforcement of such
requirement shall not impose any responsibility on Landlord for the protection
of any tenant against the removal of property from the Premises of such tenant.
Landlord shall in no way be liable to any tenant for damages or loss arising
from the admission, exclusion or ejection of any person to or from the Premises
or the Building under the provisions of this Rule 12 or of Rule 16 hereof.

      13. Tenant shall not occupy or permit any portion of the Premises to be
occupied as an office for a public stenographer or public typist, or for the
manufacture or sale of liquor, narcotics, dope, tobacco in any form, or as a
barber, beauty or manicure shop, or as a school, or as a hiring or employment
agency. Tenant shall not use the Premises or any part thereof, or permit the
Premises or any part thereof to be used for manufacturing, or for the sale at
retail or auction of merchandise, goods or property of any kind.

                                     - 44 -
<PAGE>

      14. No tenant shall obtain, purchase or accept for use in the Premises
coffee cart, towel, barbering, bootblacking, cleaning, floor polishing or other
similar services from any persons not authorized by Landlord in writing to
furnish such services. Such services shall be furnished only at such hours, in
such places within the Premises, and under such regulations, as may be
reasonably fixed by Landlord.

      15. Landlord shall have the right to prohibit any advertising or
identifying sign by any tenant which, in Landlord's reasonable judgment, tends
to impair the reputation of the Building or its desirability as a building for
offices, and upon notice from Landlord, such tenant shall refrain from and
discontinue such advertising or identifying sign.

      16. All persons entering and/or leaving the Building during hours other
than Business Hours may be required to sign a register.

      17. Tenant, before closing and leaving the Premises at any time, shall see
that all operable windows are closed and all lights are turned out. All entrance
doors in the Premises shall be left locked by tenant when the Premises are not
in use.

      18. Unless Landlord shall furnish electric energy hereunder as a service
included in the rent, Tenant shall, at Tenant's expense, provide artificial
light and electric energy for the employees of Landlord and/or Landlord's
contractors while doing janitor service or other cleaning in the Premises and
while making repairs or alterations in the Premises.

      19. The Premises shall not be used for lodging or sleeping or for any
immoral or illegal purpose.

      20. The requirements of tenants will be attended to only upon application
at the office of the Building. Employees of Landlord shall not perform any work
or do anything outside of their regular duties, unless under special
instructions from Landlord.

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

      22. There shall not be used in any space, or in the public halls of the
Building, either by any tenant or by any others, in the moving or delivery or
receipt of safes, freight, furniture, packages, boxes, crates, paper, office
material, or any other matter or thing, any hand trucks except those equipped
with rubber tires, side guards and such other safeguards as Landlord shall
require.

      23. Tenant shall not cause or permit any odors of cooking or other
processes or any unusual or objectionable odors to emanate from the Premises
which would annoy other tenants or create a public or private nuisance. No
cooking shall be done in the Premises except as is expressly permitted in the
foregoing lease.

                                     - 45 -
<PAGE>

      24. Landlord reserves the right to rescind, alter or waive any rule or
regulation at any time prescribed for the Building when, in its reasonable
judgment, it deems it necessary or desirable for the reputation, safety, care or
appearance of the Building, or the preservation of good order therein, or the
operation or maintenance of the Building, or the equipment thereof, or the
comfort of tenants or others in the Building. No rescission, alteration or
waiver of any rule or regulation in favor of one tenant shall operate as a
rescission, alteration or waiver in favor of any other tenant.

                                     - 46 -exv10w17

 

Exhibit 10.17

LEASE AGREEMENT

Between

KDC-REGENT I INVESTMENTS, LP

(Landlord)

and

EPSILON DATA MANAGEMENT, INC.

(Tenant)

Dated May 31, 2005

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	SECTION 1.

	 	PREMISES
	 	 	1	 
	SECTION 2.

	 	CONSTRUCTION OF THE LANDLORD IMPROVEMENTS AND
THE TENANT IMPROVEMENTS
	 	 	1	 
	SECTION 3.

	 	INITIAL TERM
	 	 	6	 
	SECTION 4.

	 	BASE RENT AND ADDITIONAL RENT
	 	 	7	 
	SECTION 5.

	 	RENEWAL OF THE TERM
	 	 	9	 
	SECTION 6.

	 	USE
	 	 	11	 
	SECTION 7.

	 	ALTERATIONS
	 	 	11	 
	SECTION 8.

	 	MAINTENANCE OF PREMISES
	 	 	12	 
	SECTION 9.

	 	UTILITIES
	 	 	15	 
	SECTION 10.

	 	SATELLITE DISH
	 	 	15	 
	SECTION 11.

	 	SIGNS AND FLAGPOLES
	 	 	16	 
	SECTION 12.

	 	EXPANSION OPTION
	 	 	16	 
	SECTION 13.

	 	LANDLORD’S RIGHT OF ACCESS
	 	 	20	 
	SECTION 14.

	 	TENANT’S INDEMNITY
	 	 	20	 
	SECTION 15.

	 	LANDLORD’S INDEMNITY
	 	 	20	 
	SECTION 16.

	 	INSURANCE
	 	 	21	 
	SECTION 17.

	 	WAIVER OF SUBROGATION
	 	 	22	 
	SECTION 18.

	 	CASUALTY
	 	 	23	 
	SECTION 19.

	 	CONDEMNATION
	 	 	24	 
	SECTION 20.

	 	COMPLIANCE WITH ENVIRONMENTAL LAWS
	 	 	24	 
	SECTION 21.

	 	COMPLIANCE WITH PUBLIC ACCOMMODATION LAWS
	 	 	26	 
	SECTION 22.

	 	LANDLORD’S WARRANTIES
	 	 	27	 
	SECTION 23.

	 	TENANT’S DEFAULT
	 	 	28	 
	SECTION 24.

	 	LANDLORD’S REMEDIES
	 	 	29	 
	SECTION 25.

	 	LANDLORD’S DEFAULT AND TENANT’S REMEDIES
	 	 	29	 
	SECTION 26.

	 	LATE CHARGES; INTEREST ON LATE PAYMENTS
	 	 	30	 
	SECTION 27.

	 	QUIET ENJOYMENT
	 	 	30	 
	SECTION 28.

	 	SUBORDINATION, ATTORNMENT & NON-DISTURBANCE
	 	 	31	 
	SECTION 29.

	 	LANDLORD’S SALE OF PREMISES
	 	 	31	 
	SECTION 30.

	 	BROKER’S COMMISSIONS
	 	 	31	 
	SECTION 31.

	 	ESTOPPEL CERTIFICATE
	 	 	31	 
	SECTION 32.

	 	HOLDING OVER
	 	 	31	 

Page i

 

	 	 	 	 	 	 	 
	SECTION 33.

	 	ASSIGNMENT AND SUBLETTING
	 	 	32	 
	SECTION 34.

	 	RIGHT OF FIRST OFFER
	 	 	32	 
	SECTION 35.

	 	MISCELLANEOUS
	 	 	32	 
	SECTION 36.

	 	TIME OF ESSENCE
	 	 	35	 
	SECTION 37.

	 	VALIDITY OF AGREEMENT
	 	 	35	 
	SECTION 38.

	 	GUARANTY
	 	 	35	 
	SECTION 39.

	 	INCENTIVES
	 	 	37	 
	SECTION 40.

	 	ARBITRATION
	 	 	37	 

EXHIBITS

	 	 	 
	A.

	 	Outline Specifications
	B.

	 	The Land
	C.

	 	Final Tenant Improvements Plans and Specifications
	D.

	 	Tenant Allowances
	E.

	 	Form of Tenant Acknowledgment Letter
	F.

	 	Knowledge Individuals
	G.

	 	Form of Subordination Non-Disturbance and Attornment Agreement
	H.

	 	Form of Estoppel Certificate
	I.

	 	Form of Guaranty
	J.

	 	Approved General Contractors and Major Subcontractors
	K.

	 	Title Exceptions

Page ii

 

LEASE AGREEMENT

THIS LEASE AGREEMENT (this Lease) is dated as of May 31, 2005, (the Effective Date), between
KDC-REGENT I INVESTMENTS, LP, a Texas limited partnership (Landlord), and EPSILON DATA MANAGEMENT,
INC., a Delaware corporation (Tenant).

RECITALS

	A.	 	Landlord desires to design, construct, and lease to Tenant a shell building (the Building)
and other improvements (the Building and other improvements specified in the Outline
Specifications attached hereto as Exhibit A are sometimes referred to collectively as
the Landlord Improvements) on the real property owned by Landlord and described on Exhibit
B (the Land), in accordance with the terms and subject to the conditions of this Lease.
	 
	B.	 	Tenant desires to have constructed and to lease from Landlord the Landlord Improvements in
accordance with the terms and subject to the conditions of this Lease.
	 
	C.	 	Tenant desires to construct for its use additional interior improvements in the Building in
accordance with the terms and subject to the conditions of this Lease.

AGREEMENTS

Landlord and Tenant (sometimes referred to jointly as the parties or individually as a party) agree
as follows:

Section 1. Premises.

Landlord shall design, construct, and lease to Tenant, and Tenant shall lease from
Landlord, the Land and the Landlord Improvements. The Land, the Building, the Landlord
Improvements, and the Tenant Improvements (defined below) are referred to as the Premises.
Landlord shall construct as part of the Landlord Improvements parking spaces equal to a
ratio of not less than 4.5 spaces per 1,000 square feet of the Building (338 parking spaces
for the initial Landlord Improvements).

Section 2. Construction of the Landlord Improvements and the Tenant Improvements.

	 	(a)	 	Landlord shall furnish, at Landlord’s sole cost and expense, all of the
materials, labor, and equipment necessary for the design and construction of the
Landlord Improvements in accordance with the Outline Specifications. Landlord shall
construct the Landlord Improvements in a good and workmanlike manner, and in accordance
with all applicable statutes and building codes, governmental rules, regulations, and
orders, and restrictive covenants applicable to the Premises (Legal Requirements).
	 
	 	(b)	 	Tenant shall retain space planners, architects, and engineers reasonably
approved by Landlord to design all interior improvements (including, without
limitation, space planning, preparation of the Final Tenant Improvements Plans and
Specifications in the manner set forth below, special lighting, interior demising
walls, floor and wall coverings, furniture systems, security systems, telephone and
data cabling, excess HVAC for computer rooms, equipment, etc.)

1

 

	 	 	 	desired by Tenant (the Tenant Improvements). On or before 90 days after execution
of this Lease, Tenant shall cause proposed Tenant Improvements Design Development
Plans for the Tenant Improvements to be prepared and delivered to Landlord. Within
10 days after receipt of the proposed Tenant Improvements Design Development Plans,
Landlord shall approve or reject the proposed Tenant Improvements Design Development
Plans. If Landlord rejects the proposed plans, Landlord must specify in sufficient
detail the reason(s) for its rejection. Tenant shall revise the proposed Tenant
Improvements Design Development Plans based on Landlord’s comments and resubmit the
plans for Landlord’s approval. Upon Landlord’s approval, the proposed Tenant
Improvements Design Development Plans will constitute the Tenant Improvements Design
Development Plans. Within 90 days after Landlord’s approval of the Tenant
Improvements Design Development Plans, Tenant shall cause proposed Final Tenant
Improvements Plans and Specifications to be prepared in accordance with the Tenant
Improvements Design Development Plans. Within 10 days after receipt of the proposed
Final Tenant Improvements Plans and Specifications, Landlord shall approve or reject
the proposed Final Tenant Improvements Plans and Specifications. If Landlord
rejects the proposed Final Tenant Improvements Plans and Specifications, Landlord
must specify in sufficient detail the reason(s) for Landlord’s rejection. Tenant
shall revise the proposed Final Tenant Improvements Plans and Specifications and
resubmit the plans for Landlord’s approval. If Landlord has not notified Tenant of
Landlord’s disapproval within the 10-day period, Landlord will be deemed to have
approved the proposed Final Tenant Improvements Plans and Specifications. Upon
Landlord’s actual or deemed approval, the proposed Final Tenant Improvements Plans
and Specifications will constitute the Final Tenant Improvements Plans and
Specifications. The Final Tenant Improvements Plans and Specifications will be
designated as Exhibit C to this Lease, but need not be attached to this
Lease. Landlord’s approvals under this Section 2(b) may not be unreasonably
withheld, conditioned, or delayed, except that any portions of the Tenant
Improvements that require structural attachment(s) to the Building or attachment(s)
to any Building MEP system are subject to approval by Landlord in its sole
discretion.
	 
	 	(c)	 	Landlord appoints Murray W. Newton, Don Mills, and James Williams as its
representatives to work with Tenant in the preparation and approval of Final Tenant
Improvements Plans and Specifications. Tenant appoints Kris Hopson, Dick Corrigan and
Jeff Debruin as its representatives to review the Tenant Improvements Design
Development Plans, the proposed Final Tenant Improvements Plans and Specifications, and
the Final Tenant Improvements Plans and Specifications so as not to delay unreasonably
the completion of the Tenant Improvements. Both Landlord and Tenant may replace its
representative(s) with other representative(s) at their discretion; and Landlord and
Tenant shall advise the other party of such substitution.
	 
	 	(d)	 	Landlord shall provide Tenant with allowances as specified in Exhibit D
attached hereto (the Tenant Allowances).

2

 

	 	(e)	 	Landlord shall commence construction of the Building and other Landlord
Improvements as soon as practicable after the date of this Lease but no later than
thirty (30) days after the Effective Date. The commencement of site grading or site
excavation will constitute the commencement of construction for purposes of the
foregoing requirement. Landlord shall diligently proceed with the construction of the
Building and other Landlord Improvements and shall use commercially reasonable efforts
to (i) complete the Building and other Landlord Improvements in substantial accordance
with the Outline Specifications (except for such seasonal landscaping items set forth
in the Outline Specifications which are to be completed at a later date) (Substantial
Completion) and (ii) deliver possession of same to the Tenant by November 14, 2005.
Notwithstanding anything in this Lease to the contrary, a certificate from Landlord’s
architect that the Building and other Landlord Improvements have been completed in
substantial accordance with the Outline Specifications shall confirm that Substantial
Completion of the Building and other Landlord Improvements has occurred, absent
manifest error.
	 
	 	(f)	 	Landlord shall coordinate with Tenant so that Tenant and its contractor for the
Tenant Improvements can accompany Landlord and its architect when they inspect the
Building in connection with the architect’s issuance of the certificate of Substantial
Completion under Section 2(e). Landlord shall complete all punch list items for the
Landlord Improvements within two weeks after Tenant delivers the punch list to
Landlord; but if Tenant prevents Landlord from completing any punch list item within
such period of time, Landlord’s time for completing the item will be extended one day
for each day of Tenant Delay (defined below).
	 
	 	(g)	 	Except as hereinafter provided, if delays in the commencement or completion of
the construction of the Building or other Landlord Improvements occur by reason of
acts, omissions, failure to timely act or respond, or interference with construction of
the Building or the other Landlord Improvements on the part of Tenant or those acting
for or under the direction of Tenant (including, without limitation, its agents,
employees, contractors, consultants, and subcontractors, all such delays being referred
to as Tenant Delays) or for any other reasons beyond the reasonable control of Landlord
(which Tenant Delays and other delays are collectively referred to as Excused Delays),
the dates established above for the commencement of construction, Substantial
Completion and delivery of possession will be postponed by the aggregate duration of
the Excused Delays; provided, however that Excused Delays, other than days of Tenant
Delay, shall not postpone the April 4, 2006 date set forth in Section 4(e)(iii) beyond
October 5, 2006. Non-availability or shortages of labor or materials, local strikes,
lockouts, and inclement weather will constitute Excused Delays. Any inclement weather
that prevents Landlord’s general contractor from working on a normal work day (Monday
through Saturday) will constitute an Excused Delay to the extent that the days lost due
to inclement weather exceeds three work days per calendar month, on a month by month
basis.
	 
	 	(h)	 	Upon request by Tenant after the Building is dried in, Landlord, in its sole
discretion, may allow Tenant and Tenant’s employees and contractors to enter the
Building for the purpose of installing the Tenant Improvements in accordance with the
Final Tenant Improvement Plans and Specifications and all Legal Requirements. Tenant
shall ensure that its employees and contractors do not

3

 

	 	 	 	interfere with Landlord’s completion of the construction of the Landlord
Improvements. Tenant shall indemnify, defend, and hold Landlord harmless from and
against any damage or delay caused by Tenant’s early entry. Entry by Tenant’s
employees and contractors for this limited purpose will not constitute Tenant’s
acceptance of the Landlord Improvements or give rise to any obligation to pay Base
Rent.
	 
	 	(i)	 	Landlord shall incorporate only new materials and equipment into the
construction of the Landlord Improvements. Landlord warrants the Landlord Improvements
including, without limitation, the foundations, slab, structural frame, roof deck, and
exterior walls of the Building against defective design, workmanship, and materials,
latent or otherwise, for a period of one year from the date of Substantial Completion
(the Warranty Period). Landlord shall repair or replace at its sole cost and expense
any defective item of Landlord Improvements occasioned by defective design,
workmanship, or materials that Tenant discovers during the Warranty Period. Upon the
expiration of the Warranty Period, Landlord shall cause the material and labor
warranties for the general contractor, the roof on the Building, the window glazing and
the mechanical, including HVAC, electric and plumbing systems to be assigned to Tenant
with no reduction in the unelapsed warranty periods or other benefits thereunder; in
addition, Landlord shall deliver to Tenant all other continuing assignable guaranties
and warranties received by Landlord in connection with the construction of the Landlord
Improvements and shall assign to Tenant Landlord’s interest in those guaranties and
warranties by means of a duly executed and acknowledged assignment in form and
substance reasonably satisfactory to Landlord and Tenant. Notwithstanding the
foregoing, Landlord has no obligation to assign any warranty or guaranty to Tenant if
Landlord is obligated to maintain an item covered by the warranty or guaranty pursuant
to Section 8 of this Lease. From and after the expiration of the Warranty Period,
Landlord shall cooperate with Tenant in Tenant’s enforcement, at Tenant’s sole cost and
expense, of any express warranties or guaranties of workmanship or materials for the
Landlord Improvements given by subcontractors, architects, draftsmen, or materialmen
that guarantee or warrant against defective design, workmanship, or materials for a
period of time in excess of the Warranty Period. The obligations Landlord undertakes
under the terms of this subsection are in addition to the maintenance and repair
obligations that Landlord undertakes under other terms of this Lease.
	 
	 	(j)	 	Landlord shall complete construction and equipping of the Landlord Improvements
free of mechanic’s liens or other liens, and shall defend, indemnify and hold Tenant
harmless from and against all claims, actions, losses, costs, damages, expenses,
liabilities and obligations, including, without limitation, reasonable legal fees,
resulting from (A) the assertion or filing of any claim for amounts alleged to be due
to the claimant for labor, services, materials, supplies, machinery, fixtures or
equipment furnished in connection with the construction of the Landlord Improvements,
(B) the foreclosure of any mechanic’s or materialmen’s lien that allegedly secures the
amounts allegedly owed to the claimant, or (C) any other legal proceedings initiated in
connection with that claim.

4

 

	 	(k)	 	Landlord shall afford Tenant and its contractors reasonable access to the
Landlord Improvements during construction for the purposes of inspecting the Landlord
Improvements.
	 
	 	(l)	 	Throughout the period between the date on which Landlord commences construction
of the Landlord Improvements and the date of Substantial Completion, Landlord shall
maintain in force with respect to the Landlord Improvements a policy of multiple peril
(all-risk) builder’s risk insurance on a completed value basis in an amount equal to
the full replacement cost of the Landlord Improvements. That policy must name Tenant
as an additional insured, as its interests may appear, and must provide that coverage
will continue for Tenant’s benefit notwithstanding any act or omission on Landlord’s
part. The certificate of insurance evidencing that policy must provide that no
cancellation, surrender or material change will become effective unless Tenant receives
written notice at least 30 days in advance of the time at which that cancellation,
surrender or material change becomes effective.
	 
	 	(m)	 	Tenant shall furnish, at Tenant’s sole cost and expense (but subject to payment
by Landlord of the Tenant Allowances), all of the materials, labor, and equipment
necessary for the design and construction of the Tenant Improvements in accordance with
the Final Tenant Improvements Plans and Specifications. Tenant shall construct the
Tenant Improvements with all due diligence in a good and workmanlike manner and in
accordance with all applicable Legal Requirements and the Final Tenant Improvements
Plans and Specifications. Tenant shall incorporate only new materials and equipment
into the construction of the Tenant Improvements. Unless otherwise approved in writing
by Landlord, such approval not to be unreasonably withheld, Tenant may only use the
general contractors and major subcontractors identified as specified in Exhibit
J in constructing the Tenant Improvements.
	 
	 	(n)	 	Tenant shall diligently complete construction and equipping of the Tenant
Improvements free of mechanic’s liens or other liens, and shall defend, indemnify and
hold Landlord harmless from and against all claims, actions, losses, costs, damages,
expenses, liabilities and obligations, including, without limitation, reasonable legal
fees, resulting from (A) the assertion or filing of any claim for amounts alleged to be
due to the claimant for labor, services, materials, supplies, machinery, fixtures or
equipment furnished in connection with the construction of the Tenant Improvements, (B)
the foreclosure of any mechanic’s or materialmen’s lien that allegedly secures the
amounts allegedly owed to the claimant, or (C) any other legal proceedings initiated in
connection with that claim.
	 
	 	(o)	 	Tenant shall afford Landlord and its contractors reasonable access to the
Tenant Improvements during construction for the purposes of inspecting the Tenant
Improvements.
	 
	 	(p)	 	Tenant shall promptly provide Landlord with as-built drawings of the Tenant
Improvements upon completion of construction thereof. Landlord shall provide Tenant
with as-built drawings of the Building and other Landlord Improvements as well as all
instructions and operator’s manuals pertaining to any equipment

5

 

	 	 	 	installed by Landlord within the Building within ninety (90) days after the date of
Substantial Completion.
	 
	 	(q)	 	Prior to the Commencement Date, Landlord shall provide Tenant a certificate
from Landlord’s architect showing the rentable area of the Building (Building Square
Footage) measured in accordance with the method of measuring rentable area in a single
tenant building as specified in the Standard Method for Measuring Floor Area in Office
Buildings published by the Building Owners and Managers Association International
(BOMA) in ANSI Z65.1-1996.

Section 3. Initial Term.

	 	(a)	 	Subject to Section 3(c), the term of this Lease (the Initial Term) is the
period that commences on the latter of (i) May 14, 2006, or (ii) six months after the
date of Substantial Completion and tender of possession of the Landlord Improvements to
Tenant (the Commencement Date) and that expires at 11:59 p.m. (Dallas, Texas local
time) on either the day prior to the 12th anniversary of the Commencement Date, if the
Commencement Date occurs on the first day of a calendar month, or on the day prior to
the 12th anniversary of the first day of the first full calendar month following the
calendar month in which the Commencement Date occurs, if the Commencement Date does not
occur on the first day of a calendar month, whichever is applicable (the Expiration
Date). The term Lease Year means each 12 calendar month period beginning on the
Commencement Date. The first Lease Year includes any partial calendar month if the
Commencement Date is not the first day of a calendar month.
	 
	 	(b)	 	Tenant has the right to renew the term of this Lease, as set forth in Section 5
below, and the Initial Term and any Renewal Term with respect to which Tenant exercises
that option in accordance with Section 5 are collectively called the Term in this
Lease.
	 
	 	(c)	 	If the date of Substantial Completion and tender of possession of the Landlord
Improvements to Tenant does not occur by December 6, 2005, solely by reason of Tenant
Delays or by reason of casualty damage covered by Section 18, then the Commencement
Date will remain June 5, 2006, and Tenant shall commence paying Base Rent on June 5,
2006.
	 
	 	(d)	 	Within 15 days after Substantial Completion occurs, the parties will execute an
Acknowledgment Letter in substantially in the form of Exhibit E.

6

 

Section 4. Base Rent and Additional Rent.

	 	(a)	 	Assuming the Building Square Footage is at least 75,000 rentable square feet
and subject to adjustment as provided in Sections 4(b) and 39 and in Exhibit D,
Tenant shall pay to Landlord base annual rent (Base Rent) for the Premises beginning on
the Commencement Date as follows:

	 	 	 	 	 	 	 	 	 
	Lease Years	 	Annual Base Rent	 	 	Monthly Base Rent	 
	1-4
	 	$	992,250	 	 	$	82,687.50	 
	 
	 	 	 	 	 	 	 	 
	5-8
	 	$	1,053,000	 	 	$	87,750.00	 
	 
	 	 	 	 	 	 	 	 
	9-12
	 	$	1,117,500	 	 	$	93,125.00	 

	 	(b)	 	If the certificate of Landlord’s architect provided under Section 2(q) shows
that the Building Square Footage is less than 75,000 rentable square feet, then the
Annual Base Rent and Monthly Base Rent numbers specified above, will be decreased by
multiplying them by a number whose numerator is the Building Square Footage and whose
denominator is 75,000. The full amount of the Tenant Allowances shall be paid to
Tenant and will not be reduced even if the Building Square Footage is determined to be
less than 75,000 rentable square feet. Any adjustment of the Base Rent under this
Section 4(b) will be specified in the Acknowledgement Letter.
	 
	 	(c)	 	If the Commencement Date occurs on a day other than the first day of a calendar
month, then the Base Rent for the month in which the Commencement Date occurs will be
equal to the monthly installment amount specified above multiplied by a fraction, the
numerator of which is the number of days in the period starting on the Commencement
Date and ending on the last day of that month, and the denominator of which is the
total number of days in that month.
	 
	 	(d)	 	If a termination of this Lease occurs prior to the Expiration Date for reasons
other than Tenant’s default and if the effective date of termination is other than the
last day of a calendar month, the parties will prorate the Base Rent payable with
respect to the calendar month in which the effective date of termination occurs based
on the number of days in that month, and Landlord shall promptly refund to Tenant,
without demand, setoff or deduction, any previously paid Base Rent attributable to any
period of time following the termination date.
	 
	 	(e)	 	Subject to Section 3(c), if the date of Substantial Completion and the tender
of possession of the Landlord Improvements does not occur by the following dates (each
of which is subject to extension by one day for each day of Excused Delay [except that
the April 4, 2006 date set forth in Section 4(e)(iii) shall not be extended beyond
October 5, 2006 unless the additional delay is caused by Tenant Delay]):

	 	(i)	 	December 6, 2005, then Tenant will receive one day of free Base
Rent and payment by Landlord for, or reimbursement of, all charges for the per
diem cost of all utilities, Impositions and other operating costs for the
Premises for each day of delay through February 3, 2006;

7

 

	 	(ii)	 	February 4, 2006, then Tenant will receive three days of free
Base Rent and payment by Landlord for, or reimbursement of, all charges for the
per diem cost of all utilities, Impositions and other operating costs for the
Premises for each additional day of delay thereafter; and
	 
	 	(iii)	 	April 4, 2006, then Tenant may, at its option, by giving
notice to Landlord at any time thereafter until Landlord achieves substantial
completion of the Landlord Improvements, either:

	 	(A)	 	terminate this Lease effective as of the date
Tenant gives such notice;
	 
	 	(B)	 	elect to take over completion of the Landlord
Improvements, in which event Tenant shall be entitled to a credit
against Base Rent for all reasonable costs incurred by Tenant in
completing the Landlord Improvements; or
	 
	 	(C)	 	require Landlord to complete the Landlord
Improvements and continue to allow free Base Rent and expense payment
(or reimbursement) to accrue as provided in Section 4(e)(ii).

	 	(f)	 	As used herein, Impositions shall mean all the real estate taxes and
installments of special assessments levied against the Premises and attributable to any
period of time following the Commencement Date.
	 
	 	(g)	 	Landlord shall file a request with all taxing authorities that issue tax bills
or tax statements for Impositions on the Premises to deliver the tax bills or tax
statements directly to Tenant. Tenant shall promptly deliver to Landlord copies of all
tax bills and tax statements Tenant receives directly from the taxing authorities and
Tenant shall pay all such tax bills or tax statements prior to delinquency. At least
30 days prior to the date each such tax bill or tax statement would become delinquent,
Tenant shall deliver to Landlord a copy of a paid receipt that the taxing authority
issues or a Certificate of No Tax Due issued by a reputable title insurance company, at
Tenant’s expense, demonstrating the payment of that Imposition. If Tenant does not
timely provide proof of the payment of any Imposition as required in the prior
sentence, Landlord may pay the Imposition and bill Tenant therefor. Tenant will be
responsible for any interest or penalties that accrue with respect to all Impositions
not timely paid by Tenant under this Section 4(g).
	 
	 	(h)	 	The foregoing will not require Tenant to pay any municipal, state or federal
income or excess profits taxes assessed against Landlord, or any municipal, state or
federal capital levy, estate, succession, inheritance or transfer taxes of Landlord, or
corporation franchise taxes imposed upon the corporate owner of the fee of the
Premises. Moreover, with respect to Impositions that may lawfully be paid in
installments over a period of years, with or without interest, the foregoing will not
require Tenant to pay any portion of those installments or interest that become due to
the taxing authority after the Expiration Date, as extended. With respect to the
Impositions levied in respect of any period of time within which either the
Commencement Date or the Expiration Date occurs, Tenant must only pay a proportionate
part of those Impositions, which part will

8

 

	 	 	 	bear the same ratio to the total amount of those Impositions as the number of days
in the period between the Commencement Date and the end of that period of time or in
the period between the beginning of that period of time and the Expiration Date,
whichever is applicable, bears to the total number of days in that period of time.
	 
	 	(i)	 	Tenant may contest in good faith and at its expense the amount or validity of
any Imposition that it is obligated to pay in accordance with the foregoing and, if
successful in that regard, is entitled to recover from Landlord any refund paid to
Landlord as a result of that successful contest. Landlord shall join in any contest
undertaken by Tenant in accordance with the foregoing at Tenant’s expense if the
provisions of any law, rule or regulation at the time in effect require that the
proceedings be brought by or in the name of Landlord. Notwithstanding anything in this
Lease to the contrary, during any tax contest, Tenant agrees to comply with any
jurisdictional requirements relating to payment before contest necessary to prevent a
tax foreclosure.
	 
	 	(j)	 	Tenant will pay Base Rent and additional rent to Landlord at the address set
forth in Section 35(j) or at such other address as Landlord may from time to time
designate. Following Substantial Completion, Tenant’s obligation to pay Base Rent and
other amounts under this Lease is independent of the performance by Landlord of its
obligations under this Lease; provided, nothing in this sentence affects Tenant’s
rights to set off under Section 25.

Section 5. Renewal of the Term.

	 	(a)	 	Except as otherwise provided in Section 12, Tenant may renew the Term for two
successive renewal terms (Renewal Terms) of 60 months each so long as this Lease is in
full force and effect and Tenant is not in default beyond all applicable grace, notice
and cure periods in respect of the performance of any obligation it undertakes under
the terms of this Lease both at the time that Tenant exercises each renewal option and
at the time the Renewal Terms commence. Tenant will exercise each renewal option, if
at all, by delivering written notice (the Option Notice) to Landlord not less than two
hundred seventy (270) days prior to the Expiration Date. The provisions of this Lease
will govern the relationship between the parties during each Renewal Term, except that
the Base Rent for each Renewal Term will be determined as provided below.
	 
	 	(b)	 	The annual Base Rent payable during each Renewal Term will be equal to 95% of
the product of the Fair Market Rent (as defined below and as determined in accordance
with the procedures described in this Section 5(b)) as of the date Tenant exercises its
option to renew the Term for the ensuing Renewal Term times the Building Square Footage
(or, if Tenant has exercised its Expansion Option under Section 12, times the sum of
the Building Square Footage plus the number of rentable square feet in the Expansion).
Initially Landlord will determine the Fair Market Rent by using its good faith
judgment. Landlord will use its best efforts to provide written notice of its
determination in that regard within 15 days after the date Tenant sends the Option
Notice, but in no event later than 30 days after that date. Tenant will have a period
(the Tenant Review Period) of 30 days following the date of its receipt of Landlord’s
notice of the rent it proposes as the Fair Market Rent within which to accept
Landlord’s proposal or

9

 

	 	 	 	to provide Landlord Tenant’s objections to Landlord’s proposal. If Tenant objects
to Landlord’s initial proposal or fails to affirmatively accept that proposal in
writing, the parties will use their best efforts to reach agreement with respect to
the Fair Market Rent, but, if the parties fail to agree within 15 days after the
expiration of the Tenant Review Period, determination of the Fair Market Rent will
be made in accordance with the terms of Subsections 5(b)(i) through 5(b)(v) below.
If Landlord fails to provide Tenant written notice of its initial proposal with
respect to the Fair Market Rent within the 30-day period set forth above, Tenant may
commence negotiations by providing the initial notice, in which event Landlord will
have a period (the Landlord Review Period) of 30 days following the date of its
receipt of Tenant’s notice of the rent it proposes as the Fair Market Rent within
which to accept Tenant’s proposal or to provide Tenant Landlord’s objections to
Tenant’s proposal. If Landlord objects to Tenant’s initial proposal or fails to
affirmatively accept that proposal in writing, the parties will use their best
efforts to reach agreement with respect to the Fair Market Rent, but, if the parties
fail to agree within 15 days after the expiration of the Landlord Review Period,
determination of the Fair Market Rent will be made in accordance with the terms of
Subsections 5(b)(i) through 5(b)(v) below. If determination of the Fair Market Rent
in accordance with the following procedures becomes necessary, each party will place
in a separate sealed envelope its final proposal as to the Fair Market Rent that
will apply during the ensuing Renewal Term.

	 	(i)	 	The parties will meet within five business days after the
expiration of the Tenant Review Period or the Landlord Review Period, whichever
is applicable, exchange the sealed envelopes and open those envelopes in the
presence of each other. If the parties do not agree upon the Fair Market Rent
within 30 days following the date on which the exchange and opening of the
envelopes occur, Tenant may rescind its exercise of the option to renew the
Term by the delivery of written notice to Landlord prior to the expiration of
that 30-day period. If the parties do not agree upon the Fair Market Rent
within that 30-day period and if Tenant fails to rescind its exercise of the
option to renew the Term in accordance with the foregoing terms of this
subsection (i), then the parties will jointly appoint a single arbitrator
within the period that expires 40 days following the date on which the exchange
and opening of the envelopes occur. The arbitrator must be a real estate
broker who, as his or her primary livelihood, has been active in the leasing of
commercial properties in Dallas County, Texas, during the 10-year period
preceding the date of his or her appointment. Neither Tenant nor Landlord may
select as an arbitrator any broker or firm to whom it has paid commissions or
fees in the three year period prior to the proposed engagement. Prior to the
arbitrator’s appointment, neither party will reveal to prospective arbitrators
under consideration by the parties its opinion regarding the Fair Market Rent.
The sole issue submitted to the arbitrator for determination will be which
party’s final proposal regarding the Fair Market Rent is closest to the actual
Fair Market Rent, as independently determined by the arbitrator.
	 
	 	(ii)	 	Within 30 days after the date of his or her appointment, the
arbitrator will give the parties written notice of its determination as to
which of the parties’ final proposals regarding the Fair Market Rent will apply during
the ensuing Renewal Term.

10

 

	 	 	 	 
	 
	 	(iii)	 	The decision of the arbitrator is final and binding on the
parties.
	 
	 	(iv)	 	If the parties fail to agree upon the appointment of an
arbitrator within the time specified above, that appointment will be made by
the Dallas Office of the American Arbitration Association.
	 
	 	(v)	 	The parties will share the cost of the arbitration equally.

	 	(c)	 	Fair Market Rent means the annual rental rate per square foot that comparable
buildings located in the same market area as the Building and that are comparable in
size, design, and quality to the Building would accept in comparable transactions
involving a tenant whose creditworthiness is comparable to that of Tenant and whose
other obligations under the lease would be comparable to those undertaken by Tenant in
this Lease. In any evaluation of comparable transactions, the arbitrator will consider
the annual rental rates per square foot, the use to which the tenant puts the leased
premises, the extent of the tenant’s liability for the performance of the covenants set
forth in the lease, abatement provisions reflecting free rent or no rent during the
period of construction or subsequent to the commencement date as to the building in
question, brokerage commissions, if any, that would be payable by the landlord, length
of the lease term, size and location of premises being leased, building standard work
letter or tenant improvement allowances, if any, and other generally applicable
conditions of tenancy for those comparable transactions. The intent is that Tenant
will obtain the same rent and other economic benefits that a landlord would otherwise
give in a comparable transaction and that Landlord will make and receive the same
economic payments and concessions that other landlords would otherwise make and receive
in comparable transactions.

Section 6. Use.

Tenant may use the Premises for any lawful use. It is intended that Tenant will initially
use the Premises for general offices, telecommunications, computer and data support
functions, or other purposes consistent with the character of the Building and for lawful
purposes related to Tenant’s business and in compliance with all Legal Requirements
(Intended Use).

Section 7. Alterations.

	 	(a)	 	During the Term, Tenant shall not make structural exterior alterations to the
Premises (including, without limitation, alterations to the MEP systems serving the
Building (Structural Alterations) without Landlord’s prior written consent, which
consent shall not be unreasonably withheld. Tenant must provide Landlord with a
complete set of plans for any proposed Structural Alterations. Tenant shall construct
all Structural Alterations in substantial accordance with the approved plans.
Notwithstanding the preceding, Tenant will have the right, without Landlord’s consent,
to make non-structural alterations (Non-Structural Alterations) to the interior of the
Premises. In making any Structural Alterations,

11

 

	 	 	 	Tenant shall notify Landlord at least 30 days prior to commencement of construction;
and in making any Structural or Non-Structural Alterations, Tenant shall comply with
all Legal Requirements and perform same in a good and workmanlike manner. Tenant
shall promptly deliver to Landlord complete and accurate as-built plans for any
Structural Alterations. In the event that Tenant’s Non-Structural Alterations
consists of moving interior partitions, Tenant shall so notify Landlord; upon
Landlord’s written request, Tenant shall provide as-built plans for the relocation
of such interior partitions.
	 
	 	(b)	 	Tenant’s trade fixtures, furnishings and equipment in the Premises will remain
Tenant’s property for all purposes and Tenant may remove them at its option and expense
at any time on or before the Expiration Date. Upon the expiration of the Term or any
earlier termination of this Lease, Tenant shall surrender the Premises in good
condition and repair, except for ordinary wear and tear, casualty damage, and damage
that Landlord has the obligation to repair under the terms of this Lease. The
foregoing covenant does not obligate Tenant to remove Structural or Non-Structural
Alterations or other leasehold improvements made with respect to the Premises. All
Tenant Improvements and other property of Tenant not timely removed from the Premises
shall become part of the Premises and will remain with the Premises upon the expiration
of the Term or any earlier termination of this Lease.
	 
	 	(c)	 	Tenant shall defend, indemnify and save harmless Landlord against any and all
mechanic’s and other liens filed arising out of any work performed, materials furnished
or obligations incurred in connection with Structural or Non-Structural Alterations.
If Tenant does not procure the satisfaction or discharge of all liens for which Tenant
is responsible hereunder as and when required by this Lease, by bonding, payment or
otherwise Landlord may, upon 30 days’ prior written notice to Tenant, pay the amount of
any lien or discharge the same by deposit or, alternatively, by bond or in any manner
according to law, together with reasonable expenses incurred by Landlord, including all
reasonable legal fees and such expenses shall be payable by Tenant as additional rent
hereunder within 30 days after demand.

Section 8. Maintenance of Premises.

	 	(a)	 	During the Term, Landlord shall maintain only the following in good condition
at its expense: the structure of the Building, including, without limitation the roof,
roof membrane, foundation, floor slab, and load-bearing and exterior walls (the
Structural Components). If, in order for a Structural Component of the Building to
remain in good condition, replacement of that component becomes necessary, Landlord’s
obligation with respect to that Structural Component includes the obligation to replace
it.
	 
	 	(b)	 	Landlord shall accomplish all maintenance for which it is responsible as soon
as practicable following receipt of notice from Tenant. If a hazardous or emergency
situation exists, however, Landlord shall have the maintenance performed as soon as
possible.
	 
	 	(c)	 	Except as otherwise provided in this Lease, Tenant shall during the Term
maintain in good condition and repair at all times at its expense the Premises and

12

 

	 	 	 	the systems serving the Premises. Moreover, during the entire Term, Tenant must
keep the parking areas clean and in good condition and repair, water the landscape
plantings situated on the Land at suitable intervals, and maintain in force service
contracts providing for the routine repair and maintenance of the HVAC and other
Building systems serving the Premises (each, a Maintenance Contract). Promptly
after receipt thereof, Tenant shall furnish to Landlord a copy of each Maintenance
Contract (and each renewal thereof) and a copy of each service report received by
Tenant under any Maintenance Contract. Tenant’s obligations include necessary
replacements of the landscaping, parking areas, driveways, sidewalks, stairs,
elevators, loading dock, dock door, and leveler, and related facilities, and the
HVAC and other systems serving the Premises and all Tenant Improvements.

	 	(i)	 	With respect to any proposed replacement of any portion of the
HVAC system (HVAC Replacement) during the last two (2) years of the Initial
Term or any Renewal Term of this Lease:

	 	(A)	 	Tenant must give Landlord written notice of the
need for the HVAC Replacement at least 30 days prior to commencing the
HVAC Replacement, which notice must include:

	 	(I)	 	a detailed estimate from the
service provider under the Maintenance Contract for the HVAC
system of the cost to repair the HVAC system (or the applicable
part thereof) without replacing it; and
	 
	 	(II)	 	bids for the cost of the HVAC
Replacement from at least three (3) reputable HVAC providers
approved by Landlord; and

	 	(B)	 	Landlord must give its prior written consent to
the HVAC Replacement and the HVAC provider who will install the HVAC
Replacement, which consent may not be unreasonably withheld,
conditioned, or delayed.

	 	 	 	If Landlord does not consent to the HVAC Replacement within ten (10) days
after receipt of Tenant’s notice, and Tenant nevertheless proceeds with such
HVAC Replacement, then Tenant may elect to submit to binding arbitration as
provided in Section 41 below the question whether Tenant’s decision to
proceed with the HVAC Replacement rather than repairing the applicable
portion(s) of the HVAC system (HVAC Replacement Decision) was reasonable.
	 
	 	(ii)	 	If Landlord consents to an HVAC Replacement (or if Landlord
does not consent to the HVAC Replacement, Tenant elects to proceed with the
HVAC Replacement and to submit its HVAC Replacement Decision for arbitration
under Section 41, and the arbitrator decides in favor of Tenant) during the
last two (2) years of the Initial Term or any Renewal Term and Tenant does not
exercise its option for an available Renewal Term under Section 5, then, within
30 days after the expiration of the Term, Landlord shall reimburse Tenant an
amount determined by multiplying the

13

 

	 	 	 	out-of-pocket cost incurred by Tenant for the HVAC Replacement by a fraction
whose denominator is the useful life (Useful Life) of the HVAC Replacement,
as determined in accordance with generally accepted accounting principles
(stated in years), and whose numerator is the Useful Life minus the number
of full or partial years remaining in the Initial Term or Renewal Term, as
applicable, at the time such HVAC Replacement occurs (plus simple interest
on the portion of the HVAC Replacement for which Landlord is responsible at
the rate of eight percent (8%) per annum from the date that the HVAC
Replacement expense was incurred), subject to the following conditions:

	 	(A)	 	Tenant must have obtained and continued in
effect at all times during the Term a Maintenance Contract for the
HVAC;
	 
	 	(B)	 	Tenant must not be in default under this Lease
beyond any applicable notice and cure period at the time of
reimbursement;
	 
	 	(C)	 	Tenant must provide Landlord with copies of
paid receipts evidencing the payment of the costs for the HVAC
Replacement; and
	 
	 	(D)	 	Landlord may set off against its reimbursement
amount any outstanding amounts owed by Tenant to Landlord under this
Lease.

	 	 	 	E.G., if we assume that Tenant makes an HVAC Replacement at any time during
the last year of the Initial Term, Tenant is entitled to reimbursement under
this Subsection 8(c)(ii), the Useful Life is determined to be nine years,
and the cost of the HVAC Replacement is $500,000, then Landlord’s
reimbursement to Tenant will be $444,444 [$500,000 times 8/9], plus simple
interest at the rate of eight percent (8%) per annum on the portion of the
HVAC Replacement for which Landlord is responsible from the date that the
HVAC Replacement expense was incurred.
	 
	 	(iii)	 	If Landlord consents to an HVAC Replacement at any time during
the last two (2) years of the Initial Term or any Renewal Term (or if Landlord
does not consent to the HVAC Replacement, Tenant elects to proceed with the
HVAC Replacement and to submit its HVAC Replacement Decision for arbitration
under Section 41, and the arbitrator decides in favor of Tenant) and Tenant
thereafter exercises its Option for an available Renewal Term or Renewal Terms,
then at the expiration of the last of such exercised Renewal Terms, Landlord
shall reimburse Tenant an amount determined by multiplying the out-of-pocket
cost incurred by Tenant for the HVAC Replacement by a fraction whose
denominator is the Useful Life of the HVAC Replacement and whose numerator is
the Useful Life minus the number of full or partial years which have elapsed
since the time the HVAC Replacement occurred plus interest at the rate of eight
percent (8%) per annum on the portion of the HVAC Replacement for which
Landlord is responsible from the date that the HVAC Replacement expense was
incurred.

14

 

	 	(d)	 	At Tenant’s request, during the first Lease Year of the Term, Landlord agrees,
at no out of pocket cost to Landlord, to assist Tenant in obtaining and coordinate
maintenance providers for the Premises.
	 
	 	(e)	 	Landlord or Tenant, after providing the other party 30 days’ written notice,
may perform any obligation the other party (the Non-Performing Party) is required to
perform pursuant to this Section 8 but has failed to perform on behalf of such
Non-Performing Party, and the Non-Performing Party shall pay to the party performing
such obligation (the Performing Party) within 30 days after the date of the
Non-Performing Party’s receipt of the Performing Party’s invoice the full amount of the
reasonable costs and expenses the Performing Party incurs to perform such obligations,
together with the amount of any reasonable legal fees the Performing Party incurs in
instituting, prosecuting or defending any action or proceeding by reason of any default
in respect of any such obligation, except that the Performing Party shall have no right
to perform such obligation if such obligation requires more than 30 days to perform and
the Non-Performing Party has commenced performance of the obligation within the 30-day
period and is diligently pursuing performance of that obligation. The foregoing in no
way eliminates Landlord’s obligation to promptly perform repairs involving hazardous or
emergency situations, as further set forth in Section 8(b) above, and Tenant’s
corresponding right of self-help if Landlord fails to do so as more specifically
provided in Section 25(a) below.

Section 9. Utilities.

Tenant shall contract for and pay for all utilities and other services furnished to the
Premises commencing on the date Landlord substantially completes construction of the
Landlord Improvements.

Section 10. Satellite Dish.

Tenant has the right to use portions of the roof area of the Building, or such other
locations on the Land, as Tenant may reasonably select and Landlord approves (provided
Landlord’s approval shall not be unreasonably withheld, conditioned, or delayed) and as
Legal Requirements permit, for the installation, operation, maintenance, security, repair,
and replacement of antennae and satellite dishes serving the Premises and related cable
connections (the Telecommunications Equipment), as well as for access to risers. Tenant’s
use of the Premises in respect to the Telecommunications Equipment is subject to such
reasonable rules as Landlord may from time to time designate and to the following additional
conditions: (i) Tenant is solely responsible for the installation, maintenance, repair,
operation, and replacement of the Telecommunications Equipment, (ii) Tenant must install
screening around the Telecommunications Equipment to the extent required by Legal
Requirements, and (iii) any roof penetrations necessary to install the Telecommunications
Equipment shall be made so as not to invalidate or void the roof warranty including using
designated contractors, if required as a condition of such compliance with the roof
warranty. On or before the Expiration Date or within 30 days after the earlier termination
of this Lease, Tenant shall remove the Telecommunications Equipment and repair any damage to
the Premises that the removal causes. Tenant shall pay Landlord within 30 days after
Landlord’s demand the cost of repairing any damage to the Premises arising from the removal
and restoration.

15

 

Section 11. Signs and Flagpoles.

Tenant has the exclusive right to place exterior signs and flagpoles on the Premises
subject only to any restrictions applicable by virtue of Legal Requirements, other than
temporary for sale or for rent signs installed by Landlord. Tenant shall maintain its signs
in good condition and shall remove them and repair any damage to the Premises the removal
causes on or before the Expiration Date or within 30 days after any earlier termination of
this Lease.

Section 12. Expansion Option.

	 	(a)	 	Subject to Section 12(b), if (i) Tenant is not in default beyond all applicable
grace, notice and cure periods in respect of the performance of its obligations arising
under the terms of this Lease, (ii) this Lease is in full force and effect in
accordance with its terms, (iii) the Initial Term has not been terminated, (iv) the
total stockholder equity of Guarantor (as defined in Section 38) is not less than $500
Million, and (v) its ratio of current assets to current liabilities is not less than
1.0 (taking into account available proceeds under any credit facility in place at the
time in question), then Tenant has the option (the Expansion Option) to lease an
addition to the Building (the Expansion) that Landlord will erect in order to enlarge
the floor area of the Building. For purposes of calculating the Guarantor’s total
stockholder equity and current ratio, its most recent published annual report or 10Q on
file with the Securities and Exchange Commission shall be used.
	 
	 	(b)	 	If Tenant exercises the Expansion Option during the first Lease Year, the
Expansion must be for at least 20,000 rentable square feet, the Annual Base Rent for
the Expansion will be the same as the Annual Base Rent (on a per square foot basis) for
the initial Premises, the term for the Expansion shall end conterminously with the term
of the lease for the Initial Premises and all other terms of this Lease will remain the
same.
	 
	 	(c)	 	If Tenant exercises the Expansion Option after the first Lease Year, the
initial Term for the initial Premises will automatically be extended so that the
initial Term with respect to the initial Premises and the Expansion are coterminous and
last for 12 years from the Expansion Commencement Date (as defined below). Other than
the Base Rent, the terms of this Lease with respect to the initial Premises during the
balance of the 12-year term will remain as stated in this Lease. The Base Rent payable
by Tenant with respect to the initial Premises will remain in effect until the
Expiration Date for the Expansion, with the Annual Base Rent increasing by 6.12% on the
first day of the 13th Lease Year (based in the initial Term) and on the
first day of each succeeding fourth Lease Year (i.e., 16th, 20th,
etc.).
	 
	 	(d)	 	If Tenant exercises the Expansion Option for an Expansion which would exceed
25,000 rentable square feet, then:

	 	(i)	 	Landlord is not required to construct any Expansion if (x) the
size of the Expansion would cause the expanded Premises not to comply with all
applicable laws, ordinances, and codes, including, without limitation, parking
code requirements, or (y) the expanded Premises is not, in

16

 

	 	 	 	Landlord’s sole opinion, marketable to a replacement tenant or tenants. If
this Subsection 12(d)(i) is applicable, then Landlord shall promptly so
notify Tenant. Notwithstanding the foregoing, if Landlord notifies Tenant
that Subsection 12(d)(i)(y) is applicable, then Tenant may notify Landlord
within 10 business days after receipt of Landlord’s notice that Tenant
elects to reduce the size of the Expansion to 25,000 rentable square feet or
less and Landlord will proceed with the construction of the Expansion under
this Section 12.
	 
	 	(ii)	 	If Subsection 12 (d)(i) is not applicable, then Landlord shall
notify Tenant of the parking ratio which it will provide for such Expansion and
the overall parking ratio for the Building, as expanded; and Tenant may elect
to reduce the size of such Expansion after review of such parking ratios.

	 	(e)	 	If Tenant exercises the Expansion Option by giving written notice of exercise
to Landlord, then, subject to Subsection 12(d)(i):

	 	(i)	 	The parties will promptly enter in good faith into an agreement
whereby (x) Landlord agrees to construct the Expansion within 12 months or less
after the execution of such agreement, (y) the parties agree to increase the
Base Rent for the Expansion in the manner as set forth in this Section 12,
payable during the period from the date Landlord substantially completes
construction of the Expansion (the Expansion Commencement Date) and that ends
at 11:59 p.m. (Dallas, Texas local time) on either the day prior to the 12th
anniversary of the Expansion Commencement Date, if the Expansion Commencement
Date occurs on the first day of a calendar month, or on the day prior to the
12th anniversary of the first day of the first full month following the
calendar month in which the Expansion Commencement Date occurs, if the
Expansion Commencement Date does not occur on the first day of a month,
whichever is applicable (the Expansion Term).
	 
	 	(ii)	 	Landlord shall construct the Expansion on the same terms as for
the construction of the Landlord Improvements (except for Base Rent as
specified in this Section 12), granting Tenant the same Tenant Allowances
included in this transaction (on a per rentable square foot basis), except as
otherwise specified in Exhibit D.
	 
	 	(iii)	 	If Tenant exercises the Expansion after the first Lease Year,
the Base Rent for the Expansion will be the amount determined by multiplying
the Expansion Construction Costs by the sum of (A) the interest rate on 10-year
U.S. Treasury Bills as of the Expansion Commencement Date plus (B) 400 basis
points. Within 30 days following Landlord’s substantial completion of the
construction of the Expansion, Landlord shall furnish to Tenant a detailed
itemization of the costs by major construction trade (the Expansion
Construction Costs) that Landlord incurred in connection with the design and
construction of the Expansion and copies of invoices, statements, contracts,
subcontracts, and other information that Tenant may reasonably request in order
to confirm the accuracy of Landlord’s itemization.

17

 

	 	(iv)	 	Landlord shall construct the Expansion in accordance with the
Outline Specifications and as specified in Section 2 for the initial Building.
Landlord shall solicit bids from at least three contractors appearing on a list
of contractors jointly developed and mutually approved by the parties.
Landlord shall award the contract for the construction of the Expansion to the
lowest qualified bidder, subject to Tenant’s approval, which will not be
unreasonably withheld, conditioned, or delayed. Within sixty (60) days after
Tenant exercises the Expansion Option, Landlord shall provide Tenant with an
estimate of the Expansion Construction Costs and a proposed construction
schedule. If Tenant determines in its sole discretion that the cost to
construct the Expansion is too high, or that the construction schedule is
unacceptable, Tenant may elect to nullify its election to exercise the
Expansion at any time prior to Tenant’s written approval of the construction
budget for the Expansion. If, within sixty (60) days after the estimate of
Expansion Construction Costs and the construction schedule has been received by
Tenant, Tenant fails either to approve the estimate of the Expansion
Construction Costs and the construction schedule or to commence discussions
with the Landlord to value engineer the estimate of Expansion Construction
Costs and/or to refine the construction schedule, then Tenant shall be deemed
to have nullified its election to exercise the Expansion Option.
	 
	 	(v)	 	On or about the date that Landlord substantially completes the
construction of the Expansion, Landlord will cause its architect to determine
the rentable square footage of the Expansion (in accordance with BOMA ANSI
Z65.1-1996, for a single tenant building), and the parties will promptly
execute and deliver an amendment to this Lease that confirms the addition of
the Expansion to the Premises, the Expansion Commencement Date, and the Base
Rent that will be payable through the Expiration Date with respect to the
Expansion and the initial Premises.
	 
	 	(vi)	 	As a condition precedent to Landlord’s obligation to construct
the Expansion, Guarantor shall confirm in writing to Landlord that its Lease
Guaranty, attached hereto as Exhibit I, applies to Tenant’s lease
obligations for the Expansion Premises pursuant to the Expansion Agreement (as
such terms are hereinafter defined).
	 
	 	(vii)	 	Landlord shall cause the Expansion to be constructed and
substantially completed and the Expansion premises (the Expansion Premises) to
be delivered to Tenant in broom clean condition in accordance with all
applicable laws on or before three hundred sixty five (365) days from the
execution and delivery of the agreement described in Section 12(d) (the
Expansion Agreement). If substantial completion and tender of possession of
the Expansion Premises to Tenant does not occur by the following dates, each of
which is subject to extension by one day for each day of Excused Delays, but
not more than one hundred eighty (180) days in the aggregate for all Excused
Delays, other than days of Tenant Delay which shall not be so limited):

	 	(A)	 	365 days from the execution of the Expansion
Amendment, then commencing on the Expansion Commencement Date Tenant
will

18

 

	 	 	 	receive one day of free Base Rent (for the Expansion Premises only)
for each day of delay through the 425th day after the
execution of the Expansion Amendment.
	 
	 	(B)	 	the 426th day after the execution of
the Expansion Amendment, then commencing on the Expansion Commencement
Date Tenant will receive three days of free Base Rent (for the
Expansion Premises only) for each day of delay thereafter; and
	 
	 	(C)	 	the 445th day after the execution of
the Expansion Amendment, then Tenant may, at its option by giving
notice to Landlord at any time thereafter until Landlord substantially
completes the Expansion Premises, elect to take over completion of the
Expansion in which event Tenant shall be entitled to a credit against
Base Rent for all reasonable costs incurred by Tenant in completing the
Expansion.

	 	(f)	 	In lieu of exercising the Expansion Option, Tenant may, at its sole cost and
expense, elect to construct an Expansion. If Tenant elects to construct an Expansion,
then:

	 	(i)	 	The design and construction plans for the Expansion shall be
subject to Landlord’s approval, not to be unreasonably withheld.
	 
	 	(ii)	 	Tenant shall cause the Expansion to be constructed in a good
and workmanlike manner and in accordance with all applicable laws and the
approved plans. Subsections 2(n),(o) and (p) of this Lease shall apply to the
construction of the Expansion by Tenant or its contractor(s).
	 
	 	(iii)	 	On or about the date that Tenant substantially completes the
construction of the Expansion, Landlord will cause its architect to determine
the rentable square footage of the expansion (in accordance with BOMA ANSI
265.1-1996 for a single tenant building).
	 
	 	(iv)	 	The term of the Lease shall not be extended.
	 
	 	(v)	 	Base Rent shall not be increased.
	 
	 	(vi)	 	Tenant shall modify its property insurance to include builder’s
risk insurance as reasonably required by Landlord.

	 	(g)	 	Upon completion and acceptance by Tenant of same, the Expansion Premises shall
be deemed to be part of the Building and the Premises, and shall be owned by the
Landlord.

Section 13. Landlord’s Right of Access.

	 	(a)	 	Landlord and its authorized representatives have the right to enter the
Premises during Tenant’s regular business hours for the purpose of (i) determining
whether the Premises are in good condition and whether Tenant is complying with its
obligations arising under the terms of this Lease, and (ii) performing any

19

 

	 	 	 	maintenance or repairs for which Landlord is responsible under the terms of this
Lease. Landlord has the right to enter the Premises at all times without notice in
the event of an emergency or for the purpose of making emergency repairs; under
other circumstances, Landlord must give Tenant written notice of Landlord’s intended
entry at least 48 hours in advance of that entry.
	 
	 	(b)	 	Landlord shall conduct its activities in the Premises in a manner that will
cause a minimum of interference with Tenant’s business operations.

Section 14. Tenant’s Indemnity.

Except as provided in Section 17, Tenant shall indemnify, defend, and hold Landlord
harmless from and against all claims, actions, demands, judgments, damages, liabilities and
expenses, including reasonable legal fees, that may be asserted against Landlord or that
Landlord may sustain by virtue of the occurrence of the death of or bodily injury to any
person or the loss of, damage to, or destruction of, any property arising from Tenant’s use
of the Premises or from the negligent or intentional acts or omissions of Tenant, or any of
its representatives, agents, employees, contractors or invitees, including, without
limitation, any tenant delays or any failure by tenant to perform its maintenance
obligations under section 8(c) or any damage to any structural components caused by
tenant, its contractors, agents, employees or representatives that increase the landlord’s
cost of performing its obligations under section 8(a), except to the extent the
claims, actions, demands, judgments, damages, liabilities or expenses arise from the
intentional or negligent acts or omissions of Landlord or any of its representatives,
agents, employees, contractors or invitees. Tenant’s obligations under this Section 14
apply regardless whether Landlord was concurrently negligent (whether active or passive), it
being agreed by the parties that in the even of concurrent negligence Tenant’s respective
liability will be determined in accordance with principles of comparative negligence.

Section 15. Landlord’s Indemnity.

Except as provided in Section 17, Landlord shall indemnify, defend, and hold Tenant
harmless from and against all claims, actions, demands, judgments, damages, liabilities and
expenses, including reasonable legal fees, that may be asserted against Tenant or that
Tenant may sustain by virtue of the occurrence of the death of or bodily injury to any
person or the loss of, damage to, or destruction of any property arising in connection with
any latent or patent defect in the condition of the Premises existing as of the Commencement
Date, or arising from the negligent or intentional acts or omissions of Landlord, or any of
its representatives, agents, employees, contractors or invitees, except to the extent any
such claims, actions, demands, judgments, damages, liabilities or expenses arise from the
intentional or negligent acts or omissions of Tenant or any of its representatives, agents,
employees, contractors or invitees. Landlord’s obligations under this Section 15 apply
regardless whether Tenant was concurrently negligent (whether active or passive), it being
agreed by the parties that in the even of concurrent negligence Landlord’s respective
liability will be determined in accordance with principles of comparative negligence.

20

 

Section 16. Insurance.

	 	(a)	 	Commencing on the date (the Insurance Commencement Date) which is the latter of
(i) Substantial Completion and (ii) delivery of the Landlord Improvements to Tenant,
and continuing for the balance of the Term, Tenant shall provide and maintain a
“special form” insurance policy (including fire and standard extended coverage perils,
leakage from fire protective devices and other water damage) covering loss or damage to
the Landlord Improvements and the Tenant Improvements (including, without limitation,
the Expansion Premises and any alterations made to the Premises from time to time) on a
full replacement cost basis, excluding excavations, footings and foundations and
providing for a deductible of no greater than $100,000.00; provided, while Tenant is
constructing the Tenant Improvements, the policy must include builder’s risk coverage
on a completed value basis. In the event of a casualty, Tenant shall pay to Landlord
the lesser of the amount of the deductible or the full amount of the loss in the case
of a loss in an amount less than the deductible, which payment shall be treated in the
same manner as insurance proceeds. Tenant shall provide and maintain throughout the
Term, at its expense, such property insurance covering Tenant’s machinery, equipment,
furniture, fixtures, personal property (including also property under the care,
custody, or control of Tenant) and business interests which may be located in, upon or
about the Premises in such amounts as Tenant may from time to time deem prudent.
Tenant shall cause all such property policies to permit Tenant’s waiver of claims
against Landlord under Section 17 for matters covered thereby. Tenant shall cause
Landlord and its lender holding a first lien against the Premises (if Landlord has
notified Tenant of the name and address of its lender) to be named as additional
insureds, as their interests may appear, and shall cause the coverage to continue for
Landlord’s benefit notwithstanding any act or omission on Tenant’s part.
	 
	 	(b)	 	Commencing on the Insurance Commencement Date and continuing for the balance of
the term, Tenant shall provide and maintain the following insurance, in the amounts
specified below:

	 	(i)	 	bodily injury and property damage liability insurance, with a
combined single occurrence limit of not less than $5,000,000.00; such insurance
will be on a commercial general liability form including, without limitation,
personal injury and assumed contractual liability for the performance by Tenant
of the indemnity agreements set forth in Section 14; Tenant shall cause
Landlord and its lender to be named as an additional insureds under such
liability insurance and shall cause such coverage to include cross liability
and severability of interests clauses and, unless otherwise approved in writing
by Landlord, to have a deductible of $25,000.00 or less and no retention or
self-insurance provision;
	 
	 	(ii)	 	worker’s compensation insurance insuring against and satisfying
Tenant’s obligations and liabilities under the worker’s compensation laws of
the Sate of Texas and employers’ liability insurance in the limit of
$100,000/500,000/100,000 (provided that Tenant may self-insure this obligation
pursuant to a program of self-insurance); and

21

 

	 	(iii)	 	if Tenant operates owned, hired or nonowned vehicles on the
Premises, comprehensive automobile liability will be carried at a limit of
liability not less than $1,000,000.00 combined bodily injury and property
damage.

	 	(c)	 	All insurance required to be maintained by Tenant pursuant to this Section 16
must be maintained with insurers licensed to do business in the State of Texas and
having a Best’s Key Rating of at least A-:IX. Tenant shall provide to Landlord, on or
before the Insurance Commencement Date and at least 10 days before the expiration date
of expiring policies, such copies of either current policies or certificates as many be
reasonably required to establish that the insurance coverage required by this Section
16 is in effect from time to time and that the insurer(s) have agreed to give the other
party at least 30 days notice prior to any cancellation of, or material modification
to, the required coverage. Landlord and Tenant shall cooperate with each other in the
collection of any insurance proceeds which may be payable in the event of any loss,
including the execution and delivery of any proof of loss or other actions required to
effect recovery. Tenant shall cause all commercial general liability and property
policies maintained by Tenant to be written as primary policies, not contributing with
and not supplemental to any coverage that Landlord may carry.
	 
	 	(d)	 	Tenant may provide the insurance required by virtue of the terms of this Lease
by means of a combination of primary and excess or umbrella coverage and by means of a
policy or policies of blanket insurance so long as (i) the amount of the total
insurance allocated to the Premises under the terms of the blanket policy or policies
furnishes protection equivalent to that of separate policies in the amounts required by
the terms of this Lease, and (ii) the blanket policy or policies comply in all other
respects with the other requirements of this Lease.
	 
	 	(e)	 	If Tenant fails to obtain the insurance coverage, as set forth in this Section
16 and does not cure its failure within 10 days after written notice from Landlord,
Landlord may, at its option, obtain such insurance for Tenant, and Tenant shall pay, as
additional rent, the reasonable cost thereof.

Section 17. Waiver of Subrogation.

Any provision of this Lease to the contrary notwithstanding, Landlord and Tenant waive
and release the other from any and all liability or responsibility to the other or anyone
claiming through or under them by way of subrogation or otherwise from any and all liability
for any loss or damage to the property of the releasing party to the extent that the
releasing party’s loss or damage is coverable under commercially available all risk property
insurance policies, even if the loss or damage or legal liability is caused by or
results from the fault or negligence of the other party or anyone for whom the other party
may be responsible and even if the releasing party is self-insured or the amount of the
releasing party’s insurance is inadequate to cover the loss or damage or legal
liability. It is the intention of the parties that Landlord and Tenant will each look
solely to their respective insurance carriers for recovery against any such loss or damage
or legal liability, without its insurance carriers having any rights or subrogation against
the other party.

22

 

Section 18. Casualty.

	 	(a)	 	If damage caused by a fire or other casualty renders the Building fully or
partially untenantable, neither the Base Rent nor any other amounts payable under this
Lease will abate for the period during which the Building is wholly or partially
untenantable. Tenant shall cause its insurance carriers to pay to Landlord all
insurance proceeds for the Landlord Improvements and the Tenant Improvements.
	 
	 	(b)	 	If a fire or other casualty renders the Premises untenantable, in whole or in
part, and the estimated time for the restoration of the Landlord Improvements and the
Tenant Improvements exceeds the period that will expire on the date that is 270 days
after the date of the occurrence of the fire or casualty, Tenant may terminate this
Lease by the delivery of written notice to Landlord within 15 days following the date
on which Landlord notifies Tenant of the estimated time for the restoration of the
Landlord Improvements and the Tenant Improvements. Landlord must provide that estimate
within 60 days following the date of the casualty. If a termination of this Lease does
not occur in accordance with the foregoing provisions of this Section 18(b), but
Landlord fails to complete the restoration of the Landlord Improvements and the Tenant
Improvements by the date that is 60 days after the date of the expiration of the period
within which Landlord estimated the restoration would be completed, Tenant may,
notwithstanding anything in this Lease to the contrary, terminate this Lease by the
delivery of written notice to Landlord at any time following the expiration of that
60-day period, but prior to the date on which Landlord completes the restoration of the
Landlord Improvements and the Tenant Improvements. If a termination of this Lease
occurs in accordance with the terms of this Section 18, then Tenant shall cause its
insurance carriers to pay to Landlord all proceeds payable in respect of the insurance
that Tenant maintains in accordance with the terms of Section 16(a) allocable to the
Landlord Improvements and the Tenant Improvements to the extent not previously
disbursed to Landlord in connection with the restoration of the Landlord Improvements
and the Tenant Improvements. Excusable Delays shall not extend any of the time periods
set forth in this Section 18(b) for more than one hundred eighty (180) days in the
aggregate.
	 
	 	(c)	 	If fire or other casualty damages the Premises and a termination of this Lease
does not occur, so long as Tenant is not in default beyond all applicable grace, notice
and cure periods under the terms of this Lease, Landlord shall restore the Landlord
Improvements and the Tenant Improvements to substantially the condition that existed
prior to the occurrence of the fire or other casualty; provided, however, that with
respect to the Tenant Improvements, Landlord shall only be obligated to restore the
Tenant Improvements to the condition reflected in the most recent as-built plans for
the Tenant Improvements in Landlord’s possession, unless the casualty occurs prior to
completion of the Tenant Improvements, in which event, Landlord shall restore the
Tenant Improvements in substantial accordance with the Final Tenant Improvements Plans
and Specifications. Landlord and Tenant shall each pursue such restoration with
diligence and continuity upon and subject to receipt of the insurance proceeds with the
understanding that Tenant shall cause its insurance carriers to pay to Landlord
disbursements of the proceeds payable in respect of the insurance Tenant maintains in
accordance with the terms of Section 16(a) above as

23

 

restoration progresses in order to reimburse Landlord for the costs Landlord
reasonably incurs in connection with the restoration of the Landlord Improvements
and the Tenant Improvements. In completing the restoration, Landlord and Tenant
shall each comply with all applicable Legal Requirements. In performing their
respective restoration obligations, Landlord and Tenant must each restore their
respective portions of the Premises so that they comply with Legal Requirements
applicable at the time of the restoration and not just the Legal Requirements that
were applicable at the time of original construction of the Premises. If the
aggregate amount of those insurance proceeds allocable to the Landlord Improvements
and the Tenant Improvements exceeds the aggregate amount of the costs Landlord
reasonably incurs in connection with the restoration of the Landlord Improvements
and the Tenant Improvements, Tenant is entitled to the excess. Tenant is
responsible for any excess costs incurred by Landlord in restoring the Landlord
Improvements and the Tenant Improvements.

Section 19. Condemnation.

	 	(a)	 	If any part of the Premises is taken for public use by condemnation, eminent
domain or other similar action and the taking materially and adversely affects Tenant’s
operations in the Building, Tenant may immediately terminate this Lease by delivering
notice to Landlord.
	 
	 	(b)	 	If any part of the Premises is taken and Tenant does not terminate this Lease,
Base Rent and additional rent required by virtue of Section 4(g) will abate for the
balance of the Term in proportion to the diminished utility of the Premises in the
conduct of Tenant’s business taken, and Landlord shall restore the remainder of the
Premises at its expense as necessary to render them suitable for Tenant’s use, so long
as Tenant is not in default under the terms of this Lease beyond all applicable grace,
notice and cure periods.
	 
	 	(c)	 	All condemnation awards made with respect to Landlord’s reversionary and
leasehold interests in the Premises will be the exclusive property of Landlord, but
Tenant reserves the right to bring an action in its own name for its loss of business
and moving expenses, as well as any other damages that Tenant may recover as a result
of the condemnation action, provided such action does not reduce the amount of the
award otherwise recoverable from the condemning authority by Landlord.

Section 20. Compliance with Environmental Laws.

	 	(a)	 	Landlord warrants and represents to Tenant that, to Landlord’s knowledge, the
Land and the Landlord Improvements are, and covenants that upon the Commencement Date
will be, in full compliance with all applicable environmental laws, rules,
requirements, orders, directives, ordinances and regulations of the United States of
America or any state, city or municipal government or other lawful authority having
jurisdiction over the Premises (collectively Environmental Laws). If there is an
Environmental Report, Landlord shall deliver a copy thereof to Tenant. Except as set
forth in Section 20(c), Landlord shall take at its expense all action necessary,
including all remediation and clean up work, to ensure that the Premises comply at all
times with all Environmental Laws and that the Premises are safe for use and occupancy
at all times.

24

 

	 	(b)	 	Except as set forth in Section 20(c), Landlord shall defend, indemnify and save
Tenant and its directors, officers, agents, employees and contractors harmless from and
against all claims, obligations, demands, actions, proceedings, judgments, losses,
damages, liabilities, fines, penalties and expenses (including, without limitation,
sums paid on settlement of claims, reasonable legal fees, and reasonable consultant and
expert fees and expenses) that any one or more of them may sustain in connection with
any failure of the Landlord Improvements to comply with Environmental Laws or in
connection with any environmental condition affecting the Premises not caused by
Tenant’s use and occupancy of the Premises or the construction and maintenance of the
Tenant Improvements.
	 
	 	(c)	 	Except as provided in Sections 20(a) and 20(b) above, Tenant shall timely
comply at its cost and expense with all rules, requirements, orders, directives,
ordinances and regulations applicable to Tenant’s use and occupancy of the Premises or
the construction and maintenance of the Tenant Improvements, including, without
limitation, the Environmental Laws, and shall defend, indemnify and hold Landlord and
its partners and their respective members, directors, officers, agents, employees, and
contractors harmless from and against all claims, obligations, demands, actions,
proceedings, judgments, losses, damages, liabilities, fines, penalties and expenses
(including, without limitation, sums paid on settlement of claims, reasonable legal
fees, and reasonable consultant and expert fees and expenses) that any one or more of
them may sustain by virtue of any environmental condition that Tenant’s use and
occupancy of the Premises or the construction and maintenance of the Tenant
Improvements causes and the continued existence of which violates the Environmental
Laws.
	 
	 	(d)	 	Notwithstanding the foregoing apparently to the contrary, if any environmental
condition encompassed within this Section 20 and not attributable to Tenant’s use and
occupancy of the Premises or the construction and maintenance of the Tenant
Improvements is not susceptible to being corrected within 180 days after the date of
its discovery or if Landlord fails within 180 days after the date of its discovery to
correct a condition that is susceptible to being corrected within that period of time,
Tenant may terminate this Lease by the delivery of written notice to Landlord at least
30 days in advance of the effective date of termination specified in that notice.
Further, if the correction of any environmental condition not attributable to Tenant’s
use and occupancy of the Premises or the construction and maintenance of the Tenant
Improvements partially or totally impairs Tenant’s use of the Premises, Tenant’s
obligation to pay Base Rent will abate during the period the corrective activity takes
place in proportion to the diminished utility of the Premises in the conduct of
Tenant’s business.
	 
	 	(e)	 	The indemnities of Landlord and Tenant contained in this Section 20 will not
extend to loss of business, lost rentals, diminution in property value, or incidental,
indirect or consequential damages.
	 
	 	(f)	 	The provisions of this Section 20 survive the expiration of the Term or the
earlier termination of this Lease.
	 
	 	(g)	 	Tenant shall not cause or permit any Hazardous Substances, as defined below to
be brought upon, kept or used in or about the Premises or the Building, without

25

 

	 	 	 	the prior written consent of Landlord, which consent is in Landlord’s sole
discretion; but Landlord’s consent is not required for the use at the Building of
cleaning supplies, toner for photocopying machines, and other similar materials, in
containers and quantities reasonably necessary for and consistent with normal
ordinary use by Tenant at the Building.

	 	(h)	 	Hazardous Substance(s) shall mean any and all substances (whether solid, liquid
or gas) defined, listed, or otherwise classified as pollutants, hazardous wastes,
hazardous substances, hazardous materials, extremely hazardous wastes, or words of
similar meaning or regulatory effect under any present Environmental Laws or that have
a negative impact on human health or the environment, including but not limited to
petroleum and petroleum products, asbestos and asbestos-containing materials,
polychlorinated biphenyls, lead, radon, radioactive materials, flammables and
explosives.

Section 21. Compliance with Public Accommodation Laws.

	 	(a)	 	Landlord warrants that, when constructed, the Landlord Improvements will comply
with all applicable laws, regulations, and building codes governing nondiscrimination
in commercial facilities (Public Accommodation Laws), including, without limitation,
the requirements of the Americans with Disabilities Act (42 U.S.C. § 12101) and all
rules and regulations made on the basis of authority granted in that Act, and covenants
that the portions of the Landlord Improvements Landlord is required to maintain under
Section 8(a) will remain in compliance with all Public Accommodation Laws throughout
the Term.
	 
	 	(b)	 	Tenant warrants that, when constructed, the Tenant Improvements will comply
with all Public Accommodation Laws, and covenants that the Tenant Improvements and all
portions of the Landlord Improvements Tenant is required to maintain under Section 8(c)
will remain in compliance with all Public Accommodation Laws throughout the Term.
	 
	 	(c)	 	Landlord shall promptly complete any and all alterations, modifications or the
Landlord Improvements, including, without limitation, remodeling, renovation,
rehabilitation, reconstruction, changes or rearrangements in structure and changes or
rearrangements in wall configuration or full-height partitions, that are or become
necessary with respect to the Landlord Improvements in order to comply with all Public
Accommodation Laws. Tenant shall promptly complete any and all alterations,
modifications or the Tenant Improvements, including, without limitation, remodeling,
renovation, rehabilitation, reconstruction, changes or rearrangements in structure and
changes or rearrangements in wall configuration or full-height partitions, that are or
become necessary in order to comply with all Public Accommodation Laws with respect (i)
to the Tenant Improvements for any reason or (ii) to the Premises solely because of
Tenant’s particular use of the Premises.
	 
	 	(d)	 	Landlord shall use commercially reasonable efforts to accomplish any and all
alterations, modifications or improvements undertaken in accordance with this Section
21 in a manner that will not substantially interfere with Tenant’s use or possession of
the Premises.

26

 

Section 22. Landlord’s Warranties.

     Landlord represents and warrants that:

	 	(a)	 	Landlord does not have knowledge of any pending condemnation or similar
proceeding affecting any part of the Premises.
	 
	 	(b)	 	Landlord does not have knowledge of any legal actions, suits, or other legal or
administrative proceedings that are now pending or threatened against either Landlord
or the Premises.
	 
	 	(c)	 	Landlord has neither granted any leases or occupancy licenses nor created any
tenancies affecting the Premises and there are no parties in possession of any portion
of the Premises as trespassers or otherwise.
	 
	 	(d)	 	The Premises have legal access to Regent Boulevard, subject to applicable laws
and ordinances; the Premises shall have not less than two curb cuts onto Regent
Boulevard.
	 
	 	(e)	 	Landlord does not have knowledge of any pending or threatened governmental or
private proceedings that would impair or result in the termination of access from the
Premises to abutting public highways, streets, and roads.
	 
	 	(f)	 	There is presently in existence or available water, electrical, sanitary sewer
and gas utility service for the Premises.
	 
	 	(g)	 	Landlord does not have knowledge, except as disclosed in the Environmental
Report, that: (A) there are any environmental hazards or defects affecting the Land,
(B) there are any polychlorinated biphenyls (PCBs) or substances containing PCBs on the
Land; (C) the Land is now or has been the site of any place of business engaged in
operations that involve the generation, manufacture, refining, transportation,
treatment, storage, handling or disposal or release of hazardous or toxic substances,
material or wastes on-site, whether above or below ground; and (D) there are any
above-ground or underground storage tanks located on the Land.
	 
	 	(h)	 	Except as reflected in the Environmental Report, Landlord knows of no releases
of, or the presence of, any hazardous or toxic material, substance or waste on or about
the Land.
	 
	 	(i)	 	Landlord has full right and lawful authority to enter into and perform the
Landlord’s obligations under this Lease for the full term hereof and has good and
indefeasible title to Land in fee simple, free and clear of all contracts, leases,
tenancies, agreements, easements, restrictions upon use or occupancy or other
restrictions, violations, mortgages and other liens, encumbrances or exceptions to
title of any nature whatsoever affecting the Land, except for the matters specifically
set forth on Exhibit K hereto;
	 
	 	(j)	 	the Land is zoned in conformity with applicable laws in a manner permitting the
use of the facilities constructed thereon for the Intended Use; and

27

 

	 	(k)	 	this Lease is not and shall not be subject or subordinate to any mortgage not
listed on Exhibit K hereto except for such subordination as may be accomplished
in accordance with the provisions of Section 22 of this Lease captioned
“Subordination, Attornment and Non-Disturbance.”

For purposes of this Section 22, the phrase “Landlord’s knowledge” and similar phrases
mean the current, actual knowledge of the individuals listed on Exhibit F attached
to this Lease.

Section 23. Tenant’s Default.

The occurrence of any one or more of the following events (Event(s) of Default) will
constitute a default and breach of this Lease by Tenant:

	 	(a)	 	Tenant’s failure to pay any Base Rent or additional rent (including, without
limitation, the Impositions) when due and the continuance of that failure for more than
10 days after the date on which Landlord gives Tenant written notice of the
delinquency;
	 
	 	(b)	 	Tenant’s failure to observe or perform any of the covenants, conditions or
provisions of this Lease that Tenant must observe or perform, other than the payment of
Base Rent or additional rent (excluding Tenant’s obligation to maintain the insurance
required pursuant to Section 16), where the failure continues for a period of 30 days
after Tenant’s receipt of written notice from Landlord; but if the nature of the
obligation that Tenant has failed to perform is such that more than 30 days are
reasonably required for its rectification, then an Event of Default will not occur so
long as Tenant commences the rectification within the initial 30-day period and
diligently and continuously prosecutes the rectification to completion; or
	 
	 	(c)	 	the making by Tenant of any general assignment or general arrangement for the
benefit of its creditors; the filing by or against Tenant of a petition seeking relief
under any law relating to bankruptcy (unless, in the case of a petition filed against
Tenant, Tenant causes the petition to be dismissed within 60 days after the date of its
filing); the appointment of a trustee or a receiver to take possession of substantially
all of Tenant’s assets located in the Premises or of Tenant’s interest in this Lease,
where possession is not restored to Tenant within 60 days after the date of the
appointment; or the attachment, execution or other judicial seizure of substantially
all of Tenant’s assets located in the Premises or of Tenant’s interest in this Lease
unless Tenant causes the seizure to be discharged within 60 days after the date of the
initiation of the seizure.

Section 24. Landlord’s Remedies.

At any time after the occurrence of an Event of Default, with or without additional
notice or demand, Landlord may do one of the following:

	 	(a)	 	terminate Tenant’s right to possession of the Premises and repossess the
Premises by any lawful means without terminating this Lease. In that event, Landlord
shall, to the extent required by applicable laws, use reasonably prompt efforts to
re-let the Premises for the account of Tenant for such rent and upon

28

 

	 	 	 	such terms as may be satisfactory to Landlord in its sole discretion. For the
purposes of that re-letting, Landlord may repair, remodel, or alter the Premises.
If Landlord fails to re-let the Premises, then Tenant shall pay to Landlord the Base
Rent and additional rent reserved in this Lease for the balance of the Term as those
amounts become due in accordance with the terms of this Lease. If Landlord re-lets
the Premises but fails to realize a sufficient sum from the re-letting to pay the
full amount of Base Rent and additional rent reserved in this Lease for the balance
of the Term as those amounts become due in accordance with the terms of this Lease,
then Tenant shall pay to Landlord the amount of any deficiency within 30 days of
Tenant’s receipt of Landlord’s demand;

	 	(b)	 	terminate this Lease and repossess the Premises by any lawful means. In that
event, Landlord may recover from Tenant as damages (i) all Base Rent and additional
rent (plus the cost necessary to satisfy Tenant’s obligation to maintain and insure the
Premises, as set forth under Sections 8 and 16, respectively, of this Lease) that
became due prior to the termination and that remains unpaid, (ii) the discounted
present value (determined based on then commercially reasonable rates) of the amount,
if any, by which (I) the Base Rent reserved under the terms of this Lease for the
balance of the Term that remained as of the effective date of the termination exceeds
(II) the fair market rent (but not less than the amount for which the Premises has been
relet) for the Premises for the balance of the Term after deduction of all anticipated
reasonable expenses of re-letting for that period, and (iii) all reasonable costs and
expenses Landlord reasonably incurs in connection with the enforcement of Tenant’s
obligation to pay those damages, including, without limitation, reasonable legal fees.
If the amount described in clause (II) above exceeds the amount described in clause (I)
above, then Landlord has no obligation to pay Tenant any part of the excess or to
credit any part of the excess against any other sums or damages for which Tenant may be
liable to Landlord at the time of the termination; or
	 
	 	(c)	 	pursue any other remedy available to Landlord under the laws of the State in
which the Premises are located; provided, however, that Landlord waives any existing or
hereinafter enacted statutory lien in Tenant’s personal property (which does not
include the Tenant Improvements) located at or about the Premises.

Section 25. Landlord’s Default and Tenant’s Remedies.

	 	(a)	 	If Landlord defaults in the performance of any of Landlord’s obligations set
forth in this Lease, and if (i) Landlord’s default creates or increases the risk of
imminent danger of bodily injury to or death of persons or damage to or destruction of
property, including, without limitation, the Building or Tenant’s property, and either
Landlord does not commence the rectification of its default promptly upon Tenant’s
delivery of oral or written notice of the default to Landlord or Landlord fails to
pursue the rectification of its default with diligence and continuity or (ii)
Landlord’s default does not create or increase the risk of imminent danger of bodily
injury to or death of persons or damage to or destruction of property, including,
without limitation, the Building or Tenant’s property and Landlord fails to rectify its
default within 30 days after Tenant’s delivery of written notice of the default to
Landlord or within such longer period of time following the delivery of that notice as
may be reasonably required to accomplish the rectification of the default through the
exercise of prompt, diligent

29

 

	 	 	 	and continuous efforts, then Tenant may perform the obligation on behalf of
Landlord. Landlord shall pay to Tenant within 30 days after the date of Landlord’s
receipt of Tenant’s invoice the full amount of the reasonable cost and expense
Tenant incurs in performing the obligation on behalf of Landlord, together with the
amount of any reasonable legal fees Tenant incurs in instituting, prosecuting or
defending any action or proceeding by reason of any default in respect of any
obligation Landlord has undertaken under the terms of this Lease.

	 	(b)	 	If Landlord does not pay any amounts owing to Tenant under Section 8(e) or
Section 25(a), then Tenant may set off the amount due, including, without limitation,
reasonable legal fees and court costs included in the judgment, against the next
installments of Base Rent coming due under this Lease; provided, however, that until
Tenant obtains a final, non-appealable judgment against Landlord in a court of
competent jurisdiction, the maximum amount that Tenant may set off from Base Rent is
Two Hundred Thousand Dollars ($200,000.00) during any successive twelve (12) month
period; provided, further, that the foregoing $200,000 limit does not apply to set offs
for failure(s) by Landlord to fund the Tenant Allowances under Exhibit D.

Section 26. Late Charges; Interest on Late Payments.

If Tenant becomes delinquent with respect to the payment of any Base Rent or any
additional rent becoming due under the terms of this Lease and the default continues for
more than five days after the due date, then Tenant shall pay to Landlord with the late
payment a late fee equal to 4% of the amount of the payment; provided, however that such
late fee shall not be due the first time such delinquency occurs during any successive
twelve (12) month period. Any past due installment of Base Rent or additional rent under
this Lease will bear interest from the date due until the date paid at the rate of 10% per
annum. Any amount with respect to which Landlord becomes delinquent in making payment to
Tenant as required by this Lease will bear interest from the date due until the date paid at
the rate of 10% per annum.

Section 27. Quiet Enjoyment.

Landlord warrants that, so long as Tenant pays all Base Rent and additional rent that
becomes due under the teams of this Lease and is not otherwise in default in respect of the
performance of any obligation it undertakes under the terms of this Lease, in either case,
within all applicable grace, notice and cure periods, Tenant may peaceably and quietly enjoy
the Premises at all times during the Term without disturbance by anyone.

Section 28. Subordination, Attornment & Non-Disturbance.

At Landlord’s request, and subject to the immediately succeeding sentence, Tenant shall
subordinate its rights under this Lease to the lien of any first mortgage or first deed of
trust hereinafter executed in favor of any bank, insurance company or other lending
institution against the Premises. As a condition to any subordination that Landlord
requests, the mortgage holder must execute an agreement in substantially the form attached
to this Lease as Exhibit G. Simultaneously with the execution of this Lease by
Landlord, Landlord shall deliver to Tenant a Subordination, Non-Disturbance and Attornment
Agreement (SNDA) executed by the holder of any mortgage listed on Exhibit K in
recordable form and approved by Tenant.

30

 

Section 29. Landlord’s Sale of Premises.

Landlord’s sale of the Premises and the purchaser’s express written assumption of the
obligations Landlord undertakes under the terms of this Lease will relieve Landlord from
liability arising under the terms of this Lease by reason of any act, occurrence or omission
occurring after the consummation of the sale. The parties do not intend the foregoing to
relieve Landlord from those obligations that the terms of this Lease require Landlord to
perform prior to the sale. Except in connection with financing its acquisition of the Land
and the construction of the Landlord Improvements, Landlord may not assign or transfer its
interest in the Premises or this Lease prior to the substantial completion of the Landlord
Improvements.

Section 30. Broker’s Commissions.

Each party represents to the other that the only broker used in connection with this
Lease is Trammell Crow Company, whose commission Landlord shall pay, pursuant to a separate
written agreement. Each party shall defend and indemnify the other from and against any
claims, demands and actions brought by any broker or other finder to recover a brokerage
commission or any other damages on the basis of alleged dealings with the indemnifying party
contrary to the foregoing representation.

Section 31. Estoppel Certificate.

Within 30 days after Tenant’s receipt of Landlord’s written request, Tenant shall
execute and deliver to Landlord a statement in substantially the form of the attached
Exhibit H that (i) certifies that this Lease is unmodified and in full force and
effect (or, if modified, states the nature of the modification and certifies that this Lease
as so modified is in full force and effect) and the date to which Base Rent is paid in
advance, if any, and (ii) acknowledges that, to Tenant’s knowledge, there are no uncured
defaults on the part of Landlord or specifies such defaults if Tenant claims any.

Section 32. Holding Over.

If Tenant remains in possession of the Premises after the Expiration Date, that
occupancy will be a tenancy from month-to-month, at a Base Rent for the first three (3)
months after the Expiration Date equal to 110% of the Base Rent payable during the month in
which the Expiration Date occurs, and thereafter at a Base Rent equal to 150% of the Base
Rent payable during the month in which the Expiration Date occurs, and subject to all of the
other terms and conditions of this Lease.

Section 33. Assignment and Subletting.

So long as the Premises are used for the Intended Use, Tenant may transfer or assign
its interest in this Lease and may sublet all or a portion of the Premises without first
obtaining Landlord’s written consent. If Tenant desires to assign this Lease or sublet all
or a portion of the Premises to an entity or person, other than a Related Entity
(hereinafter defined), which intends to use the Premises for other than the Intended Use,
then Tenant must obtain Landlord’s written consent prior to such assignment or sublease.
Landlord may not unreasonably withhold, condition, or delay its consent. Tenant may, upon
notice to Landlord, sublet all or any part of the Premises without first obtaining
Landlord’s written consent to an entity that controls, is controlled by, or is

31

 

under common control with, Tenant, to the surviving corporation in a merger,
consolidation, or other reorganization involving Tenant, or to the purchaser of all or
substantially all of Tenant’s assets (each, a Related Entity), without first obtaining
Landlord’s written consent. No subletting, assignment of rights, or delegation of duties
that Tenant may make will relieve Tenant from liability for the performance of the
obligations Tenant undertakes under the terms of this Lease, unless Landlord, in its sole
discretion, grants such relief. Landlord has no recapture rights in connection with any
assignment or sublease.

Section 34. Right of First Offer.

If, during the Lease Term, Landlord, in its sole discretion, elects to offer to sell the
Premises to any third party, then provided the Lease is in full force and effect and there
is no uncured Event of Default under the Lease, Tenant will have a right of first offer (the
Right of First Offer) to purchase the Premises prior to Landlord selling the Premises to any
third party. Prior to Landlord selling the Premises to third parties, Landlord will first
offer to sell the Premises to Tenant by giving a written notice (the Offer) to Tenant
containing all of the material terms and conditions upon which Landlord would be willing to
sell the Premises, including, without limitation, the purchase price and proposed closing
date. Tenant will have 10 days from receipt of the Offer to accept the Offer in writing.
The failure of Tenant to accept the Offer within such 10 day period will constitute a
rejection of the Offer. If Tenant accepts the Offer, Landlord and Tenant shall promptly
enter into a purchase and sale agreement incorporating, among others, the terms set forth in
the Offer. If Tenant rejects (or is deemed to have rejected) the Offer, Landlord will be
free to sell the Premises to a third party upon the same basic terms and conditions as were
stated in the Offer and the Right of First Offer granted herein will automatically terminate
and be of no further force or effect. However, if (a) Landlord fails to enter into a
purchase and sale agreement for the Premises within 180 days after the Offer is rejected or
deemed rejected, (b) Landlord fails to sell the Premises within 300 days after the Offer is
rejected or deemed rejected, or (c) Landlord desires to enter into a purchase and sale
agreement on economic terms equal to or less than 95% of that contained in the Offer,
Tenant’s Right of First Offer will be reinstated and apply anew.

Section 35. Miscellaneous.

	 	(a)	 	This Lease inures to the benefit of and binds each of the parties and their
respective successors and assigns.
	 
	 	(b)	 	All section headings and captions used in this Lease are purely for convenience
and do not affect the interpretation of this Lease.
	 
	 	(c)	 	All Exhibits referenced in this Lease are incorporated in and made a part of
this Lease, even if they are not physically attached to this Lease.
	 
	 	(d)	 	This Lease will be governed by and interpreted in accordance with the laws of
the State where the Premises are located, and the parties submit to the jurisdiction of
any appropriate state court within that State for adjudication of disputes arising from
this Lease.

32

 

	 	(e)	 	Except as otherwise provided, the parties may amend this Lease only by means of
written agreements signed on behalf of Tenant and Landlord by their respective
authorized signatories.
	 
	 	(f)	 	This Lease supersedes all prior understandings, representations, negotiations,
and correspondence between the parties and constitutes the entire agreement between
them with respect to the matters described in this instrument. No course of dealing,
course of performance, or usage of trade will modify or affect this Lease.
	 
	 	(g)	 	The invalidity, illegality, or unenforceability of any provision of this Lease
will not affect or impair the validity, legality, and enforceability of the remaining
provisions.
	 
	 	(h)	 	The failure of either party at any time to require performance by the other of
any provision of this Lease will not affect that party’s right to enforce that
provision, nor will the waiver by either party of any breach of any provision of this
Lease constitute a waiver of any further breach of the same provision or any other
provision.
	 
	 	(i)	 	The parties may execute this Lease in any number of counterparts and all those
counterparts taken together will constitute a single agreement. Facsimile signatures
provided by any party to this Lease will be treated as original signatures of the party
providing the facsimile signature.
	 
	 	(j)	 	All notices, approvals, requests, consents, and other communications given,
required or permitted in accordance with the terms of this Lease must be in writing and
must be hand-delivered or sent by facsimile transmission, Federal Express overnight
service or United States certified or registered mail. The parties will consider
notices given or delivered when received, except that if either party intentionally
acts to refuse delivery of a notice sent by any nationally recognized overnight courier
service or United States certified or registered mail, then the effective date shall be
the date of delivery to the nationally recognized overnight courier service or the U.S.
mail on a business day during normal business hours. The parties will address notices
as follows:

If to Landlord:

KDC-Regent I Investments, LP

c/o Koll Development Company

8411 Preston Road, Suite 700

Dallas, Texas 75225

Attention: Tobin C. Grove

                 President

33

 

with a copy to:

Munsch Hardt Kopf & Harr, P.C.

4000 Fountain Place

1445 Ross Avenue

Dallas, Texas 75201-2790

Attention: Carl Klinke

If to Tenant:

Epsilon Data Management, Inc.

601 Edgewater Drive

Wakefield, MA 01880

Attention: Sherry M. Jacques

                 VP, Legal Counsel

with a copy prior to the Commencement Date to:

Gardere Wynne Sewell LLP

3000 Thanksgiving Tower

1601 Elm Street, Suite 3000

Dallas, Texas 75201-4761

Attention: Stewart Wayne

	 	 	 	A party may change the address to which it wishes notices to be sent by delivering
notice of the change of address to the other party in accordance with the terms of
this Section 35(j).
	 
	 	(k)	 	Except as provided below, Tenant may not seek to satisfy any judgment that
Tenant obtains against Landlord by reason of the negligence of Landlord or any of its
shareholders, directors, officers, agents, employees, or contractors or Landlord’s
failure to perform any of the obligations it has undertaken under the terms of this
Lease from any source other than Landlord’s interest in the Premises including all
insurance and condemnation proceeds and the revenue generated by the operation of the
Premises and no asset of any shareholder, director, officer, employee, or agent of
Landlord or any of the successors or assigns of any of the foregoing will be subject to
attachment or execution to satisfy the judgment. Notwithstanding any provision of this
Lease apparently to the contrary, Tenant may also satisfy any final, non-appealable
judgment against Landlord related to this Lease by setting off the amount of the
judgment against Base Rent the amount of the judgment.
	 
	 	(l)	 	If Landlord or Tenant is a corporation, partnership, or limited liability
company, each individual executing this Lease on behalf of that party represents and
warrants that that party is a duly formed and existing entity qualified to do business
in Texas, that that party has full right and authority to execute and deliver this
Lease, that each person signing on behalf of that party is authorized to do so, and
that all necessary corporate or partnership action has been taken.
	 
	 	(m)	 	Whenever necessary or appropriate, the neuter gender as used herein shall be
deemed to include the masculine and feminine; the masculine to include the

34

 

	 	 	 	feminine and neuter; the feminine to include the masculine and neuter; the singular
to include the plural; and the plural to include the singular.
	 
	 	(n)	 	This Lease may be executed in one or more counterparts, each of which shall
constitute an original, but all of which, taken together, shall be considered one and
the same agreement.
	 
	 	(o)	 	To the maximum extent permitted by applicable laws, each party knowingly,
voluntarily, and intentionally waives the right to a trial by jury in respect of any
litigation based on this Lease, arising our of, under, or in connection with this
Lease, or any course of conduct, course of dealing, statement (whether verbal or
written), or action between the parties or any exercise by any party of any of its
respective rights under this lease or in any way relating to the Premises. This waiver
is a material inducement for the parties to enter into this Lease. This waiver
survives the expiration or termination of this Lease.

Section 36. Time of Essence.

Time is of the essence with respect to this Lease. If the final day of any period of
time described in this Lease is a Saturday, Sunday or a legal holiday under the laws of the
United States or the State where the Premises are located, that period is extended to the
next day that is not a Saturday, Sunday or legal holiday.

Section 37. Validity of Agreement.

This Lease will not be valid or bind Landlord or Tenant unless an authorized signatory
of Landlord or Tenant has signed it on behalf of the respective party.

Section 38. Guaranty.

Upon execution of this Lease, Tenant shall cause Alliance Data Systems Corporation, a
Delaware corporation (Guarantor), to execute and deliver to Landlord a Guaranty in the form
attached to this Lease as Exhibit I.

Section 39. Incentives.

Tenant expects to receive certain economic incentives (Incentives) from the City of
Irving, Texas, in connection with the construction of the Improvements and the location of
Tenant’s business within the City of Irving, Texas. Landlord shall cooperate to the extent
Tenant reasonably requests and at no costs to Landlord in order to satisfy any condition
established in connection with Tenant’s receipt of the benefit of the Incentives, including,
without limitation, supplying any necessary information, executing required forms, and other
similar actions. The parties intend that Tenant and not Landlord will receive any economic
benefit derived from participation in such programs.

Section 40. Arbitration.

If Tenant elects to submit an HVAC Replacement Decision to arbitration under this
Section 41, then Tenant must notify Landlord of Tenant’s election within 30 days after
Tenant installs the HVAC Replacement. All arbitrations shall occur at a location in

35

 

Dallas, Texas, chosen by the arbitrator and shall be conducted pursuant to the
Commercial Arbitration Rules of the American Arbitration Association (or the successor
organization, or if no such organization exists, then from an organization composed of
persons of similar professional qualifications) in effect at the time. When Tenant gives
notice to Landlord, Tenant shall give simultaneous notice to the director of the Dallas,
Texas regional office of the American Arbitration Association (or the successor
organization, or of no such successor organization exists, then to an organization composed
of persons of similar professional qualifications), requesting such organization to select,
as soon as possible but in any event within the next 30 days, one arbitrator with recognized
expertise in the subject matter of the arbitration (i.e., a mechanical engineer with at
least 5 years of experience dealing with HVAC systems in buildings similar to the Building).
The arbitrator shall conduct such hearings and investigations as the arbitrator shall deem
appropriate and shall, within 30 days after having been appointed, decide whether Tenant’s
decision to install the HVAC Replacement rather than to repair the applicable portions of
the HVAC system was reasonable based on the cost of the HVAC Replacement compared to the
cost of the repairs. If the arbitrator determines that the HVAC Replacement Decision was
reasonable, then Landlord shall be obligated to pay Tenants Landlord’s share of the HVAC
Replacement costs as provided in Section 8(c) above. Each party shall pay its own counsel
fees and expenses, if any, in connection with the arbitration under this Section 41, and the
parties shall share equally all other expenses and fees of any such arbitration. The
determination rendered in accordance with the provisions of this Section 41 shall be final
and binding. The arbitrator shall not have the power to add to, modify, or change any of
the provisions of this Lease. Landlord and Tenant may at any time by mutual written
agreement discontinue arbitration proceedings and themselves agree upon the matter submitted
to arbitration.

[Signature pages follow.]

36

 

     The parties have signed this Lease on the date first above written.

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Landlord	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	KDC-REGENT I INVESTMENTS, LP,	 	 
	 	 	a Texas limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	KDC-Regent I Investments GP, LLC,	 	 
	 	 	 	 	a Texas limited liability company,	 	 
	 	 	 	 	its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Koll Development Company I, LP,
	 	 	 	 	 	 	a Delaware limited partnership,
	 	 	 	 	 	 	Its Sole Member
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	SWV, LLC,	 	 
	 	 	 	 	 	 	 	 	a Delaware limited liability company,	 	 
	 	 	 	 	 	 	 	 	Its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Tobin C. Grove, President

37

 

	 	 	 	 	 
	 	 	Tenant
	 
	 	 	 	 
	 	 	EPSILON DATA MANAGEMENT, INC.,
	 	 	a Delaware corporation
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:Michael Iaccarino
	 

	 	 	 	Title:President & Chief Executive Officer

38

 

EXHIBIT A

OUTLINE SPECIFICATIONS

Exhibit A Page 1 of 1

 

EXHIBIT B

THE LAND

Lot 1, Block A, of KDC-Epsilon Addition, Lot 1 and Lot 2, Block A, an Addition to the City of
Irving, Dallas County, Texas, according to the Preliminary/Final Plat thereof recorded in Volume
2005099, Page 00144, of the Plat Records of Dallas, County, Texas.

Exhibit B Page 1 of 1

 

 

EXHIBIT C

FINAL TENANT IMPROVEMENTS PLANS AND SPECIFICATIONS

[To be approved by Landlord and Tenant under Section 2(b). The Final Tenant Improvements
Plans and Specifications will become part of this Lease upon approval by Landlord and Tenant but
they will not be physically attached to this Lease.]

Exhibit C Page 1 of 1

 

 

EXHIBIT D

TENANT ALLOWANCES

	1.	 	Initial Premises.

	 	(a)	 	Landlord shall provide the following Tenant Allowances to Tenant for the
initial Premises:

	 	 	 	 	 	 	 	 	 	 	 
	(i)

	 	Tenant Finish Allowance:
	 	 	($	 	 	 	1,875,000	)
	(ii)

	 	Space Planning:
	 	 	($	 	 	 	262,500	)
	(iii)

	 	Moving Expenses
	 	 	($	 	 	 	150,000	)
	(iv)

	 	Phone/Data Cabling
	 	 	($	 	 	 	375,000	)
	(v)

	 	Security System
	 	 	($	 	 	 	99,750	)
	(vi)

	 	Tenant CM Fees
	 	 	($	 	 	 	150,000	)
	(vii)

	 	Signage
	 	 	($	 	 	 	10,000	)
	(viii)

	 	Flagpoles
	 	 	($	 	 	 	10,000	)
	 	 	 
	 

	 	TOTAL
	 	 	($	 	 	 	2,932,250	)

	 	(b)	 	Tenant, in its sole discretion, may reallocate the Tenant Allowances among the
line items specified above, but the aggregate total of the Tenant Allowances may not
exceed $2,932,250 (as adjusted under Section 4(b)).
	 
	 	(c)	 	Tenant shall submit draws against the Tenant Allowances to Landlord no later
than the fifth day of each calendar month for expenses incurred by Tenant during the
prior calendar month. Each draw must include copies of receipts, invoices, and other
backup materials reasonably satisfactory to Landlord to confirm the expenses for which
Tenant is requesting payment. Landlord may inspect, audit, and copy Tenant’s books and
records related to the Tenant Allowances at Tenant’s home office any time during
Tenant’s normal business hours upon at least 48 hours prior written notice. Tenant
shall retain its books and records related to the Tenant Allowances at its home office
for at least two (2) years after final completion of the Tenant Improvements.
	 
	 	(d)	 	For the portions of each draw representing payments for Tenant Improvements:

	 	(i)	 	The draw must include conditional partial lien releases in a
form reasonably approved by Landlord from Tenant’s contractor and
subcontractors for the payments being requested by the contractor and each
subcontractor in the current draw and unconditional partial lien releases in a
form reasonably approved by Landlord from Tenant’s contractor and
subcontractors for the amounts paid by Landlord under the prior draw.
	 
	 	(ii)	 	Landlord may retain 10% of the amount of each draw representing
payments for Tenant Improvements until 30 days after final completion of the
Tenant Improvements. Tenant must provide Landlord conditional final lien
releases in a form reasonably approved by Landlord from Tenant’s contractor and
subcontractors in order to receive the retainage held by Landlord in connection
with the Tenant Improvements.

Exhibit D Page 1 of 4

 

 

	 	(e)	 	Landlord shall fund the amount of each draw reasonably
approved by Landlord within twenty (20) days after receipt by Landlord of the
Invoices and other backup materials reasonably requested by Landlord; but
Landlord may disapprove and withhold funding of any draw requested by Tenant
if:

	 	(i)	 	the draw or any applicable backup information is not complete
to Landlord’s reasonable satisfaction;
	 
	 	(ii)	 	any mechanics’ or materialmen’s lien or other lien has been
filed against the Land or the Building by any of Tenant’s contractors,
subcontractors, laborers, suppliers, or others, or Landlord has received any
notice from any of them indicating an intent to file any such lien, and Tenant
has not bonded around the lien or otherwise posted security with Landlord
reasonably satisfactory to Landlord related thereto; or
	 
	 	(iii)	 	An Event of Default has occurred under the Lease and is
continuing, either at the time of submission or funding of the draw.

	 	(f)	 	If Tenant elects not to use all of the Tenant Allowances, Tenant may elect to
receive a reduction in the annual Base Rent based on the aggregate amount of any unused
Tenant Allowances by giving written notice specifying its election to Landlord no later
than forty five (45) days after final completion of the Tenant Improvements The
reduction will be in an amount equal to Eight Thousand Two and 50/100 Dollars
($8,002.50) for each $100,000 of unused Tenant Allowances (or pro rata portion thereof
on a proportionate basis). If there are unused Tenant Allowances and Tenant timely
notifies Landlord that Tenant elects to receive a reduction in the annual Base Rent,
then Landlord shall promptly prepare, execute, and deliver to Tenant an appropriate
amendment to the Lease specifying the annual Base Rent adjustment determined by
Landlord under this Paragraph 1(f). Tenant shall promptly execute the amendment and
return it to Landlord. If Tenant does not use all of the Tenant Allowances within
forty five (45) days after the Commencement Date, then any unused balance of the Tenant
Allowances shall be applied against Base Rent or additional rent.

	2.	 	Expansion Option.

If Tenant exercises the Expansion Option under Section 12 of the Lease, Landlord will
provide Tenant with the following Tenant Allowances (on a PSF basis):

	 	 	 	 	 	 	 	 	 	 	 
	(i)

	 	Tenant Finish Allowance
	 	 	 	$	25.00	 	 	PSF
	(ii)

	 	Space Planning
	 	 	 	$	3.50	 	 	PSF
	(iii)

	 	Phone / Data Cabling
	 	 	 	$	5.00	 	 	PSF
	(iv)

	 	Tenant CM Fees
	 	 	 	$	2.00	 	 	PSF
	 
	Total

	 	 	 	 	 	$	35.50	 	 	PSF

Exhibit D Page 2 of 4

 

 

	3.	 	Changes to Outline Specifications.

The parties acknowledge that the Outline Specifications were revised at the request of
Tenant in accordance with a Letter Agreement dated May 4, 2005 (a copy of which is attached
as Schedule 1 to this Exhibit D) and that the increased cost to Landlord of Tenant’s changes
is $122,100. If Tenant does not pay the sum of $122,100 to Landlord within 90 days after
the Effective Date, then Landlord will be entitled to a credit against the aggregate amount
of the Tenant Allowances in the amount of $122,100.

Exhibit D Page 3 of 4

 

 

SCHEDULE 1

TO

EXHIBIT D

Exhibit D Page 4 of 4

 

 

EXHIBIT E

FORM OF TENANT ACKNOWLEDGMENT LETTER

KDC-Regent I Investments, LP

c/o Koll Development Company

8411 Preston Road, Suite 700

Dallas, Texas 75225

Attn: Tobin C. Grove, President

	 	 	 	 	 
	 

	 	Re:
	 	Acknowledgment Letter with respect to that certain Lease Agreement (the Lease)
dated May 31, 2005, by and between KDC-Regent I Investments, LP (Landlord) and Epsilon
Data Management, Inc. (Tenant)

Gentlemen:

This letter constitutes the Acknowledgement Letter required under Section 3(e) of the Lease. All
capitalized terms used but not otherwise defined in this Acknowledgment Letter have the meanings
assigned to them in the Lease.

Tenant accepts the condition of the Premises in accordance with the Lease, and Tenant hereby
certifies to Landlord and Landlord’s assignee, as follows:

	 	1.	 	The Commencement Date is                     , 2006.
	 
	 	2.	 	The Expiration Date is                               , 2018.
	 
	 	3.	 	The annual Base Rent is (check appropriate blank and add appropriate
information if blank (b) is selected):

	 	a.	 	           unchanged from the annual Base Rent specified in Section
4(a) of the Lease; or
	 
	 	b.	 	           changed from the annual Base Rent specified in Section
4(a) of the Lease, resulting in the following Base Rent:

	 	 	 	 	 	 	 	 	 
	Lease Years	 	Annual Base Rent	 	 	Monthly Base Rent	 
	1-4
	 	$                     ($          PSF)	 	$	                    	 
	5-8
	 	$                     ($          PSF)	 	$	                    	 
	9-12
	 	$                     ($          PSF)	 	$	                    	 

	 	4.	 	The Lease is unmodified and in full force and effect and there are no
outstanding notices of default to Tenant’s obligations or Landlord’s obligations under
the Lease. To the best knowledge of Tenant, there is no default under the Lease and no
event has occurred, which with the giving of notice or the passage of time, or both,
will become such a default.
	 
	 	5.	 	Tenant has not assigned, pledged, hypothecated or otherwise transferred the
Lease.

Exhibit E Page 1 of 2

 

 

	 	6.	 	As of the date hereof, Tenant currently has no claim against Landlord for any
right of offset, deferment, abatement, or default or right of counterclaim or defense
to the payment of Base Rent or any other monies due under the Lease.
	 
	 	7.	 	There are currently no disputes under or in connection with the Lease between
Landlord and Tenant.

     EXECUTED as of the date first above written.

	 	 	 	 	 	 	 
	 	 	EPSILON DATA MANAGEMENT, INC.
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 

AGREED AND ACCEPTED this

                     day                     of, 2006:

KDC-REGENT I INVESTMENTS, LP,

a Texas limited partnership

	 	 	 
	By:

	 	KDC-Regent I Investments GP, LLC,
	 

	 	a Texas limited liability company,
	 

	 	its General Partner

	 	 	 	 	 
	 

	 	By:
	 	Koll Development Company I, LP,
	 

	 	 	 	a Delaware limited partnership,
	 

	 	 	 	Its Sole Member

	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	SWV, LLC,
	 

	 	 	 	 	 	a Delaware limited liability company,
	 

	 	 	 	 	 	Its General Partner

	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Tobin C. Grove, President
	 	 

Exhibit E Page 2 of 2

 

 

EXHIBIT F

KNOWLEDGE INDIVIDUALS

The following knowledge individuals are acting solely in their capacity as officers, agents, or
employees of Landlord or an affiliate of Landlord, are in no manner expressly or impliedly making
any representations or warranties in their individual capacities, and have no personal liability in
connection with this Lease:

M. Scott Ozymy, SVP – Koll Development Company

Murray Newton, EVP – Koll Development Company

James Williams, VP – Koll Development Company

Exhibit F Page 1 of 1

 

 

EXHIBIT G

FORM OF SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT

Exhibit G Page 1 of 1

 

 

EXHIBIT H

FORM OF ESTOPPEL CERTIFICATE

                                        , 20                                                            

                                                            

                                                            

                                                            

                                                            

                                                            

                                                            

                                                            

	 	 	 	 	 
	 

	 	Re:
	 	Lease Agreement dated May 31, 2005, between KDC-Regent I Investments, LP, a
Texas limited partnership (Landlord), and Epsilon Data Management, Inc., a Delaware
corporation (Tenant), (as amended, the Lease),                                         Regent Center,
Irving, Texas (the Building)

Dear                      :

Tenant understands that                                         (Purchaser) is purchasing the Building from Landlord
and Purchaser and Landlord are relying on this Estoppel Certificate. Defined terms in the Lease
have the same meanings in this Estoppel Certificate.

For $10 and other good and valuable consideration, the receipt and sufficiency of which are
acknowledged, Tenant ratifies the Lease and certifies to Purchaser and Landlord that:

	1.	 	Tenant is occupying and conducting business in the Premises.
	 
	2.	 	As of the date hereof, the Base Rent under the Lease is $                          per month payable in
advance on the first day of each calendar month. Base Rent is paid through           1, 20     .
	 
	3.	 	The Lease is in full force and effect and Tenant has not assigned or subleased its interest
in the Lease except as specified on Schedule A attached to this Estoppel Certificate.
	 
	4.	 	A true and correct copy of the Lease and all amendments thereto is attached as Schedule
B to this Estoppel Certificate.
	 
	5.	 	The Lease is the entire agreement between Landlord and Tenant concerning the Premises.
	 
	6.	 	The Term expires on                     ,20     .
	 
	7.	 	To Tenant’s actual knowledge, Landlord satisfied all of its obligations regarding the
installation of Landlord Improvements, except as follows:

                                        

	8.	 	Tenant constructed all Tenant Improvements as required under the Lease.

Exhibit H Page 1 of 2

 

 

	9.	 	To Tenant’s actual knowledge, no default by Landlord has occurred under the Lease and is
continuing except as specified on Schedule A.

	10.	 	Tenant is not entitled to any accrued abatements, setoffs, or deductions from Base Rent or
additional rent under the Lease except as expressly set forth therein or as specified in
Schedule A.
	 
	11.	 	No Base Rent has been paid more than one month in advance.
	 
	12.	 	There is no Security Deposit under the Lease.

	 	 	 	 	 	 	 
	 	 	EPSILON DATA MANAGEMENT, INC.,
	 	 	a Delaware corporation
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 

Exhibit H Page 2 of 2

 

 

JOINDER BY GUARANTOR

Guarantor joins in the execution of this Estoppel Certificate for the purpose of consenting to the
execution hereof by Tenant and to confirm that its Guaranty of the Lease remains in full force and
effect.

	 	 	 	 	 	 	 
	 	 	ALLIANCE DATA SYSTEMS CORPORATION,
	 	 	a Delaware corporation
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 

 

 

SCHEDULE A

TO

EXHIBIT H

	1	 	List any assignments or subleases or state NONE:
	 
	2	 	List any defaults by Landlord that have occurred and are continuing or state NONE:
	 
	3	 	List any accrued abatements, setoffs, or deductions from Base Rent or additional rent to
which Tenant is entitled at this time (other than those expressly set forth in the Lease) or
state NONE:

Schedule A to Exhibit H

 

 

SCHEDULE B

TO

EXHIBIT H

COVER PAGE FOR COPY OF THE LEASE AND ALL AMENDMENTS

Schedule B to Exhibit H

 

 

EXHIBIT I

LEASE GUARANTY

This Lease Guaranty (this Guaranty) is executed by Alliance Data Systems Corporation, a Delaware
corporation (Guarantor), as of May ___, 2005.

RECITALS

	A.	 	A Lease Agreement (the Lease), dated as of even date herewith is to be executed by KDC-Regent
I Investments, LP, a Texas limited partnership (Landlord), as Landlord, and Epsilon Data
Management, Inc., a Delaware corporation (Tenant), as Tenant, covering Premises consisting of
approximately 75,000 square feet of shell building in Regent Center, an office project located
in Irving, Dallas County, Texas, more particularly described in the Lease. Defined terms in
the Lease have the same meanings in this Guaranty.

	B.	 	As a condition to Landlord’s execution of the Lease, Landlord required Guarantor to guarantee
the full performance of all of the liabilities, obligations, and duties of Tenant under the
Lease. Tenant is a subsidiary of Guarantor, and Tenant’s entering into the Lease will benefit
Guarantor.

	C.	 	Guarantor agreed to sign this Guaranty to induce Landlord to enter into the Lease with
Tenant.

NOW, THEREFORE, in consideration of the recitals and other good and valuable consideration, the
receipt and sufficiency of which are acknowledged, Guarantor agrees that:

	1.	 	Guarantor unconditionally assumes and agrees to perform all liabilities, obligations, and
duties of Tenant under the Lease. Guarantor guarantees to Landlord and Landlord’s successors
and assigns the full, prompt, and complete performance of all of the terms, covenants,
conditions, and provisions of the Lease to be kept and performed by Tenant or Tenant’s
successors or assigns, including, without limitation, the payment of all Base Rent, additional
rent, and other charges to accrue under the Lease, all obligations of Tenant related to the
construction of Tenant Improvements and the maintenance of the Premises, and all damages that
may arise as a consequence of nonperformance under the Lease (collectively, the Obligations).

	2.	 	The liability of Guarantor under this Guaranty is unconditional and primary. In relation to
any right of action that accrues against Tenant under the Lease, Landlord may, at its option,
proceed from time to time solely against Guarantor and any other person or entity without
regard to Tenant’s ability to perform and without first commencing any action, exhausting any
remedy, obtaining any judgment, or proceeding in any way against Tenant or any other person or
entity. Landlord may bring suit against Guarantor to enforce any liability, duty, or
obligation under this Guaranty without joinder of Tenant or any other person or entity.

Exhibit I Page 1 of 4

 

 

	3.	 	This Guaranty continues until Tenant and Tenant’s successors, representatives or assigns have
fully discharged all Obligations under the Lease. This Guaranty is not diminished by payments
of Base Rent or performance of the Obligations by Guarantor. This Guaranty terminates only
when all Obligations under the Lease are fully discharged, whether before or after the
expiration or earlier termination of the Lease.

	4.	 	Until all the Obligations under the Lease to be performed and observed by Tenant or Tenant’s
successors or assigns are fully performed, Guarantor:

	 	(a)	 	has no right of subrogation or any other right to enforce any remedy against
Tenant or Tenant’s successors or assigns by reason of any payment or performance by
Guarantor under this Guaranty; and
	 
	 	(b)	 	subordinates any liability or indebtedness of Tenant or Tenant’s successors or
assigns now or hereafter held by Guarantor to all Obligations of Tenant or Tenant’s
successors or assigns to Landlord under the Lease.

	5.	 	Guarantor waives the benefits of any right of discharge under Chapter 34 of the Texas
Business and Commerce Code and any rights of sureties and guarantors thereunder. This
Guaranty is not released, diminished, impaired, reduced, or affected by any limitation of
liability or recourse under the Lease or by the occurrence of any one or more of the following
events:

	 	(a)	 	the taking or accepting of any security or other guaranty for the Lease;
	 
	 	(b)	 	any assignment by Tenant of its interest in the Lease or any sublease by Tenant
of all or any part of the Premises.
	 
	 	(c)	 	any release, surrender, exchange, subordination, or loss of any security at any
time existing or purported or believed to exist in connection with the Lease;
	 
	 	(d)	 	the insolvency, bankruptcy, disability, dissolution, termination, receivership,
reorganization, or lack of corporate, partnership, or other power of Tenant, Guarantor,
or any party at any time liable for the payment or performance of the Lease, whether
now existing or hereafter occurring;
	 
	 	(e)	 	expansion of the Premises, renewal, extension, modification, or rearrangement
of the payment or performance of the Lease, either with or without notice to or consent
of Guarantor, or any adjustment, indulgence, forbearance, or compromise that may be
granted or given by Landlord to Tenant or Guarantor;
	 
	 	(f)	 	any neglect, delay, omission, failure, or refusal of Landlord to take or
prosecute any action for the collection or enforcement of the Lease or to foreclose or
take or prosecute any action to foreclose upon any security therefor or to take or
prosecute any action in connection with the Lease;

Exhibit I Page 2 of 4

 

 

	 	(g)	 	any failure of Landlord to notify Guarantor of any expansion of the Premises,
renewal, extension, rearrangement, modification, or assignment of the Lease or any part
thereof, or of the release of or change in any security, or of any other action taken
or refrained from being taken by Landlord against Tenant, or of any new agreement
between Landlord and Tenant, it being understood that Landlord is not required to give
Guarantor any notice of any kind under any circumstances with respect to or in
connection with the Lease;
	 
	 	(h)	 	the unenforceability of all or any part of the Lease against Tenant, or any
other circumstance that might otherwise constitute a legal or equitable discharge of a
surety or guarantor, it being agreed that Guarantor remains liable under this Guaranty
whether Tenant or any other person is found not liable on the Lease or the Obligations
for any reason; or
	 
	 	(i)	 	any payment by Tenant to Landlord is held to constitute a preference under the
bankruptcy laws or if for any other reason Landlord is required to refund any payment
or to pay the amount thereof to someone else.

	6.	 	If any suit or action is brought in connection with the enforcement of this Guaranty or if it
is collected by legal proceedings or through any probate or bankruptcy court, Guarantor shall
pay reasonable legal fees and all other expenses and court costs incurred by Landlord in
connection therewith.

	7.	 	This Guaranty is binding upon the successors and assigns of Guarantor and inures to the
benefit of the successors and assigns of Landlord, including, without limitation, all lenders
holding a lien against the Premises.

	8.	 	The obligations of Guarantor, Tenant, and any other guarantor or surety of the Lease are
joint and several. Guarantor agrees that Landlord, in its discretion, may:

	 	(a)	 	bring suit against Guarantor, Tenant, and any other guarantor or surety of the
Lease jointly and severally or against any one or more of them;
	 
	 	(b)	 	compromise or settle with any one or more of Tenant and the guarantors or
sureties of the Lease for any consideration Landlord deems proper;
	 
	 	(c)	 	release one or more of the guarantors or sureties of the Lease or Tenant from
liability thereunder; and
	 
	 	(d)	 	otherwise deal with Guarantor, Tenant, and any other guarantor or surety of the
Lease, or any one or more of them, in any manner whatsoever, and no such action impairs
the rights of Landlord to collect under this Guaranty.

	9.	 	This Guaranty and all rights, obligations, and liabilities arising hereunder are to be
construed according to the laws of the State of Texas. This Guaranty is performable in Dallas
County, Texas, Guarantor consents to jurisdiction in any state or federal court in Dallas
County, Texas, and waives the right to be sued elsewhere.

Exhibit I Page 3 of 4

 

 

	10.	 	Guarantor represents and warrants to Landlord:

	 	(a)	 	Guarantor is a corporation validly existing and in good standing under the laws
of the State of Delaware.
	 
	 	(b)	 	Guarantor has the authority to execute this Guaranty and to perform its
obligations under this Guaranty. The person executing this Guaranty on behalf of
Guarantor is duly authorized to do so.

	11.	 	To the maximum extent permitted by law, Guarantor irrevocably waives all right to
trial by jury in any action, proceeding, or counterclaim (whether based on contract, tort, or
otherwise) arising out of or relating to any of the provisions of this Guaranty or the
lease.

     Executed as of the date first above written.

	 	 	 	 	 	 	 
	 	 	GUARANTOR:
	 
	 	 	 	 	 	 
	 	 	ALLIANCE DATA SYSTEMS CORPORATION,
	 	 	a Delaware corporation
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 

	 	 	 
	STATE OF                     

	 	§
	 

	 	§
	COUNTY OF                     

	 	§

This instrument was acknowledged before me on May ___, 2005, by                                         ,
                                                            of Alliance Data Systems Corporation, a Delaware corporation, on behalf of
the corporation.

	 	 	 	 	 	 	 
	 
	 	 	[SEAL]	 	 
	 

	 	 	 	Notary Public, State of	 	 
	 

	 	 	 	 	 	 

               [SEAL]

Exhibit I Page 4 of 4

 

 

EXHIBIT J

APPROVED GENERAL CONTRACTORS AND MAJOR SUBCONTRACTOR

General Contractors

James R. Thompson

Mapp Construction

Scott & Reid

Cadence McShane

Constructors

Turner

Pacific

Major Subcontractors

Tenant must submit the names of all Major Subcontractors to Landlord for its reasonable approval
prior to the time Tenant’s approved General Contractor sends out its bid requests. The term Major
Subcontractors includes drywall, paint, carpet, HVAC, plumbing, electrical fire protection, fire
alarm, energy management, commissioning, security, and cabling and all other trades whose
subcontract amount is anticipated to exceed $100.000.

Exhibit J Page 1 of 1

 

 

EXHIBIT K

TITLE EXCEPTIONS

	1.	 	Easement granted by Regent Center, Ltd., to Texas Power & Light Company, filed 10/15/1986,
recorded in Volume 86201, Page 3613, Deed Records of Dallas County, Texas.
	 
	2.	 	Limited or lack of access to road or highway abutting subject property as set forth in
instrument filed 03/04/1974, recorded in Volume 75045, Page 62, Deed Records of Dallas County,
Texas.
	 
	3.	 	Easements and other matters on the Preliminary/Final Plat of KDC-Epsilon Addition, Lot 1 and
Lot 2, Block A, an Addition to the City of Irving, Dallas County, Texas, recorded in Volume
2005099, Page 00144, of the Plat Records of Dallas, County, Texas.
	 
	4.	 	Deed of Trust, Security Agreement, Fixture Filing and Assignment of Leases and Rents executed
by Landlord, as Grantor, in favor of Mark M. Sloan, Trustee, for the benefit of Compass Bank,
as Beneficiary, and related loan documents.

Landlord represents and warrants with respect to the above described title exceptions that (i)
nothing contained in any of said exceptions prohibits or restricts Landlord from performing any or
all of its obligations under this Lease during the full term thereof, and (ii) other than as
specified in the SNDA, none of said exceptions adversely affects or interferes with Tenant’s
enjoyment of the Premises.

Exhibit K Page 1 of 1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}]]