Document:

EXHIBIT 10.25.2

 

SECOND AMENDMENT
TO LEASE

 

THIS SECOND
AMENDMENT (the “Amendment”), is entered into effective as of November 1,
2002, (the “Effective Date”) between Kayares International, LLC., a California
limited liability company, as successor in interest to Old Courthouse Square,
LLC (“Lessor”) and Advanced TelCom Group, Inc. (“Lessee”).

 

WHEREAS,
Lessor and Lessee entered into a Lease dated as of January 29, 1999, as
amended by Addendum One dated effective as of January 19, 1999 (the “First
Addendum”), Second Addendum to Lease dated effective as of January 29,
1999 (the “Second Addendum”), and the First Amendment to Lease dated August 12,
1999 (the “First Amendment”) (the First Addendum, the Second Addendum and the
First Lease are collectively referred to as the “Lease”).

 

WHEREAS,
Lessor and Lessee desire to expand the Premises to include the remaining
portion of the second floor of the Building not already leased to Lessee as the
Expansion Premises, such portion having a total of approximately 3657 rentable
square feet of space (the “Second Expansion Premises”) and to modify the Lease
in certain other respects (the Second Expansion Premises are more particularly
described on the floor plan attached hereto as Schedule 1).

 

WHEREAS, the
parties agree that current fair market rent for the Premises, would not be less
than $1.50 per square foot for the first floor and $1.20 per square foot for
the second floor, but in consideration of Lessee’s agreement to enter into this
Amendment and to assume all obligations under the Lease as amended herein,
Lessor has instead agreed to collect rent at the lower rate as provided in the
Lease as Amended herein; and

 

WHEREAS, GE
Business Productivity Solutions, Inc., (“GEBPS”) has agreed, conditioned
on the close of its purchase of the assets or stock of Lessee, to guaranty all
obligations of Lessee to Lessor under the Lease as amended herein, and in the
meantime, as provided and subject to the limitations set forth in its Guaranty
in the form attached as Schedule 2, to provide a limited guaranty of
Lessee’s rent obligations under the Lease as amended in this Amendment.

 

NOW THEREFORE,
and in consideration of the mutual agreements and covenants hereinafter set
forth, the parties wish to amend the Lease as follows:

 

1.)            All terms
defined in the Lease shall have the same meanings in this Amendment as in the
Lease.

 

2.)            As of the
Effective Date, the Premises shall be deemed to include the Second Expansion
Premises.

 

3.)            The term of
the Lease with respect to the Second Expansion Premises shall commence on the
Effective Date and expire on August 31, 2004 (collectively, with the
Expansion Term for the Expansion Premises, referred to herein as the “Expansion

 

1

 

Term”).  Notwithstanding the foregoing, Lessor will
have no obligation to repair or correct any non compliance with the conditions
required under Sections 2.2 and 2.3 of the Lease arising from any Improvements
made by the Lessee prior to the Closing Date within the Expansion Premises.

 

4.)            Commencing
on the Effective Date, Base Rent for the Second Expansion Premises shall be
$1.15 per rentable square foot within the Second Expansion Premises for the remaining
balance of the initial Expansion Term following the Second Expansion Commencement
Date.  As of November 1, 2003, the
Base Rent shall be $1.15 per rentable square foot within the Second Expansion
Premises plus a CPI increase (not to exceed 3%) until August 31, 2004.

 

5.)            Commencing
on the Effective Date, Lessee shall occupy 100% of the first floor and 100% of
the second floor, and shall be responsible for 100% of triple net expenses as
provided in the Lease, including but not limited to maintenance, insurance and
property taxes, until August 31, 2004, after which Lessee shall be obligated
to pay its pro-rata share of triple net expenses as provided in the Lease.

 

6.)            No later
than ten (10) days following full execution of this Amendment, Lessee
agrees to provide Lessor with a security deposit equal to one (1) month of
the Rent due under the Lease (as amended hereby) as security for Lessee’s
faithful performance of its obligations under this Lease to be held by Lessor
as follows:

 

If Lessee
fails to pay Rent, or otherwise Defaults under the Lease, Lessor may use, apply
or retain all or any portion of said Security Deposit for the payment of any
amount due Lessor or to reimburse or compensate Lessor for any liability,
expense, loss or damage which Lessor may suffer or incur by reason thereof.  If Lessor uses or applies all or any portion
of said Security Deposit, Lessee shall within ten (10) days after written
request therefor deposit monies with Lessor sufficient to restore said Security
Deposit to the full amount required by the Lease.  If the Base Rent increases during the term of
the Lease, Lessee shall, upon written request from Lessor deposit additional
monies with Lessor so that the total amount of the Security Deposit shall at
all time bear the same proportion to the Increased Base Rent as the initial
Security Deposit bore to the initial Base Rent. 
Should the Agreed Use be amended to accommodate a material change in the
business of Lessee or to accommodate a sublessee or assignee, Lessor shall have
the right to increase the Security Deposit to the extent necessary, in Lessor’s
reasonable judgment, to account for any increased wear and tear that the
Premises may suffer as a result thereof; provided, however, the foregoing shall
not apply to any assignment by Lessee by operation of law, or in connection
with any transfer or sale of all or substantially all of the assets or equity
interests of Lessee.  If a change in
control of Lessee occurs during the Lease and following such change the
financial condition of Lessee is, in Lessor’s reasonable judgment,
significantly reduced, Lessee shall deposit such additional monies with Lessor
as shall be sufficient to cause the Security Deposit to

 

2

 

be a
commercially reasonable level based on said changes in financial condition.  Lessor shall not be required to keep the
Security Deposit separate from its general accounts.  Within fourteen (14) days after the
expiration or termination of this Lease, if Lessor elects to apply the Security
Deposit only to unpaid Rent and otherwise within thirty (30) days after the
Premises have been vacated pursuant to Paragraph 7.4(c) of the Lease,
Lessor shall return that portion of the Security Deposit not used or applied by
Lessor.  No part of the Security Deposit
shall be considered to be held in trust, to bear interest or to be prepayment
for any monies to be paid by Lessee under the Lease.

 

7.)            Lessor and
Lessee acknowledge and agree that Lessee has occupied the Second Expansion
Premises, and has made improvements in such Premises, including the Second
Expansion Premises, and that such Second Expansion Premises (and all of Lessee’s
improvements to the Premises) is acceptable “as is” as of the Effective Date.  If and to the extent any repairs are required
within the Second Expansion Premises to bring such Second Expansion Premises
and such prior tenant improvements into compliance with the conditions required
under Sections 2.2 and 2.3 of the Lease, Lessee agrees to pay Lessor fifty
percent (50%) of any such direct and actual expenses incurred up to a maximum
of $10,000 to be paid by Lessee.

 

8.)            The Lease
is further amended by deleting in its entirety the contact information for
Lessor appearing adjacent to its signature on the Lease and inserting, in lieu
thereof, the following:

 

Kayares
International LLC

Attn:  Renee K. Kwan, Managing Member

PO Box 117339

Burlingame, CA.  94011

Phone:  (415)439-5318

Facsimile:  (415) 439-5309

 

9.)            In the
event that any provision of this Amendment and any provision of the Lease are
inconsistent or conflicting, the inconsistent or conflicting provisions of this
Amendment shall be and constitute an amendment of the Lease and shall control,
but only to the extent that such provision is expressly inconsistent with the
Lease.  Except as expressly amended by
this Amendment, the Lease is in all respects ratified, confirmed and approved
and all the terms, provisions and conditions set forth in the Lease which are
not specifically modified by Amendment shall be and remain in full force and
effect.

 

10.)          This
Amendment may be executed in any number of counterparts, each of which when so
executed will be deemed an original, and all of which together, shall
constitute one and the same document.

 

11.)          In the
event that GEBPS does not consummate either (A) a purchase of the assets
of Lessee, including an assumption and assignment of the Lease as amended
herein, or (B) an acquisition of all of the stock of Lessee on or before June 1,
2003, this

 

3

 

Amendment
shall terminate on that date and be of no further force and effect, and Lessee
shall immediately vacate the Second Expansion Premises.

 

4

 

IN WITNESS
WHEREOF, and intending to be legally bound hereby, the duly authorized
representatives of Lessor and Lessee have executed this Amendment as of the
Effective Date.

 

	
   

  	
  “LESSOR”

  
	
   

  	
   

  
	
   

  	
  KAYARES INTERNATIONAL, LLC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ [illegible]

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
  Managing Member

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  26 February 2003

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  “LESSEE”

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ADVANCED TELCOM GROUP, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ [illegible]

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
  CEO

  
	
   

  	
   

  
	
   

  	
  Date:

  	
  2/26/03

  
							

 

5

 

Schedule 1

 

[Insert a diagram of the Second Expansion
Premises]

 

6

 

Schedule 2

 

Form of GEBPS Guaranty

 

7

 

GUARANTY
OF LEASE

 

Reference is
made to the Lease entered into between Kayares International, LLC, a California
limited liability company, as successor in interest to Old Courthouse Square,
LLC (“Lessor”) and Advanced TelCom Group, Inc.,
a Delaware corporation (“Lessee”)
effective as of January 29, 1999, as amended by Addendum One dated
effective as of January 19, 1999, Second Addendum to Lease dated effective
as of January 29, 1999, and the First Amendment to Lease dated August 12,
1999 (the First Addendum, the Second Addendum and the First Lease are
collectively referred to as the “Lease”) and the
Second Amendment to Lease entered into effective as of November 1, 2002,
between Lessor and Lessee (the “Amended Lease”).

 

In
consideration of the Amended Lease and conditioned on the terms specified
herein, GE Business Productivity Solutions, Inc. (“Guarantor”)
has agreed to execute this Guaranty.

 

1.             Limited Payment Guaranty.  Guarantor agrees to guaranty the prompt, full
and complete performance of all of the obligations of Lessee to pay rent and
expenses under the Amended Lease during a period commencing on the effective
date of this Guaranty until the earlier of:  (A) the purchase by Guarantor and/or any
of its affiliates (a “Guarantor Affiliate”) of a substantial portion of the
assets of Lessee (the “Assets”) pursuant to the Asset Purchase Agreement dated
as of June 21, 2002 as approved in Lessee’s bankruptcy case (the “Asset
Purchase Agreement”), or (B) a controlling equity interest in Lessee
through a chapter 11 reorganization plan approved by the bankruptcy court (the “Plan”);
or (C) the effective date of the rejection, by Lessee, of the Amended
Lease in Lessee’s bankruptcy case; or (D) Guarantor’s written notice to Lessor
that Guarantor and/or a Guarantor Affiliate has elected not to purchase the
Assets of Lessee, or a controlling equity interest in Lessee through a Plan
(such period being referred to herein as the “Guaranty
Period”).  If, at any time
during the Guaranty Period, Lessee fails to make any payment: under the Amended
Lease when due, Guarantor shall, upon written notice from Lessor and without
further demand, pay the same in the same manner and to the same extent as is
required of Lessee.  Notwithstanding the
foregoing, upon expiration of the Guaranty Period, the Guarantor shall be
released from its obligations under this Guaranty.

 

2.             Covenants Regarding Assumption
of Lease.

 

A.            Conditioned and effective upon
the closing of the acquisition by Guarantor and/or a Guarantor Affiliate of a
controlling equity interest: in Lessee through a Plan, Guarantor agrees that (A) Guarantor
shall cause Lessee to assume the Amended Lease, (B) Guarantor shall cause
Lessee not to assign the Amended Lease to any entity except Guarantor or a
Guarantor Affiliate, and (C) Guarantor guarantees to pay Lessor in full,
if such amounts are not paid by Lessee or its successor, any excess over the
rent and expenses under the Amended Lease collected by Lessee or its successor
from any assignee of the Amended Lease pursuant to assignment of the Amended
Lease under Section 365(f) of the Bankruptcy Code.

 

B.            In the event there is no closing
of the acquisition by Guarantor and/or a Guarantor Affiliate of a controlling
equity interest in Lessee through a Plan, and conditioned and effective upon
the closing of the acquisition by Guarantor and/or a Guarantor Affiliate of the
Assets of Lessee, Guarantor agrees that Guarantor and/or a Guarantor Affiliate
shall cause Lessee to assume the Amended Lease and shall assume all obligations
of Lessee under the Amended

 

1

 

Lease. 
[NM:  the sale order in effect now
authorizes GEBPS or its designated affiliate to assume the lease such that we
don’t believe a separate order is necessary]

 

3.             Waivers.  Guarantor understands and acknowledges that
the Amended Lease may, and likely will, be amended or modified from time to
time by agreement of Lessor and Lessee and that this may be done without notice
to or approval of Guarantor, it being understood that Guarantor is relying
solely on Lessee to protect its interests in connection with such matters.  Guarantor hereby waives any suretyship rights
or defenses that may be or become available to Guarantor by reason of Sections
2787 to 2855, inclusive, of the California Civil Code, and agrees that:

 

(a)           The Amended Lease may be
assigned, modified or amended in whole or in part or the Premises (as defined
in the Amended Lease) may be sublet in whole or in part without notice to
Guarantor and without releasing Guarantor or affecting Guarantor’s obligations
under this Guaranty in any way.

 

(b)           Lessor may, from time to time,
and without notice to Guarantor, release any security that Lessor may have for
the obligations of Lessee under the Amended Lease or accept security therefor;
add, substitute or release guarantors; or compromise or settle any amount due
or owing, or claimed to be owing under the Amended Lease; and no such action by
Lessor or any other action which Lessor may take or omit to take in connection
with the Amended Lease shall affect this Guaranty or Guarantor’s obligations in
any way.

 

(c)           Guarantor expressly waives
notice of acceptance of this Guaranty and diligence of collecting any sums due
under the Amended Lease or the taking of any action with reference to any
default under the Amended Lease or to any liability under this Guaranty.

 

(d)           Lessor has no duty to disclose
to Guarantor any information it receives regarding the financial status of
Lessee, whether or not such information indicates that the risk of Guarantor
under this Guaranty has been or may be increased.  Guarantor assumes full responsibility for
being and keeping informed of Lessee’s financial condition, Lessee’s
performance under the Amended Lease, and Lessee’s use and operation of the
Premises.

 

(e)           Guarantor hereby subordinates
all its claims for payment of any indebtedness of Lessee to Guarantor, if any,
to Lessor’s right to receive payment from Lessee of all sums due under the
Amended Lease and waives any rights it may have to participate in any security
for the Amended Lease or to enforce any remedy which Lessor may have against
Lessee or any other person or entity that may now or hereafter be liable on the
Amended Lease.

 

(f)            The obligations of Guarantor
under this Guaranty are independent of the obligations of Lessee, and Lessor
may directly enforce its rights under this Guaranty without proceeding against
or joining Lessee or any other guarantor of the Amended Lease, and without
applying or enforcing any security for the Amended Lease.

 

2

 

(g)           In the event any payment by
Lessee to Lessor is held to constitute a preference, fraudulent conveyance,
unauthorized transfer, or similar voidable payment under any law now or
hereafter in effect, and is rescinded or otherwise required to be returned by
Lessor, such payment by Lessee to Lessor shall not constitute a release of
Guarantor from any liability hereunder: and this Guaranty shall continue to be
effective or shall be reinstated, as the case may be, to the extent of any such
payment: or payments.

 

(h)           Guarantor agrees to indemnify
Lessor for all costs and expenses, including court costs and attorneys fees,
incurred or paid by Lessor in enforcing this Guaranty.

 

(i)            Guarantor specifically waives
any and all of the rights and defenses described in subdivision (a) of Section 2856
of the California Civil Code.

 

(j)            This Guaranty shall inure to
the benefit of any person or persons, entity or entities who at any time may be
entitled to the benefits and obligated to perform the duties of Lessor under
the Amended Lease and shall be binding upon the heirs, administrators,
successors and assigns of Guarantor.

 

(k)           This Guaranty is the final,
complete, and exclusive statement of the terms of the agreement between the
parties pertaining to Guarantor’s guarantee of the Amended Lease and supersedes
any and all prior or contemporaneous understandings, agreements,
representations or communications between or among the parties, either oral or
written, concerning this Guaranty.

 

(l)            This Guaranty shall be
construed in accordance with the fair meaning of the language used.  No rule of construction to the effect
that ambiguities are to be resolved against the drafting party shall apply in
interpreting this Guaranty.

 

(m)          This Guaranty may not be
changed orally, and no obligation of Guarantor can be released or waived except
by a writing signed by Lessor.

 

(n)           If any term or provision of
this Guaranty is ever determined to be illegal or unenforceable, all other
terms and provisions of this Guaranty shall remain effective and enforceable to
the fullest extent permitted by law.

 

(o)           This Guaranty and the rights
and obligations of Guarantor and Lessor under this Guaranty shall be governed
by and construed in accordance with the laws of the State of California,
excluding its conflicts of law principles.

 

4.             Notice.  Any notice required under this Guaranty shall
be given in writing and shall be deemed to have been delivered and given for
all purposes when (i) delivered by hand or to a designated e-mail address
(with written or electronic confirmation of receipt) before 5:00 p.m. on a
business day (or otherwise on the next succeeding business day); (ii) sent
by facsimile before 5:00 p.m. on a business day (or otherwise on the next
succeeding business day) and a written confirmation of the transmission is
received by the sender; or (iii) the next business day after being
deposited for delivery with a nationally recognized overnight delivery service,
such as Federal Express, and addressed or sent, as the case may be, to the
appropriate addresses or

 

3

 

facsimile numbers set forth below.  Either party may change its address for the
purpose of notice hereunder by providing the other party with notice of the new
address.

 

To Lessor:

 

Kayares
International, Inc.

50 California Street, Suite 1500

San Francisco, CA 94111

Attn: Renee Kwan, Managing Director

Fax: (415) 439-5309

 

To Guarantor:

 

GE Business
Productivity Solutions, Inc.

6540 Powers Ferry Road

Atlanta, Georgia 30339

Attention: General Counsel

Fax: (770) 644-7752

 

IN WITNESS
WHEREOF, this Guaranty has been executed by Guarantor, effective as of November 1,
2002.

 

GUARANTOR:

 

GE BUSINESS PRODUCTIVITY

SOLUTIONS, INC.

 

	
  By:

  	
  /s/David M. O’Neill

  	
   

  
	
   

  	
  Name:

  	
  David M. O’Neill

  	
   

  
	
   

  	
  Title:

  	
  EVP

  	
   

  
					

 

4EXHIBIT 10.26

 

LEASE

(Portion of Building in Park)

 

	
  Landlord:

  	
   

  	
  WVB HOLDINGS, LLC

  
	
   

  	
   

  	
   

  
	
  Tenant:

  	
   

  	
  ADVANCED TELCOM, INC.

  
	
   

  	
   

  	
   

  
	
  Premises:

  	
   

  	
  9,821 sq. ft. (usable) located at 463
  Aviation Boulevard, Oak

  Valley Business Center, Santa Rosa, CA

  

 

TABLE OF
CONTENTS

 

	
  Paragraph

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
  DEMISE; PREMISES:

  	
   

  
	
  2.

  	
  USE:

  	
   

  
	
  3.

  	
  TERM; POSSESSION:

  	
   

  
	
  4.

  	
  RENT:

  	
   

  
	
  5.

  	
  UTILITIES AND SERVICES:

  	
   

  
	
  6.

  	
  MAINTENANCE AND REPAIRS:

  	
   

  
	
  7.

  	
  ALTERATIONS:

  	
   

  
	
  8.

  	
  OPERATING EXPENSES AND TAXES:

  	
   

  
	
  9.

  	
  INSURANCE AND INDEMNITY:

  	
   

  
	
  10.

  	
  ASSIGNMENT AND SUBLETTING:

  	
   

  
	
  11.

  	
  PARKING:

  	
   

  
	
  12.

  	
  SUBORDINATION:

  	
   

  
	
  13.

  	
  DAMAGE OR DESTRUCTION:

  	
   

  
	
  14.

  	
  CONDEMNATION:

  	
   

  
	
  15.

  	
  ACCESS:

  	
   

  
	
  16.

  	
  DEFAULT BY TENANT; REMEDIES:

  	
   

  
	
  17.

  	
  ESTOPPEL CERTIFICATES:

  	
   

  
	
  18.

  	
  HOLDING
  OVER:

  	
   

  

 

 

	
  19.

  	
  SURRENDER:

  	
   

  
	
  20.

  	
  NOTICES:

  	
   

  
	
  21.

  	
  QUIET ENJOYMENT:

  	
   

  
	
  22.

  	
  RIGHT TO EXTEND:

  	
   

  
	
  23.

  	
  TENANT IMPROVEMENTS:

  	
   

  
	
  24.

  	
  NAME OF PARK OR BUILDING:

  	
   

  
	
  25.

  	
  HAZARDOUS SUBSTANCES:

  	
   

  
	
  26.

  	
  SIGNS:

  	
   

  
	
  27.

  	
  TRANSFER OF THE BUILDING BY LANDLORD:

  	
   

  
	
  28.

  	
  LIMITATION OF LIABILITY OF LANDLORD:

  	
   

  
	
  29.

  	
  LIENS:

  	
   

  
	
  30.

  	
  BROKERS:

  	
   

  
	
  31.

  	
  DEFAULT BY LANDLORD:

  	
   

  
	
  32.

  	
  ATTORNEYS’ FEES:

  	
   

  
	
  33.

  	
  COMPLIANCE WITH LAWS:

  	
   

  
	
  34.

  	
  RECORDING:

  	
   

  
	
  35.

  	
  MISCELLANEOUS PROVISIONS:

  	
   

  
	
  36.

  	
  NO
  OFFER:

  	
   

  

 

EXHIBITS

	
  A

  	
   

  	
  Floor Plan

  	
   

  	
  (Paragraph 1)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B

  	
   

  	
  Plot Plan

  	
   

  	
  (Paragraph 1)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C

  	
   

  	
  Rules and Regulations

  	
   

  	
  (Paragraph 1)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D

  	
   

  	
  Commencement Date Memorandum

  	
   

  	
  (Paragraph 3)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  E

  	
   

  	
  Parking Areas

  	
   

  	
  (Paragraph 11)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  F

  	
   

  	
  Tenant Improvements

  	
   

  	
  (Paragraph 23)

  

 

2

 

OAK
VALLEY BUSINESS CENTER

FULL SERVICE LEASE

(Portion of Building in Park)

 

THIS LEASE
(hereinafter called this “Lease”) is made and entered into as of the day of the
10th day of June, 2004, by and between WVB HOLDINGS, LLC, a
California limited liability company, as landlord (hereinafter called “Landlord”),
and ADVANCED TELCOM, INC., a Delaware corporation, as tenant (hereinafter called
“Tenant”).

 

WITNESSETH:

 

The parties
hereto hereby covenant and agree as follows:

 

1.                                       DEMISE; PREMISES:

 

(a)                                  Landlord does hereby lease and
demise to Tenant, and Tenant does hereby hire and take from Landlord, the
following described premises in the building located at and commonly known as
463 Aviation Blvd. (hereinafter called the “Building”), located in Oak Valley
Business Center (hereinafter called the “Park”) in the County of Sonoma and
State of California, to wit:  approximately
eleven thousand (11,000) rentable square feet of space and approximately nine
thousand eight hundred twenty-one (9,821) usable square feet of space on the
first floor, all as shown crosshatched on the floor plan(s) attached as EXHIBIT
“A” (hereinafter called the “Premises”); together with any and all
appurtenances, rights, privileges and easements pertaining thereto including,
but not limited to, the non-exclusive right to use in common with Landlord and
other occupants of the Building such elevators, stairways, corridors,
entranceways, rest rooms, walkways, roadways, driveways, loading docks, parking
facilities and other similar or related facilities as may exist in and about
the Building, Park and Land (as hereinafter defined) and that are designated by
Landlord for the general use, convenience or benefit of Tenant and other
tenants of the Building and the Park (hereinafter collectively called the “Common
Areas”).  Those Common Areas which are
for the exclusive use of occupants of the Building are hereinafter called “Building
Common Areas”, and those Common Areas which are for the use of all occupants of
the Park are hereinafter called “Park Common Areas”.  Landlord warrants and represents to Tenant
that (a) the Park consists of approximately ninety-one thousand (91,000) rentable
square feet of space and (b) the Building contains approximately forty
thousand (40,000) rentable square feet of space (with all measurements
determined in accordance with modified standards of the Building Owners and
Managers Association).  The parcel of
land upon which the Building is located is hereinafter referred to as the “Land.”
 A plot plan of the Park, Land, Building
and other improvements is attached as EXHIBIT “B”.  Landlord further represents and warrants that
Landlord is the fee owner of the Park and the Building, and has full right and
authority to lease the Premises to Tenant on the terms and conditions set out
herein.

 

(b)                                 Landlord reserves the right to (i) install,
use, maintain, repair, replace and relocate pipes, ducts, shafts, conduits,
wires, appurtenant meters and mechanical, electrical and plumbing equipment and
appurtenant facilities for service to other parts of the Building or Park above
the ceiling surfaces, below the floor surfaces and within the walls of the
Premises and in

 

 

the central core areas of the Building and in the Building Common
Areas, and to install, use, maintain, repair, replace and relocate any pipes,
ducts, shafts, conduits, wires, appurtenant meters and mechanical, electrical
and plumbing equipment and appurtenant facilities servicing the Premises, which
are located either in the Premises or elsewhere outside of the Premises; (ii) change
the boundary lines of the Park; (iii) alter or relocate the Common Areas, (iv) designate
and/or redesignate specific parking spaces in the Park for the exclusive or
non-exclusive use of specific tenants in the Park; and (v) perform such
other acts and make such other changes in, to or with respect to the Common
Areas, Building and/or Park as Landlord may reasonably deem appropriate; so
long as Tenant’s use, occupancy and access to the Premises is not materially
and adversely impacted as a result of any such changes.

 

(c)                                  All Common Areas shall be
subject to the exclusive control and management of Landlord and Landlord shall
have the right to establish, modify, amend and enforce reasonable rules and
regulations with respect to the Common Areas.  Tenant acknowledges receipt of a copy of the
current rules and regulations (the “Rules”) attached hereto as EXHIBIT “C”,
and agrees that they may, from time to time, be modified or amended by Landlord
in a commercially reasonable manner.  Tenant
agrees to abide by and conform with the Rules; to cause its concessionaires and
its and their employees and agents to abide by the Rules; and to use its best
efforts to cause its customers, invitees and licensees to abide by the Rules.  Notwithstanding the foregoing, Landlord shall
not establish, amend or modify any rule or regulation which will
materially and adversely impact Tenant’s use, occupancy and access to the
Premises and Common Areas without the prior written consent of Tenant, which
consent shall not be unreasonably withheld.

 

2.                                       USE:

 

Tenant may use
the Premises solely for office, administrative and research and development
uses (“Tenant’s Intended Use”) and for no other use without Landlord’s prior
written consent.  Tenant shall, at Tenant’s
expense, comply promptly with all applicable federal, state and local laws,
regulations, ordinances, rules, orders, and requirements in effect during the
Term relating to the condition, use or occupancy of the Premises.  Tenant shall not use or permit the use of the
Premises in any manner that will tend to create waste or a nuisance, or that
unreasonably disturbs other tenants of the Building or Park, nor shall Tenant
place or maintain any signs, antennas, awnings, lighting or plumbing fixtures,
loudspeakers, exterior decoration or similar devises on the Building or the
Park or visible from the exterior of the Premises without Landlord’s prior
written consent, which consent may be withheld in Landlord’s sole discretion.

 

3.                                       TERM; POSSESSION:

 

(a)                                  The initial term of this Lease
(the “Initial Term”) is for a period of three (3) Lease Years commencing
on the date (the “Commencement Date”) the Premises are delivered to Tenant in “substantially
completed” condition (as defined in Paragraph 23), subject to adjustment for
Tenant Delays (defined below), and shall continue until midnight on the last
day of the third Lease Year (the “Expiration Date”), unless extended or sooner
terminated as hereinafter provided.  The
Initial Term, together with each and every “Extended Term” (as defined in
Paragraph 22 hereof) which shall be duly exercised by Tenant pursuant to the
provisions of Paragraph 22, are hereinafter collectively called the “Term”.  The estimated

 

2

 

Commencement Date is August 1, 2004 (the “Estimated Commencement
Date”).  Landlord shall deliver
possession of the Premises to Tenant free and clear of all tenancies and
occupancies, broom clean and in good order and condition and with all
alterations and improvements, if any, to be made by Landlord as may be
elsewhere provided for in this Lease, substantially completed in a first-class
workmanlike manner.  If for any reason
Landlord has not delivered to Tenant possession of the Premises by the
Estimated Commencement Date, this Lease shall remain in effect and Landlord
shall not be liable to Tenant for any loss or damage resulting therefrom,
except as otherwise provided herein.

 

(b)                                 For purposes of this Lease, the
first “Lease Year” shall mean the period commencing on the Commencement Date
and ending twelve (12) months thereafter, except that if the Commencement Date
is other than the first day of a calendar month, the first “Lease Year” shall
mean the period commencing on the Commencement Date and ending on the last day
of the twelfth (12th) full calendar month after the Commencement Date.  Thereafter, the term “Lease Year” shall mean
a period equal to twelve (12) full calendar months, except that if the
Commencement Date is other than the first day of a calendar month the final “Lease
Year” shall be extended as necessary to ensure that the Lease expires at the
end of the Term.

 

(c)                                  If the Commencement Date of the
Lease has not occurred on or before the Estimated Commencement Date, and if the
cause of the delay in the occurrence of the Commencement Date is solely
attributable to Tenant, then the Lease shall begin on the date the Commencement
Date otherwise would have occurred but for the Tenant delays (“Tenant Delays”).  Tenant Delays shall include, without
limitation, those caused by (a) any changes to the Work (defined in
Paragraph 23) requested by Tenant, and (b) Tenant’s or Tenant’s agents’
interference with Landlord’s performance of the Work.  All costs and expenses occasioned by a Tenant
Delay, including, without limitation, increases in labor or materials, shall be
borne by Tenant.

 

(d)                                 Following the date on which
Landlord delivers possession of the Premises to Tenant and the Commencement
Date, Landlord may prepare and deliver to Tenant a commencement date memorandum
(the “Commencement Date Memorandum”) in the form of EXHIBIT “D”, attached
hereto, subject to such changes in the form as may be required to insure the
accuracy thereof.  The Commencement Date
Memorandum shall certify the date on which Landlord delivered possession of the
Premises to Tenant and the dates upon which the Term commences and expires.

 

4.                                       RENT:

 

(a)                                  Tenant shall pay to Landlord the
monthly rental (herein called “Base Rent”) for the Premises in the amounts
specified in the Addendum, attached hereto and made a part hereof.  Tenant shall pay to Landlord the Base Rent,
in advance, on the 1st day of each and every calendar month during the Term of
this Lease, without notice or demand and without any set-off or deduction,
except to the extent otherwise expressly provided for in this Lease.  If the Term commences on other than the first
day of a calendar month, the first payment of Base Rent shall be appropriately
prorated on the basis of the number of days in such calendar month.  All Rent due or to become due hereunder shall
be paid to Landlord at its address set forth in this Lease, unless Landlord
shall designate some other payee or address for the payment thereof by

 

3

 

giving written notice to that effect to Tenant.  For purposes of this Lease, the term “Rent”
shall mean the Base Rent, all additional rent and all of the other monetary
obligations of Tenant under this Lease.

 

(b)                                 Tenant shall pay, as additional
rent, all amounts of money required to be paid to Landlord by Tenant under this
Lease in addition to monthly Base Rent whether or not the same is designated “additional
rent.” Tenant shall pay to Landlord all additional rent upon Landlord’s written
request or otherwise as provided in this Lease.

 

(c)                                  Tenant acknowledges that late
payment of Rent to Landlord will cause Landlord to incur costs not contemplated
by this Lease, the exact amount of which is extremely difficult to ascertain.  Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be imposed on
Landlord by the terms of any trust deed covering the Premises.  Accordingly, if any installment of Rent or
any other sums due from Tenant shall not be received by Landlord within ten (10) days
after the date such payment is due, Tenant shall pay to Landlord a late charge
in an amount equal to two percent (2%) of such overdue amount.  The parties agree that such late charge
represents a fair and reasonable estimate of the costs Landlord will incur by
reason of late payment by Tenant.  Acceptance
of such late charge by Landlord shall not constitute a waiver of Tenant’s
default with respect to such overdue amount, nor prevent Landlord from
exercising any of the other rights and remedies granted hereunder.

 

5.                                       UTILITIES AND SERVICES:

 

(a)                                  Landlord shall furnish the
following utilities and services in and to the Premises, to wit:  (i) heat and air-conditioning (“HVAC”) as
may be required to maintain the Premises at reasonably comfortable temperatures
during business hours as hereinafter defined; (ii) hot and cold water; (iii) adequate
elevator service as may be reasonably required; (iv) janitorial service; (v) electricity
in amounts reasonably required for Tenant’s Intended Use; and (vi) adequate
sewer systems (storm and sanitary).  Business
hours shall be between the hours of 7:00 A.M. and 6:00 P.M. Monday
through Friday, excluding State and National holidays.  Upon request of Tenant, Landlord shall
furnish such utilities and services in excess of the above requirements and/or
outside of business hours, but only to the extent that same are available and
only if Tenant agrees to pay the additional cost thereof.  The current after business hours HVAC charge
is Twenty-Five Dollars ($25.00) per hour.

 

(b)                                 To the extent that any utility
is separately furnished and metered to the Premises as of the Commencement
Date, Tenant shall be solely responsible for and promptly pay all charges for
such separately metered utility as they are billed to Tenant by the utility
company supplying same.  Tenant shall not
be required to install or pay the cost of installation of a separate meter.

 

6.                                       MAINTENANCE AND REPAIRS:

 

(a)                                  Landlord shall maintain and keep
in a state of good condition and repair the roof structure, the structural
parts of the Building and other portions of the Building not the responsibility
of Tenant hereunder, the foundation, all load-bearing walls, exterior windows,
the

 

4

 

electrical and lighting systems (other than in the Premises, except any
electrical wiring within the walls, ceiling or floor shall be the maintenance
obligation of Landlord), pipes and plumbing (other than in the Premises, except
any pipes or plumbing within the walls, ceiling or floor shall be the
maintenance obligation of Landlord), storm and sanitary sewer systems,
ventilating system, heating and air conditioning units and/or systems, elevators,
stairs and halls, loading doors, the grounds (including landscaping, parking
areas, walkways, roadways and driveways) and all necessary apparatus,
accessories and fixtures pertaining to the Park, Land and Building; however any
such repairs which are required by reason of any waste, misuse or negligence on
the part of Tenant and which are not covered by insurance required to be
carried by Landlord pursuant to Paragraph 9.3 hereof, shall be made by Landlord
at the expense of Tenant.  The term “repair”
shall include replacement as necessary.  Landlord
shall also keep the parking areas, driveways, roadways and walkways reasonably
clear of ice and snow.  Tenant expressly
waives the benefits of any statute, including Civil Code Sections 1941 and
1942, which would afford Tenant the right to make repairs at Landlord’s expense
or to terminate this Lease due to Landlord’s failure to keep the Building in
good order, condition and repair.  Landlord
shall have no liability to Tenant for any damage, inconvenience or interference
with the use of the Premises by Tenant as the result of Landlord performing any
such maintenance and repair work.

 

(b)                                 Tenant shall, at Tenant’s
expense, maintain every part of the Premises in good order, condition and
repair, including without limitation, (i) all interior surfaces, ceilings,
non-load bearing walls, door frames, window frames, floors, carpets, draperies,
window coverings and fixtures, (ii) all windows, doors, locks and closing
devices, entrances and signs, (iii) all plumbing and sewage pipes (except
to the extent otherwise provided for hereinabove), fixtures and fittings in the
Premises, (iv) all phone lines, electrical wiring, equipment, switches,
outlets and light bulbs in the Premises, (v) all of Tenant’s personal
property, improvements and alterations, and (vi) all other fixtures and
special items installed by or for the benefit of, or at the expense of Tenant.  Tenant shall not enter onto the roof area of
the Building.  Tenant shall not commit
any waste on or to the Premises and shall keep the Premises in a clean, neat
and orderly condition except to the extent Landlord is required to do so
pursuant to subparagraph (a) above or subparagraph 5(a).

 

(c)                                  All repairs and replacements to
be made pursuant to the provisions of this Paragraph 6 shall be made within a
reasonable time (depending on the nature of the required repair or replacement)
after the party who is obligated to make such repair or replacement has actual
or constructive notice of the necessity for such repair or replacement.

 

7.                                       ALTERATIONS:

 

Tenant may not
make any alterations, installations and changes (hereinafter collectively
called “Alterations”) in, on and to the interior of the Premises without
Landlord’s prior written consent, which consent shall not be unreasonably
withheld or delayed.  Notwithstanding the
foregoing, Tenant may make Alterations without Landlord’s prior written consent
where (i) the reasonably estimated cost of the Alteration and together
with the cost of any other Alteration made during the immediately preceding
twelve (12) months does not exceed Fifteen Thousand Dollars ($15,000), and (ii) such
Alterations do not affect or involve the structural integrity, roof membrane,
exterior areas, building systems or water-tight nature of the Premises,
Building or Park.  All such work shall be
done in a good and workmanlike manner and

 

5

 

in accordance with all applicable laws. 
Tenant may remove any or all interior and non-structural Alterations and
any signage (whether or not interior or non-structural) from the Premises at
any time prior to the expiration of the Term, provided that any damage caused
by such removal shall be repaired by Tenant. 
Landlord, by written notice at the time consent for such Alteration is
given, may require that Tenant, at Tenant’s expense, remove any Alterations
prior to or upon the expiration of this Lease, and restore the Premises to
their condition prior to such Alterations. 
Unless Landlord requires their removal, as provided above, all
Alterations made to the Premises shall become the property of Landlord and
remain upon and be surrendered with the Premises upon the expiration of this
Lease.

 

8.                                       OPERATING
EXPENSES AND TAXES:

 

8.1.                              Operating Expenses.

 

(a)                                  Obligation
to Pay Operating Expenses.  Tenant
shall pay to Landlord as additional rent during the Term (i) Tenant’s
Building Percentage Share of any increase in Operating Expenses attributable to
the ownership, operation, repair and/or maintenance of the Building over the
Base Operating Expenses attributable to the Building and (ii) a portion of
any increase in Operating Expenses attributable to the ownership, repair and
maintenance of the Park over the Base Operating Expenses for the Park as
reasonably determined by Landlord.  Landlord
has the right to allocate certain Operating Expenses incurred in connection
with the ownership, operation, repair and/or maintenance of the Park to one or
more particular buildings within the Park to the extent Landlord determines
that it is reasonable to do so based upon the nature or the expense and
pursuant to generally accepted accounting principles.

 

(b)                                 Defined
Terms.  For purposes of this Lease,
the following terms are defined as follows:

 

(i)                                     “Tenant’s
Building Percentage Share” shall mean the percentage equal to the rentable
square footage of the Premises divided by the rentable square footage of the
Building (i.e., 11,000 rsf / 40,000 rsf = 25.5%),

 

(ii)                                  “Tenant’s
Park Percentage Share” shall mean the percentage equal to the rentable square
footage of the Premises divided by the rentable square footage of the Park
(i.e., 11,000 rsf / 91,000 rsf = 12.09%),

 

(iii)                               “Base
Operating Expenses” shall mean those Operating Expenses incurred by Landlord
during the Base Year,

 

(iv)                              “Base
Year” shall mean the 2004 calendar year, and

 

(v)                                 “Operating
Expenses” shall mean all expenses and costs of every kind and nature which
Landlord shall pay or become obligated to pay because of or in connection with
the ownership, operation, repair and/or maintenance of the Building, Common
Areas and/or Park, the surrounding property, and the supporting facilities,
including, without limitation:  (A) all
maintenance, janitorial and security costs, (B) costs for all materials,
supplies and equipment; (C) all costs of water, heat, gas power,
electricity, refuse collection, parking lot

 

6

 

sweeping, landscaping, and
other utilities and services provided to the Building and the Common Areas; (D) all
property management expenses, including, without limitation, all property
management fees and all expense and cost reimbursements not to exceed Five
percent (5%) of Base Rent, (E) all costs of alterations or improvements to
the Building or Common Areas made to achieve compliance with federal, state and
local law including, without limitation, the Americans with Disabilities Act
(42 U.S.C. Section 12101 et seq.), or to reduce Operating Expenses or
improve the operating efficiency of the Building, all of which costs will be
amortized over the useful life of the expenditure, as reasonably determined by
Landlord; (F) premiums for insurance maintained by Landlord pursuant to
this Lease or with respect to the Building or the Land; (G) costs for
repairs, replacements, uninsured damage or insurance deductibles and general
maintenance of the Building, Common Areas and Land, but excluding any repairs
or replacements paid for out of insurance proceeds or by other parties; (H) all
costs incurred by Landlord for making any capital repairs or replacements to
the Building or Common Areas (as distinguished from capital improvements to the
Building which shall not be an Operating Expense except as otherwise expressly
provided above), which costs will be amortized over the useful life of such
capital expenditure as reasonably determined by Landlord; and (I) all costs of
maintaining machinery, equipment and directional signage or other markers.

 

Notwithstanding
the foregoing, the term “Operating Expenses” shall not include any repairs to
or replacements of the structural components of the Building (including the
structural components of the roof, but excluding the roof membrane) and the
foundation.

 

(c)                                  Less
Than Full Occupancy.  If the Building
or the Park are less than ninety-five percent (95%) occupied during any year of
the Term, Operating Expenses for each such calendar year shall be adjusted to
equal Landlord’s reasonable estimate of Operating Expenses as though
ninety-five percent (95%) of the total rentable area of the Building and/or the
Park as applicable had been occupied.

 

(d)                                 Estimates
of Operating Expenses.  Tenant shall
pay to Landlord each month at the same time and in the same manner as monthly
Base Rent one-twelfth (1/12th) of Landlord’s estimate of the amount of
Operating Expenses payable by Tenant for the then-current calendar year.  If at any time it appears to Landlord that
Tenant’s share of Operating Expenses payable for the current calendar year will
vary from Landlord’s estimate, Landlord may give notice to Tenant of Landlord’s
revised estimate for the calendar year, and subsequent payments by Tenant for
the calendar year shall be based on the revised estimate.  Within one hundred twenty (120) days after
the close of each calendar year, or as soon after such 120-day period as
practicable, Landlord shall deliver to Tenant a statement in reasonable detail
of the actual amount of Operating Expenses payable by Tenant for such calendar
year.  Landlord’s failure to provide such
statement to Tenant within the 120-day period shall not act as a waiver
and shall not excuse Tenant or Landlord from making the adjustments to reflect
actual costs as provided herein.  If on
the basis of such statement Tenant owes an amount that is less than the
estimated payments for such calendar year previously made by Tenant, Landlord
shall credit such excess against the next payment of Operating Expenses due.  If on the basis of such statement Tenant owes
an amount that is more than the estimated payments for such calendar year
previously made by Tenant, Tenant shall pay the deficiency to Landlord within
fifteen (15) business days after delivery of the statement.  In addition, if, after the end of any
calendar year or

 

7

 

any annual adjustment of
Operating Expenses for a calendar year, Operating Expenses are incurred or
billed to Landlord that are attributable to any period within the Term (e.g.,
sewer district flow fees), Landlord shall notify Tenant of its share of such
additional Operating Expenses and Tenant shall pay such amount to Landlord
within ten (15) business days after Landlord’s written request therefor.  The obligations of Landlord and Tenant under
this Paragraph with respect to the reconciliation between the estimated and
actual amounts of Operating Expenses payable by Tenant for the last year of the
Term shall survive the termination of this Lease.  Landlord shall keep and maintain complete and
accurate books and records reflecting such Operating Expenses and Taxes for a
period of at least two (2) years following the period in which Operating
Expenses and Taxes were incurred.  Tenant
or its representatives shall have one hundred twenty (120) days from after
Tenant receives the year-end statement of the adjustment to the Operating
Expenses for the prior calendar year to notify Landlord in writing of Tenant’s
desire to conduct, at Tenant’s sole cost and expense, an audit of Landlord’s
books and records relating to the prior calendar year.  Any such audit must be conducted by Tenant or
its agent during regular business hours at the offices of Landlord or the
offices of Landlord’s designated agent and must be completed within one hundred
fifty (150) days after Tenant receives the applicable year-end statement.  The person or entity performing the audit or
review of Landlord’s books and records on Tenant’s behalf or at Tenant’s
request may not be compensated for the audit or review on a contingency fee
basis.  Any payment of Additional Rent by
Tenant shall be made without prejudice to any right of Tenant to dispute any
item theretofore billed pursuant to the provisions of this subparagraph (d).

 

8.2.                              Taxes.

 

(a)                                  Tenant
shall pay to Landlord, as additional rent, Tenant’s Park Percentage Share of
any increase in Taxes for the Park over Base Taxes during each year of the Term
(prorated for any partial calendar year during the Term).  The term “Base Taxes” shall mean those taxes
incurred by Landlord during the Base Year.

 

(b)                                 Definition
of Taxes.  The term “Taxes” shall
include all transit charges, housing fund assessments, real estate taxes and
all other taxes relating to the Premises, Building and Park of every kind and
nature whatsoever, including any supplemental real estate taxes attributable to
any period during the Term; all taxes which may be levied in lieu of real
estate taxes; and all assessments, assessment bonds, levies, fees, penalties
(if a result of Tenant’s delinquency) and other governmental charges
(including, but not limited to, charges for parking, traffic and any storm
drainage/flood control facilities, studies and improvements, water and sewer
service studies and improvements, and fire services studies and improvements); and
all amounts necessary to be expended because of governmental orders, whether
general or special, ordinary or extraordinary, unforeseen as well as foreseen,
of any kind and nature for public improvements, services, benefits or any other
purpose, which are assessed, based upon the use or occupancy of the Premises,
Building and/or Park, or levied, confirmed, imposed or become a lien upon the
Premises, Building and/or Park, or become payable during the Term, and which
are attributable to any period within the Term and not solely attributable to
the use of any other tenant in the Building or Park.

 

(c)                                  Limitation.  Nothing contained in this Lease shall require
Tenant to pay (i) any franchise, estate, inheritance, succession or
transfer tax of Landlord, (ii) for any

 

8

 

increase in taxes resulting
from a change of ownership of the Land or the Building, or (iii) any
income, profits or revenue tax or charge upon the net income of Landlord from
all sources; provided, however, that if at any time during the Term in under
the laws of the United States Government or the State of California, or any political
subdivision thereof, a tax or excise on rent, or any other tax however
described, is levied or assessed by any such political body against Landlord on
account of Rent, or any portion thereof, Tenant shall pay one hundred percent
(100%) of any said tax or excise as additional rent.

 

(d)                                 Installment
Election.  In the case of any Taxes
which may be evidenced by improvement or other bonds or which may be paid in
annual or other periodic installments, Landlord shall elect to cause such bonds
to be issued or such assessment to be paid in installments over the maximum
period permitted by law.

 

(e)                                  Estimate
of Tenant’s Share of Taxes.  Prior to
the commencement of each calendar year during the Term, or as soon thereafter
as reasonably practicable, Landlord shall notify Tenant in writing of Landlord’s
estimate of the amount of Taxes which will be payable by Tenant for the ensuing
calendar year.  On or before the first
day of each month during the ensuing calendar year, Tenant shall pay to
Landlord in advance, together with Base Rent, one-twelfth (1/12th) of the
estimated amount; provided, however, if Landlord fails to notify Tenant of the
estimated amount of Tenant’s share of Taxes for the ensuing calendar year prior
to the end of the current calendar year, Tenant shall be required to continue
to pay to Landlord each month in advance Tenant’s estimated share of Taxes on
the basis of the amount due for the immediately prior month until twenty (20)
days after Landlord notifies Tenant of the estimated amount of Tenant’s share
of Taxes for the ensuing calendar year.  If
at any time it appears to Landlord that Tenant’s share of Taxes payable for the
current calendar year will vary from Landlord’s estimate, Landlord may give
notice to Tenant of Landlord’s revised estimate for the year, and subsequent
payments by Tenant for the year shall be based on the revised estimate.

 

(f)                                    Annual
Adjustment.  Within one hundred
twenty (120) days after the close of each calendar year during the Term, or as
soon after the one hundred twenty (120) day period as reasonably practicable,
Landlord shall deliver to Tenant a statement of the adjustment to the Taxes for
the prior calendar year.  If, on the
basis of the statement, Tenant owes an amount that is less than the estimated
payments for the prior calendar year previously made by Tenant, Landlord shall
apply the excess to the next payment of Taxes due.  If, on the basis of the statement, Tenant
owes an amount that is more than the amount of the estimated payments made by Tenant
for the prior calendar year, Tenant shall pay the deficiency to Landlord within
thirty (30) days after delivery of the statement.  The year end statement shall be binding upon
Tenant unless Tenant notifies Landlord in writing of any objection thereto
within thirty (30) days after Tenant’s receipt of the year end statement.  In addition, if, after the end of any
calendar year or any annual adjustment of Taxes for a calendar year, any Taxes
are assessed or levied against the Premises, Building or Building that are attributable
to any period within the Term (e.g., supplemental taxes or escaped taxes),
Landlord shall notify Tenant of its share of such additional Taxes and Tenant
shall pay such amount to Landlord within twenty (20) days after Landlord’s
written request therefor.

 

(g)                                 Personal
Property Taxes.  Tenant shall pay or
cause to be paid, any and all taxes and assessments levied upon all of Tenant’s
trade fixtures, inventories and other

 

9

 

personal property in, on or
about the Premises.  When possible,
Tenant shall cause Tenant’s personal property to be assessed and billed
separately from the real or personal property of Landlord.  On request by Landlord, Tenant shall furnish
Landlord with satisfactory evidence of payment of Tenant’s business personal
property taxes and deliver copies of such business personal property tax bills
to Landlord.

 

9.                                       INSURANCE AND INDEMNITY:

 

9.1.                              Tenant’s Insurance.  Tenant, at its sole cost and expense, shall
obtain and maintain in effect as long as this Lease remains in effect and
during such other time as Tenant occupies the Premises or any part thereof,
insurance policies providing at least the following coverages:

 

(a)                                  general
liability insurance, in occurrence form, insuring Tenant against any and all
liability for injury to or death of a person or persons, and for damage to or
destruction of property, occasioned by or arising out of or in connection with
the use or occupancy of the Premises or the business operated by Tenant thereon,
and including contractual liability coverage for Tenant’s indemnity obligations
under this Lease (other than those contained in Paragraph 25 hereof), to afford
protection with a minimum combined single limit of liability of at least Three
Million Dollars ($3,000,000); and

 

(b)                                 worker’s
compensation and similar insurance offering statutory coverage and containing
statutory limits and employer’s liability insurance in form and amount deemed
reasonable by Tenant in the exercise of its prudent business judgment.

 

Such policies
will be maintained in companies having a “General Policyholders Rating” of at
least B plus as set forth in the most current issue of “Best’s Insurance Guide”,
and will be written as primary policy coverage and not contributing with, or in
excess of, any coverage which Landlord shall carry.  Tenant shall deposit certificates of such
required insurance with Landlord prior to the earlier to occur of (x) the
Commencement Date of this Lease, or (y) Tenant’s occupancy of the Premises,
which certificates shall contain a provision stating that such policy or
policies shall not be canceled or materially altered except after thirty (30)
days’ written notice to Landlord.  Tenant
shall have the right to provide the coverages required herein under blanket
policies provided that the coverage afforded shall not be diminished by reason
thereof.

 

9.2.                              Tenant’s Property.  All furnishings, fixtures, equipment, and
property of every kind and description of Tenant and of persons claiming by or
through Tenant which may be on the Premises shall be at the sole risk and
hazard of Tenant and no part of loss or damage thereto for whatever cause is to
be charged to or borne by Landlord.

 

9.3.                              Landlord’s Insurance.  Landlord, at its sole cost and expense, shall
obtain and maintain in effect as long as this Lease remains in effect,
insurance policies providing at least the following coverages:

 

(a)                                  general
liability insurance, in occurrence form, insuring Landlord against any and all
liability for injury to or death of a person or persons, and for damage to or
destruction of property, occasioned by or arising out of or in connection with
the ownership or

 

10

 

management of the Park, Land
and Building, and including contractual liability coverage for Landlord’s
indemnity obligations under this Lease (other than those contained in Paragraph
25 hereof), to afford protection with a minimum combined single limit of
liability of at least Three Million Dollars (83,000,000);

 

(b)                                 standard
all-risk property and casualty insurance, insuring the Building and all other
improvements on the Land against those risks normally encompassed in an
all-risk policy, as well as such other risks as a reasonably prudent owner of
similar commercial buildings in the locality where the Building is located
would normally insure against, such insurance to provide for the payment of
full replacement cost in the event of a total destruction of the Building and
other improvements so as to ensure the availability of sufficient funds to
repair and restore the Building and other improvements to their condition
immediately prior to any damage or destruction; and

 

(c)                                  Landlord
may maintain rent insurance, for the benefit of Landlord, equal to at least one
year’s Base Rent hereunder.  If this
Lease is terminated as a result of damage by fire, casualty or earthquake, all
insurance proceeds shall be paid to and retained by Landlord, subject to the
rights of any authorized encumbrancer of Landlord.

 

9.4.                              Waiver of Recovery.  Neither Landlord nor Tenant shall be liable
to the other or to any insurance company insuring the other party (by way of
subrogation or otherwise) for any loss or damage to any structure, building, or
other tangible property, or any resulting loss of income, even though such
damage or loss might have been occasioned by the negligence of Landlord or
Tenant or any of their agents or employees, if any such loss or damage is
covered by insurance benefiting the party suffering such loss or damage or was
required of such party to be covered by insurance pursuant to this Lease.

 

9.5.                              Indemnity.  Except if and to the extent that such party
is released from liability to the other party hereto pursuant to the provisions
of Paragraph 9.4 above,

 

(a)                                  Landlord
does hereby assume liability for, and does hereby agree to indemnify, protect,
defend, save and hold harmless Tenant and its officers, directors, agents and
employees, from and against any and all liabilities, obligations, claims,
actions, demands, fines, suits, judgments, penalties, damages and losses
(including all of the costs, fees and expenses connected therewith or incident
thereto) for death of or injury to any person whomsoever and for loss of,
damage to, or destruction of any property whatsoever (including loss of use
thereof) arising out of the negligence or willful misconduct of Landlord and
its officers, partners, employees, agents, representatives or contractors
(collectively, “Landlord’s Parties”) as they relate to the Park, Land, Building
and/or the Premises; and

 

(b)                                 Tenant
does hereby assume liability for, and does hereby agree to indemnify, protect,
defend, save and hold harmless Landlord, its officers, directors, agents and
employees, from and against any and all liabilities, obligations, claims,
actions, demands, fines, suits, judgements, penalties, damages and losses
(including all of the costs, fees and expenses connected therewith or incident
thereto) for death of or injury to any person whomsoever and for loss of,
damage to, or destruction of any property whatsoever (including loss of use
thereof) arising out of (i) any condition or occurrence in or resulting
from any condition or occurrence in

 

11

 

the Premises during the Term,
except to the extent caused by the negligence or willful misconduct of Landlord
or Landlord’s Parties, or (ii) any act or omission of Tenant or Tenant’s
agents, representatives, officers, directors, shareholders, partners,
employees, successors and assigns, wherever it occurs.

 

(c)                                  The
provisions of this Paragraph shall survive the termination or expiration of
this Lease with respect to any damage, injury, or death occurring prior to such
expiration or termination.

 

10.                                 ASSIGNMENT
AND SUBLETTING:

 

(a)                                  Assignment and Subletting.  Tenant shall not assign this Lease or sublet
all or any portion of the Premises without the prior written consent of
Landlord, which consent shall not be unreasonably withheld or delayed.  Notwithstanding the foregoing, however,
Tenant may assign this Lease or sublet all or any portion of the Premises
without Landlord’s prior written consent to any corporation which is directly
or indirectly controlled by or under common control with Tenant or to any
entity which shall acquire a business segment of Tenant which conducts
operations at the Premises.  No
assignment or subletting shall release Tenant from any of its obligations or
liabilities under this Lease.  Any
purported assignment or subletting contrary to the provisions of this Lease
without Landlord’s prior written consent shall be void.  The consent by Landlord to any assignment or
subletting shall not constitute a waiver of the necessity for obtaining
Landlord’s consent to any subsequent assignment or subletting.  Landlord may consent to any subsequent
assignment or subletting, or any amendment to or modification of this Lease
with the assignees of Tenant, without notifying Tenant or any successor of
Tenant, and without obtaining its or their consent thereto, and such action
shall not relieve Tenant or any successor of Tenant of any liability under this
Lease.

 

(b)                                 Information to be Furnished.  If Tenant desires at any time to assign its
interest in this Lease or sublet the Premises, Tenant shall first notify
Landlord of its desire to do so and shall submit in writing to Landlord:  (i) the name of the proposed assignee or
subtenant; (ii) the nature of the proposed assignee’s or subtenant’s
business to be conducted in the Premises; (iii) the terms and provisions
of the proposed assignment or sublease, including the date upon which the
assignment shall be effective or the commencement date of the sublease and a
copy of the proposed form of assignment or sublease; and (iv) such
financial information, including financial statements, and other information as
Landlord may reasonably request concerning the proposed assignee or subtenant.

 

(c)                                  Bonus Rental.  If, in connection with any assignment or
sublease, Tenant receives rent or other consideration, either initially or over
the term of the assignment or sublease, in excess of the Rent called for
hereunder, or in case of the sublease of a portion of the Premises, in excess
of such Rent fairly allocable to such portion, Tenant shall pay to Landlord, as
additional rent hereunder, fifty percent (50%) of the excess of each such
payment of Rent or other consideration received by Tenant after deducting all
of the costs of subletting or assigning the space including, but not limited to
broker’s commissions, rent concessions, improvement allowances, attorneys fees
and costs, promptly after Tenant’s receipt of such Rent or other consideration.

 

12

 

(d)                                 Transfer of a Majority Interest.  If Tenant is a non-publicly traded
corporation, the transfer (as a consequence of a single transaction or any
number of separate transactions) of fifty percent (50%) or more or of a
controlling interest or the beneficial ownership interest of the voting stock
of Tenant issued and outstanding as of the date of this Lease shall constitute
an assignment hereunder for which Landlord’s prior written consent is required.  If Tenant is a partnership, limited liability
company, trust or an unincorporated association, the transfer of a controlling
or majority interest therein shall constitute

 

11.                                 PARKING:

 

Landlord
grants to Tenant and Tenant’s customers, suppliers, employees and invitees
during the Term the right to use in the parking areas designated on EXHIBIT “E”
thirty-seven (37) parking spaces on a non-exclusive basis for the use of motor
vehicles, subject to rights reserved to Landlord as specified herein.  Landlord reserves the right to grant similar
nonexclusive rights to other tenants; to promulgate rules and regulations
relating to the use of the including parking area; to make changes in the parking
layout from time to time; and to do and perform any other acts in and to these
areas and improvements as Landlord determines to be advisable.  Landlord shall have the unqualified right to
rearrange or reduce the number of parking spaces; provided, however, the ratio
of the number of parking spaces available to Tenant will be no less than 3.8
spaces per 1,000 usable square feet of the Premises.

 

12.                                 SUBORDINATION:

 

Tenant agrees
upon request of Landlord to subordinate this Lease and its rights hereunder to
the lien of any mortgage, deed of trust or other voluntary hypothecation
arising out of any security instrument duly executed by Landlord charged
against the Land, Building and Premises, or any portion or portions thereof,
and to execute at any time and from time-to-time such documents as may be
reasonably required to effectuate such subordination; provided, however, that
Tenant shall not be required to effectuate any such subordination or other
document hypothecating any interest in the Land, Building or Premises unless
the mortgagee or beneficiary named in such mortgage or deed of trust (the “Holder”)
shall first enter into Holder’s commercially reasonable standard form of
Subordination, Non-Disturbance and Attornment Agreement which provides that Holder
shall not disturb Tenant’s quiet enjoyment of the Premises or terminate or
cancel any of Tenant’s rights or interests under this Lease so long as Tenant
is not in default under this Lease.  Tenant
shall execute such documents within twenty (20) days after Landlord’s written
request.

 

13.                                 DAMAGE OR DESTRUCTION:

 

(a)                                  Landlord’s Obligation to Rebuild.  Subject to the provisions of Paragraphs (b), (c) and
(d) below, if, during the Term, the Premises are totally or partially
destroyed, Landlord shall, within forty-five (45) days after the destruction,
commence to restore the Premises to substantially the same condition as they
were in immediately before the destruction and prosecute the same diligently to
completion.  Such destruction shall not
terminate this Lease.  Landlord’s
obligation shall not include repair or replacement of Tenant’s alterations or
Tenant’s equipment, furnishings, fixtures and personal property.  If the existing laws do not permit the
Premises to be restored to substantially the same condition as they were in
immediately before

 

13

 

destruction, and Landlord is unable to get a variance to such laws to
permit the commencement of restoration of the Premises within the 45-day
period, then either party may terminate this Lease by giving written notice to
the other party within thirty (30) days after expiration of the 45-day
period.

 

(b)                                 Right to Terminate.

 

(i)                                     Landlord’s
Right to Terminate.  Landlord shall
have the option to terminate this Lease if the Premises or the Building is
destroyed or damaged by fire or other casualty, regardless of whether the
casualty is insured against under this Lease, if Landlord reasonably determines
that (i) there are insufficient insurance proceeds made available to
Landlord to pay all of the costs of the repair or restoration or (ii) the
repair or restoration of the Premises or the Building cannot be substantially
completed within one hundred fifty (150) days after the date of the casualty.  If Landlord elects to exercise the right to
terminate this Lease as a result of a casualty, Landlord shall exercise the
right by giving Tenant written notice of its election to terminate this Lease
within forty-five (45) days after the date of the casualty, in which event this
Lease shall terminate effective as of the date of the casualty.

 

(ii)                                  Tenant’s
Right to Terminate.  Tenant shall
have the option to terminate this Lease if the Premises or the Building is
destroyed or damaged by fire or other casualty, regardless of whether the
casualty is insured against under this Lease, if Landlord reasonably determines
that the repair or restoration of the Premises or the Building cannot be
substantially completed within one hundred fifty (150) days after the date of
the casualty.  If Tenant elects to
exercise the right to terminate this Lease as a result of a casualty, Tenant
shall exercise the right by giving Landlord written notice of its election to
terminate this Lease within thirty (30) days after Landlord notifies Tenant in
writing of its estimate of the time required to substantially repair or restore
the Premises or the Building, in which event this Lease shall terminate
effective as of the date of the casualty.

 

(iii)                               Commencement
of Repair.  If neither party
exercises its right to terminate this Lease pursuant to this Section 13.b,
Landlord shall promptly commence the process of obtaining all of the necessary
permits and approvals for the repair or restoration of the Premises or the
Building as soon as practicable and thereafter prosecute the repair or
restoration of the Premises or the Building diligently to completion and this
Lease shall continue in full force and effect.

 

(c)                                  Last Year of Term.  Landlord shall have the right to terminate
this Lease upon thirty (30) days’ prior written notice to Tenant if the
Premises or Building is substantially destroyed or damaged during the last
twelve (12) months of the Term.  Landlord
shall notify Tenant in writing of its election to terminate this Lease under
this Paragraph (c), if at all, within forty-five (45) days after Landlord
determines that the Premises or Building has been substantially destroyed.  If Landlord does not elect to terminate this
Lease, the repair of the Premises or Building shall be governed by Paragraphs
(a), (b) and (d).

 

(d)                                 Uninsured Casualty.  If the Premises are damaged from any
uninsured casualty to any extent whatsoever, Landlord may within forty-five
(45) days following the date of such damage: 
(i) commence to restore the Premises to substantially the same
condition as

 

14

 

they were in immediately before the destruction and prosecute the same
diligently to completion, in which event this Lease shall continue in full
force and effect; or (ii) within the 45-day period Landlord may
elect not to so restore the Premises, in which event this Lease shall cease and
terminate.  In either such event,
Landlord shall give Tenant written notice of its intention within the 45-day
period.

 

(e)                                  Abatement of Rent.  In the event of destruction or damage to the
Premises which materially interferes with Tenant’s use of the Premises, if this
Lease is not terminated as above provided, there shall be an abatement or
reduction of Base Rent between the date of destruction and the date Landlord
substantially completes its reconstruction obligations, based upon the extent
to which the destruction materially interferes with Tenant’s use of the
Premises.  All other obligations of
Tenant under this Lease shall remain in full force and effect.  Except for abatement of Base Rent, Tenant
shall have no claim against Landlord for any loss suffered by Tenant due to
damage or destruction of the Premises or any work of repair undertaken as
herein provided.

 

(f)                                    Waiver.  The provisions of California Civil Code
Sections 1932(2) and 1933(4), and any successor statutes, are inapplicable
with respect to any destruction of the Premises, such sections providing that a
lease terminates upon the destruction of the Premises unless otherwise agreed
between the parties to the contrary.

 

14.                                 CONDEMNATION:

 

If the
Building or any part thereof shall be taken for any public or quasi-public use
in condemnation proceedings or by any right of eminent domain or sale in lieu
of condemnation, this Lease shall terminate as of the date of taking and any
prepaid Rent and other charges shall be refunded to Tenant; provided, however,
that if less than the entire Building shall be so taken and, in Tenant’s
reasonable opinion, the Premises (or the portion remaining) are adequate and
suitable for Tenant’s Intended Use, then this Lease shall continue in full
force and effect as to that portion of the Premises remaining and the monthly
installment of Rent payable hereunder after the date of said taking and for the
remainder of the Term hereof shall be reduced in the same proportion as the
floor area of the Premises is reduced by said taking.  In such an event (i.e. the continuance of
this Lease as to the portion remaining), Landlord shall make every reasonable
effort to diligently restore said Building and Premises as closely as
reasonably possible to their condition immediately prior to the taking, however
it is agreed that Landlord shall not be required to expend more than the amount
of the condemnation proceeds.  Landlord
shall at all times keep Tenant fully advised of any condemnation proceedings or
threat thereof.  Any award or
compensation arising out of such taking shall belong to and be paid to Landlord
except with respect to any separate award made to Tenant for its leasehold improvements
and fixtures, relocation expenses and other damages or costs pursuant to a
separate independent action taken by Tenant against the condemning authority.  In the event that any access to the Premises
or any parking spaces as may be granted to Tenant herein are so taken, Landlord
shall promptly substitute similarly situated access or parking spaces of equal
quality therefor, failure of Landlord so to do giving Tenant the right to
terminate this Lease as of the date of taking by giving written notice thereof
to Landlord.

 

15

 

15.                                 ACCESS:

 

Landlord’s
agents, employees, contractors, prospective purchasers, existing and
prospective mortgagees, and, during the last nine (9) months of the Term,
prospective tenants, shall have the right to enter the Premises at reasonable
times with prior reasonable notice to Tenant for the purpose of inspecting the
same; and further, Landlord and its employees, agents and contractors shall
have the right to enter the Premises without notice at any time as may be
necessary for the purpose of making repairs thereto and to the Building and its
mechanical systems and for the purpose of performing the services to be
performed by Landlord pursuant to the terms of this Lease; provided in every
instance, however, that any such party so entering upon the Premises shall
cause as little inconvenience, annoyance and disturbance to Tenant as may be
reasonably possible under the circumstances and shall comply with all
reasonable security regulations and procedures as may then be in effect with
respect to Tenant’s operations in the Premises.

 

16.                                 DEFAULT BY
TENANT; REMEDIES:

 

16.1.                        Default.  The occurrence of any of the following events
shall constitute an event of default on the part of Tenant under this Lease:

 

(a)                                  Tenant
defaults in the payment of any installment of Rent or any other sum
specifically to be paid by Tenant hereunder and such default shall not have
been cured within ten (10) business days after Landlord shall have given
to Tenant written notice specifying such default;

 

(b)                                 Tenant
defaults in the observance or performance of any of Tenant’s other covenants
hereunder (other than the covenant to pay Rent or any other sum herein
specified to be paid by Tenant) and such default shall not have been cured
within thirty (30) days after Landlord shall have given to Tenant written
notice specifying such default; provided, however, that if the default
complained of shall be of such a nature that the same cannot be completely
remedied or cured within such thirty-day period, then such default shall not be
an enforceable default against Tenant for the purposes of this Paragraph if
Tenant shall have commenced curing such default within such thirty-day period
and shall proceed with reasonable diligence and in good faith to remedy the
default complained of;

 

(c)                                  Tenant,
finally and without further possibility of appeal or review, (i) is
adjudicated bankrupt or insolvent, or (ii) has a receiver or trustee
appointed for all or substantially all of its business or assets on the ground
of Tenant’s insolvency, or (iii) suffers an order to be entered approving
a petition filed against Tenant seeking reorganization of Tenant under the
Federal Bankruptcy Laws or any other applicable law or statute of the United
States or any State thereof; and

 

(d)                                 Tenant
makes an assignment for the benefit of its creditors, or files a voluntary
petition in bankruptcy or a petition or answer seeking reorganization or
arrangement under the Federal Bankruptcy Laws or any other applicable law or
statute of the United States or any State thereof, or files a petition to take
advantage of any insolvency act or shall consent to the appointment of a
receiver or trustee of all or a substantial part of its business and property.

 

16

 

16.2.                        Remedies.  In the event of any default or breach by
Tenant and a failure to cure same within the applicable cure period, if any,
Landlord may at any time thereafter, without limiting Landlord in the exercise
of any right or remedy at law or in equity which Landlord may have by reason of
such default or breach:

 

(a)                                  Continue
Lease.  Pursue the remedy described
in California Civil Code Section 1951.4 whereby Landlord may continue this
Lease in full force and effect after Tenant’s breach and recover the Rent and
any other monetary charges as they become due, without terminating Tenant’s
right to sublet or assign this Lease, subject only to reasonable limitations as
herein provided.  During the period
Tenant is in default, Landlord shall have the right to do all acts necessary to
preserve and maintain the Premises as Landlord deems reasonable and necessary,
including removal of all persons and property from the Premises, and Landlord
can enter the Premises and relet them, or any part of them, to third parties
for Tenant’s account.  Tenant shall be
liable immediately to Landlord for all costs Landlord incurs in reletting the
Premises, including, without limitation, brokers’ commissions, expenses of
remodeling the Premises required by the reletting, and like costs.  Reletting can be for a period shorter or
longer than the remaining Term.

 

(b)                                 Perform.  Pay or perform such obligation due (but shall
no be obligated to do so), if Tenant fails to pay or perform any obligations
when due under this Lease within the time permitted for their payment or
performance.  In such case, the costs
incurred by Landlord in connection with the performance of any such obligation
will be additional rent due under this Lease and will become due and payable on
demand by Landlord.

 

(c)                                  Terminate.  Terminate Tenant’s rights to possession by any
lawful means, in which case this Lease shall terminate and Tenant shall
immediately surrender possession of the Premises to Landlord.  In such event Landlord shall be entitled to
recover from Tenant all damages incurred by Landlord by reason of Tenant’s
default, including, without limitation, the following:  (A) the worth at the time of award of
any unpaid Rent which had been earned at the time of such termination; plus (B) the
worth at the time of award of the amount by which the unpaid Rent which would
have been earned after termination until the time of award exceeds the amount
of such Rent loss that is proved could have been reasonably avoided; plus (C) the
worth at the time of award of the amount by which the unpaid Rent for the
balance of the Term after the time of award exceeds the amount of such Rent
loss that is proved could be reasonably avoided; plus (D) any other amount
necessary to compensate Landlord for all the detriment proximately caused by
Tenant’s failure to perform its obligations under this Lease or which in the
ordinary course of events would be likely to result therefrom; plus (E) at
Landlord’s election, such other amounts in addition to or in lieu of the
foregoing as may be permitted from time to time by applicable State law.  In addition, Landlord shall be entitled to
recover from Tenant the unamortized portion of any tenant improvement
allowance, free rent or other allowance provided by Landlord to Tenant and any
brokerage commission or finders fee paid or incurred by Landlord in connection
with this Lease (amortized on straight line-basis over the original term of
this Lease.) Upon any such termination of Tenant’s possessory interest in and
to the Premises, Tenant (and at Landlord’s sole election, Tenant’s sublessees)
shall no longer have any interest in the Premises, and Landlord shall have the
right to make any reasonable repairs, alterations or modifications to the
Premises which Landlord in its sole discretion deems reasonable and necessary.  The “worth at the time of award” of the
amounts referred to in

 

17

 

subparagraphs (A) and (B) above
is computed by allowing interest at a rate equal to eight percent (8%) per
annum.  The worth at the time of award of
the amount referred to in subparagraph (C) above is computed by
discounting such amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of award plus one percent (1%).

 

(d)                                 Additional
Remedies.  Pursue any other legal or
equitable remedy available to Landlord.  Unpaid
installments of Rent and other unpaid monetary obligations of Tenant under the
terms of this Lease shall bear interest from the date due at the rate of five
percent (5%) per annum.

 

(e)                                  Continue.  Even though Tenant has breached this Lease
and abandoned the Premises, this Lease shall continue in effect for so long as
Landlord does not terminate Tenant’s right to possession, and Landlord may
enforce all its rights and remedies under this Lease, including the right to
recover Rent as it becomes due under this Lease.  Acts of maintenance or preservation, efforts
to relet the Premises, or the appointment of a receiver upon initiative of
Landlord to protect Landlord’s interest under this Lease, shall not constitute
a termination of Tenant’s right to possession.

 

17.                                 ESTOPPEL CERTIFICATES:

 

Tenant shall,
within twenty (20) days after written request of Landlord, execute, acknowledge
and deliver to Landlord or to Landlord’s mortgagee, proposed mortgagee, land
lessor or proposed purchaser of the Building, any estoppel certificates
requested by Landlord which shall state whether this Lease is in full force and
effect and whether any changes may have been made to the original of this
Lease; whether the Term of this Lease has commenced and full Rent is accruing;
whether there are any defaults by Landlord and, if so, the nature of such
defaults; whether possession has been assumed and all improvements to be
provided by Landlord have been completed; whether Rent has been paid more than
thirty (30) days in advance; whether there are any liens, charges, or offsets
against Rent due or to become due; and whether the address shown on such
estoppel certificate is accurate.  Landlord
agrees that, within twenty (20) days after written request of Tenant, Landlord
shall execute, acknowledge and deliver to Tenant a similar certificate.

 

18.                                 HOLDING OVER:

 

In the event
Tenant remains in possession of the Premises after the expiration of the Term,
it shall be deemed to be a tenant from month-to-month only, at one hundred
fifty percent (150%) of the monthly installment of Rent in effect during the
last month of the expired Term.  Except
as aforesaid, such tenancy shall be upon and subject to the terms of this Lease.  Either party may terminate such tenancy by
giving to the other at least thirty (30) days prior written notice of its
intent to terminate.  Nothing herein,
however, shall be deemed to grant to Tenant the right to hold over in the
Premises beyond the expiration of the Term and Landlord shall be entitled to
all remedies available to it, in law or in equity, as a result of any holding
over in the Premises without Landlord’s consent.

 

18

 

19.                                 SURRENDER:

 

Tenant agrees
to quit and surrender possession of the Premises to Landlord at the expiration
of the Term in as good condition as when delivered by Landlord, except for the
following:  (a) ordinary wear and
tear, (b) Alterations not removed as permitted hereunder, (c) any
appropriation or taking under power of eminent domain or by paramount
authority, (d) damage by fire or other casualty, and (e) condition by
reason of Landlord’s failure to repair as required of it hereunder.

 

20.                                 NOTICES:

 

All notices,
requests, demands or other communications with respect to this Lease, whether
or not herein expressly provided for, shall be in writing and shall be deemed
to have been duly given either (a) forty-eight (48) hours after being
mailed by United States First-Class, certified or registered mail, postage
prepaid, return receipt requested, or (b) the next business day after
being deposited (in time for delivery by such service on such business day)
with Federal Express or another national courier service, for delivery to the
parties at the following addresses (which such addresses may be changed by
either party by giving written notice thereof to the other):

 

If to Landlord:

 

WVB HOLDINGS, LLC, a California limited
liability company

c/o Basin Street Properties

1318 Redwood Way, Suite 140

Petaluma, CA 94954

Attn:  Ms. Betsy Ross

 

If to Tenant:

 

GE Capital Corporation

44 Old Ridgebury Road

Danbury, CT 06801

Attention:  Mr. Jeff Knipe

 

21.                                 QUIET ENJOYMENT:

 

Landlord
covenants and agrees that Tenant, so long as it shall not be in default
hereunder, shall and may, at all times during the Term, peaceably and quietly
have, hold, occupy and enjoy the Premises and Common Areas pursuant to the
terms of this Lease.

 

22.                                 RIGHT TO EXTEND:

 

(a)                                  Options to Extend.  Tenant shall have two (2) options to
extend the Term for a period of two (2) years each (hereinafter referred
to as the “First Extension Term” and “Second Extension Term,” respectively, and
each, an “Extension Term”), provided that at the time Tenant’s Extension Notice
(defined below) is given and at the time the Extension Term is to

 

19

 

commence no default by Tenant exists under this Lease.  Tenant shall exercise such option, if at all,
by written notice (“Tenant’s Extension Notice”) to Landlord not later than
eight (8) months, nor earlier than one (1) year, prior to the
expiration of the original Term or the First Extension Term, as the case may be.  Tenant’s failure to deliver Tenant’s Extension
Notice to Landlord in a timely manner shall be deemed a waiver of Tenant’s
option to extend the Term and Tenant’s extension option, and any future option
to extend the Term, shall lapse and be of no force or effect.

 

(b)                                 Exercise of Option.

 

(1)                                  First
Extension Term.  If Tenant exercises
its extension option for the First Extension Term, the Term shall be extended
for an additional period of two (2) years on all of the terms and
conditions of this Lease, except (i) Tenant’s options to further extend the
Term shall be reduced in number by one, (ii) Landlord shall not be
required to pay to Tenant any tenant improvement allowance or inducement and (iii) the
monthly Base Rent for the First Extension Term shall be the greater of (A) an
amount equal to ninety-five percent (95%) of the “Fair Market Rent” prevailing
at the commencement of the First Extension Term or (B) the monthly Base
Rent in effect at the end of the original Term.

 

(2)                                  Second
Extension Term.  If Tenant exercises
its extension option for the Second Extension Term, the Term shall be extended
for an additional period of two (2) years on all of the terms and
conditions of this Lease, except (i) Tenant shall have no further options
to extend the Term, (ii) Landlord shall not be required to pay to Tenant
any tenant improvement allowance or inducement and (iii) the monthly Base
Rent for the Second Extension Term shall be the greater of (A) an amount
equal to ninety-five percent (95%) of the “Fair Market Rent” prevailing at the
commencement of the Second Extension Term or (B) the monthly Base Rent in
effect at the end of the First Extension Term.

 

(c)                                  Determination of Fair Market
Rent.  For the purposes of this Lease, the “Fair
Market Rent” means the monthly base rent (i.e., rent other than operating expenses,
taxes and insurance premiums) expected to prevail as of the commencement of an
Extension Term for the entire Extension Term with respect to “full service”
leases of comparable space within buildings located in Santa Rosa, California
of a quality and with interior improvements, parking, site amenities, building
systems, location, identity and access all comparable to that of the Premises,
for a term equal to the Extension Term.  Landlord
shall notify Tenant in writing (hereinafter referred to as “Landlord’s Notice”)
within fifteen (15) days after receipt of Tenant’s Extension Notice of Landlord’s
estimate of the Fair Market Rent for the Extension Term.  Within fifteen (15) days after receipt of
Landlord’s Notice, Tenant shall either (i) notify Landlord in writing that
Tenant accepts Landlord’s determination of Fair Market Rent for the Extended Term
in or (ii) provide Landlord with its estimate of Fair Market Rent for the
Extension Term.  If the parties are
unable to reach an agreement on the Fair Market Rent within ten (10) days
of exchanging such estimates than Tenant may rescind Tenant’s Extension Notice.  If the parties agree upon the Fair Market
Rent number, the parties shall amend this Lease to provide for the Base Rent
during the Extension Term.  If Tenant
rescinds Tenant’s Extension Notice, Tenant shall be deemed to have waived its
right to extend the Term.

 

20

 

(d)                                 Notice to Landlord and Tenant.  After the monthly Base Rent for an Extension
Term has been set, Landlord and Tenant immediately shall execute an amendment
to this Lease stating the monthly Base Rent.

 

23.                                 TENANT IMPROVEMENTS:

 

(a)                                  Landlord shall perform or cause
to have performed on and to the Premises the work listed and/or shown on attached
EXHIBIT “F”, all at Tenant’s sole cost and expense except to the extent
provided below in Paragraph 23(e).  All
such work (“Work”) shall be performed in a first-class workmanlike manner in
strict accordance with the plans and specifications referenced in EXHIBIT “F”
which have been approved by both Tenant and Landlord, and in accordance with
all applicable governmental laws, rules, regulations and other requirements.  Landlord shall apply for and obtain all
permits, licenses and certificates necessary for performance of the Work.  All of the said Work shall be “Substantially
Completed” (as hereinafter defined) on or before the Commencement Date.  The Work shall be deemed to be “Substantially
Completed” at such time as (i) Landlord shall certify in writing to Tenant
that said Work has been completed in accordance with the foregoing provisions
of this subparagraph (a), subject only to minor punch list items which shall be
therein specifically noted and which shall be such as not to adversely affect
Tenant’s use and occupancy of the Premises for Tenant’s Intended Use for a
short duration of time, and (ii) a certificate of occupancy or “finaled”
building permit is issued by the appropriate governmental authority with
respect to the Premises and the Work.  Following
substantial completion of the Work, Landlord shall obtain a certificate of
occupancy for the Premises; provided, however, Landlord shall not be in default
of this Section to the extent that Landlord is precluded or prevented from
obtaining a certificate of occupancy for the Work or the Premises as a result
of any actions or omissions by Tenant.

 

(b)                                 The minor punch list items
referred to in subparagraph (a) immediately preceding shall not act to
suspend or delay the Commencement Date, but Landlord shall, as soon as
reasonably possible following the Commencement Date, complete said minor punch
list items, together with such other defects as Tenant shall thereafter
discover and which Tenant shall report to Landlord in writing within thirty
(30) days following said Commencement Date.

 

(c)                                  Tenant shall have the right to
enter upon the Premises at any time or times prior to the Commencement Date for
the purpose of installing its equipment, fixtures, furniture and
telecommunication systems, provided that in so doing the progress of the Work
shall not be unreasonably interfered with or delayed.  Any such prior use of the Premises shall not
constitute acceptance of the Premises nor shall it in any way be deemed a
waiver of any rights Tenant might have under this Lease.

 

(d)                                 If for any reason whatever the
Work is not Substantially Completed on or before the sixtieth (60th) day after
the Estimated Commencement Date specified in Paragraph 3 hereof, then at any
time thereafter, but prior to Substantial Completion, Tenant may terminate this
Lease by written notice to Landlord and receive back all monies paid hereunder,
in which event this Lease shall be null and void and neither party shall have
any further obligation or liability hereunder; provided, however, that
if Landlord would have Substantially Completed the Work on or before the
Commencement Date specified in Paragraph 3 hereof but for (i) delays
caused by strikes, fire, unusually severe and adverse weather conditions,
unanticipated shortages

 

21

 

of necessary labor or materials or for other reasons beyond the
reasonable control of Landlord (“Force Majeure Delays”) or (ii) any Tenant
Delay, then Tenant’s termination rights as aforesaid shall be postponed for
that period of time that the Force Majeure Delays or Tenant Delay so delayed
the Commencement Date.  It is expressly
agreed that Landlord shall give Tenant written notice of each and every Force
Majeure Delay within five (5) days of the specific occurrence giving rise
thereto and shall thereafter use commercially practicable efforts to eliminate
or reduce the effect of such adverse condition on Substantial Completion of the
Work.

 

(e)                                  Landlord shall provide Tenant
with a one-time tenant improvement allowance (the “Tenant Improvement Allowance”)
in the amount of up to, but not exceeding $5.00 per rentable square foot of the
Premises for the Work and $0.20 per rentable square foot for the costs relating
to the initial design and construction of the Work.  In no event shall Landlord be obligated to
make disbursements pursuant to this paragraph in a total amount which exceeds
the Tenant Improvement Allowance.  Tenant
shall not be entitled to receive any cash payment or credit against Rent or
otherwise for any unused portion of the Tenant Improvement Allowance which is
not used to pay for the Work.  The Tenant
Improvement Allowance may only be used to pay for the following items and costs:  (i) payment of the architectural and
engineering fees and costs, (ii) payment of plan check, permit and license
fees relating to construction of the Work; (iii) the cost of constructing
the Work, including, without limitation, contractors’ fees and general
conditions, testing and inspection costs, costs of utilities, trash removal,
parking and hoists, and the costs of after-hours freight elevator usage; (iv) the
cost of any changes to the Work required to comply with any applicable laws or
ordinances; and (v) sales and use taxes and Title 24 fees.

 

24.                                 NAME OF PARK OR BUILDING:

 

[Intentionally
Deleted].

 

25.                                 HAZARDOUS SUBSTANCES:

 

(a)                                  Landlord represents and warrants
to Tenant that, to Landlord’s actual knowledge, (i) there are no Hazardous
Substances on, in or under the Park in violation of any Environmental Laws and (ii) there
is no asbestos or asbestos-containing hazardous materials (“asbestos”) in the
Building.  Landlord shall indemnify and
hold harmless the Tenant from any and all claims, damages, fines, judgments,
penalties, costs, expenses or liabilities (including, without limitation, any
and all sums paid for settlement of claims and all reasonable attorneys’,
consultant and expert fees) arising prior to, during or after the Term from or
in connection with the use, storage, generation or disposal of Hazardous
Substances in, on or about the Land, Building or Premises by Landlord or
Landlord’s agents, employees or contractors.

 

(b)                                 Except for ordinary office
supplies and janitorial cleaning materials which in common business practice
are customarily and lawfully used, stored and disposed of in small quantities,
Tenant shall not cause or permit any Hazardous Substances to be used, stored,
generated or disposed of in, on or about the Park, Land, Building or Premises
by Tenant or its agents, employees, contractors or invitees.  Tenant shall indemnify and hold harmless the
Landlord from any and all claims, damages, fines, judgments, penalties, costs,
expenses or liabilities (including, without limitation, any and all sums paid
for settlement of claims and all

 

22

 

reasonable attorneys’, consultant and expert fees) arising during or
after the Term from or in connection with the use, storage, generation or
disposal of Hazardous Substances in, on or about the Land, Building or Premises
by Tenant or Tenant’s agents, employees, contractors or invitees.

 

(c)                                  Notwithstanding anything to the
contrary stated hereinabove, the indemnifications contained in subparagraphs (a) and
(b) above shall not include any consequential damages (e.g. loss of rent,
use and profits) incurred by either Landlord or Tenant, but shall expressly
include, without limitation, any and all costs incurred due to any
investigation of the site or any cleanup, removal or restoration mandated by or
pursuant to any Environmental Laws.  The
indemnifications contained herein shall survive any expiration or termination
of the Term, but shall terminate three (3) years after any such expiration
or termination except with respect to any specific claims which have been given
in writing by either party to the other prior to the expiration of said
three-year period.

 

(d)                                 As used herein, “Hazardous
Substances” means any substance which is toxic, ignitable, reactive, or
corrosive or which is regulated by “Environmental Laws”.  The term “Environmental Laws” means federal,
state and local laws and regulations, judgments, orders and permits governing
safety and health and the protection of the environment, including without
limitation the Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. 9601 et seq., as amended (CERCLA), the Resource
Conservation and Recovery Act, as amended 42 U.S.C. 6901 et seq., the Clean Water Act, 33 U.S.C.
1251 et seq., the Clean Air Act,
42 U.S.C. 7401 et seq., the Toxic
Substance Control Act, 15 U.S.C. 2601 et seq., and the Safe Drinking
Water Act, 42 U.S.C. 300f through 300j.  “Hazardous
Substances” includes any and all materials or substances which are defined as “hazardous
waste”, “extremely hazardous waste” or a “hazardous substance” pursuant to state,
federal or local governmental law.  “Hazardous
Substances” also includes asbestos, polychlorinated biphenyls (“PCBs”) and
petroleum products.

 

26.                                 SIGNS:

 

Landlord, at
Landlord’s expense, shall install directory signage for Tenant in the Building
lobby and entry signage on Tenant’s suite in accordance with Landlord’s sign
criteria.  Tenant shall not attach or
install any sign to or on any part of the outside of the Premises, the Building
or the Park, or in the halls, lobbies, windows or elevator banks of the
Building without Landlord’s prior written consent, which consent may be
withheld in Landlord’s sole and reasonable discretion.  Any signage so permitted shall be subject to
prior approval of and conformance with the requirements of the County of Sonoma
and Landlord’s sign criteria.

 

27.                                 TRANSFER OF
THE BUILDING BY LANDLORD:

 

In the event
of any conveyance of the Building and assignment by Landlord of this Lease,
Landlord shall be and is hereby released from all liability under any and all
of its covenants and obligations contained in or derived from this Lease
occurring after the date of such conveyance and assignment provided that such
transferee expressly assumes all of Landlord’s obligations under this Lease.  In such an event Tenant agrees to attorn to
such transferee.

 

23

 

28.                                 LIMITATION
OF LIABILITY OF LANDLORD:

 

If, as a
consequence of a default by Landlord under this Lease, Tenant recovers a money
judgment against Landlord, such judgment shall be satisfied only out of the
proceeds received upon execution of such judgment and levied thereon against
the right, title and interest of Landlord in the Building, Land and Park and
out of rent or other income from such property or out of consideration received
by Landlord from the sale or other disposition of all or any part of Landlord’s
right, title or interest in the Building, Land and Park, and Landlord shall not
be liable for any deficiency.  Notwithstanding
the foregoing, however, there shall be no limitation on Landlord’s liability
for any default by Landlord with respect to the provisions of Paragraph 25
hereof, and all of the assets of Landlord shall be subject to levy and
execution upon any breach of such provisions or any failure of the representations,
warranties or indemnifications of Landlord therein contained.

 

29.                                 LIENS:

 

Tenant shall
keep the Building and Premises free from any liens arising out of any work
performed, materials furnished or obligations incurred by or on behalf of
Tenant (other than the Work provided for in Paragraph 23 hereof) and shall
indemnify, defend and hold Landlord harmless from all claims, costs and
liabilities, including reasonable attorneys’ fees and costs, in connection with
or arising out of any such lien or claim of lien.  Tenant shall cause any such lien imposed on
the property to be released of record by payment or posting of a proper bond
within ten (10) days after written request by Landlord.

 

30.                                 BROKERS:

 

Landlord and
Tenant each represent and warrant to the other that it has had no dealings with
any real estate broker or agent in connection with the negotiation of this
Lease, except Keegan & Coppin (Shawn Johnson) and Colliers
International (Peter Pomeroy) whose commission shall be payable by Landlord,
and that it knows of no other real estate broker or agent who is or might be
entitled to a commission in connection with this Lease.  Landlord and Tenant each agree to indemnify,
defend and hold the other harmless from all costs and liabilities, including
reasonable attorneys’ fees and costs, arising out of or in connection with
claims made by any other broker or individual who alleges that it is entitled
to commissions or fees with regard to this Lease as a result of dealings it had
with the indemnifying party.

 

31.                                 DEFAULT BY LANDLORD:

 

Landlord shall
not be in default under this Lease unless Landlord, or the holder of any
mortgage, deed of trust or ground lease covering the Premises, fails to perform
obligations required of Landlord within a reasonable time, but in no event
later than thirty (30) days after written notice by Tenant to Landlord
certified mail, postage prepaid, and to the holder of any first mortgage, deed
of trust or ground lease covering the Premises whose name and address shall
have been furnished to Tenant in writing, specifying wherein Landlord has
failed to perform such obligations; provided, however, that if the nature of
Landlord’s obligation is such that more than thirty (30) days are required for
performance, then Landlord shall not be in default if Landlord or the holder of
any such mortgage, deed of trust or ground lease commences

 

24

 

performance within such 30 day period and thereafter diligently
prosecutes the same to completion.  In no
event shall Tenant be entitled to terminate this Lease by reason of Landlord’s
default.

 

32.                                 ATTORNEYS’ FEES:

 

If either
party brings any action or legal proceeding for damages for an alleged breach
of any provision of this Lease, to recover Rent or other sums due, to terminate
the tenancy of the Premises or to enforce, protect or establish any term, condition
or covenant of this Lease or right of either party, the prevailing party shall
be entitled to recover as a part of such action or proceedings, or in a
separate action brought for that purpose, reasonable attorneys’ fees and costs
to be fixed and determined by the court in such action or proceeding.

 

33.                                 COMPLIANCE WITH LAWS:

 

(a)                                  Landlord represents and warrants
to Tenant that, to Landlord’s actual knowledge, on the Commencement Date of
this Lease neither the Land, Building, Premises and Common Areas is in material
violation of any applicable governmental laws, ordinances, rules, regulations
and requirements.  Landlord covenants and
agrees that it shall, at all times during the Term and at its sole cost and
expense, promptly comply with all governmental laws, ordinances, rules,
regulations and requirements which may in any way be applicable to the Land,
Building, Premises or Common Areas, except to the extent such compliance is
assumed by Tenant as provided in subparagraph (b) below.

 

(b)                                 Tenant shall, at all times
during the Term and at its sole cost and expense, promptly comply with all
governmental laws, ordinances, rules, regulations and requirements which may be
applicable to the particular manner in which Tenant conducts its business on
the Premises, however in no event shall Tenant be required (or permitted) to
make any Alterations which are structural in nature or which affect the
building systems, all such required Alterations being hereby expressly assumed
by Landlord.

 

34.                                 RECORDING:

 

[Intentionally
deleted]

 

35.                                 MISCELLANEOUS
PROVISIONS:

 

35.1.                        Time Periods.  All periods of time referred to in this Lease
shall include all Saturdays, Sundays and state or national holidays, unless the
period of time specifies business days, however if the date or last date to
perform any act or give notice or approval shall fall on a Saturday, Sunday or
state or national holiday, such act, notice or approval shall be timely if
performed or given on the next succeeding day which is not a Saturday, Sunday
or state or national holiday.

 

35.2.                        Waiver.  The waiver by Landlord or Tenant of any
breach of any term, condition or covenant of this Lease shall not be deemed to be
a waiver of such provision or any subsequent breach of the same or any other
term, condition or covenant of this Lease. 
No

 

25

 

covenant, term or condition of this Lease shall be deemed to have been
waived by Landlord or Tenant unless such waiver is in writing and signed by the
waiving party.

 

35.3.                        Severability.  If any provisions of this Lease shall be held
to be invalid, void or unenforceable, the remaining provisions hereof shall not
be affected or impaired, and such remaining provisions shall remain in full
force and effect.

 

35.4.                        Exhibits.  All exhibits referred to herein are attached
hereto and incorporated by reference.

 

35.5.                        Executed Copy.  Any fully executed copy of this Lease shall
be deemed an original for all purposes.

 

35.6.                        Binding Effect.  The covenants and agreements contained in
this Lease shall be binding on the parties hereto and on their respective
successors and permitted assigns.

 

35.7.                        Captions.  The captions and headings used in this Lease
are for the purpose of convenience only and shall not be construed to limit or
extend the meaning of any part of this Lease.

 

35.8.                        Entire Agreement.  This Lease is the entire agreement between
the parties, and there are no agreements or representations between the parties
except as expressed herein.  Except as
otherwise provided herein, no subsequent change or addition to this Lease shall
be binding unless in writing and signed by the parties hereto.

 

35.9.                        Strict Construction.  This Lease is intended to express the mutual
intent of the parties hereto, and no rule of strict construction shall be
applied against either Landlord or Tenant.

 

35.10.                  Time of the Essence.  Time is of the essence for the performance of
each term, condition and covenant of this Lease.  The foregoing shall not operate, however, to
reduce the time period allocated for the performance of any obligation or the
curing of any default if a time period is specified in the Lease for the
performance of such obligation.

 

35.11.                  Applicable Law.  This Lease shall be governed by and construed
in accordance with the internal laws of the State of California,
notwithstanding any choice of law statutes, regulations, provisions or
requirements to the contrary.

 

35.12.                  Successors and Assigns.  Subject to the provisions of this Lease
restricting assignment or subletting by Tenant, this Lease shall bind the
parties, their personal representatives, successors and assigns.

 

35.13.                  Joint and Several Liability.  If there is more than one party comprising
Tenant or Landlord, the obligations imposed on Tenant or Landlord shall be
joint and several.

 

35.14.                  Addendum.  The Addendum attached hereto is incorporated
herein by reference.

 

26

 

36.                                 NO OFFER:

 

The submission
of this Lease for examination or the negotiation of the transaction described
herein or the execution of this Lease by only one of the parties shall not in
any way constitute an offer to lease on behalf of either Landlord or Tenant,
and this Lease shall not be binding on either party until duplicate originals
thereof, duly executed on behalf of both parties, have been delivered to each
of the parties hereto.

 

IN WITNESS
WHEREOF, the parties hereto have duly executed this Lease as of the day and year
first above written.

 

	
  “Landlord”

  	
  “Tenant”

  
	
   

  	
   

  
	
  WVB HOLDINGS, LLC

  a California limited liability company

  	
  ADVANCED TELCOM, INC., a

  Delaware corporation

  
	
   

  	
   

  
	
  By:

  	
  G & W Ventures, LLC

  	
  By:

  	
  /s/David M. O’Neill

  	
   

  
	
   

  	
  a California limited liability

  	
   

  	
  Name:

  	
  David M. O’Neill

  	
   

  
	
   

  	
  company

  	
   

  	
  Its:

  	
  President

  	
   

  
	
   

  	
  Managing Member

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/Matthew T. White

  	
   

  	
   

  	
   

  
	
   

  	
  Matthew T. White

  	
   

  	
   

  
	
   

  	
  Manager

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  	
   

  
													

 

27

 

EXHIBIT A

 

FLOOR PLAN

 

 

 

 

EXHIBIT B

 

PLOT PLAN

 

 

 

 

EXHIBIT C

 

RULES AND
REGULATIONS

 

It is further
agreed that the following rules and regulations (these “Rules and
Regulations”) shall be and are hereby made a part of this Lease, and Tenant
agrees that Tenant’s employees and agents, or any others permitted by Tenant to
occupy or enter the Premises, will at all times abide by these Rules and
Regulations, unless otherwise specified or provided for in the Lease, to wit:

 

1.                                       The
driveways, entrances and exits to the Park, sidewalks, passages, building
entries, lobbies, corridors, stairways, and elevators of the Building shall not
be obstructed by Tenant, or Tenant’s agents or employees, or used for any
purpose other than ingress and egress to and from the Premises.  Tenant or Tenant’s agents or employees shall
not loiter on the lawn areas or other common areas of the Park.

 

(a)                                  Furniture, freight equipment and
supplies will be moved in or out of the Building only through the rear service
entrances or other entrances designated by Landlord and then only during such
hours and in such manner as may be reasonably prescribed by Landlord.  Tenant shall cause its movers to use only the
loading facilities and entrances designated by Landlord.  In the event Tenant’s movers damage any part
of the Building or Park, Tenant shall pay to Landlord the amount required to
repair said damage upon Landlord’s written request.

 

(b)                                 No safe or article, the weight
of which may in the opinion of Landlord constitute a hazard to or damage to the
Building or the Building’s equipment, shall be moved into the Premises without
Landlord’s prior written approval, but such consent or approval shall not be
unreasonably withheld, conditioned or delayed. 
Landlord and Tenant shall mutually agree to the location of such
articles in the Premises.  All damage
done to the Park, Building or Premises by putting in, taking out or maintaining
extra heavy equipment shall be repaired at the expense of Tenant.

 

(c)                                  Landlord reserves the right to
close and keep locked any and all entrances and exits of the Building and Park
and gates or doors closing the parking areas thereof during such hours as
Landlord may deem advisable for the adequate protection of the Park and all
tenants therein.

 

2.                                       Entry
into the lakes at the Park shall be strictly prohibited.  Tenant shall be responsible for ensuring that
its employees, visitors, or invitees do not enter the lakes at any time for any
reason.  Tenant shall report any person
observed entering the lake to Landlord immediately.

 

3.                                       Except
as otherwise provided for in the Lease, no sign, advertisement or notice shall
be inscribed, painted or affixed on any part of the inside or outside of the
Building unless of such color, size and style and in such place upon or in the
Building as shall be first approved in writing by Landlord.  No furniture or other materials shall be
placed in front of the Building or in any lobby or corridor without the prior
written consent of Landlord.  Landlord
shall have the right to remove all non permitted signs and furniture without
notice to Tenant.

 

 

4.                                       Tenant
shall not employ any person or persons other than the janitor or cleaning
contractor of Landlord for the purpose of cleaning or taking care of the
Premises without the prior written consent of Landlord, which consent shall not
be unreasonably withheld, conditioned or delayed.  Except as otherwise provided in the Lease,
Landlord shall in no way be responsible to Tenant for any loss of property from
the Premises, however occurring.  The
janitor of the Building may at all times keep a pass key, and other agents of
Landlord shall at all times be allowed admittance to the Premises in accordance
with the provisions set forth in the Lease.

 

5.                                       Water
closets and other water fixtures shall not be used for any purpose other than
that for which the same are intended, and any damage resulting to the same from
misuse on the part of Tenant or Tenant’s agents or employees, shall be paid for
by Tenant.  No person shall waste water
by tying back or wedging the faucets or in any other manner.

 

6.                                       No
animals except seeing eye dogs or other animals necessary to the functioning of
handicapped personnel shall be allowed on the lawns or sidewalks or in the
offices, halls, and corridors of the Building.

 

7.                                       No
persons shall disturb the occupants of this or adjoining buildings or premises
by the use of any radio, sound equipment or musical instrument or by the making
of loud or improper noises, nor interfere in any way with the other tenants or
those having business with them.  Should
sound mitigation measures be required due to sounds originating in the
Premises, the costs of such measures shall be paid for by Tenant.

 

8.                                       Bicycles
or other vehicles, other than wheel chairs, shall not be permitted in the
offices, halls, corridors and lobbies in the Building nor shall any obstruction
of sidewalks or entrances of the Building by such be permitted.

 

9.                                       Tenant
shall not allow anything to be placed on the outside of the Building, nor shall
anything be thrown by Tenant or Tenant’s agents or employees, out of the windows
or doors, or down the corridors, ventilation ducts or shafts of the Building.  Tenant, except in case of fire or other
emergency, shall not open any outside window.

 

10.                                 No
awnings shall be placed over any window or entrance.

 

11.                                 All
garbage, including wet garbage, refuse or trash shall be placed by Tenant in
the receptacles designated by Landlord for that purpose.  Tenant shall not burn any trash or garbage at
any time in or about the leased Premises or any area of the Park.  Tenant and Tenant’s officers, agents, and
employees shall not throw cigar or cigarette butts or other substances or
litter of any kind in or about the Park.

 

12.                                 Tenant
shall not install or operate any steam or gas engine or boiler, or other
machinery or carry on any mechanical business, other than such mechanical
business which normally is identified with general use in the Premises.  Explosives or other articles of an extra
hazardous nature shall not be brought into the Building complex.

 

13.                                 Any
painting or decorating as may be agreed to be done by and at the expense of
Landlord shall be done during regular weekday working hours.  Should Tenant desire such work

 

2

 

on Saturdays,
Sundays, holidays or outside of regular working hours, Tenant shall pay for the
extra cost thereof, if any.

 

14.                                 Tenant
and Tenant’s agents and employees shall park their vehicles in areas designated
from time to time for employee parking.

 

15.                                 Tenant
shall not mark, drive nails, screw, bore, or drill into, paint or in any way
deface the common area walls, exterior walls, roof, foundations, bearing walls,
or pillars without the prior written consent of Landlord.  The expense of repairing any breakage, stoppage or
damage resulting from a violation of this rule shall be borne by Tenant.

 

16.                                 No
waiver of any rule or regulation by Landlord shall be effective unless
expressed in writing and signed by Landlord or his authorized agent.

 

17.                                 Tenant
shall be responsible for cleaning up any trash blowing around their facility
that may have been left by their customers or employees.

 

18.                                 In
the event of any conflict between these Rules and Regulations or any
further or modified rules and regulations from time to time issued by
Landlord, and the Lease provisions, the Lease provisions shall govern and
control.

 

19.                                 Landlord
reserves the right at any time to change or rescind any one or more of these Rules and
Regulations, or to make such other and further reasonable rules and
regulations as in Landlord’s judgment may from time to time be necessary for
the management, safety, care and cleanliness of the Premises, and for the
preservation of good order therein, as well as for the convenience of other
tenants of the Park.  Landlord shall not
be responsible to Tenant or to any other person for the non-observance or
violation of these Rules and Regulations by any other tenant or person.  Tenant shall be deemed to have read these rules and
Regulations and to have agreed to abide by them as a condition to its occupancy
of the space herein leased, and Tenant shall abide by any additional rules and
regulations which are ordered or requested by Landlord or by any governmental
authority.

 

3

 

EXHIBIT D

 

COMMENCEMENT DATE
MEMORANDUM

 

With respect to that certain lease (“Lease”)
dated                                                                              ,
                      ,
between                                                                                ,
a                                              
(“Tenant”), and                                                  ,
a                                                  
(“Landlord”), pursuant to which Landlord leased to Tenant and Tenant leased
from Landlord approximately                                        
rentable square feet of space (“Premises”) in the building located at                                                              ,
Tenant hereby acknowledges and certifies to Landlord as follows:

 

(1)                                  The Commencement Date is                              
and the Expiration Date is                           ;

 

(2)                                  The Premises contain                                   
rentable square feet of space; and

 

(3)                                  Tenant has accepted and is
currently in possession of the Premises and the Premises are acceptable for
Tenant’s use.

 

IN WITNESS
WHEREOF, this Commencement Date Memorandum is executed this              
day of                         ,
20        .

 

	
   

  	
  “Tenant”

  
	
   

  	
   

  
	
   

  	
  ADVANCED TELCOM, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Its:

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Its:

  	
   

  
					

 

 

EXHIBIT E

 

PARKING AREAS

 

 

 

 

EXHIBIT F

 

TENANT IMPROVMENTS

 

FINAL PLANS
AND SPECIFICATIONS TO BE PROVIDED BY LANDLORD TO TENANT UNDER SEPARATE COVER.

 

 

ADDENDUM
NO. 1

 

This Addendum
is attached hereto and made a part of that certain Lease dated June 10,
2004 entered into between WVB HOLDINGS, LLC, a California limited liability
company, as Landlord, and ADVANCED TELCOM, INC., a Delaware, as Tenant.

 

1.                                       Base
Rent.

 

The Base Rent
during the Term shall be as follows:

 

	
  Lease Year

  	
   

  	
  Monthly Full Service Base Rent
  per

  Rentable Sq. Ft.

  
	
  1st Lease Year (months 1 -3)

  	
   

  	
  Free

  
	
  1st Lease Year (months 4 - 12)

  	
   

  	
   

  	
  $

  	
  1.60

  	
   

  
	
  2nd Lease Year

  	
   

  	
   

  	
  $

  	
  1.65

  	
   

  
	
  3rd Lease Year

  	
   

  	
   

  	
  $

  	
  1.70

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00084-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00084-of-00352.parquet"}]]