{"id":41828,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/5225-lovelock-street-san-diego-ca-lease-agreement-lovelock.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"5225-lovelock-street-san-diego-ca-lease-agreement-lovelock","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/land\/5225-lovelock-street-san-diego-ca-lease-agreement-lovelock.html","title":{"rendered":"5225 Lovelock Street (San Diego, CA) Lease Agreement &#8211; Lovelock LLC and Mohawk Industries Inc."},"content":{"rendered":"<pre>\n                        [LETTERHEAD OF LEE &amp; ASSOCIATES]\n\nFebruary 29, 1996\n\nMr. Jack Sharpe\nMOHAWK INDUSTRIES, INC.\nP.O. Box 2208\nDalton, GA 30722\n\nRe: Confirmation of Lessor for 5225 Lovelock Street, San Diego, CA\n\nDear Jack,\n\nThis letter is written to formally confirm the legal name of the Lessor for the\nabove referenced property.\n\nThe lease as written was prepared with Escondido - Trafalgar Limited Partnership\nas Lessor. This partnership recently reformed itself as Lovelock LLC. The lease\nhas been modified by hand by the representative of the Lessor, Mr. Harry Brown.\nThe Federal Taxpayer's I.D. No. for Lovelock LLC is 33-0673063. In the event\nMohawk needs to contact Mr. Brown his telephone number is (714) 498-4328 and\nhis facsimile number is (714) 498-0260.\n\nBase rent payments and other notices for the Lessor should be sent to:\n\n                    Lovelock LLC\n                    Mr. Harry S. Brown\n                    P.O. Box 1431\n                    San Clemente, CA 92674\n\nShould you have any questions, please feel free to call me.\n\nSincerely,\n\nLEE &amp; ASSOCIATES\nCOMMERCIAL REAL ESTATE SERVICES\n\n\n\/s\/ Chris Coyte\n\nChris Coyte\nSenior Vice President\n\n \n        STANDARD INDUSTRIAL\/COMMERCIAL MULTI-TENANT LEASE-MODIFIED NET\n\n                 AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION\n\n                                     [LOGO]\n\n1. Basic Provisions (\"Basic Provisions\").\n\n      1.1 Parties: This Lease (\"Lease\"), dated for reference purposes only,\nFebruary 5, 1996, is made by and between Lovelock, L.L.C., (\"Lessor\") and Mohawk\nIndustries, Inc. a Georgia Corporation (\"Lessee\") (collectively the \"Parties,\"\nor individually a \"Party\").\n\n      1.2(a) Premises: That certain portion of the Building, including all\nimprovements therein or to be provided by Lessor under the terms of this Lease,\ncommonly known by the street address of 5225 Lovelock Street, located in the\nCity of San Diego, County of San Diego, State of California, with zip code\n92110, as outlined on Exhibit a attached hereto (\"Premises\"). The \"Building\" is\nthat certain building containing the Premises and generally described as\n(describe briefly the nature of the Building): An approximately 63,000 square\nfoot Industrial\/Office building on approximately 2.72 acres. Accessors Parcel #\n436-400-25.\n\nIn addition to Lessee's rights to use and occupy the Premises as hereinafter\nspecified, Lessee shall have non-exclusive rights to the Common Areas (as\ndefined in Paragraph 2.7 below) as hereinafter specified, but shall not have any\nrights to the roof, exterior walls or utility raceways of the Building or to any\nother buildings in the Industrial Center. The Premises, the Building, the Common\nAreas, the land upon which they are located, along with all other buildings and\nimprovements thereon, are herein collectively referred to as the \"Industrial\nCenter.\" (Also see Paragraph 2.)\n\n      1.2(b) Parking: See Addendum unreserved vehicle parking spaces\n(\"Unreserved Parking Spaces\"); and See Addendum reserved vehicle parking spaces\n(\"Reserved Parking Spaces\"). (Also see Paragraph 2.6.)\n\n      1.3 Term: 5 years and 6 months (\"Original Term\") commencing April 1, 1996\n(\"Commencement Date\") and ending September 30, 2001 (\"Expiration Date\"). (Also\nsee Paragraph 3).\n\n      1.4 Early Possession: February 15, 1996 (\"Early Possession Date\"). (Also\nsee Paragraph 3.2 and 3.3.)\n\n      1.5 Base Rent: $_____________ per month (\"Base Rent\"), payable on the\nFirst day of each month commencing April 1, 1996. (Also see Paragraph 4.)\n\n|X|   If this box is checked, this Lease provides for the Base Rent to be\n      adjusted per Addendum 1, attached hereto.\n\n      1.6(a) Base Rent Paid Upon Execution: $3,655.00 as Base Rent for the\nperiod April 1, 1996 - April 30, 1996.\n\n      1.6(b) Lessee's Share of Common Area Operating Expenses: Thirteen percent\n(13.49%) (\"Lessee's Share\") as determined by prorata square footage of the\nPremises as compared to the total square footage of the Building or |_| other\ncriteria as described in Addendum _____.\n\n      1.7 Security Deposit: $____________ (\"Security Deposit\"). (Also see\nParagraph 5.)\n\n      1.8 Permitted Use: Warehousing, wholesaling and distribution of carpet and\nrelated products as well as general office use. (\"Permitted Use\"). (Also see\nParagraph 6.)\n\n      1.9 Insuring Party. Lessor is the \"Insuring Party.\" (Also see Paragraph\n8.)\n\n      1.10(a) Real Estate Brokers. The following real estate broker(s)\n(collectively, the \"Brokers\") and brokerage relationships exist in this\ntransaction and are consented to by the Parties (check applicable boxes):\n\n|X|   VOIT COMMERCIAL BROKERAGE represents Lessor exclusively (\"Lessor's\n      Broker);\n\n|X|   LEE &amp; ASSOC. COMMERCIAL REAL ESTATE represents Lessee exclusively\n      (\"Lessee's Broker\").\n\n|_|   ____________________________ represents both Lessor and Lessee (\"Dual\n      Agency\"). (Also see Paragraph 15.)\n\n      1.10(b) Payment to Brokers. Upon the excution of this Lease by both\nParties, Lessor shall pay to said Broker(s) jointly, or in such separate shares\nas they may mutually designate in writing, a fee as set forth in a separate\nwritten agreement between Lessor an said Broker(s) (or in the event there is no\nseparate written agreement between Lessor and said Broker(s), the sum of\n$____________) for brokerage services rendered by said Broker(s) in connection\nwith this transaction.\n\n      1.11 Guarantor. The Obligations of the Lessee under this Lease are to be\nguaranteed by N\/A ____________________________________________________________\n______________________________________________________________________________\n(\"Guarantor\"). (Also see Paragraph 37.)\n\n      1.12 Addenda and Exhibits. Attached hereto is an Addendum or Addenda\nconsisting of Paragraphs 49 through 54, and Exhibits A through ___________, all\nof which constitute a part of this Lease.\n\n2. Premises, Parking and Common Areas.\n\n      2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases from\nLessor, the Premises, for the term, at the rental, and upon all of the terms,\ncovenants and conditions set forth in this Lease. Unless otherwise provided\nherein, any statement of square footage set forth in this Lease, or that may\nhave been used in calculating rental and\/or Common Area Operating Expenses, is\nan approximation which Lessor and Lessee agree is reasonable and Lessee's Share\n(as defined in Paragraph 1.6(b)) based thereon is not subject to revision\nwhether or not the actual square footage is more or less.\n\n      2.2 Condition. Lessor shall deliver the Premises to Lessee clean and free\nof debris on the Commencement Date and warrants to Lessee that the existing\nplumbing, electrical systems, fire sprinkler system. lighting, air conditioning\nand heating systems and loading doors, if any, in the Premises, other than those\nconstructed by Lessee, shall be in operating condition on the Commencement Date.\nIf a non-compliance with said warranty exists as of the Commencement Date,\nLessor shall, except as otherwise provided in this Lease, promptly after receipt\nof written notice from Lessee setting forth with specificity the nature and\nextent of such non-compliance, rectify same at Lessor's expense. If Lessee does\nnot give Lessor written notice of a non-compliance with this warranty within\nthirty (30) days after the Commencement Date, correction of that non-compliance\nshall be the obligation of Lessee at Lessee's sole cost and expense.\n\n      2.3 Compliance with Covenants, Restrictions and Building Code. Lessor\nwarrants that any improvements (other than those constructed by Lessee or at\nLessee's direction) shall comply with all applicable covenants or restrictions\nof record and applicable building codes, regulations and ordinances in effect on\nthe Commencement Date. Lessor further warrants to Lessee that Lessor has no\nknowledge of any claim having been made by any governmental agency that a\nviolation or violations of applicable building codes, regulations, or ordinances\nexist with regard to the Premises as of the Commencement Date. Said warranties\nshall not apply to any Alterations or Utility Installations (defined in\nParagraph 7.3 (a)) made or to be made by Lessee. If the Premises do not comply\nwith said warranties, Lessor shall, except as otherwise provided in this Lease,\npromptly after receipt of written notice from Lessee given within six (6) months\nfollowing the Commencement Date and setting forth with specificity the nature\nand extent of such non-compliance, take such action, at Lessor's expense, as may\nbe reasonable or appropriate to rectify the non-compliance. Lessor makes no\nwarranty that the Permitted Use in Paragraph 1.8 is permitted for the Premises\nunder Applicable Laws (as defined in Paragraph 2.4).\n\n      2.4 Acceptance of Premises. Lessee hereby acknowledges: (a) that it has\nbeen advised by the Broker(s) to satisfy itself with respect to the condition of\nthe Premises (including but not limited to the electrical and fire sprinkler\nsystems, security, environmental aspects, and compliance with the Americans with\nDisabilities Act and applicable zoning, municipal, county, state and federal\nlaws, ordinances and regulations and any covenants or restrictions of record\n(collectively, \"Applicable Laws\") and the present and future suitability of the\nPremises for Lessee's intended use; (b) that Lessee has made such investigation\nas it deems necessary with reference to such matters, is satisfied with\nreference thereto, and assumes all responsibility therefore as the same relate\nto Lessee's occupancy of the Premises and\/or the terms of this Lease; and (c)\nthat neither Lessor, nor any of Lessor's agents, has made any oral or written\nrepresentations or warranties with respect to said matters other than as set\nforth in this Lease.\n\n \n      2.6 Vehicle Parking. Lessee shall be entitled to use the number of\nUnreserved Parking Spaces and Reserved Parking Spaces specified in Paragraph\n1.2(b) on those portions of the Common Areas designated from time to time by\nLessor for parking. Lessee shall not use more parking spaces than said number.\nSaid parking spaces shall be used for parking by vehicles no larger than\nfull-size passenger automobiles or pick-up trucks, herein called \"Permitted Size\nVehicles.\" Vehicles other than Permitted Size Vehicles shall be parked and\nloaded or unloaded as directed by Lessor in the Rules and Regulations (as\ndefined in Paragraph 40) issued by Lessor. (Also see Paragraph 2.9.)\n\n            (a) Lessee shall not permit or allow any vehicles that belong to or\nare controlled by Lessee or Lessee's employees, suppliers, shippers, customers,\ncontractors or invitees to be loaded, unloaded, or parked in areas other than\nthose designated by Lessor for such activities.\n\n            (b) If Lessee permits or allows any of the prohibited activities\ndescribed in this Paragraph 2.6, then Lessor shall have the right, without\nnotice to Lessee, in addition to such other rights and remedies that it may\nhave, to remove or tow away the vehicle involved and charge the cost to Lessee,\nwhich cost shall be immediately payable upon demand by Lessor.\n\n            (c) Lessor shall at the Commencement Date of this Lease, provide the\nparking facilities required by Applicable Law.\n\n      2.7 Common Areas - Definition. The term \"Common Areas\" is defined as all\nareas and facilities outside the Premises and within the exterior boundary line\nof the Industrial Center and interior utility raceways within the Premises that\nare provided and designated by the Lessor from time to time for the general\nnon-exclusive use of Lessor, Lessee and other lessees of the Industrial Center\nand their respective employees, suppliers, shippers, customers, contractors and\ninvitees, including parking areas, loading and unloading areas, trash areas,\nroadways, sidewalks, walkways, parkways, driveways and landscaped areas.\n\n      2.8 Common Areas - Lessee's Rights. Lessor hereby grants to Lessee, for\nthe benefit of Lessee and its employees, suppliers, shippers, contractors,\ncustomers and invitees, during the term of this Lease, the non-exclusive right\nto use, in common with others entitled to such use, the Common Areas as they\nexist from time to time, subject to any rights, powers, and privileges reserved\nby Lessor under the terms hereof or under the terms of any rules and regulations\nor restrictions governing the use of the Industrial Center. Under no\ncircumstances shall the right herein granted to use the Common Areas be deemed\nto include the right to store any property, temporarily or permanently, in the\nCommon Areas. Any such storage shall be permitted only by the prior written\nconsent of Lessor or Lessor's designated agent, which consent may be revoked at\nany time. In the event that any unauthorized storage shall occur then Lessor\nshall have the right, without notice, in addition to such other rights and\nremedies that it may have, to remove the property and charge the cost to Lessee,\nwhich cost shall be immediately payable upon demand by Lessor.\n\n      2.9 Common Areas - Rules and Regulations. Lessor or such other person(s)\nas Lessor may appoint shall have the exclusive control and management of the\nCommon Areas and shall have the right, from time to time, to establish, modify,\namend and enforce reasonable, Rules and Regulations with respect thereto in\naccordance with Paragraph 40. Lessee agrees to abide by and conform to all such\nRules and Regulations, and to cause its employees, suppliers, shippers,\ncustomers, contractors and invitees to so abide and conform. Lessor shall not be\nresponsible to Lessee for the non-compliance with said rules and regulations by\nother lessees of the Industrial Center.\n\n      2.10 Common Areas - Changes. Lessor shall have the right, in Lessor's sole\ndiscretion, from time to time:\n\n            (a) To make changes to the Common Areas, including, without\nlimitation, changes in the location, size, shape and number of driveways,\nentrances, parking areas, loading and unloading areas, ingress, egress,\ndirection of traffic, landscaped areas, walkways and utility raceways;\n\n            (b) To close temporarily any of the Common Areas for maintenance\npurposes so long as reasonable access to the Premises remains available;\n\n            (c) To designate other land outside the boundaries of the Industrial\nCenter to be a part of the Common Areas (but Common Area Operating Expenses\nshall not be increased as a result of any such designation);\n\n            (d) To add additional buildings and improvements to the Common Areas\n\n            (e) To use the Common Areas while engaged in making additional\nimprovements, repairs or alterations to the Industrial Center, or any portion\nthereof; and\n\n            (f) To do and perform such other acts and make such other changes\nin, to or with respect to the Common Areas and Industrial Center as Lessor may,\nin the exercise of sound business judgment, deem to be appropriate.\n\n3. Term.\n\n      3.1 Term. The Commencement Date, Expiration Date and Original Term of this\nLease are as specified in Paragraph 1.3.\n\n      3.2 Early Possession. If an Early Possession Date is specified in\nParagraph 11.4 and if Lessee totally or partially occupies the Premises after\nthe early Possession Date but prior to the Commencement Date, the obligation to\npay Base Rent shall be abated for the period of such early occupancy. All other\nterms of this lease, however, (including but not limited to carry the insurance\nrequired by Paragraph 8) shall be in effect during such period. Any such early\npossession shall not affect nor advance the Expiration Date of the Original\nTerm.\n\n      3.3 Delay in Possession. If for any reason Lessor cannot deliver\npossession of the Premises to Lessee by the Early Possession Date, if one is\nspecified in Paragraph 1.4, or if no Early Possession Date is specified, by the\nCommencement Date, Lessor shall not be subject to any liability therefor, nor\nshall such failure affect the validity of this Lease, or the obligations of\nLessee hereunder, or extend the term hereof, but in such case, Lessee shall not,\nexcept as otherwise provided herein, be obligated to pay rent or perform any\nother obligation of Lessee under the terms of this Lease until Lessor delivers\npossession of the Premises to Lessee. If possession of the Premises is not\ndelivered to Lessee within sixty (60) days after the Commencement Date, Lessee\nmay, at its option, by notice in writing to Lessor within ten (10) days after\nthe end of said sixty (60) day period, cancel this Lease, in which event the\nparties shall be discharged from all obligations hereunder; provided further,\nhowever, that if such written notice of Lessee is not received by Lessor within\nsaid ten (10) day period, Lessee's right to cancel this lease hereunder shall\nterminate and be of no further force or effect. Except as may be otherwise\nprovided, and regardless of when the Original Term actually commences, if\npossession is not tendered to Lessee when required by this Lease and Lessee does\nnot terminate this Lease, as aforesaid, the period free of the obligation to pay\nBase Rent, if any, that Lessee would otherwise have enjoyed shall run from the\ndate of delivery of possession and continue for a period equal to the period\nduring which the Lessee would have otherwise enjoyed under the terms hereof, but\nminus any days of delay caused by the acts, changes or omissions of Lessee.\n\n4. Rent.\n\n      4.1 Base Rent. Lessee shall pay Base Rent and other rent or charges, as\nthe same may be adjusted from time to time, to Lessor in lawful money of the\nUnited States, without offset or deduction, on or before the day on which it is\ndue under the terms of this Lease. Base Rent and all other rent and charges for\nany period during the term hereof which is for less than one full month shall be\nprorated based upon the actual number of days of the month involved. Payment of\nBase Rent and other charges shall be made to Lessor at its address stated herein\nor to such other persons or at such other addresses as Lessor may from time to\ntime designate in writing to Lessee.\n\n\n                                      -2-\n\n \n5. Security Deposit. Lessee shall deposit with Lessor upon Lessee's execution\nhereof the Security Deposit set forth in Paragraph 1.7 as security for Lessee's\nfaithful performance of Lessee's obligations under this Lease. If Lessee fails\nto pay Base Rent or other rent or charges due hereunder, or otherwise Defaults\nunder this Lease (as defined in Paragraph 13.1), Lessor may use, apply or retain\nall or any portion of said Security Deposit for the payment of any amount due\nLessor or to reimburse or compensate Lessor for any liability, cost, expense,\nloss or damage (including attorneys' fees) which Lessor may suffer or incur by\nreason thereof. If Lessor uses or applies all or any portion of said Security\nDeposit, Lessee shall within ten (10) days after written request therefore\ndeposit monies with Lessor sufficient to restore said Security Deposit to the\nfull amount required by this Lease. Any time the Base Rent increases during the\nterm of this Lease, Lessee shall, upon written request from Lessor, deposit\nadditional monies with Lessor as an addition to the Security Deposit so that the\ntotal amount of the Security Deposit shall at all times bear the same proportion\nto the then current Base Rent as the initial Security Deposit bears to the\ninitial Base Rent set forth in Paragraph 1.5. Lessor shall not be required to\nkeep all or any part of the Security Deposit separate from its general accounts.\nLessor shall, at the expiration or earlier termination of the term hereof and\nafter Lessee has vacated the Premises, return to Lessee (or, at Lessor's option,\nto the last assignee, if any, of Lessee's interest herein), that portion of the\nSecurity Deposit not used or applied by Lessor. Unless otherwise expressly\nagreed in writing by Lessor, no part of the Security Deposit shall be considered\nto be held in trust, to bear interest or other increment for its use, or to be\nprepayment for any monies to be paid by Lessee under this Lease.\n\n6. Use.\n\n      6.1 Permitted Use.\n\n            (a) Lessee shall use and occupy the Premises only for the Permitted\nUse set forth in Paragraph 1.8, or any other legal use which is reasonably\ncomparable thereto, and for no other purpose. Lessee shall not use or permit the\nuse of the Premises in a manner that is unlawful, creates waste or a nuisance,\nor that disturbs owners and\/or occupants of, or causes damage to the Premises or\nneighboring premises or properties.\n\n            (b) Lessor hereby agrees to not unreasonably withhold or delay its\nconsent to any written request by Lessee, Lessee's assignees or subtenants, and\nby prospective assignees and subtenants of Lessee, its assignees and subtenants,\nfor a modification of said Permitted Use, so long as the same will not impair\nthe structural integrity of the improvements on the Premises or in the Building\nor the mechanical or electrical systems therein, does not conflict with uses by\nother lessees, is not significantly more burdensome to the Premises or the\nBuilding and the improvements thereon, and is otherwise permissible pursuant to\nthis Paragraph 6. If Lessor elects to withhold such consent, Lessor shall within\nfive (5) business days after such request give a written notification of same,\nwhich notice shall include an explanation of Lessor's reasonable objections to\nthe change in use.\n\n      6.2 Hazardous Substances. \n\n            (a) Reportable Uses Require Consent. The term \"Hazardous Substance\"\nas used in this Lease shall mean any product, substance, chemical, material or\nwaste whose presence, nature, quantity and\/or intensity of existence, use,\nmanufacture, disposal, transportation, spill, release or effect, either by\nitself or in combination with other materials expected to be on the Premises, is\neither: (i) potentially injurious to the public health, safety or welfare, the\nenvironment, or the Premises; (ii) regulated or monitored by any governmental\nauthority; or (iii) a basis for potential liability of Lessor to any\ngovernmental agency or third party under any applicable statute or common law\ntheory. Hazardous Substance shall include, but not be limited to, hydrocarbons,\npetroleum, gasoline, crude oil or any products or by-products thereof. Lessee\nshall not engage in any activity in or about the Premises which constitutes a\nReportable Use (as hereinafter defined) of Hazardous Substances without the\nexpress prior written consent of Lessor and compliance in a timely manner (at\nLessee's sole cost and expense) with all Applicable Requirements (as defined in\nParagraph 6.3). \"Reportable Use\" shall mean (i) the installation or use of any\nabove or below ground storage tank, (ii) the generation, possession, storage,\nuse, transportation, or disposal of a Hazardous Substance that requires a permit\nfrom, or with respect to which a report, notice, registration or business plan\nis required to be filed with, any governmental authority, and (iii) the presence\nin, on or about the Premises of a Hazardous Substance with respect to which any\nApplicable Laws require that a notice be given to persons entering or occupying\nthe Premises or neighboring properties. Notwithstanding the foregoing, Lessee\nmay, without Lessor's prior consent, but upon notice to Lessor and in compliance\nwith all Applicable Requirements, use any ordinary and customary materials\nreasonably required to be used by Lessee in the normal course of the Permitted\nUse, so long as such use is not a Reportable Use and does not expose the\nPremises or neighboring properties to any meaningful risk of contamination or\ndamage or expose Lessor to any liability therefor. In addition, Lessor may (but\nwithout any obligation to do so) condition its consent to any Reportable Use of\nHazardous Substance by Lessee upon Lessee's giving Lessor such additional\nassurances as Lessor, in its reasonable discretion, deems necessary to protect\nitself, the public, the Premises and the environment against damage,\ncontamination or injury and\/or liability therefor, including but not limited to\nthe installation (and, at Lessor's option, removal on or before Lease expiration\nor earlier termination) or reasonably necessary protective modifications to the\nPremises (such as concrete encasements) and\/or the deposit of an additional\nSecurity Deposit under Paragraph 5 hereof.\n\n            (b) Duty to Inform Lessor. If Lessee knows, or has reasonable cause\nto believe, that a Hazardous Substance has come to be located in, on, under or\nabout the Premises, other than as previously consented to by Lessor, Lessee\nshall immediately give Lessor written notice thereof, together with a copy of\nany statement, report, notice, registration, application, permit, business plan,\nlicense, claim, action, or proceeding given to, or received from, any\ngovernmental authority or private party concerning the presence, spill, release,\ndischarge of, or exposure to, such Hazardous Substance including but not limited\nto all such documents as may be involved in any Reportable Use involving the\nPremises. Lessee shall not cause or permit any Hazardous Substance to be spilled\nor released in, on, under or about the Premises (including, without limitation,\nthrough the plumbing or sanitary sewer system).\n\n            (c) Indemnification. Lessee shall indemnify, protect, defend and\nhold Lessor, its agents, employees, lenders and ground lessor, if any, and the\nPremises, harmless from and against any and all damages, liabilities, judgments,\ncosts, claims, liens, expenses, penalties, loss of permits and attorneys' and\nconsultants' fees arising out of or involving any Hazardous Substance brought\nonto the Premises by or for Lessee or by anyone under Lessee's control. Lessee's\nobligations under this Paragraph 6.2(c) shall include, but not be limited to,\nthe effects of any contamination or injury to person, property or the\nenvironment created or permitted by Lessee, and the cost of investigation\n(including consultants' and attorneys' fees and testing), removal, remediation,\nrestoration and\/or abatement thereof, or of any contamination therein involved,\nand shall survive the expiration or earlier termination of this Lease. No\ntermination, cancellation or release agreement entered into by Lessor and Lessee\nshall release Lessee from its obligations under this Lease with respect to\nHazardous Substances, unless specifically so agreed by Lessor in writing at the\ntime of such agreement.\n\n      6.3 Lessee's Compliance with Requirements. Lessee shall, at Lessee's sole\ncost and expense, fully, diligently and in a timely manner, comply with all\n\"Applicable Requirements,\" which term is used in this Lease to mean all laws,\nrules, regulations, ordinances, directives, covenants, easements and\nrestrictions of record, permits, the requirements of any applicable fire\ninsurance underwriter or rating bureau, and the recommendations of lessor's\nengineers and\/or consultants, relating in any manner to the Premises (including\nbut not limited to matters pertaining to (i) industrial hygiene, (ii)\nenvironmental conditions on, in, under or about the Premises, including soil and\ngroundwater conditions, and (iii) the use, generation, manufacture, production,\ninstallation, maintenance, removal, transportation, storage, spill, or release\nof any Hazardous Substance), now in effect or which may hereafter come into\neffect. Lessee shall, within five (5) days after receipt of Lessor's written\nrequest, provide Lessor with copies of all documents and information, including\nbut not limited to permits, registrations, manifests, applications, reports and\ncertificates, evidencing Lessee's compliance with any Applicable Requirements\nspecified by Lessor; and shall immediately upon receipt, notify Lessor in\nwriting (with copies of any documents involved) of any threatened or actual\nclaim, notice, citation, warning, complaint or report pertaining to or involving\nfailure by Lessee or the Premises to comply with any Applicable Requirements.\n\n      6.4 Inspection; Compliance with Law. Lessor, Lessor's agents, employees,\ncontractors and designated representatives, and the holders of any mortgages,\ndeeds of trust or ground leases on the Premises (\"Lenders\") shall have the right\nto enter the Premises at any time in the case of an emergency, and otherwise at\nreasonable times, for the purpose of inspecting the condition of the Premises\nand for verifying compliance by Lessee with this Lease and all Applicable\nRequirements (as defined in Paragraph 6.3), and Lessor shall be entitled to\nemploy experts and\/or consultants in connection therewith to advise Lessor with\nrespect to Lessee's activities, including but not limited to Lessee's\ninstallation, operation, use, monitoring, maintenance, or removal of any\nHazardous Substance on or from the Premises. The costs and expenses of any such\ninspections shall be paid by the party requesting same, unless a violation of\nApplicable Requirements or a contamination, caused or materially contributed to\nby Lessee, is found to exist, or unless the inspection is requested or ordered\nby a governmental authority as the result of any such existing violation or\ncontamination. In such case, Lessee shall, within twenty (20) days after receipt\nof invoice, reimburse Lessor or Lessor's Lender, as the case may be, for the\ncosts and expenses of such inspections.\n\n7. Maintenance, Repairs, Utility Installations, Trade Fixtures and Alterations.\n\n      7.1 Lessee's Obligations.\n\n            (a) Subject to the provisions of Paragraphs 2.2 (Condition), 2.3\n(Compliance with Covenants, Restrictions and Building Code), 7.2 (Lessor's\nObligations), 9 (Damage or Destruction), and 14 (Condemnation), Lessee shall, at\nLessee's sole cost and expense and at all times, keep the Premises and every\npart thereof in good order, condition and repair (whether or not such portion of\nthe Premises requiring repair, or the means of repairing the same, are\nreasonably or readily accessible to Lessee, and whether or not the need for such\nrepairs occurs as a result of Lessee's use, any prior use, the elements or the\nage of such portion of the Premises), including, without limiting the generality\nof the foregoing, all equipment, or facilities specifically serving the\nPremises, such as plumbing, heating, air conditioning, ventilating, electrical,\nlighting facilities, boilers, fired or unfired pressure vessels, fire hose\nconnections if within the Premises, fixtures, interior walls, interior surfaces\nof exterior walls, ceilings, floors windows, doors, plate glass, and skylights,\nbut excluding any items which are responsibility of Lessor pursuant to Paragraph\n7.2 below. Lessee, in keeping the Premises in good order, condition and repair,\nshall exercise and perform good maintenance practices. Lessee's obligations\nshall include restorations, replacements or renewals when necessary to keep the\nPremises and all improvements thereon or a part thereof in good order, condition\nand state of repair.\n\n            (c) If Lessee fails to perform Lessee's obligations under this\nParagraph 7.1, Lessor may enter upon the Premises after ten (10) days' prior\nwritten notice to Lessee (except in the case of an emergency, in which case no\nnotice shall be required), perform such obligations on Lessee's behalf, and put\nthe Premises in good order, condition and repair, in accordance with Paragraph\n13.2 below.\n\n      7.2 Lessor's Obligations. Subject to the provisions of Paragraphs 2.2\n(Condition), 2.3 (Compliance with Covenants, Restrictions and Building Code),\n4.2 (Common Area Operating Expenses). 6 (Use), 7.1 (Lessee's Obligations), 9\n(Damage or Destruction) and 14 (Condemnation), Lessor, subject to reimbursement\npursuant to Paragraph 4.2, shall keep in good order, condition and repair the\nfoundations, exterior walls and structural condition of interior bearing walls,\nexterior roof, fire sprinkler and\/or standpipe and hose (if located in the \nCommon Areas) or other automatic fire extinguishing system including fire alarm\n\n\n                                      -3-\n\n \nand\/or smoke detection systems and equipment, fire hydrants, parking lots,\nwalkways, parkways, driveways, landscaping, fences, signs and utility \nsystems serving the Common Areas and all parts thereof, as\nwell as providing the services for which there is a Common Area Operating\nExpense pursuant to Paragraph 4.2. Lessor shall not be obligated to paint the\nexterior or interior surfaces of exterior walls nor shall Lessor be obligated to\nmaintain, repair or replace windows, doors or plate glass of the Premises.\nLessee expressly waives the benefit of any statute now or hereafter in effect\nwhich would otherwise afford Lessee the right to make repairs at Lessor's\nexpense or to terminate this Lease because of Lessor's failure to keep the\nBuilding, Industrial Center or Common Areas in good order, condition and repair.\n\n      7.3 Utility Installations, Trade Fixtures, Alterations.\n\n            (a) Definitions; Consent Required. The term \"Utility Installations\"\nis used in this Lease to refer to all air lines, power panels, electrical\ndistribution, security, fire protection systems, communications systems,\nlighting fixtures, heating, ventilating and air conditioning equipment,\nplumbing, and [ILLEGIBLE] in, or about the Premises. The term \"Trade Fixtures\"\nshall mean Lessee's machinery and equipment which can be removed without doing\nmaterial damage to the Premises. The term \"Alterations\" shall mean any\nmodification of the improvements on the Premises which are provided by the\nLessor under the terms of this Lease, other than Utility Installations or Trade\nFixtures. \"Lessee-Owned Alterations and\/or Utility Installations\" are defined as\nAlterations and\/or Utility Installations made by Lessee that are not yet owned\nby Lessor pursuant to Paragraph 7.4(a). Lessee shall not make nor cause to be\nmade any Alterations or Utility Installations in, on, under or about the\nPremises without Lessor's prior written consent. Lessee may, however, make\nnon-structural Utility Installations to the interior of the Premises (excluding\nthe roof) without Lessor's consent but upon notice to Lessor, so long as they\nare not visible from the outside of the Premises, do not involve puncturing,\nrelocating or removing the roof or any existing walls, or changing or\ninterfering with the fire sprinkler or fire detection systems and the cumulative\ncost thereof during the term of this Lease as extended does not exceed\n$2,500.00.\n\n            (b) Consent. Any Alterations or Utility Installations that Lessee\nshall desire to make and which require the consent of the Lessor shall be\npresented to Lessor in written form with detailed plans. All consents given by\nLessor, whether by virtue of Paragraph 7.3(a) or by subsequent specific consent,\nshall be deemed conditioned upon: (i) Lessee's acquiring all applicable permits\nrequired by governmental authorities; (ii) the furnishing of copies of such\npermits together with a copy of the plans and specifications for the Alteration\nor Utility Installation to Lessor prior to commencement of the work thereon; and\n(iii) the compliance by Lessee with all conditions of said permits in a prompt\nand expeditious manner. Any Alterations or Utility Installations by Lessee\nduring the term of this Lease shall be done in a good and workmanlike manner,\nwith good and sufficient materials, and be in compliance with all Applicable\nRequirements. Lessee shall promptly upon completion thereof furnish Lessor with\nas-built plans and specifications therefor. Lessor may, (but without obligation\nto do so) condition its consent to any requested Alteration or Utility\nInstallation that costs $2,500.00 or more upon Lessee's providing Lessor with a\nlien and completion bond in an amount equal to one and one-half times the\nestimated cost of such Alteration or Utility Installation.\n\n            (c) Lien Protection. Lessee shall pay when due all claims for labor\nor materials furnished or alleged to have been furnished to or for Lessee at or\nfor use on the Premises, which claims are or may be secured by any mechanic's or\nmaterialmen's lien against the Premises or any interest therein. Lessee shall\ngive Lessor not less than ten (10) days' notice prior to the commencement of any\nwork in, on, or about the Premises, and Lessor shall have the right to post\nnotices of non-responsibility in or on the Premises as provided by law. If\nLessee shall, in good faith, contest the validity of any such lien, claim or\ndemand, then Lessee shall, at its sole expense, defend and protect itself,\nLessor and the Premises against the same and shall pay and satisfy any such\nadverse judgment that may be rendered thereon before the enforcement thereof\nagainst the Lessor or the Premises. If Lessor shall require, Lessee shall\nfurnish to Lessor a surety bond satisfactory to Lessor in an amount equal to one\nand one-half times the amount of such contested lien claim or demand,\nindemnifying Lessor against liability for the same, as required by law for the\nholding of the Premises free from the effect of such lien or claim. In addition,\nLessor may require Lessee to Lessor's attorney's fees and costs in participating\nin such action if Lessor shall decide it is to its best interest to do so.\n\n      7.4 Ownership, Removal, Surrender, and Restoration.\n\n            (a) Ownership. Subject to Lessor's right to require their removal\nand to cause Lessee to become the owner thereof as hereinafter provided in this\nParagraph 7.4, all Alterations and Utility Installations made to the Premises by\nLessee shall be the property of and owned by Lessee, but considered a part of\nthe Premises, Lessor may, at any time and at its option, elect in writing to\nLessee to be the owner of all or any specified part of the Lessee-Owned\nAlterations and Utility Installations shall, at the expiration or earlier\ntermination of this Lease, become the property of Lessor and remain upon the\nPremises and be surrendered with the Premises by Lessee.\n\n            (b) Removal. Unless otherwise agreed in writing, Lessor may require\nthat any or all Lessee-Owned Alterations or Utility Installations be [ILLEGIBLE]\nby the expiration or earlier termination of this Lease, notwithstanding that\ntheir installation may have been consented to by Lessor. Lessor may [ILLEGIBLE]\nthe removal at any time of all or part of any Alterations or Utility\nInstallations made without the required consent of Lessor.\n\n            (c) Surrender\/Restoration. Lessee shall surrender the Premises by\nthe end of the last day of the Lease term or any earlier termination date, clean\nand free of debris and in good operating order, condition and state of repair,\nordinary wear and tear excepted. Ordinary wear and tear shall not include any\ndamage or deterioration that would have been prevented by good maintenance\npractice or by Lessee performing all of its obligations under this Lease. Except\nas otherwise agreed or specified herein, the Premises, as surrendered, shall\ninclude the Alterations and Utility Installations. The obligation of Lessee\nshall include the repair of any damage occasioned by the installation,\nmaintenance or removal of Lessee's Trade Fixtures, furnishings, equipment, and\nLessee-Owned Alterations and Utility Installations, as well as the removal of\nany storage tank installed by or for Lessee, and the removal, replacement, or\nremediation of any soil, material or ground water contaminated by Lessee, all as\nmay then be required by Applicable Requirements and\/or good practice. Lessee's\nTrade Fixtures shall remain the property of Lessee and shall be removed by\nLessee subject to its obligation to repair and restore the Premises per this\nLease.\n\n8. Insurance; Indemnity.\n\n      8.1 Payment of Premium Increases.\n\n            (a) As used herein, the term \"Insurance Cost Increase\" is defined as\nany increase in the actual cost of the insurance applicable to the Building and\nrequired to be carried by Lessor pursuant to Paragraph 8.2(b), 8.3(a) and\n8.3(b), (\"Required Insurance\"), over and above the Base Premium, as hereinafter\ndefined, calculated on an annual basis. \"Insurance Cost Increase\" shall include,\nbut not be limited to, requirements of the holder of a mortgage or deed of trust\ncovering the Premises, increased valuation of the Premises, and\/or a general\npremium rate increase. The term \"Insurance Cost Increase\" shall not, however,\ninclude any premium increases resulting from the nature of the occupancy of any\nother lessee of the Building. If the parties insert a dollar amount in Paragraph\n1.9, such amount shall be considered the \"Base Premium.\" If a dollar amount has\nnot been inserted in Paragraph 1.9 and if the Building has been previously\noccupied during the twelve (12) month period immediately preceding the\nCommencement Date, the \"Base Premium\" shall be the annual premium applicable to\nsuch twelve (12) month period. If the Building was not fully occupied during\ntwelve (12) month period, the \"Base Premium\" shall be the lowest annual premium\nreasonably obtainable for the Required Insurance as of the Commencement Date,\nassuming the most nominal use possible of the Building. In no event, however,\nshall Lessee be responsible for any portion of the premium cost attributable to\nliability Insurance coverage in excess of $1,000,000 procured under Paragraph\n8.2(b).\n\n            (b) Lessee shall pay any Insurance Cost Increase to Lessor pursuant\nto Paragraph 4.2 Premiums for policy periods commencing prior to, or extending\nbeyond, the term of this Lease shall be prorated to coincide with the\ncorresponding Commencement Date or Expiration Date.\n\n      8.2 Liability Insurance.\n\n            (a) Carried by Lessee. Lessee shall obtain and keep in force during\nthe term of this Lease a Commercial General Liability policy of insurance\nprotecting Lessee, Lessor and any Lender(s) whose names have been provided to\nLessee in writing (as additional insureds) against claims for bodily injury,\npersonal injury and property damage based upon, involving or arising out of the\nownership, use, occupancy or maintenance of the Premises and all areas\nappurtenant thereto. Such insurance shall be on an occurrence basis providing\nsingle limit coverage in an amount not less than $1,000,000 per occurrence with\nan \"Additional Insured-Managers or Lessors of Premises\" endorsement and contain\nthe \"Amendment of the Pollution Exclusion\" endorsement for damage caused by\nheat, smoke or fumes from a hostile fire. The policy shall not contain any\nintra-insured exclusions as between insured persons or organizations, but shall\ninclude coverage for liability assumed under this Lease as an \"insured contract\"\nfor the performance of Lessee's indemnity obligations under this Lease. The\nlimits of said insurance required by this Lease or as carried by Lessee shall\nnot, however, limit the liability of Lessee nor relieve Lessee of any obligation\nhereunder. All insurance to be carried by Lessee shall be primary to and not\ncontribution with any similar insurance carried by Lessor, whose insurance shall\nbe considered excess insurance only.\n\n            (b) Carried by Lessor. Lessor shall also maintain liability\ninsurance described in Paragraph 8.2(a) above, in addition to and not in lieu\nof, the insurance required to be maintained by Lessee. Lessee shall not be named\nas an additional insured therein.\n\n      8.3 Property Insurance-Building, Improvements and Rental Value.\n\n            (a) Building and Improvements. Lessor shall obtain and keep in force\nduring the term of this Lease a policy or policies in the name of Lessor, with\nloss payable to Lessor and to any Lender(s), insuring against loss or damage to\nthe Premises. Such insurance shall be for full replacement cost, as the same\nshall exist from time to time, or the amount required by any Lender(s), but in\nno event more than the commercially reasonable and available insurable value\nthereof if, by reason of the unique nature or age of the improvements involved,\nsuch latter amount is less than full replacement cost. Lessee-Owned Alterations\nand Utility Installations, Trade Fixtures and Lessee's personal property shall\nbe insured by Lessee pursuant to Paragraph 8.4. If the coverage is available and\ncommercially appropriate, Lessor's policy or policies shall insure against all\nrisks of direct physical loss or damage (except the perils of flood and\/or\nearthquake unless required by a Lender or included in the base premium),\nincluding coverage for any additional costs resulting from debris removal and\nreasonable amounts of coverage for the enforcement of any ordinance or law\nregulating the reconstruction or replacement of any undamaged sections of the\nBuilding required to be demolished or removed by reason of the enforcement of\nany building, zoning, safety or land use laws as the result of a covered loss,\nbut not including plate glass insurance. Said policy or policies shall also\ncontain an agreed valuation provision in lieu of any co-insurance clause, waiver\nof subrogation, and inflation guard protection causing an increase in the annual\nproperty insurance coverage amount by a factor of not less than the adjusted\nU.S. Department of Labor Consumer Price Index for All Urban Consumers for the\ncity nearest to where the Premises are located.\n\n            (b) Rental Value. Lessor shall also obtain and keep in force during\nthe term of this Lease a policy or policies in the name of Lessor, with loss\npayable to Lessor and any Lender(s), insuring the loss of the full rental and\nother charges payable by all lessees of the Building to Lessor for one year\n(including all Real Property Taxes, insurance costs, all Common Area Operating\nExpenses and any scheduled rental increases). Said insurance may provide that in\nthe event the Lease is terminated by reason of an insured loss, the period of\nindemnity for such coverage shall be extended beyond the date of the completion\nof repairs or replacement of the Premises, to provide for one full year's loss\nof rental revenues from the date of any such loss. Said insurance shall contain\nan agreed valuation provision in lieu of any co-insurance clause, and the amount\nof coverage shall be adjusted annually to reflect the projected rental income,\nReal Property Taxes, insurance premium costs and other expenses, if any,\notherwise payable, for the next 12-month period. Common Area Operating Expenses\nshall include any deductible amount in the event of such loss.\n\n            (c) Adjacent Premises. Lessee shall pay for any increase in the\npremiums for the property insurance of the Building and for the Common Areas or\nother buildings in the Industrial Center if said increase is caused by Lessee's\nacts, omissions, use or occupancy of the Premises.\n\n\n                                      -4-\n\n \n            (d) Lessee's Improvements. Since Lessor is the Insuring Party,\nLessor shall not be required to insure Lessee-Owned Alterations and Utility\nInstallations unless the item in question become the property of Lessor under\nthe terms of this Lease.\n\n      8.4 Lessee's Property Insurance. Subject to the requirements of Paragraph\n8.5, Lessee at its cost shall either by separate policy or, at Lessor's option,\nby endorsement to a policy already carried, maintain insurance coverage on all\nof Lessee's personal property, Trade Fixtures and Lessee-Owned Alterations and\nUtility Installations in, on, or about the Premises similar in coverage to that\ncarried by Lessor as the Insuring Party under Paragraph 8.3(a). Such insurance\nshall be full replacement cost coverage with a deductible not to exceed $50,000\nper occurrence. The proceeds from any such insurance shall be used by Lessee for\nthe replacement of personal property and the restoration of Trade Fixtures and\nLessee-Owned Alterations and Utility Installations. Upon request from Lessor,\nLessee shall provide Lessor with written evidence that such insurance is in\nforce.\n\n      8.5 Insurance Policies. Insurance required hereunder shall be in companies\nduly licensed to transact business in the state where the Premises are located,\nand maintaining during the policy term a \"General Policyholders Rating\" of at\nleast B+, V, or such other rating as may be required by a Lender, as set forth\nin the most current issue of \"Best's Insurance Guide.\" Lessee shall not do or\npermit to be done anything which shall invalidate the insurance policies\nreferred to in this Paragraph 8. Lessee shall cause to be delivered to Lessor,\nwithin seven (7) days after the earlier of the Early Possession Date or the\nCommencement Date, certified copies of, or certificates evidencing the existence\nand amounts of, the insurance required under Paragraph 8.2(a) and 8.4. No such\npolicy shall be cancelable or subject to modification except after thirty (30)\ndays' prior written notice to Lessor. Lessee shall at least thirty (30) days\nprior to the expiration of such policies, furnish Lessor with evidence of\nrenewals or \"insurance binders\" evidencing renewal thereof, or Lessor may order\nsuch insurance and charge the cost thereof to Lessee, which amount shall be\npayable be Lessee to Lessor upon demand.\n\n      8.6 Waiver of Subrogation. Without affecting any other rights or remedies,\nLessee and Lessor each hereby release and relieve the other, and waive their\nentire right to recover damages (whether in contract or in tort) against the\nother, for loss or damage to their property arising out of or incident to the\nperils required to be insured against under Paragraph 8. The effect of such\nreleases and waivers of the right to recover damages shall not be limited by the\namount of insurance carried or required, or by any deductibles applicable\nthereto. Lessor and Lessee agree to have their respective insurance companies\nissuing property damage insurance waive any right to subrogation that such\ncompanies may have against Lessor or Lessee, as the case may be, so long as the\ninsurance is not invalidated thereby.\n\n      8.7 Indemnity. Except for Lessor' negligence and\/or breach of express\nwarranties, Lessee shall indemnify, protect, defend and hold harmless the\nPremises, Lessor and  its agents, Lessor's master or ground lessor, partners\nand Lenders, from and against any and all claims, loss, of rents and\/or damages,\ncosts, liens, judgments, penalties, loss of permits, attorneys' and consultants'\nfees, expenses and\/or liabilities arising out of, involving, or in connection\nwith, the occupancy of the Premises by Lessee, the conduct of Lessee's business,\nany act, omission or neglect of Lessee, its agents, contractors, employees or\ninvitees, and out of any Default or Breach by Lessee in the performance in a\ntimely manner of any obligation on Lessee's part to be performed under this\nLease. The foregoing shall include, but not be limited to, the defense or\npursuit of any claim or any action proceeding involved therein, and whether or\nnot (in case of claims made against Lessor) litigated and\/or reduced to\njudgment. In case any action or proceeding be brought against Lessor by reason\nof any of the foregoing matters, Lessee upon notice from Lessor shall defend the\nsame at Lessee's expense by counsel reasonably satisfactory to Lessor and Lessor\nshall cooperate with Lessee in such defense. Lessor need not have first paid any\nsuch claim in order to be so indemnified.\n\n      8.8 Exemption of Lessor from Liability. Lessor shall not be liable for\ninjury or damage to the person or goods, wares, merchandise or other property of\nLessee's employees, contractors, invitees, customers, or any other person in or\nabout the Premises, whether such damage or injury is caused by or results from\nfire, steam, electricity, gas, water or rain, or from the breakage, leakage,\nobstruction or other defects of pipes, fire sprinklers, wires, appliances,\nplumbing, air conditioning or lighting fixtures, or from any other cause,\nwhether said injury or damage results from conditions arising upon the Premises\nor upon other portions of the Building of which the Premises are a part, from\nother sources or places, and regardless of whether the cause of such damage or\ninjury or the means of repairing the same is accessible or not. Lessor shall not\nbe liable for any damages arising from any act or neglect of any other lessee of\nLessor nor from the failure by Lessor to enforce the provisions of any other\nlease in the Industrial Center. Notwithstanding Lessor's negligence or breach of\nthis Lease, Lessor shall under no circumstances be liable for injury to Lessee's\nor for any loss of income or profit therefrom.\n\n9. Damage or Destruction.\n\n      9.1 Definitions.\n\n            (a) \"Premises Partial Damage\" shall mean damage or destruction to\nthe Premises, other than Lessee-Owned Alterations and Utility installations, the\nrepair cost of which damage or destruction is less than fifty percent (50%) of\nthe then Replacement Cost (as defined in Paragraph 9.1(d)) of Premises\n(excluding Lessee-Owned Alterations and Utility Installations and Trade\nFixtures) immediately prior to such damage or destruction.\n\n            (b) \"Premises Total Destruction\" shall mean damage or destruction to\nthe Premises, other than Lessee-Owned Alterations and Utility Installations, the\nrepair cost of which damage or destruction is fifty percent (50%) or more of the\nthen Replacement Cost of the Premises (excluding Lessee-Owned Alterations and\nUtility installations and Trade Fixtures) immediately prior to such damage or\ndestruction. In addition, damage or destruction to the Building, other than\nLessee-Owned Alterations and Utility Installations and Trade Fixtures of any\nlessees of the Building, the cost of which damage or destruction is fifty\npercent (50%) or more of the then Replacement Cost (excluding Lessee-Owned\nAlterations and Utility Installations and Trade Fixtures of any lessees of the\nBuilding) of the Building shall, at the option of Lessor, be deemed to be\nPremises Total Destruction.\n\n            (c) \"Insured Loss\" shall mean damage or destruction to the Premises,\nother than Lessee-Owned Alterations and Utility Installations and Trade\nFixtures, which was caused by an event required to be covered by the insurance\ndescribed in Paragraph 8.3(a) irrespective of any deductible amounts or coverage\nlimits involved.\n\n            (d) \"Replacement Cost\" shall mean the cost to repair or rebuild the\nimprovements owned by Lessor at the time of the occurrence to their condition\nexisting immediately prior thereto, including demolition, debris removal and\nupgrading required by the operation of applicable building codes, ordinances or\nlaws, and without deduction for depreciation.\n\n            (e) \"Hazardous Substance Condition\" shall mean the occurrence or\ndiscovery of a condition involving the presence of, or a contamination by a\nHazardous Substance as defined in Paragraph 6.2(a), in, on, or under the\nPremises.\n\n      9.2 Premises Partial Damage -- Insured Loss. If Premises Partial Damage\nthat is an Insured Loss occurs, then Lessor shall, at Lessors expense, repair\nsuch damage (but not Lessee's Trade Fixtures or Lessee-Owned Alterations and\nUtility installations) as soon as reasonably possible and this Lease shall\ncontinue in full force and effect. In the event, however, that there is a\nshortage of insurance proceeds and such shortage is due to the fact that by\nreason of the unique nature of the improvements in the Premises, full\nreplacement cost insurance coverage was not commercially reasonable and\navailable, Lessor shall have no obligation to pay for the shortage in insurance\nproceeds or to fully restore the unique aspects of the Premises unless Lessee\nprovides Lessor with the funds to cover same, or adequate assurance thereof,\nwithin ten (10) days following receipt of written notice of such shortage and\nrequest therefor. If Lessor receives said funds or adequate assurance thereof\nwithin said ten (10) day period, Lessor shall complete them as soon as\nreasonably possible and this Lease shall remain in full force and effect, if\nLessor does not receive such funds or assurance within said period, Lessor may\nnevertheless elect by written notice to Lessee within ten (10) days thereafter\nto make such restoration and repair as is commercially reasonable with Lessor\npaying any shortage in proceeds, in which case this Lease shall remain in full\nforce and effect. If Lessor does not receive such funds or assurance within such\nten (10) day period, and if Lessor does not so elect to restore and repair, then\nthis Lease shall terminate sixty (60) days following the occurrence of the\ndamage or destruction. Unless otherwise agreed, Lessee shall in no event have\nany right to reimbursement from Lessor for any funds contributed by Lessee to\nrepair any such damage or destruction. Premises Partial Damage due to flood or\nearthquake shall be subject to Paragraph 9.3 rather than Paragraph 9.2,\nnotwithstanding that there may be some insurance coverage, but the net proceeds\nof any such insurance shall be made available for the repairs if made by either\nParty.\n\n      9.3 Partial Damage - Uninsured Loss. if Premises Partial Damage that is\nnot an Insured Loss occurs, unless caused by a negligent or willful act of\nLessee (in which event Lessee shall make the repairs at Lessees expense and this\nLease shall continue in full force and effect), Lessor may at Lessor's option,\neither (i) repair such damage as soon as reasonably possible at Lessor's\nexpense, in which event this Lease shall continue in full force and effect, or\n(ii) give written notice to Lessee withIn thirty (30) days after receipt by\nLessor of knowledge of the occurrence of such damage of Lessor's desire to\nterminate this Lease [ILLEGIBLE] of the date sixty (60) days following the date\nof such notice. In the event Lessor elects to give such notice of Lessor's\nintention to terminate this Lease, Lessee shall have the right within ten (10)\ndays after the receipt of such notice to give written notice to Lessor of\nLessees commitment to pay for the repair of such damage totally at Lessee's\nexpense and without reimbursement from Lessor. Lessee shall provide Lessor with\nthe required funds or satisfactory assurance thereof within thirty (30) days\nfollowing such commitment from Lessee. In such event this Lease Shall continue\nin full force and effect, and Lessor shall proceed to make such repairs as soon\nas reasonably possible after the required funds are available, if Lessee does\nnot give such notice and provide the funds or assurance thereof within the times\nspecified above, this Lease shall terminate as of the date specified in Lessors\nnotice of termination.\n\n      9.4 Total Destruction. Notwithstanding any other provision hereof, if\nPremises Total Destruction occurs (including any destruction required by any\nauthorized public authority), this Lease shall terminate sixty (60) days\nfollowing the date of such Premises Total Destruction, whether or not the damage\nor destruction is an Insured Loss or was caused by a negligent or willful act of\nLessee. In the event, however, that the damage or destruction was caused by\nLessee, Lessor shall have the right to recover Lessor's damages from Lessee\nexcept as released and waived in Paragraph 9.7.\n\n      9.5 Damage Near End of Term. If at any time during the last six (6) months\nof the term of this Lease there is damage for which the cost to repair exceeds\none month's Base Rent, whether or not an Insured Loss, Lessor may, at Lessor's\noption, terminate this Lease effective sixty (60) days following the date of\noccurrence of such damage by giving written notice to Lessee of Lessor's\nelection to do so within thirty (30) days after the date of occurrence of such\ndamage. Provided, however, if Lessee at that time has an exercisable option to\nextend this Lease or to purchase the Premises, then Lessee may preserve this\nLease by (a) exercising such option, and (b) providing Lessor with any shortage\nin insurance proceeds (or adequate assurance thereof) needed to make the repairs\non or before the earlier of (i) the date which is ten (10) days after Lessee's\nreceipt of Lessor's written notice purporting to terminate this Lease, or (ii)\nthe day prior to the date upon which such option expires. If Lessee duly\nexercises such option during such period and provides Lessor with funds (or\nadequate assurance thereof) to cover any shortage in insurance proceeds, Lessor\nshall, at Lessor's expense repair such damage as soon as reasonably possible and\nthis Lease shall continue in full force and effect. If Lessee fails to exercise\nsuch option and provide such funds or assurance during such period, then this\nLease shall terminate as of the date set forth in the first sentence of this\nParagraph 9.5.\n\n      9.6 Abatement of Rent; Lessee's Remedies.\n\n            (a) In the event of (i) Premises Partial Damage or (ii) Hazardous\nSubstance Condition for which Lessee is not legally responsible, the Bass Rent\nCommon Area Operating Expenses and other charges, if any, payable by Lessee\nhereunder for the period during which such damage or condition, its repair,\nremediation or restoration continues, Shall be abated in proportion to the\ndegree to which Lessee's use of the Premises is impaired, but not in excess of\nproceeds from insurance required to be carried under Paragraph 8.3(b). Except\nfor abatement of Base Rent Common Area Operating Expenses and other charges, if\nany, as aforesaid, all other obligations of Lessee hereunder shall be performed\nby Lessee, and Lessee shall have no claim against Lessee for any damage suffered\nby reason of any such damage, destruction, repair, remediation or restoration.\n\n\n                                      -5-\n\n \n              (b) If Lessor shall be obligated to repair or restore the Premises\nunder the provisions of this Paragraph 9 and shall not commence, in a\nsubstantial and meaningful way, the repair or restoration of the Premises within\nninety (90) days after such obligation shall accrue, Lessee may, at any time\nprior to the commencement of such repair or restoration, give written notice to\nLessor and to any Lenders of which Lessee has actual notice of Lessee's election\nto terminate this Lease on a date not less than sixty (60) days following the\ngiving of such notice. If Lessee gives such notice to Lessor and such Lenders\nand such repair or restoration is not commenced within thirty (30) days after\nreceipt of such notice, this Lease shall terminate as of the date specified in\nsaid notice. If Lessor or a Lender commences the repair or restoration of the\nPremises within thirty (30) days after the receipt of such notice, this Lease\nshall continue in full force and effect \"commence\" as used in this Paragraph 9.6\nshall mean either the unconditional authorization of the preparation of the\nretired plans, or the beginning of the actual work on the Premises, whichever\noccurs first.\n\n      9.7 Hazardous Substance Conditions. If a Hazardous Substance Condition\noccurs, unless Lessee is legally responsible therefor on which case Lessee shall\nmake the investigation and remediation thereof required by Applicable\nRequirements and this Lease shall continue in full force and effect, but subject\nto Lessor's rights under Paragraph 6.2(c) and Paragraph 13), Lessor may at\nLessors option either (i) investigate and remediate such Hazardous Substance\nCondition, if required, as soon as reasonably possible at Lessor's expense, in\nwhich event this Lease shall continue in full force and effect, or (ii) if the\nestimated cost to investigate and remediate such condition exceeds twelve (12)\ntimes the then monthly Base Rent or $100,000 whichever is greater, give written\nnotice to Lessee within thirty (30) days after receipt by Lessor of knowledge of\nthe occurrence of such Hazardous Substance Condition of Lessor's desire to\nterminate this Lease as of the date sixty (60) days following the date of such\nnotice. In the event Lessor elects to give such notice of Lessor's intention to\nterminate this Lease, Lessee shall have the right within ten (10) days after the\nreceipt of such notice to give written notice to Lessor of Lessee's commitment\nto pay for the excess costs of (a) investigation and remediation of such\nHazardous Substance Condition to the extent required by Applicable Requirements,\nover (b) an amount equal to twelve (12) times the then monthly Base Rent or\n$100,000, whichever is greater. Lessee shall provide Lessor with the funds\nrequired of Lessee or satisfactory assurance thereof within thirty (30) days\nfollowing said commitment by Lessee. In such event this Lease shall continue In\nfull force and effect, and Lessor shall proceed to make such investigation and\nremediation as soon as reasonably possible after the required funds are\navailable. If Lessee does not give such notice and provide the required funds or\nassurance thereof within the time period specified above, this Lease shall\nterminate as of the date specified In Lessors notice of termination.\n\n      9.8 Termination - Advance Payments. Upon termination of this Lease\npursuant to this Paragraph 9, Lessor shall return to Lessee any advance payment\nmade by Lessee to Lessor and so much of Lessee's Security Deposit as has not\nbeen, or is not then required to be, used by Lessor under the terms of this\nLease.\n\n      9.9 Waiver of Statutes, Lessor and Lessee agree that the terms of this\nLease shall govern the effect of any damage to or destruction of the Premise and\nthe Building with respect to the termination of this Lease and hereby waive the\nprovisions of any present or future statute to the extent it is inconsistent\ntherewith.\n\n10.   Real Property Taxes.\n\n      10.1 Payment of Taxes. Lessor shall pay the Real Property Taxes, as\ndefined in Paragraph 10.2(a), applicable to the Industrial Center, and except as\notherwise provided in Paragraph 10.3, any increases in such amounts over the\nBase Real Property Taxes shall be included in the calculation of Common Area\nOperating Expenses in accordance with the provisions of Paragraph 4.2.\n\n      10.2 Real Property Tax Definition.\n\n            (a) As used herein, the term \"Real Property Taxes\" shall include any\nform of real estate tax or assessment, general, special, ordinary or\nextraordinary, and any license fee, commercial rental tax, improvement bond or\nbonds, levy or tax (other than inheritance, personal income or estate taxes)\nimposed upon the Industrial Center by any authority having the direct or\nindirect power to tax, including any city, state or federal government, or any\nschool, agricultural, sanitary, fire, street, drainage, or other improvement\ndistrict thereof, levied against any legal or equitable interest of Lessor in\nthe Industrial Center or any portion thereof, Lessor's right to rent or other\nincome therefrom, and\/or Lessor's business of leasing the Premises. The term\n\"Real Property Taxes\" shall also include any tax, fee, levy, assessment or\ncharge, or any increase therein, imposed by reason of events occurring, or\nchanges in Applicable Law taking effect, during the term of this Lease,\nincluding but not limited to a change in the ownership of the Industrial Center\nor in the improvements thereon, the execution of this Lease, or any\nmodification, amendment or transfer thereof, and whether or not contemplated by\nthe Parties.\n\n            (b) As used herein, the term \"Base Real Property Taxes\" shall be the\namount of Real Property Taxes, which are assessed against the Property Taxes for\nany real estate tax year shall be included in the calculation of Real Property\nTaxes for such calendar year based upon the number of which such calendar year\nand tax year have in common.\n\n      10.3 Additional Improvements. Common Area Operating Expenses shall not\ninclude Real Property Taxes specified in the tax assessor's records and work\nsheets as being caused by additional improvements placed upon the Industrial\nCenter by other lessees or by Lessor for the exclusive enjoyment of such other\nlessees. Notwithstanding Paragraph 10.1 hereof, Lessee shall, however, pay to\nLessor at the time Common Area Operating Expenses are payable under Paragraph\n4.2, the entirety of any increase in Real Property Taxes if assessed solely by\nreason of Alterations, Trade Fixtures or Utility Installations placed upon the\nPremises by Lessee or at Lessee's request.\n\n      10.4 Joint Assessment. If the Building is not separately assessed, Real\nProperty Taxes allocated to the Building shall be an equitable proportion of the\nReal Property Taxes for all of the land and improvements included within the tax\nparcel assessed, such proportion to be determined by Lessor from the respective\nvaluations assigned in the assessor's work sheets or such other information as\nmay be reasonably available. Lessor's reasonable determination thereof, in good\nfaith, shall be conclusive.\n\n      10.5 Lessee's Property Taxes. Lessee shall pay prior to delinquency all\ntaxes assessed against and levied upon Lessee-Owned Alterations and Utility\nInstallations Trade Fixtures, furnishings, equipment and all personal property\nof Lessee contained in the Premises or stored within the Industrial Center. When\npossible, Lessee shall cause its Lessee-Owned Alterations and Utility\nInstallations, Trade Fixtures, furnishings, equipment and all other personal\nproperty to be assessed and billed separately from the real property of Lessor.\nIf any of Lessee's said property shall be assessed with Lessor's real property,\nLessee shall pay Lessor the taxes attributable to Lessee's property within ten\n(10) days after receipt of a written statement setting forth the taxes\napplicable to Lessee's property.\n\n11. Utilities. Lessee shall pay directly for all utilities and services supplied\nto the Premises, including but not limited to electricity, telephone, security,\ngas and cleaning of the Premises, together with any taxes thereon. If any such\nutilities or services are not separately metered to the Premises or separately\nbilled to the Premises, Lessee shall pay to Lessor a reasonable proportion to be\ndetermined by Lessor of all such charges jointly metered or billed with other\npremises in the Building, in the manner and within the time periods set forth in\nParagraph 4.2(d).\n\n12. Assignment and Subletting.\n\n      12.1 Lessor's Consent Required.\n\n            (a) Lessee shall not voluntarily or by operation of law assign,\ntransfer, mortgage or otherwise transfer or encumber (collectively, \"assign\") or\nsublet all or any part of Lessee's interest in this Lease or in the Premises\nwithout Lessor's prior written consent given under and subject to the terms of\nParagraph 36.\n\n            (b) A change in the control of Lessee shall constitute an assignment\nrequiring Lessor's consent. The transfer, on a cumulative basis, of twenty-five\npercent (25%) or more of the voting control of Lessee shall constitute a change\nin control for this purpose.\n\n            (c) The involvement of Lessee or its assets in any transaction, or\nseries of transactions (by way of merger, sale, acquisition, financing\nrefinancing. transfer, leveraged buy-out or otherwise), whether or not a formal\nassignment or hypothecation of this Lease or Lessee's assets occurs, which\nresults or will result in a reduction of the Net Worth of Lessee, as hereinafter\ndefined, by an amount equal to or greater than twenty-five percent (25%) of such\nNet Worth of Lessee as it was represented to Lessor at the time of full\nexecution and delivery of this Lease or at the time of the most recent\nassignment to which Lessor has consented, or as it exists immediately prior to\nsaid transaction or transactions constituting such reduction, at whichever time\nsaid Net Worth of Lessee was or is greater, shall be considered an assignment of\nthis Lease by Lessee to which Lessor may reasonably withhold its consent. \"Net\nWorth of Lessee\" for purposes of this Lease shall be the net worth of Lessee\n(excluding any Guarantors) established under generally accepted accounting\nprinciples consistently applied.\n\n            (d) An assignment or subletting of Lessee's interest in this Lease\nwithout Lessor's specific prior written consent shall, at Lessors option, be a\n[ILLEGIBLE] curable after notice per Paragraph 13.1, or a non-curable Breach\nwithout the necessity of any notice and grace period. If Lessor elects to treat\nsuch represented to assignment or subletting as a non-curable Breach, Lessor\nshall have the right to either: (i) terminate this Lease, or (ii) upon thirty\n(30) days' written notice (\"Lessors Notice\"), increase the monthly Base Rent for\nthe Premises to the greater of the then fair market rental value of the\nPremises, as reasonably determined by Lessor, or one hundred ten percent (110%)\nof the Base Rent then in effect. Pending determination of the new fair market\nrental value, if disputed by Lessee, Lessee shall pay the amount set forth in\nLessor's Notice, with any overpayment credited against the next installment(s)\nof Base Rent coming due, and any underpayment for the period retroactively to\nthe effective date of the adjustment being due and payable immediately upon the\ndetermination thereof. Further, in the event of such Breach and rental\nadjustment, (i) the purchase price of any option to purchase the Premises held\nby Lease shall be subject to similar adjustment to the then fair market value as\nreasonably determined by Lessor (without the Lease being considered an\nencumbrance or any deduction for depreciation or obsolescence, and considering\nthe Premises at its highest and best use and in good condition) or one hundred\nten percent (110%) of the price previously in effect, (ii) any index-oriented\nrental or price adjustment formulas contained in this Lease shall be adjusted to\nrequire that the base index be determined with reference to the index applicable\nto the time of such adjustment, and (iii) any fixed rental adjustments scheduled\nduring the remainder of the Lease term shall be increased in the same ratio as\nthe new rental bears to the Base Rent in effect immediately prior to the\nadjustment specified in Lessor's Notice.\n\n            (e) Lessee's remedy for any breach of this Paragraph 12.1 by Lessor\nshall be limited to compensatory damages and\/or injunctive relief.\n\n      12.2 Terms and Conditions Applicable to Assignment and Subletting.\n\n            (a) Regardless of Lessor's consent, any assignment or subletting\nshall not (i) be effective without the express written assumption by such\nassignee or sublessee of the obligations of Lessee under this Lease, (ii)\nrelease Lessee of any obligations hereunder, nor (iii) alter the primary\nliability of Lessee for the payment of Base Rent and other sums due Lessor\nhereunder or for the performance of any other obligations to be performed by\nLessee under this Lease.\n\n            (b) Lessor may accept any rent or performance of Lessee's\nobligations from any person other than Lessee pending approval or disapproval of\nan assignment. Neither a delay in the approval or disapproval of such assignment\nnor the acceptance of any rent for performance shall constitute a waiver or\nestoppel of Lessor's right to exercise its remedies for the Default or Breach by\nLessee of any of the terms, covenants or conditions of this Lease.\n\n            (c) The consent of Lessor to any assignment or subletting shall not\nconstitute a consent to any subsequent assignment or subletting by Lessee or to\nany subsequent or successive assignment or subletting by the assignee or\nsublessee. However, Lessor may consent to subsequent sublettings and assignments\nof the sublease or any amendments or modifications thereto without notifying\nLessee or anyone else liable under this Lease or the sublease and without\nobtaining their consent, and such action shall not relieve such persons from\nliability under this Lease or the sublease.\n\n\n                                      -6-\n\n \n            (d) In the event of any Default or Breach of Lessee's obligation\nunder this Lease, Lessor may proceed directly against Lessee, any Guarantors or\nanyone else responsible for the performance of the Lessee's obligations under\nthis Lease, including any sublessee, without first exhausting Lessor's remedies\nagainst any other person or entity responsible therefor to Lessor, or any\nsecurity held by Lessor.\n\n            (e) Each request for consent to an assignment or subletting shall be\nin writing, accompanied by information relevant to Lessor's determination as to\nthe financial and operational responsibility and appropriateness of the proposed\nassignee or sublessee, including but not limited to the intended use and\/or\nrequired modification of the Premises, if any, together with a non-refundable\ndeposit of $1,000 or ten percent (10%) of the monthly Base Rent applicable to\nthe portion of the Premises which is subject of the proposed assignment or\nsublease, whichever is greater, as reasonable consideration for Lessor's\nconsidering and processing the request for consent. Lessee agrees to provide\nLessor with such other or additional information and\/or documentation as may be\nreasonably requested by Lessor.\n\n            (f) Any assignee of, or sublessee under, this Lease shall, by reason\nof accepting such assignment or entering into such sublease, be deemed, for the\nbenefit of Lessor, to have assumed and agreed to conform and comply with each\nand every term, covenant, condition and obligation herein to be observed or\nperformed by Lessee during the term of said assignment or sublease, other than\nsuch obligations as are contrary to or inconsistent with provisions of an\nassignment or sublease to which Lessor has specifically consented in writing.\n\n      12.3 Additional Terms and Conditions Applicable to Subletting. The\nfollowing terms and conditions shall apply to any subletting by Lessee of all or\nany part of the Premises and shall be deemed included in all subleases under\nthis Lease whether or not expressly incorporated therein:\n\n            (a) Lessee hereby assigns and transfers to Lessor all of Lessee's\ninterest in all rentals and income arising from any sublease of all or a portion\nof the Premises heretofore or hereafter made by Lessee, and Lessor may collect\nsuch rent and income and apply same toward Lessee's obligations under this\nLease; provided, however, that until a Breach (as defined in Paragraph 13.1)\nshall occur in the performance of Lessee's obligations under this Lease, Lessee\nmay, except as otherwise provided in this Lease, receive, collect and enjoy the\nrents accruing under such sublease. Lessor shall not, by reason of the foregoing\nprovision or any other assignment of such sublease to Lessor, nor by reason of\nthe collection of the rents from a sublessee, be deemed liable to the sublessee\nfor any failure of Lessee to perform and comply with any of Lessee's obligations\nto such sublessee under such Sublease. Lessee hereby irrevocably authorizes and\ndirects any such sublessee, upon receipt of a written notice from Lessor stating\nthat a Breach exists in the performance of Lessee's obligations under this\nLease, to pay to Lessor the rents and other charges due and to become due under\nthe sublease. Sublessee shall rely upon any such statement and request from\nLessor and shall pay such rents and other charges to Lessor without any\nobligation or right to inquire as to whether such Breach exists and\nnotwithstanding any notice from or claim from Lessee to the contrary. Lessee\nshall have no right or claim against such sublessee, or, until the Breach has\nbeen cured, against Lessor, for any such rents and other charges so paid by said\nsublessee to Lessor.\n\n            (b) In the event of a Breach by Lessee in the performance of its\nobligations under this Lease, Lessor, at its option and without any obligation\nto do so, may require any sublessee to attorn to Lessor, in which event Lessor\nshall undertake the obligations of the sublessor under such sublease from the\ntime of the exercise of said option to the expiration of such sublease;\nprovided, however, Lessor shall not be liable for any prepaid rents or security\ndeposit paid by such sublessee to such sublessor or for any other prior defaults\nor breaches of such sublessor under such sublease.\n\n            (c) Any matter or thing requiring the consent of the sublessor under\na sublease shall also require the consent of Lessor herein.\n\n            (d) No sublessee under a sublease approved by Lessor shall further\nassign or sublet all or any part of the Premises without Lessor's prior written\nconsent.\n\n            (e) Lessor shall deliver a copy of any notice of Default or Breach\nby Lessee to the sublessee, who shall have the right to cure the Default of\nLessee within the grace period, if any, specified in such notice. The sublessee\nshall have a right of reimbursement and offset from and against Lessee for any\nsuch Defaults cured by the sublessee.\n\n13. Default; Breach; Remedies.\n\n      13.1 Default; Breach. Lessor and Lessee agree that if an attorney is\nconsulted by Lessor in connection with a Lessee Default or Breach (as\nhereinafter defined), $350.00 is a reasonable minimum sum per such occurrence\nfor legal services and costs in the preparation and service of a notice of\nDefault, and that Lessor may include the cost of such services and costs in said\nnotice as rent due and payable to cure said default. A \"Default by Lessee is\ndefined as a failure by Lessee to observe, comply with or perform any of the\nterms, covenants, conditions or rules applicable to Lessee under this Lease. A\n\"Breach\" by Lessee is defined as the occurrence of any one or more of the\nfollowing Defaults, and, where a grace period for cure after notice is specified\nherein, the failure by Lessee to cure such Default prior to the expiration of\nthe applicable grace period, and shall entitle Lessor to pursue the remedies set\nforth in Paragraphs 13.2 and\/or 13.3:\n\n            (a) The vacating of the Premises without the intention to reoccupy\nsame, or the abandonment of the Premises.\n\n            (b) Except as expressly otherwise provided in this Lease, the\nfailure by Lessee to make any payment of Base Rent, Lessee's Share of Common\nArea Operating Expenses, or any other monetary payment required to be made by\nLessee hereunder as and when due, the failure by Lessee to provide Lessor with\nreasonable evidence of insurance or surety bond required under this Lease, or\nthe failure of Lessee to fulfill any obligation under this Lease which endangers\nor threatens life or property, where such failure continues for a period of\nthree (3) days following written notice thereof by or on behalf of Lessor to\nLessee.\n\n            (c) Except as expressly otherwise provided in this Lease, the\nfailure by Lessee to provide Lessor with reasonable written evidence (i) duly\nexecuted original form, if applicable) of (i) compliance with Applicable\nRequirements per Paragraph 6.3, (ii) the inspection, maintenance and service\ncontracts required under Paragraph 7.1(b), (iii) the rescission of an\nunauthorized assignment or subletting per Paragraph 12.1, (iv) a Tenancy\nStatement per Paragraphs 18 or 37, (v) the subordination or non-subordination of\nthis Lease per Paragraph 30, (vi) the guaranty of the performance of Lessee's\nobligations under this Lease if required under Paragraphs 1.11 and 37, (vii) the\nexecution of any document requested under Paragraph 42 (easements), or (viii)\nany other documentation or information which Lessor may reasonably require of\nLessee under the terms of this lease, where any such failure continues for a\nperiod of ten (10) days following written notice by or on behalf of Lessor to\nLessee.\n\n            (d) A Default by Lessee as to the terms, covenants, conditions or\nprovisions of this Lease, or of the rules adopted under Paragraph 40 hereof that\nare to be observed, complied with or performed by Lessee, other than those\ndescribed in Subparagraphs 13.1(a), (b) or (c), above, where such Default\ncontinues for a period of thirty (30) days after written notice thereof by or on\nbehalf of Lessor to Lessee; provided, however, that if the nature of Lessees\nDefault is such that more than thirty (30) days are reasonably required for its\ncure, then it shall not be deemed to be a Breach of this Lease by Lessee if\nLessee commences such cure within said thirty (30) day period and thereafter\ndiligently prosecutes such cure to completion.\n\n            (e) The occurrence of any of the following events: (i) the making by\nLessee of any general arrangement or assignment for the benefit of creditors;\n(ii) Lessees becoming a \"debtor\" as defined in 11 U.S. Code Section 101 or any\nsuccessor statute thereto (unless, in the case of a petition filed against\nLessee, the same is dismissed within sixty (60) days); (iii) the appointment of\na trustee or receiver to take possession of substantially all of Lessees assets\nlocated at the Premises or of Lessee's interest in this Lease, where possession\nis not restored to Lessee within thirty (30) days: or (iv) the attachment,\nexecution or other judicial seizure of substantially all of Lessee's assets\nlocated at the Premises or of Lessee's interest in this Lease, where such\nseizure is not discharged within thirty (30) days; provided, however, in the\nevent that any provision of this Subparagraph 13.1(e) is contrary to any\napplicable law, such provision shall be of no force or effect, and shall not\naffect the validity of the remaining provisions.\n\n            (f) The discovery by Lessor that any financial statement of Lessee\nor of any Guarantor, given to Lessor by Lessee or any Guarantor, was materially\n\n            (g) If the performance of Lessee's oblIgations under this Lease is\nguaranteed: (i) the death of a Guarantor, (ii) the termination of a Guarantor's\nliability with respect to this Lease other than in accordance with the terms of\nsuch guaranty, (iii) a Guarantor's becoming insolvent or the subject of a\nbankruptcy filing, (iv) a Guarantor's refusal to honor the guaranty, or (v) a\nGuarantor's breach of its guaranty obligation on an anticipatory breach basis,\nand Lessee's failure, within sixty (60) days following written notice by or on\nbehalf of Lessor to Lessee of any such event, to provide Lessor with written\nalternative assurances of security, which, when coupled with the then existing\nresources of Lessee, equals or exceeds the combined financial resources of\nLessee and the Guarantors that existed at the time of execution of this Lease.\n\n      13.2 Remedies. If Lessee fails to perform any affirmative duty or\nobligation of Lessee under this Lease, within ten (10) days after written notice\nto Lessee (or in case of an emergency, without written notice), Lessor may at\nits option (but without obligation to do so), perform such duty or obligation on\nLessee's behalf, including but not limited to the obtaining of reasonably\nrequired bonds, insurance policies, or governmental licenses, permits or\napprovals. The costs and expenses of any such performance by Lessor shall be due\nand payable by Lessee to Lessor upon invoice therefor. If any check given to\nLessor by Lessee shall not be honored by the bank upon which it is drawn, Lessor\nat its own option, may require all future payments to be made under this Lease\nby Lessee to be made only by cashier's check. In the event of a Breach of this\nLease by Lessee (as defined in Paragraph 13.1), with or without further notice\nor demand, and without limiting Lessor in the exercise of any right or remedy\nwhich Lessor may have by reason of such Breach, Lessor may:\n\n            (a) Terminate Lessee's right to possession of the Premises by any\nlawful means, in which case this Lease and the term hereof shall terminate and\nLessee shall immediately surrender possession of the Premises to Lessor. In such\nevent Lessor shall be entitled to recover from Lessee: (i) the worth at the time\nof the award of the unpaid rent which had been earned at the time of\ntermination; (ii) the worth at the time of award of the amount by which the\nunpaid rent which would have been earned after termination until the time of\naward exceeds the amount of such rental loss that the Lessee proves could have\nbeen reasonably avoided; (iii) the worth at the time of award of the amount by\nwhich the unpaid rent for the balance of the term after the time of award\nexceeds the amount of such rental loss that the Lessee proves could be\nreasonably avoided; and (iv) any other amount necessary to compensate Lessor for\nall the detriment proximately caused by the Lessee's failure to perform its\nobligations under this Lease or which in the ordinary course of things would be\nlikely to result therefrom, including but not limited to the cost of recovering\npossession of the Premises, expenses of reletting, including necessary\nrenovation and alteration of the Premises, reasonable attorneys' fees, and that\nportion of any leasing commission paid by Lessor in connection with this Lease\napplicable to the unexpired term of this Lease. The worth at the time of award\nof the amount referred to in provision (iii) of the immediately preceding\nsentence shall be computed by discounting such amount at the discount rate of\nthe Federal Reserve Bank of San Francisco or the Federal Reserve Bank District\nin which the Premises are located at the time of award plus one percent (1%).\nEfforts by Lessor to mitigate damages caused by Lessee's Default or Breach of\nthis Lease shall not waive Lessor's right to recover damages under this\nParagraph 13.2. If termination of this Lease is obtained\n\n\n                                      -7-\n\n \nthrough the provisional remedy of unlawful detainer, Lessor shall have the right\nto recover in such proceeding the unpaid rent and damages as are recoverable\ntherein, or Lessor may reserve the right to recover all or any part thereof in a\nseparate suit for such rent and\/or damages. If a notice and grace period\nrequired under Subparagraph 13.1(b), (c) or (d) was not previously given, a\nnotice to pay rent or quit, or to perform or quit, as the case may be, given to\nLessee under any statute authorizing the forfeiture of leases for unlawful\ndetainer shall also constitute the applicable notice for grace period purposes\nrequired by Subparagraph 13.1(b), (c) or (d). In such case, the applicable grace\nperiod under the unlawful detainer statute shall run concurrently after the one\nsuch statutory notice, and the failure of Lessee to cure the Default within the\ngreater of the two (2) such grace periods shall constitute both an unlawful\ndetainer and a Breach of this Lease entitling Lessor to the remedies provided\nfor in this Lease and\/or by said statute.\n\n            (b) Continue the Lease and Lessee's right to possession in effect\n(in California under California Civil Code Section 1951.4) after Lessee's Breach\nand recover the rent as it becomes due, provided Lessee has the right to sublet\nor assign, subject only to reasonable limitations. Lessor and Lessee agree that\nthe limitations on assignment and subletting this Lease are reasonable. Acts of\nmaintenance or preservation, efforts to relet the Premises, or the appointment\nof a receiver to protect the Lessor's interest under this Lease, shall not\nconstitute a termination of the Lessee's right to possession.\n\n            (c) Pursue any other remedy now or hereafter available to Lessor\nunder the laws or judicial decisions of the state wherein the Premises are\nlocated.\n\n            (d) The expiration or termination of this Lease and\/or the\ntermination of Lessee's right to possession shall not relieve Lessee from\nliability under any indemnity provisions of this Lease as to matters occurring\nor accruing during the term hereof or by reason of Lessee's occupancy of the\nPremises.\n\n      13.3 Inducement Recapture in Event of Breach. Any agreement by Lessor for\nfree or abated rent or other charges applicable to the Premises, or for the\ngiving or paying by Lessor to or for Lessee of any cash or other bonus,\ninducement or consideration for Lessee's entering into this Lease, all of which\nconcessions are hereinafter referred to as \"Inducement Provisions\" shall be\ndeemed conditioned upon Lessee's full and faithful performance of all of the\nterms, covenants and conditions of this Lease to be performed or observed by\nLessee during the term hereof as the same may be extended. Upon the occurrence\nof a Breach (as defined in Paragraph 13.1) of this Lease by Lessee, any such\nInducement Provision shall automatically be deemed deleted from this Lease and\nof no further force or effect, and any rent, other charge, bonus, inducement or\nconsideration theretofore abated, given or paid by Lessor under such an\nInducement Provision shall be immediately due and payable by Lessee to Lessor,\nand recoverable by Lessor, as additional rent due under this Lease,\nnotwithstanding any subsequent cure of said Breach by Lessee. The acceptance by\nLessor of rent or the cure of the Breach which initiated the operation of this\nParagraph 13.3 shall not be deemed a waiver by Lessor of the provisions of this\nParagraph 13.3 unless specifically so stated in writing by Lessor at the time of\nsuch acceptance.\n\n      13.4 Late Charges. Lessee hereby acknowledges that late payment by Lessee\nto Lessor of rent and other sums due hereunder will cause Lessor to incur costs\nnot contemplated by this Lease, the exact amount of which will be extremely\ndifficult to ascertain. Such costs include, but are not limited to, processing\nand accounting charges, and late charges which may be imposed upon Lessor by the\nterms of any ground lease, mortgage or deed of trust covering the Premises.\nAccordingly, if any installment of rent or other sum due from Lessee shall not\nbe received by Lessor or Lessor's designee within ten (10) days after such\namount shall be due, then, without any requirement for notice to Lessee, Lessee\nshall pay to Lessor a late charge equal to six percent (6%) of such overdue\namount. The parties hereby agree that such late charge represents a fair and\nreasonable estimate of the costs Lessor will incur by reason of late payment by\nLessee. Acceptance of such late charge by Lessor shall in no event constitute a\nwaiver of Lessee's Default or Breach with respect to such overdue amount, nor\nprevent Lessor from exercising any of the other rights and remedies granted\nhereunder. In the event that a late charge is payable hereunder, whether or not\ncollected, for three (3) consecutive installments of Base Rent, then\nnotwithstanding Paragraph 4.1 or any other provision of this Lease to the\ncontrary, Base Rent shall, at Lessor's option, become due and payable quarterly\nin advance.\n\n      13.5 Breach by Lessor. Lessor shall not be deemed in breach of this Lease\nunless Lessor fails within a reasonable time to perform an obligation required\nto be performed by Lessor. For purposes of this Paragraph 13.5, a reasonable\ntime shall in no event be less than thirty (30) days after receipt by Lessor,\nand by any Lender(s) whose name and address shall have been furnished to Lessee\nin writing for such purpose, of written notice specifying wherein such\nobligation of Lessor has not been performed; provided, however, that if the\nnature of Lessor's obligation is such that more than thirty (30) days after such\nnotice are reasonably required for its performance, then Lessor shall not be in\nbreach of this Lease if performance is commenced within such thirty (30) day\nperiod and thereafter diligently pursued to completion.\n\n      14. Condemnation. If the Premises or any portion thereof are taken under\nthe power of eminent domain or sold under the threat of the exercise of said\npower (all of which are herein called \"condemnation\"), this Lease shall\nterminate as to the part so taken as of the date the condemning authority takes\ntitle or possession, whichever first occurs. If more than ten percent (10%) of\nthe floor area of the Premises, or more than twenty-five percent (25%) of the\nportion of the Common Areas designated for Lessee's parking, is taken by\ncondemnation, Lessee may, at Lessee's option, to be exercised in writing within\nten (10) days after Lessor shall have given Lessee written notice of such taking\n(or in the absence of such notice, within ten (10) days after the condemning\nauthority shall have taken possession) terminate this Lease as of the date the\ncondemning authority takes such possession. If Lessee does not terminated this\nLease in accordance with the foregoing, this Lease shall remain in full force\nand effect as to the portion of the Premises remaining, except that the Base\nRent shall be reduced in the same proportion as the rentable floor area of the\nPremises taken bears to the total rentable floor area of the Premises. No\nreduction of Base Rent shall occur if the condemnation does not apply to any\nportion of the Premises. Any award for the taking of all or any part of the\nPremises under the power of eminent domain or any payment made under threat of\nthe exercise of such power shall be the property of Lessor, whether such award\nshall be made as compensation for diminution of value of the leasehold or for\nthe taking of the fee, or as severance damages; provided, however, that Lessee\nshall be entitled to any compensation, separately awarded to Lessee for Lessee's\nrelocation expenses and\/or loss of Lessee's Trade Fixtures. In the event that\nthis Lease is not terminated by reason of such condemnation, Lessor shall to the\nextent of its net severance damages received, over and above Lessee's Share of\nthe legal and other expenses incurred by Lessor in the condemnation matter,\nrepair any damage caused by such condemnation authority. Lessee shall be\nresponsible for the payment of any amount in excess of such net severance\ndamages required to complete such repair.\n\n15. Brokers' Fees.\n\n      15.1 Procuring Cause. The Broker(s) named in Paragraph 1.10 is\/are the\nprocuring cause of this Lease.\n\n      15.2 Additional Terms. Unless Lessor and Broker(s) have otherwise agreed\nin writing, Lessor agrees that: (a) if Lessee exercises any Option (as defined\nin paragraph 39.1) granted under this Lease or any Option subsequently granted,\nor (b) if Lessee acquires any rights to the Premises or other premises in which\nLessor has an interest, or (c) if Lessee remains in possession of the Premises\nwith the consent of Lessor after the expiration of the term of this Lease after\nhaving failed to exercise an Option, or (d) if said Brokers are the procuring\ncause of any other lease or sale entered into between the Parties pertaining to\nthe Premises and\/or any adjacent property in which Lessor has an interest, or\n(e) if Base Rent is increased, whether by agreement or operation of an\nescalation clause herein, then as to any of said transactions, Lessor shall pay\nsaid Broker(s) a fee in accordance with the schedule of said Broker(s) in effect\nat the time of the execution of this Lease.\n\n      15.3 Assumption of Obligations. Any buyer or transferee of Lessor's\ninterest in this Lease, whether such transfer is by agreement or by operation of\nlaw, shall be deemed to have assumed Lessor's obligation under this Paragraph\n15. Each Broker shall be an intended third party beneficiary of the provisions\nof Paragraph 1.10 and of this Paragraph 15 to the extent of its interest in any\ncommission arising from this Lease and may enforce that right directly against\nLessor and its successors.\n\n      15.4 Representations and Warranties. Lessee and Lessor each represent and\nwarrant to the other that it has had no dealings with any person, firm, broker\nor finder other than as named in Paragraph 1.10(a) in connection with the\nnegotiation of this Lease and\/or the consummation of the transaction\ncontemplated hereby, and that no broker or other person, firm or entity other\nthan said named Broker(s) is entitled to any commission or finder's fee in\nconnection with said transaction. Lessee and Lessor do each hereby agree to\nindemnify, protect, defend and hold the other harmless from and against\nliability for compensation or charges which may be claimed by any such unnamed\nbroker, finder or other similar party by reason of any dealings or actions of\nthe indemnifying Party, including any costs, expenses, and\/or attorney's fees\nreasonably incurred with respect thereto.\n\n16. Tenancy and Financial Statements.\n\n      16.1 Tenancy Statement. Each Party (as \"Responding Party\") shall within\nten (10) days after written notice from the other Party (the \"Requesting Party\")\nexecute, acknowledge and deliver to the Requesting Party a statement in writing\nin a form similar to the then most current \"Tenancy Statement\" form published by\nthe American Industrial Real Estate Association, plus such additional\ninformation, confirmation and\/or statements as may be reasonably requested by\nthe Requesting Party.\n\n      16.2 Financial Statement. If Lessor desires to finance, refinance, or sell\nthe Premises or the Building, or any part thereof, Lessee and all Guarantors\nshall deliver to any potential lender or purchaser designated by Lessor such\npublic financial statements of Lessee and such Guarantors as may be reasonably\nrequired by such lender or purchaser, including but not limited to Lessee's\nfinancial statements for the past three (3) years. All such financial statements\nshall be received by Lessor and such lender or purchaser in confidence and shall\nbe used only for the purposes herein set forth.\n\n17. Lessor's Liability. The term \"Lessor\" as used herein shall mean the owner or\nowners at the time in question of the fee title to the Premises. In the event of\na transfer of Lessor's title or interest in the Premises or in this Lease,\nLessor shall deliver to the transferee or assignee (in cash or by credit) any\nunused Security Deposit held by Lessor at the time of such transfer or\nassignment. Except as provided in Paragraph 15.3, upon such transfer or\nassignment and delivery of the Security Deposit, as aforesaid, the prior Lessor\nshall be relieved of all liability with respect to the obligations and\/or\ncovenants under this Lease thereafter to be performed by the Lessor. Subject to\nthe foregoing, the obligations and\/or covenants in this Lease to be performed by\nthe Lessor shall be binding only upon the Lessor as hereinabove defined.\n\n18. Severability. The invalidity of any provision of this Lease, as determined\nby a court of competent jurisdiction, shall in no way affect the validity of any\nother provision hereof.\n\n19. Interest on Past-Due Obligations. Any monetary payment due Lessor hereunder,\nother than late charges, not received by Lessor within ten (10) days following\nthe date on which it was due, shall bear interest from the date due at the prime\nrate charged by the largest state chartered bank in the state in which the\nPremises are located plus four percent (4%) per annum, but not exceeding the\nmaximum rate allowed by law, in addition to the potential late charge provided\nfor in Paragraph 13.4.\n\n20. Time of Essence. Time is of the essence with respect to the performance of\nall obligations to be performed or observed by the Parties under this Lease.\n\n21. Rent Defined. All monetary obligations of Lessee to Lessor under the terms\nof this Lease are deemed to be rent.\n\n22. No Prior or Other Agreements; Broker Disclaimer. This Lease contains all\nagreements between the Parties with respect to any matter mentioned herein, and\nno other prior or contemporaneous agreement or understanding shall be effective.\nLessor and Lessee each represents and warrants to the Brokers that it has made,\nand is relying solely upon, its own investigation as to the nature, quality,\ncharacter and financial responsibility of the other Party to this Lease and as\nto the nature, quality and character of the Premises. Brokers have no\nresponsibility with respect thereto or with respect to any default or breach\nhereof by either Party. Each Broker shall be an intended third party beneficiary\nof the provisions of this Paragraph 22.\n\n\n                                      -8-\n\n \n23. Notices.\n\n      23.1 Notice Requirements. All notices required or permitted by this Lease\nshall be in writing and may be delivered in person (by hand or by messenger or\ncourier service) or may be sent by regular, certified or registered mail or U.S.\nPostal Service Express Mail, with postage prepaid, or by facsimile transmission\nduring normal business hours, and shall be deemed sufficiently given if served\nin a manner specified in this Paragraph 23. The addresses noted adjacent to a\nParty's signature on this Lease shall be that Party's address for delivery or\nmailing of notice purposes. Either Party may by written notice to the other\nspecify a different address for notice purposes, except that upon Lessee's\ntaking possession of the Premises, the Premises shall constitute Lessee's\naddress for the purpose of mailing or delivering notices to Lessee. A copy of\nall notices required or permitted to be given to Lessor hereunder shall be\nconcurrently transmitted to such party or parties at such addresses as Lessor\nmay from time to time hereafter designate by written notice to Lessee.\n\n      23.2 Date of Notice. Any notice sent by registered or certified mail,\nreturn receipt requested, shall be deemed given on the date of delivery shown on\nthe receipt card, or if no delivery date is shown, the postmark thereon. If sent\nby regular mail, the notice shall be deemed given forty-eight (48) hours after\nthe same is addressed as required herein and mailed with postage prepaid.\nNotices delivered by United States Express Mail or overnight courier that\nguarantees next day delivery shall be deemed given twenty-four (24) hours after\ndelivery of the same to the United States Postal Service or courier. If any\nnotice is transmitted by facsimile transmission or similar means, the same shall\nbe deemed served or delivered upon telephone or facsimile confirmation of\nreceipt of the transmission thereof, provided a copy is also delivered via\ndelivery or mail. If notice is received on a Saturday or a Sunday or a legal\nholiday, it shall be deemed received on the next business day.\n\n24. Waivers. No waiver by Lessor of the Default or Breach of any term, covenant\nor condition hereof by Lessee shall be deemed a waiver of any other term,\ncovenant or condition hereof, or of any subsequent Default or Breach by Lessee\nof the same or any other term, covenant or condition hereof. Lessor's consent\nto, or approval of, any such act shall not be deemed to render unnecessary the\nobtaining of such Lessors consent to, or approval of, any subsequent or similar\nact by Lessee, or be construed as the basis of an estoppel to enforce the\nprovision or provisions of this Lease requiring such consent. Regardless of\nLessor's knowledge of a Default or Breach at the time of accepting rent, the\nacceptance of rent by Lessor shall not be a waiver of any Default or Breach by\nLessee of any provision hereof. Any payment given Lessor by Lessee may be\naccepted by the Lessor on account of moneys or damages due Lessor,\nnotwithstanding any qualifying statements or conditions made by Lessee in\nconnection therewith, which such statements and\/or conditions shall be of no\nforce or effect whatsoever unless specifically agreed to in writing by Lessor at\nor before the time of deposit of such payment.\n\n25. Recording. Either Lessor or Lessee shall, upon request of the other,\nexecute, acknowledge and deliver to the other a short form memorandum of this\nLease for recording purposes. The party requesting recordation shall be\nresponsible for payment of any fees or taxes applicable thereto.\n\n26. No Right To Holdover. Lessee has no right to retain possession of the\nPremises or any part thereof beyond the expiration or earlier termination of\nthis Lease. In the event that Lessee holds over in violation of this Paragraph\n26 then the Base Rent payable from and after the time of the expiration or\nearlier termination of this Lease shall be increased to two hundred percent\n(200%) of the Base Rent applicable during the month immediately preceding such\nexpiration or earlier termination. Nothing contained herein shall be construed\nas a consent by Lessor to any holding over by Lessee.\n\n27. Cumulative Remedies. No remedy or election hereunder shall be deemed\nexclusive but shall, wherever possible, be cumulative with all other remedies at\nlaw or in equity.\n\n28. Covenants and Conditions. All provisions of this Lease to be observed or\nperformed by Lessee are both covenants and conditions.\n\n29. Binding Effect; Choice of Law. This Lease shall be binding upon the Parties,\ntheir personal representatives, successors and assigns and be governed by the\nlaws of the State in which the Premises are located. Any litigation between the\nParties hereto concerning this Lease shall be initiated in the county in which\nthe Premises are located.\n\n30. Subordination; Attornment; Non-Disturbance.\n\n      30.1 Subordination. This Lease and any Option granted hereby shall be\nsubject and subordinate to any ground lease, mortgage, deed of trust, or other\nhypothecation or security device (collectively, \"Security Device\"), now or\nhereafter placed by Lessor upon the real property of which the Premises are a\npart, to any and all advances made on the security thereof, and to all renewals,\nmodifications, consolidations, replacements and extensions thereof. Lessee\nagrees that the Lenders holding any such Security Device shall have no duty,\nliability or obligation to perform any of the obligations of Lessor under this\nLease, but that in the event or Lessor's default with respect to any such\nobligation, Lessee will give any Lender whose name and address have been\nfurnished Lessee in writing for such purpose notice of Lessor's default pursuant\nto Paragraph 13.5. If any Lender shall elect to have this Lease and\/or any\nOption granted hereby superior to the lien of its Security Device and shall give\nwritten notice thereof to Lessee, this Lease and such Options shall be deemed\nprior to such Security Device, notwithstanding the relative dates of the\ndocumentation or recordation thereof.\n\n      30.2 Attornment. Subject to the non-disturbance provisions of Paragraph\n30.3, Lessee agrees to attorn to a Lender or any other party who acquires\nownership of the Premises by reason of a foreclosure of a Security Device, and\nthat in the event of such foreclosure, such new owner shall not: (i) be liable\nfor any act or omission or any prior lessor or with respect to events occurring\nprior to acquisition of ownership, (ii) be subject to any offsets or defenses\nwhich Lessee might have against any prior lessor, or (iii) be bound by\nprepayment of more than one month's rent.\n\n      30.3 Non-Disturbance. With respect to Security Devices entered into by\nLessor after the execution of this lease, Lessee's subordination of this Lease\nshall be subject to receiving assurance (a \"non-disturbance agreement\") from the\nLender that Lessee's possession and this Lease, including any options to extend\nthe term hereof, will not be disturbed so long as Lessee is not in Breach hereof\nand attorns to the record owner of the Premises.\n\n      30.4 Self-Executing. The agreements contained in this Paragraph 30 shall\nbe effective without the execution of any further documents; provided, however,\nthat upon written request from Lessor or a Lender in connection with a sale,\nfinancing or refinancing of Premises, Lessee and Lessor shall execute such\nfurther writings as may be reasonably required to separately document any such\nsubordination or non-subordination, attornment and\/or non-disturbance agreement\nas is provided for herein.\n\n31. Attorneys' Fees. If any Party or Broker brings an action or proceeding to\nenforce the terms hereof or declare rights hereunder, the Prevailing Party (as\nhereafter defined) in any such proceeding, action, or appeal thereon, shall be\nentitled to reasonable attorneys' fees. Such fees may be awarded in the same\nsuit or recovered in a separate suit, whether or not such action or proceeding\nis pursued to decision or judgment. The term \"Prevailing Party\" shall include,\nwithout limitation, a Party or Broker who substantially obtains or defeats the\nrelief sought, as the case may be, whether by compromise, settlement, judgment,\nor the abandonment by the other Party or Broker of its claim or defense. The\nattorneys' fee award shall not be computed in accordance with any court fee\nschedule, but shall be such as to fully reimburse all attorneys' fees reasonably\nincurred. Lessor shall be entitled to attorneys' fees, costs and expenses\nincurred in preparation and service of notices of Default and consultations in\nconnection therewith, whether or not a legal action is subsequently commenced in\nconnection with such Default or resulting Breach. Broker(s) shall be intended\nthird party beneficiaries of this Paragraph 31.\n\n32. Lessor's Access; Showing Premises; Repairs. Lessor and Lessor's agents shall\nhave the right to enter the Premises at any time, in the case of an emergency,\nand otherwise at reasonable times for the purpose of showing the same to\nprospective purchasers, lenders, or lessees, and making such alterations,\nrepairs, improvements or additions to the Premises or to the Building, as Lessor\nmay reasonably deem necessary. Lessor may at any time place on or about the\nPremises or Building any ordinary \"For Sale\" signs and Lessor may at any time\nduring the last one hundred eighty (180) days of the term hereof place on or\nabout the Premises any ordinary \"For Lease\" signs. All such activities of Lessor\nshall be without abatement or rent of liability to Lessee.\n\n33. Auctions. Lessee shall not conduct, nor permit to be conducted, either\nvoluntarily or involuntarily, any auction upon the Premises without first having\nobtained Lessor's prior written consent. Notwithstanding anything to the\ncontrary in this Lease, Lessor shall not be obligated to exercise any standard\nof reasonableness in determining whether to grant such consent.\n\n35. Termination; Merger. Unless specifically stated otherwise in writing by\nLessor, the voluntary or other surrender of this Lease by Lessee, the mutual\ntermination or cancellation hereof, or a termination hereof by Lessor for Breach\nby Lessee, shall automatically terminate any sublease or lesser estate in the\nPremises; provided, however, Lessor shall, in the event of any such surrender,\ntermination or cancellation, have the option to continue any one or all of any\nexisting subtenancies. Lessor's failure within ten (10) days following any such\nevent to make a written election to the contrary by written notice to the holder\nof any such lesser interest, shall constitute Lessor's election to have such\nevent constitute the termination of such interest.\n\n36. Consents.\n\n            (a) Except for Paragraph 33 hereof (Auctions) or as otherwise\nprovided herein, wherever in this Lease the consent of a Party is required to an\nact by or for the other Party, such consent shall not be unreasonably withheld\nor delayed. Lessor's actual reasonable costs and expenses (including but not\nlimited to reasonable architects', attorneys', engineers' and other consultants'\nfees) incurred in the consideration of, or response to, a request by Lessee for\nany Lessor consent pertaining to this Lease or the Premises, including but not\nlimited to consents to an assignment a subletting or the presence or use of a\nHazardous Substance, shall be paid by Lessee to Lessor upon receipt of an\ninvoice and supporting documentation therefor. In addition to the deposit\ndescribed in Paragraph 12.2(e), Lessor may, as a condition to considering any\nsuch request by Lessee, require that Lessee deposit with Lessor an amount of\nmoney (in addition to the Security Deposit held under Paragraph 5) reasonably\ncalculated by Lessor to represent the cost Lessor will incur in considering and\nresponding to Lessee's request. Any unused portion of said deposit shall be\nrefunded to Lessee without interest. Lessor's consent to any act, assignment of\nthis Lease or subletting of the Premises by Lessee shall not constitute an\nacknowledgment that no Default or Breach by Lessee of this Lease exists, nor\nshall such consent be deemed a waiver of any then existing Default or Breach,\nexcept as may be otherwise specifically stated in writing by Lessor at the time\nof such consent.\n\n            (b) All conditions to Lessor's consent authorized by this Lease are\nacknowledged by Lessee as being reasonable. The failure to specify herein any\nparticular condition to Lessor's consent shall not preclude the impositions by\nLessor at the time of consent of such further or other conditions as are then\nreasonable with reference to the particular matter for which consent is being\ngiven.\n\n\n\n\n                                      -9-\n\n \n38. Quiet Possession. Upon payment by Lessee of the rent for the Premises and\nthe performance of all of the covenants, conditions and provisions on Lessee's\npart to be observed and performed under this Lease, Lessee shall have quiet\npossession of the Premises for the entire term hereof subject to all of the\nprovisions of this Lease.\n\n39. Options\n\n      39.1 Definition. As used in this Lease, the word \"Option\" has the\nfollowing meaning: (a) the right to extend the term of this Lease or to renew\nthis Lease or to extend or renew any lease that Lessee has on other property of\nLessor; (b) the right of first refusal to lease the Premises or the right of\nfirst offer to lease the Premises or the right of first refusal to lease other\nproperty of Lessor or the right of first offer to lease other property of\nLessor; (c) the right to purchase the Premises, or the right of first refusal to\npurchase the Premises, or the right of first offer to purchase the Premises, or\nthe right to purchase other property of Lessor, or the right of first refusal to\npurchase other property of Lessor, or the right of first offer to purchase other\nproperty of Lessor.\n\n      39.2 Options Personal to Original Lessee. Each Option granted to Lessee in\nthe this Lease is personal to the original Lessee named in paragraph 1.1 hereof,\nand cannot be voluntarily or involuntarily assigned or exercised by any person\nor entity other than said original Lessee while the original Lessee is in full\nand actual possession of the Premises and without the intention of thereafter\nassigning or subletting. The Options, if any, herein granted to Lessee are not\nassignable, either as a part of an assignment of this Lease or separately or\napart therefrom, and no Option may be separated from this Lease in any manner,\nby reservation or otherwise.\n\n      39.3 Multiple Options. In the event that Lessee has any multiple Options\nto extend or renew this Lease, a later option cannot be exercised unless the\nprior Options to extend or renew this Lease have been validly exercised.\n\n      39.4 Effect of Default on Options.\n\n            (a) Lessee shall have no right to exercise an Option,\nnotwithstanding any provision in the grant of Option to the contrary: (i) during\nthe commencing with the giving of any notice of Default under Paragraph 13.1 and\ncontinuing until the noticed Default is cured, or (ii) during the period of time\nany monetary obligation due Lessor from Lessee is unpaid (without regard to\nwhether notice thereof is given Lessee), or (iii) during the time Lessee is in\nBreach of this Lease, or (iv) in the event that Lessor has given to Lessee three\n(3) or more notices of separate Defaults under Paragraph 13.1 during the twelve\n(12) month period immediately preceding the exercise of the Option, whether or\nnot the Defaults are cured.\n\n            (b) The period of time within which an Option may be exercised shall\nnot be extended or enlarged by reason of Lessee's inability to exercise an\nOption because of the provisions of Paragraph 39.4(a).\n\n            (c) All rights of Lessee under the provisions of an Option shall\nterminate and be of no further force or effect, notwithstanding Lessee's due and\ntimely exercise of the Option, if, after such exercise and during the term of\nthis Lease, (i) Lessee fails to pay to Lessor a monetary obligation of Lessee\nfor a period of thirty (30) days after such obligation becomes due (without any\nnecessity of Lessor to give notice thereof to Lessee), or (ii) Lessor gives to\nLessee three (3) or more notices of separate Defaults under Paragraph 13.1\nduring any twelve (12) month period, whether or not the Defaults are cured, or\n(iii) if Lessee commits a Breach of this Lease.\n\n40. Rules and Regulations. Lessee agrees that it will abide by, and keep and\nobserve all reasonable rules and regulations (\"Rules and Regulations\") which\nLessor may make from time to time for the management, safety, care, and\ncleanliness of the grounds, the parking and unloading of vehicles and the\npreservation of good order, as well as for the convenience of other occupants or\ntenants of the Building and the Industrial Center and their invitees.\n\n41. Security Measures. Lessee hereby acknowledges that the rental payable to\nLessor hereunder does not include the cost of guard service or other security\nmeasures, and that Lessor shall have no obligation whatsoever to provide same.\nLessee assumes all responsibility for the protection of the Premises, Lessee,\nits agents and invitees and their property from the acts of third parties.\n\n42. Reservations. Lessor reserves the right, from time to time, to grant,\nwithout the consent or joinder of Lessee, such easements, rights of way, utility\nraceways, and dedications that Lessor deems necessary, and to cause the\nrecordation of parcel maps and restrictions, so long as such easements, rights\nof way, utility raceways, dedications, maps and restrictions do not reasonably\ninterfere with the use of the Premises by Lessee. Lessee agrees to sign any\ndocuments reasonably requested by Lessor to effectuate any such easement rights,\ndedication, map or restrictions.\n\n43. Performance Under Protest. If at any time a dispute shall arise as to any\namount or sum of money to be paid by one Party to the other under the provisions\nhereof, the Party against whom the obligation to pay the money is asserted shall\nhave the right to make payment \"under protest\" and such payment shall not be\nregarded as a voluntary payment and there shall survive the right on the part of\nsaid Party to institute suit for recovery of such sum. If it shall be adjudged\nthat there was no legal obligation on the part of said Party to pay such sum or\nany part thereof, said Party shall be entitled to recover such sum or so much\nthereof as it was not legally required to pay under the provisions of this\nLease.\n\n44. Authority. If either Party hereto is a corporation, trust, or general or\nlimited partnership, each individual executing this Lease on behalf of such\nentity represents and warrants that he or she is duly authorized to execute and\ndeliver this Lease on its behalf. If Lessee is a corporation, trust or\npartnership, Lessee shall, within thirty (30) days after request by Lessor,\ndeliver to Lessor evidence satisfactory to Lessor of such authority.\n\n45. Conflict. Any conflict between the printed provisions of this Lease and the\ntypewritten or handwritten provisions shall be controlled by the typewritten or\nhandwritten provisions.\n\n46. Offer. Preparation of this Lease by either Lessor or Lessee or Lessor's\nagent or Lessee's agent and submission of same to Lessee or Lessor shall not be\ndeemed an offer to lease. This Lease is not intended to be binding until\nexecuted and delivered by all Parties hereto.\n\n47. Amendments. This Lease may be modified only in writing, signed by the\nparties in interest at the time of the modification. The Parties shall amend\nthis Lease from time to time to reflect any adjustments that are made to the\nBase Rent or other rent payable under this Lease. As long as they do not\nmaterially change Lessee's obligations hereunder, Lessee agrees to make such\nreasonable non-monetary modifications to this Lease as may be reasonably\nrequired by an institutional insurance company or pension plan Lender in\nconnection with the obtaining of normal financing or refinancing of the property\nof which the Premises are a part.\n\n48. Multiple Parties. Except as otherwise expressly provided herein, if more\nthan one person or entity is named herein as either Lessor or Lessee, the\nobligations of such multiple parties shall be the joint and several\nresponsibility of all persons or entities named herein as such Lessor or Lessee.\n\n\n                                      -10-\n\n \nLESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND\nPROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR\nINFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE\nTIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE\nAND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE\nPREMISES.\n\n       IF THIS LEASE HAS BEEN FILLED IN, IT HAS BEEN PREPARED FOR YOUR\n       ATTORNEY'S REVIEW AND APPROVAL. FURTHER, EXPERTS SHOULD BE CONSULTED TO\n       EVALUATE THE CONDITION OF THE PROPERTY AS TO THE POSSIBLE PRESENCE OF\n       ASBESTOS, UNDERGROUND STORAGE TANKS OR HAZARDOUS SUBSTANCES. NO\n       REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN INDUSTRIAL REAL\n       ESTATE ASSOCIATION OR BY THE REAL ESTATE BROKERS OR THEIR CONTRACTORS,\n       AGENTS OR EMPLOYEES AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX\n       CONSEQUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT RELATES; THE\n       PARTIES SHALL RELY SOLELY UPON THE ADVICE OF THEIR OWN COUNSEL AS TO THE\n       LEGAL AND TAX CONSEQUENCES OF THIS LEASE. IF THE SUBJECT PROPERTY IS\n       LOCATED IN A STATE OTHER THAN CALIFORNIA, AN ATTORNEY FROM THE STATE\n       WHERE THE PROPERTY IS LOCATED SHOULD BE CONSULTED.\n\nThe parties hereto have executed this Lease at the place on the dates specified\nabove to their respective signatures.\n\nExecuted at:   \n            ------------------------------\non:            \n   ---------------------------------------\n\nBy LESSOR:                           \n\n------------------------------------------\n\n------------------------------------------\n\nBy:                                       \n    --------------------------------------\nName Printed: Harry S. Brown\nTitle:\n      ------------------------------------\nBy: \n   ---------------------------------------\nName Printed:\n             -----------------------------\nTitle: \n      ------------------------------------\nAddress:\n        ----------------------------------\n\n------------------------------------------\nTelephone: (714) 498-4328\n          --------------------------------\nFacsimile: (714) 498-0260\n          --------------------------------\n\nBROKER:\n\nExecuted at:\n\n         ---------------------------------\non:\n   ---------------------------------------\nBy:\n   ---------------------------------------\nName Printed: Jeff Barnes\n             -----------------------------\nTitle:\n      ------------------------------------\nAddress: 4370 La Jolla Village Drive, #990\n        ----------------------------------\n         San Diego, CA 92122-1233\n------------------------------------------\nTelephone: (619) 453-0505\n          --------------------------------\nFacsimile: (619) 453-1981\n          --------------------------------\n\nExecuted at: DALTON, GA\n            ------------------------------\non:          FEB. 19, 1996\n   ---------------------------------------\n\nBy LESSEE:\n\n------------------------------------------\n\n------------------------------------------\n\nBy: Mohawk Industries, Inc. a Georgia Corporate\n    --------------------------------------\nName Printed: S.W. Sharpe\n     -------------------------------------\nTitle: Exec. V.P.\n      ------------------------------------\nBy: \/s\/ S.H. Sharpe\n   ---------------------------------------\nName Printed:\n             -----------------------------\nTitle: \n      ------------------------------------\nAddress:\n        ----------------------------------\n------------------------------------------\nTelephone: (   )         \n          --------------------------------\nFacsimile: (   )         \n          --------------------------------\n\nBROKER:\n\nExecuted at:\n\n         ---------------------------------\non:\n   ---------------------------------------\nBy: \/s\/ Chris Coyte\n   ---------------------------------------\nName Printed: Chris Coyte\n             -----------------------------\nTitle: Senior Vice President\n      ------------------------------------\nAddress: 3991 MacArthur Blvd., Suite 100\n        ----------------------------------\n         Newport Beach, CA 92660\n------------------------------------------\nTelephone: (714) 724-1000\n          --------------------------------\nFacsimile: (714) 833-0608\n          --------------------------------\n\nNOTICE:         These forms are often modified to meet changing requirements\n                of law and needs of the industry. Always write or call to\n                make sure you are utilizing the most current form: AMERICAN\n                INDUSTRIAL REAL ESTATE ASSOCIATION, 345 So. Figueroa St.,\n                Suite M-l, Los Angeles, California 90071 (213) 687-8777.\n\n\n                                      -11-\n\n \n                                    EXHIBIT A\n\n                              SITE PLAN OF PREMISES\n\n                                    [GRAPHIC]\n\n                         WASHINGTON DISTRIBUTION CENTER\n                11954 E. WASHINGTON BOULEVARD o SANTA FE SPRINGS\n\n \n            EXHIBIT \"A\"\n\n                              SITE PLAN OF PREMISES\n\n                                    [GRAPHIC]\n\n                              5225 LOVELOCK STREET\n                                   SAN DIEGO\n\n                                  NOT TO SCALE\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8244],"corporate_contracts_industries":[9462],"corporate_contracts_types":[9583,9579],"class_list":["post-41828","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-mohawk-industries-inc","corporate_contracts_industries-manufacturing__textiles","corporate_contracts_types-land__ca","corporate_contracts_types-land"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/41828","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=41828"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=41828"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=41828"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=41828"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}