Common use of Letter of Credit Clause in Contracts

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Term.

Letter of Credit. In addition to Within five (5) business days following Sublandlord’s receipt of the Security Deposit and as security hereunderRequired Consents, Tenant Subtenant shall deliver to LandlordSublandlord, concurrently with Tenant’s execution as protection for the full and faithful performance by Subtenant of this Leaseall of its obligations under the Sublease and for all losses and damages Sublandlord may suffer (or which Sublandlord reasonably estimates that it may suffer) as a result of any breach or default by Subtenant under the Sublease, an unconditional, clean, irrevocable stand-by negotiable standby letter of credit (the “L/C”) in the amount of One Two Million Five Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.002,500,000) (the “L/C Amount”), in substantially the same form as attached hereto as Exhibit B, drawn on by Bank of America, N.A. (the “Bank”). Said letter of credit Subtenant shall be maintain the L/C in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of place throughout the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord Sublandlord shall have the right to draw upon it in full if it is not renewed at least thirty (30) days before the full stated expiration date thereof. Sublandlord shall have the right to draw down an amount up to the face amount of such letter the L/C if any default occurs under the Sublease to cure any breach or default of credit Subtenant and/or to compensate Sublandlord for any and to hold such amount as part all damages of any kind or nature sustained or which Sublandlord reasonably estimates that it will sustain resulting from Subtenant’s breach or default. The use, application or retention of the Security Deposit L/C, or any portion thereof, by Sublandlord shall not prevent Sublandlord from exercising any other right or remedy provided by the Sublease or by any applicable law. In the event Sublandlord draws down on the L/C pursuant to this Section 7, the funds shall be held by Sublandlord pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount 4 of the letter of credit can be drawn by Landlord pending determination of said amountSublease. Notwithstanding the foregoingIf, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of any drawing by Sublandlord on the defaultL/C pursuant to its rights herein, as a setoff for full or partial compensation for the default. If any portion amount of the letter of credit is drawn after a default by TenantL/C shall be less than the L/C Amount, Tenant shall Subtenant shall, within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five thereafter, provide Sublandlord with (5i) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions an amendment to the principal L/C restoring such L/C to the L/C Amount or (ii) additional L/Cs in an amount equal to the deficiency, which additional L/Cs shall comply with all of the letter provisions of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termthis Section 7.

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently Concurrently with Tenant’s execution of this Lease, Tenant shall deliver to Landlord, as protection for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer (or which Landlord reasonably estimates that it may suffer) as a result of any breach or default by Tenant under this Lease, an irrevocable stand-by and unconditional negotiable standby letter of credit (the “Letter of Credit”), in the form attached hereto as Exhibit F and containing the terms required herein, naming Landlord as the beneficiary and issued by a solvent, nationally recognized bank with a long term rating of BBB or higher, under the supervision of the Superintendent of Banks of the State of California, or a national banking association, in the amount of Ninety One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Seventy Eight and 00/100 Dollars ($166,229.0091,278.00)(the “Letter of Credit Amount”). Said letter The Letter of credit Credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31“callable” at site, 2005irrevocable and unconditional, or (ii) shall provide be maintained in effect, whether through renewal or extension, for automatic annual renewals through the period from the Lease Commencement Date and continuing until the date that is the date which that is sixty (60) days after the Expiration Date expiration of the Term (the “LC Expiration Date”), (iii) be fully assignable by Landlord, its successors and assigns, (iv) permit partial draws and multiple presentations and drawings, and (v) be otherwise subject to the Uniform Customs and Practices for Documentary Credits (2007), International Chamber of this LeaseCommerce Publication #600, or the International Standby Practices-ISP 98, International Chamber of Commerce Publication #590. In addition to the event foregoing, the letter form and terms of credit is issued with an annual renewal obligation the Letter of Credit (and the letter bank issuing the same (the “Bank”)) shall be acceptable to Landlord, in Landlord’s sole discretion. Tenant shall deliver a new Letter of credit is not renewed by the issuing financial institution on Credit or before twenty certificate of renewal or extension to Landlord at least thirty (2030) days prior to the then-scheduled expiration date of the letter Letter of creditCredit then held by Landlord, without any action whatsoever on the part of Landlord. Landlord, or its then Landlord managing agent, shall have the right to draw down an amount up to the full face amount of such letter the Letter of credit and to hold Credit if any of the following shall have occurred or be applicable: (a) such amount as part of is due to Landlord under the Security Deposit pursuant to Section 4.3 terms and conditions of this Lease, or (b) Tenant has filed a voluntary petition under the U. S. Bankruptcy Code or any state bankruptcy code (collectively, “Bankruptcy Code”), or (c) an involuntary petition has been filed against Tenant under the Bankruptcy Code, or (d) the Bank has notified Landlord that the Letter of Credit will not be renewed or extended through the LC Expiration Date and Tenant has failed to timely replace the Letter of Credit in accordance with this Article 26. Upon any default The Letter of Credit will be honored by Tenant, including specifically Tenantthe Bank regardless of whether Tenant disputes Landlord’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled right to draw upon said letter the Letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermCredit.

Letter of Credit. In addition (a) With respect to all Facilities to be constructed in accordance with the Security Deposit Master Funding and Development Agreement, until completion of all such Facilities, the letter of credit requirements relating thereto shall be addressed in the applicable Project Development Agreements. (b) With respect to each Existing ACH Facility, until the Final Completion Date and as security hereunderfor the obligations of the applicable Facility Lessee under this Lease and all Other Agreements to which such Facility Lessee is or becomes a party, Tenant Guarantor or, at Guarantor's option, Lessee shall obtain and deliver to Landlord, concurrently with Tenant’s execution of this Lease, Lessor an irrevocable stand-by letter of credit conforming to the requirements in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars subsection ($166,229.00). Said c) below, except that such letter of credit shall be in form an amount of Fifty Percent (50%) of one (1) year's Base Rent relating to such Existing ACH Facility. In the event there shall be more than one Existing ACH Facility under this Lease prior to the Final Completion Date, Guarantor may, at its option, satisfy the letter of credit requirements under this Section 38.14(b) by providing one (1) letter of credit satisfying the letter of credit requirements of this Section 38.14(b). (c) Upon the Final Completion Date and with as security for the substance Letter of Exhibit F attached heretoCredit Obligations, Guarantor or, at Guarantor's option, Lessee shall obtain and issued by Silicon Valley Bank or by another deliver to Lessor an irrevocable letter of credit at a financial institution located in Orange County and which is reasonably acceptable to LandlordLessor naming Lessor as beneficiary thereunder (the "Letter of Credit"), which Letter of Credit shall be upon such other terms, conditions and provisions acceptable to Lessor (including, without limitation, an "evergreen" provision requiring no less than sixty (60) days' prior written notice to Lessor of any failure or refusal to renew such Letter of Credit). Subject to the proviso below, the Letter of Credit shall be in the amount of Fifty Percent (50%) of one (1) year's Base Rent relating to all Facilities. The Letter of Credit or any replacement letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord Lessor shall be entitled to draw upon said letter such Letter of credit by Credit upon the issuance occurrence of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount Event of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permittedDefault. In the event that Tenant has not been in default under the Lease (beyond the expiration Lessor receives a notice of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount termination or nonrenewal of the Letter of Credit or any replacement letter of credit, Guarantor or, at Guarantor's option, Lessee shall provide a replacement letter of credit in no later than thirty (30) days prior to the amount expiration or termination of Thirty Three Thousand Two Hundred Forty-Six Dollars such Letter of Credit or replacement letter of credit, which replacement letter of credit ($33,246.00i) each shall confirm that it shall take effect immediately upon the expiration of the twelfth expiring Letter of Credit (12th), twenty-fourth (24th), thirty-sixth (36thor such other than current replacement letter of credit), and forty-eighth (48thii) months shall be in form and substance satisfactory to Lessor in its reasonable discretion. Lessee shall maintain throughout the Term a letter of credit conforming to the Termrequirements of this Section 38.14.

Letter of Credit. In addition to Upon the Security Deposit execution and as security hereunderdelivery of this Lease, Tenant shall deliver to LandlordLandlord as security for the performance of the obligations of Tenant hereunder, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by either a cash deposit or a letter of credit in the Security Deposit amount specified in Exhibit A in accordance with this Section (as renewed, replaced, increased and/or reduced pursuant to this Section, the “Letter of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00Credit”). Said letter If Tenant elects to deliver a Letter of credit Credit, such Letter of Credit shall be in such form as Landlord may reasonably approve. If there is more than one Letter of Credit so delivered by Tenant, such Letters of Credit shall be collectively hereinafter referred to as the “Letter of Credit”. The Letter of Credit (i) shall be irrevocable and with the substance of Exhibit F attached hereto, and shall be issued by a commercial bank reasonably acceptable to Landlord (Landlord acknowledging that Silicon Valley Bank or by another financial institution located in Orange County and which is an acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31bank), 2005, or (ii) shall provide for automatic annual renewals through require only the presentation to the issuer of a certificate of the holder of the Letter of Credit stating either (a) that date which is sixty (60) days a default has occurred under this Lease after the Expiration Date expiration of any applicable notice and cure period (or stating that transmittal of a default notice is barred by applicable bankruptcy or other law if such is the case), or (b) stating that Tenant has not delivered to Landlord a new Letter of Credit having a commencement date immediately following the expiration of the Term existing Letter of this Credit in accordance with the requirements of the Lease. In , (iii) shall be payable to Landlord and its successors in interest as the event Landlord and shall be freely transferable without cost to any such successor or any lender holding a collateral assignment of Landlord’s interest in the letter Lease, (iv) shall be for an initial term of credit is issued with an annual renewal obligation not less than one year and contain a provision that such term shall be automatically renewed for successive one-year periods unless the letter of credit is not renewed by the issuing financial institution on or before twenty issuer shall, at least thirty (2030) days prior to the then-scheduled expiration date date, give Landlord written notice of such nonrenewal, and (v) shall otherwise be substantially in the form of the letter of creditcredit attached hereto as Exhibit J. Notwithstanding the foregoing, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part term of the Security Deposit pursuant to Section 4.3 Letter of this Credit for the final period of the Term shall be for a term ending not earlier then the date forty-five (45) days after the last day of the Term. If Tenant shall be in default under the Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure after the same within expiration of any applicable notice or cure periodperiod (or if transmittal of a default or other notice is stayed or barred by applicable bankruptcy or other law), Landlord shall be entitled to draw upon said letter the Letter of credit by the issuance of Landlord’s sole written demand Credit to the issuing financial institution. Such draw shall be in an amount extent reasonably necessary to cure such default. If, not less than thirty (30) days before the default scheduled expiration of the Letter of Credit, Tenant has not delivered to Landlord a new Letter of Credit having a commencement date immediately following the expiration of the existing Letter of Credit in question and accordance with this Section, Landlord shall also have the right to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then draw upon the full amount of the letter Letter of credit can Credit without giving any further notice to Tenant. Landlord may, but shall not be obligated to, apply the amount so drawn to the extent necessary to cure Tenant’s default under the Lease. Any funds drawn by Landlord pending determination on the Letter of said amount. Notwithstanding the foregoing, while the amount of any such draw Credit and not applied against amounts due hereunder shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred held by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease)a cash security deposit, then provided that Landlord shall promptly refund have no fiduciary duty with regard to such amounts, shall have the right to commingle such amounts with other funds of Landlord, and shall pay no interest on such amounts. After any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result application of the default, as a setoff for full or partial compensation for the default. If any portion Letter of the letter of credit is drawn after a default Credit by TenantLandlord in accordance with this paragraph, Tenant shall reinstate the Letter of Credit to the amount then required to be maintained hereunder, within thirty (30) days of demand. Within forty-five (545) days after written demand the expiration or earlier termination of the Term the Letter of Credit and any cash security deposit then being held by Landlord restore Landlord, to the letter of credit. Failure to so restore said letter of credit within said five (5) days extent not applied, shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions returned to the principal amount Tenant provided that no Event of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermDefault is then continuing.

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently 25.1 Simultaneously with Tenant’s execution of this Lease, an irrevocable stand-as additional protection for Landlord to assure the performance by Tenant of the terms of this Lease, Tenant shall post a letter of credit with Landlord (the “Letter of Credit”), in a form and from a bank and otherwise satisfying the terms and conditions set forth in Section 25.2 below, in the amount set forth in Item 8 of the Summary (the “L/C Amount”). If (1) the term of the Letter of Credit (or any extension thereof or substitute or new Letter of Credit provided to Landlord) held by Landlord will expire prior to the 120th day after the last day of the Lease Term and the Letter of Credit is not extended, or a new Letter of Credit for an extended period of time is not substituted, in either case prior to the expiration of the Letter of Credit, (2) Tenant commits a Default with respect to any provision of this Lease, (3) Tenant files in a court of competent jurisdiction a voluntary petition under the Federal Bankruptcy Code, or (4) an involuntary petition has been filed against Tenant in a court of competent jurisdiction under the Federal Bankruptcy Code, which remains undismissed or undischarged for a period of seventy-five (75) days after filing, Landlord may (but shall not be required to) draw upon the Letter of Credit, to the extent of (a) the payment of any sum which is in Default (including, without limitation, any Default under Section 18.1.3 above), (b) the payment of any other amount which Landlord may spend or become obligated to spend by reason of Tenant’s Default, (c) to compensate Landlord for any loss or damage which Landlord may suffer by reason of Tenant’s Default, or (d) the full face amount of the Letter of Credit following the occurrence of any of the events (after expiration of the applicable 75-day period) described in clauses (3) and (4) hereinabove which trigger Landlord’s ability to draw on the Letter of Credit as set forth above. If any portion of the Letter of Credit proceeds are so used or applied, Tenant shall, within ten (10) days after demand therefor, post an additional Letter of Credit in an amount to cause the aggregate amount of the unused proceeds and such new Letter of Credit to equal the required L/C Amount hereunder. 25.2 The Letter of Credit shall be: (a) in form and substance satisfactory to Landlord in its reasonable discretion; (b) in the amount of One Hundred Sixty Six Thousand Two Hundred Twentythe then-Nine Dollars effective L/C Amount ($166,229.00as reduced below). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, unless drawn upon, and shall permit multiple draws; (c) issued by Silicon Valley Bank or by another financial institution a commercial bank reasonably acceptable to Landlord and located in Orange County the continental United States and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005payable at such bank, or local branch of such bank, in Los Angeles, California, San Francisco, California, Houston, Texas or New York, New York; (iid) shall provide for automatic annual renewals through that date which is sixty of an initial term not less than one year; (60e) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty at least thirty (2030) days prior to the then-scheduled current expiration date of the letter of credit, then either (1) renewed or automatically extended from time to time through the 120th day after expiration of the Lease Term, or (2) replaced with a substitute letter of credit; in the amount of the then-effective L/C Amount (as reduced below) and (f) shall be transferable at no cost to the beneficiary thereof. Tenant agrees not to interfere in any way with payment by the issuer of the Letter of Credit to Landlord shall have of the proceeds of the Letter of Credit, regardless of whether any dispute exists between Tenant and Landlord as to Landlord’s right to draw from the full amount Letter of such letter Credit, provided that Tenant shall retain all rights and remedies against Landlord in connection therewith. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of credit Credit or any renewal thereof or any proceeds thereof be deemed to be or treated as a security deposit under any Applicable Laws. The parties hereto (i) recite that the Letter of Credit is not intended to serve as a security deposit and any and all other laws, rules and regulations applicable to hold such amount as part of security deposits in the commercial context (“Security Deposit Laws”) shall have no applicability or relevancy thereto and (ii) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand Laws 25.3 Notwithstanding anything above to the issuing financial institution. Such draw shall be in an amount necessary to cure contrary, the default in question and to compensate Landlord for all damages incurred therebyL/C Amount of Letter of Credit, as determined by Landlord in its sole and absolute discretionincluding, and if such amount cannot be readily determined by Landlordwithout limitation, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw additional Letter of Credit as may be required by this Lease, shall be determined in Landlord’s sole reduced by one-quarter (1/4) of its original amount on the first anniversary of the Lease Commencement Date, and absolute discretion as provided in on each annual anniversary thereafter, until the foregoingL/C Amount is equal to $0 (i.e., if such that, upon the amount 4-year anniversary of any the Lease Commencement Date, the L/C Amount would equal $0), and such draw(s) that no Letter of Credit shall ultimately exceed the amount of damages actually incurred be retained by Landlord (each of such reduction dates hereinafter referred to as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Leasean “Adjustment Date”), provided no uncured monetary or material non-monetary Default then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have exists under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the defaultsuch applicable Adjustment Date. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five Within ten (510) days after Tenant’s written demand request, Landlord shall notify the issuer of any Letter of Credit of each such reduction, which reduction shall occur by means of delivery by Tenant to Landlord, at Tenant’s cost, of a substitute Letter of Credit in the applicable amount (or an amendment to the existing Letter of Credit). 25.4 In the event of the sale or transfer of Landlord’s interest in the Building, Landlord restore shall transfer the letter Letter of credit. Failure Credit to so restore said letter the purchaser or assignee, If Landlord transfers the Letter of credit within said five Credit to a transferee of the Building or Landlord’s interest therein, then such transferee (5and not Landlord) days shall be liable for its return so long as Tenant receives a default by Tenant copy of the written agreement between the transferor and the transferee documenting the transfer and pursuant to which the transferee prospectively assumes Landlord’s obligations under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Term.[SIGNATURE PAGE FOLLOWS]

Letter of Credit. In addition to the Security Deposit and as security hereunderUpon execution of this Lease, Tenant shall deliver to LandlordLandlord a clean, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit (the “Letter of Credit”) established in Landlord’s (and its successors’ and assigns’) favor in the amount Letter of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars Credit Amount, issued by a federally insured banking or lending institution ($166,229.00). Said letter of credit shall be i.e., insured by the FDIC) with a retail banking branch located within the continental United States reasonably acceptable to Landlord and in other form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is reasonably acceptable to Landlord. The Letter of Credit shall specifically provide for partial draws, shall be self-renewing annually as an “Evergreen” letter of credit credit, without amendment, for additional one-year periods, shall either: have a term that is self-renewing until sixty (i60) days after the expiration of the Term of the Lease and shall by its terms be issued with transferable by the beneficiary thereunder for a fixed expiration date transfer fee not to exceed $250.00 payable by Tenant. If Tenant fails to make any payment of December 31, 2005rent or other charges due to Landlord under the terms of the Lease, or otherwise defaults hereunder, beyond any applicable notice and cure period, Landlord, at Landlord’s option, may make a demand for payment under the Letter of Credit in an amount equal to the amounts then due and owing to Landlord under the Lease. In the event that Landlord draws upon the Letter of Credit, Tenant shall present to Landlord a replacement Letter of Credit in the full Letter of Credit Amount satisfying all of the terms and conditions of this Section within ten (ii10) days after receipt of notice from Landlord of such draw. Tenant’s failure to do so within such 10-day period will constitute a default hereunder (Tenant hereby waiving any additional notice and grace or cure period), and upon such default Landlord shall provide for automatic annual renewals through be entitled to immediately exercise all rights and remedies available to it hereunder, at law or in equity. In the event that the Letter of Credit is terminated by the issuer thereof prior to the date which that is sixty (60) days after the Expiration Date of the Term expiration date of this Lease. In , as set forth above, and Tenant has not presented to Landlord a replacement Letter of Credit which complies with the event terms and conditions of the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution Lease on or before twenty thirty (2030) days prior to the then-scheduled expiration date of the letter any such Letter of creditCredit then held by Landlord, then Landlord Tenant shall be deemed in default hereunder and Landlord, in addition to all other rights and remedies provided for hereunder, shall have the right to draw upon the full Letter of Credit then held by Landlord and any such amount paid to Landlord by the issuer of the Letter of Credit shall be held in a segregated account by Landlord as security for the performance of Tenant’s obligations hereunder. Any interest earned on such letter amounts shall be the property of credit Landlord. Landlord’s election to draw under the Letter of Credit and to hold such amount as part the proceeds of the Security Deposit pursuant drawing under the Letter of Credit in a segregated account shall not be deemed a cure of any default by Tenant hereunder and shall not relieve Tenant from its obligation to Section 4.3 present to Landlord a replacement Letter of Credit which complies with the terms and conditions of this Lease. Upon Tenant acknowledges that any default proceeds of a draw made under the Letter of Credit and thereafter held in a segregated account by Tenant, including specifically Tenant’s failure to pay rent or to abide Landlord may be used by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure Landlord to cure or satisfy any obligation of Tenant hereunder as if such proceeds were instead proceeds of a draw made under a Letter of Credit that remained outstanding and in full force and effect at the same within time such amounts are applied by Landlord to cure or satisfy any applicable cure periodsuch obligation of Tenant. Tenant hereby affirmatively disclaims any interest Tenant has, may have, claims to have, or may claim to have in any proceeds drawn by Landlord under the Letter of Credit and held in accordance with the terms hereof. Without limiting the generality of the foregoing, Tenant expressly acknowledges and agrees that at the end of the Term of the Lease (whether by expiration or earlier termination hereof), and if Tenant is not then in default under this Lease, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand return to the issuing financial institution. Such draw shall be issuer of the Letter of Credit or its successor (or as such issuer may direct in an amount necessary to cure writing) any remaining and unapplied proceeds of any prior draws made under the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretionLetter of Credit, and if Tenant shall have no rights, residual or otherwise, in or to such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amountproceeds. Notwithstanding In addition to the foregoing, while Landlord will have the amount right to require Tenant to have a new Letter of any Credit issued in accordance with the above requirements from a different Issuer if either the original Issuer is placed on an FDIC “watch list”, if the FDIC or similar state or federal banking regulatory agency is appointed as receiver or conservator for such draw shall be determined Issuer or if Landlord analyzes such Issuer’s capitalization, asset quality, earnings, and/or liquidity and in Landlord’s sole and absolute discretion discretion, disapproves of such Issuer’s financial wherewithal and ability to remain as provided the issuer of the Letter of Credit. Such new Letter of Credit must comply with the foregoing requirements and must be issued within thirty (30) days of Landlord’s demand therefor. Provided Tenant is not then in the foregoing, if the amount default (regardless of any such draw(snotice and cure periods) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant and has not been in default under the this Lease (beyond the expiration of any applicable notice and cure periodperiods during the prior twelve (12) at any time months, the Letter of Credit Amount shall reduce during the Term hereofof this Lease on the first date of the respective Lease Year as set forth below: Date of Reduction Amount of Reduction of Letter of Credit Remaining Letter of Credit Amount after Reduction First day of the 2nd Lease Year of the Term $ 13,148.44 $ 52,593.76 First day of the 3rd Lease Year of the Term $ 13,148.44 $ 39,445.32 First day of the 4th Lease Year of the Term $ 13,148.44 $ 26,296.88 First day of the 5th Lease Year of the Term $ 13,148.44 $ 13,148.44 Should Tenant be in default (regardless of any notice and cure periods) as of the specified reduction date, and provided further or if Tenant otherwise has been in default as specified above beyond any applicable notice and/or cure periods, no reduction shall occur as of such applicable date. The Letter of Credit shall specifically provide that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period Letter of Credit is subject to reduction in accordance with respect to any payments the terms of rent due under the Lease. If Tenant is then or has been in default and the Letter of Credit balance is not or was not reduced, then upon at the written request first date of Tenantthe next scheduled reduction Lease Year, Landlord shall authorize in writing consecutive reductions the Letter of Credit Amount will only be reduced by the next scheduled reduction amount and will not skip to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termotherwise applicable Lease Year.

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00100,000.00). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another a financial institution located in Orange County Southern California and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December January 31, 20052006, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such , which draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or of any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five ten (510) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five ten (510) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In If on or after the event that second annual anniversary of the Commencement Date of this Lease: (a) Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that (b) Tenant has not at any time been more than five ten (510) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, and (c) Tenant shall demonstrate by the delivery to Landlord of its audited financial statements that Tenant has achieved a positive net income and a positive net worth for the most current quarter (as determined by generally accepted accounting principles, consistently applied, and issued by a nationally recognized accounting firm), then upon the written request of TenantTenant accompanied by copies of the audited financial statements required in Subsection (c) of this paragraph, Landlord shall authorize in writing consecutive reductions to the principal amount an immediate full exoneration and release of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termcredit.

Letter of Credit. In addition Notwithstanding anything to the contrary contained herein, Tenant shall have the option to deliver to Landlord a Letter of Credit (as set forth below) in lieu of the Security Deposit and as security hereunderset forth in Section 5.01 above. If Tenant elects to post a Letter of Credit in lieu of the Security Deposit, then the following shall apply: (a) No later than February 1, 2004, Tenant shall deliver to Landlord the Letter of Credit described below as security for Tenant’s performance of all of Tenant’s covenants and obligations under this Lease; provided, however, that neither the Letter of Credit nor any Letter of Credit Proceeds (as defined below) shall be deemed an advance rent deposit or an advance payment of any other kind, or a measure of Landlord’s damages upon Tenant’s default. The Letter of Credit shall be maintained in effect from the date thereof through January 31, 2011 (the “LOC Expiration Date”), and provided that on the LOC Expiration Date, Tenant shall not be in Default, Landlord shall return to Tenant the Letter of Credit and any Letter of Credit Proceeds then held by Landlord (other than those held for application by Landlord on account of a Default as provided below). Landlord shall not be required to segregate the Letter of Credit Proceeds from its other funds and no interest shall accrue or be payable to Tenant with respect thereto. Landlord may (but shall not be required to) draw upon the Letter of Credit and use the proceeds therefrom (the “Letter of Credit Proceeds”) or any portion thereof to cure any Default under this Lease, it being understood that any use of the Letter of Credit Proceeds shall not constitute a bar or defense to any of Landlord’s remedies set forth in this Lease. In such event and upon written notice from Landlord to Tenant specifying the amount of the Letter of Credit Proceeds so utilized by Landlord and the particular purpose for which such amount was applied, Tenant shall immediately deliver to Landlord an amendment Letter of Credit or a replacement Letter of Credit in an amount equal to the difference between the amount of the required Letter of Credit and the amount so expended. Tenant’s failure to deliver such amendment to the Letter of Credit or replacement Letter of Credit to Landlord within five (5) business days of Landlord’s notice shall constitute a Default hereunder. If Tenant is not in Default on the LOC Expiration Date, within forty-five (45) days after such date, Landlord shall return to Tenant the Letter of Credit or the balance of the Letter of Credit Proceeds then held by Landlord; provided, however, that in no event shall any such return be construed as an admission by Landlord that Tenant has performed all of its obligations hereunder. No purchaser at any judicial or private foreclosure sale of the Real Property or any portion thereof, shall be responsible to Tenant for such Letter of Credit or any Letter of Credit Proceeds unless such holder or purchaser shall have actually received the same. (b) As used herein, Letter of Credit shall mean an unconditional, irrevocable letter of credit (hereinafter referred to as the ‘Letter of Credit”) issued by the San Francisco Bay Area office of a major national bank satisfactory to Landlord (the “Bank”), naming Landlord as beneficiary, in the initial amount of Four Hundred Fifty Thousand and No/100 Dollars ($450,000.00). The Letter of Credit shall be for not less than a one-year term and shall provide that (i) Landlord may make partial and multiple draws upon the Letter of Credit up to the full amount thereof, as determined by Landlord, concurrently (ii) the Bank will pay to Landlord the amount of such draw upon receipt by the Bank of a sight draft signed by Landlord, together with a written certification from Landlord that Tenant is in Default, (iii) Landlord is therefore entitled to draw such amount; and (iv) in the event of Landlord’s assignment or other transfer of its interest in this Lease, the Letter of Credit shall be freely transferable by Landlord, without charge and without recourse, to the assignee or transferee of such interest and the Bank shall confirm the same to Landlord and such assignee or transferee. In the event that the Bank shall fail to notify Landlord that the Letter of Credit will be renewed for at least one (1) year beyond the then applicable expiration date, and Tenant shall not have delivered to Landlord, at least thirty (30) days prior to the relevant annual expiration date, a replacement Letter of Credit in the amount required hereunder and otherwise meeting the requirements set forth above, then Landlord shall be entitled to draw on the Letter of Credit as provided above, and shall hold the proceeds of such draw as Letter of Credit Proceeds pursuant to Section 5.02(a) above. (c) Notwithstanding anything to contrary contained herein, if Tenant is not in Default under the Lease on February 1, 2006, the replacement Letter of Credit may be issued in the amount of Four Hundred Five Thousand and No/100 Dollars ($405,000.00). If Tenant is not in Default under the Lease on February 1, 2007, the replacement Letter of Credit may be issued in the amount of Three Hundred Sixty Thousand and No/100 Dollars ($360,000.00). If Tenant is not in Default under the Lease on February 1, 2008, the replacement Letter of Credit may be issued in the amount of Three Hundred Fifteen Thousand and No/100 Dollars ($315,000.00). If Tenant is not in Default under the Lease on February 1, 2009, the replacement Letter of Credit may be issued in the amount of Two Hundred Seventy Thousand and No/100 Dollars ($270,000.00). If Tenant is not in Default under the Lease on February 1, 2010, the replacement Letter of Credit may be issued in the amount of Two Hundred Twenty Five Thousand and No/100 Dollars ($225,000.00). (d) The cost of the Letter of Credit shall be paid by Tenant’s execution . If Tenant shall fully and faithfully comply with all the terms, provisions, covenants, and conditions of this Lease, an irrevocable stand-by letter the Letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit Credit, or any balance thereof, shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable returned to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days Tenant after the Expiration Date following: (a) the expiration or earlier termination of the Term of this Lease. In ; (b) the event removal of Tenant and its property from the letter of credit is issued with an annual renewal obligation and Premises; (c) the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date surrender of the letter of credit, then Premises by Tenant to Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of in accordance with this Lease. Upon any default ; and (d) the payment by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount Tenant of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoingoutstanding Rent, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined including, without limitation, all Rent Adjustments due pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund Lease as computed by Landlord. If Tenant fails timely to perform any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have obligation under this Lease or at law or in equity as Article Five, such breach shall constitute a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default Default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration without any right to or requirement of any applicable further notice or cure period) at period under any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments other Article of rent due under the this Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), except such notice and forty-eighth (48th) months of the Termcure period expressly provided under this Article Five.

Letter of Credit. In addition to the Security Deposit and as security hereunder, 53.1 Tenant shall deliver to Landlord, concurrently with as collateral for the full performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer as a result of Tenant’s execution failure to comply with one or more provisions of this Lease, including, but not limited to, any post lease termination damages under Section 1951.2 of the California Civil Code, an irrevocable stand-by letter Irrevocable Standby Letter of credit Credit (the “Letter of Credit”) in the amount of One Hundred Sixty Six Thirty-Seven Thousand Two Five Hundred TwentyFifty-Nine Three and 56/100’s Dollars ($166,229.00137,553.56). Said The following terms and conditions shall apply to the Letter of Credit: 53.2 The Letter of Credit shall be in favor of Landlord, shall be issued by a bank acceptable to Landlord with a Standard & Poors rating of “A” or better, shall comply with all of the terms and conditions of this Article and shall otherwise be in the form attached hereto as Exhibit I. Landlord hereby approves Union Bank as an acceptable bank as of the date of this Lease. 53.3 The Letter of Credit or any replacement Letter of Credit shall be irrevocable for the term thereof and shall automatically renew on a year to year basis until a period ending not earlier than two months subsequent to the Termination Date (the “LOC Expiration Date”) without any action whatsoever on the part of Landlord; provided that the issuing bank shall have the right not to renew the Letter of Credit by giving written notice to Landlord not less than sixty (60) days prior to the expiration of the then current term of the Letter of Credit that it does not intend to renew the Letter of Credit. Tenant understands that the election by the issuing bank not to renew the Letter of Credit shall not, in any event, diminish the obligation of Tenant to deposit the Security Deposit, if any, or maintain such an irrevocable Letter of Credit in favor of Landlord through the LOC Expiration Date. 53.4 Landlord, or its then authorized representative, upon Tenant’s failure to comply with one or more provisions of this Lease, or as otherwise specifically agreed by Landlord and Tenant pursuant to this Lease or any amendment hereof, without prejudice to any other remedy provided in this Lease or by Laws, shall have the right from time to time to make one or more draws on the Letter of Credit and use all or part of the proceeds in accordance with Section 53.5 below. In addition, if Tenant fails to furnish a renewal or replacement letter of credit shall be in form and complying with all of the substance provisions of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable this Article 53 at least sixty (60) days prior to Landlord. The letter of credit shall either: (i) be issued with a fixed the stated expiration date of December 31the Letter of Credit then held by Landlord, 2005Landlord may draw upon such Letter of Credit and hold the proceeds thereof (and such proceeds need not be segregated) in accordance with the terms of this Article 53. Funds may be drawn down on the Letter of Credit upon presentation to the issuing bank of Landlord’s (or Landlord’s then authorized representative’s) certification set forth in Exhibit I. 53.5 Tenant acknowledges and agrees (and the Letter of Credit shall so state) that the Letter of Credit shall be honored by the issuing bank without inquiry as to the truth of the statements set forth in such draw request and regardless of whether the Tenant disputes the content of such statement. The proceeds of the Letter of Credit shall constitute Landlord’s sole and separate property (and not Tenant’s property or the property of Tenant’s bankruptcy estate) and Landlord may immediately upon any draw (and without notice to Tenant) apply or offset the proceeds of the Letter of Credit: (a) against any rent or other amounts payable by Tenant under this Lease that is not paid when due; (b) against all losses and damages that Landlord has suffered or that Landlord reasonably estimates that it may suffer as a result of Tenant’s failure to comply with one or more provisions of this Lease, including any damages arising under Section 1951.2 of the California Civil Code following termination of this Lease; (c) against any costs incurred by Landlord in connection with this Lease (including attorneys’ fees); and (d) against any other amount that Landlord may spend or (ii) shall provide for automatic annual renewals through that date which is become obligated to spend by reason of Tenant’s default. Provided Tenant has performed all of its obligations under this Lease, Landlord agrees to pay to Tenant within sixty (60) days after the LOC Expiration Date (as defined in Section 53.3 above) the amount of any proceeds of the Term Letter of Credit received by Landlord and not applied as allowed above; provided, that if prior to the LOC Expiration Date a voluntary petition is filed by Tenant or any guarantor, or an involuntary petition is filed against Tenant or any Guarantor by any of Tenant’s or guarantor’s creditors, under the Federal Bankruptcy Code, then Landlord shall not be obligated to make such payment in the amount of the unused Letter of Credit proceeds until either all preference issues relating to payments under this Lease. In Lease have been resolved in such bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed, in each case pursuant to a final court order not subject to appeal or any stay pending appeal. 53.6 If, as result of any application or use by Landlord of all or any part of the event Letter of Credit, the amount of the Letter of Credit shall be less than the amount set forth in this Article 31, Tenant shall, within five (5) days thereafter, provide Landlord with additional letter(s) of credit in an amount equal to the deficiency (or a replacement letter of credit is issued with an annual renewal obligation in the total amount required pursuant to this Article 53), and the any such additional (or replacement) letter of credit is not renewed shall comply with all of the provisions of this Article 53, and if Tenant fails to comply with the foregoing, notwithstanding anything to the contrary contained in this Lease, the same shall constitute an incurable Event of Default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. 53.7 Landlord may, at any time and without notice to Tenant and without first obtaining Tenant’s consent thereto, transfer all or any portion of its interest in and to the Letter of Credit to another party, person or entity in connection with refinancing or transferring its interest in the Building, including Landlord’s mortgagee, and/or to have the Letter of Credit reissued in the name of Landlord’s mortgagee. If Landlord transfers its interest in the Building and transfers the Letter of Credit (or any proceeds thereof then held by Landlord) in whole or in part to the transferee, Landlord shall, without any further agreement between the parties hereto, thereupon be released by Tenant from all liability therefor. The provisions hereof shall apply to every transfer or assignment of all or any part of the Letter of Credit to a new landlord. In connection with any such transfer of the Letter of Credit by Landlord, Tenant shall, at Tenant’s sole cost and expense, execute and submit to the issuer of the Letter of Credit such applications, documents and instruments as may be necessary to effectuate such transfer. Tenant shall be responsible for paying the issuer’s transfer and processing fees in connection with any transfer of the Letter of Credit and, if Landlord advances any such fees (without having any obligation to do so), Tenant shall reimburse Landlord for any such transfer or processing fees within ten (10) days after Landlord’s written request therefor. 53.8 If the Letter of Credit expires earlier than the LOC Expiration Date, or the issuing financial institution on bank notifies Landlord that it shall not renew the Letter of Credit, Landlord shall accept a renewal thereof or before twenty substitute letter credit (20such renewal or substitute Letter of Credit to be in effect not later than sixty (60) days prior to the then-scheduled expiration date thereof), irrevocable and automatically renewable through the LOC Expiration Date upon the same terms as the expiring Letter of Credit or upon such other terms as may be acceptable to Landlord. However, if (a) the Letter of Credit is not timely renewed, or (b) a substitute Letter of Credit, complying with all of the letter terms and conditions of creditthis paragraph is not timely received, then Landlord may present such Letter of Credit to the issuing bank, and the entire sum so obtained shall have the right be paid to draw the full amount of such letter of credit and Landlord, to hold such amount as part of the Security Deposit pursuant to be held by Landlord in accordance with Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure Notwithstanding the same within any applicable cure periodforegoing, Landlord shall be entitled to draw upon said letter receive from Tenant all attorneys’ fees and costs incurred in connection with the review of credit any proposed substitute Letter of Credit pursuant to this Section. 53.9 Landlord and Tenant (a) acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or any proceeds thereof be deemed to be or treated as a “security deposit” under any Regulation applicable to security deposits in the commercial context including Section 1950.7 of the California Civil Code, as such section now exist or as may be hereafter amended or succeeded (“Security Deposit Laws”), (b) acknowledge and agree that the Letter of Credit (including any renewal thereof or substitute therefor or any proceeds thereof) is not intended to serve as a security deposit, and the Security Deposit Laws shall have no applicability or relevancy thereto, and (c) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws. Tenant hereby waives the provisions of Section 1950.7 of the California Civil Code and all other provisions of Laws, now or hereafter in effect, which (i) establish the time frame by which Landlord must refund a security deposit under a lease, and/or (ii) provide that Landlord may claim from the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount security deposit only those sums reasonably necessary to cure remedy defaults in the default payment of rent, to repair damage caused by Tenant or to clean the Premises, it being agreed that Landlord may, in question and addition, claim those sums specified above in this Section 53.9 and/or those sums reasonably necessary to compensate Landlord for all any loss or damage caused by Tenant’s breach of this Lease or the acts or omission of Tenant or any other Tenant Agent, including any damages incurred therebyLandlord suffers following termination of this Lease. 53.10 Notwithstanding anything to the contrary contained in this Lease, as determined in the event that at any time the financial institution which issues said Letter of Credit is declared insolvent by Landlord in its sole and absolute discretionthe FDIC or is closed for any reason, and if such amount cannot be readily determined by LandlordTenant must promptly, then the full amount of the using commercially reasonable efforts, provide a substitute letter of credit can be drawn by Landlord pending determination that satisfies the requirements of said amount. Notwithstanding the foregoingthis Lease hereby from a financial institution acceptable to Landlord, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termcommercially reasonable discretion.

Letter of Credit. In (a) Subject to the provisions of Section (M) of the Basic Lease Terms, in addition and without limitation to any other security deposit or other security held by Landlord, the event upon the substitution by Tenant of a letter of credit for of the cash portion of the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in the amount of One Four Hundred Sixty Six Thousand Two Hundred Twenty-Nine Fifty and No/100ths Dollars ($166,229.00450,000.00). Said , Tenant shall deposit with Landlord a clean, unconditional and irrevocable letter of credit automatically renewing on an annual basis, in the initial amount of Four Hundred Fifty Thousand and No/100ths Dollars ($450,000.00), which letter of credit shall be substantially in the form annexed hereto as Exhibit G and with incorporated herein by this reference (the substance “Letter of Exhibit F attached heretoCredit”). The Letter of Credit shall be issued by a financial institution pre-approved and reasonably acceptable to Landlord, and issued by Silicon Valley Bank without limitation to the generality of foregoing, the issuer of the Letter of Credit shall at all times maintain a credit rating of at least an A+ S&P rating or a Xx Xxxxx’x rating. In the event that the issuer at any time fall below such credit rating, Landlord may elect to have the Letter of Credit reissued (within thirty (30) days following delivery of a written demand for re-issuance) by another financial institution located in Orange County pre-approved and which is reasonably acceptable to Landlord. All charges under the Letter of Credit, including without limitation, transfer fees, are to be paid by the Tenant. (b) The letter beneficiary shall be an entity named by Landlord. The Letter of credit Credit shall eitherprovide for written notice of non-renewal to be sent directly to the Landlord at least thirty (30) days prior to such renewal date and the expiration date contained in the Letter of Credit shall be a date no earlier than ninety (90) days following the Expiration Date. The amounts secured by the Letter of Credit shall be deemed to be a part of (and in addition to) the Security Deposit under the Lease. The Letter of Credit shall contain a provision whereby the bank agrees to pay the sight draft or give notice of discrepancies on the date of presentation and waives any right to wait five banking days pursuant to Article 16 of the ICC Uniform Customs and Practice for Documentary Credits (2007 Revision). (c) The Letter of Credit shall permit partial draws. Further, the Letter of Credit shall permit the beneficiary to transfer the Letter of Credit to a subsequent owner or beneficiary, and thereupon Landlord shall be discharged from further liability with respect to the Letter of Credit. The following language is required to be included in the Letter of Credit: “A sight draft submitted to the bank by Beneficiary is to be accompanied by a certificate from Beneficiary stating that Beneficiary has the right to draw upon this Letter of Credit based upon the terms of the lease dated Xxxxx 00, 0000”. (x) Tenant hereby acknowledges that the security provided by the Letter of Credit is provided as a continuing material inducement to the Landlord, is provided as current and ongoing value to the Landlord, and constitutes an ongoing contemporaneous exchange for new value given for the Tenant’s tenancy throughout the Term of the Lease, as may be extended as provided in the Lease. (e) At any time that an Event of Default occurs, Landlord (or the beneficiary) shall in its discretion have the right and option to draw down such amounts from the Letter of Credit as are required to cure the Event of Default and apply the proceeds or any part thereof to any applicable amounts owed to Landlord. The proceeds of the Letter of Credit remaining after application of funds, if applicable, shall be held by Landlord as a cash security deposit without interest accruing thereon. Landlord (or the beneficiary) shall also have the right to draw down the entire Letter of Credit in the event Landlord does not receive notice that the date of expiry of the Letter of Credit will be extended by the issuing bank and Tenant fails to obtain and present to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit a substitute Letter of Credit. If Landlord shall have drawn down the Letter of Credit and applied all or a portion, then Tenant shall deposit with Landlord, within three (3) days after notice from Landlord, an amount of cash sufficient to bring the balance of the cash then being held by Landlord under the terms hereof to the amount of the required then face amount of the Letter of Credit. The failure by Tenant to deposit such additional amount within the foregoing time period shall be deemed a default pursuant to the Lease. The Letter of Credit shall not in any way limit any liability of Tenant under the Lease, as hereby amended, nor shall the Letter of Credit be deemed to be “liquidated damages.” If claims of the Landlord exceed the amount of the Letter of Credit, Tenant shall remain liable for the balance of such claims. (f) Notwithstanding anything to the contrary contained in this Lease , until such time as Landlord shall have received the Security Deposit, Tenant hereby acknowledges and agrees that Landlord shall not be required to (i) be issued with a fixed expiration date of December 31, 2005perform any work required by this Lease, or (ii) shall expend any funds required by this Lease (including without limitation the payment of brokerage commissions or the payment of the Allowance (as defined in Exhibit B attached hereto). (g) Notwithstanding anything to the contrary contained herein, if the financial institution issuing the Letter of Credit (1) is on a government “watch list,” (2) is taken over by the FDIC, or (3) becomes, in Landlord’s reasonable opinion, financially insecure (each a “Financial Insecurity Event”). Without limiting Landlord’s other rights hereunder, upon any Financial Insecurity Event, Landlord may, at its discretion and in lieu of drawing on the Letter of Credit, require Tenant to provide for automatic annual renewals through that date which is sixty Landlord with a replacement Letter of Credit in substantially the same form and content as the original Letter of Credit within ten (6010) business days after written notice to Tenant. Failure of Tenant to provide a replacement Letter of Credit within such ten (10) business period shall constitute an Event of Default under the Expiration Date Lease. Time is of the Term essence with respect to Tenant submission of this Lease. In the event the letter any replacement Letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty Credit. (20h) days prior Notwithstanding anything to the then-scheduled expiration date contrary contained herein, beginning on the first day of the letter thirtieth (30th) month following the Commencement Date, provided that (i) no Event of credit, then Landlord shall have the right to draw the full amount of such letter of credit Default has occurred and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretionis continuing, and if such amount cannot be readily determined by Landlord(ii) Tenant has achieved and maintains a positive net annualized cash flow (as defined below), then the full amount of the letter Letter of credit can be drawn by Landlord pending determination of said amount. Credit shall decline pursuant to the following schedule: Month 31 $ 150,000.00 $ 300,000.00 Month 42 $ 150,000.00 $ 150,000.00 Month 53 $ 150,000.00 $ 0.00 Notwithstanding the foregoing, while the face amount of the Letter of Credit shall cease to decline for the balance of the Term upon occurrence and continuation of any such draw Event of Default , notice of which may be delivered to the issuing bank by Landlord. Further, any applicable Reduction Effective Date shall be determined in Landlord’s sole and absolute discretion delayed until such time as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been late in default under the Lease (beyond the expiration payment of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been Rent on more than five one (51) days late more than once during occasion in the applicable previous twelve (12)-month 12) month period with respect to any payments of rent due under and Tenant has demonstrated positive net annualized cash flow for the Leaseprior year. As used herein, then upon the written request of Tenant, Landlord “cash flow” shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termbe calculated as EBITDA less capital expenditures.

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant (a) Subtenant shall deliver an unconditional, clean, irrevocable letter of credit (“Letter of Credit”) to Landlord, Sublandlord in an amount equal to (i) six (6) months Suite 420 Base Rent for the Suite 420 Subleased Premises (the “Suite 420 Letter of Credit”) concurrently with TenantSubtenant’s execution of this LeaseSublease, an irrevocable stand-and (ii) six (6) months Suite 450 Base Rent for the Suite 450 Subleased Premises (the “Suite 450 Letter of Credit”) upon the Suite 450 Commencement Date. For purposes of this Sublease, the term “Letter of Credit” shall include the Suite 420 Letter of Credit and, if applicable, the Suite 450 Letter of Credit and shall be issued by a solvent and nationally recognized bank (a bank which accepts deposits, maintains accounts, has a local San Francisco Bay Area office which will negotiate a letter of credit in credit, and whose deposits are insured by the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars FDIC) reasonably acceptable to Sublandlord ($166,229.00such approved, issuing bank being referred to herein as the “Bank”). Said letter Subtenant shall pay all expenses, points and/or fees incurred by Subtenant in obtaining the Letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank Credit or by another financial institution located in Orange County and which is acceptable to Landlordany updates or replacements thereof. The letter Letter of credit Credit shall either: (i) be issued with a fixed expiration date of December 31“callable” at sight, 2005irrevocable and unconditional, or (ii) shall provide be maintained in effect, whether through renewal or extension, for automatic annual renewals through the period commencing on the date of this Sublease and continuing until the date (the “Letter of Credit Expiration Date”) that date which is no less than sixty (60) days after the Letter of Credit Expiration Date as the same may be extended, and Subtenant shall deliver a new Letter of the Term Credit or certificate of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty extension to Sublandlord at least thirty (2030) days prior to the then-scheduled expiration date of the letter Letter of creditCredit then held by Sublandlord, then Landlord without any action whatsoever on the part of Sublandlord, (iii) be fully assignable by Sublandlord, its successors and assigns, (iv) permit partial draws and multiple presentations and drawings, and (v) be otherwise subject to the International Standby Practices-ISP 98, International Chamber of Commerce Publication #590. Sublandlord, or its authorized representative, shall have the right to draw down an amount up to the full face amount of the Letter of Credit if any of the following shall have occurred or be applicable: (A) such amount is due to Sublandlord under the terms and conditions of this Sublease, and has not been paid within applicable notice and cure periods, or (B) Subtenant has filed a voluntary petition under the U. S. Bankruptcy Code or any state bankruptcy code (collectively, “Bankruptcy Code”), or (C) an involuntary petition has been filed against Subtenant under the Bankruptcy Code that is not dismissed within thirty (30) days, or (D) the Bank has notified Sublandlord that the Letter of Credit will not be renewed or extended through the Letter of Credit Expiration Date, and Subtenant has not provided a replacement Letter of Credit that satisfies the requirements of this Sublease at least thirty (30) days prior to such expiration, or (E) Subtenant is placed into receivership or conservatorship, or becomes subject to similar proceedings under Federal or State law, or (F) Subtenant executes an assignment for the benefit of creditors, or (G) if there is a material adverse change in the financial condition of the Bank, and Subtenant has failed to provide Sublandlord with a replacement letter of credit and credit, conforming in all respects to hold such the requirements of this Article 17, in the amount as part of the Security Deposit pursuant applicable Letter of Credit, within ten (10) days following Sublandlord’s written demand therefor (with no other notice or cure or grace period being applicable thereto, notwithstanding anything in this Sublease to Section 4.3 the contrary) (each of this Leasethe foregoing being an “Letter of Credit Draw Event”). Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord The Letter of Credit shall be entitled honored by the Bank regardless of whether Subtenant disputes Sublandlord’s right to draw upon said letter the Letter of credit by Credit. Subtenant hereby acknowledges and agrees that Sublandlord is entering into this Sublease in material reliance upon the issuance ability of Landlord’s sole written demand Sublandlord to draw upon the issuing financial institutionLetter of Credit upon the occurrence of any Letter of Credit Draw Event. Such In the event of any Letter of Credit Draw Event, Sublandlord may, but without obligation to do so, and without notice to Subtenant, draw shall be upon the Letter of Credit, in an part or in whole, in the amount necessary to cure the default in question and any such Letter of Credit Draw Event and/or to compensate Landlord Sublandlord for any and all damages of any kind or nature sustained or which Sublandlord reasonably estimates that it will sustain resulting from Subtenant’s breach or default of the Sublease or other Letter of Credit Draw Event and/or to compensate Sublandlord for any and all damages arising out of, or incurred therebyin connection with, as determined the termination of this Sublease, including, without limitation, those specifically identified in Section 1951.2 of the California Civil Code. The use, application or retention of the Letter of Credit, or any portion thereof, by Landlord in its sole and absolute discretionSublandlord shall not prevent Sublandlord from exercising any other right or remedy provided by this Sublease or by any applicable law, it being intended that Sublandlord shall not first be required to proceed against the Letter of Credit, and if such amount canLetter of Credit shall not operate as a limitation on any recovery to which Sublandlord may otherwise be readily determined by Landlordentitled. Subtenant agrees and acknowledges that (i) the Letter of Credit constitutes a separate and independent contract between Sublandlord and the Bank, then (ii) Subtenant is not a third party beneficiary of such contract, (iii) Subtenant has no property interest whatsoever in the full amount Letter of Credit or the proceeds thereof, and (iv) in the event Subtenant becomes a debtor under any chapter of the letter Bankruptcy Code, Subtenant is placed into receivership or conservatorship, and/or there is an event of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoinga receivership, while the amount of conservatorship or a bankruptcy filing by, or on behalf of, Subtenant, neither Subtenant, any such draw trustee, nor Subtenant’s bankruptcy estate shall be determined in Landlordhave any right to restrict or limit Sublandlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant claim and/or rights to the applicable provisions Letter of Article XIV Credit and/or the proceeds thereof by application of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result Section 502(b)(6) of the default, as a setoff for full U. S. Bankruptcy Code or partial compensation for the defaultotherwise. If any portion of the letter Letter of credit Credit is drawn after a default by Tenantso used or applied, Tenant shall then Subtenant shall, within five ten (510) business days after written following demand by Landlord therefor, restore the letter Letter of credit. Failure Credit to its original amount, and Subtenant’s failure to do so restore said letter of credit within said five (5) days shall be a default by Tenant under material breach of this LeaseSublease. Partial drawings upon said letter The provisions of credit this Section 17 shall be permitted. In the event that Tenant has not been in default under the Lease (beyond survive the expiration or earlier termination of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termthis Sublease.

Letter of Credit. In addition (a) At any time the Company may, at its option, provide for the delivery to the Security Deposit and Trustee of a Letter of Credit or Alternate Letter of Credit (hereafter collectively referred to as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (ia “Credit Instrument”) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before Company shall, in any event, cause to be delivered a Credit Instrument at least twenty (20) calendar days before the expiration date of any existing Letter of Credit, unless otherwise permitted by the Indenture. A Credit Instrument shall be an irrevocable letter of credit or other irrevocable credit facility (including, if applicable, a confirming letter of credit), issued by a Credit Provider, the terms of which shall be acceptable to the Trustee and shall otherwise comply with the requirements of the Indenture; provided, that the expiration date of such Credit Instrument shall be a date not earlier than one year from its date of issuance, subject to earlier termination upon payment of the Bonds in full or provision for such payment in accordance with Article X of the Indenture. On or prior to the date of the delivery of a Credit Instrument to the Trustee, the Company shall cause to be furnished to the Trustee (i) an opinion of Bond Counsel addressed to the Trustee stating to the effect that the delivery of such Credit Instrument to the Trustee is authorized under the Indenture and complies with the terms hereof and will not in and of itself adversely affect the Tax-exempt status of interest on the Bonds, (ii) an opinion of counsel to the Credit Provider issuing such Credit Instrument stating to the effect that such Credit Instrument is enforceable in accordance with its terms (except to the extent that the enforceability thereof may be limited by bankruptcy, reorganization or similar laws limiting the enforceability of creditors’ rights generally and except that no opinion need be expressed as to the availability of any discretionary equitable remedies), (iii) written evidence from the Rating Agency that the Bonds shall have a long-term rating of “A” (or equivalent) or higher or, if the Bonds only have a short-term rating, such short-term rating shall be in the highest short-term rating category (without regard to “+”s or “-”s) and (iv) if no Rating Agency is then rating the Bonds, an opinion of Bond Counsel addressed to the Trustee or an opinion of counsel to the Credit Provider addressed to the Trustee to the effect that payments under such Credit Instrument will not constitute a voidable preference under Section 547 of the United States Bankruptcy Code as then in effect if a petition in bankruptcy is filed by or against the Company, the Guarantor or the Issuer or an affiliate or a subsidiary of any of them. (b) The Company shall provide to the Trustee (with a copy to the Issuer) a written notice at least fifteen (15) calendar days prior to the then-scheduled expiration effective date of the letter any Alternate Letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit Credit (and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within no event later than thirty-five (535) calendar days after written demand by Landlord restore the letter of credit. Failure prior to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure periodexisting Letter of Credit) at any time during identifying the Term hereofAlternate Letter of Credit, if any, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions rating which will apply to the principal amount of Bonds after the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termeffective date.

Letter of Credit. In addition to Concurrently with the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit Tenant shall pay to Landlord a security deposit in the amount of One Million Forty-Four Thousand Four Hundred Sixty Six Thousand Two Hundred TwentyEighty-Nine Four and 98/100 Dollars ($166,229.001,044,484.98) and Landlord shall hold the same, throughout the Term of this Lease (including the Extended Term, if applicable), unless sooner returned to Tenant as provided in this Section 16.26, as security for the performance by Tenant of all obligations on the part of Tenant to be performed under this Lease. Said Such deposit shall be in the form of an irrevocable, unconditional, negotiable letter of credit shall be in form and with (the substance “Letter of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to LandlordCredit”). The letter Letter of credit Credit shall either: (i) be issued with by and drawn on a fixed expiration date bank reasonably approved by Landlord and at a minimum having a long term issuer credit rating from Standard and Poor’s Professional Rating Service of December 31A or a comparable rating from Xxxxx’x Professional Rating Service, 2005, or (ii) be substantially in the form attached hereto as Exhibit J, (iii) permit one or more draws thereunder to be made accompanied only by certification by Landlord or Landlord’s managing agent that pursuant to the terms of this Lease, Landlord is entitled to draw upon such Letter of Credit, (iv) permit transfers at any time without charge, (v) permit presentment in Boston, Massachusetts and (vi) provide that any notices to Landlord be sent to the notice address provided for Landlord in this Lease. Landlord hereby agrees that Silicon Valley Bank shall be an approved bank for purposes of this Section 16.26. If the credit rating for the issuer of such Letter of Credit falls below the standard set forth in (i) above or if the financial condition of such issuer changes in any other material adverse way or if any trustee, receiver or liquidator shall be appointed for the issuer, Landlord shall have the right to require that Tenant provide a substitute letter of credit that complies in all respects with the requirements of this Section, and Tenant’s failure to provide the same within thirty (30) days following Landlord’s written demand therefor shall entitle Landlord to immediately draw upon the Letter of Credit. Any such Letter of Credit shall be for a term of two (2) years (or for one (1) year if the issuer thereof regularly and customarily only issues letters of credit for a maximum term of one (1) year) and shall in either case provide for automatic annual renewals through that the date which is sixty (60) days after subsequent to the Expiration Date scheduled expiration of this Lease (as the same may be extended). Any failure or refusal of the Term issuer to honor the Letter of this Lease. In the event the letter Credit shall be at Tenant’s sole risk and shall not relieve Tenant of credit is issued its obligations hereunder with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior regard to the then-scheduled expiration date security deposit. Upon the occurrence of the letter any Event of creditDefault, then Landlord shall have the right from time to time without prejudice to any other remedy Landlord may have on account thereof, to draw the full amount on all or any portion of such letter deposit held as a Letter of credit Credit and to hold apply the proceeds of such amount Letter of Credit or any cash held as such deposit, or any part thereof, to Landlord’s damages arising from such Event of Default on the part of Tenant under the Security Deposit pursuant to Section 4.3 terms of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent If Landlord so applies all or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenantsuch deposit, Tenant shall within five seven (57) days after written demand by notice from Landlord either (a) amend the Letter of Credit or deliver an additional Letter of Credit which satisfies the requirements of this Section 16.26 in the amount so applied or retained such that Landlord shall have a Letter of Credit (or Letters of Credit) in the required security deposit amount on hand at all times during the Term or (b) deposit cash with Landlord in an amount sufficient to restore such deposit to the letter of creditfull amount stated in this Section 16.26. Failure While Landlord holds any cash deposit Landlord shall have no obligation to so restore said letter of credit within said five (5) days pay interest on the same and shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permittedhave the right to commingle the same with Landlord’s other funds. In the event that Tenant has not been of a transfer of Landlord’s interest in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of TenantOffice Area, Landlord shall authorize in writing consecutive reductions transfer the Letter of Credit or cash proceeds, as applicable, to the principal amount transferee and thereupon Landlord shall without any further agreement between the parties, be released by Tenant from all liability therefor. Neither the holder of a mortgage nor Landlord in a ground lease on property which includes the Premises shall ever be responsible to Tenant for the return or application of any such deposit, whether or not it succeeds to the position of Landlord hereunder, unless such deposit shall have been received in hand by such holder or ground Landlord. Tenant not then being in default and having performed all of its obligations under this Lease, including the payment of all Annual Fixed Rent, Landlord shall promptly return the deposit, or so much thereof as shall not have theretofore been applied in accordance with the terms of this Section 16.26, to Tenant on the expiration or earlier termination of the letter term of credit this Lease (as the same may have been extended) and surrender possession of the Premises by Tenant to Landlord in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon condition required in the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermLease at such time.

Letter of Credit. In addition to 15.01 Simultaneously with the Security Deposit execution and as security hereunderdelivery of this Lease, Tenant shall deliver to LandlordLandlord a clean, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in the amount Letter of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars Credit Amount ($166,229.00as defined in Article 1) in the form attached hereto as Exhibit L or otherwise satisfactory in form and content to Landlord and issued by an FDIC insured bank located in Boston reasonably satisfactory to Landlord in favor of Landlord. During the Term hereof, including any extensions thereof, or for any period that Tenant remains in possession of the premises following the expiration of the term, or for any period Tenant has obligations hereunder to Landlord that remain unsatisfied following the expiration of the term (as may be extended). Said , and for ninety (90) days after the latest to occur of the foregoing (i.e., the expiration of the term (as may be extended), the date on which Tenant vacates and yields up the premises, etc.), the letter of credit shall be in form held to ensure the full and with the substance timely performance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and Tenant’s obligations under this Lease; which is acceptable to Landlord. The letter of credit may be drawn upon by Landlord and applied from time to time against outstanding obligations of Tenant hereunder without notice or demand. Tenant shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event have no right to require Landlord to so draw and apply the letter of credit, nor shall Tenant be entitled to credit is issued with an annual renewal obligation and the same against rents or other sums payable hereunder. During the entire Term hereof, including any extension thereof, Tenant shall cause said letter of credit is not renewed by the issuing financial institution on or before twenty to be renewed, in identical form to that delivered herewith, no later than thirty (2030) days prior to the then-scheduled expiration date of expiration of same. Without limiting any other remedies of Landlord, in the event that Tenant fails to renew any letter of creditcredit given hereunder at least thirty (30) days prior to the date of expiration thereof, then Landlord shall have the right to draw down the entire amount of said letter of credit and hold such sums as a cash deposit. If and to the extent that Landlord makes such use of the letter of credit, or any part thereof, the sum so applied by Landlord (from cash or from a drawing on the letter of credit) shall be restored to the letter of credit (or by a new letter of credit equal to the difference) by Tenant forthwith upon notice from Landlord, and failure to so restore (within the grace period applicable to Base Rent hereunder) shall be a default hereunder giving rise to all of Landlord’s rights and remedies applicable to a default in the payment of rent. In the event of a change of circumstance relating to the bank issuing the letter of credit, or Landlord otherwise believes the financial conditions of the issuing bank has been degraded, Landlord reserves the right to require Tenant to replace the letter of credit from time to time with a substitute similar letter of credit issued by another bank satisfactory to Landlord. In addition, in the event of a termination based upon the default of Tenant under the Lease, or a rejection of the Lease pursuant to the provisions of the Federal Bankruptcy Code, Landlord shall have the right to draw upon the Letter of Credit (from time to time, if necessary) to cover the full amount of such letter of credit damages and other amounts due from Tenant to hold such amount as part Landlord under the Lease. Any amounts so drawn shall, at Landlord’s election, be applied first to any unpaid rent and other charges which were due prior to the filing of the Security Deposit pursuant petition for protection under the Federal Bankruptcy Code. Tenant hereby covenants and agrees not to Section 4.3 oppose, contest or otherwise interfere with any attempt by Landlord to draw down from said Letter of this LeaseCredit including, without limitation, by commencing an action seeking to enjoin or restrain Landlord from drawing upon said Letter of Credit. Upon Tenant also hereby expressly waives any default by Tenant, including specifically Tenant’s failure right or claim it may have to pay rent or seek such equitable relief. In addition to abide by whatever other rights and remedies it may have against Tenant if Tenant breaches its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodthis paragraph, Landlord Tenant hereby acknowledges that it shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question liable for any and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights which Landlord may have under this Lease or at law or in equity suffer as a result of any such breach. Upon request of Landlord or any (prospective) purchaser or mortgagee of the defaultBuilding, Tenant shall, at its expense, cooperate with Landlord in obtaining an amendment to or replacement of any Letter of Credit which Landlord is then holding so that the amended or new Letter of Credit reflects the name of the new owner of the Building or mortgagee, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termcase may be.

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently (a) Concurrently with Tenant’s its execution of this Lease, Tenant will obtain and deliver to Landlord an irrevocable stand-by irrevocable, clean, unconditional standby letter of credit in accordance with the terms and conditions of this Section 2417 (the “Letter of Credit”). The Letter of Credit will be in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Fifty Thousand Dollars ($166,229.00250,000), will be issued initially by Fleet Bank, or if Tenant wishes or is required to replace the initial Letter of Credit, by a bank that meets the criteria in Section 24.17(d). Said letter The Letter of credit shall be in form Credit will name the then-current Landlord (or, at Landlord’s request from time to time, one or more then-current lenders to Landlord) as the beneficiary thereof, will have an initial term of at least one (1) year, will renew automatically unless Landlord receives written notice from the issuer at least thirty (30) days prior to its expiration, and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is will expire no earlier than sixty (60) days after the Expiration Date expiration date of the Term of this Lease. In Tenant will renew or replace the event the letter Letter of credit is issued Credit in accordance with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty this Section 24.17 at least thirty (2030) days prior to the then-scheduled expiration date its expiration. The form and content of the letter Letter of credit, then Landlord shall Credit will be as set forth in this Section 24.17 and otherwise as may be acceptable to the beneficiary thereof. The beneficiary will have the right to draw under the full amount Letter of Credit on one or more occasions from time to time (either total or partial draws) and in accordance with the terms hereof simply upon presentation to the issuer of a sight draft executed by the beneficiary or its authorized representative requesting payment and without further condition or certification, and the issuer will pay upon presentation of such letter draft without deduction or offset of credit any type. The Letter of Credit will be assignable in whole but not in part, and at Landlord’s request from time to hold such amount as part time, it will be reissued in favor of a new beneficiary in accordance with the Security Deposit pursuant to Section 4.3 terms of this Lease. Upon any default by Tenant, including specifically Tenant’s failure . (b) If Tenant defaults or fails to pay rent or perform its Liabilities under this Section 24.17 or the rest of this Lease as and when required (including, without limitation, failing to abide by its obligations renew or replace the Letter of Credit as and when required), the beneficiary thereafter may, but will not be obligated to, draw under Sections 7.1 the Letter of Credit on one or more occasions and 15.3 below and Tenant’s failure hold or apply the proceeds thereof to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all amounts owed and/or damages incurred thereby, or resulting therefrom and/or in such other manner or order as determined by Landlord the beneficiary may determine in its sole and absolute discretion, and if such amount canthe beneficiary’s draw(s) under or failure to draw down all or any portion of the Letter of Credit in any particular instance will not be readily determined by deemed to be a waiver or election of any rights and remedies of any type of Landlord or the beneficiary, a limitation on Landlord’s or the beneficiary’s right to damages or the amount thereof, then the full amount a payment of the letter of credit can be drawn by Landlord pending determination of said amountliquidated damages or an accord or satisfaction. Notwithstanding the foregoing, while the amount beneficiary may not apply the proceeds of the Letter of Credit in amounts materially in excess of the damages actually or reasonably expected to be incurred by the beneficiary (but the parties specifically agree that the beneficiary’s rights to draw under and/or apply the proceeds of the Letter of Credit will not be subject to any such draw shall be determined in Landlord’s sole and absolute discretion as provided stays “caps” or limitations on damages in the foregoing, if the amount Bankruptcy Code or otherwise affected by an Event of any such draw(sBankruptcy). (c) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter Letter of credit Credit is drawn after a default by Tenanton, Tenant shall will within five ten (510) days after written demand by notice either: deposit cash with Landlord restore so that the letter combination of creditcash and the undrawn portion of the Letter of Credit equal the original amount of the Letter of Credit; or cause the Letter of Credit to be reinstated or reissued so that the amount thereof equals the original amount of the Letter of Credit. Failure to so restore said letter If the Letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant Credit has not been drawn on and Tenant is not in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not committed an act or omission that with the passage of time or the giving of notice (or both) would constitute a default, Tenant may at any time been more than five (5) days late more than once during its cost reduce the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal face amount of the letter Letter of credit in the amount of Thirty Three Credit to One Hundred Twenty-five Thousand Two Hundred Forty-Six Dollars ($33,246.00125,000) each upon if prior thereto: (i) Tenant has met the expiration following financial criteria for one full calendar year: revenue (excluding venture or other funding) of at least $73.8 Million; cost of goods sold not exceeding 29% of revenue; operating expenses not exceeding 38% of revenue; and operating income of at least $25 Million and at least 34% of revenue; and (ii) Tenant delivers to Landlord: financial statements prepared in accordance with GAAP and audited by an independent certified public accountant showing that these financial criteria have been met; and an unconditional written certification from such accountant and Tenant’s President or CFO certifying that these financial criteria have been met. (d) Tenant will promptly cause the Letter of Credit to be replaced by a Letter of Credit issued by another recognized United States money-center bank in good standing with a branch located in the Boston, Massachusetts metropolitan area of the twelfth United States that meets the financial criteria described below and is otherwise reasonably acceptable to the beneficiary: (12th)i) on demand by the beneficiary if the issuer ever fails to meet the financial criterion described below; or (ii) if Tenant wishes to replace the Letter of Credit with a Letter of Credit issued by another bank. The financial criteria referred to above are the issuer’s maintenance of credit quality ratings from Fitch, twenty-fourth (24th)Inc., thirty-sixth (36th), Xxxxx’x and forty-eighth (48th) months Standard & Poor’s at least equal to those enjoyed by the initial issuer of the TermLetter of Credit when the Letter of Credit was initially issued. Tenant will be responsible for documenting such compliance if required. The beneficiary will have the immediate right thereon and thereafter to draw under the Letter of Credit for all or any portion thereof if the Letter of Credit is not replaced as and when required by an issuer meeting the financial criterion referred to above. Tenant will be solely responsible for all costs in connection with any issuance, reissuance, reinstatement, assignment, modification, transfer or renewal of the Letter of Credit in accordance with this Section.

Letter of Credit. In addition Tenant shall, within twenty (20) business days after the date hereof, deliver to Landlord an irrevocable, unconditional letter of credit ("Letter of Credit") in favor of Landlord in the following amounts: Tenant's failure to provide the Letter of Credit within said twenty (20) business day period after the date hereof shall constitute an event of material default hereunder. The expiration date of the Letter of Credit shall be no earlier than the end of the fourth (4th) Lease Year of the Lease Term; provided, however, that such Letter of Credit may be of a duration shorter than said period, so long as Tenant replaces said Letter of Credit with a new Letter of Credit, on the same terms and conditions as the prior Letter of Credit, and in the applicable amount based on the foregoing schedule in this Section 47.0, at least one (1) month prior to the Security Deposit expiration of the prior Letter of Credit. If Tenant fails to replace a prior Letter of Credit within the period required herein, then Landlord shall be immediately authorized and entitled to demand and receive payment under said Letter of Credit, and to apply and hold the proceeds therefrom as an additional security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution deposit under the terms and conditions of Section 3.3 of this Lease. Said Letter of Credit must be acceptable to Landlord as to form, content, and issuing bank, and must not require any documentation in order to be valued upon and must contain an irrevocable standexplicit waiver by the issuing bank of any statutory or other right to delay or defer payment upon demand including, but not limited to, a waiver of such rights as are set forth in Article 5, Section 5-112(l)(a) and (b) of the Uniform Commercial Code. Said Letter of Credit must also provide that the issuing bank, upon any presentation of a draft for valuation thereon, shall honor such draft by letter promptly delivering the amount of credit the draft, by official bank or cashier's check, to Landlord or, at Landlord's sole option, by promptly wiring Federal Funds in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00)the draft into such account(s) as Landlord may specifically direct, in writing. Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to may draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw down upon said letter Letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be Credit in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been is in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to the payment of any payments of rent or other sums due to be paid to the Landlord under the this Lease, then upon and the written request of Tenantapplicable grace, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th)notice and cure period, twenty-fourth (24th)if any, thirty-sixth (36th), and forty-eighth (48th) months of the Termhas expired.

Letter of Credit. (a) In addition to the lieu of a cash Security Deposit and as security hereunderDeposit, Tenant shall may deliver to Landlord, concurrently with Tenant’s execution of on the date that Tenant executes and delivers this LeaseLease to Landlord, an irrevocable stand-Irrevocable Standby Letter of Credit (the “Letter of Credit”) which shall be (1) in the form attached hereto as Exhibit 6, (2) issued by letter a bank approved in writing by Landlord with an investment grade credit rating from Mxxxx’x (i.e., a rating of credit Baa3 or above), S&P (i.e., a rating of BBB- or above), or Fitch (i.e., a rating of BBB- or above) (an “Acceptable Bank”), (3) upon which presentment may be made in Boston, MA, Washington, DC, or elsewhere in the continental United States if presentation may be made by overnight courier (e.g., Federal Express), (4) in the amount set forth in Exhibit 1, and (5) for a term of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars at least one ($166,229.00)1) year, subject to automatic extension in accordance with the terms of the Letter of Credit. Said letter If the issuer of credit the Letter of Credit ceases to qualify as an Acceptable Bank or becomes subject to insolvency or receivership proceedings of any sort, Tenant shall be in form and with required to deliver a substitute Letter of Credit satisfying the substance conditions hereof (the “Substitute Letter of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Credit”) within fifteen (15) business days after written notice thereof from Landlord. The letter If the issuer of credit the Letter of Credit gives written notice of its election not to renew such Letter of Credit for any additional period, Tenant shall either: be required to deliver a Substitute Letter of Credit at least thirty (i30) be issued with days prior to the expiration of the term of such Letter of Credit. If Tenant fails to furnish such renewal or replacement by the applicable deadline set forth above, Landlord may draw upon such Letter of Credit and hold the proceeds thereof (the “Security Proceeds”) as a fixed expiration date cash Security Deposit pursuant to the terms of December 31Section 7.1. Txxxxx agrees that it shall maintain the Letter of Credit, 2005in the full amount required hereunder, or (ii) shall provide for automatic annual renewals through that in effect until a date which is at least sixty (60) days after the Expiration Date of the Term of this Lease. Tenant’s failure to maintain or replace the Letter of Credit as required hereunder shall be treated as a failure to pay rent for purposes of Landlord’s remedies. (b) If Tenant is in default of its obligations under this Lease that continues beyond the expiration of any applicable notice grace or cure period, then Landlord shall have the right, at any time after such event, without giving any further notice to Tenant, to draw down from the Letter of Credit (or Substitute Letter of Credit or Additional Letter of Credit, as defined below, as the case may be) (i) the amount necessary to cure such default or (ii) if such default cannot reasonably be cured by the expenditure of money, the amount which, in Lxxxxxxx’s opinion, is necessary to satisfy Tenant’s liability in account thereof. In the event of any such draw by Landlord, Tenant shall, within fifteen (15) business days of written demand therefor, deliver to Landlord an additional Letter of Credit satisfying the letter foregoing conditions (the “Additional Letter of credit is issued with Credit”), except that the amount of such Additional Letter of Credit shall be the amount of such draw. Tenant may, in lieu of providing an annual renewal obligation and the letter Additional Letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior Credit, deliver to Landlord an amendment to the then-scheduled expiration date existing Letter of Credit. In addition, in the event of a termination based upon the default of Tenant under this Lease, or a rejection of this Lease pursuant to the provisions of the letter of creditFederal Bankruptcy Code, then Landlord shall have the right to draw upon the Letter of Credit (from time to time, if necessary) to cover the full amount of such letter of credit damages and other amounts due from Tenant to hold such amount as part of the Security Deposit pursuant to Section 4.3 of Landlord under this Lease. Upon Any amounts so drawn shall, at Lxxxxxxx’s election, be applied first to any default unpaid rent and other charges which were due prior to the filing of the petition for protection under the Federal Bankruptcy Code. Tenant hereby covenants and agrees not to oppose, contest or otherwise interfere with any attempt by TenantLandlord to draw down from said Letter of Credit including, including specifically Tenant’s failure without limitation, by commencing an action seeking to pay rent enjoin or restrain Landlord from drawing upon said Letter of Credit. Tenant also hereby expressly waives any right or claim it may have to abide by seek such equitable relief. In addition to whatever other rights and remedies Landlord may have against Tenant if Tenant breaches its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodthis paragraph, Landlord Tenant hereby acknowledges that it shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question liable for any and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights which Landlord may have under this Lease or at law or in equity suffer as a result of any such breach. (c) Upon request of Lxxxxxxx, Tenant shall, at its expense, cooperate with Landlord in obtaining an amendment to or replacement of any Letter of Credit which Landlord is then holding so that the default, as a setoff for full amended or partial compensation for new Letter of Credit reflects the default. If name of any portion new owner of the letter of credit is drawn after a default by Tenant, Tenant shall within five Building. (5d) days after written demand by Landlord restore To the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event extent that Tenant Lxxxxxxx has not been in default under previously drawn upon any Letter of Credit, Substitute Letter of Credit, Additional Letter of Credit or Security Proceeds (collectively, the Lease (beyond the expiration of any applicable cure period“Collateral” ) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenantheld by Landlord, Landlord shall authorize in writing consecutive reductions return such Collateral to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon Tenant on the expiration of the twelfth Term, less any amounts due from Tenant hereunder. (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48the) months In no event shall the proceeds of the Termany Letter of Credit be deemed to be a prepayment of rent or a measure of liquidated damages.

Letter of Credit. In addition to the Security Deposit and as security hereunderUpon execution of this Lease, Tenant shall deliver to LandlordLandlord a clean, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit (the “Letter of Credit”) established in Landlord’s (and its successors’ and assigns’) favor in the amount Letter of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars Credit Amount, issued by a federally insured banking or lending institution ($166,229.00). Said letter of credit shall be i.e., insured by the FDIC) with a retail banking branch located within the continental United States reasonably acceptable to Landlord and in other form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is reasonably acceptable to Landlord. The Letter of Credit shall specifically provide for partial draws, shall be self-renewing annually as an “Evergreen” letter of credit credit, without amendment, for additional one-year periods, shall either: have a term that is self-renewing until sixty (i60) days after the expiration of the Term of the Lease and shall by its terms be issued with transferable by the beneficiary thereunder for a fixed expiration date transfer fee not to exceed $250.00 payable by Tenant. If Tenant fails to make any payment of December 31, 2005rent or other charges due to Landlord under the terms of the Lease, or otherwise defaults hereunder, beyond any applicable notice and cure period, Landlord, at Landlord’s option, may make a demand for payment under the Letter of Credit in an amount equal to the amounts then due and owing to Landlord under the Lease. In the event that Landlord draws upon the Letter of Credit, Tenant shall present to Landlord a replacement Letter of Credit in the full Letter of Credit Amount satisfying all of the terms and conditions of this Section within ten (ii10) days after receipt of notice from Landlord of such draw. Tenant’s failure to do so within such 10-day period will constitute a default hereunder (Tenant hereby waiving any additional notice and grace or cure period), and upon such default Landlord shall provide for automatic annual renewals through be entitled to immediately exercise all rights and remedies available to it hereunder, at law or in equity. In the event that the Letter of Credit is terminated by the issuer thereof prior to the date which that is sixty (60) days after the Expiration Date of the Term expiration date of this Lease. In , as set forth above, and Tenant has not presented to Landlord a replacement Letter of Credit which complies with the event terms and conditions of the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution Lease on or before twenty thirty (2030) days prior to the then-scheduled expiration date of the letter any such Letter of creditCredit then held by Landlord, then Landlord Tenant shall be deemed in default hereunder and Landlord, in addition to all other rights and remedies provided for hereunder, shall have the right to draw upon the full Letter of Credit then held by Landlord and any such amount paid to Landlord by the issuer of the Letter of Credit shall be held in a segregated account by Landlord as security for the performance of Tenant’s obligations hereunder. Any interest earned on such letter amounts shall be the property of credit Landlord. Landlord’s election to draw under the Letter of Credit and to hold such amount as part the proceeds of the Security Deposit pursuant drawing under the Letter of Credit in a segregated account shall not be deemed a cure of any default by Tenant hereunder and shall not relieve Tenant from its obligation to Section 4.3 present to Landlord a replacement Letter of Credit which complies with the terms and conditions of this Lease. Upon Tenant acknowledges that any default proceeds of a draw made under the Letter of Credit and thereafter held in a segregated account by Tenant, including specifically Tenant’s failure to pay rent or to abide Landlord may be used by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure Landlord to cure or satisfy any obligation of Tenant hereunder as if such proceeds were instead proceeds of a draw made under a Letter of Credit that remained outstanding and in full force and effect at the same within time such amounts are applied by Landlord to cure or satisfy any applicable cure periodsuch obligation of Tenant. Tenant hereby affirmatively disclaims any interest Tenant has, may have, claims to have, or may claim to have in any proceeds drawn by Landlord under the Letter of Credit and held in accordance with the terms hereof. Without limiting the generality of the foregoing, Tenant expressly acknowledges and agrees that at the end of the Term of the Lease (whether by expiration or earlier termination hereof), and if Tenant is not then in default under this Lease, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand return to the issuing financial institution. Such draw shall be issuer of the Letter of Credit or its successor (or as such issuer may direct in an amount necessary to cure writing) any remaining and unapplied proceeds of any prior draws made under the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretionLetter of Credit, and if Tenant shall have no rights, residual or otherwise, in or to such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amountproceeds. Notwithstanding In addition to the foregoing, while Landlord will have the amount right to require Tenant to have a new Letter of any Credit issued in accordance with the above requirements from a different Issuer if either the original Issuer is placed on an FDIC “watch list”, if the FDIC or similar state or federal banking regulatory agency is appointed as receiver or conservator for such draw shall be determined Issuer or if Landlord analyzes such Issuer’s capitalization, asset quality, earnings, and/or liquidity and in Landlord’s sole and absolute discretion discretion, disapproves of such Issuer’s financial wherewithal and ability to remain as provided the issuer of the Letter of Credit. Such new Letter of Credit must comply with the foregoing requirements and must be issued within thirty (30) days of Landlord’s demand therefor. Provided Tenant is not then in the foregoing, if the amount default (regardless of any such draw(snotice and cure periods) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant and has not been in default under the this Lease (beyond the expiration of any applicable notice and cure periodperiods during the prior twelve (12) at any time months, the Letter of Credit Amount shall reduce during the Term hereofof this Lease on the first date of the respective Lease Year as set forth below: First day of the 2nd Lease Year of the Term $ 13,148.44 $ 52,593.76 First day of the 3rd Lease Year of the Term $ 13,148.44 $ 39,445.32 First day of the 4th Lease Year of the Term $ 13,148.44 $ 26,296.88 First day of the 5th Lease Year of the Term $ 13,148.44 $ 13,148.44 Should Tenant be in default (regardless of any notice and cure periods) as of the specified reduction date, and provided further or if Tenant otherwise has been in default as specified above beyond any applicable notice and/or cure periods, no reduction shall occur as of such applicable date. The Letter of Credit shall specifically provide that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period Letter of Credit is subject to reduction in accordance with respect to any payments the terms of rent due under the Lease. If Tenant is then or has been in default and the Letter of Credit balance is not or was not reduced, then upon at the written request first date of Tenantthe next scheduled reduction Lease Year, Landlord shall authorize in writing consecutive reductions the Letter of Credit Amount will only be reduced by the next scheduled reduction amount and will not skip to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termotherwise applicable Lease Year.

Letter of Credit. In addition to At Subtenant’s option, upon execution of this Sublease, it may post the Security Deposit and as security hereunderin the form of an unconditional, Tenant shall deliver to Landlordclean, concurrently with Tenant’s execution of this Leaseirrevocable, an irrevocable stand-by standby letter of credit (the "Letter of Credit”), payable on sight with the bearer’s draft in the initial amount of One Hundred Sixty Six Ninety Five Thousand Two Hundred Twenty-Nine Dollars ($166,229.0095,000,00) (the “Initial Amount”) issued by and drawn on an institution acceptable to Sublandlord (the “Issuing Bank”). Said letter The Letter of credit Credit shall permit partial drawings and shall state that it shall be payable against sight drafts presented by Sublandlord, accompanied by Sublandlord’s sworn statement that a default by Subtenant under this Sublease exists and is continuing beyond the applicable cure period under this Sublease (including, without limitation, the Subtenant becoming insolvent as set forth in Section 16.1(h) of the Master Lease), and that said drawing is in accordance with the terms and conditions of this Sublease. No other document or certification from Sublandlord shall be required to negotiate the Letter of Credit. Sublandlord may designate any bank as Sublandlord’s advising bank for collection purposes and any sight drafts for the collection of the Letter of Credit may be presented by the advising bank on Sublandlord’s behalf. The Letter of Credit shall be for an initial term of at least one (1) year and shall be acceptable to Sublandlord, in its reasonable discretion, in both form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlordsubstance. The letter Letter of credit Credit shall either: be automatically renewed, without amendment (iexcept as hereinafter provided), for continuing consecutive one (1) be issued with a fixed expiration date of December 31year (or longer) periods unless, 2005, or at least thirty (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (2030) days prior to the then-scheduled expiration any such date of expiration, the letter issuer gives written notice to Sublandlord that the Letter of creditCredit will not be renewed, then Landlord in which case Sublandlord shall have the right be entitled to draw the full amount of such letter the Letter of credit and to hold such amount as part Credit. The Letter of Credit shall not expire until at least the Security Deposit pursuant to Section 4.3 date which is thirty (30) days after the scheduled expiration date or earlier termination of this LeaseSublease. Upon any a default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure Subtenant beyond the same within any applicable cure periodperiod under this Sublease, Landlord Sublandlord shall be entitled to draw upon said letter against the Letter of credit by Credit in the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter delinquent Rent or delinquent amount, expense, loss or damage that Sublandlord may suffer because of credit can be drawn by Landlord pending determination of said amountSubtenant’s default. Notwithstanding the foregoing, while the amount of any such draw shall be determined in LandlordUpon Subtenant’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default insolvency (as determined pursuant to defined in Section 16.1(h) of the applicable provisions of Article XIV of this Master Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw Sublandlord shall be without waiver entitled to draw against the entire amount of the Letter of Credit and any excess amounts shall be held by Sublandlord as collateral for Sublease obligations. Sublandlord shall not be required to exhaust its remedies against Subtenant before having recourse to the Letter of Credit or to any rights Landlord may have under this Lease other form of collateral held by Sublandlord or to any other remedy available to Sublandlord at law or in equity equity. The beneficiary designation in the Letter of Credit shall include Sublandlord and Sublandlord’s “successors and/or assigns as a result their interests may appear” and the Letter of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days Credit shall be a default by Tenant under this Lease. Partial drawings upon said letter assignable and shall include the Issuing Bank’s acknowledgment and agreement that the Letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermCredit is assignable.

Letter of Credit. In addition to the Security Deposit and as security hereunderrequired deposit, the Tenant shall deliver cause to be put in place within five (5) business days following written notice from Landlord that construction of the improvements shown on Exhibit C and Exhibit D is ready to commence and shall remain continuously in place until the fifth anniversary of the Commencement Date, unless otherwise provided herein or agreed by the Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by a letter of credit issued by a Bank in the area that is acceptable to the Landlord in the amount of One Four Hundred Sixty Six Nine Thousand Two Five Hundred Twenty-Nine Dollars ($166,229.00469,500), against which the Landlord may draw upon the occurrence of an Event of Default, as defined in Section 13.1, by Tenant under this Lease (the “Letter of Credit”). Said letter Landlord agrees that the Letter of credit Credit may be issued and renewed on an annual basis; provided that in the event Tenant fails to provide Landlord with a renewal Letter of Credit within ten (10) days prior to the termination of any then existing Letter of Credit, an Event of Default as defined in Section 13.1 shall be deemed to have occurred. The Letter of Credit shall be provided in a satisfactory form to the Landlord and be governed by the “Uniform Customs and Practices for Commercial Documentary Credits” promulgated by the XIII Congress of the International Chamber of Commerce (International Chamber of Commerce Brochure No. 500, 1993 revision) and the provisions of the Uniform Commercial Code-Letters of Credit—Title 8.5 of the Code of Virginia, 1950, as amended. The Landlord agrees that so long as the Tenant is in good standing with the substance Lease, the amount of Exhibit F attached heretothe Letter of Credit shall automatically be reduced at each anniversary of the Commencement Date by the amount of Ninety Two Thousand One Hundred Dollars ($92,100), provided the Letter of Credit shall automatically terminate on the fifth anniversary of the Commencement Date. 4. UTILITIES Landlord shall be responsible for providing water, sewer, electricity and natural gas to the Premises and shall promptly pay all costs and expenses associated therewith. Tenant shall be responsible for obtaining, and issued paying for directly, telephone, internet and all other utilities and services desired by Silicon Valley Bank or the Tenant in connection with the Premises not provided by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of Landlord under this Lease. In the event that any of the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed utilities provided by Landlord are interrupted or stopped by the issuing financial institution on action or before twenty (20) days prior to the then-scheduled expiration date inaction of the letter of creditLandlord, then its employees, agents or contractors, Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by shall, upon notice from Tenant, including specifically Tenant’s failure immediately notify the affected utility company and use its best efforts to pay rent or cause repairs to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permittedcommenced. In the event that there is a utility interruption or stoppage for more than one (1) business day, the Base Rent due hereunder shall be abated until such interruption or stoppage is corrected. In addition to the Base Rent, the Tenant has not been in default under shall pay Tenant’s Proportionate Share of the Lease utilities provided by Landlord (beyond the expiration “Utility Fee”). For the first six months following the Commencement Date, Tenant shall pay $3,390.83 per month based on an annual Utility Fee equal to $1.30 per square foot. At the end of any applicable cure period) at any time the six month period following the Commencement Date (the “Reallocation Date”), the Landlord shall determine the actual amount of Tenant’s Proportionate Share of the water, sewer, electric, and natural gas utility usage provided by Landlord during the Term hereofsix month period and shall provide Tenant with a copy of readings and costs to Tenant. In the event the actual amount of Tenant’s Proportionate Share of the water, sewer, electric, and natural gas utility usage provided further that by Landlord during the six month period exceeds the $1.30 per square foot amount, Tenant has not at any time been more than five shall pay Landlord the difference within thirty (530) days late more than once following Tenant’s receipt of evidence of the difference. In the event the actual amount of Tenant’s Proportionate Share of the water, sewer, electric, and natural gas utility usage provided by Landlord during the applicable previous twelve (12)-month six month period with respect to any payments of rent due under following the Lease, then upon Commencement Date is less than the written request of Tenantannual $1.30 per square foot amount, Landlord shall authorize reimburse Tenant the difference within thirty (30) days following Landlord’s determination that the amount is less. For the twelve (12) month period following the Reallocation Date, Tenant shall pay a Utility Fee based on the monthly average during the preceding six month period. At the end of the twelve (12) month period, Tenant shall pay to Landlord any increase in writing consecutive reductions to the principal actual amount of Tenant’s Proportionate Share of the letter of credit water, sewer, electric, and natural gas utility usage provided by Landlord during the preceding twelve (12) month period or Landlord shall reimburse Tenant the decrease in the actual amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration Tenant’s Proportionate Share of the twelfth (12th)water, twenty-fourth (24th)sewer, thirty-sixth (36th)electric, and forty-eighth natural gas utility usage provided by Landlord during the preceding twelve (48th12) months month period. For each twelve month (12) month period thereafter, Tenant shall pay a monthly Utility Fee based on the actual amount of Tenant’s Proportionate Share of the Termwater, sewer, electric, and natural gas utility usage provided by Landlord during the preceding twelve (12) month period. At the end of each period, Landlord shall determine the actual amount of Tenant’s Proportionate Share of the water, sewer, electric, and natural gas utility usage provided by Landlord during the preceding twelve (12) month period, and either Tenant shall pay to Landlord any increase in the actual amount of Tenant’s Proportionate Share of the water, sewer, electric, and natural gas utility usage provided by Landlord during the preceding twelve (12) month period or Landlord shall reimburse Tenant the decrease in the actual amount of Tenant’s Proportionate Share of the water, sewer, electric, and natural gas utility usage provided by Landlord during the preceding twelve (12) month period. It is acknowledged and agreed by Landlord that Tenant shall not share in the cost and expense of the water, sewer, electric and natural gas utility usage which is separately metered to any other tenant in the Building.

Letter of Credit. In addition to (a) It is agreed that Subtenant will provide Sublandlord at the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s time of the execution of this LeaseSublease, an unconditional, irrevocable stand-by letter of credit credit, in the amount of One Six Hundred Sixty Six Thousand Two Hundred Twenty-Nine and 00/100 Dollars ($166,229.00600,000.00) (the “Letter of Credit”). Said Subtenant shall be responsible, at its sole cost, for paying any and all letter of credit or other fees due to the issuer of the Letter of Credit. Such Letter of Credit shall be in form and with the substance of Exhibit F attached hereto, and issued provided by Silicon Valley Bank or by another financial institution located in Orange County and which a bank that is reasonably acceptable to Landlord. The letter Sublandlord, shall permit partial draws, shall be assignable by Sublandlord (without any cost to Sublandlord) and shall be for an initial term of credit shall either: one year and be automatically renewable (ii.e. “Evergreen”) be issued with a fixed expiration date for successive one year periods (unless Sublandlord receives notice of December 31, 2005, or non-renewal at least ten (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (2010) days prior to the then-scheduled expiration date of the letter Letter of creditCredit), then Landlord so that it remains outstanding for as long as the Sublease is in effect, and shall have otherwise be in a form that is reasonably acceptable to Sublandlord. The Letter of Credit must be able to be drawn upon in Boston, Massachusetts or elsewhere if approved by Sublandlord. In the right to draw the full amount event of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by TenantSubtenant under this Sublease, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord Sublandlord shall be entitled to draw upon said letter the Letter of credit by the issuance of Landlord’s sole written demand Credit to the issuing financial institutionextent of, and to reimburse Sublandlord for, any and all damages owed to Sublandlord by Subtenant as a result of such default. Such If at any time the Letter of Credit is due to expire or Sublandlord receives notice that it will expire and Sublandlord has not received written evidence of the renewal thereof at least ten (10) days before such expiration, Sublandlord may draw upon the Letter of Credit for the full amount thereof in which event the proceeds shall become a cash security deposit subject to the terms of this Paragraph 17. (b) In the event that Subtenant shall fully and faithfully comply with all of the terms, provisions, covenants and conditions of this Lease, the Letter of Credit (or cash deposit, if drawn), except as same may have been applied by Sublandlord in accordance with this Sublease, shall be returned to Subtenant within thirty (30) days after the Termination Date or such earlier termination date of this Sublease and after Subtenant has delivered entire possession of the Subleased Premises to Sublandlord in an amount necessary to cure accordance with all of the default terms and provisions of this Sublease. (c) Subtenant agrees that in question and to compensate Landlord for all damages incurred therebythe event Sublandlord draws upon the Letter of Credit in accordance with the provisions of this Sublease, as determined by Landlord Subtenant will immediately upon demand of Sublandlord replace the drawn upon Letter of Credit with a new Letter of Credit in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter drawn upon Letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoingCredit, while or reimburse or pay Sublandlord for the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if so applied so that the amount constituting the Letter of any such draw(s) Credit during the term of this Sublease shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant always be equal to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal required amount of the letter Letter of credit in Credit. (d) Subtenant further agrees that it will not assign or encumber or attempt to assign or encumber the amount moneys constituting the Letter of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th)Credit, and forty-eighth (48th) months of the Termthat neither Sublandlord nor its successors or assigns shall be bound by any such assignment, encumbrance or attempted assignment or encumbrance.

Letter of Credit. (a) In addition to the lieu of a cash Security Deposit and as security hereunderDeposit, Tenant shall may deliver to Landlord, concurrently with Tenant’s execution of on the date that Tenant executes and delivers this LeaseLease to Landlord, an irrevocable stand-Irrevocable Standby Letter of Credit (the “Letter of Credit”) which shall be (1) in the form attached hereto as Exhibit 6 (with such changes as Landlord may from time to time reasonably request), (2) issued by letter a bank approved in writing by Landlord with an investment grade credit rating from Xxxxx’x (i.e., a rating of credit Baa3 or above), S&P (i.e., a rating of BBB- or above), or Fitch (i.e., a rating of BBB- or above) (an “Acceptable Bank”), (3) upon which presentment may be made in Boston, MA, Washington, DC, or elsewhere in the continental United States if presentation may be made by overnight courier (e.g., Federal Express), (4) in the amount set forth in Exhibit 1, and (5) for a term of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars at least one ($166,229.00)1) year, subject to automatic extension in accordance with the terms of the Letter of Credit. Said letter If the issuer of credit the Letter of Credit ceases to qualify as an Acceptable Bank or becomes subject to insolvency or receivership proceedings of any sort, Tenant shall be in form and with required to deliver a substitute Letter of Credit satisfying the substance conditions hereof (the “Substitute Letter of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Credit”) within fifteen (15) business days after notice thereof from Landlord. The letter If the issuer of credit the Letter of Credit gives notice of its election not to renew such Letter of Credit for any additional period, Tenant shall either: be required to deliver a Substitute Letter of Credit at least thirty (i30) be issued with days prior to the expiration of the term of such Letter of Credit. If Tenant fails to furnish such renewal or replacement by the applicable deadline set forth above, Landlord may draw upon 1. Xxxxxx agrees that it shall maintain the Letter of Credit, in the full amount required hereunder, in effect until a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is at least sixty (60) days after the Expiration Date of the Term of this Lease. Tenant’s failure to maintain or replace the Letter of Credit as required hereunder shall be treated as a failure to pay rent for purposes of Landlord’s remedies. (b) If Tenant is in default of its obligations under this Lease, then Landlord shall have the right, at any time after such event, without giving any further notice to Tenant, to draw down from the Letter of Credit (or Substitute Letter of Credit or Additional Letter of Credit, as defined below, as the case may be) (i) the amount necessary to cure such default or (ii) if such default cannot reasonably be cured by the expenditure of money, the amount which, in Landlord’s opinion, is necessary to satisfy Tenant’s liability in account thereof. In the event of any such draw by Landlord, Tenant shall, within fifteen (15) business days of written demand therefor, deliver to Landlord an additional Letter of Credit satisfying the letter foregoing conditions (the “Additional Letter of credit is issued with an annual renewal obligation and Credit”), except that the letter amount of credit is not renewed by such Additional Letter of Credit shall be the issuing financial institution on amount of such draw. In addition, in the event of a termination based upon the default of Tenant under this Lease, or before twenty (20) days prior a rejection of this Lease pursuant to the then-scheduled expiration date provisions of the letter of creditFederal Bankruptcy Code, then Landlord shall have the right to draw upon the Letter of Credit (from time to time, if necessary) to cover the full amount of such letter of credit damages and other amounts due from Tenant to hold such amount as part of the Security Deposit pursuant to Section 4.3 of Landlord under this Lease. Upon Any amounts so drawn shall, at Xxxxxxxx’s election, be applied first to any default unpaid rent and other charges which were due prior to the filing of the petition for protection under the Federal Bankruptcy Code. Tenant hereby covenants and agrees not to oppose, contest or otherwise interfere with any attempt by TenantLandlord to draw down from said Letter of Credit including, including specifically Tenant’s failure without limitation, by commencing an action seeking to pay rent enjoin or restrain Landlord from drawing upon said Letter of Credit. Tenant also hereby expressly waives any right or claim it may have to abide by seek such equitable relief. In addition to whatever other rights and remedies Landlord may have against Tenant if Tenant breaches its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodthis paragraph, Landlord Tenant hereby acknowledges that it shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question liable for any and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights which Landlord may have under this Lease or at law or in equity suffer as a result of any such breach. (c) Upon request of Xxxxxxxx, Tenant shall, at its expense, cooperate with Landlord in obtaining an amendment to or replacement of any Letter of Credit which Landlord is then holding so that the default, as a setoff for full amended or partial compensation for new Letter of Credit reflects the default. If name of any portion new owner of the letter of credit is drawn after a default by Tenant, Tenant shall within five Building. (5d) days after written demand by Landlord restore To the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event extent that Tenant Xxxxxxxx has not been in default under previously drawn upon any Letter of Credit, Substitute Letter of Credit, Additional Letter of Credit or Security Proceeds (collectively, the Lease (beyond the expiration of any applicable cure period“Collateral”) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenantheld by Landlord, Landlord shall authorize in writing consecutive reductions return such Collateral to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon Tenant on the expiration of the twelfth Term, less any amounts due from Tenant hereunder. (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48the) months In no event shall the proceeds of the Termany Letter of Credit be deemed to be a prepayment of rent or a measure of liquidated damages.

Letter of Credit. In addition to Concurrently upon Tenant’s execution of the Security Deposit and as security hereunderLease, Tenant shall deliver to Landlord, concurrently with Tenant’s execution as additional protection for Landlord to assure the full and faithful performance by Tenant of this all of its obligations under the Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under the Lease, an irrevocable stand-by and unconditional negotiable letter of credit (the “Letter of Credit”), in the form attached hereto as Exhibit J-1 and containing the terms required herein, payable in Maricopa County, Arizona, running in favor of Landlord issued by a solvent nationally recognized bank with a long term rating of BBB or higher (as rated by Xxxxx’x Investors Service or Standard & Poor’s), and under the supervision of the Superintendent of Banks of the State of Arizone, or a national banking association, in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars set forth in the Basic Lease Information ($166,229.00“LC Amount”). Said letter The Letter of credit Credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31“callable” at sight, 2005irrevocable and unconditional, or (ii) shall provide subject to the terms of this Exhibit J, maintained in effect, whether through renewal or extension, for automatic annual renewals through that the entire period from the date of execution of the Lease and continuing until the date (the “LC Expiration Date”) which is sixty one hundred twenty (60120) days after the Expiration Date expiration of the Term initial Lease Term, and Tenant shall deliver a new Letter of this Lease. In the event the letter Credit or certificate of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty extension to Landlord at least thirty (2030) days prior to the then-scheduled expiration date of the letter Letter of creditCredit then held by Landlord, without any action whatsoever on the part of Landlord, (iii) subject to the International Standby Practices 1998, International Chamber of Commerce Publication No. 590, (iv) fully assignable by Landlord, and (v) permit partial draws. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same (the “Bank”)) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (A) Landlord, or its then Landlord managing agent, shall have the right to draw down an amount up to the full face amount of such letter the Letter of credit and Credit upon the presentation to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance Bank of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in (or Landlord’s sole and absolute discretion as provided in the foregoing, if the amount then managing agent’s) written statements that (1) an Event of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default Default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default occurred under the Lease (beyond and such amount is due to Landlord under the expiration terms and conditions of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, (2) Tenant has filed a voluntary petition under the Federal Bankruptcy Code or (3) an involuntary petition has been filed against Tenant under the Federal Bankruptcy Code, it being understood that if Landlord or its managing agent is a limited liability company, corporation, partnership or other entity, then upon such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); and (B) the written request Letter of Tenant, Landlord shall authorize in writing consecutive reductions Credit will be honored by the Bank without inquiry as to the principal amount accuracy thereof and regardless of whether the letter Tenant disputes the content of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termsuch statement.

Letter of Credit. In addition to At any time during the Security Deposit and as security hereunderTerm, Tenant shall have the right to deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by Landlord a letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars the Security Deposit, to be held by Landlord as security for the performance by Tenant of all of the obligations to be performed by it under this Lease. In such event, Landlord shall refund the cash Security Deposit and all accrued interest thereon to Tenant within fifteen ($166,229.00). Said 15) days after receipt of such letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlordcredit. The letter of credit (and each replacement or renewal thereof) shall either: (i) be issued with a fixed expiration date of December 31irrevocable, 2005, or (ii) shall provide be issued by NationsBank, N.A. or another national bank having an office in Washington, D.C. or Fairfax County, Virginia, which has net assets of $50,000,000 or more, (iii) be for automatic annual renewals through that date which is sixty (60) days a term of not less than 12 months after the Expiration Date date of issuance, and (iv) authorize Landlord to draw thereon by a sight draft delivered to the Term issuing bank accompanied by an affidavit of this Lease. In the event the a general partner, or executive officer, of Landlord that an Event of Default has occurred and is continuing or that Tenant has failed to deliver a replacement letter of credit is issued with an annual renewal obligation and within the letter of credit is not renewed time required by the issuing financial institution this subsection. Tenant shall, on or before twenty (20) days prior to the then-scheduled 30th day before the expiration date of the letter of credit, credit then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined being held by Landlord in its sole and absolute discretionunder this subsection, and if such amount cannot be readily determined by Landlord, then the full amount deliver to Landlord an extension or renewal of the letter of credit can be drawn for a period of not less than 12 months. Tenant shall extend or renew the letter of credit, or any extension or renewal thereof, for successive periods of at least 12 months each throughout the Term. Upon the occurrence of an Event of Default or the Tenant's failure to deliver a replacement letter of credit within the time required by this subsection, Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant authorized to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of on the letter of credit is drawn after a default then being held by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of creditit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to receive, hold and apply the principal amount proceeds of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon same manner and on the expiration same terms as the Security Deposit. All references in this Lease to the "Security Deposit" shall be deemed to include the proceeds of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months letter of the Termcredit.

Letter of Credit. In addition to the Security Deposit event of an Approval, Sections 18A through 18E will be valid and as security hereunderenforceable. In the event of a Non Approval, Tenant Sections 18C through 18E shall deliver to Landlordbe deemed null and void and only Sections 18A and 18B will be valid and enforceable. As partial consideration for Gavilon entering into this Agreement and the other Transaction Agreements, concurrently with TenantProducer’s execution of this Leaseparent company, Advanced BioEnergy, LLC, a Delaware limited liability company, shall post an irrevocable standand non-by transferable standby letter of credit for the benefit of Gavilon in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars $2,500,000 ($166,229.00“LOC Amount”), all in a form as agreed upon by Gavilon (the “ABE LOC”). Said letter of credit The ABE LOC shall include, but not be limited to, the following terms: A. In the event that the lease term for the individual Cars as set forth on Exhibit A are not hereafter extended or otherwise amended, the LOC Amount shall be decreased to (i) $2,000,000 on July 1, 2017 and (ii) $1,500,000 on July 1, 2018. There shall be no requirement to replace or renew the ABE LOC after it has been drawn upon. Any reference to the “LOC Amount” shall refer to the lesser amounts as set forth herein after the applicable dates referenced unless the lease term for the individual Cars as set forth on Exhibit A are hereafter extended or otherwise amended, in form and with which case the substance of Exhibit F attached heretooriginal LOC Amount shall remain in place unless the Parties otherwise agree. B. Geneva State Bank, and issued by Silicon Valley Bank or by another some other financial institution located in Orange County and which is deemed acceptable to LandlordGavilon (“Lender”), shall allow Gavilon to draw upon the ABE LOC in the full LOC Amount upon Gavilon’s written notice to Lender, with a copy to Producer, stating that there has been (i) an Event of Default by Producer under the terms of this Agreement; or (ii) a Non-Approval. The letter of credit shall eitherThere will be no further obligation for an ABE LOC hereunder: (i) be issued with a fixed expiration date after payment of December 31, 2005, or the LOC Amount to Gavilon; (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term expiration or termination of this Lease. In Agreement; or (iii) upon a transfer or an assignment of this Agreement pursuant to a Purchaser Change of Control (as defined in Section 28) if Gavilon has reasonably determined, in its sole discretion, that neither the event succeeding party nor the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior Producer needs to the then-scheduled expiration date of the provide a letter of credit, then Landlord shall have the right to draw . C. After drawing the full amount LOC Amount, Gavilon shall provide written notice to Producer of such letter all amounts due under the terms of credit and to hold such amount this Agreement as part of the Security Deposit pursuant date of Gavilon’s notice to Section 4.3 Lender. Thereafter, Gavilon shall work in good faith to mitigate Producer’s damages under the terms of this Lease. Upon any default Agreement by Tenanttrying to re-lease the Cars to other users, including specifically Tenant’s failure to pay rent or to abide all upon terms deemed reasonable by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure Gavilon (the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease“New Lease(s), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted”). In the event that Tenant has not been Gavilon receives net revenues from the New Lease(s) during the remaining term of this Agreement which results in default total damages owed by Producer to Gavilon to fall below the full LOC Amount drawn by Gavilon, then Gavilon shall reimburse Producer for the difference between the LOC Amount and the actual damages owed by Producer to Gavilon under the Lease terms of this Agreement. Any calculation of “net revenues” received by Gavilon under the New Lease(s) shall exclude (beyond i) any taxes imposed on the expiration of any applicable cure period) at any time during the Term hereofCars due to re-leasing, and provided further that Tenant has not at any time been more than five (5ii) days late more than once during all costs and expenses incurred by Gavilon to (x) obtain possession of the applicable previous twelve Cars, (12)-month period with respect y) re-lease the Cars to any payments of rent due third parties under the LeaseNew Lease(s), then including any reasonable internal personnel costs as determined by Gavilon, and (z) enforce this Agreement and the New Lease(s). D. Producer acknowledges and agrees that Gavilon’s obligation to reimburse Producer for any differences between the LOC Amount and the actual damages incurred by Gavilon (as outlined in Section 18C above) shall not impact, alter or diminish Gavilon’s right to draw upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit ABE LOC in the amount full LOC Amount and/or to enforce any of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon its other remedies as set forth in this Agreement. E. Producer and its affiliates shall have reasonable audit rights over Gavilon’s mitigation efforts and related books and records in Section 18C and 18D above for as long as reasonably necessary even after the expiration termination of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months this Agreement. Gavilon will cooperate with all of the TermProducer’s reasonable audit requests.

Letter of Credit. In addition to the Security Deposit Concurrently with Tenant’s execution and as security hereunderdelivery of this Lease, Tenant shall deliver to LandlordLandlord a clean, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit set forth in Section 1, which shall comply with, and may be drawn by Landlord in form and with accordance with, the substance provisions of Exhibit F G attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: hereto (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the such letter of credit, then Landlord together with any renewal or replacement thereof in accordance herewith, being referred to herein as the “Letter of Credit”). Notwithstanding any provision herein to the contrary, so long as (A) Tenant shall not be, or have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of been, in monetary or material non-monetary Default under this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 (B) this Lease is still in full force and 15.3 below effect, and Tenant’s failure to cure (C) Tenant provides Landlord with written notice requesting the same within any applicable cure period(requirements (A) through (C), Landlord collectively, the “Letter of Credit Reduction Conditions”), then Tenant shall be entitled to draw upon said letter of credit by reduce the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full required amount of the letter Letter of credit can Credit to the amounts and at the times set forth below, and Tenant may thereafter deliver to Landlord a substitute Letter of Credit, conforming to the requirements hereof, in the sum of such reduced amount. Upon Tenant complying with the Letter of Credit Reduction Conditions set forth above, the required amount of the Letter of Credit shall be drawn by reduced in accordance with the following schedule: Date: Letter of Credit Amount Reduced To: First (1st) anniversary of the Rent Commencement Date $ 720,164.00 Third (3rd) anniversary of the Rent Commencement Date $ 480,109.33 Upon and as a condition to each such reduction, Tenant shall deliver to Landlord pending determination a substitute Letter of said Credit, conforming to the requirements hereof, in the sum of the reduced Letter of Credit amount, whereupon Landlord shall surrender to Tenant the Letter of Credit being so replaced within thirty (30) Days; provided, however, that in no event shall the amount of the Letter of Credit hereunder ever be less than $480,109.33. Upon Landlord’s receipt of a substitute Letter of Credit in compliance with Exhibit G, Landlord agrees not to draw upon the Letter of Credit being so replaced. Notwithstanding the foregoing, while Tenant acknowledges that upon the amount occurrence of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount monetary or material non-monetary Default of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by TenantTenant hereunder, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall not be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect entitled to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit further reduction in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration Letter of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th)Credit, and forty-eighth (48th) months Tenant’s Letter of the TermCredit obligation shall not be reduced below its then current level.

Letter of Credit. In addition to 4.2.1 Within three (3) business days following the Security Deposit and as security hereunderLease Date, Tenant shall deliver to LandlordLandlord an unconditional, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by and transferable letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The the original amount of ONE MILLION AND NO/100 DOLLARS ($1,000,000.00) (such letter of credit and any renewals or substitutions thereof herein called the “Letter of Credit”); provided that such Letter of Credit (i) shall eitherprovide for not less than forty-five (45) days prior notice to Landlord of any termination or non-renewal and (iii) shall otherwise be in a form reasonably acceptable to Landlord and in compliance with the requirements of this Lease. 4.2.2 The Letter of Credit shall be held by Landlord as additional security for the full and faithful performance by Tenant of all of the terms and conditions of this Lease, including, without limitation, the payment of all amounts past due as of the occurrence of a Tenant Default. The Letter of Credit shall not be considered an advance payment of rent, nor shall it be a measure of Landlord’s damages in case of the occurrence of a Tenant Default. Tenant shall not be entitled to receive and shall not receive any interest on the Letter of Credit or any amounts drawn thereon. If, in the reasonable judgment of Landlord, the national bank issuing the Letter of Credit (or any replacement Letter of Credit, if applicable) is or may become unable to honor the obligations contained therein, Tenant shall, within fifteen (15) days after Landlord’s written request, provide a replacement Letter of Credit from another national bank acceptable to Landlord (in Landlord’s reasonable discretion), which replacement Letter of Credit shall be in the full amount of the initial Letter of Credit and shall otherwise comply in all respects with the provisions of this Lease. 4.2.3 It is understood and agreed that the Letter of Credit shall provide that the maximum sum that may be drawn by the holder pursuant to its terms shall be reduced annually in accordance with the following schedule; provided that Landlord shall, at no cost to Landlord, cooperate with and assist. Tenant as may be reasonably necessary from time to time to cause the bank issuing the Letter of Credit (or any replacement thereof) to reduce the maximum sum that may be drawn by the holder to the amounts shown below: Applicable Dates Maximum Amount Month 73 — Month 84 $750,000.00 Month 85 — Month 96 $500,000.00 Month 97 — Month 108 $250,000.00 Month 109 — Month 120 $0.00 4.2.4 The Letter of Credit shall provide that, if any Tenant Default occurs, then, without notice to Tenant and without prejudice to any other remedies available to Landlord under this Lease (whether at law, in equity or otherwise), Landlord shall have the right to draw upon the Letter of Credit in full or in partial amounts, subject to the requirement that all amounts so drawn will be used to perform any obligation of Tenant giving rise to such Tenant Default. It is understood and agreed, however, that Landlord’s application of any funds drawn under the Letter of Credit shall not constitute a cure of any Tenant Default unless: (i) this Lease, or Tenant’s right to possession of the Premises, is not terminated by Landlord as the result of such Tenant Default; (ii) such Tenant Default is fully cured by the application of such funds; and (iii) Tenant restores the Letter of Credit to the full amount then required hereunder. 4.2.5 If, (a) Landlord draws on the Letter of Credit and applies the proceeds thereof to cure any Tenant Default hereunder and (b) this Lease, or Tenant’s right to possession of the Premises, is not terminated as the result of such Tenant Default, then Tenant shall, within seven (7) days following Landlord’s written request, either: (1) deposit with Landlord, as a part of the Security Deposit, a cash sum equal to the amount drawn on the Letter of Credit, less any portion of that draw not applied by Landlord; (ii) cause the Letter of Credit to be issued with amended to restore the available balance to the amount available immediately prior to Landlord’s draw; or (iii) furnish a fixed substitute Letter of Credit in the full amount of the initial Letter of Credit and otherwise conforming to the requirements of this Lease. 4.2.6 If any Letter of Credit (i) has an expiration date which is prior to the expiration date of December 31the Term, 2005as extended, or (ii) shall provide provides for automatic annual renewals through and extensions absent the issuer’s notification that date which is sixty such Letter of Credit will not be renewed and extended, and Landlord has received such written notification from such issuer that the Letter of Credit will not be renewed or extended, then, at least thirty (6030) days after prior to such expiration date or, if applicable, the Expiration Date effective date of any such written notice from the Term issuer, Tenant shall furnish Landlord with a renewal or substitute Letter of Credit in the full amount required above and otherwise conforming to the requirements of this Lease. In If Tenant fails to renew or replace the event the letter Letter of credit is issued Credit in accordance with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of creditthis provision, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter Letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any Credit and hold such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord cash as the result of Tenant’s default (as determined pursuant to Security Deposit in accordance with the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Term.

Letter of Credit. (a) In addition order to further secure the payment of principal of and interest on, and Purchase Price of, the Bonds, when due, prior to the Security Deposit initial delivery of the Bonds the Company shall secure and as security hereunder, Tenant shall deliver to Landlordthe Trustee, concurrently with Tenant’s execution for the benefit of this Leasethe owners of the Bonds, an irrevocable stand-by letter the Letter of credit in the amount Credit. The Letter of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit Credit shall be in form an original aggregate amount specified in the Indenture, and the Letter of Credit and any Alternate Letter of Credit shall conform to the requirements set forth in the Indenture. After the initial delivery of the Letter of Credit, and at all times thereafter while any of the Bonds are Outstanding, except during any Multiannual or Fixed Rate Period, the Company shall continuously secure the Bonds by either extensions of the Letter of Credit or by the securing and delivery of an Alternate Letter of Credit unless the Company has determined, pursuant to Section 10.05 of the Indenture, not to secure payment of principal of and interest on, and Purchase Price of, the Bonds with the substance Letter of Exhibit F attached hereto, and issued by Silicon Valley Bank Credit or by another financial institution located in Orange County and which is acceptable to Landlordan Alternate Credit Facility. The letter Company hereby authorizes the Trustee to seek payment under any Letter of credit shall either: (i) be issued Credit in accordance with a fixed expiration date its terms and the terms of December 31the Indenture. As long as the Letter of Credit is in effect and the Bank is not in default thereunder, 2005the Company's obligation to make Installment Payments sufficient hereunder to pay principal of, premium, if any, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after interest on the Expiration Date Bonds or to pay Purchase Price of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed Bonds shall be satisfied solely from payments made by the issuing financial institution on or before twenty Bank pursuant to the Letter of Credit. Amounts drawn by the Trustee under any Letter of Credit shall be credited against the obligation of the Company to make Installment Payments hereunder. (20b) The Company shall notify the Trustee in writing at least forty- five days prior to the then-scheduled expiration date of an existing Letter of Credit whether or not the Bank intends to extend such Letter of Credit or whether a binding obligation to secure an Alternate Letter of Credit has been entered into. (c) The Company, the Trustee, and the Bank, with the written consent of the letter of creditIssuer, then Landlord shall have may, without the right to draw the full amount of such letter of credit and to hold such amount as part consent of the Security Deposit pursuant to Section 4.3 Bondholders, amend, change, or modify any Letter of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure Credit (i) to cure any ambiguity, formal defect, inconsistency, or minor omission, (ii) to conform to the same within requirements of the Indenture or the Rating Agencies, or (iii) if such amendment, change or modification is not prejudicial to the Bondholders in any applicable cure period, Landlord material respect and the Trustee receives a Favorable Opinion to such effect.. (d) The Company shall be entitled to draw upon said letter of credit pay all costs incurred by the issuance of Landlord’s sole written demand to Trustee and the issuing financial institution. Such draw shall be Issuer in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred therebyconnection with any reissuance, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount extension or substitution of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount Alternate Letter of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermCredit.

Letter of Credit. In addition (a) Tenant within five (5) business days after the date on which Landlord executes this Lease, shall provide to Landlord an unconditional, clean, irrevocable letter of credit (the Security Deposit “Letter of Credit”) in the amount of Three Hundred Thirty Thousand Dollars ($330,000), and otherwise in a form as shall he approved by Landlord in its reasonable discretion, as security hereunderfor Tenant’s faithful performance of Tenant’s obligations under this Lease. (b) The Letter of Credit shall be issued by a money center bank (a bank which accepts deposits, maintains accounts, has a local Los Angeles office which will negotiate a letter of credit and whose deposits are insured by the FDIC) reasonably acceptable to Landlord, and shall be for a period commencing on the date of issuance of the Letter of Credit and expiring at the end of the First “Lease Year” (as defined in Section 4.2(iii) hereof). Tenant shall pay all expenses, points and/or fees incurred by Tenant in obtaining, modifying, renewing or reissuing the Letter of Credit. The Letter of Credit shall be held by Landlord as Security for the faithful performance by Tenant of all of the terms, covenants and conditions of this Lease to be kept and performed by Tenant. The Letter of Credit shall not be mortgaged, assigned or encumbered in any manner whatsoever by Tenant without the prior written consent of Landlord. (c) Said Letter of Credit shall be extended annually through the expiration of the Tenth Lease Year, each extension to be effective from the first day of each applicable Lease Year through the last day of each applicable Lease Year, and Tenant shall deliver each such extended Letter of Credit to LandlordLandlord no later than thirty (30) days prior to the effective date of said extended Letter of Credit. Provided that for each Lease Year, concurrently with Tenant’s execution net worth shall be equal to or greater than Four Million Dollars ($4,000,000) as shown on its most recent audited financial statements, the extended Letters of Credit for the subsequent Lease Year shall be reduced to the following amounts: Second Lease Year Third Lease Year Fourth Lease Year Fifth Lease Year Sixth through Tenth Lease Years $264,000 198,000 132,000 66,000 66,000 In the event that the Tenant’s net worth shall be less than Four Million Dollars ($4,000,000), the face amount of the letter of credit for the subsequent Lease Year shall equal the amount of the previous year’s letter of credit with no reduction. Commencing with the Sixth Lease Year, so long as Tenant’s net worth shall exceed Four Million Dollars ($4,000,000) for the previous Lease Year, Tenant may at any time elect to terminate the letter of credit and substitute a security deposit in the amount of one-twelfth of the Minimum Rent payable for that Lease Year. In the event that Tenant elects to substitute a security deposit, the provisions of Section 20.1(g) shall apply to such deposit. (The amount of each letter of credit for each of the ten respective Lease Years as set forth above shall be referred to as an “L-C Amount”). Failure to provide said extended Letter of Credit to landlord as provided herein, without notice or demand, shall be an immediate default of Tenant, which shall permit Landlord at its option to immediately draw in full said Letter of Credit. (d) If an Event of Default (as defined in Section 18.1 hereof) has occurred and is continuing, with respect to any provision of this Lease, an irrevocable stand-including, but not limited to, the provisions relating to the payment of Rent, Landlord may, but shall not be required to, draw upon that portion of the Letter of Credit necessary for the payment of any Rent or any other sum in default, or for the payment of any amount that Landlord may reasonably spend or may become obligated to spend to cure any other material default by letter Tenant (after the expiration of credit any applicable notice and cure period set forth in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00Section 18.1). Said letter The use, application or retention of credit the Letter of Credit, or any portion thereof, by Landlord shall not prevent Landlord from exercising any other right or remedy provided by this Lease, the Guaranty or by law, it being intended that Landlord shall not first be required to proceed against the Letter of Credit, and shall not operate as a limitation on any recovery to which Landlord may otherwise be entitled. Any penalty assessed by the financial institution for the early withdrawal from such account due to a default by Tenant shall be in form and with borne by Tenant. (e) If any portion of the substance Letter of Exhibit F attached heretoCredit is drawn upon, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: Tenant shall, within ten (10) days after written demand therefor, either (i) be issued deposit cash with a fixed expiration date Landlord in an amount equal to the difference between the L-C Amount and the remaining amount available to Landlord under the Letter of December 31, 2005Credit, or (ii) shall provide deposit with Landlord another irrevocable letter of credit for automatic annual renewals through that date which is sixty (60) days after the Expiration Date remaining term of the Term Letter of Credit, in form and substance acceptable to Landlord from a bank acceptable to Landlord, in an amount equal to the difference between the L-C Amount and the remaining amount available to Landlord under the Letter of Credit, and Tenant’s failure to do so shall be a material breach of this Lease. In Landlord shall not be required to keep said deposit (if paid in cash) separate from its general accounts. If Tenant shall fully and faithfully perform every provision of this Lease to be performed by it, the cash deposit, or so much thereof as has not theretofore been applied by Landlord pursuant to the terms of this Section 20, shall be returned to Tenant within thirty (30) days following the expiration of the Letter of Credit. No trust relationship is created herein between Landlord and Tenant with respect to said Letter of Credit. (f) Tenant acknowledges that Landlord has the right to transfer or mortgage its interest in the Shopping Center and/or the Premises in this Lease, and Tenant agrees that in the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on any such transfer or before twenty (20) days prior to the then-scheduled expiration date of the letter of creditmortgage, then Landlord shall have the right to draw transfer or assign the full amount Letter of Credit to the transferee or mortgagee, and in the event of such letter transfer, Tenant shall look solely to such transferee or mortgagee for the return of credit and any such cash deposit and/or the Letter of Credit. (g) In the event that Tenant elects to hold substitute a security deposit for the Letter of Credit beginning with the sixth lease year, the provisions of this paragraph shall apply to such amount as part of the Security Deposit pursuant security deposit. If Tenant fails to Section 4.3 pay Minimum Rent, Additional Rent or other charges due hereunder, or otherwise defaults with respect to any provision of this Lease. Upon , Landlord may use all or any default portion of the security deposit for the payment of any Rent or other charge due hereunder, to pay any other sum to which Landlord may become obligated by Tenant, including specifically reason of Tenant’s failure to pay rent default, or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver loss or any rights damage which Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the defaultsuffer thereby. If Landlord so uses or applies all or any portion of the letter of credit is drawn after a default by Tenantsaid deposit, Tenant shall within five thirty (530) days after written demand by therefore deposit cash with Landlord restore the letter of credit. Failure in an amount sufficient to so restore said letter deposit to its full amount. Landlord shall not be required to keep the security deposit separate from its general accounts. If Tenant performs all of credit within said five (5) days shall be a default by Tenant Tenant’s obligations under this Lease. Partial drawings upon said letter of credit , the deposit, or so much thereof as has not heretofore been applied by Landlord, shall be permitted. In returned, without payment interest or other amount for its use, to Tenant (or at the event that Tenant has not been in default under Landlord’s option, to the Lease (beyond the expiration last assignee, if any, of any applicable cure periodTenant’s interest hereunder) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th)term hereof, and forty-eighth (48th) months after Tenant has vacated the Premises. No trust relationship is created herein between Landlord and Tenant with respect to the security deposit. Tenant acknowledges that the security deposit is not an advance payment of any kind or a measure of Landlord’s damages in the Termevent of Tenant’s default. Tenant hereby waives the provisions of any law which is inconsistent with this Article XX.

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by standby letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Million Dollars ($166,229.001,000,000.00). Said letter of credit shall be in form and with the substance of Exhibit EXHIBIT F attached hereto, and issued by Silicon Valley Bank [Bank] or by another financial institution located in Orange County and which is reasonably acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease (including any extensions of the Term as provided in this Lease). In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default “Event of Default” by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodTenant (as defined in Section 14.1), Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such , which draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant no Event of Default has not been in default under the Lease (beyond the expiration of any applicable cure period) occurred at any time during the Term hereof, and provided further that Tenant has not at any time been more than five ten (510) days late on more than once during the applicable previous twelve two (12)-month period 2) occasions with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Five Hundred Thousand Two Hundred Forty-Six Dollars ($33,246.00500,000.00) each upon the expiration of the twelfth (12th), twenty-fourth fifth (24th), 25th) and thirty-sixth seventh (36th), and forty-eighth (48th37th) months of the Term.

Letter of Credit. In addition to the Security Deposit and as security hereunderOn or before May 1, 2008, Tenant shall deliver to Landlord an unconditional, irrevocable, transferable and negotiable standby letter of credit (the “LC”) in an amount equal to $276,909.00 (the “Face Amount”). On or before Xxxxx 0, 0000, Xxxxxx shall deliver to Landlord a new LC in the increased Face Amount of $420,612.00. Landlord shall return the original LC to Tenant no later than ten (10) Business Days after Landlord, concurrently with Tenant’s execution receipt of the new LC. As used in this Lease, an irrevocable stand-by letter of credit the terms “LC” and “Face Amount” refer to the LC and the Face Amount then required to be delivered to Landlord and in effect pursuant to the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term terms of this Lease. In the event the letter of credit is The LC must be issued by a bank or trust company with an annual renewal obligation office in San Francisco (“Issuer”) and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior in form and content acceptable to the then-scheduled expiration date of the letter of creditLandlord, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, as additional security for the performance of Tenant’s obligations under this Lease. The LC shall name Landlord as beneficiary thereunder and if such amount cannot provide that draws (including, at Landlord’s election, partial draws) will be readily determined honored upon the delivery to the Issuer of a certificate signed by Landlord, or its authorized agent, that Tenant has failed to perform its obligations under the Lease. The LC shall also provide that it will be automatically extended upon each renewal date unless the Issuer thereof delivers to Landlord, no later than forty-five (45) days prior to the stated expiration date of the LC, written notice of Issuer’s intent not to extend or renew the LC. During any period that Tenant is required to maintain the LC, Tenant shall, at least thirty (30) days prior to any expiration or termination of the LC, provide Landlord either with written confirmation that the existing LC will be automatically extended and renewed or with a new LC that satisfies all of the requirements for the LC in this Section 4.2. In addition, upon a proposed sale or other transfer of any interest in the Building, this Lease or Landlord (including consolidations, mergers, or other entity changes), Tenant, at its sole cost and expense and upon thirty (30) days’ notice, shall, concurrently with Landlord’s delivery to Tenant of the then outstanding LC, deliver to any such transferees, successors or assigns a replacement LC on identical terms (except for the stated beneficiary) from the same Issuer or another bank or trust company acceptable to Landlord, in Landlord’s sole discretion, or an amendment to the outstanding LC naming the new landlord as the beneficiary thereof. Tenant’s failure to perform or observe any of the covenants set forth in this Section 4.2 for any reason shall entitle Landlord to draw on the full amount of the letter LC and shall constitute an Event of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have Default under this Lease without the requirement of any notice from Landlord. Any amount(s) drawn under the LC shall be held or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand used by Landlord restore in accordance with the letter terms of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermSection 4.1.

Letter of Credit. In addition to At such time as Landlord acquires the Security Deposit Land and as security hereunderthe Credit Termination Right expires or is waived by Landlord, Tenant shall deliver to LandlordLandlord an unconditional, concurrently with Tenant’s execution of this Leaseirrevocable, an irrevocable stand-by transferable letter of credit credit, in the amount of One Seven Million Five Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.007,500,000). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank of America NT & SA, or by another financial institution located in Orange County and which is reasonably acceptable to Landlord. The letter , in the form attached hereto as Exhibit ”M”, with an original term of credit shall either: (i) be issued with a fixed expiration date no less than one year and automatic extensions through the end of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is the Term of this Lease and sixty (60) days thereafter (the “Letter of Credit”). Tenant shall keep the Letter of Credit,’ at its expense, in full force and effect until the sixtieth (60th) day after the Expiration Date of the Term or other termination of this Lease, to insure the faithful performance by Tenant of all of the covenants, terms and conditions of this Lease, including, without limitation, Tenant’s obligations to repair, replace or maintain the Premises and to maintain the Letter of Credit, and Tenant’s payment obligations with respect to Tenant Modifications (as defined in the Work Letter) being made by Change Order to Landlord’s construction contract. In The Letter of Credit shall provide thirty (30) days’ prior written notice to Landlord of cancellation or material change thereof, and shall further provide that, in the event of any nonextension of the letter Letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty Credit at least thirty (2030) days prior to its expiration, the then-scheduled expiration date of the letter of creditentire face amount shall be payable to Landlord, then and Landlord shall have hold any funds so obtained as the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of security deposit required under this Lease. Upon Such funds so obtained by Landlord, or any unused portion thereof, shall be returned to Tenant upon replacement of the Letter of Credit. If Landlord uses any portion of any cash security deposit to cure any default by TenantTenant hereunder, including specifically Tenant shall replenish the security deposit to the original amount within ten (10) days of notice from Landlord. Tenant’s failure to pay rent or to abide by do so shall become a material default under this Lease. Landlord shall keep any cash security funds separate from its obligations under Sections 7.1 general funds, and 15.3 below and shall invest such cash security at Tenant’s failure reasonable direction, and any interest actually earned by Landlord on such cash security shall be paid to cure Tenant on a quarterly basis within ten (10) business days after receipt thereof by Landlord. If an uncured or incurable default occurs under this Lease, or if Tenant is the same within any applicable cure periodsubject of an Insolvency. Proceeding, Landlord may present its written demand for payment of the entire face amount of the Letter of Credit and the funds so obtained shall be entitled to draw upon said letter of credit by the issuance of paid to, or as otherwise directed by, Landlord’s sole written demand . Landlord may retain such funds to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and extent required to compensate Landlord for all damages incurred therebyincurred, or to reimburse Landlord as determined by Landlord provided herein, in its sole and absolute discretionconnection with any such default, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw remaining funds shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity held as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termcash security deposit.

Letter of Credit. In addition to the Security Deposit and as additional security hereunderfor the full and faithful performance of Tenant's obligations under this Lease, Tenant shall deliver to Landlordlandlord, concurrently with Tenant’s 's execution and delivery of this Lease, an irrevocable stand-by a letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Million Dollars ($166,229.001,000,000.00). Said , which letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another a --------- financial institution located in Orange County and which is reasonably acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual yearly renewals through that date which is sixty (60) days after the Expiration Date of throughout the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty Upon (20i) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s 's failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s 's failure to cure the same within any applicable cure period, and (ii) Landlord's application of the entire Security Deposit, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s 's sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter Upon the expiration of credit within said five the twelfth (512th), twenty- fourth (24th), thirty-sixth (36th), forty-eighth (48th) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In and sixty-ninth (69th) Lease months during the Term, in the event that Tenant has not been in monetary or material non-monetary default under this Lease during the Lease immediately preceding twelve (beyond 12) month period ending on each such expiration date (or the immediately preceding twenty-one (21) month period ending on the expiration of any applicable cure periodthe sixty- ninth (69th) at any time during Lease month with respect to the Term hereoffinal reduction) (each period being referred to herein as a "Reduction Period"), and provided further that Tenant has not at any time during the applicable Reduction Period been more than five (5) days late more than once during the applicable previous twelve (12)-month period twice with respect to any payments of rent due under the this Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions a reduction to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Thousand Dollars ($33,246.00200,000.00) each upon with respect to the expiration Reduction Period in question. In the event Tenant has been in monetary or material non-monetary default under this Lease during a particular Reduction Period or has during such Reduction Period been more than five (5) days late more than twice with respect to any payments of rent due under this Lease, then Tenant's right to a $200,000.00 reduction for such Reduction Period shall be forever forfeited by Tenant (notwithstanding the twelfth (12thfact that Tenant may be entitled to a $200,000.00 reduction hereunder with respect to subsequent Reduction Period(s), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Term.

Letter of Credit. In addition to (A) Concurrently with the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit Tenant shall pay to Landlord a security deposit in the amount of One Million One Hundred Forty Thousand Three Hundred Seventy Eight Dollars and Sixty Six Thousand Two Hundred Twenty-Nine Dollars Cents ($166,229.001,140,378.60) and Landlord shall hold the same, throughout the Term of this Lease (including the Extended Term, if applicable), unless sooner returned to Tenant as provided in this Section 16.26, as security for the performance by Tenant of all obligations on the part of Tenant to be performed under this Lease. Said Such deposit shall be in the form of an irrevocable, unconditional, negotiable letter of credit (the “Letter of Credit”) provided that cash may be deposited at the Commencement Date for up to sixty (60) days while Tenant secures the Letter of Credit in conformance with this Section 16.26. The Letter of Credit shall (i) be issued by and drawn on a bank reasonably approved by Landlord and at a minimum having a long term issuer credit rating from Standard and Poor’s Professional Rating Service of A or a comparable rating from Xxxxx’x Professional Rating Service, (ii) be substantially in the form and attached hereto as Exhibit J or on another form reasonably satisfactory to Landlord, (iii) permit one or more draws thereunder to be made accompanied only by certification by Landlord or Landlord’s managing agent that pursuant to the terms of this Lease, Landlord is entitled to draw upon such Letter of Credit, (iv) permit transfers at any time without charge, (v) permit presentment in Boston, Massachusetts, or by facsimile with presentation by overnight delivery the substance of Exhibit F attached heretonext day, and (iv) provide that any notices to Landlord be sent to the notice address provided for Landlord in this Lease. Landlord acknowledges that the letter of credit issued by Silicon Valley Bank or simultaneously with the execution of this Lease has been approved by another financial institution located in Orange County and which is acceptable to Landlord. The If the credit rating for the issuer of such Letter of Credit falls below the standard set forth in (i) above or if the financial condition of such issuer changes in any other material adverse way, Landlord shall have the right to require that Tenant provide a substitute letter of credit that complies in all respects with the requirements of this Section, and Tenant’s failure to provide the same within thirty (30) days following Landlord’s written demand therefor shall either: entitle Landlord to immediately draw upon the Letter of Credit. Any such Letter of Credit shall be for a term of one (i1) be issued with a fixed expiration date of December 31, 2005, or (ii) year and shall in either case provide for automatic annual renewals through that the date which is sixty (60) days after subsequent to the Expiration Date scheduled expiration of this Lease (as the same may be extended) or if the issuer will not grant automatic renewals, the Letter of Credit shall be renewed by Tenant each year and each such renewal shall be delivered to and received by Landlord not later than thirty (30) days before the expiration of the Term then current Letter of this LeaseCredit (herein called a “Renewal Presentation Date”). In the event the letter of credit is issued with an annual a failure to so deliver any such renewal obligation and the letter Letter of credit is not renewed by the issuing financial institution Credit on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodRenewal Presentation Date, Landlord shall be entitled to present the then existing Letter of Credit for payment and to receive the proceeds thereof, which proceeds shall be held as Tenant’s security deposit, subject to the terms of this Section 16.26. Any failure or refusal of the issuer to honor the Letter of Credit shall be at Tenant’s sole risk and shall not relieve Tenant of its obligations hereunder with regard to the security deposit. Upon the occurrence of any default of Tenant, Landlord shall have the right from time to time without prejudice to any other remedy Landlord may have on account thereof, to draw upon said letter on all or any portion of credit by such deposit held as a Letter of Credit and to apply the issuance proceeds of such Letter of Credit or any cash held as such deposit, or any part thereof, to Landlord’s sole written demand to damages arising from such default on the issuing financial institution. Such draw shall be in an amount necessary to cure part of Tenant under the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV terms of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If Landlord so applies all or any portion of the letter of credit is drawn after a default by Tenantsuch deposit, Tenant shall within five seven (57) days after written demand by notice from Landlord deposit cash with Landlord in an amount sufficient to restore such deposit to the letter full amount stated in this Section 16.26. While Landlord holds any cash deposit Landlord shall have no obligation to pay interest on the same and shall have the right to commingle the same with Landlord’s other funds. Neither the holder of credit. Failure a mortgage nor the Landlord in a ground lease on property which includes the Premises shall ever be responsible to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In for the event that Tenant has not been in default under the Lease (beyond the expiration return or application of any applicable cure periodsuch deposit, whether or not it succeeds to the position of Landlord hereunder, unless such deposit shall have been received in hand by such holder or ground Landlord. (B) at any time during If Tenant satisfies the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during Reduction Condition as of the applicable previous twelve (12)-month period with respect to any payments of rent due under the LeaseReduction Review Date, then as such terms are hereinafter defined, then, upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter Letter of credit in the amount of Thirty Three Credit shall be reduced to (i) Eight Hundred Fifty Five Thousand Two Hundred Forty-Six Eighty Three Dollars and Ninety Five Cents ($33,246.00855,283.95) each upon if, as of the expiration of the twelfth first full Rent Year no monetary or material non-monetary Event of Default by Tenant has occurred, and (12thii) Five Hundred Seventy Thousand One Hundred Eighty Nine Dollars and Thirty Cents ($570,189.30) if, as of the expiration of the second full Rent Year no monetary or material non-monetary Event of Default by Tenant has occurred. In no event shall the Letter of Credit have automatic reduction provisions. Upon Tenant’s satisfaction of the Reduction Condition(s), twenty-fourth Landlord shall authorize Tenant and the Letter of Credit issuer to amend or replace the existing Letter of Credit, at Tenant’s option and at Tenant’s sole cost and expense, in accordance with the reduced amounts set forth in this Section 16.26(B). (24th)C) Tenant not then being in default and having performed all of its obligations under this Lease in all material respects, thirty-sixth (36th)including the payment of all Annual Fixed Rent, and forty-eighth (48th) months Landlord shall return the deposit, or so much thereof as shall not have theretofore been applied in accordance with the terms of this Section 16.26, to Tenant on the expiration or earlier termination of the Termterm of this Lease (as the same may have been extended) and surrender possession of the Premises by Tenant to Landlord in the condition required in the Lease at such time.

Letter of Credit. In addition Notwithstanding anything to the contrary contained herein, Tenant shall have the option to deliver to Landlord a Letter of Credit (as set forth below) in lieu of the Security Deposit and as security hereunderset forth in Section 5.01 above. If Tenant elects to post a Letter of Credit in lieu of the Security Deposit, then the following shall apply: (a) No later than February 1, 2004, Tenant shall deliver to Landlord the Letter of Credit described below as security for Tenant’s performance of all of Tenant’s covenants and obligations under this Lease; provided, however, that neither the Letter of Credit nor any Letter of Credit Proceeds (as defined below) shall be deemed an advance rent deposit or an advance payment of any other kind, or a measure of Landlord’s damages upon Tenant’s default. The Letter of Credit shall be maintained in effect from the date thereof through January 31, 2011 (the “LOC Expiration Date”), and provided that on the LOC Expiration Date, Tenant shall not be in Default, Landlord shall return to Tenant the Letter of Credit and any Letter of Credit Proceeds then held by Landlord (other than those held for application by Landlord on account of a Default as provided below). Landlord shall not be required to segregate the Letter of Credit Proceeds from its other funds and no interest shall accrue or be payable to Tenant with respect thereto. Landlord may (but shall not be required to) draw upon the Letter of Credit and use the proceeds therefrom (the “Letter of Credit Proceeds”) or any portion thereof to cure any Default under this Lease, it being understood that any use of the Letter of Credit Proceeds shall not constitute a bar or defense to any of Landlord’s remedies set forth in this Lease. In such event and upon written notice from Landlord to Tenant specifying the amount of the Letter of Credit Proceeds so utilized by Landlord and the particular purpose for which such amount was applied, Tenant shall immediately deliver to Landlord an amendment Letter of Credit or a replacement Letter of Credit in an amount equal to the difference between the amount of the required Letter of Credit and the amount so expended. Tenant’s failure to deliver such amendment to the Letter of Credit or replacement Letter of Credit to Landlord within five (5) business days of Landlord’s notice shall constitute a Default hereunder. If Tenant is not in Default on the LOC Expiration Date, within forty-five (45) days after such date, Landlord shall return to Tenant the Letter of Credit or the balance of the Letter of Credit Proceeds then held by Landlord; provided, however, that in no event shall any such return be construed as an admission by Landlord that Tenant has performed all of its obligations hereunder. No purchaser at any judicial or private foreclosure sale of the Real Property or any portion thereof, shall be responsible to Tenant for such Letter of Credit or any Letter of Credit Proceeds unless such holder or purchaser shall have actually received the same. (b) As used herein, Letter of Credit shall mean an unconditional, irrevocable letter of credit (hereinafter referred to as the “Letter of Credit”) issued by the San Francisco Bay Area office of a major national bank satisfactory to Landlord (the “Bank”), naming Landlord as beneficiary, in the initial amount of Four Hundred Fifty Thousand and No/100 Dollars ($450,000.00). The Letter of Credit shall be for not less than a one-year term and shall provide that (i) Landlord may make partial and multiple draws upon the Letter of Credit up to the full amount thereof, as determined by Landlord, concurrently (ii) the Bank will pay to Landlord the amount of such draw upon receipt by the Bank of a sight draft signed by Landlord, together with a written certification from Landlord that Tenant is in Default, (iii) Landlord is therefore entitled to draw such amount; and (iv) in the event of Landlord’s assignment or other transfer of its interest in this Lease, the Letter of Credit shall be freely transferable by Landlord, without charge and without recourse, to the assignee or transferee of such interest and the Bank shall confirm the same to Landlord and such assignee or transferee. In the event that the Bank shall fail to notify Landlord that the Letter of Credit will be renewed for at least one (1) year beyond the then applicable expiration date, and Tenant shall not have delivered to Landlord, at least thirty (30) days prior to the relevant annual expiration date, a replacement Letter of Credit in the amount required hereunder and otherwise meeting the requirements set forth above, then Landlord shall be entitled to draw on the Letter of Credit as provided above, and shall hold the proceeds of such draw as Letter of Credit Proceeds pursuant to Section 5.02(a) above. (c) Notwithstanding anything to contrary contained herein, if Tenant is not in Default under the Lease on February 1, 2006, the replacement Letter of Credit may be issued in the amount of Four Hundred Five Thousand and No/100 Dollars ($405,000.00). If Tenant is not in Default under the Lease on February 1, 2007, the replacement Letter of Credit may be issued in the amount of Three Hundred Sixty Thousand and No/100 Dollars ($360,000.00). If Tenant is not in Default under the Lease on February 1, 2008, the replacement Letter of Credit may be issued in the amount of Three Hundred Fifteen Thousand and No/100 Dollars ($315,000.00). If Tenant is not in Default under the Lease on February 1, 2009, the replacement Letter of Credit may be issued in the amount of Two Hundred Seventy Thousand and No/100 Dollars ($270,000.00). If Tenant is not in Default under the Lease on February 1, 2010, the replacement Letter of Credit may be issued in the amount of Two Hundred Twenty Five Thousand and No/100 Dollars ($225,000.00). (d) The cost of the Letter of Credit shall be paid by Tenant’s execution . If Tenant shall fully and faithfully comply with all the terms, provisions, covenants, and conditions of this Lease, an irrevocable stand-by letter the Letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit Credit, or any balance thereof, shall be in form and with returned to Tenant after the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: following: (i) be issued with a fixed the expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date earlier termination of the Term of this Lease. In ; (ii) the event removal of Tenant and its property from the letter of credit is issued with an annual renewal obligation and Premises; (iii) the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date surrender of the letter of credit, then Premises by Tenant to Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of in accordance with this Lease. Upon any default ; and (iv) the payment by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount Tenant of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoingoutstanding Rent, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined including, without limitation, all Rent Adjustments due pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund Lease as computed by Landlord. If Tenant fails timely to perform any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have obligation under this Lease or at law or in equity as Article Five, such breach shall constitute a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default Default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration without any right to or requirement of any applicable further notice or cure period) at period under any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments other Article of rent due under the this Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), except such notice and forty-eighth (48th) months of the Termcure period expressly provided under this Article Five.

Letter of Credit. In addition to the The Security Deposit required pursuant to Section 6 of the Lease shall be in the form of negotiable standby letter of credit (the “Letter of Credit”), which Letter of Credit shall be delivered to Landlord upon the execution of this Lease by Tenant and shall: (a) be in the amount of $800,000.00, (b) be issued on the form attached hereto as security hereunder, Tenant shall deliver Exhibit F-1 or another form meeting the requirements set forth herein and otherwise acceptable to Landlord, concurrently (c) name Landlord as its beneficiary, (d) be drawn on Silicon Valley Bank or another FDIC insured financial institution satisfactory to the Landlord (the “Issuing Bank”), (e) be able to be drawn upon in Chicago, Illinois, (f) be “callable” at sight, unconditional and irrevocable, (g) be fully assignable, without a fee (or with a fee that shall be payable by Tenant’s execution ), by Landlord and its successors and assigns, (h) permit partial draws and multiple presentations. If permitted by applicable Law, the Letter of Credit shall be an “evergreen” letter of credit, which shall be for a term of not less than 1 year, and which provides that the same shall be automatically renewed for successive 1 year periods through a date which is not earlier than 60 days after the Termination Date of this Lease, an irrevocable stand-by letter of credit in as such date is renewed or extended (the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00“LOC Expiration Date”). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the “evergreen” letter of credit is not renewed permitted by applicable Law or a letter of credit cannot be obtained through the issuing financial institution on LOC Expiration Date, the Letter of Credit (and any renewals or before twenty (20replacements thereof) shall be for a term of not less than 1 year, and Tenant agrees that it shall from time to time, as necessary, as a result of the expiration of the Letter of Credit then in effect, renew or replace the original and any subsequent Letter of Credit so that a Letter of Credit, in the amount required hereunder and meeting the requirements set forth herein, is in effect until a date which is at least 60 days after the LOC Expiration Date. If the LOC Expiration Date is after the stated expiration date of the Letter of Credit then held by Landlord and either the Issuing Bank does not renew the Letter of Credit at least 60 days prior to the then-scheduled stated expiration date of such Letter of Credit or Tenant fails to furnish to Landlord such renewal or replacement at least 60 days prior to the letter stated expiration date of creditsuch Letter of Credit, then Landlord Landlord, or its managing agent, may draw upon such Letter of Credit and hold the proceeds thereof (and such proceeds need not be segregated) as a Security Deposit pursuant to the terms of Section 6 of the Lease. In addition, Landlord, or its then managing agent, shall have the right to draw down an amount up to the full face amount of such letter the Letter of credit and to hold Credit if any of the following shall have occurred or are applicable: (1) such amount as part is due to Landlord under the terms and conditions of this Lease and remains unpaid after the expiration of any applicable notice and cure period, or (2) Tenant has filed a voluntary petition under the U. S. Bankruptcy Code or any state bankruptcy code (collectively, “Bankruptcy Code”), or (3) an involuntary petition has been filed against Tenant under the Bankruptcy Code, or (4) the long term rating of the Security Deposit pursuant Issuing Bank has been downgraded to BBB or lower (by Standard & Poor’s) or Baa2 or lower (by Xxxxx’x) and Tenant has failed to deliver a new Letter of Credit from a bank with a long term rating of A or higher (by Standard & Poor’s) or A2 or higher (by Xxxxx’x) and otherwise meeting the requirements set forth in this Section 4.3 within ten (10) Business Days following notice from Landlord. The Letter of Credit will be honored by the Issuing Bank regardless of whether Tenant disputes Landlord’s right to draw upon the Letter of Credit. Any renewal or replacement of the original or any subsequent Letter of Credit shall meet the requirements for the original Letter of Credit as set forth above, except that such replacement or renewal shall be issued by an FDIC insured financial institution satisfactory to the Landlord at the time of the issuance thereof. If Landlord draws on the Letter of Credit as permitted in this Lease. Upon any default Lease or by Tenantthe Letter of Credit, including specifically Tenantthen, within ten (10) Business Days after receipt of Landlord’s failure written demand, Tenant shall restore the amount available under the Letter of Credit to pay rent or its original amount by providing Landlord with an amendment to abide by the Letter of Credit evidencing that the amount available under the Letter of Credit has been restored to its obligations under Sections 7.1 and 15.3 below original amount and Tenant’s failure to cure do so shall constitute an incurable Default. In the same within alternative, Tenant may provide Landlord with cash, to be held by Landlord in accordance with Section 6 of the Lease, equal to the restoration amount required under the Letter of Credit. If Landlord desires to assign the Letter of Credit, Tenant shall execute and deliver to the Issuing Bank and documents required to effectuate such transfer and pay any transfer and processing fees. The use, application or retention of the Letter of Credit, or any portion thereof, by Landlord shall not prevent Landlord from exercising any other right or remedy provided by this Lease or by any applicable cure periodLaw, it being intended that Landlord shall not first be required to proceed against the Letter of Credit, and it shall not operate as a limitation on any recovery to which Landlord may otherwise be entitled. Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the Issuing Bank in failing to honor a drawing upon such Letter of Credit in a timely manner. Tenant agrees and acknowledges that (a) the Letter of Credit constitutes a separate and independent contract between Landlord and the Issuing Bank, (b) Tenant is not a third party beneficiary of such contract, (c) Tenant has no property interest whatsoever in the Letter of Credit or the proceeds thereof, and (d) in the event Tenant becomes a debtor under any chapter of the Bankruptcy Code, neither Tenant, any trustee, nor Tenant’s bankruptcy estate shall have any right to restrict or limit Landlord’s claim and/or rights to the Letter of Credit and/or the proceeds thereof by application of Section 502(b)(6) of the U. S. Bankruptcy Code or otherwise. Notwithstanding any provision of this Lease to the contrary, provided that a Material Default does not exist under any of the terms and conditions of this Lease and no more than 3 Monetary Defaults have occurred during the Term prior to the applicable Reduction Date, the balance of the Letter of Credit shall be reduced to (i) $650,000.00 on the third (3rd) anniversary of the Commencement Date, (ii) $500,000.00 on the fourth (4th) anniversary of the Commencement Date, and (iii) $350,000.00 on the fifth (5th) anniversary of the Commencement Date (each a “Reduction Date”). On or before each Reduction Date, Tenant shall send Landlord a notice requesting Landlord to reduce the Security Deposit. Provided the conditions set forth above are satisfied, Landlord shall be entitled consent in writing to, and, at no cost to draw upon said Landlord (A) accept from the Issuing Bank, an amendment to the Letter of Credit or a substitute Letter of Credit in the form annexed hereto as Exhibit F-1 or another form meeting the requirements set forth herein and otherwise acceptable to Landlord, which reduces the Letter of Credit as provided herein but which does not otherwise amend or modify same, and (B) if requested by the Issuing Bank, execute and deliver to the Issuing Bank such instruments reasonably required by the Issuing Bank to effectuate such reduction. REF: IRREVOCABLE LETTER OF CREDIT NO. _____________ EXPIRATION DATE: ______________ [NOTE TO ISSUER: INSERT DATE THAT IS 3 YEARS FROM THE ISSUANCE DATE.] GENTLEMEN: WE HEREBY OPEN OUR UNCONDITIONAL IRREVOCABLE CLEAN LETTER OF CREDIT NO. __________ IN YOUR FAVOR AVAILABLE BY YOUR DRAFT(S) AT SIGHT FOR AN AMOUNT NOT TO EXCEED IN THE AGGREGATE ($800,000.00) EFFECTIVE IMMEDIATELY. ALL DRAFTS SO DRAWN MUST BE MARKED “DRAWN UNDER IRREVOCABLE LETTER OF CREDIT OF [ISSUING BANK], NO. __________, DATED _______________, 20__.” THIS LETTER OF CREDIT IS ISSUED, PRESENTABLE AND PAYABLE AT OUR OFFICE AT _________________________, OR SUCH OTHER OFFICE IN CHICAGO, ILLINOIS AS WE MAY DESIGNATE BY WRITTEN NOTICE TO YOU, AND EXPIRES WITH OUR CLOSE OF BUSINESS ON ____________________. IT IS A CONDITION OF THIS LETTER OF CREDIT THAT IT SHALL BE AUTOMATICALLY EXTENDED FOR ADDITIONAL TWELVE MONTH PERIODS THROUGH ____________________ [NOTE: INSERT DATE WHICH IS 60 DAYS AFTER LEASE EXPIRATION], UNLESS WE INFORM YOU IN WRITING BY REGISTERED MAIL OR BY OVERNIGHT MAIL DELIVERED BY A REPUTABLE NATIONAL COURIER AT THE ABOVE ADDRESS (WITH A COPY TO _______________________________________ ____________________________________) DISPATCHED BY US AT LEAST 60 DAYS PRIOR TO THE THEN EXPIRATION DATE THAT THIS LETTER OF CREDIT SHALL NOT BE EXTENDED. IN THE EVENT THIS CREDIT IS NOT EXTENDED FOR AN ADDITIONAL PERIOD AS PROVIDED ABOVE, YOU MAY DRAW HEREUNDER. SUCH DRAWING IS TO BE MADE BY MEANS OF A DRAFT ON US AT SIGHT WHICH MUST BE PRESENTED TO US BEFORE THE THEN EXPIRATION DATE OF THIS LETTER OF CREDIT. THIS LETTER OF CREDIT CANNOT BE MODIFIED OR REVOKED WITHOUT YOUR CONSENT. THIS LETTER OF CREDIT IS PAYABLE IN MULTIPLE DRAFTS AND SHALL BE TRANSFERABLE BY YOU WITHOUT ADDITIONAL CHARGE. DRAWS MAY BE PRESENTED BY FACSIMILE TO FAX NUMBER _____________ UNDER TELEPHONE PRE-ADVICE TO ______________. FURTHER PRESENTATION OF THE ORIGINAL DRAFT AND THIS LETTER OF CREDIT IS NOT REQUIRED. IF DEMAND FOR PAYMENT IS PRESENTED BEFORE 11:00 A.M. CENTRAL TIME, PAYMENT SHALL BE MADE TO YOU OF THE AMOUNT DEMANDED IN IMMEDIATELY AVAILABLE FUNDS NOT LATER THAN 4:00 P.M. CENTRAL TIME ON THE FOLLOWING BUSINESS DAY. IF DEMAND FOR PAYMENT IS PRESENTED AFTER 11:00 A.M. CENTRAL TIME, PAYMENT SHALL BE MADE TO YOU OF THE AMOUNT DEMANDED IN IMMEDIATELY AVAILABLE FUNDS NOT LATER THAN 4:00 P.M. CENTRAL TIME ON THE SECOND BUSINESS DAY. WE HEREBY DO UNDERTAKE TO PROMPTLY HONOR YOUR SIGHT DRAFT OR DRAFTS DRAWN ON US, INDICATING OUR LETTER OF CREDIT NO. __________ FOR THE AMOUNT AVAILABLE TO BE DRAWN ON THIS LETTER OF CREDIT UPON PRESENTATION OF YOUR SIGHT DRAFT IN THE FORM OF SCHEDULE A ATTACHED HERETO DRAWN ON US AT OUR OFFICES SPECIFIED ABOVE DURING OUR USUAL BUSINESS HOURS ON OR BEFORE THE EXPIRATION DATE HEREOF. EXCEPT AS EXPRESSLY STATED HEREIN, THIS UNDERTAKING IS NOT SUBJECT TO ANY AGREEMENTS, REQUIREMENTS OR QUALIFICATION. OUR OBLIGATION UNDER THIS LETTER OF CREDIT IS OUR INDIVIDUAL OBLIGATION AND IS IN NO WAY CONTINGENT UPON REIMBURSEMENT WITH RESPECT THERETO OR UPON OUR ABILITY TO PERFECT ANY LIEN, SECURITY INTEREST OR ANY OTHER REIMBURSEMENT. EXCEPT SO FAR AS OTHERWISE EXPRESSLY STATED, THIS LETTER OF CREDIT IS SUBJECT TO INTERNATIONAL STANDBY PRACTICES 1998, INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 590. [ISSUER OF LETTER OF CREDIT] for value received pay at sight by wire transfer in immediately available funds to _________________________ the sum of U.S. $__________ drawn under irrevocable letter of credit no. __________, dated _______________, 20__, issued by the issuance _________________________. to: [issuer of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof] ____________________________ [CITY, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Term.STATE]

Letter of Credit. In addition to the The Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution may be in the form of this Lease, an irrevocable stand-by letter of credit (the “Letter of Credit”), which Letter of Credit shall: (a) be in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars $73,805.63; ($166,229.00). Said letter of credit shall b) be in issued on the form attached hereto as Exhibit A; (c) name Landlord as its beneficiary; and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another (d) be drawn on an FDIC insured financial institution located in Orange County and which is acceptable satisfactory to the Landlord. The letter Letter of credit shall either: Credit (i) be issued with a fixed expiration date of December 31, 2005, and any renewals or (iireplacements thereof) shall provide be for automatic annual renewals through a term of not less than 1 year. Tenant agrees that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior it shall from time to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred therebytime, as determined necessary, whether as a result of a draw on the Letter of Credit by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver terms hereof or any rights Landlord may have under this Lease or at law or in equity as a result of the defaultexpiration of the Letter of Credit then in effect, renew or replace the original and any subsequent Letter of Credit so that a Letter of Credit, in the amount required hereunder, is in effect until a date which is at least 60 days after the Second Extended Termination Date of the Lease. If Tenant fails to furnish such renewal or replacement at least 60 days prior to the stated expiration date of the Letter of Credit then held by Landlord, Landlord may draw upon such Letter of Credit and hold the proceeds thereof (and such proceeds need not be segregated) as a setoff for full Security Deposit pursuant to the terms of Section IV.A. above. Any renewal or partial compensation replacement of the original or any subsequent Letter of Credit shall meet the requirements for the defaultoriginal Letter of Credit as set forth above, except that such replacement or renewal shall be issued by a national bank satisfactory to Landlord at the time of the issuance thereof. If any portion Landlord draws on the Letter of Credit as permitted in this Amendment or the letter Letter of credit is drawn after a default by TenantCredit, then, upon demand of Landlord, Tenant shall within five (5) days after written demand by Landlord restore the letter amount available under the Letter of credit. Failure Credit to so restore said letter its original amount by providing Landlord with an amendment to the Letter of credit within said five (5) days shall be a default by Tenant Credit evidencing that the amount available under this Lease. Partial drawings upon said letter the Letter of credit shall be permittedCredit has been restored to its original amount. In the event that alternative, Tenant has not been may provide Landlord with cash, to be held by Landlord in default accordance with Section IV.A. above, equal to the restoration amount required under the Lease (beyond the expiration Letter of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermCredit.

Letter of Credit. In addition to the Security Deposit and as security hereunder, (a) Tenant shall deliver to LandlordLandlord a clean, concurrently with Tenant’s execution of this Leaseunconditional, an irrevocable stand-by irrevocable, transferable letter of credit (the "Letter of Credit") in a form reasonably acceptable to the Landlord and issued by Deutsche Bank Group or another financial institution ("Issuer") satisfactory to Landlord. The Letter of Credit shall be in the amount of One Hundred Sixty Six Fifty Thousand Two Hundred Twenty-Nine Dollars ($166,229.00150,000.00). Said letter of credit shall be in form and with , name Landlord as the substance of Exhibit F attached heretobeneficiary thereunder, and issued provide that draws thereunder will be honored upon receipt by Silicon Valley Bank Issuer of a written statement signed by Landlord or by another financial institution located in Orange County and which Xxxxxxxx's authorized agent stating that Landlord is acceptable entitled to Landlord. The letter draw down on a Letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after Credit pursuant to the Expiration Date of the Term terms of this Lease. In Landlord shall be entitled to draw the event entire amount under the Letter of Credit if Xxxxxx does not deliver to Landlord a replacement letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing from Issuer or another financial institution on or reasonably satisfactory to Landlord in the amount and form of the initial Letter of Credit no later than one month before twenty (20) days prior to the then-scheduled expiration date of the letter then existing Letter of credit, then Landlord shall have Credit. If an Event of Default occurs under the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within Lease (after any applicable notice and cure periodperiods), Landlord shall be entitled to draw upon said letter the Letter of credit by the issuance of Landlord’s sole written demand Credit to the issuing financial institution. Such draw shall extent required for payment of any Rent or any other sum as to which there is an Event of Default by Tenant or for any sum which Landlord may expend or may be required to expend by reason of Tenant's Event of Default in an amount necessary respect of any of the terms, covenants and conditions of this Lease, including but not limited to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined any damage or deficiency accrued before or after summary proceedings or other reentry by Landlord, then including the full costs of such proceeding or reentry and further including, without limitation, reasonable attorney's fees, (or, only if partial draws are not permitted, the entire amount of the letter Letter of credit can be drawn Credit). Xxxxxxxx agrees that the Letter of Credit may also provide for partial draws by Landlord pending determination of said amountLandlord. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then It is agreed that Landlord shall promptly refund any such excess always have the right to Tenant. Any such draw shall be without waiver upon and apply the Letter of Credit, or any rights part thereof, as aforesaid, without notice and without prejudice to any other remedy or remedies which Landlord may have under this Lease have, or at law Landlord may pursue any other such remedy or remedies in lieu of drawing upon the Letter of Credit and applying the Letter of Credit or any part thereof. If Landlord shall draw upon and use, apply or retain the Letter of Credit in whole or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenantpart, Tenant shall within five ten (510) days after written demand by notice from the Landlord restore make such further amended Letter of Credit in form and substance reasonably satisfactory to Landlord as may be necessary to bring the letter balance of credit. Failure the Letter of Credit to so restore said letter a sum equal to the amount of credit within said five (5) days shall the Security Deposit required to be a default by Tenant maintained under this Lease. Partial drawings upon said To the extent not applied by Landlord pursuant to the provisions of the Lease any amount drawn under the Letter of Credit shall be held or applied by Landlord as a Security Deposit. If at any time the Security Deposit is held as cash, then Tenant may thereafter replace the cash security deposit with a letter of credit as set forth above. (b) The Letter of Credit shall be permittedissued and delivered to Landlord within fifteen (15) business days after complete execution of this Lease by Landlord and Xxxxxx. In If Tenant fails to deliver to Landlord the event that Tenant has not been in default under the Lease (beyond the expiration Letter of any applicable cure period) at any time during the Term hereofCredit when required, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments such failure shall constitute an Event of rent due Default under the Lease, then upon . (c) Tenant shall not assign or encumber or attempt to assign or encumber the written request Letter of Tenant, Credit and neither Landlord nor its successors or assign shall be bound by any such assignment or encumbrance or attempted assignment or encumbrance. (d) If Landlord shall authorize be holding the Letter of Credit as security, then, in writing consecutive reductions the event of a proposed sale or lease of the Building by Landlord, Tenant will, upon ten (10) business days' notice, at its sole cost and expense, cause the issuing bank to consent to the principal amount of the assignment or to issue a substitute letter of credit on identical terms except for the stated beneficiary, from the same issuing bank or another bank acceptable to Landlord in Landlord's sole discretion, naming the amount new landlord as the beneficiary thereof upon delivery by Landlord of Thirty Three Thousand Two Hundred Forty-Six Dollars the then outstanding Letter of Credit. ($33,246.00e) each The holder of any mortgage upon the expiration of Building or the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of Lot shall never be responsible to Tenant for the TermSecurity Deposit or its application or return unless the Security Deposit shall actually have been received in hand by such holder.

Letter of Credit. In addition (a) Subject to the Security Deposit terms and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution conditions of this Agreement, the Bank will issue, at the request of the Borrower, a Letter of Credit for the account of the Borrower, in an amount not to exceed $800,000, to secure the Borrower's obligations under the Reston Lease, an irrevocable stand-by letter . The term and form of credit in the amount Letter of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit Credit shall be in form and with subject to the substance of Exhibit F attached heretoBank's approval, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable shall not be unreasonably withheld. (b) Prior to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date issuance of the Term Letter of this LeaseCredit, the Bank must receive an appropriately completed LC Agreement, executed by the Borrower, not less than five Business Days prior to the date on which the Letter of Credit is to be issued. In the event of a conflict between the letter terms of credit is issued with an annual renewal obligation the LC Agreement and the letter terms of credit is not renewed this Agreement, this Agreement shall control. The Borrower agrees to reimburse the Bank on demand for any drawing paid by the issuing financial institution on or before twenty Bank under the Letter of Credit, together with interest thereon from the date of such demand at the Prime Rate per annum plus 2%. (20c) days prior The Borrower agrees to pay a nonrefundable commission with respect to the then-scheduled expiration date Letter of Credit at a rate per annum equal to 1.25% of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full face amount of the letter Letter of credit can Credit, computed on the basis of a 360-day year for the actual number of days for which such Letter of Credit is to be drawn by Landlord pending determination outstanding, which fee shall be due and payable in advance on the date of said amountissuance of the Letter of Credit and each anniversary date thereafter. Notwithstanding The Borrower also shall pay to the foregoingBank a $250 opening fee for the Letter of Credit. (d) The Borrower's obligations under this Section 2.3 shall be absolute and unconditional under any and all circumstances, while the amount irrespective of any set-off, counterclaim or defense to payment that the Borrower may have or have had against the Bank or any beneficiary of the Letter of Credit. The Borrower also agrees with the Bank that the Bank shall not be responsible for, and the Borrower's reimbursement obligations under the Letter of Credit or the LC Agreement shall not be affected by, among other things, the validity or genuineness of any documents or of any endorsements thereon, even though such draw documents shall prove in fact to be invalid, fraudulent or forged, or any dispute between or among the Borrower and any beneficiary of the Letter of Credit or any other party to which the Letter of Credit may be transferred, or any claims whatsoever of the Borrower against any beneficiary of the Letter of Credit or any such transferee, except for errors or omissions caused by the Bank's gross negligence or willful misconduct. The Bank shall not be liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with the Letter of Credit, except for errors or omissions caused by the Bank's gross negligence or willful misconduct. The Borrower agrees that any action taken or omitted by the Bank under or in connection with the Letter of Credit or the related drafts or documents, if done in the absence of gross negligence or willful misconduct and in accordance with the standards of care specified in the UCC, shall be determined binding on the Borrower and shall not result in Landlord’s sole and absolute discretion as provided in any liability of the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant Bank to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermBorrower.

Letter of Credit. In addition to Within ten (10) Business Days following the Security Deposit execution of this Lease by Landlord and as security hereunderTenant, Tenant shall deliver to LandlordLandlord an unconditional, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by and renewable letter of credit (“Letter of Credit”) in favor of Landlord in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit shall be in form and with the substance of attached hereto as Exhibit F attached hereto“I”, and issued by Silicon Valley Bank (or by another financial institution bank reasonably satisfactory to Landlord with a branch located in Orange County Southern California), in the principal amount of Three Hundred Ninety-Three Thousand Six Hundred Eighty-Five and which is acceptable to Landlord. The letter of credit shall either: 47/100 Dollars (i$393,685.47) be issued with a fixed expiration date of December 31(“Stated Amount”), 2005, or (ii) shall provide as security for automatic annual renewals through that date which is sixty (60) days after the Expiration Date faithful performance and observance by Tenant of the Term terms, provisions and conditions of this Lease. In Notwithstanding anything to the event the letter of credit is issued with an annual renewal obligation and the letter of credit contrary contained herein, provided that Tenant is not renewed then in default under the Lease beyond applicable notice and cure periods, the Stated Amount shall be reduced by two-thirds in the amount of $262,457.39 at the end of the twelfth (24th) month of the Lease Term. Landlord agrees to execute any commercially reasonable documentation required by the issuer of the Letter of Credit to effectuate such reductions. Tenant shall pay all expenses, points and/or fees incurred by Tenant in obtaining the Letter of Credit. The Letter of Credit shall state that an authorized officer or other representative of Landlord may make demand on Landlord’s behalf for the Stated Amount of the Letter of Credit, or any portion thereof (based upon a default hereunder beyond all applicable notice and cure periods), and that the issuing financial institution on bank must immediately honor such demand, without qualification or before twenty satisfaction of any conditions, except the proper identification of the party making such demand. In addition, the Letter of Credit shall indicate that it is transferable in its entirety by Landlord as beneficiary and that upon receiving written notice of transfer, and upon presentation to the issuing bank of the original Letter of Credit, the issuer or confirming bank will reissue the Letter of Credit naming such transferee as the beneficiary (20subject to Landlord paying any applicable transfer fees). If the term of the Letter of Credit held by Landlord will expire prior to the last day of the Lease Term and it is not extended, or a new Letter of Credit for an extended period of time is not substituted, within thirty (30) days prior to the then-scheduled expiration date of the letter Letter of creditCredit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by make demand for the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination Stated Amount of said amountLetter of Credit and, thereafter, to hold such funds in accordance with this Section 3.3. Notwithstanding the foregoing, while Landlord acknowledges and agrees that Tenant shall have the amount right, from time to time throughout the Lease Term, to post a substitute Letter of Credit for the Letter of Credit required hereunder that shall meet the requirements of this Section 3.3. The Letter of Credit and any such draw proceeds thereof shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred held by Landlord as security for the result faithful performance by Tenant of all of the terms, covenants and conditions of this Lease. If Tenant commits a default with respect to any provision of this Lease (beyond all applicable notice and cure periods), Landlord may (but shall not be required to) draw upon all or any portion of the Stated Amount of the Letter of Credit, and Landlord may then use, apply or retain all or any part of the proceeds for the payment of any sum which is in default (beyond all applicable notice and cure periods), or for the payment of any other amount which Landlord may spend or become obligated to spend by reason of Tenant’s default (as determined pursuant or to the applicable provisions of Article XIV of this Lease), then compensate Landlord shall promptly refund for any such excess to Tenant. Any such draw shall be without waiver loss or any rights damage which Landlord may have under this Lease or at law or in equity as a result suffer by reason of the default, as a setoff for full or partial compensation for the Tenant’s default. If any portion of the letter Letter of credit is drawn after a default by TenantCredit proceeds are so used or applied, Tenant shall, within ten (10) Business Days after demand therefor, post an additional Letter of Credit in an amount to cause the aggregate amount of the unused proceeds and such new Letter of Credit to equal the Stated Amount required in this Section 3.3. Landlord shall within five (5) days after written demand by not be required to keep any proceeds from the Letter of Credit separate from its general funds. Should Landlord restore sell its interest in the letter Premises during the Lease Term and if Landlord deposits with the purchaser thereof the Letter of credit. Failure to so restore said letter Credit or any proceeds of credit within said five (5) days the Letter of Credit, thereupon Landlord shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of discharged from any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period liability with respect to the Letter of Credit and said proceeds. Any remaining proceeds of the Letter of Credit held by Landlord after expiration of the Lease Term, after any payments of rent due under deductions described in this Section 3.3, shall be returned to Tenant or, at Landlord’s option, to the Lease, then upon the written request last assignee of Tenant’s interest hereunder, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars within thirty ($33,246.0030) each upon days following the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Lease Term.

Letter of Credit. In addition to No later than the Security Deposit and as security hereunderscheduled Commencement Date (unless delayed by Landlord's acts or omissions), Tenant shall deliver to Landlord, concurrently deposit with Tenant’s execution of this Lease, Landlord an unconditional and irrevocable stand-by standby letter of credit in the amount of One Five Hundred Sixty Six Ten Thousand Two Hundred Twenty-Nine and 00/100 Dollars ($166,229.00510.000.00) ("Letter of Credit"), as security for the full and faithful performance of every provision of the Lease to be performed by Tenant pursuant to the terms and conditions set forth in Section 34 hereof. Said letter The Letter of credit Credit shall be made in form favor of Landlord and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall eithershall: (i) be issued with a fixed expiration date of December 31, 2005, or in form and substance acceptable to Landlord in Landlord's reasonable discretion; (ii) shall provide be issued by a national banking association maintaining offices in the United States of America acceptable to Landlord in Landlord's reasonable discretion (the "Bank"); (iii) be available for automatic annual renewals through that date which is sixty (60) days after the Expiration Date draw by Landlord at an office of the Term Bank located in the Seattle area in the State of this LeaseWashington; (iv) be governed by the Internationa] Standby Practices set by the International Chamber of Commerce; (v) permit partial drawings; and (vi) automatically renew on the same terms and conditions so that the Letter of Credit continuously remains in full force and effect for the Term. Landlord confirms that [Bank of America] is acceptable as the Bank and that the form of Letter of Credit attached hereto as Exhibit H is acceptable in form and substance to Landlord, provided, however, Tenant may also use another Bank or form of Letter of Credit that meets Landlord's criteria set forth above. In the event Tenant's operations generate positive cash flow as of each of the letter of credit is issued with dates outlined below (each, an annual renewal obligation and "Adjustment Date"), as evidenced by audited financial statements for the letter of credit is not renewed by the issuing financial institution on or before twenty twelve (2012) days month period prior to the then-scheduled expiration date of the letter of creditapplicable Adjustment Date, then Landlord shall have and Tenant agree to amend the right Letter of Credit to draw decrease the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter Letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while Credit to the amount as outlined below: First day of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount Month 28 $ 306,000.00 First day of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Term.Month 52 $ 102,000.00

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently Concurrently with Tenant’s execution of this Lease, Tenant shall deliver to Landlord an unconditional, irrevocable stand-by and renewable letter of credit (“Letter of Credit”) in favor of Landlord in the form attached hereto as Exhibit “E”, issued by a financial institution approved by Landlord, in the principal amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00). Said letter of credit shall “Stated Amount”) specified below, to be held by Landlord in form and accordance with the substance of Exhibit F attached heretoterms, provisions and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term conditions of this Lease. In Tenant shall pay all expenses, points and/or fees incurred by Tenant in obtaining the event Letter of Credit. If the letter Letter of credit Credit delivered by Tenant is issued inconsistent with an annual renewal obligation and the letter form attached hereto as Exhibit “E” (including, without limitation, the wrong name or address for the Beneficiary), Landlord may so notify Tenant in writing, in which case Tenant shall cause the Letter of credit is not renewed by the issuing financial institution on or before twenty Credit to be corrected within five (205) business days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of after such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Leasenotice. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter the Letter of Credit if the credit rating or financial condition of the issuer of the Letter of Credit is no longer acceptable to Landlord. Following any such draw by Landlord on the issuance Letter of Credit solely because of the deterioration of the creditworthiness of the issuer of the Letter of Credit, Landlord will disburse such Letter of Credit proceeds to Tenant provided (i) Tenant delivers to Landlord a replacement Letter of Credit from a financial institution satisfactory to Landlord in the form attached hereto as Exhibit “E” within sixty (60) days after Landlord’s draw thereon, (ii) there exists no event of default with respect to any provision of this Lease, and (iii) Tenant pays all of Landlord’s sole fees and expenses incurred in connection with such disbursement; provided, however, if any of the three (3) foregoing conditions are not satisfied, the proceeds received from such draw shall constitute Landlord’s property (and not Tenant’s property or the property of the bankruptcy estate of Tenant) and Landlord may then use, apply or retain all or any part of the proceeds for the purposes set forth in clauses (1) through (5) of the next paragraph. The Stated Amount shall initially be […***…]; provided, however, that, except as hereinafter provided, upon the dates specified below (“Adjustment Dates”), the Stated Amount may be reduced to the following amounts: Date Stated Amount December 1, 2011 [...***...] December 1, 2013 [...***...] December 1, 2014 [...***...] However, if (i) an Event of Default by Tenant occurs under this Lease, or (ii) circumstances exist that would, with notice or lapse of time, or both, constitute a default by Tenant, and Tenant has failed to cure such default within the time period permitted by Article 19 or such lesser time as may remain before the relevant Adjustment Date as provided above, the Stated Amount shall not thereafter be reduced unless and until such default shall have been fully cured pursuant to the terms of this Lease, at which time the Stated Amount may be reduced as hereinabove described. The Letter of Credit shall state that an authorized officer or other representative of Landlord may make demand on Landlord’s behalf for the Stated Amount of the Letter of Credit, or any portion thereof, and that the issuing bank must immediately honor such demand, without qualification or satisfaction of any conditions, except the proper identification of the party making such demand. In addition, the Letter of Credit shall indicate that it is transferable in its entirety by Landlord as beneficiary and that upon receiving written demand notice of transfer, and upon presentation to the issuing financial institutionbank of the original Letter of Credit, the issuer or confirming bank will reissue the Letter of Credit naming such transferee as the beneficiary. Such Tenant shall be responsible for the payment to the issuing bank of any transfer costs imposed by the issuing bank in connection with any such transfer. If (A) the term of the Letter of Credit held by Landlord will expire prior to the last day of the Lease Term and the Letter of Credit is not extended, or a new Letter of Credit for an extended period of time is not substituted, in either case at least sixty (60) days prior to the expiration of the Letter of Credit, or (B) Tenant commits a default with respect to any provision of this Lease, including the filing of a voluntary petition under Title 11 of the United States Code (i.e., the Bankruptcy Code), or otherwise becomes a debtor in any case or proceeding under the Bankruptcy Code, as now existing or hereinafter amended, or any similar law or statute, Landlord may (but shall not be required to) draw upon all or any portion of the Stated Amount of the Letter of Credit, and the proceeds received from such draw shall be constitute Landlord’s property (and not Tenant’s property or the property of the bankruptcy estate of Tenant) and Landlord may then use, apply or retain all or any part of the proceeds (1) for the payment of any sum which is in an default, (2) to reimburse Landlord for costs incurred by Landlord in connection with this Lease (including, without limitation, any costs incurred by Landlord to improve the Premises, any Improvement Allowance, and any brokerage commissions and attorneys’ fees), (3) for the payment of any other amount necessary which Landlord may spend or become obligated to cure the default in question and spend by reason of Tenant’s default, (4) to compensate Landlord for all damages incurred thereby, as determined any loss or damage which Landlord may suffer by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result reason of Tenant’s default or (5) as determined pursuant prepaid rent to be applied against Tenant’s Basic Rental obligations for the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result last month of the default, as a setoff for full or partial compensation for Term and the defaultimmediately preceding month(s) of the Term until the remaining proceeds are exhausted. If any portion of the letter Letter of credit is drawn after a default by TenantCredit proceeds are so used or applied, Tenant shall shall, within five ten (510) days after written demand by therefor, post an additional Letter of Credit in an amount to cause the aggregate amount of the unused proceeds and such new Letter of Credit to equal the Stated Amount required in this Article 4 above. Landlord restore shall not be required to keep any proceeds from the letter Letter of creditCredit separate from its general funds. Failure to so restore said letter Should Landlord sell its interest in the Premises during the Lease Term and if Landlord deposits with the purchaser thereof the Letter of credit within said five (5) days Credit or any proceeds of the Letter of Credit, thereupon Landlord shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of discharged from any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period liability with respect to the Letter of Credit and said proceeds and Tenant shall look solely to such transferee for the return of the Letter of Credit or any payments proceeds therefrom. The Letter of rent due under Credit or any remaining proceeds of the LeaseLetter of Credit held by Landlord after expiration of the Lease Term, then upon after any deductions described in this Article 4 above, shall be returned to Tenant or, at Landlord’s option, to the written request last assignee of Tenant’s interest hereunder, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars within sixty ($33,246.0060) each upon days following the expiration of the twelfth (12th)Lease Term. The use, twenty-fourth (24th)application or retention of the Letter of Credit, thirty-sixth (36th)the proceeds or any portion thereof, shall not prevent Landlord from exercising any other rights or remedies provided under this Lease, it being intended that Landlord shall not be required to proceed against the Letter of Credit, and forty-eighth (48th) months such use, application or retention of the TermLetter of Credit shall not operate as a limitation on any recovery to which Landlord may otherwise be entitled. No trust relationship is created herein between Landlord and Tenant with respect to the Letter of Credit. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit, any renewal thereof or substitute therefor or the proceeds thereof be deemed to be or treated as a “security deposit” or intended to serve as a “security deposit”.

Letter of Credit. In addition to Within fourteen (14) days of the Security Deposit and as security hereunder, Lease Execution Date Tenant shall deliver to Landlord an unconditional, irrevocable and transferable letter of credit, naming Landlord and its successors and assigns as beneficiary, in the amount of Three Hundred Thousand U.S. Dollars ($ 300,000.00) (the "Letter of Credit"), which shall be held by Landlord or its agent, as security, for the full and faithful performance of Tenant's obligation herewith. The Letter of Credit shall be issued by a commercial bank headquartered in the continental United States of America (or other bank satisfactory to and approved by Landlord) which has capital assets of at least $1,000,000,000 and capital reserves of at least $250,000,000, concurrently and which is a member of the Federal Reserve System ("Issuing Bank"). Upon the occurrence of any default by Tenant hereunder, Tenant agrees that Landlord may from time to time, without prejudice to any other remedy, make demand for the principal amount of the Letter of Credit to the extent necessary to make good any damage, injury, expense incurred by Landlord by virtue of such default and/or to pay any damages payable to Landlord by virtue of such default, and may thereafter apply such proceeds to any such damage, injury or expense. Tenant shall not have the right to call upon Landlord to draw upon the Letter of Credit to cure any default or fulfill any obligation of Tenant, but such use shall be solely in the discretion of Landlord. Upon any conveyance of the Premises by Landlord to Landlord's grantee or transferee, the Letter of Credit thereon may be assigned by Landlord to Landlord's grantee or transferee and Tenant shall cooperate to the extent necessary to effect such assignment. Upon any such assignment, Tenant hereby releases Landlord herein named of any and all liability with respect to the Letter of Credit, its application and return, and Tenant agrees to look solely to such grantee or transferee. It is further understood that this provision shall also apply to subsequent grantees and transferees. In addition, Landlord shall return the Letter of Credit to Tenant within thirty (30) days after the expiration of the initial Term of this Lease or the termination of this lease provided that at such time there exists no breach of any undertaking of Tenant’s execution . In the event that the Issuing Bank closes or threatens to close during the Term, Tenant shall immediately deliver a letter of credit to replace the Letter of Credit (if then held by Landlord) (the "Original Letter of Credit"), which letter of credit (the "Substitute Letter of Credit") shall be identical in form and substance to the Original Letter of Credit unless Landlord in its sole but reasonable discretion approves any discrepancies. The Substitute Letter of Credit shall be issued by a commercial bank headquartered in the continental United States of America (or other bank satisfactory to and approved by Landlord) which has capital assets of at least $1,000,000,000 and capital reserves of at least $250,000,000, and which is a member of the Federal Reserve System. Tenant's failure to deliver the Substitute Letter of Credit to Landlord within fifteen 15 business days of written demand from Landlord shall constitute a material breach and default hereunder, which shall entitle Landlord to exercise any of the rights and remedies set forth in this Lease. Furthermore, if the Letter of Credit or Substitute Letter of Credit, as the case may be, has an expiration date that occurs prior to the date which is thirty (30) days after the expiration of the initial Term of this Lease, an irrevocable stand-by letter and the Landlord receives notice that the Letter of credit in Credit or Substitute Letter of Credit, as the case may be, will not be extended beyond such expiration date, Landlord may draw upon the full amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00)the Letter of Credit or Substitute Letter of Credit, as the case may be, and thereafter hold such amount as a security deposit otherwise subject to the terms hereof, for the full and faithful performance of Tenant's obligation herewith or Landlord may hold Tenant in default of it's obligations under this lease and pursue all of its remedies under said lease. Said letter Upon the request of credit Landlord, from time to time, Tenant shall make arrangements satisfactory to Landlord in its reasonable discretion for the transfer of any Letter of Credit to any successor landlord or mortgagee of the Property, and from any such mortgagee to Landlord or any successor mortgagee. Any security deposit held by Landlord or its agent, as security, for and during the Term, shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable returned to Landlord. The letter of credit shall either: Tenant within thirty (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (6030) days after the Expiration Date expiration of the Term or the termination of this Leaselease provided there exists no breach of any undertaking of Tenant. In Upon the event the letter occurrence of credit is issued with an annual renewal obligation and the letter of credit is not renewed any default by the issuing financial institution on Tenant hereunder, Tenant agrees that Landlord may apply all or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as any part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoingtogether with accrued interest, if the amount any, thereon to any obligation of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the defaultTenant hereunder. If all or any portion of the letter security deposit is applied to any obligation of credit is drawn after a default by TenantTenant hereunder, Tenant shall within five (5) days after written demand immediately upon request by Landlord restore the letter security deposit to its original amount. Tenant shall not have the right to call upon Landlord to apply all or any part of credit. Failure the security deposit to so restore said letter cure any default or fulfill any obligation of credit within said five (5) days Tenant, but such use shall be a default solely in the discretion of Landlord. Upon any conveyance of the Premises by Landlord to Landlord's grantee or transferee, the security deposit together with accrued interest, if any, thereon may be delivered by Landlord to Landlord's grantee or transferee. Upon any such delivery, Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration hereby releases Landlord herein named of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period all liability with respect to any payments of rent due under the Leasesecurity deposit, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th)its application and return, and forty-eighth (48th) months of the TermTenant agrees to look solely to such grantee or transferee.

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars $50,593.00 ($166,229.00the “Letter of Credit”). Said letter Letter of credit Credit shall be in form and with the substance of Exhibit F I attached heretohereto (or in other form and substance acceptable to Landlord), and issued by Silicon Valley Bank or by another a financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default “Default” by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodTenant (as hereinafter defined), Landlord shall be entitled to draw upon said letter Letter of credit Credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such , which draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter Letter of credit Credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV 14 of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter Letter of credit Credit is drawn after a default by Tenant, Tenant shall within five (5) 5 business days after written demand by Landlord restore the letter Letter of creditCredit. Failure to so restore said letter Letter of credit Credit within said five (5) 5 business days shall be a default by Tenant under this Lease. Partial drawings upon said letter Letter of credit Credit shall be permitted. The Letter of Credit shall provide for automatic annual renewals through that date which is 60 days after the Expiration Date of the Term of this Lease (including any extensions of the Term as provided in this Lease). In the event that Tenant has the Letter of Credit is not been in default under renewed by the Lease (beyond issuing financial institution on or before 30 days prior to the then-scheduled expiration date of any applicable cure period) at any time during the Term hereofLetter of Credit, then Landlord shall have the right to draw the full amount of such Letter of Credit and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments hold such amount as cash security for Tenant’s full and faithful performance of rent due its obligations under the Lease. In the event of a draw down of the Letter of Credit to cash security as provided in the foregoing, then the following shall apply: (i) upon any Default by Tenant under this Lease, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.2 below, in its sole and absolute discretion and notwithstanding any contrary provision of California Civil ode Section 1950.7, retain, use or apply the written request whole or any part of such cash security to pay any sum which Tenant is obligated to pay under this Lease, including without limitation, amounts estimated by Landlord as the amounts due it for prospective rent and for damages pursuant to Section 14.2(a)(i) of this Lease and/or California Civil Code Section 1951.2, sums that Landlord may spend or be required to expend by reason of the default by Tenant or any loss or damage that Landlord may suffer by reason of such default or costs incurred by Landlord in connection with the repair or restoration of the Premises pursuant to Section 15.2 upon expiration or earlier termination of this Lease, (ii) Landlord shall not be required to keep the cash security separate from its general funds and Tenant shall not be entitled to interest on such cash security, and (iii) if Tenant fully performs its obligations under this Lease, the cash security shall be returned to Tenant (or, at Landlord’s option, to the last assignee of Tenant, Landlord shall authorize in writing consecutive reductions to ’s interest under the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars Lease) within thirty ($33,246.0030) each upon days after the expiration of the twelfth (12th)Term, twenty-fourth (24th), thirty-sixth (36th), provided that Tenant agrees that Landlord may retain the cash security to the extent and forty-eighth (48th) months of until such time as all amounts due from Tenant in accordance with this Lease have been determined and paid in full and Tenant agrees that Tenant shall have no claim against Landlord for Landlord’s retaining the Termcash security to the extent provided in the foregoing.

Letter of Credit. In addition to A. On or before the Security Deposit and as security hereunderCommencement Date, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, Landlord an executed original irrevocable stand-by standby letter of credit ("L.C.") in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty$125,000 in favor of Landlord, such L.C. to have a term of one hundred twenty-Nine Dollars three ($166,229.00)123) months from the Commencement Date of the Lease. Said letter The L.C. may be drawn upon and used upon each occurrence of credit an event of default; Landlord may use all or part of the L.C. to pay past due rent or other payments due Landlord under this Lease, and the cost of any other damage, injury, expense or liability caused by such event of default without prejudice to any other remedy provided herein or provided by law. Such L.C. shall be issued in a form and with by a National Banking Association (located within the substance continental United States of Exhibit F attached heretoAmerica) (hereinafter the "Issuer"), and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after With respect to any default occurring during the Expiration Date term of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw proceed against the full amount total L.C. at the sole discretion of such letter of credit Landlord regarding items and the amounts to hold such amount as part of the Security Deposit pursuant be drawn upon relating to Section 4.3 of this Lease. Upon any default by Tenant. If Tenant exercises either its extension option under Paragraph 31 herein, then Tenant agrees that the L.C. will be extended in the same amount and under the same terms for any additional term of this Lease. B. Such L.C. shall contain the following terms and conditions: (1) The L.C. shall be deemed to be automatically extended without amendment from year to year, with renewal occurring annually from the date of its issuance or any future expiration date unless at least 30 days prior to any future expiration date the bank notifies Landlord, in writing, by certified mail, return receipt requested, that the issuer intends not to renew the L.C. for an additional year. (2) In the event the L.C. will not be extended and has or will expire by its terms and the Lease Agreement, by and between Tenant and Landlord, including specifically Tenant’s failure to pay rent any or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodall extensions or renewals, has not expired, then Landlord shall be entitled allowed to draw draft upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord Issuer for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter L.C. (3) The L.C. shall be subject to the "Uniform Customs and Practices for Documentary Credits (1994 Revision), International Chamber of credit can Commerce Publication No. 400." (4) The amount of the L.C. shall be drawn by payable at sight to Landlord pending determination within three (3) days of said amount. Notwithstanding presentation of the foregoingsight draft, while in whole or partial drawings, upon presentation to the Issuer of the following documents: a. Landlord's written demand for payment making reference to the date and number of the L.C.; b. Landlord's signed certificate that the amount drawn is to meet any event of any such draw shall be determined in Landlord’s sole and absolute discretion default as provided set forth in the foregoing, Lease Agreement by and between Tenant and Landlord; and c. The original L.C. for endorsement of the amount paid and if the draft is for the full amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant L.C. is to be surrendered to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five Issuer. (5) days after written demand The Issuer shall not have the right to assign the L.C. to any other person, entity, National Banking Association, or financial institution without Landlord's consent which shall not be unreasonably withheld. (6) Any presentment by Landlord restore of the letter of credit. Failure to so restore said letter of credit within said five (5) days L.C. for the payment shall be made at a default by national banking association located within the continental United States of America. (7) The Issuer shall not modify the L.C. without the prior written consent of Landlord. (8) Landlord shall have the right to assign and transfer its right and interests in the L.C. to any other beneficiary/party acceptable to Landlord. C. The Landlord will return the L.C. to the Tenant under this Lease. Partial drawings upon said letter if Tenant performs all of credit shall be permitted. In the event that following obligations: (1) Tenant has not been in default under the Lease (beyond the expiration meets all of any applicable cure period) at any time during the Term hereofits annual revenue projections through December 1999 as set forth on Exhibit "D" attached hereto, and provided further that (2) Tenant's annual revenue projections through December 1999 as set forth on Exhibit D are verified in the annual 10-K filed with the Security Exchange Commission. At no time shall the L.C. be returned to Tenant has not unless Tenant meets the requirements set forth in the preceding sentence. 58 Dallas County and corrected by Certificate of Correction in Volume 77247, Page 0005, Deed Records of Dallas County, and being more particularly described as follows: BEGINNING at any time been more than five the intersection of the North line of Tract "K-1" (5a 50 foot private R.O.W. easement) days late more than once during and the applicable previous twelve (12)-month period with respect East right-of-way line of Hurd Xxxve; THENCE leaving Hurd Xxxve South 73(degree) 07' 00" East 22.28 feet along the North line of said Tract "K-1" to any payments a point for a corner; said point being the point of rent due under the Lease, then upon the written request curvature of Tenant, Landlord shall authorize in writing consecutive reductions a curve to the principal amount left with a central angle of 17(degree) 09' 40" and a radius of 739.65 feet; THENCE with said curve to the letter left 221.54 feet to the point of credit tangency of said curve; THENCE continuing along the North line of Tract "K-1" North 89(degree) 43' 20" East 360.24 feet to a point for a corner; said point being the Southwest corner of an 8.019 acre tract conveyed by Las Colinas Corporation to E.I. XxXxxx XxXemours and Company, Inc., as recorded in Volume 78012, Page 0685, Dallas County Deed Records, January 17, 1978; THENCE leaving the North line of Tract "K-1" North 00(degree) 16; 40" West 303.43 feet along the western boundary line of said 8.019 acre tract to a point for a corner; THENCE continuing along the western boundary line of said 8.019 acre tract, North 44(degree) 46' 50" West 266.16 feet to a point for a corner; said point being in the amount East right-of-way line of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00Hurd Xxxve; said point also being the Northwest corner of said 8.019 acre tract; THENCE along Hurd Xxxve South 45(degree) each upon 13' 10" West 439.00 feet to a point for a corner; said point being the expiration point of curvature of a curve to the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), left with a central angle of 28(degree) 20' 45" and forty-eighth (48tha radius of 461.14 feet; THENCE Southwesterly along Hurd Xxxve with said curve to the left through a central angle of 22(degree) months 08' 10" a distance of 178.16 feet to the TermPOINT OF BEGINNING.

Letter of Credit. In addition If, at any time following the Telaprevir Approval, Tenant has an unrestricted cash, cash equivalent and marketable securities balance of [***], as determined in accordance with generally accepted accounting principles, consistently applied (the “Financial Standard”) then Tenant shall provide to the Security Deposit and Landlord as security hereunder, for the performance of the obligations of Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by hereunder a letter of credit in the amount specified in Section 1.13 in accordance with this Section (as renewed, replaced, and/or reduced pursuant to this Section, the “Letter of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00Credit” ). Said letter The Letter of credit Credit shall be in the form attached as Exhibit 17.01 to this Lease or such other form as Landlord may reasonably approve. If there is more than one Letter of Credit so delivered by Tenant, such Letters of Credit shall be collectively hereinafter referred to as the “Letter of Credit”. The Letter of Credit (i) shall be irrevocable and shall be issued by a commercial bank reasonably acceptable to Landlord that has an office in Boston, Massachusetts, (ii) shall require only the presentation to the issuer of a certificate of the holder of the Letter of Credit stating either (a) that Landlord is entitled to draw on the Letter of Credit in accordance with this Lease or (b) that Tenant has not delivered to Landlord a new Letter of Credit having a commencement date immediately following the expiration of the existing Letter of Credit in accordance with the requirements of this Lease, (iii) shall be payable to Landlord and its successors in interest as the Landlord and shall be freely transferable at nominal cost, (iv) shall be for an initial term of not less then one year and contain a provision that such term shall be automatically renewed for successive one-year periods unless the issuer shall, at least sixty (60) days prior to the scheduled expiration date, give Landlord written notice of such nonrenewal, and (v) shall otherwise be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is reasonably acceptable to Landlord. The letter Notwithstanding the foregoing, the term of credit the Letter of Credit for the final period of the Term shall either: (i) be issued with for a fixed expiration term ending not earlier then the date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date last day of the Term Term. If (x) Tenant shall be in default under this Lease, after the expiration of any applicable notice or cure period (or if transmittal of a default or other notice is stayed or barred by applicable bankruptcy or other law); (y) not less then thirty (30) days before the scheduled expiration of the Letter of Credit, Tenant has not delivered to Landlord a new Letter of Credit having a commencement date immediately following the expiration of the existing Letter of Credit in accordance with this Section; or (z) (i) the credit rating of the long-term debt of the issuer of the Letter of Credit (according to Xxxxx’x, Standard & Poor’s or similar national rating agency reasonably identified by Landlord) is downgraded to a grade below investment grade; or (ii) the issuer of the Letter of Credit enters into any supervisory agreement with any governmental authority; or (iii) the issuer of the Letter of Credit fails to meet any capital requirements imposed by applicable law, then, in any of such events under this clause (z), unless Tenant delivers to Landlord a replacement Letter of Credit complying with the terms of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty Lease within ten (2010) days prior to the then-scheduled expiration date of the letter of creditafter demand therefor from Landlord, then Landlord shall have the right to draw upon the Letter of Credit in full amount or in part without giving any further notice to Tenant. Such failure to timely deliver a new Letter of such letter of credit and to hold such amount as part of the Security Deposit Credit pursuant to this Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord 17.01 shall be entitled deemed to draw upon said letter be an Event of credit Default by Tenant (without the issuance necessity of Landlord’s sole written demand further notice or cure period notwithstanding anything in this Lease to the issuing financial institutioncontrary). Such draw Landlord may, but shall not be in an obligated to, apply the amount so drawn to the extent necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant and/or any other damages to the applicable provisions of Article XIV of this Lease), then which Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant entitled under this Lease. Partial drawings upon said letter Any funds drawn by Landlord on the Letter of credit Credit and not applied against amounts due hereunder shall be permittedheld by Landlord as a cash security deposit, provided that Landlord shall have no fiduciary duty with regard to such amounts, shall have the right to commingle such amounts with other funds of Landlord, and shall pay no interest on such amounts. In After any application of the event that Letter of Credit against amounts due hereunder by Landlord in accordance with this paragraph, Tenant has not been in default under shall reinstate the Lease Letter of Credit to the amount then required to be maintained hereunder, within thirty (beyond 30) days of demand. Within sixty (60) days after the expiration or earlier termination of any applicable cure period) at any time during the Term hereofthe Letter of Credit and any cash security deposit then being held by Landlord, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount extent not applied, shall be returned to Tenant provided that no default of which Tenant then has notice (to the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00extent that such notice is required) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termis then continuing.

Letter of Credit. In addition to the Security Deposit and cash security deposit required pursuant to the terms of Section 32 of the Lease, as security hereunderadditional security, Tenant shall deliver to Landlord, Landlord concurrently with Tenant’s the execution of this Leasethe Lease by Tenant, an irrevocable stand-by irrevocable, unconditional letter of credit in the amount equal to $1,500,000.00 (which the parties agree is a reasonable estimate of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars the Transaction Costs ($166,229.00the “Letter of Credit”). Said letter The Letter of credit Credit shall be addressed to Landlord (and/or any other beneficiary designated by Landlord), issued in a form and with the substance of Exhibit F attached heretoapproved by Landlord in Landlord’s sole discretion and by a financial institution approved by Landlord in Landlord’s sole discretion, and issued shall be transferable one or more times by Silicon Valley Bank or Landlord without the consent of Tenant. In the event that the term of the Letter of Credit obtained by another financial institution located in Orange County and which Tenant is acceptable less than the Term of the Lease, Tenant shall provide to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after prior to the Expiration Date expiration of the term of the Letter of Credit, a substitute Letter of Credit, in form, scope, and substance satisfactory to Landlord, all in its sole discretion, for the duration of the Term of the Lease plus 30 days. Tenant agrees to pay upon Landlord’s request, any and all costs or fees charged in connection with the Letter of Credit that arise due to: (i) Landlord’s sale or transfer of all or any portion of the Building; or (ii) the addition, deletion, or modification of any beneficiary under the Letter of Credit. The bank issuing the Letter of Credit shall have banking offices in the city in which the Building is located, at which offices the Letter of Credit may be drawn. Tenant agrees that upon any default by Tenant under the terms and provisions of this Lease. In , including the event the letter failure of credit is issued with an annual renewal obligation and the letter Tenant to timely deliver any replacement Letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of creditCredit, then Landlord shall have the right to draw receive payment under any Letter of Credit of the full entire amount of such Letter of Credit at such time, and any such amounts received by Landlord shall be held by Landlord and applied to any default hereunder in such manner as Landlord deems appropriate. Subject only to the provisions set forth in the following sentences, Landlord shall at all times during the Term, hold a letter of credit and to hold such amount as part of in the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amountamounts described above. Notwithstanding the foregoing, while and provided that between the date of this Lease and the applicable Reduction Date (hereinafter defined): (a) there has been no default on the part of Tenant under the terms of the Lease; and (b) there has been no assignment of the Lease, subletting of the Premises or any portion thereof, or any other action on the part of the Tenant which would constitute a transfer as provided in Section 17 of the Lease (the items referred to in (b) being referred to collectively as a “Transfer” and the conditions set forth in (a) and (b) being referred to as the “Conditions”), on the first anniversary date of the Commencement Date and each anniversary date thereafter (each, a “Reduction Date”), the Letter of Credit shall be reduced by an amount equal to one-tenth (1/10th) of the amount of any such draw the original Letter of Credit. In connection therewith, provided that as of each applicable Reduction Date the Conditions shall have remained satisfied, Tenant shall be determined in Landlord’s sole entitled to replace the then current Letter of Credit with a replacement Letter of Credit which shall meet all of the requirements set forth above, except as to amount, and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount replacement Letter of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw Credit shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the defaultreduced accordingly. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereofa Transfer occurs, Tenant shall no longer be entitled to any further reductions in the amount of the then-existing Letter of Credit, and provided further that Tenant has not at any time been more than five (5) days late more than once during in addition, as a condition to entering into the applicable previous twelve (12)-month period Transfer, and without otherwise modifying Landlord’s rights with respect to any payments such Transfer as more fully set forth in Section 17 of rent due under the this Lease, then upon Tenant shall be required to replace the written request then-existing Letter of Tenant, Landlord shall authorize Credit with a Letter of Credit in writing consecutive reductions the original amount equal to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermTransaction Costs.

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently (a) Concurrently with Tenant’s its execution of this Lease, Tenant will obtain and deliver to Landlord an irrevocable stand-by irrevocable, clean, unconditional standby letter of credit in accordance with the terms and conditions of this Section 24.17 (the “Letter of Credit”). The Letter of Credit will be in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Fifty Thousand Dollars ($166,229.00250,000), will be issued initially by Fleet Bank, or if Tenant wishes or is required to replace the initial Letter of Credit, by a bank that meets the criteria in Section 24.17(d). Said letter The Letter of credit shall be in form Credit will name the then-current Landlord (or, at Landlord’s request from time to time, one or more then-current lenders to Landlord) as the beneficiary thereof, will have an initial term of at least one (1) year, will renew automatically unless Landlord receives written notice from the issuer at least thirty (30) days prior to its expiration, and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is will expire no earlier than sixty (60) days after the Expiration Date expiration date of the Term of this Lease. In Tenant will renew or replace the event the letter Letter of credit is issued Credit in accordance with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty this Section 24.17 at least thirty (2030) days prior to the then-scheduled expiration date its expiration. The form and content of the letter Letter of credit, then Landlord shall Credit will be as set forth in this Section 24.17 and otherwise as may be acceptable to the beneficiary thereof. The beneficiary will have the right to draw under the full amount Letter of Credit on one or more occasions from time to time (either total or partial draws) and in accordance with the terms hereof simply upon presentation to the issuer of a sight draft executed by the beneficiary or its authorized representative requesting payment and without further condition or certification, and the issuer will pay upon presentation of such letter draft without deduction or offset of credit any type. The Letter of Credit will be assignable in whole but not in part, and at Landlord’s request from time to hold such amount as part time, it will be reissued in favor of a new beneficiary in accordance with the Security Deposit pursuant to Section 4.3 terms of this Lease. Upon any default by Tenant, including specifically Tenant’s failure . (b) If Tenant defaults or fails to pay rent or perform its Liabilities under this Section 24.17 or the rest of this Lease as and when required (including, without limitation, failing to abide by its obligations renew or replace the Letter of Credit as and when required), the beneficiary thereafter may, but will not be obligated to, draw under Sections 7.1 the Letter of Credit on one or more occasions and 15.3 below and Tenant’s failure hold or apply the proceeds thereof to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all amounts owed and/or damages incurred thereby, or resulting therefrom and/or in such other manner or order as determined by Landlord the beneficiary may determine in its sole and absolute discretion, and if such amount canthe beneficiary’s draw(s) under or failure to draw down all or any portion of the Letter of Credit in any particular instance will not be readily determined by deemed to be a waiver or election of any rights and remedies of any type of Landlord or the beneficiary, a limitation on Landlord’s or the beneficiary’s right to damages or the amount thereof, then the full amount a payment of the letter of credit can be drawn by Landlord pending determination of said amountliquidated damages or an accord or satisfaction. Notwithstanding the foregoing, while the amount beneficiary may not apply the proceeds of the Letter of Credit in amounts materially in excess of the damages actually or reasonably expected to be incurred by the beneficiary (but the parties specifically agree that the beneficiary’s rights to draw under and/or apply the proceeds of the Letter of Credit will not be subject to any such draw shall be determined in Landlord’s sole and absolute discretion as provided stays, “caps” or limitations on damages in the foregoing, if the amount Bankruptcy Code or otherwise affected by an Event of any such draw(sBankruptcy). (c) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter Letter of credit Credit is drawn after a default by Tenanton, Tenant shall will within five ten (510) days after written demand by notice either: deposit cash with Landlord restore so that the letter combination of creditcash and the undrawn portion of the Letter of Credit equal the original amount of the Letter of Credit; or cause the Letter of Credit to be reinstated or reissued so that the amount thereof equals the original amount of the Letter of Credit. Failure to so restore said letter If the Letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant Credit has not been drawn on and Tenant is not in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not committed an act or omission that with the passage of time or the giving of notice (or both) would constitute a default, Tenant may at any time been more than five (5) days late more than once during its cost reduce the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal face amount of the letter Letter of credit in the amount of Thirty Three Credit to One Hundred Twenty-five Thousand Two Hundred Forty-Six Dollars ($33,246.00125,000) each upon if prior thereto: (i) Tenant has met the expiration following financial criteria for one full calendar year: revenue (excluding venture or other funding) of at least $73.8 Million; cost of goods sold not exceeding 29% of revenue; operating expenses not exceeding 38% of revenue; and operating income of at least $25 Million and at least 34% of revenue; and (ii) Tenant delivers to Landlord: financial statements prepared in accordance with GAAP and audited by an independent certified public accountant showing that these financial criteria have been met; and an unconditional written certification from such accountant and Tenant’s President or CFO certifying that these financial criteria have been met. (d) Tenant will promptly cause the Letter of Credit to be replaced by a Letter of Credit issued by another recognized United States money-center bank in good standing with a branch located in the Boston, Massachusetts metropolitan area of the twelfth United States that meets the financial criteria described below and is otherwise reasonably acceptable to the beneficiary: (12th)i) on demand by the beneficiary if the issuer ever fails to meet the financial criterion described below; or (ii) if Tenant wishes to replace the Letter of Credit with a Letter of Credit issued by another bank. The financial criteria referred to above are the issuer’s maintenance of credit quality ratings from Fitch, twenty-fourth (24th)Inc., thirty-sixth (36th), Xxxxx’x and forty-eighth (48th) months Standard & Poor’s at least equal to those enjoyed by the initial issuer of the TermLetter of Credit when the Letter of Credit was initially issued. Tenant will be responsible for documenting such compliance if required. The beneficiary will have the immediate right thereon and thereafter to draw under the Letter of Credit for all or any portion thereof if the Letter of Credit is not replaced as and when required by an issuer meeting the financial criterion referred to above. Tenant will be solely responsible for all costs in connection with any issuance, reissuance, reinstatement, assignment, modification, transfer or renewal of the Letter of Credit in accordance with this Section.

Letter of Credit. In addition (a) The Company shall arrange for a Letter of Credit and may, at its option, arrange for a Substitute Letter of Credit to be in effect with such terms and conditions as required under Section 5.6(b) of the Indenture. Any Substitute Letter of Credit to be effective upon the termination of the Letter of Credit or any extension of the Letter of Credit shall be delivered to the Security Deposit Trustee at least 60 days prior to the date upon which the Letter of Credit terminates according to its terms, and as security hereunderthe terms of the Indenture. (b) On any Interest Payment Date, Tenant the Company may, at its option, provide for the delivery to the Trustee of a Substitute Letter of Credit relating to the Series 1990A Bonds. Such Substitute Letter of Credit shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, be an irrevocable stand-by letter of credit with a term of at least one year, issued by a commercial bank, the terms of which shall in all material respects be the same as the Letter of Credit except that the termination date of such Substitute Letter of Credit may be later than August 8, 1995. On or prior to the date of delivery of a Substitute Letter of Credit to the Trustee, the Company shall furnish to the Trustee (i) an opinion of Bond Counsel stating that the delivery of such Substitute Letter of Credit to the Trustee is lawful under applicable law and permitted under this Agreement and complies with the terms hereof and that the delivery of such Substitute Letter of Credit does not adversely affect the exemption from federal income taxation of interest on any of the series 1990A Bonds and (ii) written evidence from Moody's, if the Series 1990A Bonds are rated by Moody's, and S&P, if the Series 1990A Bonds are rated by S&P, in each case to the effect that such rating agency has reviewed the proposed Substitute Letter of Credit and that the substitution of the proposed Substitute Letter of Credit for the Letter of Credit will not, by itself, result in a reduction or withdrawal of its ratings of the Series 1990A Bonds from those which then prevail. (c) The Company may, at its option, provide for the delivery to the Trustee of an Alternate Credit Facility as described in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars next succeeding sentence. "Alternate Credit Facility" means ($166,229.00). Said i) a letter of credit shall be which does not conform to the requirements for a Substitute Letter of Credit, but which is sufficient in form and with the substance of Exhibit F attached heretoamount to pay, and issued by Silicon Valley Bank or by another financial institution located in Orange County bearing terms sufficient to provide for the payment of, the principal of, and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration premium, if any, and interest on all Series 1990A Bonds remaining Outstanding upon the effective date of December 31, 2005, thereof or (ii) such other credit facility as the Company shall provide for automatic annual renewals through select to evidence or secure the Company's obligation under the Agreement; provided that date which is sixty (60) days after in any such case the Expiration Date administrative provisions of such Alternate Credit Facility are reasonably satisfactory to the Term of this LeaseTrustee. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on On or before twenty (20) days prior to the then-scheduled expiration date of delivery of any Alternate Credit Facility to the letter Trustee, the Company shall furnish to the Trustee and the Issuer an opinion of credit, then Landlord shall have Bond Counsel stating that the right to draw the full amount delivery of such letter Alternate Credit Facility to the Trustee is lawful under applicable law and permitted under this Agreement and complies with the terms hereof and that the delivery of credit and to hold such amount as part Alternate Credit Facility will not adversely affect the exemption from federal income taxation of the Security Deposit pursuant to interest on the Series 1990A and, at the Company's option, written evidence from one or more rating agencies as described in Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount 5.7 of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermIndenture.

Letter of Credit. In addition (a) Provided Tenant is not in default beyond applicable grace and notice periods, Tenant shall have the right to substitute the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by "evergreen" letter of credit (the "Letter of Credit") or deposit the Letter of Credit in the amount of One $120,561.00 as Security Deposit as security for the full and faithful performance and observance by Tenant of Tenant's covenants and obligations under this Lease. (b) The Letter of Credit shall be clean, unconditional and irrevocable, issued by a commercial bank which is a member of the New York Clearing House Association and having assets of not less than Five Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars Million ($166,229.00500,000,000) Dollars and shall be payable to Landlord upon presentation solely of a sight draft and written certification by an officer or agent of Landlord to the issuer of the Letter of Credit stating that (a) Tenant has defaulted in performance of its obligations under the Lease beyond applicable notice and grace periods, and (b) Landlord is entitled, pursuant to this Lease to draw the amount set forth in such draft. The Letter of Credit shall be payable in multiple drafts, shall be for a period expiring no earlier than one (1) year after its issuance date, shall provide that the term thereof shall automatically renew from time to time for (1 ) year periods, until the day that is the Lease Expiration Date (unless the issuing bank shall give written notice of such non-renewal to Landlord not later than thirty (30) days preceding the expiration date of such Letter of Credit), and shall be transferable by the beneficiary without additional charge assessed to Landlord or such assignee. Said The form and content of the Letter of Credit shall be subject to Landlord's approval. If Landlord receives notice that the Letter of Credit will not be renewed, Landlord may draw upon the full amount of the Letter of Credit and hold as cash hereunder. (c) In the event of any default by Tenant beyond any notice and applicable grace period, Landlord may draw upon the Letter of Credit, in whole or in part, to cure the default or to reimburse Landlord for any sum which Landlord may spend by reason of the default. In the case of any such drawing upon the Letter of Credit, Tenant shall deposit with Landlord a supplemental or new letter of credit meeting the same requirements set forth in Section (B) hereof, such that the total of all letters of credit issued on behalf of Tenant and then held by Landlord pursuant to this Article shall not be in less than an amount equal to the then Security Deposit. (d) The Letter of Credit must be an "evergreen" form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: which by its terms must provide, in part, that it be able to be automatically extended for an additional period of one year from the present or any future expiration date. (ie) be issued with a fixed expiration date If Landlord has not drawn upon the Letter of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after Credit at the Expiration Date bate of the Term Lease, the Letter of this Lease. In the event the letter Credit and/or any supplemental Letters of credit is issued with an annual renewal obligation and the letter of credit is not renewed Credit then held by the issuing financial institution on or before Landlord shall be returned to Tenant within twenty (20) days prior to the then-scheduled expiration date thereafter. (f) Upon acceptance and approval of the letter Letter of creditCredit, then Landlord shall promptly return the Tenant's Security Deposit. (g) In the event of a sale or lease of the Building, Landlord shall have the right to draw transfer the full amount Letter of Credit to the vendee or lessee and Landlord shall ipso facto be released by Tenant from all liability for the return of such letter security except for Landlord's wilful misconduct or gross negligence Tenant agrees to look solely to the new Landlord for the return of credit said security and it is agreed that the provisions hereof shall apply to hold such amount as part every transfer or assignment made of the Security Deposit pursuant Letter of Credit or security to Section 4.3 a new landlord. If thirty (30) days prior to the date of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodsuch sale, Landlord shall be entitled to draw upon said letter holding a Letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, Credit as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant's security, Tenant shall within will upon five (5) days after prior written demand by notice, deliver a substitute Letter of Credit naming the new landlord as the new beneficiary thereof and Landlord restore shall return to Tenant the letter existing Letter of credit. Failure Credit. (h) Tenant shall not assign or encumber or attempt to so restore said letter of credit within said five (5) days assign or encumber the monies deposited herein as security and neither Landlord nor its successors or assigns shall be a default bound by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereofsuch assignment, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Leaseencumbrance, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termor attempted assignment or encumbrance.

Letter of Credit. In addition to At any time during the Security Deposit and as security hereunderTerm, Tenant shall have the right to deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by Landlord a letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars the Security Deposit, to be held by Landlord as security for the performance by Tenant of all of the obligations to be performed by it under this Lease. In such event, Landlord shall refund the cash Security Deposit and all accrued interest thereon to Tenant within fifteen ($166,229.00). Said 15) days after receipt of such letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlordcredit. The letter of credit (and each replacement or renewal thereof) shall either: (i) be issued with a fixed expiration date of December 31irrevocable, 2005, or (ii) shall provide be issued by NationsBank, N.A. or another national bank having an office in Washington, D.C. or Fairfax County, Virginia, which has net assets of $50,000,000 or more, (iii) be for automatic annual renewals through that date which is sixty (60) days a term of not less than 12 months after the Expiration Date date of issuance, and (iv) authorize Landlord to draw thereon by a sight draft delivered to the Term issuing bank accompanied by an affidavit of this Lease. In the event the a general partner, or executive officer, of Landlord that an Event of Default has occurred and is continuing or that Tenant has failed to deliver a replacement letter of credit is issued with an annual renewal obligation and within the letter of credit is not renewed time required by the issuing financial institution this subsection. Tenant shall, on or before twenty (20) days prior to the then-scheduled 30th day before the expiration date of the letter of credit, credit then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined being held by Landlord in its sole and absolute discretionunder this subsection, and if such amount cannot be readily determined by Landlord, then the full amount deliver to Landlord an extension or renewal of the letter of credit can be drawn for a period of not less than 12 months. Tenant shall extend or renew the letter of credit, or any extension or renewal thereof, for successive periods of at least 12 months each throughout the Term. Upon the occurrence of an Event of Default or the Tenant’s failure to deliver a replacement letter of credit within the time required by this subsection, Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant authorized to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of on the letter of credit is drawn after a default then being held by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of creditit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to receive, hold and apply the principal amount proceeds of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon same manner and on the expiration same terms as the Security Deposit. All references in this Lease to the “Security Deposit” shall be deemed to include the proceeds of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months letter of the Termcredit.

Letter of Credit. In addition Tenant agrees to provide, at Tenant's sole cost and expense, a Letter of Credit (as defined below) in the Security Deposit Letter of Credit Required Amount (as defined below) as additional security for the faithful performance and as security hereunder, observance by Tenant shall deliver to Landlord, concurrently with Tenant’s execution of all of the provisions of this Lease, an irrevocable stand-on the terms and conditions set forth below. The use, application or retention of the Letter of Credit, or any portion thereof, by letter Landlord shall not prevent Landlord from exercising any other right or remedy provided by this Lease or by law, it being intended that Landlord shall not first be required to proceed against the Letter of credit in Credit and the amount Letter of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars (Credit shall not operate as a limitation on any recovery to which Landlord may otherwise be entitled. As used herein the term "Letter of Credit Required Amount" initially means $166,229.00)338,981.00. Said letter Subject to the remaining terms of credit shall be in form and with the substance of Exhibit F attached heretothis Article 37, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: provided the Reduction Condition (ias defined below) be issued with a fixed expiration date of December 31has been satisfied at the particular reduction effective date, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord Tenant shall have the right to draw reduce the full amount Required Amount so that the new Required Amount shall be $314,981.00 effective as of such letter January 1, 2011; $280,981.00 effective as of credit January 1, 2012; $223,981.00 effective as of January 1, 2013; $150,981.00 effective as of January 1, 2014; and $54,981.00 effective as of January 1, 2015. If Tenant is not entitled to hold such amount reduce the Required Amount as part of a particular reduction effective date due to the failure of the Security Deposit pursuant Reduction Condition, then any subsequent reduction(s) Tenant is entitled to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord hereunder shall be entitled to draw upon said letter of credit reduced by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amountreduction Tenant would have been entitled to had the Reduction Condition been satisfied. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided If Tenant is entitled to a reduction in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by TenantRequired Amount, Tenant shall within five provide Landlord with written notice requesting that the Required Amount be reduced as provided above (5) days after written demand the “Reduction Notice”). If Tenant provides Landlord with a Reduction Notice, and Tenant is entitled to reduce the Required Amount as provided herein, the reduction shall be effectuated by Tenant replacing the Letter of Credit then being held by Landlord restore with a new Letter of Credit in the letter new Required Amount or amending the then-existing Letter of creditCredit to that new Required Amount. Failure to so restore said letter The term "Reduction Condition" means no Event of credit within said five (5) days Default shall have occurred and be a default by Tenant continuing under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Term.

Letter of Credit. In addition to the Security Deposit Concurrently with Tenant’s execution and as security hereunderdelivery of this Lease, Tenant shall deliver to LandlordLandlord a clean, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in the amount set forth in Article 1, which shall comply with, and may be drawn by Landlord in accordance with, the provisions of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars this Section 6.01 ($166,229.00). Said such letter of credit credit, together with any renewal or replacement thereof in accordance herewith, being referred to herein as the “Letter of Credit”). 6.01.1 The Letter of Credit shall be for the amount set forth in form and with Article 1 of this Lease, subject to the substance terms of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to LandlordArticle 6 of this Lease. The letter Letter of credit shall either: Credit (i) shall be irrevocable and shall be issued with by a fixed expiration date commercial bank that has a financial condition reasonably acceptable to Landlord and has an office in San Francisco, California; Boston, Massachusetts; or New York City that accepts requests for draws on the Letter of December 31Credit, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after require only the Expiration Date presentation to the issuer of a certificate of the Term holder of the Letter of Credit stating that Landlord is entitled to draw on the Letter of Credit pursuant to the terms of this Lease. In , (iii) shall be payable to Landlord or its successors in interest as the event Landlord and shall be freely transferable without cost to any such successor or any lender holding a collateral assignment of Landlord’s interest in this Lease, (iv) shall be for an initial term of not less than one year and contain a provision that such term shall be automatically renewed for successive one‑year periods unless the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty issuer shall, at least forty five (2045) days prior to the then-scheduled expiration date date, give Landlord notice of such nonrenewal, (v) shall permit drawings to be made via facsimile transmission and (vi) shall otherwise be in form and substance reasonably acceptable to Landlord. Notwithstanding the foregoing, the term of the letter Letter of creditCredit for the final period shall be for a term ending not earlier than the date forty five (45) days after the last day of the Term. In the event that the issuer ceases to be reasonably acceptable to Landlord, due to a deterioration in its financial condition or change in status that threatens to compromise Landlord’s ability to draw on the Letter of Credit as determined in good faith by Landlord, then Landlord Tenant shall have provide a replacement Letter of Credit from an issuer satisfying the right to draw the full amount terms of this Section within thirty (30) days after Landlord’s notice of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, event. 6.01.2 Landlord shall be entitled to draw upon said letter the Letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord Credit for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount or any portion thereof if (a) Tenant shall fail to perform any of its obligations under this Lease after the expiration of any applicable notice and cure period, or fail to perform any of its obligations under this Lease and transmittal of a default notice or the running of any cure period is barred or tolled by applicable law, or fail to perform any of its obligations under this Lease and any applicable notice and cure period would expire after the expiration of the letter Letter of credit can be drawn by Credit, or (b) not less than thirty (30) days before the scheduled expiration of the Letter of Credit, Tenant has not delivered to Landlord pending determination a new Letter of said amountCredit in accordance with this Section. Notwithstanding Without limiting the generality of the foregoing, while Landlord may, but shall not be obligated to, draw on the amount Letter of Credit from time to time in the event of a bankruptcy filing by or against Tenant and/or to compensate Landlord, in such order as Landlord may determine, for all or any part of any such draw shall be determined unpaid rent, any damages arising from any termination of this Lease in Landlord’s sole and absolute discretion as provided in accordance with the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV terms of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or damages arising from any rights Landlord may have under rejection of this Lease in a bankruptcy proceeding -11- |US-DOCS\129492181.2|| commenced by or at law or in equity against Tenant and/or any damages that Landlord reasonably estimates it will suffer as a result of the default, as a setoff for full any breach or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings Landlord may, but shall not be obligated to, apply the amount so drawn to the extent necessary to cure Tenant’s failure. 6.01.3 After any application by Landlord of the Letter of Credit, Tenant shall reinstate the Letter of Credit to the amount originally required to be maintained under this Lease, upon said letter of credit shall be permitteddemand. In the event Provided that Tenant has is not been then in default under the Lease (beyond this Lease, and no condition exists or event has occurred which after the expiration of any applicable notice or cure periodperiod would constitute such a default, within forty five (45) at any time during days after the later to occur of (i) the payment of the final Rent due from Tenant or (ii) the later to occur of the Term hereofExpiration Date or the date on which Tenant surrenders the Premises to Landlord in compliance with Article 20 of this Lease, the Letter of Credit shall be returned to the Tenant. Tenant acknowledges that the Letter of Credit is not a security deposit; instead, it is a credit enhancement in order to induce Landlord to lease the Premises to Tenant. Tenant hereby waives any and provided further all provisions of law, now or hereafter in effect, which (i) establish the time frame by which a landlord must refund a security deposit under a lease, and/or (ii) provide that Tenant has not at a landlord may claim from a security deposit only those sums reasonably necessary to remedy defaults in the payment of rent, to repair damage caused by a tenant or to clean the premises, it being agreed that Landlord may, in addition, claim those sums specified in this Section above and/or those sums reasonably necessary to compensate Landlord for any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments loss or damage caused by Tenant’s default of rent due under the Lease. Tenant agrees not to interfere in any way with any payment to Landlord of the proceeds of the Letter of Credit, then either prior to or following a “draw” by Landlord of all or any portion of the Letter of Credit, regardless of whether any dispute exists between Tenant and Landlord as to Landlord’s right to draw down all or any portion of the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional and thereby afford the Letter of Credit bank a justification for failing to honor a drawing upon such Letter of Credit in a timely manner. Tenant shall not request or instruct the written request Bank of Tenantany Letter of Credit to refrain from paying sight draft(s) drawn under such Letter of Credit. 6.01.4 In the event of a sale of the Building or lease, conveyance or transfer of the Building, Landlord shall authorize in writing consecutive reductions transfer the Letter of Credit to the principal amount transferee. Upon such transfer, Landlord shall be released by Tenant from all liability for the return of such Letter of Credit, and Tenant agrees to look to the transferee solely for the return of said Letter of Credit. The provisions hereof shall apply to every transfer or assignment made of the letter Letter of credit Credit to such a transferee. Tenant further covenants that it will not assign or encumber or attempt to assign or encumber the Letter of Credit and that neither Landlord nor its successors or assigns shall be bound by any assignment, encumbrance, attempted assignment or attempted encumbrance. 6.01.5 Notwithstanding anything to the contrary contained herein and provided Tenant is not in Default of the terms of this Lease, after expiration of any applicable notice and cure period, the Letter of Credit amount shall be automatically reduced as follows: (i) on the first annual anniversary of Thirty Three the Rent Commencement Date, the Letter of Credit amount shall be reduced to Eight Hundred Eighty‑Three Thousand Two Eight Hundred Forty-Six Fifty‑Five Dollars ($33,246.00883,855.00); and (ii) each upon on the expiration of the twelfth second (12th2nd) Lease Year, the Letter of Credit amount shall be reduced to Seven Hundred Seven Thousand Eighty‑Four Dollars ($707,084.00), twenty. |US-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Term.DOCS\129492181.2||

Letter of Credit. In addition to the Security Deposit and as security hereunder(a) By no later than October 12, Tenant 1999, Sublessee shall deliver to LandlordSublessor an unconditional, concurrently with Tenant’s execution of this Leaseirrevocable, an irrevocable stand-by transferable and negotiable standby letter of credit (the "L/C") in the an amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars equal to $110,000.00 ($166,229.00"Face Amount"). Said letter of credit shall be , issued by a bank or trust company ("Issuer") and in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is content acceptable to LandlordSublessor, in its sole and absolute discretion, as additional security for the performance of Sublessee's obligations under the Sublease. The letter of credit L/C shall either: be maintained throughout the period from the date it is required to be delivered to Sublessor through thirty (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (6030) days after the Expiration Date end of the Term or earlier termination of this Leasethe Sublease. In An L/C in the event form attached hereto as Schedule I is ---------- hereby approved by Sublessor. The L/C shall name Sublessor as beneficiary thereunder and provide that draws, including partial draws, at Sublessor's election, will be honored upon the letter delivery to the Issuer of credit is issued with a certificate signed by Sublessor, or its authorized agent, that Sublessee has committed an annual Event of Default under the Sublease. The L/C shall also provide that it will be automatically extended upon each renewal obligation and date unless the letter of credit is not renewed by the issuing financial institution on or before twenty Issuer thereof delivers to Sublessor, no later than thirty (2030) days prior to the then-scheduled stated expiration date of the letter L/C, written notice of credit, then Landlord shall have Issuer's intent not to extent or renew the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. L/C. Upon any default Event of Default by TenantSublessee under the Sublease, including specifically Tenant’s Sublessee's failure to pay rent or to abide by its obligations under Sections 7.1 Paragraphs 8 and 15.3 below and Tenant’s failure to cure 10 of the same within any applicable cure periodMaster Lease, Landlord Sublessor shall be entitled to draw upon said letter of credit L/C by the issuance of Landlord’s Sublessee's sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to TenantIssuer. Any such draw shall be without waiver or of any rights Landlord Sublessor may have under this Lease the Sublease or at law or in equity as a result of the default. During any period that Sublessee is required to maintain the L/C, as Sublessee shall, at lease thirty (30) days prior to any expiration or termination of the L/C, provide Sublessor either with written confirmation that the existing L/C will be automatically extended and renewed or with a setoff for full or partial compensation new L/C that satisfies all of the requirements for the defaultL/C in this Paragraph 1. If any portion of the letter of credit L/C is drawn by Sublessor after a default an Event of Default by TenantSublessee, Tenant Sublessee shall within five (5) business days after written demand by Landlord Sublessor restore the letter L/C to the amount of creditthe L/C then-required under this Paragraph 1. Failure In addition, upon an assignment of the Sublease by Sublessor (including consolidations, mergers, or other entity changes), Sublessee, at its sole cost and expense and upon ten (10) business days' notice, shall, concurrent with Sublessor's delivery to so restore said letter Sublessee of credit within said five the then outstanding L/C, deliver to any such transferees, successor, or assigns a replacement L/C on identical terms (5except for the stated beneficiary) days from the same Issuer or another bank or trust company acceptable to Sublessor, in Sublessor's sole discretion, naming the new Sublessor as the beneficiary thereof. Sublessee's failure to perform or observe any of the covenants set forth in this Paragraph 1 for any reason shall entitle Sublessor to draw on the full amount of the L/C and shall constitute an Event of Default (defined below) under the Sublease without the requirement of any notice from Sublessor. Any amount(s) drawn under the L/C shall be a default held or used by Tenant under this Lease. Partial drawings upon said letter Sublessor as an additional Security Deposit in accordance with the terms of credit shall be permitted. In Paragraph 5 of the event that Tenant Sublease. (b) If as of the first (1st) and second (2nd) anniversary dates following the Commencement Date, no prior or current Event of Default has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereofoccurred, and provided further that Tenant no event or condition exists or has not at any occurred which the passage of time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments or delivery of rent due under the Leasenotice by Sublessor, then or both, would constitute a default, upon the written request of TenantSublessee, Landlord Sublessor shall promptly authorize in writing consecutive reductions to the principal amount of the letter of credit L/C in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars $36,666.66 so that the Face Amount is reduced to $73,333.33 on the first anniversary date and to $36,666.66 on the second anniversary date. ($33,246.00c) each upon For all purposes under the expiration Sublease, an "Event of Default" shall be deemed to have occurred if any of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months events of default specified in Paragraph 22 of the TermMaster Lease occurs and such default continues beyond any applicable notice and grace period provided for therein.

Letter of Credit. In addition (a) Simultaneously with its execution and delivery of this Lease to the Security Deposit and as security hereunderLandlord, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, Landlord an irrevocable stand-by and unconditional letter of credit in (the amount "Letter of One Hundred Sixty Six Thousand Two Hundred TwentyCredit"), which is transferable to Landlord's successor(s)-in-Nine Dollars ($166,229.00). Said letter interest as owner(s) of credit shall be the Building, issued by an institutional lender acceptable to Landlord and otherwise in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable content satisfactory to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 for the faithful performance and observance by Tenant of all of the terms, provisions and conditions of this Lease. (b) The Letter of Credit shall remain in effect until May 31, 1995. Upon any default by TenantIf the expiry date of the Letter of Credit is sooner than May 31, including specifically Tenant’s failure 1995, Tenant shall renew or replace the Letter of Credit at least thirty (30) days prior to pay rent its expiry date. If Tenant fails to so renew or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure replace the same Letter of Credit within any applicable cure such time period, Landlord Tenant shall be entitled deemed to be in default under this Lease, without any notice or opportunity to cure. (c) The Letter of Credit shall be in the face amount of Sixty-Five Thousand Dollars ($65,000.00). So long as the Letter of Credit has not been drawn upon, the face amount of the Letter of Credit shall reduce to Thirty-Five Thousand Dollars ($35,000.00) on June 1, 1994. (d) Although Landlord hereby agrees that it may only draw upon said letter the Letter of credit Credit if Tenant is in default under this Lease, the Letter of Credit shall, on its face, provide that Landlord may draw upon the Letter of Credit by the issuance of Landlord’s sole written demand presenting appropriate identification to the issuing financial institutionbank and requesting a draw. Such draw In the event Landlord draws upon the Letter of Credit, Tenant shall reinstate the Letter of Credit to its full face amount within fifteen (15) days of such draw. If Tenant fails to so reinstate the Letter of Credit within such 15-day period, Tenant shall be deemed to be in an amount necessary default under this Lease, without any notice or opportunity to cure the default cure. (e) Tenant may at any time deliver to Landlord cash in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter Letter of credit can be drawn by Landlord pending determination of said amountCredit. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any deposit such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or cash in equity as a result of the defaultan interest- bearing account, as a setoff for full or partial compensation with interest accruing for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request benefit of Tenant, Landlord shall authorize in writing consecutive reductions and return to Tenant the principal amount Letter of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermCredit.

Letter of Credit. In Landlord is currently holding the sum of $150,000.00 (the “Existing Security Deposit”) as a security deposit pursuant to the terms of the Lease. Concurrent with Tenant's execution and delivery of this Amendment to Landlord, and in addition to the Existing Security Deposit and as security hereunderDeposit, Tenant shall deliver to Landlord, concurrently with Tenant’s execution as collateral for the full performance by Tenant of this all of its obligations under the Lease, as amended hereby, and for all losses and damages Landlord may suffer as a result of Tenant's failure to comply with one or more provisions of the Lease, as amended hereby, including, but not limited to, any post lease termination damages under Section 1951.2 of the California Civil Code, an irrevocable stand-by letter Irrevocable Standby Letter of credit Credit (the “Letter of Credit”) in the amount of One Million Four Hundred Sixty Six Forty-One Thousand Two Three Hundred Twenty-Nine Eighty and No/Dollars ($166,229.001,441,380.00). Said The following terms and conditions shall apply to the Letter of Credit: 5.1 The Letter of Credit shall be in favor of Landlord, shall be issued by a bank acceptable to Landlord with a Standard & Poors rating of “A” or better, shall comply with all of the terms and conditions of this Section 5 and shall otherwise be in the form acceptable to Landlord. 5.2 The Letter of Credit or any replacement Letter of Credit shall be irrevocable for the term thereof and shall automatically renew on a year to year basis until a period ending not earlier than two (2) months subsequent to the termination date of the Lease (the “LOC Expiration Date”) without any action whatsoever on the part of Landlord; provided that the issuing bank shall have the right not to renew the Letter of Credit by giving written notice to Landlord not less than sixty (60) days prior to the expiration of the then current term of the Letter of Credit that it does not intend to renew the Letter of Credit. Tenant understands that the election by the issuing bank not to renew the Letter of Credit shall not, in any event, diminish the obligation of Tenant to deposit the Security Deposit, if any, or maintain such an irrevocable Letter of Credit in favor of Landlord through the LOC Expiration Date. 5.3 Landlord, or its then authorized representative, upon Tenant's failure to comply with one or more provisions of the Lease, as amended hereby, or as otherwise specifically agreed by Landlord and Tenant pursuant to the Lease or any amendment hereof, without prejudice to any other remedy provided in the Lease or by applicable laws, shall have the right from time to time to make one or more draws on the Letter of Credit and use all or part of the proceeds in accordance with Section 5.4 below. In addition, if Tenant fails to furnish a renewal or replacement letter of credit shall complying with all of the provisions of this Section 5 at least sixty (60) days prior to the stated expiration date of the Letter of Credit then held by Landlord, Landlord may draw upon such Letter of Credit and hold the proceeds thereof (and such proceeds need not be segregated) in form and accordance with the substance terms of Exhibit F attached heretothis Section 5. Funds may be drawn down on the Letter of Credit upon presentation to the issuing bank of Landlord's (or Landlord's then authorized representative's) certification that Landlord is entitled to such funds pursuant to the Lease and/or any amendment to the Lease or any other agreement between the parties pertaining the Lease, and issued otherwise in a form set forth in the Letter of Credit approved by Silicon Valley Bank or by another financial institution located Landlord. 5.4 Tenant shall have the right to reduce the amount of the Letter of Credit in Orange County accordance with this Section 5.4 if (a) Tenant has timely paid all Rent due under the Lease, as amended hereby, during the twelve (12) month period immediately preceding the effective date of any reduction of the Letter of Credit, and which is acceptable to Landlord. The letter of credit shall either: (b) Tenant either (i) be issued with a fixed expiration date of December 31, 2005, delivers to Landlord written documentation reasonably satisfactory evidencing that Tenant has received formal written approval from the U.S. Food and Drug Administration to market its lead drug candidate Neratinib to the public (the “FDA Reduction Condition”); or (ii) provides to Landlord Tenant's Financial Information (defined below) reflecting four (4) consecutive quarters of positive Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) equal to or greater than $200,000,000.00 (the “EBITDA Reduction Condition”). In the event that Tenant fully satisfies the condition set forth in clause (a) above (the “General Reduction Condition”) and the FDA Reduction Condition, then Tenant shall have the right to reduce the amount of the Letter of Credit by $500,000.00 effective as of the third (3rd) anniversary of the Substitution Effective Date (“Reduction Effective Date”). In addition, in the event that Tenant fully satisfies the General Reduction Condition and the EBITDA Reduction Condition, Tenant shall have the right to reduce the amount of the Letter of Credit by $500,000.00 effective as the Reduction Effective Date. By way of example, if Tenant meets the General Reduction Condition and the FDA Reduction Condition, but does not meet the EBITDA Reduction Condition, Tenant shall have the right to reduce the Letter of Credit by $500,000.00 effective as the Reduction Effective Date. However, if Tenant meets the General Reduction Condition, the FDA Reduction Condition and the EBITDA Reduction Condition, Tenant shall have the right to reduce the Letter of Credit by $1,000,000.00 effective as of the Reduction Effective Date. If Tenant does not have the right to reduce the Letter of Credit effective as of the Reduction Effective Date due to Tenant's failure to meet the General Reduction Condition, the FDA Reduction Condition and/or the EBITDA Reduction Condition, the Reduction Effective Date shall be tolled for a period of twelve (12) months and Tenant shall once again have the right to satisfy the FDA Reduction Condition and/or the EBITDA Reduction Condition and reduce the Letter of Credit as of the next succeeding anniversary of the Substitution Effective Date; provided, however, in no event shall Tenant have the right to reduce the Letter of Credit by more than $1,000,000.00. If Tenant is entitled to a reduction in the Letter of Credit, Tenant shall provide for automatic annual renewals through Landlord with written notice requesting that date the Letter of Credit be reduced as provided above (the “Reduction Notice”). If Tenant is requesting a reduction of the Letter of Credit based on satisfaction of the EBITDA Reduction Condition, concurrent with Tenant's delivery of the Reduction Notice, Tenant shall deliver to Landlord Tenant's financial statements prepared in accordance with generally accepted accounting principles and certified by an officer of Tenant as being a true and correct copy of Tenant's most recent audited financial statements (as audited by a nationally recognized public accounting firm reasonably acceptable to Landlord), and any other financial information requested by Landlord, evidencing Tenant's full satisfaction of the EBITDA Reduction Condition (“Tenant's Financial Information”). If Tenant provides Landlord with a Reduction Notice, and Tenant is entitled to reduce the Letter of Credit as provided herein, any reduction in the Letter of Credit amount shall be accomplished by Tenant providing Landlord with an amendment to the Letter of Credit or a substitute Letter of Credit in the reduced amount, which substitute Letter of Credit shall comply with the requirements of this Section 5. 5.5 Tenant acknowledges and agrees (and the Letter of Credit shall so state) that the Letter of Credit shall be honored by the issuing bank without inquiry as to the truth of the statements set forth in such draw request and regardless of whether the Tenant disputes the content of such statement. The proceeds of the Letter of Credit shall constitute Landlord's sole and separate property (and not Tenant's property or the property of Tenant's bankruptcy estate) and Landlord may immediately upon any draw (and without notice to Tenant) apply or offset the proceeds of the Letter of Credit: (a) against any rent or other amounts payable by Tenant under the Lease, as amended hereby, that is not paid when due; (b) against all losses and damages that Landlord has suffered or that Landlord reasonably estimates that it may suffer as a result of Tenant's failure to comply with one or more provisions of the Lease, as amended hereby, including any damages arising under Section 1951.2 of the California Civil Code following termination of the Lease; (c) against any costs incurred by Landlord in connection with the Lease (including attorneys' fees); and (d) against any other amount that Landlord may spend or become obligated to spend by reason of Tenant's default. Provided Tenant has performed all of its obligations under the Lease, as amended hereby, Landlord agrees to pay to Tenant within sixty (60) days after the LOC Expiration Date the amount of any proceeds of the Term Letter of Credit received by Landlord and not applied as allowed above; provided, that if prior to the LOC Expiration Date a voluntary petition is filed by Tenant or any guarantor, or an involuntary petition is filed against Tenant or any guarantor by any of Tenant's or guarantor's creditors, under the Federal Bankruptcy Code, then Landlord shall not be obligated to make such payment in the amount of the unused Letter of Credit proceeds until either all preference issues relating to payments under the Lease have been resolved in such bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed, in each case pursuant to a final court order not subject to appeal or any stay pending appeal. 5.6 If, as result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the amount set forth in this Lease. In Section 5, Tenant shall, within five (5) days thereafter, provide Landlord with additional letter(s) of credit in an amount equal to the event the deficiency (or a replacement letter of credit is issued with an annual renewal obligation in the total amount required pursuant to this Section 5), and the any such additional (or replacement) letter of credit is not renewed shall comply with all of the provisions of this Section 5, and if Tenant fails to comply with the foregoing, notwithstanding anything to the contrary contained in the Lease, as amended hereby, the same shall constitute an incurable Event of Default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. 5.7 Landlord may, at any time and without notice to Tenant and without first obtaining Tenant's consent thereto, transfer all or any portion of its interest in and to the Letter of Credit to another party, person or entity, including Landlord's mortgagee and/or to have the Letter of Credit reissued in the name of Landlord's mortgagee. If Landlord transfers its interest in the Building and transfers the Letter of Credit (or any proceeds thereof then held by Landlord) in whole or in part to the transferee, Landlord shall, without any further agreement between the parties hereto, thereupon be released by Tenant from all liability therefor. The provisions hereof shall apply to every transfer or assignment of all or any part of the Letter of Credit to a new landlord. In connection with any such transfer of the Letter of Credit by Landlord, Tenant shall, at Tenant's sole cost and expense, execute and submit to the issuer of the Letter of Credit such applications, documents and instruments as may be necessary to effectuate such transfer. Tenant shall be responsible for paying the issuer's transfer and processing fees in connection with any transfer of the Letter of Credit and, if Landlord advances any such fees (without having any obligation to do so), Tenant shall reimburse Landlord for any such transfer or processing fees within ten (10) days after Landlord's written request therefor. 5.8 If the Letter of Credit expires earlier than the LOC Expiration Date, or the issuing financial institution on bank notifies Landlord that it shall not renew the Letter of Credit, Landlord shall accept a renewal thereof or before twenty substitute letter of credit (20such renewal or substitute Letter of Credit to be in effect not later than sixty (60) days prior to the then-scheduled expiration date thereof), irrevocable and automatically renewable through the LOC Expiration Date upon the same terms as the expiring Letter of Credit or upon such other terms as may be acceptable to Landlord. However, if (a) the Letter of Credit is not timely renewed, or (b) a substitute Letter of Credit, complying with all of the letter terms and conditions of creditthis Section 5 is not timely received, then Landlord may present such Letter of Credit to the issuing bank, and the entire sum so obtained shall have the right be paid to draw the full amount of such letter of credit and Landlord, to hold such amount as part be held by Landlord in accordance with Article 8 of the Security Deposit pursuant to Section 4.3 of this Original Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure Notwithstanding the same within any applicable cure periodforegoing, Landlord shall be entitled to draw upon said letter receive from Tenant all attorneys' fees and costs incurred in connection with the review of credit any proposed substitute Letter of Credit pursuant to this Section. 5.9 Landlord and Tenant (a) acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or any proceeds thereof be deemed to be or treated as a “security deposit” under any law applicable to security deposits in the commercial context including Section 1950.7 of the California Civil Code, as such section now exist or as may be hereafter amended or succeeded (“Security Deposit Laws”), (b) acknowledge and agree that the Letter of Credit (including any renewal thereof or substitute therefor or any proceeds thereof) is not intended to serve as a security deposit, and the Security Deposit Laws shall have no applicability or relevancy thereto, and (c) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws. Tenant hereby waives the provisions of Section 1950.7 of the California Civil Code and all other provisions of applicable laws, now or hereafter in effect, which (i) establish the time frame by which Landlord must refund a security deposit under a lease, and/or (ii) provide that Landlord may claim from the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount security deposit only those sums reasonably necessary to cure remedy defaults in the default payment of rent, to repair damage caused by Tenant or to clean the Premises, it being agreed that Landlord may, in question and addition, claim those sums specified above in this Section 5 and/or those sums reasonably necessary to compensate Landlord for all damages incurred therebyany loss or damage caused by Tenant's breach of the Lease, as determined by amended hereby, or the acts or omission of Tenant or any of Tenant's Parties, including my damages Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount suffers following termination of the Lease. 5.10 Notwithstanding anything to the contrary contained in the Lease, as amended hereby, in the event that at any time the financial institution which issues said Letter of Credit is declared insolvent by the FDIC or is closed for any reason, Tenant must immediately provide a substitute letter of credit can be drawn by Landlord pending determination that satisfies the requirements of said amount. Notwithstanding the foregoingLease hereby from a financial institution acceptable to Landlord, while the amount of any such draw shall be determined in Landlord’s 's sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termdiscretion.

Letter of Credit. In addition to Tenant, at any time during the Term, may deposit with Landlord in lieu of the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit issued by a commercial bank reasonably acceptable to Landlord (referred to as the “Bank”) in favor of Landlord, in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00)the Security Deposit. Said letter of credit Landlord shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date have all of the Term same rights with respect to the Letter of Credit as Landlord has hereunder with respect to the Security Deposit. Upon Landlord’s receipt of the Letter of Credit, Landlord shall return the cash Security Deposit to Tenant, together with interest thereon, less any deductions authorized under this Lease. In Tenant agrees to cause the event Bank to renew the letter Letter of credit is issued with an annual renewal obligation and Credit, in the letter of credit is not renewed by same form from time to time during the issuing financial institution on or before twenty Term, at least thirty (2030) days prior to the then-scheduled expiration date of such Letter of Credit or any renewal thereof, so that a Letter of Credit issued by the Bank to Landlord shall be in full force and effect throughout the Term. If Tenant defaults in respect to any of the letter terms, conditions or provisions of creditthis Lease (beyond applicable notice and cure periods), then Landlord shall have the right to require the Bank to make payment to Landlord from the Letter of Credit of the sum necessary to cure Tenant’s default, provided that Landlord shall have given Tenant ten (10) days’ notice of Landlord’s intent to draw on the full Letter of Credit, and Tenant has not, within such ten (10) day period, deposited in cash with Landlord the amount of such letter of credit the alleged default. If Tenant shall fully and to hold such amount as part faithfully comply with all of the Security Deposit pursuant to Section 4.3 terms, provisions, covenants, and conditions of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord Letter of Credit shall be entitled returned to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default Tenant within thirty (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (530) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Term.

Letter of Credit. In addition to the Security Deposit and as security hereunderConcurrently with Tenant's execution of this Lease, Tenant shall deliver to LandlordLandlord an unconditional, concurrently with Tenant’s execution of this Leaseirrevocable, an irrevocable stand-by transferable letter of credit credit, in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Million Dollars ($166,229.001,000,000). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another a financial institution located in Orange County and which is acceptable to Landlord. The letter Landlord in the form attached hereto as Exhibit "F", with an original term of credit shall either: (i) be issued with a fixed expiration date no less than one year and automatic extensions through the end of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is the Term of this Lease and sixty (60) days thereafter (the "Letter of Credit"). Tenant shall keep the Letter of Credit, at its expense, in full force and effect until the sixtieth (60th) day after the Expiration Date of the Term or other termination of this Lease, to insure the faithful performance by Tenant of all of the covenants, terms and conditions of this Lease, including, without limitation, Tenant's obligations to repair, replace or maintain the Premises. In The Letter of Credit shall provide thirty (30) days' prior written notice to Landlord of cancellation or material change thereof, and shall further provide that, in the event of any nonextension of the letter Letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty Credit at least thirty (2030) days prior to its expiration, the then-scheduled expiration date of the letter of creditentire face amount shall automatically be paid to Landlord, then and Landlord shall have hold the right to draw funds so obtained as the full amount of such letter of credit and to hold such amount as part of the Security Deposit pursuant to Section 4.3 of security deposit required under this Lease. Upon If for any default by Tenant, including specifically Tenant’s failure reason such automatic payment does not occur in the event of a nonextension at least thirty (30) days prior to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodexpiration, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole present its written demand for payment of the entire face amount of the Letter of Credit, and the funds so obtained shall be held as provided above. Any unused portion of the funds so obtained by Landlord shall be returned to Tenant upon replacement of the Letter of Credit or deposit of cash security in the full amount required hereunder. If Landlord uses any portion of the cash security deposit to cure any default by Tenant hereunder, Tenant shall replenish the security deposit to the issuing financial institutionoriginal amount within ten (10) days of notice from Landlord. Such draw Tenant's failure to do so shall be in a material breach of this Lease. Landlord shall keep any cash security funds separate from its general funds, and shall invest such cash security at Tenant's reasonable direction, and any interest actually earned by Landlord on such cash security shall be paid to Tenant quarterly. If an event of default occurs under this Lease, or if Tenant is the subject of an Insolvency Proceeding, Landlord may present its written demand for payment of the entire face amount necessary of the Letter of Credit and the funds so obtained shall become due and payable to cure Landlord. Landlord may retain such funds to the default in question and extent required to compensate Landlord for all damages incurred therebyincurred, or to reimburse Landlord as determined by Landlord provided herein, in its sole and absolute discretionconnection with any such event of default, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw remaining funds shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity held as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termcash security deposit.

Letter of Credit. In addition Prior to the Security Deposit execution of the Lease, Tenant shall provide to Landlord a letter of credit ("Letter of Credit") in the form attached to the Lease as Exhibit E to secure payment of the Xxxxxxx Restoration Cost. The amount of the letter of credit shall initially be One Million Five Hundred Thousand Dollars and as security hereunderno cents ($1,500,000.00). Such amount shall be changed to be equal to the actual Xxxxxxx Restoration Cost, and shall be increased from time to time to equal the then actual Xxxxxxx Restoration Cost ("LC Amount"). An amended or new Letter of Credit shall be issued and delivered to Landlord within twenty days of any change in the actual Xxxxxxx Restoration Cost and conditioned on Landlord returning to Tenant the prior Letter of Credit in exchange for the amended or new Letter of Credit. The Letter of Credit shall be (i) at sight and irrevocable and unconditional, (ii) subject to the terms of this Addendum, maintained in effect, whether through replacement, renewal or extension, for the period from the Commencement Date of the Lease and continuing until the Xxxxxxx Restoration Cost is paid to Landlord (the "Letter of Credit Expiration Date"). If the Letter of Credit is to expire and not be automatically renewed, Tenant shall deliver a new Letter of Credit or certificate of renewal or extension to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars Landlord at least thirty ($166,229.00). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (2030) days prior to the then-scheduled expiration date of the letter Letter of creditCredit, then without any action whatsoever on the part of Landlord until the Letter of Credit Expiration Date. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. If Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Addendum or fails to comply with the Xxxxxxx Restoration Obligation, as set forth above, Landlord shall have the right to draw present such Letter of Credit to the full amount bank in accordance with the terms of this Addendum, and the entire sum evidenced thereby shall be paid to and held by Landlord as collateral for performance of Tenant's obligations to pay to Landlord the Xxxxxxx Restoration Cost upon Lease termination. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor be (a) deemed to be or treated as a "security deposit" within the meaning of California Civil Code Section 1950.7 (as supplemented, amended, replaced and substituted from time to time), (b) subject to the terms of such letter Section 1950.7 (as supplemented, amended, replaced and substituted from time to time), or (c) intended to serve as a "security deposit" within the meaning of credit such Section 1950.7 (as supplemented, amended, replaced and substituted from time to hold time). The parties hereto (x) recite that the Letter of Credit is not intended to serve as a security deposit and such amount Section 1950.7 (as part of supplemented, amended, replaced and substituted from time to time), and any and all other laws, rules and regulations applicable to security deposits in the commercial context ("Security Deposit Laws") shall have no applicability or relevancy thereto and (y) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermLaws.

Letter of Credit. In addition Simultaneously with Tenant’s delivery to Landlord of this Lease, the Base Rent and Tenant’s Share of Direct Expenses first coming due hereunder and the Security Deposit in accordance with the provisions of Article 3 and as security hereunderArticle 20 above, Tenant shall deliver to Landlord, concurrently with Tenant’s execution as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease, an irrevocable stand-by and unconditional negotiable letter of credit (the “Letter of Credit”), in the form and containing the terms required herein, payable in the City of Foster City, California running in favor of Landlord issued by a solvent nationally recognized bank with a long term rating of BBB or higher, under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association (the “Issuer”), in the amount of One Eighty-five Thousand Seven Hundred Sixty Six Thousand Two Hundred Twenty-Nine Twelve Dollars ($166,229.0085,712) (the “LC Amount”). Said letter Notwithstanding the foregoing and provided there shall not have occurred a default under Article 19 of credit the Lease at any time during the Term, the LC Amount shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall eitherreduced as follows: (i) if on the eighteen month anniversary of the Lease Commencement Date Tenant has working capital of at least $20,000,000, the LC Amount shall be issued with a fixed expiration date of December 31reduced to $56,808, 2005, or and (ii) if on the third annual anniversary of the Lease Commencement Date Tenant (a) is profitable (according to generally accepted accounting principles) and (b) has at least $5,000,000 in cash reserves, the LC Amount shall provide for automatic annual renewals be reduced to $28,104. The Letter of Credit shall be (a) at sight, irrevocable and unconditional, (b) maintained in effect, whether through that date which is sixty replacement, renewal or extension, until one (601) days month after the Expiration Date expiration of the entire Lease Term (the “Letter of this Lease. In the event the letter Credit Expiration Date”) and Tenant shall deliver a new Letter of credit is issued with an annual Credit or certificate of renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty extension to Landlord at least thirty (2030) days prior to the then-scheduled expiration date of the letter Letter of creditCredit, without any action whatsoever on the part of Landlord, (c) subject to the International Standby Practices (1998–Rev) International Chamber of Commerce Publication #590, (d) acceptable to Landlord in its sole discretion, and (e) fully assignable by Landlord and permit partial draws. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s sole discretion, and shall provide, among other things, in effect that: (1) Landlord, or its then Landlord managing agent, shall have the right to draw down an amount up to the full face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) statement that such amount is due to Landlord under the terms and conditions of this Lease, it being understood that if Landlord or its managing agent be a limited liability company, corporation, partnership or other entity, then such statement shall be signed by a managing member (if a limited liability company), an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (2) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (3) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part (or cause at Tenant’s expense a substitute letter of credit to be delivered, as applicable), to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new Landlord. Tenant hereby acknowledges and agrees that Landlord is entering into this Lease in material reliance upon the ability of Landlord to draw upon the Letter of Credit upon the occurrence of any default on the part of Tenant hereunder which continues beyond any applicable notice and cure periods. Tenant further acknowledges and agrees that if Landlord cannot draw upon the Letter of Credit within the times and in the manner as anticipated by Landlord herein, Landlord shall suffer irreparable damage, harm and injury. From time to time during the Term of this Lease it is anticipated by the parties that the Letter of Credit will need to be amended, modified and, possibly reissued. Landlord and Tenant hereby covenant and agree to cooperate with one another to promptly effectuate any such amendments, modifications and new issuances, including without limitation, executing and submitting to the Issuer any and all documents or instruments as may be reasonably required to effectuate same. Each and every time during the Term of this Lease there is a change in the identity or address of the parties, including without limitation, any change in the identity of Landlord due to the sale, transfer or other conveyance by Landlord of its rights and interests in, to and under this Lease to any other party, person or entity, the Letter of Credit shall immediately be amended or reissued to reflect such changes and the parties hereby agree to execute and submit to the Issuer such further applications, documents and instruments as may be necessary to effectuate same. It is the intention of the parties that each and every successor and assign of both Landlord and Tenant be bound by and subject to the terms and provisions of this Article 27. Landlord may, at any time and without notice to Tenant and without first obtaining Tenant’s consent thereto, assign all or any portion of its interest in and to hold the Letter of Credit to another party, person or entity, regardless of whether or not such amount assignment is separate from or as a part of the Security Deposit pursuant assignment by Landlord of its rights and interests in and to Section 4.3 of this Lease. Upon any default by TenantIf, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full any such application of all or partial compensation for the default. If any portion part of the letter Letter of credit is drawn after a default by TenantCredit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall within five (5) days after written demand by thereafter provide Landlord restore with additional letter(s) of credit in an amount equal to the letter of credit. Failure to so restore said deficiency (or a replacement letter of credit within said five in the total amount of the LC Amount and each such additional (5or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Tenant fails to do so, notwithstanding anything to the contrary contained in Article 19 hereof, the same shall constitute an incurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Letter of Credit Expiration Date, Landlord will accept a renewal thereof or substitute letter of credit (such renewal or substitute letter of credit to be in effect not later than thirty (30) days prior to the expiration thereof), which shall be irrevocable and automatically renewable as above provided through the Letter of Credit Expiration Date upon the same terms as the expiring letter of credit or such other terms as may be acceptable to Landlord in its sole discretion. However, if the Letter of Credit is not timely renewed or a substitute letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and terms set forth in this Article 27, Landlord shall have the right to present such Letter of Credit to the bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease. Partial drawings If there shall occur a default under this Lease as set forth in Article 19 of this Lease, Landlord may, but without obligation to do so, draw upon said letter the Letter of credit Credit, in part or in whole, to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default. Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, regardless of whether any dispute exists between Tenant and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be permitteddeemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. In Landlord and Tenant acknowledge and agree that in no event or circumstance shall the event that Tenant has not been in default under Letter of Credit or any renewal thereof or substitute therefor be (i) deemed to be or treated as a “security deposit” within the Lease meaning of California Civil Code Section 1950.7 (beyond as supplemented, amended, replaced and substituted from time to time), (ii) subject to the expiration terms of any applicable cure periodsuch Section 1950.7 (as supplemented, amended, replaced and substituted from time to time), or (iii) at any intended to serve as a “security deposit” within the meaning of such Section 1950.7 (as supplemented, amended, replaced and substituted from time during the Term hereofto time). The parties hereto recite that, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments the Letter of rent due under Credit, (x) the LeaseLetter of Credit is not intended to serve as a security deposit and such Section 1950.7 (as supplemented, then upon the written request of Tenantamended, Landlord shall authorize in writing consecutive reductions replaced and substituted from time to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36thtime), and forty-eighth any and all other laws, rules and regulations applicable to security deposits in the commercial context (48th“Security Deposit Laws”) months shall have no applicability or relevancy to the Letter of Credit and (y) to the Termextent permitted by law, Tenant waives any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws.

Letter of Credit. In addition to lieu of a cash deposit by Tenant for the Security Deposit and as security hereunderDeposit, Tenant shall deliver to Landlordmay deposit with Landlord a clean, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by and unconditional standby letter of credit issued by and drawn upon any commercial bank reasonably acceptable to Landlord with offices for banking purposes in the amount City of One New York and having a net worth of not less than Five Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars Million ($166,229.00). Said 500,000,000) Dollars, which letter of credit shall be in the form annexed hereto as Exhibit 7, or in another form satisfactory to Landlord (the "Letter of Credit") and with in the substance amount of Exhibit F attached heretothe Security Deposit set forth in Article 1 hereof. In addition, the Letter of Credit shall provide that it is assignable by Landlord without charge and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: either (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that expire on the date which is sixty (60) days after the Expiration Date of the Term expiration or earlier termination of this LeaseLease (the ALC Date@) or (ii) be automatically self-renewing until the LC Date. In the event the letter of credit At any time that Tenant is issued with an annual renewal obligation in default under this Lease beyond any applicable notice and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of creditgrace period, then Landlord shall have the right to draw down the full credit to the extent of the default and apply the proceeds or any part thereof in accordance with the provisions of this Article 32. Landlord shall also have the right to draw down the entire amount of such letter the credit in the event that Landlord fails to receive a replacement Letter of credit and Credit on or prior to hold such amount as part the thirtieth (30th) day preceding the expiration date thereof or if Tenant holds over in the Premises without the consent of Landlord more than thirty (30) days after the Security Deposit pursuant to Section 4.3 expiration or earlier termination of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, If Landlord shall be entitled to draw upon said letter have drawn down the Letter of credit by Credit and applied all or a portion thereof in accordance with the issuance terms of Landlord’s sole written demand to the issuing financial institution. Such draw this Article 32, then Tenant shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by deposit with Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days business days' after written demand notice from Landlord, either a sufficient amount of cash to bring the balance of the cash held by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions Article 32 to the principal amount of the letter Security Deposit or a replacement Letter of credit in Credit. The failure by Tenant to deposit such additional amount within the amount foregoing time period shall be deemed a material default pursuant to Article 17 of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termthis Lease.

Letter of Credit. In addition On or before the date Landlord closes the Construction Loan, Landlord shall provide to the Security Deposit and Tenant, as security hereunderfor the payment of the Inducement Allowance, Tenant shall deliver to Landlordthe Moving Allowance, concurrently with Tenant’s execution of this Leasethe Termination Fee and the Late Delivery Amount, as the case may be, an irrevocable stand-by letter letter(s) of credit credit, in substantially the form of Exhibit K attached hereto and made a part hereof, in the aggregate amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Ten Million Dollars ($166,229.00)10,000,000) issued by SunTrust Bank, U.S. Bank or such other bank selected by Landlord. Said letter Such letter(s) of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed provide for an expiration date at least one year from the date of December 31its issuance; provided, 2005however, or if Tenant, at least thirty (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (2030) days prior to the current expiration date, does not receive written confirmation from the issuing bank that the letter(s) of credit has been renewed for an additional year (or the bank provides notice of non-renewal), or if for any reason it not renewed on or before thirty (30) days prior to its then current expiration date, then-scheduled expiration date of the letter , unless Landlord otherwise provides a substitute letter(s) of credit, then Landlord Tenant shall have the unconditional right to draw upon the full amount of such letter letter(s) of credit and to hold such amount as part the extent of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any unpaid portion of the letter Inducement Allowance, the Moving Allowance, Termination Fee and the Late Delivery Amount, as the case may be. In all events, Tenant’s right to draw on any such letter(s) of credit shall terminate upon payment in full of the Inducement Allowance, the Moving Allowance and (if applicable) the Termination Fee or the Late Delivery Amount and Tenant shall promptly return the letter(s) of credit to Landlord. Such letter(s) of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has security for and not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount limitation of the letter of credit in Landlord’s obligation to pay the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars Inducement Allowance, the Moving Allowance and ($33,246.00if applicable) each upon the expiration of Termination Fee or the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermLate Delivery Amount.

Letter of Credit. In addition to (a) Within five (5) days after the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s execution date of this Lease, an irrevocable stand-Tenant will deliver to Landlord a Letter of Credit issued by letter of credit a bank reasonable acceptable to Landlord (the “Bank”) in the amount of Eighty One Thousand Seven Hundred Sixty Six Thousand Fifty Two Hundred Twenty-Nine Dollars and Fifty Two Cents ($166,229.0081,752.52), (the “LOC Amount”), as security for Tenant’s performance of all of Tenant’s covenants and obligations under this Lease, including but not limited to Base Rent, Additional Rent, and all other sums owed under the Lease, provided, however, that neither the Letter of Credit nor any Letter of Credit proceeds therefrom will be deemed an advance rent deposit or an advance payment of any other kind, or a measure or limitation of Landlord’s damages or constitute a bar or defense to any of the Landlord’s other remedies under this Lease or at Law upon Tenant’s default. The Letter of Credit will be maintained in effect from the date of this Lease through ninety (90) days after the expiration or earlier termination of the Term. On or prior to the expiration of such ninety (90) day period, Xxxxxxxx will return to Tenant the Letter of Credit (unless presented for payment as provided herein) and any Letter of Credit proceeds then held by Landlord (other than those held for application by Landlord as provided herein, including application to cure any failure by Tenant to restore the Premises as required by this Lease upon the surrender of the Premises). Said letter In no event will any such return be construed as an admission by Landlord that Xxxxxx has performed all of credit shall its obligations pursuant to the Lease. Landlord will not be in form required to segregate the Letter of Credit proceeds from its other funds and no interest will accrue or be payable to Tenant with respect thereto. Landlord may (but is not required to) draw upon the substance Letter of Exhibit F attached hereto, Credit and issued by Silicon Valley Bank use the Letter of Credit proceeds or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: any portion thereof (i) be issued with a fixed expiration date to cure any Event of December 31, 2005Default by Tenant which continues beyond the period of notice and opportunity to cure provided in this Lease, or (ii) to compensate Landlord for any damage Landlord incurs as a result of Tenant’s failure to perform any of its obligations hereunder following expiration of the notice period provided in this Lease; or (iii) to provide additional security in the event the Letter of Credit has not been replaced at least ten (10) days before expiration of its term. Use of the Letter of Credit proceeds will not constitute a bar or defense to any of Landlord’s other remedies under this Lease. In such event and upon written notice from Landlord to Tenant specifying the amount of the Letter of Credit proceeds so utilized by Landlord and the particular purpose for which such amount was applied, Tenant will immediately deliver to Landlord an amendment to the Letter of Credit or a replacement thereof in an amount equal to one hundred percent (100%) of the LOC Amount. Tenant’s failure to deliver such amendment or replacement to Landlord within five (5) days of Landlord’s notice will constitute an Event of Default hereunder. No lessor under any ground or underlying lease or holder of or beneficiary under a mortgage or deed of trust, nor any purchaser at any judicial or private foreclosure sale of the Project or any portion thereof will be responsible to Tenant for such Letter of Credit or any Letter of Credit proceeds unless such lessor, holder or purchaser has actually received the Letter of Credit or Letter of Credit proceeds. (b) The Letter of Credit will be issued on an annual basis, and maintained in full force and effect for the entire Term of the Lease, and must provide: (i) that Landlord may make partial and multiple draws thereunder, up to the face amount thereof; (ii) that Landlord may draw upon the Letter of Credit up to the full amount thereof, as determined by Landlord, and the Bank will pay to Landlord the amount of such draw upon receipt by the Bank of a sight draft signed by Xxxxxxxx and accompanied by a Landlord’s certificate as provided for in the Letter of Credit. In the event Landlord assigns or other transfers its interest in this Lease, the Letter of Credit will be freely transferable by Landlord, without charge and without recourse, to the assignee or transferee of such interest and the Bank will confirm the same to Landlord and such assignee or transferee. In the event that the Bank fails to notify Landlord that the Letter of Credit will not be renewed and Tenant has not delivered to Landlord, at least thirty (30) days prior to the relevant renewal date, a replacement Letter of Credit meeting the requirements set forth herein, then Landlord will be entitled to draw on the Letter of Credit as provided above, and will hold and apply the proceeds of such draw pursuant to this Section 31 of this Lease. (c) Xxxxxxxx’s draw upon the Letter of Credit Proceeds are in addition to any rights it has to draw upon any Security Deposit in this Lease. Furthermore, in addition to the reasons set forth above, Landlord may draw upon and execute on the Letter of Credit upon the occurrence of an Event of Default pursuant to Section 18 of the Lease in order to recover unamortized brokers commissions, unamortized Tenant Improvement costs, and any free Rent or other concessions offered to Tenant. Tenant’s failure to deliver, maintain, or renew the Letter of Credit pursuant to the obligations of this Section 31 will be deemed an Event of Default. (d) Provided that not more than two (2) uncured Events of Default (or event which with the giving of notice or the passage of time, or both, would constitute an Event of Default) have occurred during the Term on the part of Tenant, the Tenant shall provide have the right to reduce Letter of Credit to Forty Thousand Eight Hundred Seventy Six Dollars and Twenty Six Cents ($40,876.26) upon expiration of the fifth (5th) full calendar month of the Term. Notwithstanding the foregoing, if at any time after a reduction of the Letter of Credit as provided in this Section 31, Tenant shall fail to pay any amount due hereunder and such failure shall not be cured within five (5) days following notice thereof to Tenant by Landlord, Tenant shall, without further demand or request on the part of Landlord, increase the Letter of Credit to Eighty One Thousand Seven Hundred Fifty Two Dollars and Fifty Two Cents ($81,752.52), as a condition to thereafter curing such Event of Default. Any failure to so increase the Letter of Credit as required hereunder following the occurrence of an Event of Default on the part of Tenant shall constitute a separate non-curable Event of Default. Furthermore, upon and following any Event of Default on the part of Tenant hereunder, whether or not cured by Xxxxxx, Tenant shall have no right thereafter to reduce the Letter of Credit as may otherwise be provided in Section 31. (e) In the event of a draw on the Letter of Credit, any proceeds thereof to the extent not otherwise utilized by Landlord as provided hereunder, shall be returned to the drawing Bank if the Letter of Credit is still in effect, or if the Letter of Credit is not then in effect or shall by its terms expire within ninety (90) days after such draw, the funds shall be held by Landlord as a security deposit hereunder (the “Security Deposit”). If applicable, the Security Deposit will be held by Landlord as security for automatic annual renewals through the faithful performance by Tenant of all of the provisions of this Lease to be performed or observed by Xxxxxx. If Tenant fails to pay any Rent due hereunder, or otherwise defaults with respect to any provision of this Lease, Landlord may at its option, and without prejudice to any other remedy it has, apply or retain all or any portion of the Security Deposit for the payment of any Rent in default or the payment of any other sum to which Landlord may become obligated by Tenant’s default, or to compensate Landlord for any loss or damage recoverable under the Lease which Landlord may suffer thereby. If Landlord so uses or applies all or any portion of the Security Deposit, then within ten (10) days after written demand therefore, Tenant will deposit cash, or a replacement or amended Letter of Credit with Landlord in an amount sufficient to restore the Security Deposit to the full amount thereof. Tenant’s failure to restore the Security Deposit will constitute an Event of Default on the part of Tenant. Landlord’s application or retention of the Security Deposit will not constitute a waiver of Tenant’s default to the extent that date which is sixty the Security Deposit does not fully compensate Landlord for all losses or damages incurred by Landlord in connection with such default and will not prejudice any other rights or remedies available to Landlord under this Lease or by law. Landlord will not be required to keep the Security Deposit separate from its general accounts. If Tenant performs all of Tenant’s obligations pursuant to this Lease, the Security Deposit or so much of the Security Deposit as has not been applied by Landlord, will be returned, without payment of interest or any other increment for its use, to Tenant (60or, at Landlord’s option, to the last assignee, if any, of Xxxxxx’s interest hereunder) within forty-five (45) days after the Expiration Date latter of: (i) expiration of the Term of this Lease; or (ii) vacation of the Premises by Xxxxxx. In the event the letter of credit No trust relationship is issued created between Landlord and Tenant with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior respect to the then-scheduled expiration date of the letter of credit, then Security Deposit. Landlord shall have the right to draw the full amount of such letter of credit and to hold such amount as part of will deliver the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent the purchaser or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance assignee of Landlord’s sole written demand interest in the Premises and thereupon Landlord will be discharged from any further liability with respect to the issuing financial institutionSecurity Deposit. Such draw shall be in an amount Landlord and Tenant agree that Landlord may claim those sums reasonably necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined any other foreseeable or unforeseeable loss or damage caused by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount act or omission of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant or Tenant’s default (as determined pursuant officers, agents, employees, independent contactors, licensees, invitees or others coming into the Project, Building, or the Premises with the express or implied consent of Tenant or otherwise. Xxxxxx agrees and acknowledges that no interest will be paid to Tenant on the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the TermSecurity Deposit.

Letter of Credit. In addition to the Security Deposit and as security hereunder, Tenant shall deliver to Landlord, concurrently with Tenant’s 's execution of this Lease, an irrevocable stand-by letter of credit in the amount of One Hundred Sixty Six Thousand Two Million Two Hundred Twenty-Nine Thousand Dollars ($166,229.002,200,000.00). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank (or by another such other financial institution located in Orange County and which is acceptable to LandlordLandlord in its sole and absolute discretion). The letter of credit shall either: provide for automatic yearly renewals throughout the Term of this Lease, as the same may be extended. In the event (i) be issued with a fixed the issuer of the letter of credit elects not to renew the letter of credit beyond the then-current expiration date of December 31, 2005thereof, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit includes a final expiration date that precedes the date which is issued thirty (30) days beyond the then-scheduled Expiration Date of this Lease, then, in either instance, unless Tenant provides Landlord with an annual renewal obligation and the a replacement letter of credit is not renewed by satisfying the issuing financial institution on or before twenty requirements of this Section 4.4 at least fifteen (2015) days prior to the such then-scheduled current expiration date or final expiration date, as applicable, of the letter of credit, then Landlord shall have the right be entitled to draw upon the full amount of such letter of credit in full and to thereafter hold such amount funds as security for full and faithful performance of Tenant's obligations under this Lease (and, upon such draw, such funds shall be automatically added to the Security Deposit described in Section 4.3 above and shall thereupon be held by Landlord in accordance with and subject to the terms and conditions of said Section 4.3 as if such funds were part of the original Security Deposit pursuant provided to Section 4.3 of Landlord under this Lease); provided however, that upon Tenant's replacement of the expired letter of credit with a letter of credit satisfying the obligations set forth herein, such funds shall be returned to Tenant by Landlord promptly following Landlord's receipt of such replacement letter of credit. Upon any default by TenantTenant which has not been cured within the applicable time period, including specifically Tenant’s 's failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure periodbelow, Landlord shall be entitled to draw upon said letter of credit in the amount of the default(s) by the issuance of Landlord’s 's sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or of any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that (i) Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that (ii) Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the LeaseLease during the applicable twelve (12)-month period which precedes each of the following dates for reductions to the letter of credit, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit credit, each of such reductions in the amount of Thirty Three Four Hundred Forty Thousand Two Hundred Forty-Six Dollars ($33,246.00) each 440,000.00), upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th), and the sixtieth (60th) months during the Term. In addition, in the event that: (A) Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, (B) Tenant has not at any time been more than five (5) days late with respect to any payments of rent due under the Lease during the prior twelve (12) month period, and (C) Tenant shall demonstrate by the delivery to Landlord of its audited financial Statements that Tenant has then achieved four consecutive quarters of positive net income and a tangible net worth in excess of Twenty Million Dollars ($20,000,000.00) (as determined by generally accepted accounting principles, consistently applied, and issued by a nationally recognized accounting firm), then, upon written request of Tenant, given at any time after the date which is thirty-six (36) months following the Commencement Date, Landlord shall authorize a full exoneration and release of the Termletter of credit.

Letter of Credit. In addition to Simultaneously with the Security Deposit execution and as security hereunderdelivery of this Lease, Tenant shall deliver to LandlordLandlord a clean, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by letter of credit in favor of Landlord in the amount Letter of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars Credit Amount ($166,229.00). Said letter of credit shall be as defined in Section 1.2) in the form attached hereto as Exhibit D or otherwise satisfactory in form and with the substance of Exhibit F attached hereto, content to Landlord and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable other FDIC insured bank reasonably satisfactory to Landlord. The During the Term hereof, and any extensions thereof, and for 60 days after the expiration of the Term, or for so long thereafter as Tenant is in possession of the Premises or has unsatisfied obligations hereunder to Landlord, the letter of credit shall either: (i) be issued with a fixed expiration date held to ensure the full and timely performance of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of Tenant’s obligations under this Lease. In ; which letter of credit may, following a default by Tenant beyond any applicable notice period, be drawn upon by Landlord and applied from time to time against outstanding obligations of Tenant hereunder without further notice or demand; provided, however, if any such notice is prohibited, stayed or barred by applicable law without obtaining court, trustee or other party’s approval (e.g., the automatic stay in the event of a bankruptcy), no notice shall be required for Landlord to draw upon the letter of credit is issued with an annual renewal obligation credit. Tenant shall have no right to require Landlord to so draw and apply the letter of credit, nor shall Tenant be entitled to credit is not renewed by the issuing financial institution on same against rents or before twenty (20) other sums payable hereunder. During the entire Term hereof, including any extension thereof, Tenant shall cause said letter of credit to be renewed, in identical form to that delivered herewith, no later than 30 days prior to the then-scheduled expiration date of expiration of same. Without limiting any other remedies of Landlord, in the event that Tenant fails to renew any letter of creditcredit given hereunder at least 30 days prior to the date of expiration thereof, then Landlord shall have the right to draw down the full entire amount of such said letter of credit and to hold such amount sums as part of the Security Deposit pursuant to Section 4.3 of this Leasea cash deposit. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 If and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said letter of credit by the issuance of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate extent that Landlord for all damages incurred thereby, as determined by Landlord in its sole and absolute discretion, and if makes such amount cannot be readily determined by Landlord, then the full amount use of the letter of credit can be drawn credit, or any part thereof, the sum so applied by Landlord pending determination (from cash or from a drawing on the letter of said amountcredit) shall be restored or replenished by delivery of a new letter of credit or additional letter of credit equal to the difference) by Tenant upon notice from Landlord, and failure to so restore or replenish (within the grace period applicable to Fixed Rent hereunder) shall be a default hereunder giving rise to all of Landlord’s rights and remedies applicable to a default in the payment of rent. In the event of a change of circumstance relating to the bank issuing the letter of credit, or Landlord otherwise reasonably believes the financial conditions of the issuing bank has been degraded, Landlord reserves the right to require Tenant to replace the letter of credit from time to time with a substitute similar letter of credit issued by another bank satisfactory to Landlord. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s(i) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant under this Lease. Partial drawings upon said letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at beyond any time been more than five (5) days late more than once during the applicable previous twelve (12)-month grace period with respect to under any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter terms and conditions of credit this Lease; and (ii) the Tenant originally named herein (or a Permitted Transferee) continues to occupy and operate in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration not less than 40,348 rentable square feet of the twelfth Premises (12thexcluding the Basement Space), twenty-fourth (24th)the Letter of Credit Amount shall be reduced, thirty-sixth (36th)upon Tenant’s written request, and forty-eighth (48th) months to $231,980.00 at the end of the Termseventh (7th) full Lease Year.

Letter of Credit.  (A) In addition lieu of the Security Deposit, at Tenant’s election, Tenant may deposit with Landlord and maintain during the Term, a Letter of Credit in an undrawn face amount equal to $65,373.75 (as the same may be reduced pursuant to Section 20.27(F), the “LC Amount”) as partial collateral for Tenant’s obligations under this Lease. Upon the occurrence of an Event of Default under this Lease that remains uncured after receipt of written notice and expiration of the applicable cure period, Landlord may, but shall not be required to, draw upon the Letter of Credit (in whole or in part) and apply the cash proceeds thereof to the Security Deposit obligations due from Tenant under this Lease and to compensate Landlord for the Claims arising in connection with such uncured Event of Default (or any other Event of Default under this Lease that remains uncured after receipt of written notice and expiration of the applicable cure period). Any amount drawn by Landlord shall not be deemed: (a) to fix or determine the amounts to which Landlord is entitled to recover under this Lease or otherwise; (b) to waive or cure any default under this Lease; or (c) to limit or waive Landlord’s right to pursue any remedies provided for in this Lease.  (B) Tenant covenants as security hereunderfollows: (a) on or before thirty (30) days prior to the expiration date of the then issued and outstanding Letter of Credit, Tenant shall deliver to deposit with Landlord a replacement Letter of Credit in the LC Amount; (b) if all or any portion of the Letter of Credit is drawn against by Landlord, concurrently Tenant shall, within five (5) business days after written demand by Landlord, deposit with Tenant’s execution Landlord a replacement or supplementary Letter of Credit such that at all times during the term of this LeaseLease and, an irrevocable stand-by letter of credit in the amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars ($166,229.00subject to Section 20.27(G). Said letter of credit shall be in form and with the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date Date, Landlord shall have the ability to draw on one or more Letters of Credit totaling, in the aggregate, the LC Amount; and (c) following an Issuer Revocation, Tenant shall obtain a replacement Letter of Credit in the LC Amount from another Issuer within fifteen (15) business days of Landlord’s written demand therefor. If Tenant fails to timely    perform any of the Term of foregoing, then in addition to any other rights and remedies available under this Lease. In , Landlord may immediately draw upon the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date full amount of the letter then issued and outstanding Letter of creditCredit.  (C) Upon the issuance of a replacement Letter of Credit, then Landlord shall have the right to draw solely on such replacement Letter of Credit and Landlord shall have no right to draw against the full Letter of Credit which is replaced by such replacement Letter of Credit.  (D) Tenant shall have the right to deposit with Landlord one or more Letters of Credit to satisfy the requirements of this Section 20.27, so long as the aggregate undrawn face amount of such letter all issued and outstanding Letters of credit Credit equal the LC Amount.  (E) If Landlord draws on a Letter of Credit, the cash proceeds thereof not used to compensate Landlord for amounts due to Landlord under this Lease by reason of an Event of Default under this Lease that remains uncured after receipt of written notice and to hold such amount as part expiration of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord period shall be entitled held by Landlord as an additional security deposit under this Lease and Landlord may, from time to draw upon said letter of credit by the issuance of Landlord’s sole written demand time, without prejudice to any other right or remedy, apply such cash proceeds to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question obligations due from Tenant under this Lease and to compensate Landlord for all the actual damages suffered or incurred thereby, as determined by it in connection with such uncured Event of Default (or any other Event of Default under this Lease that remains uncured after receipt of written notice and expiration of the applicable cure period). The holding of such cash proceeds by Landlord shall not limit or stay Tenant’s obligation hereunder to cause to be issued, subject to Section 20.27(G), for the entire Term, plus (60) days after the Expiration Date, a Letter of Credit in its sole the LC Amount. Absent an Event of Default under this Lease that remains uncured after receipt of written notice and absolute discretion, and if such amount cannot be readily determined by Landlord, then the full amount expiration of the letter applicable cure period (except an Event a Default that would be fully cured by the posting of credit can be drawn a Letter of Credit in the LC Amount), upon Landlord’s receipt of a Letter of Credit in the LC Amount, any such cash proceeds then held by Landlord pending determination shall be returned to Tenant. If requested by Tenant, Landlord shall make such cash proceeds available to collateralize a replacement Letter of said amountCredit or supplemental Letter of Credit pursuant to a written agreement with the applicable Issuer, whereby Landlord shall agree to disburse such cash proceeds to the applicable Issuer upon such Issuer’s irrevocable and unconditional commitment to issue the applicable replacement Letter of Credit or supplemental Letter of Credit upon its receipt of such cash proceeds. Notwithstanding the foregoing, while Landlord shall not be required to make such cash proceeds available if an uncured Event of Default then exists unless the amount posting of any such draw shall be determined in Landlord’s sole and absolute discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant to the applicable provisions replacement or supplemental Letter of Article XIV Credit would cure all outstanding Events of this Lease), then Landlord shall promptly refund any such excess to TenantDefault. Any such draw shall be without waiver or any rights Landlord may have If Tenant is not in default under this Lease or at law or in equity as a result of the defaultExpiration Date, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default cash proceeds then held by Tenant, Landlord shall be returned to Tenant shall within five thirty (530) days after written demand by Landlord restore following the letter Expiration Date.  (F) Provided no Event of credit. Failure to so restore said letter of credit within said five (5) days shall be a default by Tenant Default under this Lease. Partial drawings upon said letter Lease that remains uncured after receipt of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, written notice and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th)applicable cure period then exists, twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months on the first anniversary of the Term.Rent Commencement Date, the LC Amount shall be reduced to $0.00. If an uncured Event of Default does exist on such anniversary date, such reduction shall be stayed until such time as no uncured Event of Default then exists.  (G) As used in this this Section 20.27, the following shall have the following meanings: 

Letter of Credit. In addition From and after the date hereof until the date (the “Release Date”) the Indemnitor pays the Escrowed Amount in cash to the Security Deposit and Escrow Account in accordance with Section 4.1 (or the date an Early Payment is made) if a Change of Control of WABCO or ASE, as security hereunderapplicable, Tenant should occur, then, upon the demand of ASD, ASE (or any such successor) shall deliver be required to Landlord, concurrently with Tenant’s execution of this Lease, an irrevocable stand-by post a letter of credit or similar security obligation reasonably acceptable to ASD in respect of the Indemnifiable Losses under this Agreement in an amount of One Hundred Sixty Six Thousand Two Hundred Twenty-Nine Dollars equal to $880,000,000 USD ($166,229.00). Said letter of credit which amount shall be in form and with converted to EURO at the substance of Exhibit F attached hereto, and issued by Silicon Valley Bank or by another financial institution located in Orange County and which is acceptable to Landlord. The letter of credit shall either: (i) be issued with a fixed expiration date of December 31, 2005, or (ii) shall provide for automatic annual renewals through that date which is sixty (60) days after the Expiration Date of the Term of this Lease. In the event the letter of credit is issued with an annual renewal obligation and the letter of credit is not renewed by the issuing financial institution on or before twenty (20) days prior to the then-scheduled expiration date of the letter of credit, then Landlord shall have the right to draw the full amount of time such letter of credit and or similar security obligation is required to hold be posted, based on the prevailing exchange rate at the close of business on the second Business Day immediately prior to such amount as part of the Security Deposit pursuant to Section 4.3 of this Lease. Upon any default by Tenant, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.3 below and Tenant’s failure to cure the same within any applicable cure period, Landlord shall be entitled to draw upon said time such letter of credit by or similar security obligation is required to be posted) or, if an Initial Decision has been rendered, such other amount as may be specified in the issuance Initial Decision; provided, however, in the event of Landlord’s sole written demand to the issuing financial institution. Such draw shall be in an amount necessary to cure the default in question and to compensate Landlord for all damages incurred therebya Change of Control of WABCO or ASE, as determined by Landlord applicable, with ASD’s prior written consent (which may be withheld in its sole and absolute discretion, and if ) in lieu of ASE posting such amount cannot be readily determined by Landlord, then the full amount of the letter of credit can be drawn by Landlord pending determination or similar security obligation, the Person acquiring WABCO or ASE, as applicable, may provide to ASD and the other Indemnitees a full, unconditional and irrevocable guarantee of said amountthe Indemnitor’s obligations hereunder. Notwithstanding In the foregoingevent of a Change of Control of WABCO or ASE, while the amount as applicable, such letter of any such draw credit, similar security obligation or guarantee, as applicable, shall be determined posted or delivered at or prior to the consummation of such Change of Control. For the avoidance of doubt, the posting of such a letter of credit, similar security obligation or guarantee, as applicable, shall in Landlordno event relieve the Indemnitors (or its successors) with respect to any Indemnifiable Losses under this Agreement, and shall not result in a cap on the Indemnitor’s sole and absolute discretion as provided in (or any of its successors) Indemnifiable Losses with respect thereto. The letter of credit or similar security obligation shall provide that, without any further action on the foregoingpart of the Indemnitor, if funds thereunder shall be released to ASD (or, at the amount direction of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s default (as determined pursuant ASD, to the applicable provisions Indemnitee) upon such time as ASD provides a written instruction to the applicable bank or other issuer of Article XIV of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at law or in equity as a result of the default, as a setoff for full or partial compensation for the default. If any portion of the letter of credit is drawn after a default by Tenant, Tenant shall within five (5) days after written demand by Landlord restore the letter of credit. Failure , that any such Indemnitee is entitled to so restore said letter of credit within said five (5) days shall be a default by Tenant reimbursed for Indemnifiable Losses under this LeaseAgreement. Partial drawings upon said Upon such payment in full to the Indemnitees, the letter of credit shall be permitted. In the event that Tenant has not been in default under the Lease (beyond the expiration of any applicable cure period) at any time during the Term hereof, and provided further that Tenant has not at any time been more than five (5) days late more than once during the applicable previous twelve (12)-month period with respect to any payments of rent due under the Lease, then upon the written request of Tenant, Landlord shall authorize in writing consecutive reductions to the principal amount of the letter of credit in the amount of Thirty Three Thousand Two Hundred Forty-Six Dollars ($33,246.00) each upon the expiration of the twelfth (12th), twenty-fourth (24th), thirty-sixth (36th), and forty-eighth (48th) months of the Termterminated.