Common use of Terms of Letter of Credit Clause in Contracts

Terms of Letter of Credit. In lieu of the cash Security Deposit required by Paragraph 5 above, as additional consideration for value received and a further incentive to maintain Sublessor’s willingness to enter this Sublease, and as additional collateral so as to compensate Sublessor for future damages it may suffer by reason of Sublessee’s defaults hereunder, Sublessee shall deliver to Sublessor, not later than five (5) days after the date of Sublessee’s execution of this Sublease, an unconditional, clean, irrevocable letter of credit in the amount of $268,864.25 (“LC Amount”), which letter of credit shall be issued by a money-center bank (a bank which accepts deposits, maintains accounts, has a local Silicon Valley office which will negotiate a letter of credit and whose deposits are insured by the FDIC) reasonably acceptable to Sublessor, shall be for a term continuing through the last day of the forty-five (45) - day period following the Expiration Date (or shall contain an “evergreen” provision which provides that it automatically is renewed on an annual basis unless the issuer delivers forty-five (45) days’ prior written notice to Sublessor and Sublessee), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer of the letter of credit and a written statement signed by Sublessor or its authorized agent stating that Sublessor is entitled to draw down on the letter of credit, shall be freely transferable and shall be in a form and content reasonably acceptable to Sublessor. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee hereunder shall be referred to collectively herein as the “LC”. The LC shall provide for forty-five (45) days’ prior written notice to Sublessor of cancellation or material change thereof, and shall further provide that, in the event of any non-extension of the LC, Sublessor shall be entitled to present its written demand for payment of the entire face amount of the LC, and the proceeds therefrom so obtained shall be held as provided below. Sublessee shall pay all expenses, points and/or fees incurred by Sublessee in obtaining the LC. Additionally, upon a proposed sale or other transfer of any interest in the Premises, this Sublease or 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 Sublessee of the then outstanding LC, deliver to any such transferee, successor or assign a replacement LC on identical terms (except for the stated beneficiary) from the same issuer or another bank acceptable to Sublessor, in Sublessor’s reasonable discretion, naming the new sublessor as the beneficiary thereof. The LC shall not be mortgaged, assigned or encumbered in any manner whatsoever by Sublessee without Sublessor’s prior written consent, which may be withheld in Sublessor’s sole discretion.

Terms of Letter of Credit. In lieu The Issuing Bank shall issue, subject to the terms and conditions hereof (including but not limited to the conditions contained in Section 8.1 hereof) and at the request of the cash Security Deposit required Borrower, Letters of Credit for the account of the Borrower or a Restricted Subsidiary of the Borrower, all as more fully set forth in this Section 2.9. (i) No Letter of Credit shall be issued hereunder which has an expiry date later than the earlier of (i) one (1) year after the date of issuance thereof, or (ii) five (5) Business Days prior to the Termination Date; provided, however, that any Letter of Credit with a one (1) year maturity may provide for the renewal thereof for an additional one (1) year period, which shall in no event extend beyond five (5) Business Days prior to the Termination Date. (ii) Each Letter of Credit, whether now outstanding or hereafter issued by Paragraph 5 above, as additional consideration for value the Issuing Bank upon written request received and a further incentive to maintain Sublessor’s willingness to enter this Sublease, and as additional collateral so as to compensate Sublessor for future damages it may suffer by reason of Sublessee’s defaults hereunder, Sublessee shall deliver to Sublessor, the Issuing Bank not later less than five (5) days after Business Days prior to the proposed date of Sublessee’s execution of issuance pursuant to this SubleaseSection 2.9, an unconditional, clean, irrevocable letter of credit in the amount of $268,864.25 (“LC Amount”), which letter of credit has been or shall be issued in accordance with the Issuing Bank's then current practices relating to the issuance by a money-center bank (a bank which accepts depositsthe Issuing Bank of Letters of Credit, maintains accounts, has a local Silicon Valley office which will negotiate a including but not limited to the execution and delivery by the Borrower of an application for and/or confirmation of standby letter of credit and whose deposits are insured the payment by the FDIC) reasonably acceptable to Sublessor, shall be for a term continuing through the last day Borrower of the forty-five (45) - day period following the Expiration Date (customary processing fees. Each issuance or shall contain an “evergreen” provision which provides that it automatically is renewed on an annual basis unless the issuer delivers forty-five (45) days’ prior written notice to Sublessor and Sublessee), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer renewal of the letter a Letter of credit and a written statement signed by Sublessor or its authorized agent stating that Sublessor is entitled to draw down on the letter of credit, shall be freely transferable and shall be in a form and content reasonably acceptable to Sublessor. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee Credit hereunder shall be referred conditioned on (and be deemed to collectively herein be a representation and warranty by the Borrower as to) the “LC”. The LC shall provide for forty-five (45) days’ prior written notice to Sublessor of cancellation or material change thereof, and shall further provide following: that, at the time of such issuance or renewal, the representations and warranties contained in this Agreement are true and correct and no default set forth in Section 9 hereof shall have occurred and be continuing and no event which, with the giving of notice or lapse of time or both would become such a default, shall have occurred or shall have failed to occur and be continuing. (iii) In no event of any non-extension of shall the LC, Sublessor shall be entitled to present its written demand for payment of the entire aggregate undrawn face amount of the LCLetters of Credit plus any unreimbursed Draws exceed, at any one time, Three Million ($3,000,000) Dollars. The Stated Amount of each Letter of Credit, while the same is issued and outstanding, and any unreimbursed Draws under the proceeds therefrom so obtained Letters of Credit, shall reduce the maximum amount otherwise available for Loans under the Revolving Credit as set forth in Subsection 2.1(a) hereof. No Letters of Credit may be held as provided below. Sublessee shall pay all expenses, points and/or fees incurred by Sublessee in obtaining issued hereunder to the LC. Additionally, upon a proposed sale or other transfer extent that such issuance would cause the Aggregate Outstandings to exceed the lesser of any interest in (a) the Premises, this Sublease or 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 Sublessee maximum amount of the Revolving Credit then outstanding LC, deliver to any such transferee, successor in effect or assign a replacement LC on identical terms (except for b) the stated beneficiary) from the same issuer or another bank acceptable to Sublessor, in Sublessor’s reasonable discretion, naming the new sublessor as the beneficiary thereof. The LC shall not be mortgaged, assigned or encumbered in any manner whatsoever by Sublessee without Sublessor’s prior written consent, which may be withheld in Sublessor’s sole discretionthen current Incurrence Limitation.

Terms of Letter of Credit. In lieu The Letter of the cash Security Deposit required by Paragraph 5 above, as additional consideration for value received and Credit shall have a further incentive to maintain Sublessor’s willingness to enter this Sublease, and as additional collateral so as to compensate Sublessor for future damages it may suffer by reason of Sublessee’s defaults hereunder, Sublessee shall deliver to Sublessor, not later than five (5) days after term commencing upon the date of Sublessee’s execution of this SubleaseLease, an and continuing until the expiration of the initial Lease Term. The Letter of Credit shall be (i) issued by Silicon Valley Bank ("Bank") and "callable" by Landlord through a branch office of the Bank located in Santa Xxxxx County, and (ii) in a form containing the required provisions set forth in Sections 21.2.1 through 21.2.4 below. The premium or purchase price of, or any other Bank fees associated with, such Letter of Credit shall be paid by Tenant. The Letter of Credit shall, without limiting the foregoing, provide that: 21.2.1 Such Letter of Credit shall be transferable, irrevocable and unconditional, cleanso that Landlord, irrevocable or its successor(s) in interest, may at any time "call" for any portion of the then uncalled upon amount thereof without regard to and without the Bank inquiring as to the right or lack of right of the holder of said letter of credit to effect such calls or the existence or lack of existence of any defenses by Tenant with respect thereto; 21.2.2 Landlord agrees not to draw upon the Letter of Credit unless Landlord claims default by Tenant under the Lease after giving notice thereof to Tenant in accordance with the terms of this Lease and the expiration of any applicable cure period set forth in this Lease, but if Landlord does effect such a "draw," such "draw" amount may, at Landlord's option, be in the full amount of $268,864.25 (“LC Amount”)the Letter of Credit or a partial draw as necessary to compensate Landlord for such default. 21.2.3 Any failure or delay of Landlord to "draw" any portion of the Letter of Credit shall not act as a waiver of Landlord's right to do so at any time thereafter or constitute a waiver of any default with respect to the Lease. 21.2.4 Xxxxxx 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 Xxxxxx and Landlord as to Landlord's right to "draw" from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional upon this Lease or to justify the issuer of the Letter of Credit in failing to honor a draw upon such Letter of Credit in a timely manner. In the event Landlord is determined through any dispute resolution procedure agreed upon by the parties or by a court of competent jurisdiction to have improperly drawn on the Letter of Credit, then Tenant shall be entitled to receive a prompt refund of such amount from Landlord. Tenant hereby waives the provisions of Section 1950.7 of the California Civil Code, and all other provisions of law, now or hereafter in force, which letter provide that Landlord may claim from a security deposit (including the Letter of credit Credit) only those sums reasonably necessary to remedy defaults in the payment of rent, to repair damage caused by Tenant or to clean the Premises, it being agreed that Landlord may, in addition, claim those sums reasonably necessary to compensate Landlord for any other loss or damage, foreseeable or unforeseeable, caused by the act or omission of Tenant or any officer, employee, agent or invitee of Tenant. 22.1.5 Tenant shall be issued by a money-center bank (a bank which accepts deposits, maintains accounts, has a local Silicon Valley office which will negotiate a letter of credit solely responsible for any costs and whose deposits are insured expenses charged by the FDIC) reasonably acceptable to Sublessor, shall be for a term continuing through Bank in connection with the last day of the forty-five (45) - day period following the Expiration Date (or shall contain an “evergreen” provision which provides that it automatically is renewed on an annual basis unless the issuer delivers forty-five (45) days’ prior written notice to Sublessor and Sublessee), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer transfer of the letter of credit and a written statement signed by Sublessor or its authorized agent stating that Sublessor is entitled to draw down on the letter of credit, shall be freely transferable and shall be in a form and content reasonably acceptable to Sublessor. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee hereunder shall be referred to collectively herein as the “LC”. The LC shall provide for forty-five (45) days’ prior written notice to Sublessor of cancellation or material change thereof, and shall further provide that, in the event of any non-extension of the LC, Sublessor shall be entitled to present its written demand for payment of the entire face amount of the LC, and the proceeds therefrom so obtained shall be held as provided below. Sublessee shall pay all expenses, points and/or fees incurred by Sublessee in obtaining the LC. Additionally, upon a proposed sale or other transfer of any interest in the Premises, this Sublease or 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 Sublessee of the then outstanding LC, deliver from Landlord to any such transferee, successor or assign a replacement LC on identical terms (except for the stated beneficiary) from the same issuer or another bank acceptable to Sublessor, in Sublessor’s reasonable discretion, naming the new sublessor as the beneficiary thereof. The LC shall not be mortgaged, assigned or encumbered in any manner whatsoever by Sublessee without Sublessor’s prior written consent, which may be withheld in Sublessor’s sole discretionof Landlord.

Terms of Letter of Credit. In lieu (i) As of the cash Security Deposit Effective Date, Tenant is not obligated to provide Landlord with any Letter of Credit. If, after the Effective Date, Tenant is required by Paragraph 5 aboveto provide Landlord with a Letter of Credit, as additional consideration for value received Tenant shall maintain the Letter of Credit in favor of Landlord until the Obligor Group Obligations are performed in full. The Letter of Credit shall permit partial and full draws and shall permit drawing upon presentation of a draft drawn on the Issuer and a further incentive certificate signed by Landlord stating that an Event of Default has occurred under this Lease. The Letter of Credit shall be for an initial term of one year and shall be automatically renewed annually for successive terms of at least one year unless Landlord receives notice from the Issuer, by certified mail, at least 60 days prior to maintain Sublessor’s willingness to enter this Subleasethe expiry date then in effect that the Letter of Credit will not be extended for an additional one-year period. (ii) Tenant, and as additional collateral so as to compensate Sublessor for future damages it may suffer by reason of Sublessee’s defaults hereunderor a nominee thereof, Sublessee shall deliver to Sublessorshall, not later than five 15 days prior to the expiration of the term of the Letter of Credit, deliver to Landlord a replacement letter of credit, in form and substance and issued by an Issuer reasonably satisfactory to Landlord (5) days a “Replacement Letter”), such that the Letter of Credit or a Replacement Letter shall be in effect at all times after the date of Sublessee’s execution of this Sublease, an unconditional, clean, irrevocable letter of credit in Agreement until 15 days beyond the amount of $268,864.25 (“LC Amount”), which letter of credit shall be issued by a money-center bank (a bank which accepts deposits, maintains accounts, has a local Silicon Valley office which will negotiate a letter of credit and whose deposits are insured by the FDIC) reasonably acceptable to Sublessor, shall be for a term continuing through the last day end of the forty-five (45) - day period following the Expiration Date (or shall contain an “evergreen” provision which provides that it automatically is renewed on an annual basis unless the issuer delivers forty-five (45) days’ prior written notice to Sublessor and Sublessee), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer of the letter of credit and a written statement signed by Sublessor or its authorized agent stating that Sublessor is entitled to draw down on the letter of credit, shall be freely transferable and Term. Any Replacement Letter shall be in a form and content reasonably acceptable face amount at least equal to Sublessor. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee hereunder shall be referred to collectively herein as the “LC”. The LC shall provide for forty-five (45) days’ prior written notice to Sublessor of cancellation or material change thereof, and shall further provide that, in the event of any non-extension of the LC, Sublessor shall be entitled to present its written demand for payment of the entire face amount of the LCLetter of Credit. (iii) During the Term, Landlord shall hold the Letter of Credit as security for the performance by Tenant of all obligations on the part of Tenant under this Lease. If there is an Event of Default, Landlord shall have the right from time to time, without notice and without prejudice to any other remedy Landlord may have on account thereof, and upon presentation of a certificate of demand, to draw upon the proceeds therefrom Letter of Credit and apply any funds so obtained drawn to Landlord’s damages arising from, or to cure, any default by Tenant, whether such damages accrue before or after summary proceedings or other reentry by Landlord. If Landlord shall so apply any funds, Tenant shall immediately restore the Letter of Credit to the original face amount. Upon the expiration of the Term, provided no Event of Default is then continuing, Landlord shall return the Letter of Credit, or, if applicable, the remaining LC Proceeds, to Tenant. If Landlord conveys Landlord’s interest under this Lease, any Letter of Credit or, if applicable, the LC Proceeds, may be turned over and assigned by Landlord to Landlord’s grantee (or, at Landlord’s election, Tenant shall furnish Landlord’s successor with a new Replacement Letter showing such successor as payee, provided that the original Letter of Credit then outstanding shall be held as provided belowsimultaneously returned to Tenant). Sublessee shall pay all expensesFrom and after any such transfer, points and/or fees incurred by Sublessee in obtaining the LC. Additionallyassignment or return, upon a proposed sale or other transfer of any interest in the Premises, this Sublease or 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 Tenant agrees to Sublessee look solely to such grantee for proper application of the then outstanding LC, deliver to any such transferee, successor or assign a replacement LC on identical funds in accordance with the terms (except for of this Section and the stated beneficiary) from the same issuer or another bank acceptable to Sublessor, return thereof in Sublessor’s reasonable discretion, naming the new sublessor as the beneficiary thereof. The LC shall not be mortgaged, assigned or encumbered in any manner whatsoever by Sublessee without Sublessor’s prior written consent, which may be withheld in Sublessor’s sole discretionaccordance herewith.

Terms of Letter of Credit. In lieu of the cash Security Deposit required by Paragraph 5 above, as additional As consideration for value received and a further incentive to maintain Sublessor’s willingness to enter into this Sublease, and as a security deposit and additional collateral so as to compensate Sublessor for future damages it may suffer by reason of Sublessee’s defaults hereunder, Sublessee shall deliver to Sublessor, not later than five ten (510) days after the date of Sublessee’s execution of this Sublease, an unconditional, clean, irrevocable letter of credit in the amount of Fifty-Four Thousand Seven Hundred Thirty-Five and No/100 Dollars ($268,864.25 54,735.00) (“LC Amount”) (which sum is equal to three (3) months’ Base Rent payable by Sublessee for Months 16 through 24 of the Sublease Term), which letter of credit shall be issued by a money-center bank (a bank which accepts deposits, maintains accounts, has a local Silicon Valley office which will negotiate a letter of credit and whose deposits are insured by the FDIC) reasonably acceptable to Sublessor, shall be for a term continuing through the last day of the forty-five (45) - — day period following the Expiration Date (or shall contain an “evergreen” provision which provides that it automatically is renewed on an annual basis unless the issuer delivers forty-five (45) days’ prior written notice to Sublessor and Sublessee), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer of the letter of credit and a written statement signed by Sublessor or its authorized agent stating that Sublessor is entitled to draw down on the letter of credit, shall be freely transferable and shall be in a form and content reasonably acceptable to Sublessor. Notwithstanding the foregoing, provided Sublessee is not in default in the payment of Rent or the performance of its other obligations under this Sublease, Sublessee shall have the right to immediately terminate such letter of credit in the event the Master Lease shall terminate prior to the Expiration Date due to Sublessor’s breach of its obligations under Paragraph 35.B. below. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee hereunder shall be referred to collectively herein as the “LC”. The LC shall provide for forty-five (45) business days’ prior written notice to Sublessor of cancellation or material change thereof, and shall further provide that, in the event of any non-extension of the LCLC (if the term of the LC is for a period shorter than the Term of this Sublease) at least forty-five (45) business days prior to its expiration, the entire face amount shall automatically be paid to Sublessor, and Sublessor shall hold the funds so obtained for application to any current or future obligations of Sublessee. If for any reason such automatic payment does not occur in the event of a non-extension at least forty-five (45) days prior to expiration, Sublessor shall be entitled to present its written demand for payment of the entire face amount of the LC, and the proceeds therefrom so obtained shall be held as provided below. Sublessee shall pay all expenses, points and/or fees incurred by Sublessee in obtaining the LC. Additionally, upon a proposed sale or other transfer of any interest in the Premises, this Sublease or 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 Sublessee of the then outstanding LC, deliver to any such transferee, successor or assign a replacement LC on identical terms (except for the stated beneficiary) from the same issuer or another bank acceptable to Sublessor, in Sublessor’s reasonable discretion, naming the new sublessor as the beneficiary thereof. The LC shall not be mortgaged, assigned or encumbered in any manner whatsoever by Sublessee without Sublessor’s prior written consent, which may be withheld in Sublessor’s sole discretion.in

Terms of Letter of Credit. In lieu (i) Tenant provided Landlord with the Letter of Credit on December 1, 2012. Except as set forth herein, Tenant shall maintain the cash Security Deposit required by Paragraph 5 above, as additional consideration for value received Letter of Credit in favor of Landlord until the Obligor Group Obligations are performed in full. The Letter of Credit shall permit partial and full draws and shall permit drawing upon presentation of a draft drawn on the Issuer and a further incentive certificate signed by Landlord stating that an Event of Default has occurred under this Lease. The Letter of Credit shall be for an initial term of one year and shall be automatically renewed annually for successive terms of at least one year unless Landlord receives notice from the Issuer, by certified mail, at least 60 days prior to maintain Sublessor’s willingness to enter this Subleasethe expiry date then in effect that the Letter of Credit will not be extended for an additional one-year period. (ii) Tenant, and as additional collateral so as to compensate Sublessor for future damages it may suffer by reason of Sublessee’s defaults hereunderor a nominee thereof, Sublessee shall deliver to Sublessorshall, not later than five fifteen (515) days prior to the expiration of the term of the Letter of Credit, deliver to Landlord a replacement letter of credit, in form and substance and issued by an Issuer reasonably satisfactory to Landlord (a “Replacement Letter”), such that the Letter of Credit or a Replacement Letter shall be in effect at all times after the date of Sublessee’s execution of this Sublease, an unconditional, clean, irrevocable letter of credit in Agreement until fifteen (15) days beyond the amount of $268,864.25 (“LC Amount”), which letter of credit shall be issued by a money-center bank (a bank which accepts deposits, maintains accounts, has a local Silicon Valley office which will negotiate a letter of credit and whose deposits are insured by the FDIC) reasonably acceptable to Sublessor, shall be for a term continuing through the last day end of the forty-five (45) - day period following the Expiration Date (or shall contain an “evergreen” provision which provides that it automatically is renewed on an annual basis unless the issuer delivers forty-five (45) days’ prior written notice to Sublessor and Sublessee), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer of the letter of credit and a written statement signed by Sublessor or its authorized agent stating that Sublessor is entitled to draw down on the letter of credit, shall be freely transferable and Term. Any Replacement Letter shall be in a form and content reasonably acceptable face amount at least equal to Sublessor. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee hereunder shall be referred to collectively herein as the “LC”. The LC shall provide for forty-five (45) days’ prior written notice to Sublessor of cancellation or material change thereof, and shall further provide that, in the event of any non-extension of the LC, Sublessor shall be entitled to present its written demand for payment of the entire face amount of the LCLetter of Credit. (iii) During the Term, Landlord shall hold the Letter of Credit as security for the performance by Tenant of all obligations on the part of Tenant under this Lease. If there is an Event of Default, Landlord shall have the right from time to time, without notice and without prejudice to any other remedy Landlord may have on account thereof, and upon presentation of a certificate of demand, to draw upon the proceeds therefrom Letter of Credit and apply any funds so obtained drawn to Landlord’s damages arising from, or to cure, any default by Tenant, whether such damages accrue before or after summary proceedings or other reentry by Landlord. If Landlord shall so apply any funds, Tenant shall immediately restore the Letter of Credit to the original face amount. Upon the expiration of the Term, Landlord shall return the Letter of Credit, or, if applicable, the remaining LC Proceeds, to Tenant. If Landlord conveys Landlord’s interest under this Lease, any Letter of Credit or, if applicable, the LC Proceeds, may be turned over and assigned by Landlord to Landlord’s grantee (or, at Landlord’s election, Tenant shall furnish Landlord’s successor with a new Replacement Letter showing such successor as payee, provided that the original Letter of Credit then outstanding shall be held as provided belowsimultaneously returned to Tenant). Sublessee shall pay all expensesFrom and after any such transfer, points and/or fees incurred by Sublessee in obtaining the LC. Additionallyassignment or return, upon a proposed sale or other transfer of any interest in the Premises, this Sublease or 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 Tenant agrees to Sublessee look solely to such grantee for proper application of the then outstanding LC, deliver to any such transferee, successor or assign a replacement LC on identical funds in accordance with the terms (except for of this Section and the stated beneficiary) from the same issuer or another bank acceptable to Sublessor, return thereof in Sublessor’s reasonable discretion, naming the new sublessor as the beneficiary thereof. The LC shall not be mortgaged, assigned or encumbered in any manner whatsoever by Sublessee without Sublessor’s prior written consent, which may be withheld in Sublessor’s sole discretionaccordance herewith.

Terms of Letter of Credit. In lieu of the cash Security Deposit required by Paragraph 5 above, as additional As consideration for value received and a further incentive to maintain Sublessor’s 's willingness to enter into this Sublease, and as additional collateral so as to compensate Sublessor for future damages it may suffer by reason of Sublessee’s 's defaults hereunder, Sublessee shall deliver to Sublessor, not later than five (5) days after on or before the date of Sublessee’s execution of this SubleaseCommencement Date, an unconditional, clean, irrevocable letter of credit without documents (i.e., there shall be no obligation on Sublessor's part to present anything to issuer but a sight draft and the written statement described herein) in the amount of One Hundred Sixty-Six Thousand Six Hundred Eight and No/100 Dollars ($268,864.25 166,608.00) (“"LC Amount”"), which letter of credit shall be issued by a money-center bank (a bank which accepts deposits, maintains accounts, has a local Silicon Valley or San Francisco, California office which will negotiate a letter of credit and whose deposits are insured by the FDIC) reasonably acceptable to Sublessor, Sublessor shall be for a term continuing through the last day of the forty-five thirty (45) - 30)- day period following the Expiration Date (or shall contain an “"evergreen” " provision which provides that it automatically is renewed on an annual basis unless the issuer delivers forty-five (45) business days’ ' prior written notice to Sublessor and Sublessee), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer of the letter of credit and a written statement signed by Sublessor or its authorized agent stating that Sublessor is entitled to draw down on the letter of credit, shall be freely transferable only to a transferee of Sublessor's interest in the Master Lease and this Sublease in conformity with the provisions in the Master Lease regarding transferability of Sublessor's security deposit held by Master Lessor, and shall be in a form and content reasonably acceptable to Sublessor. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee hereunder shall be referred to collectively herein as the “"LC”". The LC shall be held by Sublessor without liability for interest. The LC is not an advance payment of Rent or a measure or limit of Sublessor's damages upon Sublessee's default under this Sublease. The LC shall provide for forty-five (45) business days’ ' prior written notice to Sublessor of cancellation or material change thereof, and shall further provide that, in the event of any non-extension of the LCLC (if the term of the LC is for a period shorter than the Term of this Sublease) at least forty-five (45) business days prior to its expiration, the entire face amount shall automatically be paid to Sublessor, and Sublessor shall hold the funds so obtained for application to any current or future obligations of Sublessee. If for any reason such automatic payment does not occur in the event of a non-extension at least forty-five (45) days prior to expiration, Sublessor shall be entitled to present its written demand for payment of the entire face amount of the LC, and the proceeds therefrom funds so obtained shall be held as provided belowabove. Sublessee shall pay all expenses, points and/or fees incurred by Sublessee in obtaining the LC. Additionally, upon a proposed sale or other transfer of any interest in the Subleased Premises, this Sublease or Sublessor (including consolidations, mergers or other entity changes), Sublessee, at its Sublessor's sole cost and expense and upon ten (10) business days’ ' notice, shall, concurrent with Sublessor’s 's delivery to Sublessee of the then outstanding LC, deliver to any such transferee, successor or assign a replacement LC on identical terms (except for the stated beneficiary) from the same issuer or another bank acceptable to Sublessor, in Sublessor’s reasonable discretion, naming the new sublessor as the beneficiary thereof. The LC shall not be mortgaged, assigned or encumbered in any manner whatsoever by Sublessee without Sublessor’s prior written consent, which may be withheld in Sublessor’s sole discretion.same

Terms of Letter of Credit. In lieu of the cash Security Deposit required by Paragraph 5 above, as additional consideration for value received and a further incentive to maintain Sublessor’s willingness to enter this Sublease, and as additional collateral so as to compensate Sublessor for future damages it may suffer by reason of Sublessee’s defaults hereunder, Sublessee shall deliver to Sublessor, not Not later than five (5) days after Reliant’s receipt of the date written consent of Sublessee’s execution of Prime Landlord and Master Sublandlord to this Sub-Sublease, the Testing lab Use and the Initial Improvements, Reliant shall deliver to Mercury an unconditional, clean, irrevocable letter of credit in the amount of One hundred Seventy-Six Thousand Eight Hundred Eighty-Two and 94/100 dollars ($268,864.25 176,882.94) (“LC Amount”), which letter of credit shall be issued by a money-center bank (a bank which accepts deposits, maintains accounts, has a local Silicon Valley San Jose, California or San Francisco, California office which will negotiate a letter of credit and whose deposits are insured by the FDIC) reasonably acceptable to SublessorMercury, shall be for a term continuing through the last day of the forty-five thirty (45) - 30 day period following the Expiration Date (or shall contain an “evergreen” provision which provides that it automatically is renewed through the date that is thirty (30) days after the Expiration Date on an annual basis unless the issuer delivers at least forty-five (45) days’ prior written notice to Sublessor Mercury and SublesseeReliant), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer of the letter of credit and a written statement signed by Sublessor Mercury or its authorized agent stating that Sublessor Mercury is entitled to draw down on the letter of credit, shall be freely transferable and shall be in a form and content reasonably acceptable to SublessorMercury. The LOC shall provide that it is freely transferable by Sublandlord, without charge and without recourse, to the assignee or transferee of Sublandlord’s interest in the Subleased Premises, and that the issuer will confirm the same to Mercury and such assignee or transferee upon request. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee Reliant hereunder shall be referred to collectively herein as the “LC”. The LC shall be held by Mercury without liability for interest and as security for the performance by Reliant of its obligations under this Sub-Sublease. The LC is not an advance payment of Rent or a measure of limit of mercury’s damages upon Reliant’s default under this Sub-Sublease. The LC shall provide for at least forty-five (45) days’ prior written notice to Sublessor Mercury of cancellation or material change thereof, and shall further provide that, in the event of any non-extension of the LCLC (if the term of the LC is for a period shorter than the Term of this Sub-Sublease) at least forty-five (45) days prior to its expiration, Sublessor Mercury shall be entitled to present its written demand for payment of the entire face amount of the LC, and the proceeds therefrom funds so obtained shall be held as provided below. Sublessee Reliant shall pay all expenses, points and/or fees incurred by Sublessee in obtaining or drawing down upon the LC. .’ Additionally, upon a proposed sale or other transfer of any interest in the Subleased Premises, this Sub-Sublease or Sublessor Mercury (including consolidations, mergers or other entity changes), Sublessee, at its Reliant’s sole cost and expense and upon ten (10) business days’ notice, shall, concurrent with SublessorMercury’s delivery to Sublessee Reliant of the then outstanding LC, deliver to any such transferee, successor or assign a replacement LC on identical terms (except for the stated beneficiary) from the same issuer or another bank issuer reasonably acceptable to Sublessor, in Sublessor’s reasonable discretionMercury, naming the new sublessor sub-sublandlord as the beneficiary thereof. The LC shall not be mortgaged, assigned or encumbered in any manner whatsoever by Sublessee Reliant without SublessorMercury’s prior written consent, which may be withheld in SublessorMercury’s sole discretion.

Terms of Letter of Credit. In lieu The Letter of Credit shall commence upon the cash Security Deposit required by Paragraph 5 above, as additional consideration for value received and a further incentive to maintain Sublessor’s willingness to enter this Sublease, and as additional collateral so as to compensate Sublessor for future damages it may suffer by reason of Sublessee’s defaults hereunder, Sublessee shall deliver to Sublessor, not later than five (5) days after the ------------------------- date of Sublessee’s execution of this SubleaseLease and Tenant shall renew the Letter of Credit from time to time through the Lease Term, at least thirty (30) days prior to the expiration thereof and deliver to Landlord a new Letter of Credit or an endorsement to the Letter of Credit and any other evidence required by Landlord that the Letter of Credit has been renewed. The Letter of Credit shall be (i) issued by a bank reasonably approved by Landlord ("Bank") and "callable" by Landlord through a branch office of the Bank located in San Mateo, California, and (ii) in a form containing the required provisions set forth in Section 21.2.1 below and consistent with the provisions set forth in Sections 21.2.2 through 21.2.4 below. The premium or purchase price of, or any other Bank fees associated with, such Letter of Credit shall be paid by Tenant. The following provisions shall apply to the Letter of Credit: 21.2.1 Such Letter of Credit shall be transferable, irrevocable and unconditional, cleanso that Landlord, irrevocable or its successor(s) in interest, may at any time "call" for any portion of the then uncalled upon amount thereof without regard to and without the Bank inquiring as to the right or lack of right of the holder of said letter of credit to effect such calls or the existence or lack of existence of any defenses by Tenant with respect thereto; 21.2.2 Landlord agrees not to draw upon the Letter of Credit unless Landlord claims default by Tenant under the Lease after giving notice thereof to Tenant in accordance with the terms of this Lease and the expiration of any applicable cure period set forth in this Lease, but if Landlord does effect such a "draw," such "draw" amount may, at Landlord's option, be in the full amount of $268,864.25 (“LC Amount”)the Letter of Credit or a partial draw as necessary to compensate Landlord for such default. 21.2.3 Any failure or delay of Landlord to "draw" any portion of the Letter of Credit shall not act as a waiver of Landlord's right to do so at any time thereafter or constitute a waiver of any default with respect to the Lease. 21.2.4 Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, which letter either prior to or following a "draw" by Landlord of credit 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 issued by a money-center bank (a bank which accepts deposits, maintains accounts, has a local Silicon Valley office which will negotiate a letter deemed to render the Letter of credit and whose deposits are insured by Credit conditional upon this Lease or to justify the FDIC) reasonably acceptable to Sublessor, shall be for a term continuing through the last day of the forty-five (45) - day period following the Expiration Date (or shall contain an “evergreen” provision which provides that it automatically is renewed on an annual basis unless the issuer delivers forty-five (45) days’ prior written notice to Sublessor and Sublessee), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer of the letter Letter of credit and Credit in failing to honor a written statement signed draw upon such Letter of Credit in a timely manner. In the event Landlord is determined through any dispute resolution procedure agreed upon by Sublessor the parties or its authorized agent stating that Sublessor is entitled by a court of competent jurisdiction to draw down have improperly drawn on the letter Letter of creditCredit, shall be freely transferable and shall be in a form and content reasonably acceptable to Sublessor. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee hereunder shall be referred to collectively herein as the “LC”. The LC shall provide for forty-five (45) days’ prior written notice to Sublessor of cancellation or material change thereof, and shall further provide that, in the event of any non-extension of the LC, Sublessor then Tenant shall be entitled to present its written demand for payment receive a prompt refund of the entire face such amount of the LC, and the proceeds therefrom so obtained shall be held as provided below. Sublessee shall pay all expenses, points and/or fees incurred by Sublessee in obtaining the LC. Additionally, upon a proposed sale or other transfer of any interest in the Premises, this Sublease or 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 Sublessee of the then outstanding LC, deliver to any such transferee, successor or assign a replacement LC on identical terms (except for the stated beneficiary) from the same issuer or another bank acceptable to Sublessor, in Sublessor’s reasonable discretion, naming the new sublessor as the beneficiary thereof. The LC shall not be mortgaged, assigned or encumbered in any manner whatsoever by Sublessee without Sublessor’s prior written consent, which may be withheld in Sublessor’s sole discretionLandlord.

Terms of Letter of Credit. In lieu The Letter of the cash Security Deposit required by Paragraph 5 above, as additional consideration for value received and a further incentive to maintain Sublessor’s willingness to enter this Sublease, and as additional collateral so as to compensate Sublessor for future damages it may suffer by reason Credit shall commence within fifteen (15) business days of Sublessee’s defaults hereunder, Sublessee shall deliver to Sublessor, not later than five (5) days after the date of Sublessee’s execution of this SubleaseLease and Tenant shall renew the Letter of Credit from time to time through the Lease Term, at least thirty (30) days prior to the expiration thereof and deliver to Landlord a new Letter of Credit or an unconditionalendorsement to the Letter of Credit and any other evidence required by Landlord that the Letter of Credit has been renewed. If Tenant has not provided to Landlord evidence of such renewal thirty (30) days prior to the expiration thereof, cleanthen Landlord shall have the right to draw on the Letter of Credit pursuant to this Section 21 and hold such amount as a security deposit, irrevocable letter pursuant to Section 22 below. The Letter of credit in the amount of $268,864.25 (“LC Amount”), which letter of credit Credit shall be (i) issued by a money-center bank reasonably approved by Landlord ("Bank") and "callable" by Landlord through a bank which accepts depositsbranch office of the Bank located in San Francisco, maintains accountsCalifornia, has and (ii) in a local Silicon Valley office which will negotiate a letter form containing the required provisions set forth in Sections 21.2.1 through 21.2.4 below. The premium or purchase price of, or any other Bank fees associated with, such Letter of credit and whose deposits are insured by the FDIC) reasonably acceptable to Sublessor, Credit shall be paid by Tenant. The Letter of Credit shall, without limiting the foregoing, provide that: 21.2.1 Such Letter of Credit shall expressly permit partial draws and shall be transferable, irrevocable and unconditional, so that Landlord, or its successor(s) in interest, may at any time "call" for a term continuing through the last day any portion of the forty-five then uncalled upon amount thereof without regard to and without the Bank inquiring as to the right or lack of right of the holder of the Letter of Credit to effect such calls or the existence or lack of existence of any defenses by Tenant with respect thereto; 21.2.2 Landlord agrees not to draw upon the Letter of Credit unless Landlord claims default by Tenant under the Lease after giving notice thereof to Tenant in accordance with the terms of this Lease and the expiration of any applicable cure period set forth in this Lease, and if Landlord does effect such a "draw," such "draw" amount shall be such amount (45partial or full) - day period as necessary to compensate Landlord for such default. 21.2.3 Any failure or delay of Landlord to "draw" any portion of the Letter of Credit shall not act as a waiver of Landlord's right to do so at any time thereafter or constitute a waiver of any default with respect to the Lease. 21.2.4 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 Expiration Date (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 contain an “evergreen” provision which provides that it automatically is renewed on an annual basis unless be deemed to render the issuer delivers forty-five (45) days’ prior written notice Letter of Credit conditional upon this Lease or to Sublessor and Sublessee), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by justify the issuer of the letter Letter of credit and Credit in failing to honor a written statement signed draw upon such Letter of Credit in a timely manner. In the event Landlord is determined through any dispute resolution procedure agreed upon by Sublessor the parties or its authorized agent stating that Sublessor is entitled by a court of competent jurisdiction to draw down have improperly drawn on the letter Letter of creditCredit, shall be freely transferable and shall be in a form and content reasonably acceptable to Sublessor. Such letter of credit, together with any other renewal or replacement letters of credit delivered or to be delivered by Sublessee hereunder shall be referred to collectively herein as the “LC”. The LC shall provide for forty-five (45) days’ prior written notice to Sublessor of cancellation or material change thereof, and shall further provide that, in the event of any non-extension of the LC, Sublessor then Tenant shall be entitled to present its written demand for receive a prompt refund of such amount from Landlord. Tenant hereby waives the provisions of Section 1950.7 of the California Civil Code, and all other provisions of law, now or hereafter in force, which provide that Landlord may claim from a security deposit (including the Letter of Credit) only those sums reasonably necessary to remedy defaults in the payment of the entire face amount of the LCrent, and the proceeds therefrom so obtained shall be held as provided below. Sublessee shall pay all expenses, points and/or fees incurred to repair damage caused by Sublessee in obtaining the LC. Additionally, upon a proposed sale Tenant or other transfer of any interest in to clean the Premises, this Sublease or 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 Sublessee of the then outstanding LC, deliver to any such transferee, successor or assign a replacement LC on identical terms (except for the stated beneficiary) from the same issuer or another bank acceptable to Sublessorit being agreed that Landlord may, in Sublessor’s reasonable discretionaddition, naming claim those sums reasonably necessary to compensate Landlord for any other loss or damage, foreseeable or unforeseeable, caused by the new sublessor as the beneficiary thereof. The LC shall not be mortgagedact or omission of Tenant or any officer, assigned employee, agent or encumbered in any manner whatsoever by Sublessee without Sublessor’s prior written consent, which may be withheld in Sublessor’s sole discretioninvitee of Tenant.