STANDARD INDUSTRIAL/COMMERCIAL MULTI TENANT LEASE GROSS AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION RECORDING OF THIS LEASE PROHIBITED

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EXHIBIT 10.1

STANDARD INDUSTRIAL/COMMERCIAL MULTI TENANT LEASE GROSS

AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION

RECORDING OF THIS LEASE PROHIBITED

1. Basic Provisions ("Basic Provisions").

1.1 Parties: This Lease ("Lease"), dated for reference purposes only,

SEPTEMBER 23, 2005 is made by and between FULLERTON BUSINESS CENTER ("Lessor")

and ALLIED MED, INC., AN OREGON CORPORATION (collectively the "Parties," or

individually a "Party").

1.2(a) Premises: That certain portion of the Building, including all

Improvements therein or to be provided by Lessor under the terms of this Lease,

commonly known by the street address of 2500 E. FENDER AVENUE, UNIT "K" located

In the City of FULLERTON County of ORANGE, State of CALIFORNIA, with zip code

92831, as outlined on Exhibit B attached hereto ("Premises"). The "Building" is

that certain building containing the Premises and generally described as

(describe briefly the nature of the Building): APPROXIMATELY 3,520 SQUARE FEET

OF RENTABLE SPACE INCLUDING OVERHANG AS OUTLINED IN EXHIBITS "A" AND "B"

ATTACHED HERETO AND INCORPORATED HEREIN. In addition to Lessee's rights to use

and occupy the Premises as hereinafter specified, Lessee shall have

non-exclusive rights to the Common Areas (as defined In Paragraph 2.7 below) as

hereinafter specified, but shall not have any rights to the roof, exterior walls

or utility raceways of the Building or to any other buildings In the Industrial

Center. The Premises, the Building, the Common Areas, the land upon which they

are located, along with all other buildings and Improvements thereon, are herein

collectively referred to as the "Industrial Center." (Also see Paragraph 2.)

1.2(b) Parking: FIVE (5) unreserved vehicle parking spaces ("Unreserved

Parking Spaces"); and N/A reserved vehicle parking spaces ("Reserved Parking

Spaces"). (Also see Paragraph 2.6.)

1.3 Term: ONE (1) years and 0months ("Original Term") commencing

OCTOBER 1, 2005 ("Commencement Date") and ending SEPTEMBER 30, 2006 ("Expiration

Date"). (Also see Paragraph 3.)

1.4 Early Possession: N/A ("Early Possession Date"). (Also see

Paragraphs 3.2 and 3.3.)

1.5 Base Rent: $2,534.00 per month ("Base Rent"), payable on the FIRST

day of each month commencing OCTOBER 1, 2005. (Also see Paragraph 4.) [ ] If

this box is checked, this Lease provides for the Base Rent to be adjusted per

Addendum , attached hereto.

1.6(a) Base Rent Paid Upon Execution: $2,534.00 (as Base Rent for the

period OCTOBER 1, 2005 - OCTOBER 31, 2005.

1.6(b) Lessee's Share of Common Area Operating Expenses: 0.015303

percent (_____%) ("Lessee's Share") as determined by

[X] prorate square footage of the Premises as compared to the total

square footage of the Building or [ ] other criteria as described in Addendum

__.

1.7 Security Deposit: $7,602.00 ("Security Deposit"). (Also see

Paragraph 5.)

1.8 Permitted Use: OFFICE/WAREHOUSE USED FOR PHARMACEUTICAL

MANUFACTURING & DISTRIBUTION ("Permitted Use") (Also see Paragraph 6.)

1.9 Insuring Party. Lessor Is the "Insuring Party." (Also see Paragraph

8.)

1.10(a) Real Estate Brokers. The following real estate broker(s)

(collectively, the "Brokers") and brokerage relationships exist in this

transaction and are consented to by the Parties (check applicable boxes):

[ ] N/A represents Lessor exclusively ("Lessor's Broker");

[ ] N/A represents Lessee exclusively ("Lessee's Broker"); or

[ ] N/A represents both Lessor and Lessee ("Dual Agency"). (Also see

Paragraph 15.)

1.10(b) Payment to Brokers. Upon the execution of this Lease by both

Parties, Lessor shall pay to said Broker(s) jointly, or In such separate shares

as they may mutually designate In writing, a fee as set forth In a separate

written agreement between Lessor and said Broker(s) (or In the event there is no

separate written agreement between Lessor and said Broker(s), the sum of ($-0)

for brokerage services rendered by said Broker(s) in connection with this

transaction.

1.11 Guarantor. The obligations of the Lessee under this Lease are to

be guaranteed by N/A ("Guarantor"). (Also see Paragraph 37.)

1.12 Addenda and Exhibits. Attached hereto is an Addendum or Addenda

consisting of Paragraphs 1 through 37, and Exhibits A through C, all of which

constitute a part of this Lease.

2. Premises, Parking and Common Areas.

2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases

from Lessor, the Premises, for the term, at the rental, and upon all of the

terms, covenants and conditions set forth in this Lease. Unless otherwise

provided herein, any statement of square footage set forth In this Lease, or

that may have been used in calculating rental and/or Common Area Operating

Expenses, Is an approximation which Lessor and Lessee agree Is reasonable and

the rental and Lessee's Share (as defined in Paragraph 1.6(b)) based thereon is

not subject to revision whether or not the actual square footage Is more or

less.

2.2 Condition. Lessor shall deliver the Premises to Lessee clean and

free of debris on the Commencement Date and warrants to Lessee that the existing

plumbing, electrical systems, fire sprinkler system, lighting, air conditioning

and heating systems and loading doors, If any, In the Premises, other than those

constructed by Lessee, shall be In good operating condition on the Commencement

Date. If a non-compliance with said warranty exists as of the Commencement Data,

Lessor shall, except as otherwise provided In this Lease, promptly after receipt

of written notice from Lessee setting forth with specificity the nature and

extent of such non-compliance, rectify same at Lessor's expense. If Lessee does

not give Lessor written notice of a non-compliance with this warranty within

thirty (30) days after the Commencement Date, correction of that non-compliance

shall be the obligation of Lessee at Lessee's sole cost and expense.

2.3 Compliance with Covenants, Restrictions and Building Code. Lessor

warrants that any Improvements (other than those constructed by Lessee or at

Lessee's direction) on or in the Premises which have been constructed or

Installed by Lessor or with Lessor's consent or at Lessor's direction shall

comply with all applicable covenants or restrictions of record and applicable

building codes, regulations and ordinances In effect on the Commencement Date.

Lessor further warrants to Lessee that Lessor has no knowledge of any claim

having been made by any governmental agency that a violation or violations of

applicable building codes, regulations, or ordinances exist with regard to the

Premises as of the Commencement Xxxx. Said warranties shall not apply to any

Alterations or Utility Installations (defined Initials: (C) American Industrial

Real Estate Association 1993 MULTI-TENANT-- GROSS in Paragraph 7.3(a)) made or

to be made by Lessee. If the Premises do not comply with bald warranties, Lessor

shall, except as otherwise provided in this Lease, promptly after receipt of

written notice from Lessee given within six (6) months following the

Commencement Xxxx and setting forth with specificity the nature and extent of

such non-compliance, take such action, at Lessor's expense, as may be reasonable

or appropriate to rectify the non-compliance. Lessor makes no warranty that the

Permitted Use in Paragraph 1.8 is permitted for the Premises under Applicable

Laws (as defined in Paragraph 2.4).

2.4 Acceptance of Premises. Lessee hereby acknowledges: (a) that It has

been advised by the Broker(s) to satisfy Itself with respect to the condition of

the Premises (including but not limited to the electrical and fire sprinkler

systems, security, environmental aspects, seismic and earthquake requirements,

and compliance with the Americans with Disabilities Act and applicable zoning,

municipal, county, state and federal laws, ordinances and regulations and any

covenants or restrictions of record (collectively, "Applicable Laws") and the

present and future suitability of the Premises for Lessee's Intended use; (b)

that Lessee has. made such investigation as it deems necessary with reference to

such matters, is satisfied with reference thereto, and assumes all

responsibility therefore as the same relate to Lessee's occupancy of the

Premises and/or the terms of this Lease; and (c) that neither Lessor, nor any of

Lessor's agents, has made any oral or written representations or warranties with

respect to said matters other than as set forth In this Lease.

2.5 Lessee as Prior Owner/Occupant. The warranties made by Lessor In

this Paragraph 2 shall be of no force or effect if immediately prior to the date

set forth In Paragraph 1.1 Lessee was the owner or occupant of the Premises. In

such event, Lessee shall, at Lessee's sole cost and expense, correct any

non-compliance of the Premises with said warranties.

2.6 Vehicle Parking. Lessee shall be entitled to use the number of

Unreserved Parking Spaces and Reserved Parking Spaces specified in Paragraph

1.2(b) on those portions of the Common Areas designated from time to time by

Lessor for parking. Lessee shall not use more parking spaces than said number.

Said parking spaces shall be used for parking by vehicles no larger than

lull-size passenger automobiles or pick-up trucks, herein called "Permitted Size

Vehicles." Vehicles other than Permitted Size Vehicles shall be parked and

loaded or unloaded as directed by Lessor in the Rules and Regulations (as

defined In Paragraph 40) issued by Lessor. (Also see Paragraph 2.9.)

(a) Lessee shall not permit or allow any vehicles that belong to or are

controlled by Lessee or Lessee's employees, suppliers, shippers, customers,

contractors or Invitees to be loaded, unloaded, or parked In areas other than

those designated by Lessor for such activities.

(b) If Lessee permits or allows any of the prohibited activities

described in this Paragraph 2.6, then Lessor shall have the right, without

notice, In addition to such other rights and remedies that timey have, to remove

or low away the vehicle Involved and charge the cost to Lessee, which cost shall

be immediately payable upon demand by Lessor.

parking facilities required by Applicable Law.

2.7 Common Areas--Definition. The term "Common Areas" is defined as all

areas and facilities outside the Premises and within the exterior boundary line

of the Industrial Center and Interior utility raceways within the Premises that

are provided and designated by the Lessor from time to time for the general

nonexclusive use of Lessor, Lessee and other lessees of the Industrial Center

and their respective employees, suppliers, shippers, customers, contractors and

Invitees, including parking areas, loading and unloading areas, trash areas,

roadways, sidewalks, walways, parkways, driveways and landscaped areas.

2.8 Common Areas--Lessee's Rights. Lessor hereby grants to Lessee, for

the benefit of Lessee and Its employees, suppliers, shippers, contractors,

customers and Invitees, during the term of this Lease, the non-exclusive right

to use, In common with others entitled to such use, the Common Areas as they

exist from time to time, subject to any rights, powers, and privileges reserved

by Lessor under the terms hereof or under the terms of any rules and regulations

or restrictions governing the use of the Industrial Center. Under no

circumstances shall the right herein granted to use the Common Areas be deemed

to include the right to store any properly, temporarily or permanently, In the

Common Areas. Any such storage shall be permitted only by the prior written

consent of Lessor or Lessor's designated agent, which consent may be revoked at

any time. In the even) that any unauthorized storage shall occur than Lessor

shall have the right, without notice, In addition to such other rights and

remedies that It may have, to remove the properly and charge the cost to Lessee,

which cost shall be Immediately payable upon demand by Lessor.

2.9 Common Areas--Rules and Regulations. Lessor or such other person(s)

as Lessor may appoint shall have the exclusive control and management of the

Common Areas and shall have the right, from time to time, to establish, modify,

amend and enforce reasonable Rules and Regulations with respect thereto In

accordance with Paragraph 40. Lessee agrees to abide by and conform to all such

Rules and Regulations, and to cause its employees, suppliers, shippers,

customers, contractors and Invitees to so abide and conform. Lessor shall not be

responsible to Lessee for the non-compliance with said rules and regulations by

other lessees of the Industrial Center.

2.10 Common Areas--Changes. Lessor shall have the right, In Lessor's

sole discretion, from time to time:

(a) To make changes to the Common Areas, Including, without limitation,

changes in the location, size, shape and number of driveways, entrances, parking

spaces, parking areas, loading and unloading areas, Ingress, egress, direction

of traffic, landscaped areas, walkways and utility raceways;

(b) To close temporarily any of the Common Areas for maintenance

purposes so long as reasonable access to the Premises remains available;

Center to be a part of the Common Areas;

(d) To add additional buildings and improvements to the Common Areas;

(e) To use the Common Areas while engaged In making additional

Improvements, repairs or alterations to the industrial Center, or any portion

thereof;

(f) To do and perform such other acts and make such other changes in,

to or with respect to the Common Areas and Industrial Center as Lessor may, in

the exercise of sound business judgment, deem to be appropriate.

3. Term.

3.1 Term. The Commencement Date, Expiration Data and Original Term of

this Lease are as specified in Paragraph 1.3.

3.2 Early Possession. If an Early Possession Date Is specified In

Paragraph 1.4 and If Lessee totally or partially occupies the Premises after the

Early Possession Date but prior to the Commencement Date, the obligation to pay

Base Rent shall be abated for the period of such early occupancy. All other

terms of this Lease, however, (including but not limited to the obligations to

pay Lessee's Share ol Common Area Operating Expenses and to carry the Insurance

required by Paragraph 8) shall be In effect during such period. Any such early

possession shall not affect nor advance the Expiration Date of the Original

Term.

3.3 Delay in Possession. If for any reason Lessor cannot deliver

possession of the Premises to Lessee by the Early Possession Xxxx, If one Is

specified in Paragraph 1.4, or if no Early Possession Xxxx Is specified, by the

Commencement Data, Lessor shall not be subject to any liability therefor, nor

shall such failure affect the validity of this Lease, or the obligations of

Lessee hereunder, or extend the term hereof, but In such case, Lessee shall not,

except as otherwise provided herein, be obligated to pay rent or perform any

other obligation of Lessee under the terms of this Lease until Lessor delivers

possession of the Premises to Lessee. II possession of the Premises Is not

delivered to Lessee within sixty (60) days after the Commencement Xxxx, Lessee

may, at its option, by notice in writing to Lessor within ten (10) days after

the and of said sixty (60) day period, cancel this Lease, In which event the

parties shall be discharged from all obligations hereunder; provided further,

however, that If such written notice of Lessee Is not received by Lessor within

said ten (10) day period, Lessee's right to cancel this Lease hereunder shall

terminate and be of no further force or effect. except as may be otherwise

provided, and regardless of when the Original Term actually commences, If

possession is not tendered to Lessee when required by this Lease and Lessee does

not terminate this Lease, as aforesaid, the period free of the obligation to pay

Base Rent, II any, that Lessee would otherwise have enjoyed shall run from the

date of delivery of possession and continue for a period equal to the period

during which the Lessee would have otherwise enjoyed under the terms hereof, but

minus any days of delay caused by the acts, changes or omissions of Lessee.

4. Rent.

4.1. Base Rent. Lessee shall pay Base Rent and other rent or charges,

as the same may be adjusted from time to time, to Lessor in lawful money of the

United States, without offset or deduction, on or before the day on which It Is

due under the terms of this Lease. Base Rent and all other rent and charges for

any period during the term hereof which is for less than one full month shall be

prorated based upon the actual number of days of the month involved. Payment of

Base Rent and other charges shall be made to Lessor at its address staled herein

or to such other persons or at such other addresses as Lessor may from time to

time designate in writing to Lessee.

4.2 Common Area Operating Expenses. Lessee shall pay to Lessor during

the term hereof, In addition to the Base Rent, Lessee's Share (as specified in

Paragraph 1.6(b)) of all Common Area Operating Expenses, as hereinafter defined,

during each calendar year of the term of this Lease, In accordance with the

following provisions:

(a) "Common Area Operating Expenses" are defined, for purposes of this

Lease, as all costs Incurred by Lessor relating to the ownership and operation

of the industrial Center, Including, but not limited lo, the following:

(i) The operation, repair and maintenance, In neat, clean, good

order and condition, of the following:

(aa) The Common Areas, Including parking areas, loading

and unloading areas, trash areas, roadways,

sidewalks, walkways, parkways, driveways, landscaped

areas, striping, bumpers, Irrigation systems, Common

Area lighting facilities, fences and xxxxx, elevators

and roof.

(bb) Exterior signs and any tenant directories.

(cc) Fire detection and sprinkler systems.

(ii) The cost of water, gas, electricity and telephone to

service the Common Areas.

(iii) Trash disposal, property management and security services

and the costs of any environmental inspections.

(iv) Reserves set aside for maintenance and repair of Common

Areas.

(v) Any Increase above the Base Real Property Taxes (as defined

In Paragraph 10.2(b)) for the Building and the Common

Areas.

(vi) Any "Insurance Cost Increase" (as defined In Paragraph

8.1).

(vii) The cost of Insurance carried by Lessor with respect to the

Common Areas.

(viii) Any deductible portion of an Insured loss concerning the

Building or the Common Areas.

(ix) Any other services to be provided by Lessor that are slated

elsewhere In this Lease to be a Common Area Operating

Expense.

(b) Any Common Area Operating Expenses and Real Properly Taxes that are

specifically attributable to the Building or to any other building in the

Industrial Center or to the operation, repair and maintenance thereof, shall be

allocated entirely to the Building or to such other building. However, any

Common Area Operating Expenses and Real Property Taxes that are not specifically

attributable to the Building or to any other building or to the operation repair

and maintenance thereof, shall be equitably allocated by Lessor to all buildings

in the industrial Center.

forth In Subparagraph 4.2(e) shall not be deemed to impose an obligation upon

Lessor to either have said Improvements or facilities or to provide those

services unless the Industrial Center already has the same, Lessor already

provides the services, or Lessor has agreed elsewhere In this Lease to provide

the same or some of them.

(d) Lessee's Share of Common Area Operating Expenses shall be payable

by Lessee within ten (10) days after a reasonably detailed statement of actual

expenses Is presented to Lessee by Lessor. At Lessor's option, however, an

amount may be estimated by Lessor from time to time of Lessee's Share of annual

Common Area Operating Expenses and the same shall be payable monthly or

quarterly, as Lessor shall designate, during each 12-month period of the Lease

term, on the same day as the Base Rent is due hereunder. Lessor shall deliver to

Lessee within sixty (60) days after the expiration of each calendar year a

reasonably detailed statement showing Lessee's Share of the actual Common Area

Operating Expenses Incurred during the preceding year. If Lessee's payments

under this Paragraph 4.2(d) during said preceding year exceed Lessee's Share as

indicated on said statement. Lessor shall be credited the amount of such over

payment against Lessee's Share of Common Area Operating Expenses next becoming

due. If Lessee's payments under this Paragraph 4.2(d) during said preceding year

were less than Lessee's Share as Indicated on said statement, Lessee shall pay

to Lessor the amount of the deficiency within ten (10) days after delivery by

Lessor to Lessee of said statement.

5. Security Deposit. Lessee shall deposit with Lessor upon Lessee's execution

hereof the Security Deposit set forth In Paragraph 1.7 as security for Lessee's

faithful performance of Lessee's obligations under This Lease. II Lessee falls

to pay Base Rent or other rent or charges due hereunder, or otherwise Defaults

under this Lease (as defined in Paragraph 13.1), Lessor may use, apply or retain

all or any portion of said Security Deposit for the payment of any amount due

Lessor or to reimburse or compensate Lessor for any liability, cost, expense,

loss or damage (Including attorneys' fees) which Lessor may suffer or Incur by

reason thereof. If Lessor uses or applies all or any portion of said Security

Deposit, Lessee shall within ten (10) days after written request therefore

deposit monies with Lessor sufficient to restore said Security Deposit to the

lull amount required by this Lease. Any time the Base Rent Increases during the

term of this Lease, Lessee shall, upon written request from Lessor, deposit

additional monies with Lessor as an addition to the Security Deposit so that the

total amount of the Security Deposit shall at all times bear the same proportion

to the then current Base Rent as the Initial Security Deposit bears to the

Initial Base Rent set forth In Paragraph 1.5. Lessor shall not be required to

keep all or any part of the Security Deposit separate from Its general accounts.

Lessor shall, at the expiration or earlier termination of the term hereof and

alter Lessee has vacated the Premises, return to Lessee (or, at Lessor's option,

to the last assignee, if any, of Lessee's Interest herein), that portion of the

Security Deposit not used or applied by Lessor. Unless otherwise expressly

agreed in writing by Lessor, no part of the Security Deposit shall be considered

to be held in trust, to bear Interest or other Increment for Its use, or to be

prepayment for any monies to be paid by Lessee under this Lease.

6. Use.

6.1 Permitted Use.

(a) Lessee shall use and occupy the Premises only for the

Permitted Use set forth In Paragraph 1.8, or any other legal use which Is

reasonably comparable thereto, and for no other purpose. Lessee shall not use or

permit the use of the Premises In a manner that is unlawful, creates waste or a

nuisance, or that disturbs owners and/or occupants of, or causes damage to the

Premises or neighboring premises or properties.

(b) Lessor hereby agrees to not unreasonably withhold or delay Its

consent to any written request by Lessee, Lessee's assignees or subtenants, and

by prospective assignees and subtenants of Lessee, Its assignees and subtenants,

for a modification of said Permitted Use, so long as the same will not Impair

the structural integrity of the Improvements on the Premises or In the Building

or the mechanical or electrical systems therein, does not conflict with uses by

other lessees, is not significantly more burdensome to the Premises or the

Building and the Improvements thereon, and is otherwise permissible pursuant to

this Paragraph 6. If Lessor elects to withhold such consent, Lessor shall within

five (5) business days after such request give a written notification of same,

which notice shall include an explanation of Lessor's reasonable objections to

the change in use.

6.2 Hazardous Substances.

(a) Reportable Uses Require Consent. The term "Hazardous

Substance" as used In this Lease shall mean any product, substance, chemical,

material or waste whose presence, nature, quantity and/or intensity of

existence, use, manufacture, disposal, transportation, spill, release or effect,

either by Itself or in combination with other materials expected to be on the

Premises, Is either: (i) potentially Injurious to the public health, safety or

welfare, the environment, or the Premises; (ii) regulated or monitored by any

governmental authority; or (iii) a basis for potential liability of Lessor to

any governmental agency or third party under any applicable statute or common

law theory. Hazardous Substance shall Include, but not be limited to,

hydrocarbons, petroleum, gasoline, crude oil or any products or by-products

thereof. Lessee shall not engage In any activity in or about the Premises which

constitutes a Reportable Use (as hereinafter defined) of Hazardous Substances

without the express prior written consent of Lessor and compliance In a timely

manner (at Lessee's sole cost and expense) with all Applicable Requirements (as

defined In Paragraph 6.3). "Reportable Use" shell mean (i) the Installation or

use of any above or below ground storage tank, (ii) the generation, possession,

storage, use, transportation, or disposal of a Hazardous Substance that requires

a permit from, or with respect to which a report, notice, registration or

business plan Is required to be filed with, any governmental authority, and

(iii) the presence In, on or about the Premises of a Hazardous Substance with

respect to which any Applicable Laws require that a notice be given to persons

entering or occupying the Premises or neighboring properties. Notwithstanding

the foregoing, Lessee may, without Lessor's prior consent, but upon notice to

Lessor and In compliance with all Applicable Requirements, use any ordinary and

customary materials reasonably required to be used by Lessee in the normal

course of the Permitted Use, so long as such use Is not a Reportable Use and

does not expose the Premises or neighboring properties to any meaningful risk of

contamination or damage or expose Lessor to any liability therefor. In addition,

Lessor may (but without any obligation to do so) condition Its consent to any

Reportable Use of any Hazardous Substance by Lessee upon Lessee's giving Lessor

such additional assurances as Lessor, In Its reasonable discretion, deems

necessary to protect Itself, the public, the Premises and the environment

against damage, contamination or Injury and/or liability therefor, Including but

not limited to the Installation (and, at Lessor's option, removal on or before

Lease expiration or earlier termination) of reasonably necessary protective

modifications to the Premises (such as concrete encasements) and/or the deposit

of an additional Security Deposit under Paragraph 5 hereof.

(b) Duty to Inform Lessor. If Lessee knows, or has reasonable

cause to believe, that a Hazardous Substance has come to be located In, on,

under or about the Premises or the Building, other than as previously consented

to by Lessor, Lessee shall Immediately give Lessor written notice thereof,

together with a copy of any statement, report, notice, registration,

application, permit, business plan, license, claim, action, or proceeding given

to, or received from, any governmental authority or private party concerning the

presence, spill, release, discharge of, or exposure to, such Hazardous Substance

including but not limited to all such documents as may be involved In any

Reportable Use Involving the Premises. Lessee shall not cause or permit any

Hazardous Substance to be spilled or released in, on, under or about the

Premises (Including, without limitation, through the plumbing or sanitary sewer

system).

hold Lessor, its agents, employees, lenders and ground lessor, if any, and the

Premises, harmless from and against any and all damages, liabilities, judgments,

costs, claims, liens, expenses, penalties, loss of permits and attorneys' and

consultants' fees arising out of or Involving any Hazardous Substance brought

onto the Premises by or for Lessee or by anyone under Lessee's control. Lessee's

obligations under this Paragraph 6.2(c) shall Include, but not be limited to,

the effects of any contamination or Injury to person, properly or the

environment created or suffered by Lessee, and the cost of Investigation

(including consultants' and attorneys' fees and testing), removal, remediation,

restoration and/or abatement thereof, or of any contamination therein Involved,

and shall survive the expiration or earlier termination of this Lease. No

termination, cancellation or release agreement entered into by Lessor and Lessee

shall release Lessee from Its obligations under this Lease with respect to

Hazardous Substances, unless specifically so agreed by Lessor In writing at the

time of such agreement.

6.3 Lessee's Compliance with Requirements. Lessee shall, at Lessee's

sole cost and expense, fully, diligently and In a timely manner, comply with all

"Applicable Requirements," which term Is used In this Lease to mean all laws,

rules, regulations, ordinances, directives, covenants, easements and

restrictions of record, permits, the requirements of any applicable fire

Insurance underwriter or rating bureau, and the recommendations of Lessor's

engineers and/or consultants, relating in any manner to the Premises (Including

but not limited to matters pertaining to (i) Industrial hygiene, (ii)

environmental conditions on, in, under or about the Premises, including soli and

groundwater conditions, and (iii) the use, generation, manufacture, production,

Installation, maintenance, removal, transportation, storage, spill, or release

of any Hazardous Substance), now In effect or which may hereafter come Into

elect. Lessee shall, within live (5) days after receipt of Lessor's written

request, provide Lessor with copies of all documents and Information, Including

but not limited to permits, registrations, manifests, applications, reports and

certificates, evidencing Lessee's compliance with any Applicable Requirements

specified by Lessor, and shall immediately upon receipt, notify Lessor in

writing (with copies of any documents Involved) of any threatened or actual

claim, notice, citation, warning, complaint or report pertaining to or involving

failure by Lessee or the Premises to comply with any Applicable Requirements.

6.4 Inspection; Compliance with Law. Lessor, Lessor's agents,

employees, contractors and designated representatives, and the holders of any

mortgages, deeds of trust or ground teases on the Premises ("Lenders") shall

have the right to enter the Premises at any time In the case of an emergency,

and otherwise at reasonable times, for the purpose of inspecting the condition

of the Premises and for verifying compliance by Lessee with this Lease and all

Applicable Requirements (as defined In Paragraph 6.3), and Lessor shall be

entitled to employ experts and/or consultants in connection therewith to advise

Lessor with respect to Lessee's activities, Including but not limited to

Lessee's Installation, operation, use, monitoring, maintenance, or removal of

any Hazardous Substance on or tram the Premises. The costs and expenses of any

such Inspections shall be paid by the party requesting same, unless a Default or

Breach of this Lease by Lessee or a violation of Applicable Requirements or a

contamination, caused or materially contributed to by Lessee, is found to exist

or to be imminent, or unless the inspection Is requested or ordered by a

governmental authority as the result of any such existing or Imminent violation

or contamination. In such case, Lessee shall upon request reimburse Lessor or

Lessor's Lender, as the case may be, for the costs and expenses of such

Inspections.

7. Maintenance, Repairs, Utility Installations, Trade Fixtures and Alterations.

7.1 Lessee's Obligations.

(a) Subject to the provisions of Paragraphs 2.2 (Condition), 2.3

(Compliance with Covenants, Restrictions and Building Code), 7.2 (Lessor's

Obligations), 9 (Damage or Destruction), and 14 (Condemnation), Lessee shall, at

Lessee's sole cost and expense and at all times, keep the Premises and every pan

thereof in good order, condition and repair (whether or not such portion of the

Premises requiring repair, or the means of repairing the same, are reasonably or

readily accessible to Lessee, and whether or not the need for such repairs

occurs as a result of Lessee's use, any prior use, the elements or the age of

such portion of the Premises), Including, without limiting the generality of the

foregoing, all equipment or facilities specifically serving the Premises, such

as plumbing, heating, air conditioning, ventilating, electrical, lighting

facilities, boilers, fired or unfired pressure vessels, fire hose connections if

within the Premises, fixtures, Interior walls, interior surfaces of exterior

walls, ceilings, floors, windows, doors, plate glass, and skylights, but

excluding any Items which are the responsibility of Lessor pursuant to Paragraph

7.2 below. Lessee, in keeping the Premises in good order, condition and repair,

shall exercise and perform good maintenance practices. Lessee's obligations

shall include restorations, replacements or renewals when necessary to keep the

Premises and all improvements thereon or a part thereof in good order, condition

and state of repair.

(b) Lessee shall, al Lessee's sole cost and expense, at Lessee's

option, procure and maintain a contract, with copies to Lessor, In customary

form and substance for and with a contractor specializing and experienced In the

Inspection, maintenance and service of the healing, air conditioning and

ventilation system for the Premises. However, Lessor reserves the right, upon

notice to Lessee, to procure and maintain the contract for the heating, air

conditioning and ventilating systems, and it Lessor so elects, Lessee shall

reimburse Lessor, upon demand, for the cost (hereof.

Paragraph 7.1, Lessor may enter upon the Premises after ten (10) days' prior

written notice to Lessee (except in the case of an emergency, in which case no

notice shall be required), perform such obligations on Lessee's behalf, and put

the Premises in good order, condition and repair, in accordance with Paragraph

13.2 below.

7.2 Lessor's Obligations. Subject to the provisions of Paragraphs 2.2

(Condition), 2.3 (Compliance with Covenants, Restrictions and Building Code),

4.2 (Common Area Operating Expenses), 6 (Use), 7.1 (Lessee's Obligations), 9

(Damage or Destruction) and 14 (Condemnation), Lessor, subject to reimbursement

pursuant to Paragraph 4.2, shall keep in good order, condition and repair the

foundations, exterior walls, structural condition of interior bearing walls,

exterior roof, fire sprinkler and/or standpipe and hose In good order, condition

and repair (if located in the Common Areas) the other automatic fire

extinguishing system including fire alarm and/or smoke detection systems and

equipment, tire hydrants, parking lots, walkways, parkways, driveways,

landscaping, lances, signs and utility systems serving the Common Areas and all

parts thereof, as well as providing the services for which there Is a Common

Area Operating Expense pursuant to Paragraph 4.2, Lessor shall not be obligated

to paint the exterior or Interior surfaces of exterior walls nor shall Lessor be

obligated to maintain, repair or replace windows, doors or plate glass of the

Premises. Lessee expressly waives the benefit of any statute now or hereafter in

effect which would otherwise afford Lessee the right to make repairs at Lessor's

expense or to terminate this Lease because of Lessor's failure to keep the

Building, Industrial Center or Common Areas In good order, condition and repair.

7.3 Utility Installations, Trade Fixtures, Alterations.

(a) Definitions; Consent Required. The term "Utility

Installations" Is used in this Lease to refer to all air lines, power panels,

electrical distribution, security, tire protection systems, communications

systems, lighting fixtures, healing, ventilating and air conditioning equipment,

plumbing, and fencing in, on or about the Premises. The term "Trade Fixtures"

shall mean Lessee's machinery and equipment which can be removed without doing

material damage to the Premises. The term "Alterations" shall mean any

modification of the Improvements on the Premises which are provided by Lessor

under the terms of this Lease, other than Utility Installations or Trade

Fixtures. "Lessee-Owned Alterations and/or Utility Installations" are defined as

Alterations and/or Utility Installations made by Lessee that are not yet owned

by Lessor pursuant to Paragraph 7.4(a). Lessee shall not make nor cause to be

made any Alterations or Utility Installations In, on, under or about the

Premises without Lessor's prior written consent. Lessee May, however, make

non-structural Utility Installations to the Interior of the Premises (excluding

the roof) without Lessor's consent but upon notice to Lessor, so long as they

are not visible from the outside of the Premises, do not Involve puncturing,

relocating or removing the roof or any existing walls, or changing or

Interfering with the fire sprinkler or fire detection systems and the cumulative

cost thereof during the term of this Lease as extended does not exceed

$2,500.00.

(b) Consent. Any Alterations or Utility Installations that Lessee

shall desire to make and which require the consent of the Lessor shall be

presented to Lessor In written form with detailed plans. All consents given by

Lessor, whether by virtue of Paragraph 7.3(a) or by subsequent specific consent,

shall be deemed conditioned upon: (i) Lessee's acquiring all applicable permits

required by governmental authorities; (ii) the furnishing of copies of such

permits together with a copy of the plans and specifications for the Alteration

or Utility Installation to Lessor prior to commencement of the work thereon; and

(iii) the compliance by Lessee with all conditions of said permits in a prompt

and expeditious manner. Any Alterations or Utility Installations by Lessee

during the term of this Lease shall be done in a good and workmanlike manner,

with good and sufficient materials, and be In compliance with all Applicable

Requirements. Lessee shall promptly upon completion thereof furnish Lessor with

as-built plans and specifications therefor. Lessor may, (but without obligation

to do so) condition Its consent to any requested Alteration or Utility

Installation that costs $2,500.00 or more upon Lessee's providing Lessor with a

lien and completion bond in an amount equal to one and one-hall times the

estimated cost of such Alteration or Utility Installation.

labor or materials furnished or alleged to have been furnished to or for Lessee

at or for use on the Premises, which claims are or may be secured by any

mechanic's or materialmen's lien against the Premises or any Interest therein.

Lessee shall give Lessor not less than ten (10) days' nonce prior to the

commencement of any work In, on, or about the Premises, and Lessor shall have

the right to post notices of non-responsibility In or on the Premises as

provided by law. II Lessee shall, In good faith, contest the validity of any

such lien, claim or demand, than Lessee shall, al its sole expense, defend and

protect Itself, Lessor and the Premises against the same and shall pay and

satiety any such adverse judgment that may be rendered thereon before the

enforcement thereof against the Lessor or the Premises. If Lessor shall require,

Lessee shall furnish to Lessor a surety bond satisfactory to Lessor In an amount

equal to one and one-half times the amount of such contested lien claim or

demand, Indemnifying Lessor against liability for the same, as required by law

for the holding of the Premises free from the effect of such Ilea or claim. In

addition, Lessor may require Lessee to pay Lessor's attorneys' fees and costs in

participating in such action if Lessor shall decide It Is to Its best Interest

to do so.

7.4 Ownership, Removal, Surrender, and Restoration.

(a) Ownership. Subject to Lessor's right to require their removal

and to cause Lessee to become the owner thereof as hereinafter provided in this

Paragraph 7.4, all Alterations and Utility Installations made to the Premises by

Lessee shall be the property of and owned by Lessee, but considered a part of

the Premises. Lessor may, at any time and at Its option, elect In writing to

Lessee to be the owner of all or any specified part of the Lessee-Owned

Alterations and Utility Installations. Unless otherwise Instructed per

Subparagraph 7.4(b) hereof, all Lessee-Owned Alterations and Utility

Installations shall, at the expiration or earlier termination of this Lease,

become the property of Lessor and remain upon the Premises and be surrendered

with the Premises by Lessee.

(b) Removal. Unless otherwise agreed In writing, Lessor may

require that any or all Lessee-Owned Alterations or Utility Installations be

removed by the expiration or earlier termination of this Lease, notwithstanding

that their Installation may have been consented to by Lessor. Lessor may require

the removal at any time of all or any part of any Alterations or Utility

Installations made without the required consent of Lessor.

the end of the last day of the Lease term or any earlier termination xxxx, clean

and free of debris and in good operating order, condition and stale of repair,

ordinary wear and tear excepted. Ordinary wear and tear shall not include any

damage or deterioration that would have been prevented by good maintenance

practice or by Lessee performing all of its obligations under this Lease. Except

as otherwise agreed or specified herein, the Premises, as surrendered, shall

include the Alterations and Utility Installations. The obligation of Lessee

shall Include the repair of any damage occasioned by the Installation,

maintenance or removal of Lessee's Trade Fixtures, furnishings, equipment, and

Lessee-Owned Alterations and Utility Installations, as well as the removal of

any storage tank Installed by or for Lessee, and the removal, replacement, or

remediation of any soil, material or ground water contaminated by Lessee, all as

may than be required by Applicable Requirements and/or good practice. Lessee's

Trade Fixtures shall remain the property el Lessee and shall be removed by

Lessee subject to its obligation to repair and restore the Premises per this

Lease.

8. Insurance; indemnity.

8.1 Payment of Premium Increases.

(a) As used herein, the term "Insurance Cost Increase" Is defined

as any Increase In the actual cost of the Insurance applicable to the Building

and required to be carried by Lessor pursuant to Paragraphs 8.2(b), 8.3(a) and

8.3(b), ("Required Insurance"), over and above the Base Premium, as hereinafter

defined, calculated on an annual basis. "Insurance Cost Increase" shall Include,

but not be limited to, requirements of the holder of a mortgage or deed of trust

covering the Premises, Increased valuation of the Premises, and/or a general

premium rate Increase. The term "Insurance Cost Increase" shall not, however,

include any premium Increases resulting from the nature of the occupancy of any

other lessee of the Building. II the parties insert a dollar amount In Paragraph

1.9, such amount shall be considered the "Base Premium." If a dollar amount has

not been Inserted In Paragraph 1.9 and If the Building has been previously

occupied during the twelve (12) month period Immediately preceding the

Commencement Date, the "Base Premium" shall be the annual premium applicable to

such twelve (12) month period. If the Building was not fully occupied during

such twelve (12) month period, the "Base Premium" shall be the lowest annual

premium reasonably obtainable for the Required Insurance as of the Commencement

Date, assuming the most nominal use possible of the Building. In no event,

however, shall Lessee be responsible for any portion of the premium cost

attributable to liability Insurance coverage In excess of $1,000,000 procured

under Paragraph 8.2(b).

(b) Lessee shall pay any Insurance Cost Increase to Lessor

pursuant to Paragraph 4.2. Premiums for policy periods commencing prior to, or

extending beyond, the term of this Lease shall be prorated to coincide with the

corresponding Commencement Xxxx or Expiration Date.

8.2 Liability Insurance.

(a) Carried by Lessee, Lessee shall obtain and keep in force

during the term of this Lease a Commercial General Liability policy of Insurance

protecting Lessee, Lessor and any Lender(s) whose names have been provided to

Lessee In writing (as additional insureds) against claims for bodily Injury,

personal injury and property damage based upon, Involving or arising out of the

ownership, use, occupancy or maintenance of the Premises and all areas

appurtenant thereto. Such Insurance shell be on an occurrence basis providing

single limit coverage In an amount not less than $1,000,000 per occurrence with

an "Additional Insured-Managers or Lessor's of Premises" endorsement and contain

the "Amendment of the Pollution Exclusion" endorsement for damage caused by

heat, smoke or fumes from a hostile fire. The policy shall not contain any

Intra-Insured exclusions as between Insured persons or organizations, but shall

include coverage for liability assumed under this Lease as an "Insured contract"

for the performance of Lessee's Indemnity obligations under this Lease. The

limits of said insurance required by this Lease or as carried by Lessee shall

not, however, Iimit the liability of Lessee nor relieve Lessee of any obligation

hereunder. All Insurance to be carried by Lessee shall be primary to and not

contributory with any similar Insurance carried by Lessor, whose insurance shall

be considered excess Insurance only.

(b) Carried by Lessor. Lessor shall also maintain liability

Insurance described In Paragraph 8.2(a) above, in addition to and not In lieu

of, the insurance required to be maintained by Lessee. Lessee shall not be named

as an additional Insured therein.

8.3 Property Insurance-Building, Improvements and Rental Value.

(a) Building and Improvements. Lessor shall obtain and keep In

force during the term of this Lease a policy or policies In the name of Lessor,

with loss payable to Lessor and to any Lender(s), Insuring against loss or

damage to the Premises. Such Insurance shall,be for full replacement cost, as

the same shall exist from time to time, or the amount required by any Lender(s),

but In no event more than the commercially reasonable and available Insurable

value thereof If, by reason of the unique nature or age of the Improvements

Involved, such latter amount Is less than full replacement cost. Lessee-Owned

Alterations and Utility Installations, Trade Fixtures and Lessee's personal

property shall be insured by Lessee pursuant to Paragraph 8.4. If the coverage

Is available and commercially appropriate, Lessor's policy or policies shall

Insure against all risks of direct physical loss or damage (except the perils of

flood end/or earthquake unless required by a Lender or included In the Base

Premium), Including coverage for any additional costs resulting from debris

removal and reasonable amounts of coverage for the enforcement of any ordinance

or law regulating the reconstruction or replacement of any undamaged sections of

the Building required to be demolished or removed by reason of the enforcement

of any building, zoning, safety or land use laws as the result of a covered

loss, but not Including plate glass insurance. Said policy or policies shall

also contain an agreed valuation provision In lieu of any co-Insurance clause,

waiver of subrogation, and inflation guard protection causing an Increase in the

annual property Insurance coverage amount by a factor of not less than the

adjusted U.S. Department of Labor Consumer Price Index for All Urban Consumers

for the city nearest to where the Premises are located.

(b) Rental Value. Lessor shall also obtain and keep in force

during the term of this Lease a policy or policies In the name of Lessor, with

loss payable to Lessor and any Lender(s), Insuring the loss of the full rental

and other charges payable by all lessees of the Betiding to Lessor for one year

(Including all Real Property Taxes, Insurance costs, all Common Area Operating

Expenses and any scheduled rental Increases). Said Insurance may provide that in

the event the Lease Is terminated by reason of an Insured loss, the period of

Indemnity for such coverage shall be extended beyond the date of the completion

of repairs or replacement of the Premises, to provide for one lull year's loss

of rental revenues from the date of any such loss. Said Insurance shall contain

an agreed valuation provision In lieu of any co-Insurance clause, and the amount

of coverage shall be adjusted annually to reflect the projected rental Income,

Real Property Taxes, Insurance premium costs and other expenses, If any,

otherwise payable, for the next 12-month period. Common Area Operating Expenses

shall include any deductible amount In the event of such loss.

premiums for the property Insurance of the Building and for the Common Areas or

other buildings in the Industrial Center II said Increase Is caused by Lessee's

acts, omissions, use or occupancy of the Premises.

(d) Lessee's Improvements. Since Lessor Is the Insuring Party,

Lessor shall not be required to Insure Lessee-Owned Alterations and Utility

Installations unless the Item In question has become the property of Lessor

under the terms of this Lease.

8.4 Lessee's Property Insurance. Subject to the requirements of

Paragraph 8.5, Lessee at Its cost shall either by separate policy or, at

Lessor's option, by endorsement to a policy already carried, maintain Insurance

coverage on all of Lessee's personal property, Trade Fixtures and Lessee-Owned

Alterations and Utility Installations in, on, or about the Premises similar In

coverage to that carried by Lessor as the Insuring Party under Paragraph 8.3(a).

Such Insurance shall be lull replacement cost coverage with a deductible not to

exceed $1,000 per occurrence. The proceeds from any such Insurance shall be used

by Lessee for the replacement of personal property and the restoration of Trade

Fixtures and Lessee-Owned Alterations and Utility Installations. Upon request

tram Lessor, Lessee shall provide Lessor with written evidence that such

Insurance is in force.

8.5 Insurance Policies. Insurance required hereunder shall be in

companies duly licensed to transact business in the state where the Premises are

located, and maintaining during the policy term a "General Policyholders Rating"

01 at least Be, V, or such other rating as may be required by a Lender, as set

forth In the most current Issue of "Best's Insurance Guide." Lessee shall not do

or permit to be done anything which shall invalidate the Insurance policies

referred to in this Paragraph 8. Lessee shall cause to be delivered to Lessor,

within seven (7) days after the earlier of the Early Possession Data or the

Commencement Date, certified copies of, or certificates evidencing the existence

and amounts of, the Insurance required under Paragraph 6.2(a) and 8.4. No such

policy shall be cancelable or subject to modification except after thirty (30)

days' prior written notice to Lessor. Lessee shall at least thirty (30) days

prior to the expiration of such policies, furnish Lessor with evidence of

renewals or "Insurance binders" evidencing renewal thereof, or Lessor may order

such Insurance and charge the cost thereof to Lessee, which amount shall be

payable by Lessee to Lessor upon demand.

8.6 Waiver of Subrogation. Without affecting any other rights or

remedies, Lessee and Lessor each hereby release and relieve the other, and waive

their entire right to recover damages (whether in contract or In tort) against

the other, for loss or damage to their property arising out of or Incident to

the perils required to be insured against under Paragraph 8. The effect of such

releases and waivers of the right to recover damages shall not be limited by the

amount of Insurance carried or required or by any deductibles applicable

thereto. Lessor and Lessee agree to have their respective Insurance companies

Issuing property damage Insurance waive any right to subrogation that such

companies may have against Lessor or Lessee, as the case may be, so long as the

Insurance is not invalidated thereby.

8.7 Indemnity. Except for Lessor's negligence and/or breach of express

warranties, Lessee shall Indemnity, protect, defend and hold harmless the

Premises, Lessor and Its agents, Lessor's master or ground Lessor, partners and

Lenders, from and against any and all claims, loss of rents and/or damages,

costs, liens, judgments, penalties, loss of permits, attorneys' and consultants'

lees, expenses and/or liabilities arising out of, Involving, or In connection

with, the occupancy of the Premises by Lessee, the conduct o1 Lessee's business,

any act, omission or neglect of Lessee, Its agents, contractors, employees or

Invitees, and out of any Default or Breach by Lessee In the performance in a

timely manner of any obligation on Lessee's part to be performed under this

Lease. The foregoing shall include, but not be limited to, the defense or

pursuit of any claim or any action or proceeding Involved therein, and whether

or not (In the case of claims made against Lessor) litigated and/or reduced to

Judgment. In case any action or proceeding be brought against Lessor by reason

of any of the foregoing matters, Lessee upon notice from Lessor shall defend the

same at Lessee's expense by counsel reasonably satisfactory to Lessor and Lessor

shall cooperate with Lessee in such defense. Lessor need not have first paid any

such claim In order to be so indemnified.

8.8 Exemption of Lessor from Liability. Lessor shall not be liable for

Injury or damage to the person or goods, wares, merchandise or other property of

Lessee, Lessee's employees, contractors, Invitees, customers, or any other

person in or about the Premises, whether such damage or Injury is caused by or

results from fire, steam, electricity, gas, water or rain, or from the breakage,

leakage, obstruction or other detects of pipes, fire sprinklers, wires,

appliances, plumbing, air conditioning or lighting fixtures, or from any other

cause, whether said Injury or damage results from conditions arising upon the

Premises or upon other portions of the Building of which the Premises are a

part, from other sources or places, and regardless of whether the cause of such

damage or Injury or the means of repairing the same Is accessible or not. Lessor

shall not be liable for any damages arising from any act or neglect of any other

lessee of Lessor nor from the failure by Lessor to enforce the provisions of any

other lease In the Industrial Center. Notwithstanding Lessor's negligence or

breach of this Lease, Lessor shall under no circumstances be liable for injury

to Lessee's business or for any loss of Income or profit therefrom.

9. Damage or Destruction.

9.1 Definitions.

(a) "Premises Partial Damage" shall mean damage or destruction to

the Premises, other than Lessee-Owned Alterations and Utility Installations, the

repair cost of which damage or destruction Is less than fifty percent (50%) of

the then Replacement Cost (as defined In Paragraph 9.1(d)) of the Premises

(excluding Lessee-Owned Alterations and Utility Installations and Trade

Fixtures) immediately prior to such damage or destruction.

(b) "Premises Total Destruction" shall mean damage or destruction

to the Premises, other than Lessee-Owned Alterations and Utility Installations,

the repair cost of which damage or destruction Is fifty percent (50%) or more of

the Then Replacement Cost of the Premises (excluding Lessee-Owned Alterations

and Utility Installations and Trade Fixtures) Immediately prior to such damage

or destruction. In addition, damage or destruction to the Building, other than

Lessee Owned Alterations and Utility Installations and Trade Fixtures of any

lessees of the Building, the cost of which damage or destruction Is fifty

percent (50%) or more of the then Replacement Cost (excluding Lessee-Owned

Alterations and Utility Installations and Trade Fixtures of any lessees of the

Building) of the Building shall, at the option of Lessor, be deemed to be

Premises Total Destruction.

Premises, other than Lessee-Owned Alterations and Utility Installations and

Trade Fixtures, which was caused by an event required to be covered by the

Insurance described In Paragraph 8.3(a) irrespective of any deductible amounts

or coverage limns involved.

(d) "Replacement Cost" shall mean the cost to repair or rebuild

the Improvements owned by Lessor at the time of the occurrence to their

condition existing immediately prior thereto, including demolition, debris

removal and upgrading required by the operation of applicable building codes,

ordinances or laws, and without deduction for depreciation.

(e) "Hazardous Substance Condition" shall mean the occurrence or

discovery of a condition Involving the presence of, or a contamination by, a

Hazardous Substance as defined In Paragraph 6.2(a), in, on, or under the

Premises.

9.2 Premises Partial Damage--Insured Loss. If Premises Partial Damage

that is an Insured Loss occurs, then Lessor shall, at Lessor's expense, repair

such damage (but not Lessee's Trade Fixtures or Lessee-Owned Alterations and

Utility Installations) as soon as reasonably possible and this Lease shall

continue in lull force and effect. In the event, however, that there Is a

shortage of insurance proceeds and such shortage is due to the fact that, by

reason of the unique nature of the Improvements In the Premises, lull

replacement cost Insurance coverage was not commercially reasonable and

available, Lessor shall have no obligation to pay for the shortage In Insurance

proceeds or to fully restore the unique aspects of the Premises unless Lessee

provides Lessor with the funds to cover same, or adequate assurance thereof,

within ten (10) days following receipt of written notice of such shortage and

request therefor. If Lessor receives said funds or adequate assurance thereof

within said ten (10) day period, Lessor shall complete them as soon as

reasonably possible and this Lease shall remain in full force and effect. If

Lessor does not receive such funds or assurance within said period, Lessor may

nevertheless elect by written notice to Lessee within ten (10) days thereafter

to make such restoration and repair as is commercially reasonable with Lessor

paying any shortage in proceeds, In which case this Lease shall remain in lull

force and effect. If Lessor does not receive such funds or assurance within such

ten (10) day period, and If Lessor does not so elect to restore and repair, then

this Lease shall terminate sixty (60) days following the occurrence of the

damage or destruction. Unless otherwise agreed, Lessee shall in no event have

any right to reimbursement from Lessor for any funds contributed by Lessee to

repair any such damage or destruction. Premises Partial Damage due to flood or

earthquake shall be subject to Paragraph 9.3 rather than Paragraph 9.2,

notwithstanding that there may be some Insurance coverage, but the net proceeds

of any such insurance shall be made available for the repairs if made by either

Party.

9.3 Partial Damage--Uninsured Loss. If Premises Partial Damage that Is

not an Insured Loss occurs, unless caused by a negligent or willful act of

Lessee (in which event Lessee shall make the repairs at Lessee's expense and

this Lease shall continue In full force and effect), Lessor may at Lessor's

option, either (i) repair such damage as soon as reasonably possible at Lessor's

expense, In which event this Lease shall continue In lull force and effect, or

(ii) give written notice to Lessee within thirty (30) days after receipt by

Lessor of knowledge of the occurrence of such damage of Lessor's desire to

terminate this Lease as of the date sixty (60) days following the date of such

notice. In the event Lessor elects to give such notice of Lessor's Intention to

terminate this Lease, Lessee shall have the right within ten (10) days after the

receipt of such notice to give written notice to Lessor of Lessee's commitment

to pay for the repair of such damage totally al Lessee's expense and without

reimbursement from Lessor. Lessee shall provide Lessor with the required funds

or satisfactory assurance thereof within thirty (30) days following such

commitment from Lessee. In such event this Lease shall continue in full force

and effect, and Lessor shall proceed to make such repairs as soon as reasonably

possible alter the required funds are available. If Lessee does not give such

notice and provide the funds or assurance thereof within the times specified

above, This Lease shall terminate as of the xxxx specified In Lessor's notice of

termination.

9.4 Total Destruction. Notwithstanding any other provision hereof, II

Premises Total Destruction occurs (including any destruction required by any

authorized public authority), this Lease shall terminate sixty (60) days

following the xxxx of such Premises Total Destruction, whether or not the damage

or destruction is an Insured Loss or was caused by a negligent or willful act of

Lessee. In the event, however, that the damage or destruction was caused by

Lessee. Lessor shall have the right to recover Lessor's damages from Lessee

except as released and waived in Paragraph 9.7.

9.5 Damage Near End of Term. II at any time during the last six (6)

months of the term of this Lease there is damage for which the cost to repair

exceeds one month's Base Rent, whether or not an Insured Loss, Lessor may, at

Lessor's option, terminate this Lease effective sixty (60) days following the

date of occurrence o1 such damage by giving written notice to Lessee of Lessor's

election to do so within thirty (30) days alter the xxxx of occurrence of such

damage. Provided, however, If Lessee al that time has an exercisable option to

extend this Lease or to purchase the Premises, then Lessee may preserve this

Lease by (a) exercising such option, and (b) providing Lessor with any shortage

in Insurance proceeds (or adequate assurance thereof) needed to make the repairs

on or before the earlier of (i) the xxxx which Is Ian (10) days after Lessee's

receipt of Lessor's written notice purporting to terminate this Lease, or (ii)

the day prior to the xxxx upon which such option expires. If Lessee duly

exercises such option during such period and provides Lessor with funds (or

adequate assurance thereof) to cover any shortage in insurance proceeds, Lessor

shall, at Lessor's expense repair such damage as soon as reasonably possible and

this Lease shall continue in lull force and effect. II Lessee fails to exercise

such option and provide such funds or assurance during such period, then this

Lease shall terminate as of the date set forth in the first sentence of this

Paragraph 9.5.

9.6 Abatement of Rent; Lessee's Remedies.

(a) In the event of (i) Premises Partial Damage or (ii) Hazardous

Substance Condition for which Lessee is not legally responsible, the Base Rent,

Common Area Operating Expenses and other charges, if any, payable by Lessee

hereunder for the period during which such damage or condition, its repair,

remediation or restoration continues, shall be abated In proportion to the

degree 10 which Lessee's use of the Premises is impaired, but not in excess of

proceeds from insurance required to be carried under Paragraph 8.3(b). Except

for abatement of Base Rent, Common Area Operating Expenses and other charges, II

any, as aforesaid, all other obligations of Lessee hereunder shall be performed

by Lessee, and Lessee shall have no claim against Lessor for any damage sued by

reason of any such damage, destruction, repair, remediation or restoration.

(b) If Lessor shall be obligated to repair or restore the Premises

under the provisions of this Paragraph 9 and shall not commence, In a

substantial and meaningful way, the repair or restoration of the Premises within

ninety (90) days after such obligation shall accrue, Lessee may, at any time

prior to the commencement of such repair or restoration, give written notice to

Lessor and to any Lenders of which Lessee has actual notice of Lessee's election

to terminate this Lease on a data not less than sixty (60) days following the

giving of such notice. II Lessee gives such notice to Lessor and such Lenders

and such repair or restoration is not commenced within thirty (30) days after

receipt of such notice, this Lease shall terminate as of the date specified In

said notice, If Lessor or a Lender commences the repair or restoration of the

Premises within thirty (30) days after the receipt of such notice, this Lease

shall continue In lull force and effect. "Commence" as used In this Paragraph

9.6 shall mean either the unconditional authorization of the preparation of the

required plans, or the beginning of the actual work on the Premises, whichever

occurs first.

9.7 Hazardous Substance Conditions. If a Hazardous Substance Condition

occurs, unless Lessee Is legally responsible therefor (in which case Lessee

shall make the investigation and remediation thereof required by Applicable

Requirements and this Lease shall continue In lull force and effect, but subject

to Lessor's rights under Paragraph 6.2(c) and Paragraph 13), Lessor may at

Lessor's option either (i) Investigate and remediate such Hazardous Substance

Condition, if required, as soon as reasonably possible at Lessor's expense, In

which event this Lease shall continue In lull force and effect, or (ii) If the

estimated cost to investigate and remediate such condition exceeds twelve (12)

times the than monthly Base Rent or $100,000 whichever Is greater, give written

notice to Lessee within thirty (30) days alter receipt by Lessor of knowledge of

the occurrence of such Hazardous Substance Condition of Lessor's desire to

terminate this Lease as of the date sixty (60) days following the xxxx of such

notice. In the event Lessor elects to give such notice of Lessor's Intention to

terminate this Lease, Lessee shall have the right within ten (10) days alter the

receipt of such notice to give written notice to Lessor of Lessee's commitment

to pay for the excess costs of (a) Investigation and remediation of such

Hazardous Substance Condition to the extent required by Applicable Requirements,

over (b) an amount equal to twelve (12) times the then monthly Base Rent or

$100,000, whichever Is greater. Lessee shall provide Lessor with the funds

required of Lessee or satisfactory assurance thereof within thirty (30) days

following said commitment by Lessee. In such event this Lease shall continue In

lull force and effect, and Lessor shall proceed to make such investigation and

remediation as soon as reasonably possible alter the required funds are

available. If Lessee does not give such notice and provide the required funds or

assurance thereof within the time period specified above, this Lease shall

terminate as of the xxxx specified in Lessor's notice of termination.

9.8 Termination--Advance Payments. Upon termination of this Lease

pursuant to this Paragraph 9, Lessor shall return to Lessee any advance payment

made by Lessee to Lessor and so much of Lessee's Security Deposit as has not

been, or is not then required to be, used by Lessor under the terms of this

Lease.

9.9 Waiver of Statutes. Lessor and Lessee agree that the terms of this

Lease shall govern the effect of any damage to or destruction of the Premises

and the Building with respect to the termination of this Lease and hereby waive

the provisions of any present or future statute to the extent It Is Inconsistent

herewith.

10. Real Property Taxes.

10.1 Payment of Taxes. Lessor shall pay the Real Property Taxes, as

defined in Paragraph 10.2(a), applicable to the Industrial Center, and except as

otherwise provided In Paragraph 10.3, any Increases In such amounts over the

Base Real Property Taxes shall be Included In the calculation of Common Area

Operating Expenses in accordance with the provisions of Paragraph 4.2.

10.2 Reel Property Tax Definitions.

(a) As used herein, the term "Real Property Taxes" shall Include

any form of real estate tax or assessment, general, special, ordinary or

extraordinary, and any license fee, commercial rental tax, Improvement bond or

bonds, levy or tax (other than Inheritance, personal Income or estate taxes)

Imposed upon the Industrial Center by any authority having the direct or

Indirect power to lax, Including any city, state or federal government, or any

school, agricultural, sanitary, lire, street, drainage, or other Improvement

district thereof, levied against any legal or equitable Interest of Lessor In

the Industrial Center or any portion thereof, Lessor's right to rent or other

Income therefrom, and/or Lessor's business of leasing the Premises. The term

"Real Property Taxes" shall also Include any tax, lee, levy, assessment or

charge, or any increase therein, Imposed by reason of events occurring, or

changes In Applicable Law taking effect, during the term of this Lease,

including but not limited to a change In the ownership of the Industrial Center

or in the improvements thereon, the execution of this Lease, or any

modification, amendment or transfer thereof, and whether or not contemplated by

the Parties.

(b) As used herein, the term "Base Real Property Taxes" shall be

the amount of Real Property Taxes, which are assessed against the Premises,

Building or Common Areas In the calendar year during which the Lease is

executed. In calculating Real Property Taxes for any calendar year, the Real

Property Taxes for any real estate tax year shall be Included in the calculation

of Real Property Taxes for such calendar year based upon the number of days

which such calendar year and tax year have In common.

10.3 Additional Improvements. Common Area Operating Expenses shall not

Include Real Property Taxes specified in the tax assessor's records and work

sheets as being caused by additional Improvements placed upon the Industrial

Center by other lessees or by Lessor for the exclusive enjoyment of such other

lessees. Notwithstanding Paragraph 10.1 hereof, Lessee shall, however, pay to

Lessor at the time Common Area Operating Expenses are payable under Paragraph

4.2, the entirety of any Increase In Real Property Taxes II assessed solely by

reason of Alterations, Trade Fixtures or Utility Installations placed upon the

Premises by Lessee or at Lessee's request.

10.4 Joint Assessment. If the Building Is not separately assessed, Real

Property Taxes allocated to the Building shall be an equitable proportion of the

Real Property Taxes for all of the land and Improvements included within the tax

parcel assessed, such proportion to be determined by Lessor from the respective

valuations assigned in the assessor's work sheets or such other information as

may be reasonably available. Lessor's reasonable determination thereof, in good

faith, shall be conclusive.

10.5 Lessee's Property Taxes. Lessee shall pay prior to delinquency all

taxes assessed against and levied upon Lessee-Owned Alterations and Utility

Installations, Trade Fixtures, furnishings, equipment and all personal property

of Lessee contained In the Premises or stored within the Industrial Center. When

possible, Lessee shall cause Its Lessee-Owned Alterations and Utility

Installations, Trade Fixtures, furnishings, equipment and all other personal

property to be assessed and billed separately from the real property of Lessor.

If any of Lessee's said property shall be assessed with Lessor's real property,

Lessee shall pay Lessor the taxes attributable to Lessee's property within ten

(10) days after receipt of a written statement setting forth the taxes

applicable to Lessee's properly.

11. Utilities. Lessee shall pay directly for all utilities and services supplied

to the Premises, Including but not limited to electricity, telephone, security,

gas and cleaning of the Premises, together with any taxes thereon. If any such

utilities or services are not separately metered to the Premises or separately

billed to the Premises, Lessee shall pay to Lessor a reasonable proportion to be

determined by Lessor of all such charges jointly metered or billed with other

premises in the Building, In the manner and within the time periods set forth In

Paragraph 4.2(d).

12. Assignment and Subletting.

12.1 Lessor's Consent Required.

(a) Lessee shall not voluntarily or by operation of law assign,

transfer, mortgage or otherwise transfer or encumber (collectively, "assign") or

sublet all or any part of Lessee's Interest in this Lease or In the Premises

without Lessor's prior written consent given under and subject to the terms of

Paragraph 36.

(b) A change in the control of Lessee shall constitute an

assignment requiring Lessor's consent. The transfer, on a cumulative basis, of

twenty-five per cent (25%) or more of the voting control of Lessee shall

constitute a change in control for this purpose.

series of transactions (by way of merger, sale, acquisition, financing,

refinancing, transfer, leveraged buy-out or otherwise), whether or not a formal

assignment or hypothecation of this Lease or Lessee's assets occurs, which

results or will result in a reduction of the Net Worth of Lessee, as hereinafter

defined, by an amount equal to or greater than twenty-five percent (25%) of such

Net Worth of Lessee as it was represented to Lessor al the time of full

execution and delivery of this Lease or at the time of the most recent

assignment to which Lessor has consented, or as It exists Immediately prior to

said transaction or transactions constituting such reduction, at whichever time

said Net Worth of Lessee was or is greater, shall be considered an assignment of

this Lease by Lessee to which Lessor may reasonably withhold its consent. "Net

Worth of Lessee" for purposes of this Lease shall be the net worth of Lessee

(excluding any Guarantors) established under generally accepted accounting

principles consistently applied.

(d) An assignment or subletting of Lessee's Interest In this Lease

without Lessor's specific prior written consent shall, al Lessor's option, be a

Default curable after notice per Paragraph 13.1, or a non-curable Breach without

the necessity of any notice and grace parted. If Lessor elects to treat such

unconsented to assignment or subletting as a non-curable Breach, Lessor shall

have the right to either: (i) terminate this Lease, or (ii) upon thirty (30)

days' written notice ("Lessor's Notice"), Increase the monthly Base Rent for the

Premises to the greater of the then fair market rental value of the Premises, as

reasonably determined by Lessor, or one hundred ten percent (110%) of the Base

Rent then In effect. Pending determination of the new fair market rental value,

if disputed by Lessee, Lessee shall pay the amount set forth in Lessor's Notice,

with any overpayment credited against the next Installment(s) of Base Rent

coming due, and any underpayment for the period retroactively to the effective

date of the adjustment being due and payable immediately upon the determination

thereof. Further, in the event of such Breach and rental adjustment, (i) the

purchase price of any option to purchase the Premises held by Lessee shall be

subject to similar adjustment to the then lair market value as reasonably

determined by Lessor (without the Lease being considered an encumbrance or any

deduction for depreciation or obsolescence, and considering the Premises at its

highest and best use and In good condition) or one hundred ten percent (110%) of

the price previously in effect, (ii) any index-oriented rental or price

adjustment formulas contained In this Lease shall be adjusted to require that

the base Index be determined with reference to the index applicable to the time

of such adjustment, and (iii) any used rental adjustments scheduled during the

remainder of the Lease term shall be increased in the same ratio as the new

rental bears to the Base Rent In effect Immediately prior to the adjustment

specified In Lessor's Notice.

(e) Lessee's remedy for any breach of this Paragraph 12.1 by

Lessor shall be limited to compensatory damages and/or injunctive relief.

12.2 Terms and Conditions Applicable to Assignment and Subletting.

(a) Regardless of Lessor's consent, any assignment or subletting

shall not (i) be effective without the express written assumption by such

assignee or sublessee of the obligations of Lessee under this Lease, (ii)

release Lessee of any obligations hereunder, nor (iii) alter the primary

liability of Lessee for the payment of Base Rent and other sums due Lessor

hereunder or for the performance of any other obligations to be performed by

Lessee under this Lease.

(b) Lessor may accept any rent or performance of Lessee's

obligations from any person other than Lessee pending approval or disapproval of

an assignment. Neither a delay in the approval or disapproval of such assignment

nor the acceptance of any rent for performance shall constitute a waiver or

estoppel of Lessor's right to exercise its remedies for the Default or Breach by

Lessee of any of the terms, covenants or conditions of this Lease.

not constitute a consent to any subsequent assignment or subletting by Lessee or

to any subsequent or successive assignment or subletting by the assignee or

sublessee. However, Lessor may consent to subsequent sublettings and assignments

of the sublease or any amendments or modifications thereto without notifying

Lessee or anyone else liable under this Lease or the sublease and without

obtaining their consent, and such action shall not relieve such persons from

liability under this Lease or the sublease.

(d) In the event of any Default or Breach of Lessee's obligation

under this Lease, Lessor may proceed directly against Lessee, any Guarantors or

anyone else responsible Tor the performance of the Lessee's obligations under

this Lease, Including any sublessee, without first exhausting Lessor's remedies

against any other person or entity responsible therefor to Lessor, or any

security held by Lessor.

(e) Each request for consent to an assignment or subletting shall

be In writing, accompanied by Information relevant to Lessor's determination as

to the financial and operational responsibility and appropriateness of the

proposed assignee or sublessee, Including but not limited to the Intended use

and/or required modification of the Premises, II any, together with a

non-refundable deposit of $1,000 or ten percent (10%) of the monthly Base Rent

applicable to the portion of the Premises which is the subject of the proposed

assignment or sublease, whichever Is greater, as reasonable consideration for

Lessor's considering and processing the request for consent. Lessee agrees to

provide Lessor with such other or additional Information and/or documentation as

may be reasonably requested by Lessor.

(f) Any assignee of, or sublessee under, This Lease shall, by

reason of accepting such assignment or entering Into such sublease, be deemed,

for the benefit of Lessor, to have assumed and agreed to conform and comply with

each and every term, covenant, condition and obligation herein to be observed or

performed by Lessee during the term of said assignment or sublease, other than

such obligations as are contrary to or Inconsistent with provisions of an

assignment or sublease to which Lessor has specifically consented in writing.

(g) The occurrence of a transaction described In Paragraph 12.2(c)

shall give Lessor the right (but not the obligation) to require that the

Security Deposit be Increased by an amount equal to six (6) times the then

monthly Base Rent, and Lessor may make the actual receipt by Lessor of the

Security Deposit Increase a condition to Lessor's consent to such transaction.

(h) Lessor, as a condition to giving Its consent to any assignment

or subletting, may require that the amount and adjustment schedule of the rent

payable under this Lease be adjusted to what is .then the market value and/or

adjustment schedule for property similar lo the Premises as then constituted, as

determined by Lessor.

12.3 Additional Terms and Conditions Applicable to Subletting. The

following terms and conditions shall apply to any subletting by Lessee of all or

any pan of the Premises and shall be deemed Included In all subleases under this

Lease whether or not expressly incorporated therein:

(a) Lessee hereby assigns and transfers to Lessor all of Lessee's

Interest In all rentals and Income arising from any sublease of all or a portion

of the Premises heretofore or hereafter made by Lessee, and Lessor may collect

such rent and Income and apply same toward Lessee's obligations under this

Lease; provided, however, that until a Breach (as defined In Paragraph 13.1)

shall occur In the performance of Lessee's obligations under this Lease, Lessee

may, except as otherwise provided In this Lease, receive, collect and enjoy the

rents accruing under such sublease. Lessor shall not, by reason of the foregoing

provision or any other assignment of such sublease to Lessor, nor by reason of

the collection of the rents from a sublessee, be deemed liable to the sublessee

for any failure of Lessee to perform and comply with any of Lessee's obligations

to such sublessee under such Sublease. Lessee hereby irrevocably authorizes and

directs any such sublessee, upon receipt of a written notice from Lessor stating

that a Breach exists in the performance of Lessee's obligations under this

Lease, to pay to Lessor the rents and other charges due and to become due under

the sublease. Sublessee shall rely upon any such statement and request from

Lessor and shall pay such rents and other charges to Lessor without any

obligation or right to inquire as to whether such Breach exists and

notwithstanding any notice from or claim from Lessee to the contrary. Lessee

shall have no right or claim against such sublessee, or, until the Breach has

been cured, against Lessor, for any such rents and other charges so paid by said

sublessee to Lessor.

(b) In the event of a Breech by Lessee In the performance of its

obligations under this Lease, Lessor, at Its option and without any obligation

to do so, may require any sublessee to attorn to Lessor, in which event Lessor

shall undertake the obligations of the sublessor under such sublease from the

time of the exercise of said option to the expiration of such sublease;

provided, however, Lessor shall not be liable for any prepaid rents or security

deposit paid by such sublessee to such sublessor or for any other prior defaults

or breaches of such sublessor under such sublease.

under a sublease shall also require the consent of Lessor herein.

(d) No sublessee under a sublease approved by Lessor shall further

assign or sublet all or any part of the Premises without Lessor's prior written

consent.

(e) Lessor shall deliver a copy of any notice of Default or Breach

by Lessee to the sublessee, who shell have the right to cure the Default of

Lessee within the grace period, 11 any, specified In such notice. The sublessee

shall have a right of reimbursement and offset from and against Lessee for any

such Defaults cured by the sublessee.

13. Default; Breech; Remedies.

13.1 Default; Breach. Lessor and Lessee agree that if an attorney Is

consulted by Lessor in connection with a Lessee Default or Breach (as

hereinafter defined), $350.00 is a reasonable minimum sum per such occurrence

for legal services and costs In the preparation and service of a notice of

Default, and that Lessor may include the cost of such services and costs In said

notice as rent due and payable to cure said default. A "Default" by Lessee Is

defined as a failure by Lessee to observe, comply with or perform any of the

terms, covenants, conditions or rules applicable to Lessee under this Lease. A

"Breach" by Lessee Is defined as the occurrence of any one or more of the

following Defaults, and, where a grace period for cure after notice Is specified

herein, the failure by Lessee to cure such Default prior to the expiration of

the applicable grace period, and shall entitle Lessor to pursue the remedies set

forth In Paragraphs 13.2 and/or 13.3:

(a) The vacating of the Premises without the Intention to reoccupy

same, or the abandonment of the Premises.

(b) Except as expressly otherwise provided In this Lease, the

failure by Lessee to make any payment of Base Rent, Lessee's Share of Common

Area Operating Expenses, or any other monetary payment required to be made by

Lessee hereunder as and when due, the (allure by Lessee to provide Lessor with

reasonable evidence of insurance or surety bond required under this Lease, or

the failure of Lessee to fulfill any obligation under this Lease which endangers

or threatens life or property, where such failure continues for a period of

three (3) days following written notice thereof by or on behalf of Lessor to

Lessee.

failure by Lessee to provide Lessor with reasonable written evidence (in duly

executed original form, if applicable) of (i) compliance with Applicable

Requirements per Paragraph 6.3, (ii) the inspection, maintenance and service

contracts required under Paragraph 7.1(b), (iii) the rescission of an

unauthorized assignment or subletting per Paragraph 12.1, (iv) a Tenancy

Statement per Paragraphs 16 or 37, (v) the subordination or non-subordination of

this Lease per Paragraph 30, (vi) the guaranty of the performance of Lessee's

obligations under this Lease it required under Paragraphs 1.11 and 37, (vii) the

execution of any document requested under Paragraph 42 (easements), or (All) any

other documentation or information which Lessor may reasonably require of Lessee

under the terms of this lease, where any such failure continues fore period of

ten (10) days following written notice by or on behalf of Lessor to Lessee.

(d) A Default by Lessee as to the terms, covenants, conditions or

provisions of this Lease, or of the rules adopted under Paragraph 40 hereof that

are to be observed, complied with or performed by Lessee, other than those

described In Subparagraphs 13.1(a), (b) or (c), above, where such Default

continues for a period of thirty (30) days after written notice thereof by or on

behalf of Lessor to Lessee; provided, however, that If the nature of Lessee's

Default is such that more than thirty (30) days are reasonably required (or its

cure, then it shall not be deemed to be a Breach of this Lease by Lessee If

Lessee commences such cure within said thirty (30) day period and thereafter

diligently prosecutes such cure to completion.

(e) The occurrence of any of the following events: (i) the making

by Lessee of any general arrangement or assignment for the benefit of creditors;

(ii) Lessee's becoming a "debtor" as defined in 11 U.S. Code Section 101 or any

successor statute thereto (unless, in the case of a petition flied against

Lessee, the same Is dismissed within sixty (60) days); (iii) the appointment of

a trustee or receiver to take possession of substantially all of Lessee's assets

located at the Premises or of Lessee's Interest In this Lease, where possession

Is not restored to Lessee within thirty (30) days; or (iv) the attachment,

execution or other judicial seizure o1 substantially all of Lessee's assets

located at the Premises or of Lessee's Interest in this Lease, where such

seizure is not discharged within thirty (30) days; provided, however, In the

event that any provision of this Subparagraph 13.1(e) is contrary to any

applicable law, such provision shall be of no force or effect, and shall not

affect the validity of the remaining provisions.

(f) The discovery by Lessor that any financial statement of Lessee

or of any Guarantor, given to Lessor by Lessee or any Guarantor, was materially

(g) If the performance of Lessee's obligations under this Lease is

guaranteed: (i) the death of a Guarantor, (ii) the termination of a Guarantor's

liability with respect to this Lease other Than In accordance with the terms of

such guaranty, (iii) a Guarantor's becoming Insolvent or the subject of a

bankruptcy filing, (iv) a Guarantor's refusal to honor the guaranty, or (v) a

Guarantor's breach of its guaranty obligation on an anticipatory breach basis,

and Lessee's failure, within sixty (60) days following written notice by or on

behalf of Lessor to Lessee of any such event, to provide Lessor with written

alternative assurances of security, which, when coupled with the then existing

resources of Lessee, equals or exceeds the combined financial resources of

Lessee and the Guarantors that existed at the time of execution of this Lease.

13.2 Remedies. If Lessee tells to perform any affirmative duty or

obligation of Lessee under this Lease, within ten (10) days after written notice

to Lessee (or in case of an emergency, without notice), Lessor may at Its option

(but without obligation to do so), perform such duty or obligation on Lessee's

behalf, including but not limited to the obtaining of reasonably required bonds,

insurance policies, or governmental licenses, permits or approvals. The costs

and expenses of any such performance by Lessor shall be due and payable by

Lessee to Lessor upon invoice therefor. If any check given to Lessor by Lessee

shall not be honored by the bank upon which it is drawn, Lessor, at its own

option, may require all future payments to be made under this Lease by Lessee to

be made only by cashier's check. In the event of a Breach of this Lease by

Lessee (as defined in Paragraph 13.1), with or without further notice or demand,

and without limiting Lessor in the exercise of any right or remedy which Lessor

may have by reason of such Breach, Lessor may:

(a) Terminate Lessee's right to possession of the Premises by any

lawful means, In which case this Lease and the term hereof shall terminate and

Lessee shall immediately surrender possession of the Premises to Lessor. In such

event Lessor shall be entitled to recover from Lessee: (i) the worth at the time

of the award of the unpaid rent which had been earned al the time of

termination; (ii) the worth at the time of award of the amount by which the

unpaid rent which would have bean earned after termination until the time of

award exceeds the amount of such rental loss that the Lessee proves could have

been reasonably avoided; (iii) the worth at the time of award of the amount by

which the unpaid rent for the balance of the term after the time of award

exceeds the amount of such rental loss that the Lessee proves could be

reasonably avoided; and (iv) any other amount necessary to compensate Lessor for

all the detriment proximately caused by the Lessee's failure to perform Its

obligations under this Lease or which in the ordinary course of things would be

likely to result therefrom, including but not limited to the cost of recovering

possession of the Premises, expenses of reletting, including necessary

renovation and alteration of the Premises, reasonable attorneys' fees, and that

portion of any leasing commission paid by Lessor In connection with this Lease

applicable to the unexpired term of this Lease. The worth at the time of award

of the amount referred to in provision (iii) of the immediately preceding

sentence shall be computed by discounting such amount at the discount rate of

the Federal Reserve Bank of San Francisco or the Federal Reserve Bank District

in which the Premises are located at the time of award plus one percent (1%).

Efforts by Lessor to mitigate damages caused by Lessee's Default or Breach of

this Lease shall not waive Lessor's right to recover damages under this

Paragraph 13.2. If termination of this Lease is obtained through the provisional

remedy of unlawful detainer, Lessor shall have the right to recover in such

proceeding the unpaid rent and damages as are recoverable therein, or Lessor may

reserve the right to recover all or any part thereof in a separate suit for such

rer and/or damages. If a notice and grace period required under Subparagraph

13.1(b), (c) or,(d) was not previously given, a notice to pay rent or quit, or

to perform o quit, as the case may be, given to Lessee under any statute

authorizing the forfeiture of lessee for unlawful detainer shall also constitute

the applicable notice to grace period purposes required by Subparagraph

13.1(b),(c) or (d). In such case, the applicable grace period under the unlawful

detainer statue shall run concur xxxxx after the ode such statutory notice, and

the failure of Lessee to cure the Default within the greater of the two (2) such

grace periods shall constitute both at unlawful detainer and a Breach of this

Lease entitling Lessor to the remedies provided for In this Lease and/or by said

statute.

(b) Continue the Lease and Lessee's right to possession In effect

(In California under California Civil Code Section 1951.4 after Lessee's Breach

and recover the rent as it becomes due, provided Lessee has the right to sublet

or assign, subject only to reasonable limitations. Lessor and Lessee agree that

the limitations on assignment and subletting in this Lease are reasonable. Acts

of maintenance or preservation, efforts to relet the Premises, or the

appointment of a receiver to protect the Lessor's Interest under this Lease,

shall not constitute a termination of the Lessee's right to possession.

under the laws or judicial decisions of the state wherein the Premises are

located.

(d) The expiration or termination of this Lease and/or the

termination of Lessee's right to possession shall not relieve Lessee from

Debility under any Indemnity provisions of this Lease as to matters occurring or

accruing during the term hereof or by reason of Lessee's occupancy of the

Premises.

13.3 Inducement Recapture in Event of Breech. Any agreement by Lessor

for free or abated rent or other charges applicable to the Premises, or for the

giving or paying by Lessor to or for Lessee of any cash or other bonus,

Inducement or consideration for Lessee's entering Into this Lease, all of which

concessions are hereinafter referred 10 as "Inducement Provisions" shall be

deemed conditioned upon Lessee's full and faithful performance of all of the

terms, covenants and conditions of this Lease to be performed or observed by

Lessee during the term hereof as the same may be extended. Upon the occurrence

of a Breach (as defined In Paragraph 13.1) of this Lease by Lessee, any such

Inducement Provision shall automatically be deemed deleted from this Lease and

of no further force or effect, and any rent, other charge, bonus, Inducement or

consideration (heretofore abated, given or paid by Lessor under such an

Inducement Provision shall be Immediately due and payable by Lessee to Lessor,

and recoverable by Lessor, as additional rent due under this Lease,

notwithstanding any subsequent cure of said Breach by Lessee. The acceptance by

Lessor of rent or the cure of the Breach which Initialed the operation of this

Paragraph 13.3 shall not be deemed a waiver by Lessor of the provisions of this

Paragraph 13.3 unless specifically so stated In writing by Lessor at the time of

such acceptance.

13.4 Late Charges. Lessee hereby acknowledges that late payment by

Lessee to Lessor of rent and other such due hereunder will cause Lessor to incur

costs not contemplated by this Lease, the exact amount of which will be

extremely difficult to ascertain. Such costs Include, but are not limited to,

processing and accounting charges, end late charges which may be imposed upon

Lessor by the terms of any ground lease, mortgage or deed of trust covering the

Premises. Accordingly, If any Installment of rent or other sum due to Lessee

shall not be received by Lessor or Lessor's designee within ten (10) days after

such amount shall be due, then, without any requirement for notice to Lessee,

Lessee shall pay to Lessor a late charge equal to six percent (6%) ten percent

(10%) of such overdue amount. The parties hereby agree that such late charge

represents a fair and reasonable estimate of the costs Lessor will incur by

reason of late payment by Lessee. Acceptance of such late charge by Lessor shell

In no event constitute a waiver of Lessee's Default or Breach with respect to

such overdue amount, nor prevent Lessor from exercising any of the other rights

and remedies granted hereunder: In the event that a late charge is payable

hereunder, whether or not collected, for three (3) consecutive Installments of

Base Rent, then notwithstanding Paragraph 4.1 or any other provision of this

lease to the contrary, Base Rent shall, at Lessor's option, become due and

payable quarterly In advance.

13.5 Breech by Lessor. Lessor shall not be deemed in breach of this

Lease unless Lessor falls within a reasonable time to perform an obligation

required to be performed by Lessor. For purposes of this Paragraph 13.5, a

reasonable time shall In no event be less than thirty (30) days alter receipt by

Lessor, and by any Lender(s) whose name and address shall have been furnished to

Lessee In writing for such purpose, of written notice specifying wherein such

obligation of Lessor has not been performed; provided, however, that II the

nature of Lessor's obligation Is such that more than thirty (30) days after such

notice are reasonably required for Its performance, then Lessor shall not be In

breech of this Lease if performance Is commenced within such thirty (30) day

period and thereafter diligently pursued to completion.

14. Condemnation. If the Premises or any portion thereof are taken under the

power of eminent domain or sold under the threat of the exercise of said power

(all of which are herein called "condemnation"), this Lease shall terminate as

to the part so taken as of the xxxx the condemning authority lakes title or

possession, whichever first occurs. If more than ten percent (10%) of the floor

area of the Premises, or more than twenty-five percent (25%) of the portion of

the Common Areas designated for Lessee's parking, Is taken by condemnation,

Lessee may, at Lessee's option, to be exercised In writing within ten (10) days

after Lessor shall have given Lessee written notice of such taking (or In the

absence of such notice, within ten (10) days alter the condemning authority

shall have taken possession) terminate this Lease as of the date the condemning

authority lakes such possession. II Lessee does not terminate this Lease In

accordance with the foregoing, this Lease shall remain In full force and effect

as to the portion of the Premises remaining, except that the Base Rent shall be

reduced in the same proportion as the rentable floor area of the Premises taken

bears to the total rentable floor area of the Premises. No reduction of Base

Rent shall occur If the condemnation does not apply to any portion of the

Premises. Any award for the taking of all or any part of the Premises under the

power of eminent domain or any payment made under threat of the exercise of such

power shall be the property of Lessor, whether such award shall be made as

compensation for diminution of value of the leasehold or for the taking of the

xxx, or as severance damages; provided, however, that Lessee shall be entitled

to any compensation, separately awarded to Lessee for Lessee's relocation

expenses and/or loss of Lessee's Trade Fixtures. In the event that this Lease is

not terminated by reason of such condemnation, Lessor shall to the extent of its

net severance damages received, over and above Lessee's Share of the legal and

other expenses incurred by Lessor In the condemnation matter, repair any damage

to the Premises caused by such condemnation authority. Lessee shall be

responsible for the payment of any amount In excess of such net severance

damages required to complete such repair.

15. Brokers' Fees.

15.1 Procuring Cause. The Broker(s) named in Paragraph 1.10 is/are the

procuring cause of this Lease.

15.2 Additional Terms. This paragraph has been stricken from the

document.

15.3 Assumption of Obligations. Any buyer or transferee of Lessor's

Interest In this Lease, whether such transfer is by agreement or by operation of

law, shall be deemed to have assumed Lessor's obligation under this Paragraph

15. Each Broker shall be an Intended third party beneficiary of the provisions

of Paragraph 1.10 and of this Paragraph 15 to the extent of Its Interest In any

commission arising from this Lease and may enforce that right directly against

Lessor and Its successors.

15.4 Representations and Warranties. Lessee and Lessor each represent

and warrant to the other that II has had no dealings with any person, firm,

broker or tinder other than as named In Paragraph 1.10(a) In connection with the

negotiation of this Lease and/or the consummation of the transaction

contemplated hereby, and that no broker or other person, firm or entity other

than said named Broker(s) Is entitled to any commission or finder's fee In

connection with said transaction. Lessee and Lessor do each hereby agree to

Indemnity, protect, defend and hold the other harmless from and against

liability for compensation or charges which may be claimed by any such unnamed

broker, finder or other similar party by reason of any dealings or actions of

the Indemnifying Party, including any costs, expenses, and/or attorneys' lees

reasonably incurred with respect thereto.

16. Tenancy and Financial Statements.

16.1 Tenancy Statement. Each Party (as "Responding Party") shall within

ten (10) days after written notice from the other Party (the "Requesting Party")

execute, acknowledge and deliver to the Requesting Party a statement In writing

In a dorm similar to the Then most current "Tenancy Statement" dorm published by

the American Industrial Real Estate Association, plus such additional

Information, confirmation and/or statements as may be reasonably requested by

the Requesting Party.

16.2 Financial Statement. If Lessor desires to finance, refinance, or

sell the Premises or the Building, or any part thereof, Lessee and all

Guarantors shall deliver to any potential lender or purchaser designated by

Lessor such financial statements of Lessee and such Guarantors as may be

reasonably required by such lender or purchaser, including but not limited to

Lessee's financial statements for the past three (3) years. All such Xxxxxx

statements shall be received by Lessor and such lender or purchaser in

confidence and shall be used only for the purposes herein set forth.

17. Lessor's Liability. The term "Lessor" as used herein shall mean the owner or

owners at the time in question of the fee title to the Premises. In the event of

a transfer of Lessor's title or interest In the Premises or in this Lease,

Lessor shall deliver to the transferee or assignee (In cash or by credit) any

unused Security Deposit held by Lessor at the time of such transfer or

assignment. Except as provided In Paragraph 15.3, upon such transfer or

assignment and delivery of the Security Deposit, as aforesaid, the prior Lessor

shall be relieved of all liability with respect to the obligations and/or

covenants under this Lease thereafter to be performed by the Lessor. Subject to

the foregoing, the obligations and/or covenants in this Lease to be performed by

the Lessor shall be binding only upon the Lessor as hereinabove defined.

18. Severability. The Invalidity of any provision of this Lease, as determined

by a court of competent jurisdiction, shall In no way affect the validity of any

other provision hereof.

19. Interest on Past-Due Obligations. Any monetary payment due Lessor hereunder,

other than late charges, not received by Lessor within ten (10) days following

the date on which II was due, shall bear interest from the date due at the prime

rate charged by the largest slate chartered bank In the slate in which the

Premises are located plus four percent (4%) per annum, but not exceeding the

maximum rate allowed by law, In addition to the potential late charge provided

for In Paragraph 13.4.

20. Time of Essence. Time is of the essence with respect to the performance of

all obligations to be performed or observed by the Parties under this Lease.

21. Rent Defined. All monetary obligations of Lessee to Lessor under the terms

of this Lease are deemed to be rent.

22. No Prior or other Agreements; Broker Disclaimer. This Lease contains all

agreements between the Parties with respect to any matter mentioned herein, and

no other prior or contemporaneous agreement or understanding shall be effective.

Lessor and Lessee each represents and warrants to the Brokers that It has made,

and is relying solely upon, its own investigation as to the nature, quality,

character and financial responsibility of the other Party to this Lease and as

to the' nature, quality and character of the Premises. Brokers have no

responsibility with respect thereto or with respect to any default or breach

hereof by either Party. Each Broker shall be an intended third party beneficiary

of the provisions of this Paragraph 22.

23. Notices.

23.1 Notice Requirements. All notices required or permitted by this

Lease shall be In writing and may be delivered In person (by hand or by

messenger or courier service) or may be sent by regular, certified or registered

mall or U.S. Postal Service Express Mall, with postage prepaid, or by facsimile

transmission during normal business hours, and shall be deemed sufficiently

given II served Ina manner specified In this Paragraph 23. The addresses noted

adjacent to a Party's signature on this Lease shall be that Party's address for

delivery or mailing of nonce purposes. Either Party may by written notice to the

other specify a different address or notice purposes, except that upon Lessee's

taking possession of the Premises, the Premises shall constitute Lessee's

address for the purpose of mailing or delivering notices to Lessee. A copy of

all notices required or permitted to be given to Lessor hereunder shall be

concurrently transmitted to such party or parties at such addresses as Lessor

may from time to time hereafter designate by written nonce to Lessee.

23.2 Date of Notice. Any notice sent by registered or certified mall,

return receipt requested, shall be deemed given on the date of delivery shown on

the receipt card, or If no delivery xxxx Is shown, the postmark thereon. If sent

by regular mall, the nonce shall be deemed given forty-eight (48) hours after

the same is addressed as required herein and mailed with postage prepaid.

Notices delivered by United Stales Express Mail or overnight courier that

guarantees next day delivery shall be deemed given twenty-four (24) hours alter

delivery of the same to the United Slates Postal Service or courier. If any

notice is transmitted by facsimile transmission or similar means, the same shall

be deemed served or delivered upon telephone or facsimile confirmation of

receipt of the transmission thereof, provided a copy Is also delivered via

delivery or mail. If notice is received on a Saturday or a Sunday or a legal

holiday, II shall be deemed received on the next business day.

24. Waivers. No waiver by Lessor of the Default or Breach of any term, covenant

or condition hereof by Lessee, shall be deemed a waiver or any other term,

covenant or condition hereof, or of any subsequent Default or Breach by Lessee

of the same or any other term, covenant or condition hereof. Lessor's consent

to, or approval of, any such act shall not be deemed to render unnecessary the

obtaining of Lessor's consent to, or approval of, any subsequent or similar act

by Lessee, or be construed as the basis of an estoppel to enforce the provision

or provisions of this Lease requiring such consent. Regardless of Lessor's

knowledge of a Default or Breach al the time of accepting rent, the acceptance

of rent by Lessor shall not be a waiver of any Default or Breach by Lessee of

any provision hereof. Any payment given Lessor by Lessee may be accepted by

Lessor on account of moneys or damages due Lessor, notwithstanding any

qualifying statements or conditions made by Lessee In connection herewith, which

such statements and/or conditions shall be of no force or effect whatsoever

unless specifically agreed to in writing by Lessor at or before the time of

deposit of such payment.

25. Recording. This paragraph has been stricken from the document.

26. No Right to Holdover. Lessee has no right to retain possession of the

Premises or any part thereof beyond the expiration or earlier termination of

this Lease. In the event that Lessee holds over in violation of this Paragraph

26 then the Base Rent payable from and after the time of the expiration or

earlier termination of this Lease shall be increased to two hundred percent

(200%) of the Base Rent applicable during the month Immediately preceding such

expiration or earlier termination. Nothing contained herein shall be construed

as a consent by Lessor to any holding over by Lessee.

27. Cumulative Remedies. No remedy or election hereunder shall be deemed

exclusive but shall, wherever possible, be cumulative with all other remedies al

law or in equity.

28. Covenants and Conditions. All provisions of this Lease to be observed or

performed by Lessee are both covenants and conditions.

29. Binding Effect; Choice at Law. This Lease shell be binding upon the Parties,

their personal representatives, successors and assigns and be governed by the

laws of the State In which the Premises are located. Any litigation between the

Parties hereto concerning This Lease shall be Initialed In the county in which

the Premises are located.

30. Subordination; Attornment; Non-Disturbance.

30.1 Subordination. This Lease and any Option granted hereby shall be

subject and subordinate to any ground lease, mortgage, deed' of trust, or other

hypothecation or security device (collectively, "Security Device"), now or

hereafter placed by Lessor upon the real properly of which the Premises are a

part, lo any and all advances made on the security thereof, and to all renewals,

modifications, consolidations, replacements and extensions thereof. Lessee

agrees that the Lenders holding any such Security Device shall have no duty,

liability or obligation to perform any of the obligations of Lessor under this

Lease, but that In the event of Lessor's default with respect to any such

obligation, Lessee will give any Lender whose name and address have been

furnished Lessee in writing for such purpose nonce of Lessor's default pursuant

to Paragraph 13.5.1f any Lender shall elect to have this Lease and/or any Option

granted hereby superior to the lien of Its Security Device and shall give

written notice thereof to Lessee, this Lease and such Options shall be deemed

prior to such Security Device, notwithstanding the relative xxxxx xx the

documentation or recordation thereof,

30.2 Attornment. Subject 10 the non-disturbance provisions of Paragraph

30.3, Lessee agrees to attorn to a Lender or any other party who acquires

ownership of the Premises by reason of a foreclosure of a Security Device, and

that in the event of such foreclosure, such new owner shall not: (i) be liable

for any act or omission of any prior Lessor or with respect to events occurring

prior to acquisition of ownership, (ii) be subject to any offsets or defenses

which Lessee might have against any prior Lessor, or (iii) be bound by

prepayment of more than one month's rent.

30.3 Non-Disturbance. With respect to Security Devices entered into by

Lessor after the execution of this lease, Lessee's subordination of this Lease

shall be subject to receiving assurance (a "non-disturbance agreement") from the

Lender that Lessee's possession and this Lease, Including any options to extend

the term hereof, will not be disturbed so long as Lessee Is not In Breech hereof

and adorns to the record owner of the Premises.

30.4 Self-Executing. The agreements contained In this Paragraph 30

shall be effective without the execution of any further documents; provided,

however, that upon written request from Lessor or a Lender In connection with a

sale, financing or refinancing of Premises, Lessee and Lessor shall execute such

further writings as may be reasonably required to separately document any such

subordination or non-subordination, attornment and/or non-disturbance agreement

as is provided for herein.

31. Attorneys' Fees. If any Party or Broker brings an action or proceeding to

enforce the terms hereof or declare rights hereunder, the Prevailing Party (as

hereafter defined) in any such proceeding, action, or appeal thereon, shall be

entitled to reasonable attorneys' lees. Such lees may be awarded in the same

suit or recovered in a separate suit, whether or not such action or proceeding

Is pursued to decision or judgment. The term "Prevailing Party" shall Include,

without limitation, a Party or Broker who substantially obtains or defeats the

revel sought, as the case may be, whether by compromise, settlement, judgment,

or the abandonment by the other Party or Broker of its claim or defense. The

attorneys' fee award shall not be computed in accordance with any court xxx

schedule, but shall be such as to fully reimburse all attorneys' lees reasonably

Incurred. Lessor shall be entitled to attorneys' lees, costs and expenses

incurred in preparation and service of notices of Default and consultations in

connection therewith, whether or not a legal action is subsequently commenced In

connection with such Default or resulting Breach. Broker(s) shall be Intended

third party beneficiaries of this Paragraph 31.

32. Lessor's Access; Showing Premises; Repairs. Lessor and Lessor's agents shall

have the right to enter the Premises at any time, in the case of an emergency,

and otherwise at reasonable times mar the purpose of showing the same to

prospective purchasers, lenders, or lessees, and making such alterations,

repairs, Improvements or additions to the Premises or to the Building, as Lessor

may reasonably deem necessary. Lessor may al any time place on or about the

Premises or Building any ordinary "For Sale" signs and Lessor may at any time

during the last one hundred eighty (180) days of the term hereof place on or

about the Premises any ordinary "For Lease" signs. All such activities of Lessor

shall be without abatement of rent or liability to Lessee.

33. This paragraph has been stricken from the document.

34. Signs. Lessee shall not place any sign upon the exterior of the Premises of

the building, without Lessor's prior written consent. (See Addendum) Part of

this paragraph has been stricken from the document.

35. Termination; Merger. Unless specifically stated otherwise in writing by

Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual

termination or cancellation hereof, or a termination hereof by Lessor or Breach

by Lessee, shall automatically terminate any sublease or lesser estate in the

Premises; provided, however, Lessor shall, In the event of any such surrender,

termination or cancellation, have the option to continue any one or all of any

existing subtenancies. Lessor's failure within ten (10) days following any such

event to make a written election to the contrary by written notice to the holder

of any such lesser interest, shall constitute Lessor's election to have such

event constitute the termination of such interest.

36. Consents.

(a) Except for Paragraph 33 hereof (Auctions) or as otherwise

provided herein, wherever In this Lease the consent of a Party is required to an

act by or tor the other Party, such consent shall not be unreasonably withheld

or delayed. Lessor's actual reasonable costs and expenses (including but not

limited to architects', attorneys', engineers' and other consultants' lees)

Incurred In the consideration of, or response lo, a request by Lessee for any

Lessor consent pertaining to this Lease or the Premises, Including but not

limned to consents to an assignment a subletting or the presence or use of a

Hazardous Substance, shall be paid by Lessee to Lessor upon receipt of an

Invoice and supporting documentation therefor. In addition to the deposit

described in Paragraph 12.2(5), Lessor may, as a condition to considering any

such request by Lessee, require that Lessee deposit with Lessor an amount of

money (In addition to the Security Deposit held under Paragraph 5) reasonably

calculated by Lessor is represent the cost Lessor will Incur in considering and

responding to Lessee's request. Any unused portion of said deposit shall be

refunded to Lessee without Interest. Lessor's consent to any act, assignment of

this Lease or subletting of the Premises by Lessee shall not constitute an

acknowledgment that no Default or Breach by Lessee of this Lease exists, nor

shall such consent be deemed a waiver of any than existing Default or Breach,

except as may be otherwise specifically sealed In writing by Lessor at the time

of such consent.

(b) All conditions to Lessor's consent authorized by this Lease

are acknowledged by Lessee as being reasonable. The failure to specify herein

any particular condition to Lessor's consent shall not preclude the Impositions

by Lessor al the time of consent of such further or other conditions as are then

reasonable with reference to the particular matter for which consent is being

given.

37. Guarantor.

37.1 Form of Guaranty. If there are to be any Guarantors of this Lease

per Paragraph 1.11, the form of the guaranty 10 be executed by each such

Guarantor shall be in the form most recently published by the American

Industrial Real Estate Association, and each such Guarantor shall have the same

obligations as Lessee under this lease, Including but not limited to the

obligation 10 provide the Tenancy Statement and Information required in

Paragraph 16.

37.2 Additional Obligations of Guarantor. It shall constitute a Default

of the Lessee under this Lease if any such Guarantor falls or refuses, upon

reasonable request by Lessor to give: (a) evidence of the due execution of the

guaranty called for by this Lease, Including the authority of the Guarantor (and

of the party signing on Guarantor's behalf) to obligate such Guarantor on said

guaranty, and resolution of its board of directors authorizing the making of

such guaranty, together with a certificate of Incumbency showing the signatures

of the persona authorized to sign on Its behalf, (b) current financial

statements of Guarantor as may from time to time be requested by Lessor, (c) a

Tenancy Statement, or (d) written confirmation that the guaranty is still in

effect

38. Quiet Possession. Upon payment by Lessee of the rent for the Premises and

the performance of all of the covenants, conditions and provisions on Lessee's

part to be observed and performed under this Lease, Lessee shall have quiet

possession of the premises for the entire term hereof subject to all of the

provisions of this Lease.

39. Options.

39.1 Definition. As used in this Lease, the word "Option" has the

following meaning: (a) the right to extend the term of this Lease or to renew

this Lease on terms which may be mutually agreeable at prevailing market rates.

Part of this paragraph has been stricken from the document.

39.2 Options Personal to Original Lessee. Each Option granted to Lessee

in this Lease Is personal to the original Lessee named In Paragraph 1.1 hereof,

and cannot be voluntarily or Involuntarily assigned or exercised by any person

or entity other than said original Lessee while the original Lessee is in full

and actual possession of the Premises and without the intention of thereafter

assigning or subletting. The Options, if any, herein granted to Lessee are not

assignable, either as a pan of an assignment of this Lease or separately or

apart therefrom, and no Option may be separated from this Lease In any manner,

by reservation or otherwise.

39.3 Multiple Options. In the event that Lessee has any multiple

Options to extend or renew this Lease, a later option cannot be exercised unless

the prior Options to extend or renew this Lease have been validly exercised.

39.4 Enact of Default on Options.

(a) Lessee shall have no right to exercise an Option,

notwithstanding any provision in the grant of Option to the contrary: (i) during

the period commencing with the giving of any notice of Default under Paragraph

13.1 and continuing until the noticed Default Is cured, or (ii) during the

period of time any monetary obligation due Lessor from Lessee Is unpaid (without

regard to whether notice thereof Is given Lessee), or (iii) during the time

Lessee is in Breach of this Lease, or (iv) In the event that Lessor has given to

Lessee three (3) or more notices of separate Defaults under Paragraph 13.1

during the twelve (12) month period Immediately preceding the exercise of the

Option, whether or not the Defaults are cured.,

(b) The period of time within which an Option may be exercised

shall not be extended or enlarged by reason of Lessee's inability to exercise an

Option because of the provisions of Paragraph 39.4(a).

terminate and be of no further force or affect, notwithstanding Lessee's due and

timely exercise of the Option, if, after such exercise and during the term of

this Lease, (i) Lessee falls to pay to Lessor a monetary obligation of Lessee

for a period of thirty (30) days after such obligation becomes due (without any

necessity of Lessor to give notice thereof to Lessee), or (ii) Lessor gives to

Lessee three (3) or more notices of separate Defaults under Paragraph 13.1

during any twelve (12) month period, whether or not the Defaults are cured, or

(iii) If Lessee commits a Breach of this Lease.

40. Rules and Regulations. Lessee agrees that it will abide by, and keep and

observe all reasonable rules and regulations ("Rules and Regulations") which

Lessor may make from Ume to time for the management, safely, care, and

cleanliness of the grounds, the parking and unloading of vehicles and the

preservation of good order, as well as for the convenience of other occupants or

tenants of the Building and the Industrial Center and their invitees.

41. Security Measures. Lessee hereby acknowledges that the rental payable to

Lessor hereunder does not include the cost of guard service or other security

measures, and that Lessor shall have no obligation whatsoever to provide same.

Lessee assumes all responsibility for the protection of the Premises, Lessee,

Its agents and Invitees and their property from the acts of third parties.

42. Reservations. Lessor reserves the right, from time to time, to grant,

without the consent or joinder of Lessee, such easements, rights of way, utility

raceways, and dedications that Lessor deems necessary, and to cause the

recordation of parcel maps and restrictions, so long as such easements, rights

of way, utility raceways, dedications, maps and restrictions do not reasonably

Interfere with the use of the Premises by Lessee. Lessee agrees to sign any

documents reasonably requested by Lessor to effectuate any such easement rights,

dedication, map or restrictions.

43. Performance Under Protest. If at any time a dispute shall arise as to any

amount or sum of money to be paid by one Party to the other under the provisions

hereof, the Party against whom the obligation la pay the money Is asserted shall

have the right to make payment "under protest" and such payment shall not be

regarded as a voluntary payment and there shall survive the right on the part of

said Party to Institute suit for recovery o1 such sum. If It shall be adjudged

that there was no legal obligation on the part of said Party to pay such sum or

any part thereof, said Party shall be entitled to recover such sum or so much

thereof as It was not legally required to pay under the provisions of this

Lease.

44. Authority. If either Party hereto Is a corporation, trust, or general or

limited partnership, each Individual executing this Lease on behalf of such

entity represents and warrants that ha or she Is duly authorized to execute and

deliver this Lease on Its behalf. If Lessee Is a corporation, trust or

partnership, Lessee shall, within thirty (30) days after request by Lessor,

deliver to Lessor evidence satisfactory to Lessor of such authority.

45. Conflict. Any conflict between the printed provisions of this Lease and the

typewritten or handwritten provisions shall be controlled by the typewritten or

handwritten provisions.

46. Otter. Preparation of this Lease by either Lessor or Lessee or Lessor's

agent or Lessee's agent and submission of same to Lessee or Lessor shall not be

deemed an oiler to lease. This Lease Is not intended to be binding until

executed and delivered by all Parties hereto.

47. Amendments. This Lease may be modified only in writing, signed by the

parties In Interest at the Urns of the modification. The Parties shall amend

this Lease from time to time to reflect any adjustments that are made to the

Base Rent or other rent payable under this Lease. As long as they do not

materially change Lessee's obligations hereunder, Lessee agrees to make such

reasonable non-monetary modifications to this Lease as may be reasonably

required by an Institutional Insurance company or pension plan Lender In

connection with the obtaining of normal financing or refinancing of the property

of which the Premises are a part.

48. Multiple Parties. Except as otherwise expressly provided herein, If more

than one person or entity Is named herein as either Lessor or Lessee, the

obligations of such multiple parties shall be the joint and several

responsibility of all persons or entitles named herein as such Lessor or Lessee.

EXHIBIT "A" -- SITE PLAN

EXHIBIT "B" -- FLOOR PLAN

EXHIBIT "C" -- CREDIT LETTER

RECORDING OF THIS

LEASE PROHIBITED

LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND

PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR

INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE

TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE

AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE

PREMISES.

IF THIS LEASE HAS BEEN FILLED IN, IT HAS BEEN PREPARED FOR YOUR

ATTORNEY'S REVIEW AND APPROVAL FURTHER, EXPERTS SHOULD BE CONSULTED TO

EVALUATE THE CONDITION OF THE PROPERTY FOR THE POSSIBLE PRESENCE OF

ASBESTOS, UNDERGROUND STORAGE TANKS OR HAZARDOUS SUBSTANCES. NO

REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN INDUSTRIAL

REAL ESTATE ASSOCIATION OR BY THE REAL ESTATE BROKERS OR THEIR

CONTRACTORS, AGENTS OR EMPLOYEES AS TO THE LEGAL SUFFICIENCY, LEGAL

EFFECT, OR TAX CONSEo QUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH

IT RELATES; THE PARTIES SHALL RELY SOLELY UPON THE ADVICE OF THEIR OWN

COUNSEL AS TO THE LEGAL AND TM CONSEQUENCES OF THIS LEASE. IF THE

SUBJECT PROPERTY IS IN A STATE OTHER THAN CALIFORNIA, AN ATTORNEY FROM

THE STATE WHERE THE PROPERTY IS LOCATED SHOULD BE CONSULTED.

The parties hereto have executed this Lease at the place and on the dales

specified above their respective signatures.

Executed at: FULLERTON BUSINESS CENTER Executed at:

on: on:

----------------------------------- -------------------------------

By LESSOR: FULLERTON BUSINESS CENTER By LESSEE: ALLIED MED, INC.,

By: ALEXICO, INC., a California Corporation AN OREGON CORPORATION

------------------------------------------------------- ----------------------------------------

dba MID VALLEY MANAGEMENT, Managing Agent

By: /s/ By: /s/

---------------------------------------- ------------------------------------

Name Printed:Xxxx Xxxx

------------------------------------

Title: President

------------------------------

Name Printed: XXXXX XXXXXXX Name Printed: XXXX XXXX

---------------------------------------- ------------------------------------

Title: AUTHORIZED AGENT Title: VICE PRESIDENT

---------------------------------------- ------------------------------------

NOTE: These forms are often modified to meet changing requirements of law and

needs of the industry. Always write or call to make sure you are

utilizing the most current form: AMERICAN INDUSTRIAL REAL ESTATE

ASSOCIATION, 340 Xx. Xxxxxxxx Xx., X-0, Xxx Xxxxxxx, XX 00000 (213)

687-8777.

ADDENDUM I

--------------------

THIS ADDENDUM is attached to and integrated as a part of that certain

Lease dated SEPTEMBER 23, 2005, by and between FULLERTON BUSINESS CENTER,

Lessor, and ALLIED MED, INC., AN OREGON CORPORATION, Lessee, and constitutes

additional Covenants, Conditions and Agreements contained herein, which Addendum

shall prevail in the event of any conflict between the Covenants, Conditions and

Agreements contained herein and those in said Lease.

REFURBISHING FEE AND KEY DEPOSIT

1. Lessee agrees to pay to Lessor a non-refundable refurbishing fee of $ WAIVED

and a key deposit of $ WAIVED.

ACCEPTANCE OF LEASED PREMISES

2. Lessee accepts the Premises (as well as the improvements thereon and the

facilities appurtenant thereto) in their present conditions, and acknowledges

that the Premises (as well as the improvements thereon and the facilities

appurtenant thereto) are in good, clean, safe and tenantable condition as of the

date of this Lease. Lessee further represents to Lessor that the Premises have

been inspected by Lessee, and that he/she has been assured by means independent

of Lessor, or any Agent of Lessor, regarding truth of all facts material to the

Lease, and that the Premises are being Leased by the Lessee as a result of

his/her inspection and investigation and not as a result of any representations

by Lessor or any Agent of Lessor. Lessee shall complete and return the "Unit

Inspection Checklist" within 30 days of the lease commencement, and those items

not corrected by Lessor will be excluded from Lessee's obligation to restore the

Premises upon surrender. Lessee's failure to return the "Unit Inspection

Check-List" constitutes a waiver of all rights thereto.

RENT ESCALATIONS

3. Lessee agrees to pay to Lessor in advance, at such places as may be

designated from time to time by Lessor, without deduction or offset, and Lessor

agrees to accept as Rent for the Leased Premises, the following monthly Rental

Payment Schedule for the term of the Lease:

OCTOBER 1, 2005 THROUGH SEPTEMBER 30, 2006 $2,534.00 PER MONTH

ADDRESS FOR RENT PAYMENTS

4 Lessee's payments of rent and other amounts due, shall be considered to have

been received by Lessor only when received by mail at Mid Valley Management,

P.O. Box 514779, Los Angeles, CA 90051-4779. Rental payments will not be

accepted at any of Lessor's Leasing Offices.

LATE CHARGES AND RETURNED CHECKS

5. Rent is due on the first of the month. If not received by the tenth of the

month, a ten percent (10%) late charge on each delinquent payment will be added.

A ten percent (10%) late charge will be added on all checks returned unpaid by

the bank. If more than two (2) checks are returned, Lessee must thereafter pay

by cashier's check and Lessor shall have as an additional remedy the right to

terminate the Lease.

Page 1 of 7

PARKING RULES AND REGULATIONS

PERMITTED AND PROHIBITED PARKING

6. Parking is permitted in designated striped areas only. All other Vehicles not

parked in such areas are subject to being towed away at Lessee's expense (22658

CVC). Parking is prohibited:

(a) in areas not striped for parking;

(b) in aisles;

(d) where "Handicap" signs are posted, unless Handicap I.D. is posted

in or on vehicle;

(e) on ramps;

(f) in areas outside warehouse doors which are restricted to loading

and unloading only; this is a fire lane and must not be blocked;

(g) in specifically assigned and reserved spaces to others than

Lessee; and (h) in such other areas as may be designated by

Lessor, its Agents, Lessee or Licensee.

OVERNIGHT STORAGE OF VEHICLES OR TRAILERS

7. There will be no overnight storage of Vehicles or Trailers in the parking

lot. Vehicles used and moved on a daily basis are exempt.

DAMAGED VEHICLES

8. There will be no storage of wrecked or damaged Vehicles at any time.

DIRECTIONAL SIGNS AND ARROWS

9. All directional signs and arrows must be observed.

SPEED LIMIT

10. The speed limit shall be five (5) miles per hour.

RESPONSIBILITY FOR LOCKED VEHICLES AND DAMAGES

11. Every Lessee is requested to park and lock his/her own Vehicle. All

responsibility for damage to Vehicles to be repaired is assumed by Authorized

Users. Lessee shall repair or cause to be repaired at its sole cost and expense

any and all damage to the Business Complex Parking Facility or any part thereof

caused by Lessee, its Authorized Users, Invitees or Guests, or resulting from

Vehicles of each of them. Lessee specifically waives any claims against Lessor

arising out of damage to said Vehicles.

COMMON AREA PARKING

12. Lessee shall be entitled to park in common with other Tenants of Lessor in

the parking area for the specific use as described in the Leasehold. Lessee

specifically waives any claims against Lessor arising out of damage to said

Vehicles. Lessee agrees not to overburden the parking facilities and agrees to

cooperate with Lessor and other Tenants in the use of parking facilities. Lessor

reserves the right in its absolute discretion to determine whether parking

facilities are becoming crowded, and in such an event, to allocate parking

spaces among Lessee and other Tenants. In the event Lessor deems allocation

necessary, Lessee shall be entitled to the use of no more than FIVE (5) parking

spaces. Lessee hereby agrees not to occupy or permit its Employees, Customers or

Invitees to occupy more than the number of spaces specified above; nor to park

anywhere other than in parking stalls assigned and designated as such by painted

signs, parking lines and parking bumpers.

Page 2 of 7

MAINTENANCE

13. Pursuant to Paragraph 7.1 of the Lease Agreement, the cost to be charged

hereunder shall include an additional administrative cost of twenty-five percent

(25%) as additional rent to be paid by Lessee with the next rental payment.

In addition to the Lease Agreement, upon termination of Lessee's

tenancy, all keys shall be delivered to Lessor and any and all Personal Property

left in the Premises at said termination shall become the Property of Lessor.

Lessor shall have the right to dispose of the Property in any manner which at

its sole election it claims appropriate. Lessee waives, releases and forever

discharges Lessor from any and all claims, liability and expense with respect to

such Personal Property, including the right to account for any proceeds of sale.

TENANT ALTERATIONS

14. Lessor may withhold the approval of any alteration, addition, or improvement

that requires work which does not comply with any applicable laws (including,

without limitation, the Americans with Disabilities Act of 1990 and all

regulations issued thereunder) or requires other alterations, additions, or

improvements of the Premises or common areas of the Business Complex, in order

to comply with applicable laws.

14.1 Lessee is not permitted to wallpaper or paint within Premises

without Lessor's express written permission. If permission is granted by Lessor,

Lessee is required to restore the wall surface areas, with like materials, to

the same condition as they were prior to the execution of this Lease.

14.2 At the expiration of this lease term or at the time Lessee vacates

the premises, if the entire floor surface area of the leased premises requires

more than a damp mopping, Lessee agrees, as a condition of this Lease, to pay in

full any and all costs incurred in returning the floor surface areas to the same

condition as it was prior to the execution of this Lease. In the event Lessee

uses any chemical substances, including, but not limited to the following:

grease, paint, oil, ink, dye, solvents or other liquid base material, Lessee

shall bear the responsibility to return the leased premises to the same

condition as it was prior to the execution of this Lease.

ROOF ACCESS

15. Neither Lessee, Lessee's Agent, Contractors, Employees or invitees shall

enter upon the roof of the Premises (except in the case of an emergency) for any

purpose whatsoever without first receiving Lessor's written consent which shall

not be unreasonably withheld.

15.1 If the Lessee, Lessee's Agents, Contractors, Employees or invitees

shall enter upon the roof of said Premises, whether with or without the consent

of Lessor, then the Lessee specifically indemnifies and agrees to hold Lessor

harmless from any and all claims, actions or causes of action resulting from

injuries incurred to any of said individuals or any other Person or Property,

caused by or as a result of their entering upon the roof of said Premises,

15.2 In the event that Lessor grants written permission to the Lessee

or any of the persons set forth above to have roof access, said consent shall be

expressly on the condition that each time said Lessee or those persons

designated by Lessee to enter upon the roof that they first execute a written

Letter of Agreement provided by Lessor (a) expressly indemnifying and holding

Lessor free and harmless from any and all damages caused by said individuals to

the Leasehold Premises, (b) indemnifying Lessors from any personal injury

damages caused in connection therewith, (c) provide Lessor with a $200.00

deposit or such other sum as Lessor may hereinafter set for every penetration

upon the roof with the express authorization to permit Lessor to seal around all

roof cuts and to charge the deposit for the actual cost thereof and with the

express understanding that at such time as the Lessee vacates the subject

Premises, that all equipment installed thereon by Lessee shall be removed

(unless there is an Agreement in writing by and between Lessor and Lessee to the

contrary), Lessor's Roofer shall be responsible for making any and all roof

repairs required by said removal and Lessee shall be responsible for all charges

incurred in connection therewith. Lessor shall have the express authorization to

charge Lessee's deposit for all costs in connection therewith and (d) at

Lessor's election, secure a Performance and Material and Labor Bond from

Contractor in the amount of one and one-half times the cost of said improvement;

making the Lessor an additional insured and beneficiary.

Page 3 of 7

15.3 Lessee shall be required to submit reasonably detailed final

plans, specifications and working drawings of the proposed alteration or

alterations and the name of its Contractor at least thirty (30) days before the

date it intends to commence the alterations. Drawings shall include, but not be

limited to, the disclosure of the size, weight and type of installation to be

placed upon the roof.

15.4 Lessee's Contractor shall provide Lessor with Certificates of

Insurance and at the election of Lessor, name the Lessee as an additional

insured.

WORK AREAS

16. Lessee shall not be permitted to work in the parking lot or loading door

areas. All work must be confined within the Leased Premises.

PROTECTION OF PREMISES

17. Lessee assumes any and all responsibility for protecting its Premises from

theft, robbery, vandalism and pilferage. Lessor strongly suggests that Lessee

re-key the unit upon taking possession, which cost is at Lessee's sole cost and

expense.

LESSEE'S ALARM SYSTEM

18. If Lessee desires to install an alarm system, all equipment must be

installed inside Lessee's unit so as not to be visible and shall otherwise

comply to the standards set by Lessor for all alarm systems contained in the

Business Complex. All alarm systems must be approved by Lessor. When equipment

is removed, the Premises must be restored to its original condition by Lessee.

Only one alarm sticker per unit placed on Lessee's door is permitted, with the

exception that corner units may also have a second sticker on the bottom of the

side glass window.

RUBBISH REMOVAL

19. No rubbish, containers or debris are to be left outside of Lessee's unit.

All refuse is to be placed in designated trash bins. Any debris is subject to

immediate removal by Lessor at Lessee's expense. This rule applies to pallets as

well. Lessee shall not place in any trash box or receptacle any material which

cannot be disposed of in the ordinary and customary manner of trash and garbage

disposal. All garbage and refuse disposal shall be made in accordance with

directions issued from time to time by Lessor. Lessee shall reimburse Lessor,

upon demand, for trash removal service to the Business Complex allocated to the

Premises by Lessor on a prorata basis. If Lessor shall determine that the trash

generated by or at the Premises, in Lessor's reasonable estimation, shall be

excessive, Lessee shall pay to Lessor, upon demand, such additional charges as

Lessor shall equitably impose for such excess trash removal. Lessor shall have

the option to contract for a single trash removal service for the entire

Business Complex.

EXTERIOR DAMAGE BY LESSEE

During the Lease Term, and at expiration (or early termination) of this

Lease, if Lessee dirties, soils or damages the exterior of Lessor's Business

Complex, Lessee will be responsible for the repair of this damage. If Lessee

fails to repair the damage which Lessee causes within five (5) days of such

occurrence, then Lessor may make such repairs and xxxx Lessee for the cost of

such repair plus an administrative cost of an additional twenty-five percent

(25%).

Page 4 of 7

SIGNAGE

21. Lessee shall not place or permit to be placed any projecting sign, marquee,

decoration or awning on said Premises without the written consent of Lessor;

which consent shall not be unreasonably withheld. All signs which are permitted

shall be conforming to the signage criteria established from time to time by

Lessor for the Premises, Building and the Business Complex, as applicable, and

shall be maintained by Lessee at its sole expense, including, but not limited to

sign fabrication, maintenance, operation (including any required utilities),

repair and removal. Lessee, upon the request of Lessor, shall immediately remove

any sign or decoration which Lessee has placed, or permitted to be placed in, on

or about the Premises of which, in the sole option and discretion of Lessor, is

objectionable or offensive; and if Lessee fails to do so, Lessor may enter upon

said Premises and remove said item and charge the cost thereof to Lessee. Lessee

shall not place or permit to be placed upon any side wall, rear wall, window or

roof; any sign, advertisement or notice without the written consent of Lessor,

which consent shall only be given where the proposed sign, advertisement or

notice complies with the specifications of size, shape, design, color or

material established by Lessor and which are applicable to all Tenants of

Lessor's Business Complex.

WINDOWS AND WINDOW COVERINGS

22. Lessee shall not place any window coverings upon the Leasehold Premises

(e.g. curtains, draperies, blinds, etc.) without Lessor's written consent, which

consent shall not be unreasonably withheld, and provided the proposed window

covering complies with the specifications established by Lessor and which are

applicable to all Tenants of Lessor in the Business Complex. Lessee shall keep

the glass windows free of dirt and stains and shall clean windows on a frequent

and regular basis.

AUCTION ON PREMISES

23. Lessee shall not conduct or permit to be conducted any sale by auction or

liquidation (going out of business sale) on said Premises.

CANVASSING AND SOLICITATION

24. Canvassing, soliciting and distribution of handbills or other written

material and peddling in the Business Complex is prohibited; each Tenant shall

cooperate to prevent same.

FOUL, NOXIOUS GAS OR SUBSTANCE AND ANIMALS

25. Lessee shall not use, or permit to be used in the Premises, any foul,

noxious gas or substance; or permit or allow the Premises to be occupied or used

in a manner offensive or objectionable to Lessor or other occupants of the

Building by reason of noise, odors or vibrations; nor shall Lessee bring into or

keep in or about the Premises any birds or animals (except seeing eye dogs when

accompanied by their masters).

UNDER THE INFLUENCE

26. Lessor reserves the right to exclude or expel from the Premises any person

who, in Lessor's judgment, is intoxicated or under the influence of liquor,

drugs or other abusive substances, or who is otherwise in violation of any Rules

and Regulations of the Business Complex.

NAME AND ADDRESS OF PREMISES

Lessor reserves the right, exercisable with sixty (60) days notice and

without liability to Lessee, to change the name and address of the Premises.

Said sixty (60) days notice shall conclusively be deemed reasonable notice to

Lessee.

Page 5 of 7

RELOCATION RIGHT

28. Lessor may, upon not less than sixty (60) days prior written notice to

Lessee, substitute for the Premises, reasonably similar space elsewhere in the

Business Complex, and this Lease shall be deemed modified so as to eliminate the

Premises hereby leased and to substitute therefor such other premises (and the

rentable and usable areas thereof). In such event, in all other respects, this

Lease shall remain in full force and effect according to its terms. In

connection therewith, the costs of preparing such other premises for Tenant's

use, together with Tenant's reasonable costs of moving, shall be borne by

Lessor.

NO PERSONAL OBLIGATION

29. Lessee agrees to look solely to any equity interest of Lessor in and to the

Premises for satisfaction of any liability Lessor may have to Lessee under this

Lease and not to any other assets of Lessor or the personal assets of any

constituent general or limited partner, shareholder, director, officer, employee

or member of Lessor or of any general or limited partnership, corporation,

limited liability company or other entity of which Lessor is formed.

NON-DISCRIMINATION AND NON-SEGREGATION COVENANT

30. Lessee herein covenants by and for himself or herself, his or her heirs,

executors, administrators, assigns, and for all persons claiming under or

through him or her. This Lease is made and accepted upon and subject to the

following conditions:

That there shall be no discrimination against or segregation of any

person or group of persons on account of race, color, creed, religion, sex,

marital status, national origin or ancestry, in the Leasing, Subleasing,

transferring, use, occupancy, tenure and enjoyment of the Premises herein

Leased; nor shall Lessee himself, or any person claiming under or through him or

her, establish or permit any such practice or practices of discrimination and/or

segregation with reference to the selection, location number, use and occupancy

of Lessees, Tenants, Sublessees, Subtenants, Assignees and/or Vendees in the

Premises herein Leased.

CHANGES IN RULES AND REGULATIONS

31. Lessor reserves the right by written notice to Lessee to rescind, alter or

waive any Rule or Regulation prescribed for Lessor's Business Complex at any

time when, in Lessor's judgment, it is necessary, desirable, proper and in the

best interest of Lessor's Business Complex and its Tenants. Lessee agrees to be

bound by any changes, revisions or modifications.

Lessor further reserves the right to make such other Rules and

Regulations as in its judgment may be necessary for the safety, care and

cleanliness of the Premises and for the preservation of good order therein.

Lessee agrees to abide by all such rules and Regulations hereinabove stated, and

any additional Rules and Regulations which are adopted.

WAIVER OF RULES AND REGULATIONS

32. Lessor may waive any one or more of these Rules and Regulations for the

benefit of Lessee or any other Tenant, but no such waiver by Lessor to a

particular Tenant shall be, (a) construed as a waiver of such Rules and

Regulations in favor of Lessee or any other Tenant to prevent Lessor from

thereafter enforcing any such Rules and Regulations against any or all of the

Tenants of the Premises, and (b) any such waiver shall be deemed temporary in

nature and cancelable at will by Lessor, and Lessee specifically acknowledges

the right of Lessor to rescind said waiver at its sole election and discretion.

HEADINGS

The Titles and Headings of the various sections of this Addendum are

intended solely for the convenience of reference only and are not intended to

explain, modify or place any construction on any of the provisions of this

Addendum.

Page 6 of 7

CONFIDENTIALITY

34. Tenant acknowledges and agrees that the terms of this Lease are confidential

and constitute propriety information of Landlord. Disclosure of the terms hereof

could adversely affect the ability of Landlord to negotiate other leases with

respect to the Project and may impair Landlord's relationship with other tenants

of the Project. Tenant agrees that it and its partners, officers, directors,

employees, brokers, and attorneys, if any, shall not disclose the terms and

conditions of this Lease to any other person or entity without the prior written

consent of Landlord which may be given or withheld by inadequate remedy for the

breach of this provision by Tenant, and Landlord shall also have the right to

seek specific performance of this provision and to seek injunctive relief to

prevent its breach or continued breach.

VIOLATION FEE

35. Anything to the contrary notwithstanding, on the second occurrence of

Lessee's violation of paragraphs 6 through 12, and every occurrence thereafter,

Lessor, at its sole option and in addition to all other rights and remedies

available under this Lease, may charge a fee, as Additional Rent, of $100.00,

which is a fair representation of unanticipated costs to Lessor as a result of

this violation.

STORAGE IN LOFT AREA

36. Lessor and Lessee agree that the area located above Lessee's office(s) is

not intended to be used as storage. The storing of any material in this portion

of your unit is a violation of your Lease Agreement, as well as a City of

Fullerton building code violation, which could result in city fines or

termination of your Lease Agreement.

KEYS

37. Upon vacating the leased Premises, Lessee will provide Lessor with a set of

working keys for the front and back doors, or will be charged to have the locks

re-keyed.

AGREED AND ACCEPTED: AGREED AND ACCEPTED:

"LESSOR" "LESSEE"

FULLERTON BUSINESS CENTER ALLIED MED INC.,

---------------------------------------------- -----------------------------

By ALEXICO, INC., a California corporation AN OREGON CORPORATION

DBA MID VALLEY MANAGEMENT, Managing Agent

By /s/ Xxxxx Xxxxxxx By /s/ Xxxx Xxxx, President

------------------------ ----------------------------------

Xxxxx Xxxxxxx

Its: Authorized Agent By /s/ Xxxx Xxxx, Vice President

Date: _____________

Page 7 of 7

EXHIBIT "C"

MID VALLEY MANAGEMENT COMPANY

Dear Tenant,

There is a California Law which states that we must notify you in advance of the

possibility of a negative credit rating reported to a credit reporting agency. This

does not mean that we believe you have or will ever have a delinquency on your

account with us. It is simply a notification that should your account ever go .into

arrears we could report it to an agency.

We sincerely value you as a tenant, and we do not believe that such a reporting

will ever occur. Please accept this notification as simply our responsibility under

this statute.

"Pursuant to Civil Code, Section 1785.26, you are hereby notified that a negative

credit report reflecting on your credit record may be submitted in the future to a

credit reporting agency if you fail to fulfill the terms of your lease obligations or if

you default in those obligations in any way. This is the only notice that you will

receive in this regard."

This notice at this time has no relation to your credit history with us, it has been

sent to all tenants to fulfill our legal notification requirements. Thank you for your

understanding in this matter.

Sincerely,

MID VALLEY MANAGEMENT COMPANY

/s/ Xxxxx Xxxxxx

Xxxxx Xxxxxx

Collection Manager

0000 X. Xxxxxx Xxx., Xxxxx X, Xxxxxxxxx, XX 00000 . (000) 000-0000

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