LEASE

 

<PAGE>

 

                                                                   EXHIBIT 10.38

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

                                      LEASE

 

               (UNIVERSITY RESEARCH PARK - PHASES XII & XIII [GL])

 

                                     BETWEEN

 

                       IRVINE COMMERCIAL PROPERTY COMPANY

 

                                       AND

 

                              BROADCOM CORPORATION

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

                                      LEASE

               (UNIVERSITY RESEARCH PARK - PHASES XII & XIII [GL])

 

      THIS LEASE is made as of the 17th day of December, 2004, by and between

IRVINE COMMERCIAL PROPERTY COMPANY, a Delaware corporation (formerly known as

Irvine Community Development Company, a Delaware corporation), hereinafter

called "LANDLORD," and BROADCOM CORPORATION, a California corporation,

hereinafter called "TENANT."

 

                       ARTICLE I. BASIC LEASE PROVISIONS

 

      Each reference in this Lease to the "BASIC LEASE PROVISIONS" shall mean

and refer to the following collective terms, the application of which shall be

governed by the provisions in the remaining Articles of this Lease.

 

1.     Premises: Subject to Tenant's election as to the "Option Building"

      contained in Section 2.5 of this Lease, the Premises (more particularly

      described in Section 2.1) shall consist of all of the rentable square

      footage in eight (8) separate buildings, which buildings are designated as

      5300, 5310, 5320, 5330, 5331, 5321, 5311 and 5301 California Avenue,

      Irvine, California. The Premises are depicted on Exhibit A attached hereto

      as Buildings A through H. Each building is referred to as a "BUILDING" and

       all buildings leased by Tenant pursuant to their Lease are collectively

      referred to as the "BUILDINGS."

 

2.     Project and Site Description: The Project is the University Research Park

      as shown on Exhibit Y attached hereto. The Site is a portion of the

      Project and consists of the Buildings outlined on Exhibit A attached

      hereto which are initially leased by Tenant pursuant to this Lease and the

      attendant Common Areas, all as outlined on Exhibit A attached hereto,

      subject to the qualifications in Section 2.1 of the Lease.

 

3.     Use of Premises: general office use including but not limited to (i)

      corporate headquarters functions; (ii) research and development of

      semiconductors and related products, including non-destructive electronic

      laboratory facilities; (iii) storage and shipping of both raw and finished

      goods; (iv) cafeteria, kitchen, work out, health club, child care, and

      medical facilities to serve the needs of the employees and guests of

      Tenant; and (v) any other non-retail use permitted by applicable law, so

      long as such uses are consistent with the applicable zoning ordinances of

      the City of Irvine and with the Ground Leases (including the Development

      Plan incorporated by reference in the Ground Leases).

 

4.     First Phase Target Date: twenty-three (23) months following the end of the

      calendar month during which this Lease is fully executed and delivered by

      and between Landlord and Tenant.

 

      Second Phase Target Date: four (4) weeks following the First Phase Target

      Date.

 

      Third Phase Target Date: eight (8) weeks following the First Phase Target

      Date.

 

      Fourth Phase Target Date: twelve (12) weeks following the First Phase

       Target Date.

 

5.     Term: One hundred twenty-two (122) months following the First Phase

      Commencement Date, plus such additional days as may be required to cause

      this Lease to terminate on the final day of the calendar month.

 

6.     Basic Rent: Commencing on the Commencement Date for each Phase (as defined

      in Article III), the Basic Rent shall equal the product of (i) the

      rentable area of all Buildings in such Phase multiplied by (ii) *** per

      rentable square foot.

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       1

 

<PAGE>

 

  CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

      Basic Rent is subject to adjustment as follows:

 

      Commencing twelve (12) months following the Fourth Phase Commencement Date

      of the Lease, the Basic Rent shall be *** per month, based on *** per

      rentable square foot;

 

      Commencing twenty-four (24) months following the Fourth Phase Commencement

      Date of the Lease, the Basic Rent shall be *** per month, based on *** per

      rentable square foot;

 

      Commencing thirty-six (36) months following the Fourth Phase Commencement

      Date of the Lease, the Basic Rent shall be *** per month, based on *** per

      rentable square foot;

 

      Commencing forty-eight (48) months following the Fourth Phase Commencement

       Date of the Lease, the Basic Rent shall be *** per month, based on *** per

      rentable square foot;

 

      Commencing sixty (60) months following the Fourth Phase Commencement Date

      of the Lease, the Basic Rent shall be *** per month, based on *** per

      rentable square foot;

 

      Commencing seventy-two (72) months following the Fourth Phase Commencement

      Date of the Lease, the Basic Rent shall be *** per month, based on *** per

      rentable square foot;

 

      Commencing eighty-four (84) months following the Fourth Phase Commencement

      Date of the Lease, the Basic Rent shall be *** per month, based on *** per

      rentable square foot;

 

      Commencing ninety-six (96) months following the Fourth Phase Commencement

      Date of the Lease, the Basic Rent shall be *** per month, based on *** per

      rentable square foot; and

 

      Commencing one hundred eight (108) months following the Fourth Phase

      Commencement Date of the Lease, the Basic Rent shall be *** per month,

       based on *** per rentable square foot.

 

7.     Guarantor(s): None

 

8.     Rentable square feet: agreed to be 685,584 in the aggregate, consisting of

      the rentable areas of the Buildings as set forth in Exhibit A-1, subject

      to remeasurement pursuant to Section 2.6.

 

      Usable square feet: agreed to be 634,858 in the aggregate, consisting of

      the usable areas of the Buildings as set forth in Exhibit A-1, subject to

      remeasurement pursuant to Section 2.6.

 

9.     Security Deposit: None

 

10.    Broker(s): Real Estate & Logistics Technology, Inc.

 

11.    Additional Insureds: The Regents of the University of California

 

12.    Address for Payments and Notices:

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                        2

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

<TABLE>

<CAPTION>

LANDLORD                                               TENANT

<S>                                                    <C>

                                                      Prior to Tenant commencing Business

                                                       Operations from the Premises

 

IRVINE COMMERCIAL PROPERTY COMPANY                     BROADCOM CORPORATION

c/o The Irvine Company                                 16215 Alton Parkway

550 Newport Center Drive                               P.O. Box 57013

Newport Beach, CA   92660                               Irvine, CA 92619-7013

Attn:   Senior Vice President, Operations               Attn:   Senior Director, Corporate Services

Irvine Office Properties

                                                       and

 

                                                      BROADCOM CORPORATION

                                                      16215 Alton Parkway

                                                      P.O. Box 57013

                                                       Irvine, CA 92619-7013

                                                      Attn:   Deputy General Counsel

 

with a copy of notices to:                             with a copy of notices to:

 

THE IRVINE COMPANY                                      DLA PIPER RUDNICK GRAY CARY US

550 Newport Center Drive                               LLP

Newport Beach, CA   92660                               550 South Hope Street, 23rd Floor

Attn:   Vice President, Operations                      Los Angeles, CA 90071

Irvine Office Properties,                              Attn: Michael E. Meyer, Esq.

    Technology Portfolio

                                                      and to

 

                                                      Mr. Kim Josephson

                                                       Real Tech

                                                      16215 Alton Parkway

                                                      Irvine, California 92618

</TABLE>

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       3

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

<TABLE>

<S>                                                    <C>

                                                      After Tenant Commences Business Operations

                                                      From the Premises:

 

                                                      BROADCOM CORPORATION

                                                      5300 California Avenue

                                                      Irvine, California 92617

                                                       Attn: Senior Director, Corporate Services

 

                                                      and

 

                                                      BROADCOM CORPORATION

                                                       5300 California Avenue

                                                      Irvine, California 92617

                                                      Attn:   Deputy General Counsel

 

                                                       with a copy of notices to:

 

                                                      DLA Piper Rudnick Gray Cary

                                                      550 South Hope Street, 23rd Floor

                                                       Los Angeles, California 90071

                                                      Attn:   Michael Meyer, Esq.

 

                                                      and

 

                                                      Mr. Kim Josephson

                                                       Real Tech

                                                      16215 Alton Parkway

                                                      Irvine, California 92618

</TABLE>

 

13.    Tenant's Liability Insurance Requirement: $5,000,000.00

 

14.    Vehicle Parking Spaces: 3.5 parking spaces per 1,000 rentable feet of the

      Premises (as such spaces may be reduced to accommodate special Tenant

      requirements such as the installation of a loading dock or generator).

 

15.    The Premises are a portion of certain real property which is ground leased

      by Landlord pursuant to those certain following described ground leases

      (collectively, the "GROUND LEASES"), each executed by and between The

      Regents of the University of California, a California corporation, as

      "Landlord" (the "GROUND LESSOR") and Landlord, as "Tenant": (i) that

      certain Ground Lease (Phase 3) dated July 28, 2000, a memorandum of which

      was recorded on August 30, 2000 as Instrument No. 20000454626 in the

      Official Records of Orange County, California, and (ii) that certain

      Ground Lease (Phase 4) dated July 28, 2000, a memorandum of which was

      recorded on August 30, 2000 as Instrument No. 20000454627 in the Official

      Records of Orange County, California. Tenant understands and acknowledges

      that a material consideration for Landlord entering into this Lease with

      Tenant is the nature of Tenant's business and the mutual benefits to be

      derived by Tenant and by Ground Lessor. Accordingly, in the event of any

      proposed assignment of this Lease or sublease of the Premises or any

      portion thereof, in addition to all of the provisions of Section 9.1 of

      this Lease, Landlord may reasonably withhold its consent to any such

      proposed assignment or sublease if the transferee is not approved by

      Ground Lessor, but only to the extent such Ground Lessor is entitled to

      withhold its consent pursuant to the applicable Ground Lease.

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       4

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

                              ARTICLE II. PREMISES

 

      SECTION 2.1. LEASED PREMISES. Landlord leases to Tenant and Tenant leases

from Landlord the premises (the "PREMISES") within the buildings identified in

Item 1 of the Basic Lease Provisions (the "BUILDINGS"). The Premises and

Buildings, together with the attendant Common Areas as depicted on Exhibit A,

shall sometimes be referred to herein as the "SITE". However, in the event that

Tenant elects not to lease the Option Building (as defined below), then the

Option Building (except with respect to Section 2.4 Rights) and the underlying

real property shall cease to be a part of the Site for purposes of this Lease

(including without limitation the signage provisions set forth in Section 5.2

hereof). The Site is a portion of the project identified in Item 2 of the Basic

Lease Provisions and shown in Exhibit Y attached hereto (the "PROJECT").

Landlord makes no representation that any portion of the Project designated on

Exhibit Y as "Future Development" will be ultimately constructed. The Premises

are agreed to contain, and all references to the "FLOOR AREA" in this Lease

shall mean, the rentable square footage set forth in Item 8 of the Basic Lease

Provisions. Landlord shall have no right to relocate Tenant from the Premises at

any time during the Term of this Lease or any extension.

 

      SECTION 2.2. ACCEPTANCE OF PREMISES. Tenant acknowledges that neither

Landlord nor any representative of Landlord has, except as specifically provided

in this Lease, made any representation or warranty with respect to the Premises,

the Building(s) or the Project or their respective suitability or fitness for

any purpose, including without limitation any representations or warranties

regarding zoning or other land use matters except that the Premises may be used

for general business office operations, and that except as specifically provided

in this Lease, neither Landlord nor any representative of Landlord has made any

representations or warranties regarding (i) what other tenants or uses may be

permitted or intended in the Project, (ii) any exclusivity of use by Tenant with

respect to its permitted use of the Premises as set forth in Item 3 of the Basic

Lease Provisions, or (iii) any construction of portions of the Project not yet

completed. Tenant further acknowledges that neither Landlord nor any

representative of Landlord has agreed to undertake any alterations or additions

or construct any improvements to the Premises except as expressly provided in

this Lease.

 

      Notwithstanding the foregoing or anything in this Lease to the contrary,

Landlord hereby represents and warrants to Tenant that the Buildings, including

the foundation, floor/ceiling slabs, roof, curtain wall, exterior glass and

mullions, windows and seals, columns, beams, shafts (including elevator shafts),

stairs, stairwells, elevator cabs, base building washrooms, and main electrical

room (collectively, "BUILDING STRUCTURE"), the Common Areas, and the mechanical,

electrical, life safety, plumbing, sprinkler systems (connected to the core) and

HVAC systems (collectively, "BUILDING SYSTEMS") shall, upon completion of

construction by Landlord, be in good operating order and condition and in

compliance with all laws applicable to new construction (including, without

limitation, the ADA and laws pertaining to Hazardous Materials), structurally

sound, with water tight roofs and perimeter walls and windows.

 

      SECTION 2.3. BUILDING NAME AND ADDRESS. Subject to the terms of the Ground

Leases and the Development Plan referenced therein and the provisions of Section

5.2 below, Tenant may name the Buildings and the Site and utilize any name

selected by Tenant from time to time for the Building(s) and/or the Site in

designating the location of Tenant's operations. Provided that Tenant is then

leasing at least four (4) full Buildings within the Site, Landlord shall not

have the right to change the name, address, number or designation of the

Building(s) or Site. It is understood that Tenant has requested that the

numbered addresses of the Buildings as currently established be rearranged and

Landlord has agreed to cooperate in seeking approval of the City of Irvine to

that request.

 

      SECTION 2.4. ***

 

            (a)    ***

 

            (b)    ***

 

      SECTION 2.5. OPTION BUILDING. Tenant shall have the right to delete from

this Lease the Building containing approximately 90,900 rentable square feet and

shown on Exhibit A as Building A (the "OPTION

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       5

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

BUILDING"), provided, however, for this right to be exercised Tenant shall

provide written notification to Landlord of Tenant's election to delete the

Option Building from this Lease not later than May 31, 2005.

 

      SECTION 2.6. METHOD OF MEASUREMENT. The rentable and usable areas of the

initial Buildings shall be determined in accordance with the standards set forth

on Exhibit F to this Lease. Either party shall have the right, upon notice

delivered to the other within ninety (90) days following the Delivery Date of a

Phase, to cause Landlord's Architect to remeasure one or more of the Building(s)

in that Phase. In the event that any remeasurement pursuant to the terms of this

Section indicates that the square footage measurement previously set forth in

the Lease or otherwise agreed upon by Landlord and Tenant is incorrect, then any

payments due either party (or other rights between Landlord and Tenant) based

upon the amount of square feet contained in the Premises shall be

proportionally, retroactively and prospectively adjusted to reflect the actual

number of square feet. If Tenant disagrees with the remeasurement by Landlord's

Architect, then Tenant may, by written election not later than thirty (30) days

thereafter, cause such dispute to be resolved pursuant to binding arbitration

pursuant to Section 22.7.

 

                               ARTICLE III. TERM

 

      SECTION 3.1. GENERAL. The term of this Lease ("TERM") shall be for the

period shown in Item 5 of the Basic Lease Provisions. Subject to the provisions

of Section 3.2 below, the Term shall commence on that date (the "COMMENCEMENT

DATE") which is the earlier of (i) five (5) months following the Delivery Date

(as defined in the Work Letter attached as Exhibit X to this Lease) for the

First Phase, as extended for any Landlord Delays and Force Majeure Delays as

defined in the Work Letter, or (ii) the date that Tenant commences its normal

business operations within the First Phase. The Buildings are to be constructed

and delivered to Tenant in phases (collectively, the "PHASES" and each, a

"PHASE") of four (4) Phases, each Phase consisting of two (2) Buildings (except

that the Fourth Phase may be one (1) Building if Tenant timely elects not to

lease the Option Building). Notwithstanding the foregoing, however, Landlord

may, upon at least twelve (12) months prior written notice to Tenant, elect to

deliver the Buildings in as few as two (2) Phases, each of which shall contain

not more than four (4) Buildings. Subject to Section 3.2, the Commencement Date

as to each Phase of the Premises subsequent to the first Phase shall be the date

which is the earlier of (i) five (5) months following the Delivery Date of that

Phase, as extended for Landlord Delays and Force Majeure Delays, or (ii) the

date Tenant commences its normal business operations in the applicable Phase. In

any event, however, the Commencement Date of the Lease shall be deemed to occur

on the Commencement Date of the First Phase of the Site. It is Landlord's

intention to deliver each Phase of the Premises in approximate four (4)-week

intervals, but Landlord shall use its commercially reasonable efforts to

accelerate the delivery of the Phases (but at no additional cost to Landlord).

Prior to Tenant's taking of possession of the Premises or any Phase thereof, the

parties shall memorialize on a form provided by Landlord the actual Commencement

Date for the Premises (or for each Phase thereof), and the Expiration Date of

this Lease. Tenant's failure to execute that form shall not affect the validity

of Landlord's determination of those dates.

 

      SECTION 3.2. DELAY IN POSSESSION. If, for any reason whatsoever, the

Delivery Date for the first two Buildings has not occurred on or before the

"FIRST PHASE TARGET DATE" set forth in Item 4 of the Basic Lease Provisions, the

Delivery Date for the next two Buildings has not occurred on or before the

"SECOND PHASE TARGET DATE" set forth in Item 4 of the Basic Lease Provisions,

the Delivery Date for the next two Buildings has not occurred on or before the

"THIRD PHASE TARGET DATE" set forth in Item 4 of the Basic Lease Provisions,

and/or the Core and Shell Improvements for the final Building(s) has not

occurred on or before the "FOURTH PHASE TARGET DATE" set forth in Item 4 of the

Basic Lease Provisions, then subject to Section 3.3, this Lease shall not be

void or voidable nor shall Landlord be liable to Tenant for any resulting loss

or damage. However, if the Delivery Date for the First Phase fails to occur on

or before the First Phase Target Date (or for any subsequent Phase on or before

the applicable Target Date for that Phase) due to any action or inaction of

Tenant (including without limitation any Tenant Delay described in the Work

Letter attached to this Lease), then the applicable Delivery Date shall, for

purposes of Section 3.1, be deemed advanced by the collective number of days of

delay in excess of thirty (30) caused by Tenant (it being understood that Tenant

may cause up to thirty days of delay in the aggregate without rental penalty).

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                        6

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

      SECTION 3.3. ***.

 

      SECTION 3.4. RIGHT TO EXTEND THIS LEASE. Provided that no Event of Default

exists under any provision of this Lease at the time of exercise of the

extension right granted herein, and provided Tenant has not assigned this Lease

(except for this purpose only, an assignment pursuant to Section 9.4 shall not

be considered an assignment), then Tenant may extend the Term of this Lease for

two (2) successive periods of sixty (60) months. Tenant shall exercise its right

to extend the Term by and only by delivering to Landlord, not less than eighteen

(18) months prior to the expiration date of the Term, Tenant's irrevocable

written notice of its commitment to extend (the "COMMITMENT NOTICE"). If Tenant

so provides in the Commitment Notice, Tenant may extend the Lease as to four (4)

or more full Buildings only, which minimum number of Buildings shall consist of

either Buildings A, B, C, and D as depicted on Exhibit A (the "NORTH BUILDINGS")

or Buildings E, F, G, and H as depicted on Exhibit A (the "SOUTH BUILDINGS").

Should Tenant elect to extend the Lease as to more than four Buildings, the

additional Buildings shall be at the easternmost portion of the Site (e.g.,

should Tenant lease the North Buildings, then any additional Buildings shall

start at Building H and move westward in order as shown on Exhibit A). Should

Tenant extend this Lease as to fewer than all of the Buildings in the Site, then

Tenant's monument signage rights and rights to utilize exterior Common Areas

within the Site shall be appropriately modified to reflect a multi-tenant Site.

 

      The Basic Rent payable under the Lease during any extension of the Term

shall be determined as provided in the following provisions. If Landlord and

Tenant have not by then been able to agree upon the Basic Rent for the extension

of the Term, then not later than one hundred eighty (180) days prior to the

expiration date of the Term, Landlord shall notify Tenant in writing of the

Prevailing Market Rent (as defined in Section 3.5 below) that would reflect one

hundred percent (100%) of the Prevailing Market Rent rate for a 60-month renewal

of comparable space in the Project (together with any increases thereof during

the extension period) as of the commencement of the extension period

("LANDLORD'S DETERMINATION"). Concurrently with the delivery of the Landlord's

Determination, Tenant shall deliver to Landlord Tenant's written determination

of the Prevailing Market Rent ("TENANT'S DETERMINATION"). If within thirty (30)

days following the concurrent delivery of the Landlord's Determination and the

Tenant's Determination the parties are still unable to agree on the rental terms

for the extension period, then either party may thereafter submit the

determination of the Prevailing Market Rent for the extension period to

arbitration pursuant to Section 22.7 below. The arbitrator utilized to reach

such determination shall have at least ten (10) years of experience in

commercial real estate matters.

 

      Within thirty (30) days following the selection of the arbitrator and such

arbitrator's receipt of the Landlord's Determination and the Tenant's

Determination, the arbitrator shall determine whether the Prevailing Market Rent

rate determined by Landlord or by Tenant more accurately reflects one hundred

percent (100%) of the Prevailing Market Rent rate for each 60-month renewal of

the Lease for the Premises. Accordingly, either the Landlord's Determination or

the Tenant's Determination shall be selected by the arbitrator as the Prevailing

Market Rent for the extension period. At any time before the decision of the

arbitrator is rendered, either party may, by written notice to the other party,

accept the rental terms submitted by the other party, in which event such terms

shall be deemed adopted as the agreed Prevailing Market Rent. The fees of the

arbitration shall be borne entirely by the party whose determination of the fair

market rental rate was not accepted by the arbitrator. At any time before the

decision of the arbitrator is rendered, either party may, by written notice to

the other party, accept the rental terms submitted by the other party, in which

event such terms shall be deemed adopted as the agreed Prevailing Market Rent.

 

      Within twenty (20) days after the determination of the Prevailing Market

Rent, Landlord shall prepare an appropriate amendment to this Lease for the

extension period, and Tenant shall execute and return same to Landlord within

ten (10) days after Tenant's receipt of same. Should the Prevailing Market Rent

not be established by the commencement of the extension period, then Tenant

shall continue paying rent at the rate in effect during the last month of the

initial Term, and a lump sum adjustment shall be made promptly upon the

determination of such new rental.

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       7

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

      The rights granted to Tenant under this Section 3.4 are personal to

Broadcom Corporation, a California corporation, and to any assignee thereof

permitted pursuant to Section 9.4 of the Lease. Any other attempt to assign or

transfer any right or interest created by this Section shall be void from its

inception. Tenant shall have no other right to extend the Term beyond the two

(2) successive sixty (60) month extension periods created by this paragraph.

Unless agreed to in a writing signed by Landlord and Tenant, any extension of

the Term, whether created by an amendment to this Lease or by a holdover of the

Premises by Tenant, or otherwise, shall be deemed a part of, and not in addition

to, any duly exercised extension period permitted by this paragraph.

 

      SECTION 3.5. PREVAILING MARKET RENT. The prevailing market rental rate

("PREVAILING MARKET RENT") is defined as the Base Rent, together with any

increases thereof during the extension period, and other economic terms then

being accepted by Landlord for a 60-month lease of comparable space in the

Project in excess of 50,000 rentable square feet (the parties acknowledge that

any transaction in excess of 50,000 rentable square feet will be a "comp"

because they understand that there may be no 600,000 square feet deals and that

one or two 600,000 square feet deals may reflect a distorted picture of the

market place) to a new, non-sublease, non-renewal and non-expansion tenant

(except for extensions by tenants whose leases contain a comparable fair market

extension right, whether or not exercised, and for expansions pursuant to an

option right at a fair market rate) as of the commencement of the applicable

extension term ("COMPARABLE TRANSACTIONS"). To the extent there are not a

sufficient number of Comparable Transactions in the Project, then Comparable

Transactions will also include what a comparable landlord of comparable

buildings with comparable vacancy factors in comparable locations in the

vicinity of the Project ("COMPARABLE BUILDINGS") would accept in Comparable

Transactions, taking into account and adjusting for historic rental

differentials between the Comparable Buildings and the Project. In any

determination of Comparable Transactions appropriate consideration shall be

given to the annual rental rates per rentable square foot, the standard of

measurement by which the rentable square footage is measured, the type of

escalation clause (e.g., whether increases in additional rent are determined on

a net or gross basis, and if gross, whether such increases are determined

according to a base year or a base dollar amount expense stop), parking rights

and obligations (it being specifically understood that because Tenant is granted

free parking hereunder, Landlord shall be entitled to an economic credit if

other tenants of the Project and Comparable Buildings are then paying for

parking), roof/antenna and other license rights, signage rights, abatement

provisions reflecting free rent and/or no rent during the period of construction

or subsequent to the commencement date as to the space in question, brokerage

commissions (but only if Tenant has engaged the services of a broker or Landlord

is otherwise required to pay a commission with respect to the renewal), length

of the lease term, size and location of premises being leased, building standard

work letter and/or tenant improvements allowances, if any, the condition of the

base building and the Landlord's responsibility with respect thereto, the value,

if any, of the existing tenant improvements, all other relevant economic

considerations and other generally applicable conditions of tenancy for such

Comparable Transactions. The intent is that Tenant will obtain (and pay) the

same rent and receive the other economic benefits that Landlord would otherwise

give in Comparable Transactions and that Landlord will make and receive the same

economic payments and concessions that Landlord would otherwise make and receive

in Comparable Transactions.

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       8

 

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CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

                    ARTICLE IV. RENT AND OPERATING EXPENSES

 

      SECTION 4.1. BASIC RENT. From and after the Commencement Date, Tenant

shall pay to Landlord without deduction or offset except as specifically

permitted by this Lease, the rental amount for the Premises shown in Item 6 of

the Basic Lease Provisions (the "BASIC RENT"), including adjustments shown in

said Item 6. Rental adjustments to Basic Rent shown in Item 6 shall be deemed to

occur on the specified monthly anniversary of the Fourth Phase Commencement Date

of the Lease, whether or not the Fourth Phase Commencement Date occurs at the

end of a calendar month. The rent shall be due and payable in advance commencing

on the Commencement Date for each Phase (as prorated for any partial month) and

continuing thereafter on the first day of each successive calendar month of the

Term. No demand, notice or invoice shall be required for the payment of Basic

Rent. Tenant shall not be required to pay the first month's Basic Rent upon

execution of this Lease. Rather, Tenant shall be required to pay the first

month's Basic Rent on the Commencement Date.

 

      SECTION 4.2. OPERATING EXPENSES.

 

      (a)    From and after the Commencement Date, Tenant shall pay to Landlord,

as additional rent, one hundred percent of all Operating Expenses, as defined in

Section 4.2(f), attributable to the Buildings being leased hereunder by Tenant,

which Operating Expenses will include a pro rata allocation of Common Area

expenses incurred by Landlord in the operation of the Site ("TENANT'S SHARE").

During such time as Tenant leases all Buildings within the Site, Tenant shall

pay all Operating Expenses incurred by Landlord in the operation of the Site. It

is understood that the Operating Expenses attributable to the Site shall include

certain items that benefit the Site and other properties owned by Landlord (but

exclusive of charges for Landlord's engineering personnel to the extent that

Tenant is maintaining all Building Systems hereunder), provided that such items

shall be equitably allocated among all affected properties based upon their

comparative rentable areas.

 

      (b)    Prior to the start of the first full or partial "Expense Recovery

Period" (as defined in this Section 4.2), Landlord shall give Tenant a written

estimate (with breakdown by major expense components, prepared on a consistent

basis) of the amount of Tenant's Share of Operating Expenses for the applicable

Expense Recovery Period,. Tenant shall pay the estimated amounts to Landlord in

equal monthly installments, in advance concurrently with payments of Basic Rent.

If Landlord has not furnished its written estimate for any Expense Recovery

Period by the time set forth above, Tenant shall continue to pay monthly the

estimated Tenant's Share of Operating Expenses in effect during the prior

Expense Recovery Period; if any; provided that when the new estimate is

delivered to Tenant, Tenant shall, at the next monthly payment date, pay any

accrued estimated Tenant's Share of Operating Expenses based upon the new

estimate. For purposes hereof, "EXPENSE RECOVERY PERIOD" shall mean every twelve

month period during the Term (or portion thereof for the first and last lease

years) commencing July 1 and ending June 30, provided that Landlord shall have

the right to change the date on which an Expense Recovery Period commences in

which event appropriate reasonable adjustments shall be made to Tenant's Share

of Operating Expenses so that the amount payable by Tenant shall not increase as

a result of such change.

 

      (c)    Within one hundred twenty (120) days after the end of each Expense

Recovery Period, Landlord shall furnish to Tenant a statement showing in

reasonable detail (i.e., by breakdown of major expense components prepared on a

consistent basis) the actual or prorated Tenant's Share of Operating Expenses

incurred by Landlord during the period, and the parties shall within thirty (30)

days thereafter make any payment or allowance necessary to adjust Tenant's

estimated payments of Tenant's Share of Operating Expenses, if any, to the

actual Tenant's Share of Operating Expenses as shown by the annual statement.

Any delay or failure by Landlord in delivering any statement hereunder shall not

constitute a waiver of Landlord's right to require Tenant to pay Tenant's Share

of Operating Expenses pursuant hereto; provided, however, any delay by Landlord

in billing Tenant for any Operating Expenses of more than six (6) months

following the expiration of the Review Period (as defined below) shall be deemed

a waiver of Landlord's right to require payment of Tenant's obligations for any

such Operating Expenses. Any amount due Tenant shall be credited against

installments next coming due under this Section 4.2, and/or against any

installments of Basic Rent next coming due under Section 4.1, unless this Lease

shall have terminated, in which case Landlord shall pay Tenant the amount due

within thirty (30) days, and any deficiency shall be paid by Tenant within

thirty (30) days following receipt of an itemized invoice covering such payment.

Should Tenant fail to object in writing to Landlord's determination of Tenant's

Share of Operating Expenses within two (2) years

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       9

 

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CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

following delivery of Landlord's expense statement ("REVIEW PERIOD"), Landlord's

determination of Tenant's Share of Operating Expenses for the applicable Expense

Recovery Period shall be conclusive and binding on Tenant for all purposes and

any future claims to the contrary shall be barred.

 

      If Tenant disputes the Operating Expense reconciliation, Tenant shall have

the right to meet with Landlord and/or its property manager to inspect

Landlord's records with respect to such disputed items. If after such meeting

and inspection the parties are unable to resolve the dispute, Tenant may cause a

certified public accountant or a real estate professional who specializes in

lease audits, engaged on a non-contingency fee basis, to audit Operating

Expenses by inspecting Landlord's general ledger of expenses not more than once

during any Expense Recovery Period. However, to the extent that insurance

premiums or any other component of Operating Expenses is determined by Landlord

on the basis of an internal allocation of costs utilizing information Landlord

in good faith deems proprietary, such expense component shall not be subject to

audit so long as it does not exceed the amount per square foot typically

incurred by landlords of other first class business parks in Orange County,

California. Tenant shall give notice to Landlord of Tenant's intent to audit

within the Review Period. Such audit shall be conducted at a mutually agreeable

time during normal business hours at the office of Landlord or its management

agent where such accounts are maintained. If after such audit is completed

Tenant still desires to contest the Operating Expenses for such period, then the

results of the audit shall be provided to Landlord. If such audit reveals that

Landlord has overcharged Tenant, then within thirty (30) days after the results

of such audit are made available to Landlord but subject to Landlord's right to

contest the audit result as provided below, Landlord shall reimburse Tenant the

amount of such overcharge with interest thereon at the Interest Rate. If the

audit reveals that Tenant was undercharged, then within thirty (30) days after

the results of the audit are made available to Tenant, Tenant shall reimburse

Landlord the amount of such undercharge with interest thereon at the Interest

Rate. If Tenant's audit determines that Tenant's Share of the actual Operating

Expenses have been overstated by more than five percent (5%), then subject to

Landlord's right to review and/or contest the audit results, Landlord shall

reimburse Tenant for the reasonable out-of-pocket costs of such audit. Tenant's

rent shall be appropriately adjusted to reflect any overstatement in Operating

Expenses. In the event of a dispute between Landlord and Tenant regarding such

audit, such dispute shall be submitted and resolved by binding arbitration

pursuant to Section 22.7 below. All of the information obtained by Tenant and/or

its auditor in connection with such audit, as well as any compromise,

settlement, or adjustment reached between Landlord and Tenant as a result

thereof, shall be held in strict confidence and, except as may be required

pursuant to litigation, shall not be disclosed to any third party, directly or

indirectly, by Tenant or its auditor or any of their officers, agents or

employees. Landlord may require Tenant's auditor to execute a separate

reasonable confidentiality agreement affirming the foregoing as a condition

precedent to any audit. The payment by Tenant of any amounts pursuant to this

Section shall not preclude Tenant from questioning the correctness of any

statement provided by Landlord at any time during a Review Period, but the

failure of Tenant to object thereto prior to the expiration of the Review Period

shall be conclusively deemed Tenant's approval of such statement.

 

      (d)    Even though this Lease has terminated and the Tenant has vacated the

Premises, when the final determination is made of Tenant's Share of Operating

Expenses for the Expense Recovery Period in which this Lease terminates, Tenant

shall within thirty (30) days of written notice pay the entire increase over the

estimated Tenant's Share of Operating Expenses already paid. Conversely, any

overpayment by Tenant shall be rebated by Landlord to Tenant not later than

thirty (30) days after such final determination. The provisions of (c) above

shall also apply to payments due under this paragraph.

 

      (e)    If, at any time during any Expense Recovery Period, any one or more

of the Operating Expenses are increased to a rate(s) or amount(s) in excess of

the rate(s) or amount(s) used in calculating the estimated Tenant's Share of

Operating Expenses for the year, then the estimate of Tenant's Share of

Operating Expenses may be increased by written notice from Landlord for the

month in which such rate(s) or amount(s) becomes effective and for all

succeeding months by an amount equal to Tenant's Share of the increase. Landlord

shall give Tenant written notice of the amount or estimated amount of the

increase and the month in which the increase will become effective. Tenant shall

pay the increase to Landlord as a part of Tenant's monthly payments of the

estimated Tenant's Share of Operating Expenses as provided in Section 4.2(b),

commencing with the month following Tenant's receipt of Landlord's notice.

Notwithstanding the foregoing, Landlord shall only have the right to adjust the

estimated expenses once in any Expense Recovery Period.

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                        10

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

      (f)    The term "OPERATING EXPENSES" shall mean and include all Site Costs,

as defined in subsection (g), and Property Taxes, as defined in subsection (h).

 

      (g)    The term "SITE COSTS" shall include all expenses of operation,

repair and maintenance of the Building(s) and the Site, including without

limitation all appurtenant Common Areas (as defined in Section 6.2), and shall

include the following charges by way of illustration but not limitation: water

and sewer charges; subject to Section 10.2(b) below, insurance premiums or

reasonable premium equivalents should Landlord elect to self-insure all or any

portion of any risk that Landlord is authorized to insure hereunder; license,

permit, and inspection fees; heat; light; power; janitorial services to any

interior Common Areas maintained by Landlord, if any; air conditioning;

supplies; materials; equipment; tools; establishment of reasonable reserves for

replacement and repair of the Building roof; the cost of any environmental

consultant used by Landlord in connection with the Site; the cost of any capital

expenditures but only to the extent of the amortized amount thereof over the

useful life of such capital expenditures calculated at a market cost of funds,

all as reasonably determined by Landlord, for each such year of useful life

during the Term, provided that such capital expenditures shall be limited to (i)

improvements which increase or enhance building security and/or safety (such as

lighting, life/fire safety systems, etc.), (ii) repairs or replacements of the

Building Structure, Building Systems or Common Areas as required for functional

(and not esthetic) reasons, (iii) alterations or improvements required to comply

with any law or change in law first becoming effective as to any Building after

the date hereof; and (iv) expenditures incurred as a cost or labor saving

measure or to affect other economies in the operation or maintenance of the

Buildings or Project (in which event the entire amount of any resulting cost

saving may be included in Project Costs during the applicable Expense Recovery

Period but in no event in excess of the total cost of the capital expenditure)

(collectively, "PERMITTED CAPITAL ITEMS"); costs associated with the maintenance

of an air conditioning, heating and ventilation service agreement (except with

respect to any Buildings for which Tenant is required hereunder to provide such

maintenance), and maintenance of an intrabuilding network cable service

agreement for any intrabuilding network cable telecommunications lines within

the Buildings, and any other installation, maintenance, repair and replacement

costs associated with such lines; labor; reasonably allocated wages and

salaries, fringe benefits, and payroll taxes for administrative and other

personnel (not higher than Building or Project Manager) directly applicable to

the Building(s) and/or Site, including both Landlord's personnel and outside

personnel; any expense incurred pursuant to Sections 6.1, 6.2, 6.4, 7.2, and

10.2; and a competitive management fee for the professional operation of the

Site. ***. It is understood and agreed that Site Costs may include competitive

charges for direct services provided by any subsidiary or division of Landlord.

 

      (h)    The term "PROPERTY TAXES" as used herein shall include the

following: (i) all real estate taxes or personal property taxes which are levied

on the Building and/or the Site and any improvements, fixtures and equipment and

other property of Landlord located in the Buildings and/or the Site, as such

property taxes may be reassessed from time to time; and (ii) other taxes,

charges and assessments which are levied with respect to this Lease or to the

Buildings and/or the Site, and any improvements, fixtures and equipment and

other property of Landlord located in the Buildings and/or the Site, except that

general net income, franchise, capital stock, succession, transfer, gift, estate

or inheritance taxes imposed against Landlord, (iii) all assessments and fees

for public improvements, services, and facilities and impacts thereon, including

without limitation arising out of any Community Facilities Districts, "Mello

Roos" districts, similar assessment districts, and any traffic impact mitigation

assessments or fees; (iv) any tax, surcharge or assessment which shall be levied

in addition to or in lieu of real estate or personal property taxes, other than

taxes covered by Article VIII; (v) taxes based on the receipt of rent (including

gross receipts or sales taxes applicable to the receipt of rent); and (vi) costs

and expenses incurred in contesting the amount or validity of any Property Tax

by appropriate proceedings. General net income or franchise taxes imposed

against Landlord shall be excluded from Property Taxes. ***.

 

      (i)    Notwithstanding the provisions of this Section 4.2 to the contrary,

Operating Expenses shall not include any cost or expense identified as the

responsibility of Landlord and not an Operating Expense or a Site Cost by the

express terms of this Lease, and shall not include any of the following:

 

                  (i)    Any ground lease rental;

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       11

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

                  (ii) Costs which are deemed capital expenditures under

      generally accepted accounting principles consistently applied or otherwise

      ("CAPITAL ITEMS"), except for Permitted Capital Items set forth in (g)

      above and any other items specifically authorized herein;

 

                  (iii) Rentals for items (except when needed in connection with

      normal repairs and maintenance of permanent systems) which if purchased,

      rather than rented, would constitute a Capital Item which is specifically

       excluded in (ii) above (excluding, however, equipment not affixed to the

      Building which is used in providing janitorial or similar services);

 

                  (iv) Costs incurred for the repair of any casualty damage to

      the Buildings and/or the Site if and to the extent that such repair costs

      exceed Two Hundred Fifty Thousand Dollars ($250,000) per occurrence;

 

                  (v) Costs, including permit, license and inspection costs,

      incurred with respect to the installation of tenants' or other occupants'

      improvements in the Site or incurred in renovating or otherwise improving,

      decorating, painting or redecorating vacant space for tenants or other

      occupants of the Site;

 

                  (vi) Depreciation, amortization and interest payments, except

      as provided herein and except on materials, tools, supplies and

      vendor-type equipment purchased by Landlord to enable Landlord to supply

      services Landlord might otherwise contract for with a third party where

      such depreciation, amortization and interest payments would otherwise have

      been included in the charge for such third party's services, all as

      determined in accordance with generally accepted accounting principles,

      consistently applied, and when depreciation or amortization is permitted

      or required, the item shall be amortized over its reasonably anticipated

      useful life;

 

                  (vii) Marketing costs including, without limitation, leasing

       commissions, attorneys' fees in connection with the negotiation and

      preparation of letters, deal memos, letters of intent, leases, subleases

      and/or assignments, space planning costs, and other costs and expenses

      incurred in connection with lease, sublease and/or assignment negotiations

      and transactions with present or prospective tenants or other occupants of

      the Site;

 

                  (viii) Expenses in connection with services or other benefits

      which are not offered to Tenant or for which Tenant is charged for

      directly but which are provided to another tenant or occupant of the Site;

 

                  (ix) Costs incurred by Landlord due to the violation of the

      terms and conditions of any lease of space in the Site;

 

                  (x) Overhead and profit increment paid to Landlord or to

      subsidiaries or affiliates of Landlord for goods and/or services in or to

      the Site to the extent the same exceeds the costs of such goods and/or

      services rendered by unaffiliated third parties on a competitive basis;

 

                  (xi) Interest, principal, points and fees on debts or

      amortization on any mortgage or mortgages or any other debt (except as

      permitted in (ii) above);

 

                   (xii) Landlord's general corporate overhead and general and

      administrative expenses;

 

                  (xiii) Any compensation paid to clerks, attendants or other

      persons in commercial concessions operated by Landlord;

 

                   (xiv) Rentals and other related expenses incurred in leasing

      HVAC systems, elevators or other equipment ordinarily considered to be

      Capital Items, except for (1) expenses in

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       12

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

      connection with making minor repairs on or keeping Building Systems in

      operation while minor repairs are being made, and (2) costs of equipment

      not affixed to the Buildings which is used in providing janitorial or

      similar services;

 

                  (xv) Advertising and promotional expenditures, and costs of

      signs in or on the Buildings and/or the Site identifying the owner of the

      Site or other tenants' signs;

 

                  (xvi) Electric power costs for which any tenant directly

      contracts with the local public service company or of which any tenant is

      separately metered or submetered and pays Landlord directly; provided,

      however, that if any tenant in any Building contracts directly for

      electric power service or is separately metered or submetered during any

      portion of the relevant period, the total electric power costs for such

      Building shall be "grossed up" to reflect what those costs would have been

      had each tenant in such Building used the Building-standard amount of

      electric power;

 

                  (xvii) Services and utilities provided, taxes attributable to,

      and costs incurred in connection with the operation of the retail and

      restaurant operations in the Site;

 

                  (xviii) Costs incurred in connection with upgrading the

      Buildings and/or the Site to comply with disability, life, fire and safety

      codes, ordinances, statutes, or other laws in effect prior to the

       commencement of construction of the Shell and Core Improvements,

      including, without limitation, the ADA, including penalties or damages

      incurred due to such non-compliance;

 

                  (xix) Tax penalties incurred as a result of the failure to

      make payments and/or to file any tax or informational returns when due;

 

                  (xx) Costs for which Landlord has been compensated by a

      management fee;

 

                  (xxi) Costs arising from the negligence or fault of other

      tenants or Landlord or its agents, or any vendors, contractors, or

      providers of materials or services selected, hired or engaged by Landlord

      or its agents;

 

                  (xxii) Notwithstanding any contrary provision of the Lease,

      including, without limitation, any provision relating to capital

      expenditures, any and all costs arising from the presence of those items

      set forth on Landlord's Disclosure attached to this Lease as Exhibit C and

      made a part hereof and hazardous materials or substances (as defined by

      applicable laws in effect on the date the Lease is executed) in or about

      the Premises, the Building or the Site including, without limitation,

      hazardous substances in the ground water or soil, not placed in the

      Premises, the Building or the Site by Tenant, its agents, contractors,

      employees, invitees or subtenants;

 

                  (xxiii) Costs arising from charitable or political

      contributions;

 

                  (xxiv) Costs arising from defects in the base, shell or core

      of the Building(s) or improvements installed by Landlord or repair

      thereof, exclusive of normal wear and tear and ordinary repair items;

 

                  (xxv) Costs for the acquisition of (as opposed to the

      maintenance of) sculpture, paintings or other objects of art;

 

                  (xxvi) Costs (including in connection therewith all attorneys'

      fees and costs of settlement judgments and payments in lieu thereof)

       arising from claims, disputes or potential disputes in connection with

      potential or actual claims, litigation or arbitrations pertaining to

      Landlord and/or the Building(s) and/or the Site;

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       13

 

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CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

                  (xxvii) Costs associated with the operation of the business of

      the entity which constitutes Landlord as the same are distinguished from

      the costs of operation of the Site, including corporate accounting and

      legal matters, costs of defending any lawsuits with any mortgagee (except

      as the actions of Tenant may be in issue), costs of selling, syndicating,

      financing, mortgaging or hypothecating any of Landlord's interest in the

      Site, costs of any disputes between Landlord and its employees (if any)

      not engaged in Building operation, disputes of Landlord with Building

      management, or outside fees paid in connection with disputes with other

      tenants;

 

                  (xxviii) Costs of any initial "tap fees" or any initial sewer

      or water connection fees for the Site;

 

                  (xxix) Costs incurred in connection with any environmental

      clean-up, response action, or remediation on, in, under or about the

       Premises or the Building(s) or the Site except as may be caused by Tenant

      or any of its subtenants, including but not limited to, costs and expenses

      associated with the defense, administration, settlement, monitoring or

      management thereof;

 

                  (xxx) Any expenses incurred for use by other than Tenant or

      its subtenants of any portions of the Site to accommodate events

      including, but not limited to shows, promotions, kiosks, displays,

      filming, photography, private events or parties, ceremonies, and

      advertising beyond the normal expenses otherwise attributable to providing

      Building services, such as lighting and HVAC to such public portions of

      the Building and/or the Site in normal Building operations during standard

      Building hours of operation;

 

                  (xxxi) Any entertainment, dining or travel expenses for any

      purpose;

 

                  (xxxii) Any flowers, gifts, balloons, etc. provided to any

      entity whatsoever, to include, but not limited to, Tenant, other tenants,

      employees, vendors, contractors, prospective tenants and agents;

 

                  (xxxiii) Any "validated" parking for any person or entity;

 

                  (xxxiv) Any "finders fees", brokerage commissions, job

      placement costs or job advertising cost;

 

                  (xxxv) The cost of any magazine, newspaper, trade or other

      subscriptions;

 

                  (xxxvi) The cost of any training or incentive programs, other

       than for tenant life safety information services;

 

                  (xxxvii) The cost of any "tenant relations" parties, events or

      promotion not consented to by an authorized representative of Tenant in

      writing;

 

                  (xxxviii) "In-house" legal and/or accounting fees;

 

                  (xxxix) Reserves of any kind or for any purpose except as

      specifically authorized herein; and

 

                  (xl) Any Operating Expenses or Property Taxes applicable to

      the portion of the Project located outside the Site, except as otherwise

      permitted by this Lease.

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       14

 

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CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

      (j)    In the event any facilities, services or utilities used in

connection with the Building(s) and/or the Site are provided from another

location owned or operated by Landlord or vice versa, the costs incurred by

Landlord in connection therewith shall be allocated to Operating Expenses by

Landlord on a reasonably equitable basis.

 

       (k)    Landlord further agrees that if and to the extent Tenant is leasing

entire Buildings on a net basis, no gross up provision or calculation shall be

included or made in connection with this Lease. Landlord agrees that (i)

Landlord will not collect or be entitled to collect Operating Expenses from

Tenant in an amount which is in excess of one hundred percent (100%) of the

Operating Expenses actually paid by Landlord in connection with the operation of

the Buildings, and (ii) except for Landlord's management fee, Landlord shall

make no profit from Landlord's collections of Operating Expenses. All

assessments and premiums which are not specifically charged to Tenant because of

what Tenant has done, which can be paid by Landlord in installments, shall be

paid by Landlord in the maximum number of installments permitted by law and not

included as Operating Expenses except in the year in which the assessment or

premium installment is actually paid; provided, however, that if the prevailing

practice in Comparable Buildings is to pay such assessments or premiums on an

earlier basis, and Landlord pays on such basis, such assessments or premiums

shall be included in Operating Expenses as paid by Landlord. Landlord shall not

include any imputed interest (except for interest actually paid) on such

assessments or premiums in its computation of Operating Expenses.

 

      (l)    For the purpose of payment of Operating Expenses, to the extent

Landlord pays Property Taxes less frequently than monthly, the cost of same

shall not be included in Operating Expenses but shall be separately calculated,

with Tenant being obligated to pay Tenant's Share of same on the later of five

(5) business days after receipt of an invoice from Landlord or ten (10) days

prior to the date Landlord is obligated to pay same to the taxing authority.

 

                                ARTICLE V. USES

 

      SECTION 5.1. USE. Landlord represents to Tenant that Tenant may use the

Premises for general business office operations without violating any of the

zoning laws applicable to the Building and/or the Site. Tenant shall use the

Premises only for the purposes stated in Item 3 of the Basic Lease Provisions,

all in accordance with applicable laws and restrictions and pursuant to

approvals to be obtained by Tenant from all relevant and required governmental

agencies and authorities. Tenant, at its expense, shall procure, maintain and

make available for Landlord's inspection throughout the Term, all governmental

approvals, licenses and permits required for the proper and lawful conduct of

Tenant's permitted use of the Premises. Tenant shall not do or permit anything

to be done in or about the Premises which will in any way interfere with the

normal and customary business operations of other occupants of the Project, or

use or allow the Premises to be used for any unlawful purpose, nor shall Tenant

permit any nuisance or commit any waste in the Premises or the Site. Tenant

shall not perform any work or conduct any business whatsoever in the Project

other than within the Site. Tenant shall not do or permit to be done anything

which will invalidate or increase the cost of any insurance policy(ies) covering

the Buildings, the Project and/or their contents (unless Tenant elects to pay

such increased costs), and shall comply with all applicable insurance

underwriters rules. Tenant shall comply at its expense (except as specifically

provided to the contrary in this Lease) with all present and future laws,

ordinances, restrictions, regulations, orders, rules and requirements of all

governmental authorities that pertain to Tenant or its use of the Premises,

including without limitation all federal and state occupational health and

safety requirements, whether or not Tenant's compliance will necessitate

expenditures or interfere with its use and enjoyment of the Premises. Tenant

shall comply at its expense with the pertinent provisions of the Ground Leases

(and the Development Plan referenced therein) and with all present and future

covenants, conditions, easements or restrictions now encumbering the Building(s)

and/or Site. Tenant shall promptly upon demand reimburse Landlord for any

additional insurance premium charged by reason of Tenant's failure to comply

with the provisions of this Section, and shall indemnify Landlord from any

liability and/or expense resulting from Tenant's noncompliance. Notwithstanding

the foregoing or anything in this Lease to the contrary, Tenant shall not be

required to make, and Landlord shall make, all repairs to, modifications of, or

additions to the Building Structure and/or the exterior Common Areas of the Site

except and to the extent required because of

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       15

 

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CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

Alterations made by Tenant or Tenant's use of all or a portion of the Premises

for other than normal and customary business office operations.

 

      SECTION 5.2. SIGNS. Tenant shall have the exclusive right on each full

Building leased by Tenant to install and maintain Building "top" and "eyebrow"

signage for Tenant's name and graphics to the extent permitted by the Signage

Criteria (defined below). For so long as Tenant leases at least four (4) full

Buildings in the Site, Tenant shall also have the exclusive right to install and

maintain at least one (1) monument sign at the entrance to the Site (it being

understood that Tenant shall be entitled to two (2) entrance monument signs for

so long as Tenant is leasing at least seven (7) full Buildings in the Site), and

one (1) monument sign for Tenant's name and graphics at the south end of the

Site (facing the 73 Freeway); provided, however, that Tenant's right to the

monument signage facing the 73 Freeway shall be conditioned upon Tenant's

continued leasing of at least two (2) of the South Buildings in their entirety,

it being further understood that such monument shall be shared (with Tenant

being at the top of such sign and no one else having a larger sign on the

monument than Tenant) unless Tenant continues to lease all of the South

Buildings. For so long as Tenant leases all Buildings within the Site, such

Building and monument signage for the Site shall be exclusive to Tenant. All

such exterior signage shall be in locations approved by Landlord, and shall be

subject to Landlord's right of prior approval that such exterior signage is in

compliance with the Signage Criteria. Except as provided in the foregoing,

Tenant shall not have the right to maintain signs in any location on or about

the Building(s) or the Site and shall not place or erect any signs that are

visible from the streets surrounding the Site. The size, design, graphics,

material, style, color and other physical aspects of any permitted sign shall be

subject to Landlord's written determination prior to installation that such

signage has been approved by the Ground Lessor and is in compliance with

Landlord's current signage program for the Site (attached as Exhibit W to this

Lease) and approved by the City of Irvine ("SIGNAGE CRITERIA"). Prior to placing

or erecting any such signs, Tenant shall obtain and deliver to Landlord a copy

of any applicable municipal or other governmental permits and approvals and

comply with any applicable insurance requirements for such signage. Tenant shall

be responsible for the cost of any permitted sign, including the fabrication,

installation, maintenance and removal thereof and the cost of any permits

therefor. If Tenant fails to maintain its sign in good condition, or if Tenant

fails to remove same upon termination of this Lease and repair and restore any

damage caused by the sign or its removal and such failure continues for ten (10)

business days after notice from Landlord to Tenant of such failure, Landlord may

do so at Tenant's expense. Landlord shall have the right to temporarily remove

any signs in connection with any repairs or maintenance in or upon the

Building(s). The term "sign" as used in this Section shall include all signs,

designs, monuments, displays, advertising materials, logos, banners, projected

images, pennants, decals, pictures, notices, lettering, numerals or graphics.

 

      For so long as Tenant leases all Buildings within the Site, no other sign

shall be placed in, on or around the Building(s) and/or the Site (except for the

Building directory) which identifies any person, company or entity other than

Tenant. Under no circumstances shall the Site be named after or referred to

utilizing the name of anyone other than Tenant. Landlord further agrees that it

will not grant any tenant or any one else signage on the monument sign which is

larger in size or higher than Tenant's signage. Tenant's exterior signage rights

hereunder shall be personal to the original Tenant named herein and an Affiliate

thereof, except that Landlord shall authorize a transfer of such rights to a

permitted assignee or subtenant (regardless of whether Tenant is then leasing

all Buildings within the Site) if Landlord reasonably determines that such

transfer would not impair the first class nature of the Project.

 

      SECTION 5.3. HAZARDOUS MATERIALS.

 

      (a)    For purposes of this Lease, the term "HAZARDOUS MATERIALS" includes

(i) any "hazardous material" as defined in Section 25501(o) of the California

Health and Safety Code, (ii) any toxic or hazardous materials, substances,

wastes or materials as defined pursuant to any other applicable state, federal

or local law or regulation, and (iii) any other substance or matter which

results in liability to any person or entity from exposure to such substance or

matter under any statutory or common law theory.

 

      (b)    Tenant shall not cause or permit any Hazardous Materials to be

brought upon, stored, used, generated, released or disposed of on, under, from

or about the Premises (including without limitation the soil and groundwater

thereunder) without the prior written consent of Landlord, which consent may be

given or withheld in Landlord's sole and absolute discretion. Notwithstanding

the foregoing, Tenant shall have the right, without

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       16

 

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CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

obtaining prior written consent of Landlord, to utilize within the Premises

standard office products that may contain Hazardous Materials (such as photocopy

toner, "White Out", and the like), provided however, that (i) Tenant shall

maintain such products in their original retail packaging, shall follow all

instructions on such packaging with respect to the storage, use and disposal of

such products, and shall otherwise comply with all applicable laws with respect

to such products, and (ii) all of the other terms and provisions of this Section

5.3 shall apply with respect to Tenant's storage, use and disposal of all such

products. Landlord may, in its reasonable discretion, place such conditions as

Landlord deems appropriate with respect to Tenant's use of any such Hazardous

Materials, and may further require that Tenant demonstrate that any such

Hazardous Materials are necessary or useful to Tenant's business and will be

generated, stored, used and disposed of in a manner that complies with all

applicable laws and regulations pertaining thereto and with good business

practices. Notwithstanding the foregoing, Tenant may use such materials as are

necessary for Broadcom's research and development operations as long as it

complies with all applicable laws.

 

      (c)    Prior to the execution of this Lease, Tenant shall complete, execute

and deliver to Landlord an Environmental Questionnaire and Disclosure Statement

(the "ENVIRONMENTAL QUESTIONNAIRE") in the form of Exhibit B attached hereto.

The completed Environmental Questionnaire shall be deemed incorporated into this

Lease for all purposes, and Landlord shall be entitled to rely fully on the

information contained therein. On each anniversary of the Commencement Date

until the expiration or sooner termination of this Lease, Tenant shall disclose

to Landlord in writing the names and amounts of all Hazardous Materials which

were stored, generated, used, released and/or disposed of on, under or about the

Premises for the twelve-month period prior thereto, and which Tenant desires to

store, generate, use, release and/or dispose of on, under or about the Premises

for the succeeding twelve-month period. In addition, to the extent Tenant is

permitted to utilize Hazardous Materials upon the Premises, Tenant shall

promptly provide Landlord with complete and legible copies of all the following

environmental documents relating thereto: reports filed pursuant to any

self-reporting requirements; permit applications, permits, monitoring reports,

emergency response or action plans, workplace exposure and community exposure

warnings or notices and all other reports, disclosures, plans or documents (even

those which may be characterized as confidential) relating to water discharges,

air pollution, waste generation or disposal, and underground storage tanks for

Hazardous Materials; orders, reports, notices, listings and correspondence (even

those which may be considered confidential) of or concerning the release,

investigation of, compliance, cleanup, remedial and corrective actions, and

abatement of Hazardous Materials; and all complaints, pleadings and other legal

documents filed by or against Tenant related to Tenant's use, handling, storage,

release and/or disposal of Hazardous Materials.

 

      (d)    Landlord and its agents shall have the right, but not the

obligation, to inspect, sample and/or monitor the Premises and/or the soil or

groundwater thereunder at any time to determine whether Tenant is complying with

the terms of this Section 5.3, and in connection therewith Tenant shall provide

Landlord with reasonable access to all facilities, records and personnel related

thereto, provided Landlord shall provide Tenant with reasonable prior notice. If

Tenant is not in compliance with any of the provisions of this Section 5.3, or

in the event of a release of any Hazardous Material on, under or about the

Premises caused or permitted by Tenant, its agents, employees, contractors,

licensees or invitees, Landlord and its agents shall have the right, but not the

obligation, without limitation upon any of Landlord's other rights and remedies

under this Lease, to immediately enter upon the Premises without notice in the

case of emergency, and otherwise on reasonable prior notice, and to discharge

Tenant's obligations under this Section 5.3 at Tenant's expense, including

without limitation the taking of emergency or long-term remedial action.

Landlord and its agents shall endeavor to minimize interference with Tenant's

business in connection therewith, but shall not be liable for any such

interference. In addition, Landlord, at Tenant's expense, shall have the right,

but not the obligation, to join and participate in any legal proceedings or

actions initiated in connection with any claims arising out of the storage,

generation, use, release and/or disposal by Tenant or its agents, employees,

contractors, licensees or invitees of Hazardous Materials on, under, from or

about the Premises.

 

      (e)    If the presence of any Hazardous Materials on, under, from or about

the Premises or the Site caused by Tenant or its agents, employees, contractors,

licensees or invitees results in (i) injury to any person, (ii) injury to or any

contamination of the Premises or the Site, or (iii) injury to or contamination

of any real or personal property wherever situated, Tenant, at its expense,

shall promptly take all actions necessary to return the Premises and the Site

and any other affected real or personal property owned by Landlord to the

condition existing

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       17

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

prior to the introduction of such Hazardous Materials and to remedy or repair

any such injury or contamination, including without limitation, any cleanup,

remediation, removal, disposal, neutralization or other treatment of any such

Hazardous Materials. Notwithstanding the foregoing, Tenant shall not, without

Landlord's prior written consent, which consent shall not be unreasonably

withheld, take any remedial action in response to the presence of any Hazardous

Materials on, from, under or about the Premises or the Site or any other

affected real or personal property owned by Landlord or enter into any similar

agreement, consent, decree or other compromise with any governmental agency with

respect to any Hazardous Materials claims; provided however, Landlord's prior

written consent shall not be necessary in the event that the presence of

Hazardous Materials on, under or about the Premises or the Site or any other

affected real or personal property owned by Landlord (i) imposes an immediate

threat to the health, safety or welfare of any individual and (ii) is of such a

nature that an immediate remedial response is necessary and it is not possible

to obtain Landlord's consent before taking such action. To the fullest extent

permitted by law, Tenant shall indemnify, hold harmless, protect and defend

(with attorneys reasonably acceptable to Landlord) Landlord and any successors

to all or any portion of Landlord's interest in the Premises and the Site and

any other real or personal property owned by Landlord from and against any and

all liabilities, losses, damages, diminution in value, judgments, fines,

demands, claims, recoveries, deficiencies, costs and expenses (including without

limitation attorneys' fees, court costs and other professional expenses),

whether foreseeable or unforeseeable, arising directly or indirectly out of the

use, generation, storage, treatment, release, on- or off-site disposal or

transportation of Hazardous Materials on, into, from, under or about the

Premises, the Buildings or the Site and any other real or personal property

owned by Landlord caused by Tenant, its agents, employees, contractors,

licensees or invitees. Such indemnity obligation shall specifically include,

without limitation, the cost of any required or necessary repair, restoration,

cleanup or detoxification of the Premises, the Building(s) and the Site and any

other real or personal property owned by Landlord, the preparation of any

closure or other required plans, whether or not such action is required or

necessary during the Term or after the expiration of this Lease, and any loss of

rental due to the inability to lease the Premises or any portion of the Building

or Project as a result of such Hazardous Material or remediation thereof. If

Landlord at any time discovers that Tenant or its agents, employees,

contractors, licensees or invitees may have caused or permitted the release of a

Hazardous Material on, under, from or about the Premises, the Building(s) or the

Site or any other real or personal property owned by Landlord, Tenant shall, at

Landlord's request, immediately prepare and submit to Landlord a comprehensive

plan, subject to Landlord's approval, specifying the actions to be taken by

Tenant to return the Premises, the Building(s) or the Project or any other real

or personal property owned by Landlord to the condition existing prior to the

introduction of such Hazardous Materials. Upon Landlord's approval of such

cleanup plan, Tenant shall, at its expense, and without limitation of any rights

and remedies of Landlord under this Lease or at law or in equity, immediately

implement such plan and proceed to cleanup such Hazardous Materials in

accordance with all applicable laws and as required by such plan and this Lease.

The provisions of this Section 5.3(e) shall expressly survive the expiration or

sooner termination of this Lease.

 

      (f)    Landlord hereby discloses to Tenant, and Tenant hereby acknowledges,

certain facts relating to Hazardous Materials at the Site known by Landlord to

exist as of the date of this Lease, as more particularly described in Exhibit C

attached hereto. Tenant shall have no liability or responsibility with respect

to the Hazardous Materials facts described in Exhibit C, nor with respect to any

Hazardous Materials which Tenant proves were not caused or placed on the

Premises by Tenant, its agents, employees, contractors, licensees or invitees.

Notwithstanding the preceding two sentences, Tenant agrees to notify its agents,

employees, contractors, licensees, and invitees of any exposure or potential

exposure to Hazardous Materials at the Premises that Landlord brings to Tenant's

attention. Landlord hereby represents and warrants that to the best of

Landlord's knowledge, other than as set forth in Exhibit C, as of the date of

this Lease, no other Hazardous Materials are present in, on or around the

Building or the Site. Landlord agrees to indemnify and hold harmless Tenant and

Tenant's employees, agents, directors, officers and partners from claims arising

from the breach of the warranty contained herein. Nothing in this Section or

this Lease shall require Tenant to indemnify Landlord with respect to any

Hazardous Materials which were on or in the Premises, the Building or the Site

prior to the date this Lease was executed or which were placed on or in the

Premises, the Building or the Site by anyone other than Tenant or Tenant's

agents, contractors, subtenants or representatives.

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       18

 

<PAGE>

 

CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

                       ARTICLE VI. COMMON AREAS; SERVICES

 

      SECTION 6.1. UTILITIES AND SERVICES. Tenant shall be responsible for and

shall pay promptly, directly to the appropriate supplier, all charges for water,

gas, electricity, sewer, heat, light, power, telephone, telecommunications

service, refuse pickup, janitorial service, interior landscape maintenance,

interior and exterior pest control, interior and exterior window washing,

security services, exterior plumbing (back flows testing), and all other

utilities, materials and services furnished directly to Tenant or the Premises

or used by Tenant in, on or about the Premises during the Term, together with

any taxes thereon. Tenant shall provide whatever janitorial and security

services it deems appropriate for the Site and the Buildings and Landlord shall

have no responsibility for and shall not provide janitorial or security services

to the Site or the Buildings unless requested to do so by Tenant. If any

utilities or services are not separately metered or assessed to Tenant, Landlord

shall make a reasonable determination of Tenant's proportionate share of the

Actual Cost (as hereinafter defined) of such utilities and services, and Tenant

shall pay such amount to Landlord, as an item of additional rent, within thirty

(30) days after receipt of Landlord's statement or invoice therefor. For

purposes of this Lease, the term "Actual Cost" shall mean an amount equal to

actual incremental cost to Landlord to provide the applicable service or utility

to Tenant, without markup for profit. Alternatively, Landlord may elect to

include such cost in the definition of Site Costs in which event Tenant shall

pay Tenant's proportionate share of such costs in the manner set forth in

Section 4.2. *** Landlord shall not be liable for damages or otherwise for any

failure or interruption of any utility or other service furnished to the

Premises, and no such failure or interruption shall be deemed an eviction or

entitle Tenant to terminate this Lease or withhold or abate any rent due

hereunder except as otherwise provided in this Lease. Landlord shall at all

reasonable times have free access to the Building and Premises to install,

maintain, repair, replace or remove all electrical and mechanical installations

of Landlord; provided, however, that if such electrical and/or mechanical

installations are located in the Premises, Landlord shall provide Tenant with

reasonable prior notice of this intent to access same and shall follow Tenant's

reasonable instructions as to the time and manner such work is to be performed

so as to minimize disruption to Tenant's business operations.

 

      Notwithstanding the foregoing, if for more than five (5) consecutive

business days following written notice to Landlord (the "Eligibility Period"),

(a) there is no HVAC or electricity service to all or a portion of the Premises,

or such an interruption of other essential utilities and building services, such

as fire protection or water, (b) there is any repair, maintenance or alteration

performed by Landlord, and/or (c) there is any failure by Landlord to provide

Tenant with access to the Premises or the parking areas, so that Tenant is

prevented from using and does not use all or a portion of the Premises, then

provided such interruption of services is not attributable to the fault or

neglect of Tenant, its agents, employees, contractors or subtenants or the

failure by Tenant to fulfill its responsibilities hereunder (taking into account

that Tenant shall, except as otherwise provided herein, be responsible for the

maintenance and repair of Building Systems), Tenant's rent (inclusive of Basic

rent and Operating Expenses) shall thereafter be abated in the same proportion

that the Floor Area of the Premises rendered unusable from time to time bears to

the total Floor Area of the Premises until the Premises are again usable by

Tenant. However, in the event that Tenant is prevented from conducting, and does

not conduct, its business in any portion of the Premises for a period of time in

excess of the Eligibility Period, and the remaining portion of the Building is

not sufficient to allow Tenant to effectively conduct its business therein, and

if Tenant does not conduct its business from such remaining portion, then for

such time after expiration of the Eligibility Period during which Tenant is so

prevented from effectively conducting its business therein, the rent for the

entire Building shall be abated; provided, however, if Tenant reoccupies and

conducts its business from any portion of the Building during such period, the

rent allocable to such reoccupied portion, based on the proportion that the

rentable area of such reoccupied portion of the Building bears to the total

rentable area of the Building, shall be payable by Tenant from the date such

business operations commence. The foregoing provisions shall be Tenant's sole

recourse and remedy in the event of such an interruption of services, and shall

not apply in case of damage to, or destruction of, the Premises (which shall be

governed by the provisions of Article XI of the Lease). Any disputes concerning

the foregoing provisions shall be submitted to and resolved by arbitration

pursuant to Section 22.7 of this Lease.

 

      SECTION 6.2. OPERATION AND MAINTENANCE OF COMMON AREAS. During the Term,

Landlord shall, except as provided in this Lease to the contrary, operate and

maintain all exterior Common Areas within the Site in a first-class manner. The

term "COMMON AREAS" shall mean all areas within the Site that are

 

*** Confidential treatment has been requested for the redacted text of this

document. The confidential redacted text has been omitted and filed separately

with the Securities and Exchange Commission.

 

                                       19

 

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CONFIDENTIAL TREATMENT REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT.

 

outside the footprint of each of the Buildings including, without limitation,

parking areas and structures, driveways, sidewalks, landscaped and planted

areas.

 

      SECTION 6.3. USE OF COMMON AREAS. The occupancy by Tenant of the Premises

shall include the use of the Common Areas in common with Landlord and with all

others for whose convenience and use the Common Areas may be provided by

Landlord, subject, however, to compliance with all rules and regulations as are

prescribed from time to time by Landlord. All costs incurred by Landlord for the

maintenance and operation of the Common Areas shall be included in Site Costs

except to the extent any particular cost incurred is related to or associated

with Tenant and can be charged directly to Tenant. Tenant shall keep the Common

Areas clear of any obstruction or unauthorized use related to Tenant's

operations or use of Premises, including without limitation, planters and

furniture. Unless caused by the negligence or willful misconduct of Landlord or

its agents, contractors or employees and not covered by Tenant's insurance,

nothing in this Lease shall be deemed to impose liability upon Landlord for any

damage to, or loss of the property of, Tenant. As long as Tenant's access to

and/or use of the Premises is not adversely affected, Landlord may temporarily

close any portion of the Common Areas for repairs, remodeling and/or

alterations, to prevent a public dedicatio