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EXHIBIT 10.10 LEASE AGREEMENT

Lease Agreement

EXHIBIT 10.10   LEASE AGREEMENT | Document Parties: NOVACEPT INC | Zona Industrial Global, ZIG S. A. You are currently viewing:
This Lease Agreement involves

NOVACEPT INC | Zona Industrial Global, ZIG S. A.

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Title: EXHIBIT 10.10 LEASE AGREEMENT
Date: 1/12/2004

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                                                                   EXHIBIT 10.10

 

                                 LEASE AGREEMENT

 

Entered into at the city of San Jose, on the twentieth day of the month of May

of the year 2003, between:

 

          KPMG FIDES (COSTA RICA) S.A., corporate identification number three-one

         hundred one-one hundred seventy one thousand nine hundred eighty five,

         as Trustee (the "Lessor") of the Global Park's Guaranty Trust ("Trust

         Agreement"), executed on March 23, 2001, represented in this act with

         enough power by ALFONSO AMEN CHEN, personal identity card number

         two-three hundred fifty six-three hundred eleven, legal authority duly

         recorded in the Mercantile Section of the National Registry under books

         eight hundred ninety six, nine hundred forty, one thousand two hundred

         ninety, pages two hundred fifty one, forty four, one hundred seventy

         five, and entries three hundred nineteen, sixty four, two hundred four.

 

         PARQUE GLOBAL S.A., corporate identification card number three- one

         hundred one- two hundred thirty thousand five hundred seventy eight,

         (the "Developer"), registered in the Mercantile Section of the Public

          Registry under book one thousand one hundred twenty six, page two

         hundred seventy one, entry three hundred seventeen, represented in this

         act with enough power by Carlos Wong Zuniga, personal identity card

         number one- six six four- nine eight nine, legal representation duly

         recorded in the Mercantile Section of the Public Registry under book

         one thousand three hundred sixty five, page one hundred ninety one,

         entry one hundred ninety one.

 

for the one part and for the other,

 

         Novacept, Federal tax ID Number 770339123 (the "Lessee"), incorporated

         in the Estate of California; Corporate Address 1047 Elwell Court, Palo

         Alto California 94303, United Estates. Represented in this act with

         enough power granted by Donald R. Nathe; of legal age, bearer of the

         passport number 053930087, permanent resident of 558 Lincoln Avenue

         Palo Alto, California, 94301.

 

1.- Whereas the Lessee desires to lease a new building located in Global

Industrial Park and Free Trade Zone, part of the "Condominio Global" (the

"Condominium"), condominium identity number 3-109-328791, a condominium

registered in the Costa Rican Public Registry, Province of Heredia, Property

Number M-001679, Lot Number Five, registered in the Public Registry Property of

Heredia, Property Number H-4033936F-000, of which approximately 2,468 sq. mts.

(26,565 sq. ft.) constitutes the leased real estate (the "Real Estate"), to be

utilized for the manufacture and assembly of medical devices and related and

ancillary products and lines of business.

 

2.- Whereas the Real Estate forms part of a bigger property which has been

transferred to KPMG Fides (Costa Rica) S.A. in trust, through the GLOBAL

GUARANTY TRUST ("Trust Agreement"), executed on March 23, 2001, by Parque Global

S.A. as Grantor of the Trust Agreement, and Scotiabank de Costa Rica S.A. as

main Beneficiary of the Trust Agreement;

 

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3.- Whereas the Grantor and the main beneficiary of the Trust Agreement have

instructed KPMG Fides as a Trustee to enter into this lease agreement, and all

parties acknowledge that KPMG Fides will act in accordance with the instructions

received by the main beneficiary and the Developer, and expressly agree that

KPMG Fides enters into the present Agreement acting solely as trustee of the

Trust. Consequently, KPMG Fides' obligations and duties in relation with this

Agreement are limited to its execution;

 

Now therefore in consideration of the premises and the mutual promises herein

made, and in consideration of the representations, warranties, and covenants

herein contained, the Parties have agreed to execute this lease agreement:

 

SECTION ONE: OF THE LEASED GOOD

 

1.00 BACKGROUND, STATUS, AND OWNERSHIP OF THE REAL ESTATE

 

         The Trustee is the fiduciary owner of record of the real property

         registered under the computerized "folio real" system of the National

         Registry number one hundred seventy eight thousand six hundred fifty

         five - zero zero zero (178.655-000), Province of Heredia (hereinafter

         referred to as "the Land"). Such registration corresponds to a piece of

         land with the nature, location, boundaries, measures, and other legal

         characteristics as identified in the National Registry. On such real

         estate is located the Free Trade Zone and Industrial Park identified as

         "Global Park", which is being operated and being developed by Parque

         Global, S. A.. Such Free Trade Zone Status was granted by the Executive

         Agreement number twenty nine-ninety nine, published in the official

         newspaper, "La Gaceta", number forty-one, on March first of nineteen

         hundred ninety nine. As of the signature of this Agreement, the

         Developer acknowledges and accepts before the Trustee and the Lessee

         that it will be responsible before the Lessee for any and all of the

         obligations and liabilities derived from the ownership of the Real

         Estate beyond the mere fiduciary ownership of the Real Estate held by

         the Trustee. In the same manner, the Developer will have before the

         Lessee the power to exercise the rights and faculties derived from the

         mere ownership of the Real Estate that go beyond the mere fiduciary

         ownership of the Real Estate held by the Trustee, all of which is

         hereby acknowledged and accepted by the Lessee and the Trustee.

 

1.01      ACCEPTANCE BY THE DEVELOPER OF THE COMPROMISES STATED IN THE AGREEMENT

 

         PARQUE GLOBAL, S. A., as Grantor of the Trust Agreement described in

         this contract, and as Developer of Global Park, acknowledges, accepts

         and guarantees to the Lessee and the Lessor the compliance and

         fulfillment of all the covenants and obligations which require its

         participation in accordance with the terms and conditions established

         in this contract, and that it will hold the Lessor and its assets

         harmless from any liability arising from any obligation, loss, damage,

         penalty, tax liability, claim, lawsuit, expense or disbursement,

         including but not limited to legal fees or expenses resulting directly

         or indirectly from the

 

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          non-compliance on behalf of the Developer of any of the provisions

         contained in this Agreement; and will therefore proceed to subscribe

         this document as a symbol of its acceptance and compromise.

 

SECTION TWO: OF THE LEASED REAL ESTATE

 

2.00 LEASED REAL ESTATE

 

         The Lessor rents out to the Lessee, who accepts, a manufacturing

         building located in a section of Condominium lot number five with the

         characteristics and conditions that are stated in the contract herein

         (the "Leased Real Estate"), with an approximate constructive dimension

         of two thousand four hundred sixty eight square meters (2,468 sq.

         mts.), (which is equivalent to twenty six thousand five hundred and

         sixty five square feet).

 

         The purpose of the Leased Real Estate shall be exclusively for the

         manufacture, assembly, storage, warehouse and office use of medical

         devices and related and ancillary products as well as related lines of

         business. The Lessee shall not alter the purpose of the Leased Real

         Estate without manifest and written authorization of the Lessor and the

         Developer. As stated in article 4.00 of this Agreement, it is

         understood that Lessee shall at all times comply with all the

         corresponding municipal and governmental regulations in the carrying

         out and execution of its activities, as may be, but are not limited to,

         the Health Ministry's regulations.

 

2.01      REAL ESTATE CONDITIONS

 

         The Lessee shall receive the Leased Real Estate according to the

         conditions of this clause and with the conditions and characteristics

         described in the documents that jointly conform EXHIBIT ONE of this

         contract that the Lessee understands and accepts without objections.

         The Leased Real Estate shall conform to all requirements conditions,

         restriction and encumbrances of the covenants and internal regulations

         attached as Exhibit Two(CC&R's) and all rules regulations statutes

         ordinances, laws and building codes (collectively "Laws") applicable

         thereto and will provide the construction quality guarantees required

         under these Codes. Lessee shall not be required to construct or pay the

         cost of complying with any CC&R's or laws required for the construction

         of Leased Real Estate.

 

2.02      ADDITIONAL FACILITIES

 

         In addition to any other facility specifically included in this lease

          agreement, the Leased Real Estate shall comprise: (a) Parking.- The

         Leased Real Estate includes nine parking spaces in the front of the

         building and seven parking spaces on a satellite parking area located

         within walking distance for standard-sized vehicles, outlined by road

         demarcations according to the country's standards and to the plans and

         specifications that are an integral part of the present Agreement and

         which have been enclosed as EXHIBIT ONE. Parking spaces are

         specifically referred to those located within the Leased Real Estate;

         in

 

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         case any additional parking spaces shall be required, the Developer

         will assign them at its convenience and Lessee will pay a forty dollar

         ($40.00) monthly fee for each of them; (b) Common areas. The Lessee can

         make use of the Industrial Park's common areas according to the

         regulations and specifications included in the Global Park's Internal

         Regulations (CC&R's) and its subsequent amendments, which have been

         enclosed as an integral part of this Agreement in its current form as

         EXHIBIT TWO; (c) Sewage Treatment Plant.- The Lessee shall make use of

          the sewage treatment plant located in the Park, according to the usage

         regulation included as EXHIBIT THREE.

 

2.03      SPECIAL EQUIPMENT AND SYSTEMS

 

         The Lessee may request, at its own expense, the installation of certain

         special systems and equipment in the Leased Real Estate in accordance

         with CC&R's.

 

SECTION THREE: OF THE RENT AND LEASE TERM

 

3.00. RENT

 

         The monthly rent to be paid for the Leased Real Estate (the "Rent") by

         the Lessee during the first twelve months of the contract's term shall

         be sixteen thousand four hundred and seventeen dollars (US$ 16,417.00)

         Legal currency of the United States, equivalent to $7,41 per square

         foot per year. The Lessee shall begin making such payments after the

         Date of Delivery in accordance with the terms and conditions stated

         herein. As of and starting on the thirteenth month of the contractual

         term, and until the expiration of the present contract, the monthly

         Rent shall undergo a five percent yearly increase, using as basis for

         such increase the Rent paid in the last month of every twelve month

         period ("Annual Increase Rate"). The effective rental fee in each

         period shall be paid monthly and in advance within the first five

         calendar days of each month. Payments can be made in cash, check, or

         electronic transfer to the Developer's account, whose validity remains

         subject to its approval. In this last case, the Lessee shall notify in

         writing to the Developer, the date in which the transfer was executed,

         and such payment shall be deemed made on the date on which the transfer

         is credited by the Developer's bank. All applicable transfer fees or

         bank charges must be paid by the Lessee. For purposes of this

         Agreement, the Developer's address shall be the address in effect where

         payments should be made. In the event that the beginning or end of the

          term of this Lease is not the first of a month, rent shall be prorated

         such that Lessee shall only pay the portion of the rent allocated to

         the portion of the month the Leased Real Estate is occupied by the

         Lessee. In case of default by the Lessee of the obligation contained

         herein, there shall be a cure period to remedy the situation as

         described in section 6.01, Rent shall not include, and Lessee shall

         not be required to pay as Rent or otherwise any "Ordinary or

         Extraordinary Maintenance Fees", except for Service Agreement

         (reference clause 4.15) and CC&R's fees or any other fees as agreed to

         by both parties.

 

3.01      TERM OF THE LEASE

 

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         The lease shall be effective as of the Date of Delivery (as defined in

         Section 3.02 hereof) to Lessee of the Leased Real Estate, and shall

         have a duration of five (5) years thereafter (the "Initial Term").

         Lessee shall have the right, so long as it is not in default under the

         terms of the Lease Agreement, by sending a written notice to Lessor and

         Developer upon not less than six (6) months prior to the foreseen

         expiration of the lease term in effect, to extend the Lease for an

         additional five (5) year term (the "First Extended Term"). Lessee shall

         have the right to extend the Lease for an additional five (5) year term

         (the "Second Extended Term"), under the same terms and conditions

         required for the First Extended Term. The rent for the First and Second

         Extended Terms will be set by the Annual Increase Rate for the monthly

         rent in effect at the last month of the Initial Term or the First

         Extended Term for the subsequent Second Extended Term.

 

3.02      LEGAL EFFECT OF THE AGREEMENT

 

         The Agreement's legal effects regarding the use and enjoyment rights,

         as well as its obligations as park tenants, shall commence as of the

         date of delivery of the Leased Real Estate. The Date of Delivery of the

         Leased Real Estate (the "Date of Delivery") shall be understood as the

         date in which the Leased Real Estate has been completed according to

         the construction details stated in EXHIBIT ONE. As of the Date of

         Delivery, the building will be substantially completed by the Developer

         for purposes of the occupation by the Lessee i) for having been

         completed in more than ninety-five percent, according to the completion

         percentage indicated by the appointed inspectors, based in the

         construction agreement and any improvements as listed in EXHIBIT ONE,

         to this Agreement, ii) in compliance with all applicable Laws and

          permits included in Clause 2.01 iii) Lessee shall have been permitted,

         at any time after concrete floor has been cured, early access to the

         warehouse area of the Leased Real Estate prior to the Date of Delivery

         for the purpose of the Lessee's improvements, iv) such that there are

         no conditions existing, or items remaining to be completed, as would

         interfere with Lessee's occupancy and use of the space for the

         permitted use under this Lease, v) the Leased Real Estate will be in

         good condition and repair, and the electrical, mechanical HVAC plumbing

         and other systems serving the Leases Real Estate and described in

         Exhibit One will be in good condition and repair. In the event that the

         Lessee does not agree with any of the above mentioned conditions, the

         dispute shall be submitted to an Engineers and Architects Board

         Arbitration process, and its final resolution must be accepted by the

         Lessee and the Developer. In any event, the portion of the works that

         have not been concluded at the Date of Delivery shall be finished in a

         term not greater than thirty calendar days, unless otherwise stated.

         Notwithstanding anything to the contrary in this Lease, Lessee's

         acceptance of the Leased Real Estate shall not be deemed a waiver of

         Lessee's right to have defects in the Leased Real Estate repaired at

         Developer's sole expense. Lessee shall give notice to Developer

         whenever any such defect becomes reasonably apparent, and Developer

         shall repair such defect as soon as practicable.

 

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3.03      DELAYS ATTRIBUTABLE TO THE DEVELOPER

 

         If for causes attributable to the Developer, its contractors, agents or

         employees, the delivery of the Leased Real Estate does not take place

         before the twenty four weeks after the date of signature of this Lease

         Agreement, the Developer shall acknowledge in favor of the Lessee a

         fine, as a fixed and sole compensation for damages or losses,

         equivalent to a day's rent per calendar day of delay, which shall be

         estimated by dividing the applicable rental fee for the first period

          by thirty. The relevant fine shall be deducted by applying a twelfth of

         the amount in each of the first twelve months of the Lease Agreement's

         legal term. Notwithstanding anything to the contrary contained herein,

         in the event that for any reason the Leased Real Estate is not

         delivered for possession by Lessee in the condition required by Section

         3.02 hereof on or before December 31, 2003, Lessee shall have the right

         to terminate this Lease. The Lessee accepts that it shall not present a

         claim against the Developer or attempt to collect any losses, damages,

         penalties, expenses, disbursements or amounts, including but not

         limited to, legal fees or expenses, request a sum for damages or losses

         if due to force majeure, acts of God, or other causes not attributable

         to the Developer, it is not possible to deliver the property on the

         date convened in the clause herein. In such case, the Developer will

          return the security guarantee deposit to the Lessee, as fixed and sole

         indemnification for the termination of the contract. Once the Lessee is

         indemnified, it guarantees and acknowledges that it will not file any

         lawsuits or claims to recover additional amounts from the Developer or

         from the Lessor, hence the Lessee will hold the Developer and the

         Lessor harmless after having received the indemnification amount.

 

3.04      SECURITY DEPOSIT

 

         With the execution of this Agreement, the Developer has received from

         the Lessee, one hundred and three thousand nine hundred and sixty two

         dollars (US$103,962.00) an amount equivalent to six months rent to be

         retained by Developer as a security deposit (the "Deposit") The Deposit

         shall serve as a guarantee to cover the payment of outstanding

         services, repairs and any other obligation derived from this Agreement,

         to the Developer's satisfaction. The Developer shall have the right,

         but not the obligation, to use the Deposit to settle outstanding rent

         payments. If all or part of the Deposit were used by the Developer for

         any of the aforementioned items, the Lessee shall have an obligation to

         reinstate the used amount within five (5) calendar days following

         notice of its use by the Developer, unless such use is made upon

         termination of the lease, in which case the remnant, if any, shall be

         returned by the Developer to the Lessee in the sixty (60) calendar days

         following the date on which this Agreement is terminated, and prior

         verification that all utilities bills corresponding to the Lessee are

         fully paid. The Deposit shall not bear any interest for the benefit of

         the Lessee.

 

SECTION FOUR: OF THE LESSEE'S RIGHTS AND OBLIGATIONS

 

4.00 RESTRICTIONS OF THE LEASED REAL ESTATE

 

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         The Lessee: (a) shall not modify the purpose of the Leased Real Estate

         without prior authorization of the Developer which authorization shall

         not be unreasonably withheld or delayed; (b) shall not carry out,

         within the Real Estate, any type of activity that produces noises,

         smells or disturbing activities to other occupants of Global Park or

         other neighbors of the area where the Leased Real Estate is located,

         and that the execution of such activities shall at all times comply

         with the corresponding local and national regulations; (c) accepts that

         the activities performed in the Leased Real Estate shall not produce

         emanations that can adversely affect the environment or people's

         health, and that the execution of such activities shall at all times

         comply with the corresponding local and national regulations; (d) shall

         not use the Leased Real Estate for the storage of flammable or

         dangerous substances, materials or chemicals unless such substances,

         materials or chemicals are used in their manufacturing operations. In

         these cases, the Lessee must communicate in writing such circumstance

         to the Developer, including a list describing such items. The

         substances, materials, or chemicals should be property stored in

         accordance with the applicable laws, regulations, and any other safety

         provisions. In case of default by the Lessee of the obligations

         contained herein, it will have a cure period to amend the situation as

         described under section 6.01.

 

4.01      PARK REGULATION

 

         The Lessee shall respect at all times the Global Park's Condominium

         Bylaws, in its current text and its amendments. Said regulations, which

         the Lessee is cognizant and accepts, shall be enclosed to the contract

         herein as EXHIBIT TWO.

 

4.02      REPAIRS AND IMPROVEMENTS

 

         The Developer shall be obligated to maintain, at its expense, of the

         Leased Real Estate in general, including but not limited to, the

         exterior structural elements, exterior pluvial, and sewage water

         systems, and interior building systems as define at Exhibit One as well

         as pay for all other maintenance fees or repairs derived from the

          normal wear and tear of the Leased Real Estate. The Developer shall

         cooperate with Lessee to enforce ail such warrantees with respect to

         the Leased Real Estate which will reduce Lessee's maintenance

         obligations, but shall not be obligated to maintain at is expense the

         interior of the Real Estate in general, even if such maintenance could

         be considered as necessary because of the normal wear and tear of the

         building. The Lessee shall bear the cost of any other repair such as

         broken glasses, burnt light bulbs, gaskets and, generally, any service

         accessory or accessories incorporated to the Real Estate, except for

         those generated by the normal wear and tear of the Real Estate. Any

         damages or repairs caused or generated by the Lessee's negligence or

         willful misconduct shall run at the Lessee's expense, as well as all of

         the secondary elements added to the Leased Real Estate on behalf of the

         Lessee, except as set forth in section 5.11 below. Without affecting

         the above, the Lessee shall not, without the prior written consent of

         the Developer which shall not be unreasonably withheld or delayed, make

         changes or adjustments to the Leased Real Estate, even if related to

         indoor or outdoor maintenance works. It shall not be necessary to

 

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         obtain prior consent from the Developer to make indoor changes,

         adjustments or maintenance works whenever these do not affect the

         Leased Real Estate's structure or are permanently affixed to the same.

         If authorization is received, all investments, non-removable

         improvements or the removals that once removed may cause damage to the

         Real Estate, shall be for the benefit of the Developer, without giving

         rise to the Lessee to request a deduction in the rent or an economic

         compensation for these upon termination of the lease's term.

 

4.03      RESPONSIBILITY FOR DAMAGES

 

         The Lessee shall be liable for any damage or loss incurred to or

         suffered by the Real Estate, which is caused by or attributable to its

         employees, officers and/or agents, or by third parties or clients that

         visit or use the Real Estate, except as set forth in section 5.11

         below. Furthermore, it shall be responsible for the damages caused, by

         any of the aforementioned individuals, to common areas of the Park. Any

         form of damage caused by the Lessee, or any of the aforementioned

         individuals in this clause, shall be repaired by the Lessee, at its own

         expense, without the right to demand from the Developer a reimbursement

         or cost deduction from the lease. Repairs shall be initiated within a

         term no greater than eight calendar days, except in cases of emergency,

         whereby they should be fixed immediately, allowing the Lessee to hire

         the workers it deems suitable. Prior to making the repairs, it shall

         have the approval in writing of the Developer with regards to quality

         and work opportunity. In such cases, the Developer must respond within

         the following twenty-four hours following the receipt of a written

         communication by the Lessee. Should the Developer not respond within

         the aforementioned time frame, the authorization will not be deemed

         granted, but the eight (8) day period will not begin until the day

         after an affirmative response is rendered by the Developer. If repair

         works have not been performed in the aforementioned term, the Developer

         shall notify the Lessee of said noncompliance and it shall provide to

         the Lessee a cure period of eight calendar days ("Cure Period") to

         initiate the repairs. If the Lessee does not initiate the repairs

         within the Cure Period, the Developer can request the termination of

         the Agreement due to non-fulfillment and is fully authorized to deduct

         from the Deposit the necessary amount for repairs, and perform them on

         behalf of the Lessee. By virtue of this clause, the Lessee's liability

         is comprehensive and includes any violation acts to the legal system,

          caused by Lessee's activities in or use of the Leased Real Estate,

         whether by its employees, officers and/or agents or by third parties or

         clients that visit or use the Leased Real Estate, may these be civil,

         labor, environmental, health-related or any other sector, even when

         these acts are not subjected to an economic compensation. In case of

         default by the Lessee of the obligation contained herein, it will have

         a cure period to amend the situation as described under section 6.01.

 

4.04      ACCIDENTS

 

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         The Developer and the Lessor do not assume civil, penal, labor, or any

         other type of responsibility, for damages or losses incurred to the

         Lessee or third parties. Notwithstanding the foregoing, in no event

         shall the Lessor or Developer be liable for business losses, motivated

         or as a consequence of accidents caused to it due to the Lessee's

         responsibility, fraud or fault, as well as due to force majeure, during

         the effective term of this lease agreement and its possible extensions.

         In the event of negligence or willful misconduct of the Developer as

         the case may be, the Developer shall be the sole responsible for

         damages or losses incurred to the Lessee or third parties.

 

4.05      SUBLEASING AND ASSIGNMENT OF RIGHTS

 

         The Lessee may only sublease or assign this contract, or the rights

         derived from it to its subsidiaries, or branches, provided that: i) the

         Lessee demonstrates the existing relationship; and ii) the assignee or

         subtenant will not use the Leased Real Estate, or any part thereof, for

         any illegal or undesirable activity. Lessee shall remain jointly and

         severally liable against Lessor and Developer for all obligations in

         this Lease, not limited to monetary terms and conditions. Otherwise,

         the Lessee may not sublease the Leased Real Estate, nor fully or

         partially assign this contract, nor the rights that derive from it,

         except by common agreement with the Developer and Lessor, which has to

         be in writing. The Parties hereby agree, that the Lessor can assign

         totally or partially its rights under this Agreement to Scotiabank de

         Costa Rica, S.A., or any other third party in compliance with the terms

         and conditions of the Trust Agreement, terms and conditions that do not

         affect the validity or the effectiveness of this Agreement. The Lessor

         and the Developer herein acknowledge that the provisions set forth in

         the Trust Agreement does not contravene the terms and conditions of

         this Lease Agreement, in accordance with Article twenty four of the

         Urban and Sub-urban Lease Act in effect

 

4.06      ACQUISITION OF PERMITS

 

         The Lessee shall be responsible to process and acquire all those

         permits necessary for its operation, in addition to the performance of

         activities carried out within the Leased Real Estate, such as, but not

         limited to, those permits and authorizations necessary for operating

         under a free zone regime. In the event that the Developer authorizes

         the realization of renovations or improvements on the property, the

         Lessee shall assume the costs, exclusively, for the permits,

         authorizations and other necessary acts for their execution. The

         Developer shall cooperate with the Lessee in the acquisition of the

         corresponding permits or authorizations whenever its assistance is

         required for this purpose. In case of default by the Lessee of the

         obligation contained herein, it will have a cure period to amend the

         situation as described under section 7.01.

 

4.07      SIGNAGE

 

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         The Lessee shall not place, or allow the placement of signs or notices

         of any type, in any exterior area of the building or common areas of

         the park, other than the clearly designated sites by the Developer for

         these purposes. Moreover, the Lessee shall comply with the signage

         specifications included in the Parque Globals Condominium Bylaws or

         other applicable documents to the Lessee by virtue of the present

         agreement.

 

4.08      NOTIFICATION OF FAILURES OR ACCIDENTS TO THE DEVELOPER

 

         The Lessee shall be required to notify the Developer and the Lessor of

         those failures or accidents occurred in the Leased Real Estate that may

         generate civil, criminal, or tortuous liability, directly or

         indirectly, to the Developer and/or Lessor. The notice of said failures

         or accidents should be made by the Lessee within the ensuing

         twenty-four hours of its knowledge. The notification to the Developer

         and Lessor shall nor cause Lessor or Developer to assume additional

         liabilities than those agreed to in this Lease or those imposed by law.

 

4.09      COMPLIANCE WITH THE LAWS AND APPLICABLE NORMS

 

         The Lessee shall comply with at its own cost and expense, and execute,

         whenever the case, the provisions of any norms, ordinances, rules,

         orders, acts, regulations, and requirements of the legal system in

          effect applicable to the activities the Lessee shall perform in the

         Leased Real Estate. In particular, but not limited to, it shall comply

         with the corresponding and applicable provisions stated in the Law of

         the Free Zone Regime and its regulations, as well as the Customs Law

         and its regulations. The Lessee shall exclusively bear all expenses

         resulting from the compliance with the legal and judicial system in

         effect.

 

4.10      PROHIBITION OF COMMON AREAS OBSTRUCTION

 

         The obstruction of common areas of the Industrial Park with equipment,

         vehicles, machinery, raw material or any other goods owned by the

         Lessee or his/her contractors, employees, dependents or visitors, or

         any other person related with him/her, is expressly prohibited. The

         Lessee must always supervise that common areas are free from

         obstructions caused by any of the persons mentioned in this clause.

         Particularly, the parking of vehicles owned by the Lessee's personnel

         or visitors in the main streets of the Park, is expressly prohibited.

         The Lessee accepts to pay a twenty-dollar fine, plus the cost of the

         obstruction removal resulting from the non-compliance with this

         provision. The amount corresponding to the fine shall be charged in the

         rent corresponding to the next month.

 

4.11      PROHIBITION OF TRANSIT AREAS OBSTRUCTION

 

         Sidewalks, entrances, passageways, elevators, stairs, lobbies and other

         common transit areas may not be obstructed, used or occupied

         differently for the entrance

 

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         or exit of machinery, material, equipment, vehicles or persons,

         depending on the case, related with the activities developed by the

         Lessee. The Lessee must guarantee the compliance with this obligation

         on the part of his/her representatives, contractors, employees,

         dependents, visitors, and other related personnel.

 

4.12      DELAYS IN THE RENDERING OF SERVICES

 

         The eventual delay for just cause, or impossibility on the part of the

         Developer to grant a service as indicated per section 4.15, despite

         reasonable efforts, shall not be a reason to exempt the Lessee from the

         obligation to pay Rent or to fulfill any other obligation herein

         established, unless this agreement or the applicable legislation in

         effect expressly indicates or inhibits the operation of the company.

 

4.13      TRANSFER OF MATERIAL, MACHINERY, OR HEAVY EQUIPMENT

 

         The Lessee may not move any equipment, goods or heavy machinery in and

         outside the building without the suitable means to avoid damaging the

         constructions located in the Leased Real Estate, and it must be done in

         coordination with the Developer. Any damage resulting from the movement

         of the goods mentioned in this clause must be repaired by the Lessee

         pursuant to the terms established in clauses 3.04, 4.03, and 4.14 of

         the present Agreement.

 

4.14      COMPENSATION FOR NON-COMPLIANCE WITH THE OBLIGATIONS

 

         The Lessee must compensate the Developer and/or the Lessor for all

         those costs, expenses, responsibilities, losses, damages, trials,

         processes, fines, penalties, complaints, and lawsuits, including the

         costs incurred by the Developer and/or the Lessor resulting from the

         non-compliance on the part of the Lessee with the obligations derived

         from the legal and judicial system and this Agreement.

 

4.15      OTHER COMMITMENTS

 

         The Lessee shall, (a) execute simultaneously a service Agreement with

         the Developer under the terms and conditions currently in effect, and

         (b) the Lessee shall remain as a free zone company.

 

         In addition, if Lessee is a corporation and if at any time during the

         term of this Lease, the corporate shares of Lessee are transferred by

         sale, assignment, bequest, inheritance, operation of law or other

         disposition so as to result in a change in the present control of said

         corporation by the person or persons now owning a majority of said

         corporate shares, Lessee shall notify such event to both Lessor and

         Developer when such transfer occurs. If in the same manner, there is a

         change in the present control of Developer, Developer shall notify

         Lessee of such transfer, when it occurs.

 

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SECTION FIVE: OF THE DEVELOPER'S RIGHTS AND OBLIGATIONS

 

5.01      PAYMENT OF REAL ESTATE AND MUNICIPAL TAXES

 

         The Developer shall pay the applicable municipal and real estate taxes

         for the Real Estate during the term this Agreement.

 

5.02      INSPECTION RIGHT

 

         The Lessor or the Developer reserves the right to visit the Real Estate

         any moment, provided that it informs the Lessee at least twenty-five

         (25) hours in advance. Inspections referred in this clause must be done

         by the Developer, during Lessee's working hours, through its officers

         or third parties hired to that effect. Exceptionally, with prior

         authorization by the Lessee, inspections may be carried out off the

         regular working hours. Lessor and Developer shall comply with Lessee's

         security precautions and health and safety requirements during any such

         entry.

 

5.03      OWNERSHIP OF THE GOODS LEFT IN THE REAL ESTATE

 

         After eight working days of the termination date of the present

         Agreement, for any cause imputable or not to the Lessee, or in case of

         eviction for non-compliance with the payment, any goods owned by the

         Lessee found inside the Real Estate or in the common areas of the Park

         shall be considered abandoned by the Lessee. Therefore, the Developer

         may take possession of the same. The Lessee resigns as of this moment

         any right to complain related with such circumstance.

 

5.04      SHOWING OF FACILITIES

 

         If any of the Parties notifies the other Party of its intent not extend

         the term of this Agreement as established in section 3.01, the

         Developer shall have the right to show the Real Estate to people

         interested in leasing or purchasing it, during the last six months of

         the Initial Term or Extended Term then in effect. The visits to show

         the Real Estate must be scheduled by the Developer within Lessee's

         working hours, with a previous oral communication to the Lessee.

 

5.05      ENTRY RIGHT ON THE PART OF THE DEVELOPER TO REPAIR DAMAGES

 

         The Developer, its employees or contractors, shall have the right to

         enter the Real Estate in order to make repairs that might correspond to

         it, in accordance with this Agreement and the legislation in effect.

         Nevertheless, the Developer must previously coordinate with the Lessee

         the time in which such repairs shall take place, trying as far as

         possible, and pursuant to the particularities of the repair, that its

         execution must be done on the less prejudicial moment for the normal

         functioning of the Lessee's activities.

 

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5.06      RIGHT OF SALE OF THE REAL ESTATE

 

          The Lessor shall be empowered to sell the Leased Real Estate to an

         interested third party during the terms of legal effect of the present

         Agreement -upon receipt of written instructions of the main beneficiary

         and the Developer.

 

5.07      RELEASE OF LIABILITY IN CASE OF ACCIDENTS/ MUTUAL INDEMNITY

 

         The Lessee releases the Developer and the Lessor from any

         responsibility for any accidents resulting from electricity, flood, gas

         or any other phenomena resulting or not from the Real Estate usage,

         unless such were caused by the gross negligence or willful misconduct

         of the Developer. Developer shall indemnify, defend, protect and hold

         harmless Lessee from all damages, liabilities, claims, judgments,

         actions, attorneys' fees, consultants' fees, costs and expenses arising

         from the breach of its obligations or representations under this Lease

         as well as the negligence or willful misconduct of Developer or its

         agents, contractors, employees or invitees. Lessee shall indemnify,

         defend, protect and hold harmless Lessor and Developer from all

         damages, liabilities, claims, judgments, actions, attorneys' fees,

         consultants' fees, costs and expenses arising from the negligence or

         willful misconduct of Lessee or its agents, contractors, employees or

         invitees, or the breach of Lessee's obligations or representations

         under this Lease. No party shall be liable to any other party under

         this Lease for consequential damages (loss of profits etc).

 

5.08      RELEASE OF LIABILITY IN CASE OF ROBBERY OR THEFT

 

         The Lessee discharges the Developer and the Lessor from any

         responsibility for robbery or theft in the Real Estate, unless the same

         was caused by negligence or imprudence, as defined under the Civil Code

         of the Republic of Costa Rica, on the part of the Developer or the

         security company contracted by the Developer.

 

5.09      NON WAIVER OF RIGHTS

 

         The circumstance that the Developer or the Lessor does not demand the

         compliance with any of the terms and conditions herein established, may

         not be considered as a waiver to the rights and actions granted by

         means of the present Agreement or the legislation applicable to the

         case.

 

5.10      NON-COMPLIANCE ON THE PART OF THE LESSEE

 

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<PAGE>

 

         The lack of payment within the first ten natural days of the rent or

         any other payment responsibilities of the Lessee or the non-compliance

         with any of the clauses stated under clause 6.01 shall give reasons to

         consider the Lease Agreement as rescinded and eviction action shall

         proceed, in which case the Lessee must recognize the damages and

         prejudices he/she might have caused and the cost of any eventual

         judicial actions subject to applicable law. Lessee will receive a

         written notification from the Developer before Developer starts the

         eviction process.

 

5.11      INSURANCE

 

         The Lessee shall have an All Risk insurance to protect the goods of

         his/her property inside the offices. The Developer, on the other hand,

         shall have All Risk insurance that includes the coverage against

         earthquake, fire, and any other damage resulting from nature to protect

         the Real Estate and other related civil works. Both, the Developer as

         well as the Lessee, shall maintain their insurance at replacement

         values. In such insurance, there shall not be a subrogation right on

         the part of the insurers against the Developer or Lessee, as long as

         this is acceptable for the INS or the corresponding insuring entity.

         Neither the Developer, the Lessor nor the Lessee shall cover the

         deductibles of the other party, in case of loss.

 

SECTION SIX: RIGHT OF FIRST REFUSAL

 

6.00 PREFERENCE

 

         The Developer agrees to grant the Lessee a preference right to acquire

         the Real Estate in case any other third party is interested in buying

         the Real Estate (the "Right of First Refusal").

 

6.01      TERM

 

         The term of the Right of First Refusal will be eighteen (18) months,

          after which the Developer will be entitled to sell the Real Estate

         without giving any preference right to the Lessee (the "Preference

         Term"). After the term of the Right of First Refusal (eighteen months)

         the Developer will be entitled to sell the Leased Real Estate to a

         third party and will send a written notification to the Lessee within a

         week of its decision.

 

6.02      NOTIFICATION OF THIRD PARTY OFFERS

 

         If the Developer has offered to sell the acquired Real Estate, it shall

         communicate its intention to the Lessee in writing. If within the

         Preference Term the Developer has received offers to buy the Real

         Estate by third parties, it shall attach or include in a written

         communication to the Lessee the terms and conditions of these offers.

         The Developer guaranties that it will disclose to the Lessee all of the

         offers that it receives from the time the Lessee decides to sell, up to

         the expiration of the period contained in this subsection for the

         exercise of this Right of First Refusal. The Lessee will then have

         fifteen (15) calendar days following the communication from

 

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<PAGE>

 

         the Deveioper to make a decision regarding the purchase of the Real

         Estate. At the express and written communication from the Lessee, or if

         after the fifteen-day period expires without the Lessee making a firm

         commitment to match the terms and conditions of the best option to

         purchase the Real Estate, the Lessee will be construed as having waived

         its Right of First Refusal, and the Real Estate may be offered and sold

         to any third parties.

 

SECTION SEVEN: TERMINATION OF THE AGREEMENT

 

7.0 MOMENT OF TERMINATION

 

         The Lessee shall remain obligated to pay the corresponding lease as

         long as it does not return the Real Estate's keys in the same domicile

         indicated for the payment, even if it has vacated the same.

 

7.01      TERMINATION IN ADVANCE ON THE PART OF THE LESSOR AND THE DEVELOPER.

 

         The Lessor and the Developer may terminate the present Agreement at

         any moment due to non-compliance on the part of the Lessee with the

         obligations established on clauses 3.00, 4.00, 4.03, 4.06, and 4.09 or

         any other cause expressly authorized by the legislation in effect

         ("Events of Default"). Once the Lessor and/or the Developer detect an

         Event of Default, it will communicate so in writing to the Lessee. The

         Lessee will have fifteen (15) working days ("Cure Period") subsequent

         to the receipt of the communication to remedy the situation that is

         causing the Event of Default. With exception of the obligation

         stipulated in clause 3.00 of this Lease, if Lessee can not reasonably

         cure such Event of Default, the Cure Period can be extended, to

         Developer's reasonable discretion, so long as Lessee has commenced the

          cure within the fifteen (15) day period and diligently prosecutes it to

         completion, for a time not exceeding a fifteen (15) day period. If the

         Lessee does not amend the situation during the Cure Period or gives a

         satisfactory response to the Developer, at least requesting an

         extension of the Cure Period, and if it is unreasonable, the Lessor and

         the Developer will be entitled to terminate this Agreement with

         responsibility for the Lessee, and the Developer will recover from them

         a satisfactory indemnification in accordance with clause 6.02.

 

7.02      TERMINATION IN ADVANCE ON THE PART OF THE LESSEE

 

         In case the Lessee wishes to terminate in advance the present lease

         Agreement, it must give prior notice in writing to the Lessor and/or

         the Developer within six months in advance of the expected termination

         date. As indemnification for the termination in advance of the

         Agreement, Lessee shall pay the totality of the monthly rental fees

         owed in relation to the original term of the lease agreement,

         stipulated in article 3.01 of this Agreement. Additionally, the

         Developer shall be

 

Page 15 of 20

<PAGE>

 

         entitled to retain the total sum of the security deposit without any

         objection by the Lessee.

 

(56)7.03 DAMAGE AND DESTRUCTION

 

         (57)Developer shall have the obligation to reconstruct the Leased Real

         Estate: i) if damaged or destructed from a casualty covered by

         insurance required to be carried by Developer under the Lease and the

         amount agreed to be pay by the insurer entity is equal or higher than

         eighty percent (80%) of the estimated reconstruction value; or, ii) if

          the damage is relatively minor (e.g., repair or restoration would take

         fewer than ninety (90) days or would cost less than twenty percent

         (20%) of the replacement cost of the Leased Real Estate, or (iii) if

         Lessee agrees to pay the cost of repair in excess of pre-agreed base

         amount. In the event of damage to the Leased Real Estate, Developer

         shall notify Lessee within fifteen (15) business days following any

         such damage to or destruction of the Leased Real Estate the length of

         time Developer reasonably estimates to be necessary for repair or

         restoration. Lessee shall have the right to terminate the Lease within

         fifteen (15) days following receipt of such notice if restoration or

         repair of the Leased Real Estate will take more than ninety (120) days.

         In the event of any damage or destruction, Rent shall be equitably

         abated during any restoration period.

 

(58)7.04 CONDEMNATION

 

         (59) In the event the Leased Real Estate or any portion thereof is

         condemned or other wise taken by any governmental authority or third

         party such that there is material interference with Lessee's operations

         in the Leased Real Estate (as reasonably determined by Lessee) and such

         taking lasts for a period of ninety (90) days or longer, Lessee shall

         have the right to terminate this Lease by written notice to Lessor. In

         the event that Lessee chooses not to so terminate this Lease, Rent

         shall be equitably abated until such interference is eliminated.

 

SECTION EIGHT: FINAL AND MISCELLANEOUS PROVISION

 

8.0       COMMUNICATIONS AND NOTICES

 

         Any notice that the Parties are required to make in accordance with

          this Agreement, shall be made in writing by means of a personal

         delivery or any other written means, in which the remission and

         reception date are irrefutably recorded, and sent to the following

         addresses and during office hours. Notices shall be deemed delivered on

         reception date.

 

         a) To the Lessor:            At Forum Business Center, Prospero

                                     Fernandez Highway, Santa Ana, Costa Rica.

                                      Attention: Alfonso Amen Chen

                                     Fax number. (506) 204-3141

 

         b) to the Developer:         At the administrative offices of Global

                                     Park, located in La Aurora de Heredia, to

 

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<PAGE>

 

                                     the attention of Caries Wong. Fax number

                                     (506) 209-5960.

 

         c) To the Lessee:            At Novacept 1047 Elwell Court, Palo Alto

                                      California 94303 to the attention of Chief

                                     Financial Officer at fax number (650) 335-

                                     2716.

 

                                     At Novacept building located in Global

                                     Park.

 

8.01      GOVERNING LAW AND DISPUTE RESOLUTION

 

         This Agreement shall be interpreted and governed in general by the laws

         of the Republic of Costa Rica and in particular by the General Urban

          and Suburban Lease Law in effect in Costa Rica.

 

         According to the Law "Ley sobre Resolucion Alterna de Conflictos y

         Promocion de la Paz Social" No. 8828, approved on December 4th., 1998

         and published on January 14th, 1998 in the Official Newspaper "La

         Gaceta" , particularly but not limited to article 22, it is accepted by

         the Parties that this Agreement shall be interpreted and governed by

         the laws of the Republic of Costa Rica.

 

         Any dispute or claim ("The Dispute") with respect to the validity,

         construction or enforceability of this Agreement or arising out of or

         in relation to this Agreement, or for the breach hereof shall be

         initially resolved by the Parties in good faith within 30 Days ("the

         Initial Period") from the day of notice by any of the Parties to the

         other Party as to the existence of a dispute or claim. If the Parties

         are unable to settle The Dispute within the period of time indicated

         before, the Dispute shall be finally settled by arbitration in Costa

         Rica by three arbitrators selected in accordance with the commercial

         arbitration rules of the Conciliation and Arbitration Chamber of the

         Costa Rican Chamber of Commerce. All rules of the Conciliation and

         Arbitration Chamber of the Costa Rican Chamber of Commerce shall apply

         to the arbitration and the arbitration process and for purposes of

         article 19 of Law 8828 it is agreed that, under such Law, the

         arbitration shall be considered an arbitration of law. The arbitrators

         should decided which party should be liable for the payment of all

         costs, expenses and fees related to the arbitration. Any such

         arbitration shall be conducted in the Spanish language.

 

         The arbitration award shall be well founded, in writing and shall be

         final and shall not be subject to appeals of any type, with the

         exemption of the revision and nullity appeals, according to the rules

         of the Costa Rican Chamber of Commerce.

 

8.02      AMENDMENTS TO THE AGREEMENT

 

         Any agreed modifications to the present Agreement must be done in

         writing and signed by the Parties. This clause shall be of special

         application for anything related with the lease price and its form of

         payment; therefore, no modification may be alleged, unless the previous

         procedure is followed.

 

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<PAGE>

 

8.03      ESTIMATION

 

         The present Agreement is estimated in the sum of one hundred ninety

         seven thousand and four dollars (US$197,004.00) legal currency of the

         United States.

 

8.04      NOTARIZATION

 

         The Parties authorize reciprocally to notarize the present lease

         Agreement; nevertheless, the other party must receive a copy of the

         respective testimony.

 

8.05      VESTED RIGHTS

 

         The Lessee recognizes that the present Agreement shall not create any

         right of use in his/her favor, or any equivalent one in virtue of which

         the eventual increase in the commercial value of the real estate shall

         be recognized for its use or occupation, and that in case such rights

         ever arose in reason of the legal applicable disposition or commercial

         practice, he/she transfers it, as of now, to the Lessor in the sum of

         one dollar, legal currency of the United States of America. The Lessee

         recognizes that this provision is essential to fix the intention on the

         part of the Lessor to subscribe the present Agreement.

 

8.06      HEADINGS

 

         The titles used as headings for each clause and chapter of this

         Agreement are introduced to ease its reading and shall not be

         considered as part of the text thereof, to interpret its contents.

 

8.07      INCORPORATION OF EXHIBITS

 

         The Exhibits identified in this Agreement are incorporated herein by

         reference and made a part hereof.

 

8.08      SURVIVAL

 

         All indemnities contained in any section of this Agreement shall

         survive the expiration or other termination of this Agreement with

         respect to acts or events occurring or alleged to occur during the term

         of this Agreement and are expressly made for the benefit of, and shall

         be enforceable by any or all of the indemnified Parties.

 

8.09      SEVERABILITY

 

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<PAGE>

 

         If any of the provisions of this Lease shall contravene or be invalid

          under the laws of the country, province, municipal, state or

         jurisdiction where it is applied, such contravention or invalidity

         shall not invalidate the Lease or any other portions thereof and the

         remainder of this Lease or the application thereof to other persons or

         circumstances shall not be affected thereby.

 

8.10      RECORDATION.

 

         Subsequent to execution, any party may at its sole discretion and

         expense, register this Lease and all Exhibits thereto in the National

         Public Registry of Costa Rica.

 

8.11      ASSIGNMENT TO LOCAL ENTITY

 

The Lessee hereby represents that it is in the process of incorporating a Costa

Rican corporation through which Lessee local operations will be carried out.

Once the incorporation process of such local subsidiary is completed, the Lessee

shall assign the rights and obligations under this Lease to such local entity.

Lessee shall notify Lessor and Developer and provide supporting documentation of

such assignment.

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the

date first above written.

 

(SIGNATURE PAGE FOLLOWS)

 

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<PAGE>

/s/ [ILLEGIBLE]

-------------------------------------

By/ KPMG Fides (Costa Rica), S.A.

Lessor

 

/s/ Donald R. Nathe May 20, 2003

-------------------------------------

By/ Novacept

Lessee

 

/s/ [ILLEGIBLE] May 20, 2003

-------------------------------------

By/ Global Park, S.A.

Developer

 

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<PAGE>

 

                                  EXHIBIT LIST

 

Exhibit One            Building Description & Layouts

 

Exhibit Two            Condominium Regulations CC&Rs

 

Exhibit Three          Waste Water Treatment Plant Regulations

 

<PAGE>

 

                                   EXHIBIT ONE

                        BUILDING DESCRIPTION AND LAYOUTS

 

<PAGE>

 

                                   EXHIBIT TWO

                             CONDOMINIUM REGULATIONS

 

<PAGE>

 

Yo, Michelle Coffey Martinez, traductora oficial autorizada por el Ministerio de

Relaciones Exteriores y Culto de la Republica de Costa Rica, nombrada por el

Acuerdo No. 42 del 5 de enero de 1982, por este medio certifico que en el

idioma ingles el documento por traducir, que consta de cuarenta y siete (47)

paginas, que recibi por e-mail de la Srta. Irene Chinchilla, Gerente de Ventas

de Global Park, S.A., del idioma espanol dice lo siguiente:

 

San Jose, Setiembre 28, 2002.

 

                                Beginning of Text

 

TWELFTH: CONDOMINIUM AND MANAGEMENT BYLAWS: in compliance with Articles

Thirty-Three and Thirty-Four of THE LAW, the Condominium and Management Bylaws

of CONDOMINIO GLOBAL are constituted, which shall regulate the relations of the

condominium owners: DEFINITIONS. The following words will be understood, for all

of the purposes of this Bylaws, according to their respective definitions, to

whit: ADMINISTRATOR: The individual or corporation named to exercise the

management of the Condominium according to the procedures described in this

Bylaw; SHARED AREAS OR ELEMENTS: Shared elements should be understood as all

those zones that are set aside for shared use and enjoyment, within which we can

mention the following, without restriction: green areas, spaces set aside for

pedestrian circulation, sidewalks, streets, access ways, surveillance posts,

electrical substations, water reservoir tank, drinking water systems, fire

extinguisher systems, treatment plant, pump station, control booth, as well as

those which are stipulated as such by Law, the building blueprints and the

Condominium deed of constitution; RESTRICTED USE SHARED AREA: These will be

those shared areas that the Condominium Owners' General Meeting shall determine

by a vote of two-thirds of the total value of the Condominium, which shall be

used only by one or multiple specific joint owners as a result of their

industrial or commercial operational needs within the Condominium, resulting

from the

 

<PAGE>

 

location of the shared area or because of any circumstance which in the judgment

of the Owners' General Meeting justifies that the use and enjoyment of the

shared area be restricted to one or several specific joint owners, either

through a direct request made to the Meeting or because the Meeting so decides.

BUILDING COMMITTEE: The official body designated by the Condominium Owners'

General Meeting to approve, inspect and regulate construction within the

Condominium and within its subsidiary areas and the Independent Condominiums,

which shall ensure compliance with the architectural, urban, building,

structural, esthetic and landscape standards of the Condominium and the

Independent Condominiums, over which it shall also exercise all of its

attributes. THE CONDOMINIUM: Condominio Global. INDEPENDENT CONDOMINIUM: That

which shall be formed by subjecting each subsidiary property of Condominio

Global to the Condominium Property System. The independent condominium bylaw

will be subject to the stipulations of the Condominio Global Bylaw, and to the

Building Bylaw, and will be subject to the Building Committee of Condominio

Global. CONDOMINIUM JOINT OWNERS: These are the individuals or companies,

who/which reside in the Condominium or not, which hold property title over the

subsidiary properties of the Condominium. In the case in which the subsidiary

property is at the same time the parent property of an independent condominium,

such condominium will be considered a joint owner of Condominio Global and shall

participate in the Meetings and voting of Condominio Global under one single

representation which shall have one single opinion and orientation to vote in

regard to the matters that are heard in each Meeting. ORDINARY AND EXTRAORDINARY

MAINTENANCE FEE: A proportional part of the general expenses that the joint

owners are obligated to cancel and which shall be set

 

<PAGE>

 

according to the square meters of developed private area in each subsidiary

property, i.e., the developed private area within the Condominium's property

coefficient in relation to the Condominium's total area. There shall be no

obligation to pay neither an ordinary nor an extraordinary maintenance fee for

undeveloped private areas. EXECUTIVES: Administrators, legal representatives and

corporate executives in general who are installed in the Condominium. SUBSIDIARY

PROPERTY: Each one of the lots that make up the Condominium, duly identified by

a Lot number, and which shall be subject to different stages of development, all

of which constitute the private areas of the Condominium. SHARED EXPENSES:

Shared expenses will be understood to be those which refer to the management and

maintenance of the Condominium which the joint owners are obligated to

contribute to in a manner which is proportional to the percentage of their

private property with regard to the overall value of the Condominium, i.e., the

percentage that corresponds to their property within the stated total value.

Shared expenses are those which are established by Law, the collection of solid

wastes, security, shared area maintenance, as well as those expenses which are

specified by the Condominium Meeting by recommendation of Condominium Management

in compliance with its obligations. LAW: The Regulating Law of Condominium

Property, Law Number seven thousand nine hundred thirty-three of November

Twenty-Five, Nineteen Ninety-Nine, and its reforms. ADMINISTRATIVE STAFF:

Individuals in general who render personal services to the companies which are

installed in the Condominium or to the Administrator thereof. PROPERTY OF THE

CONDOMINIUM: This is understood to be all of the area described in the Deed of

Constitution of the Condominium which subjects said area to the Condominium

Property

 

<PAGE>

 

System, including all of the corresponding improvements and entitlements

thereto. SERVICE PROVIDER: The individual or company which the Administrator of

the Condominium will be empowered to hire to provide the general services that

the joint owners pay through their maintenance fee. BYLAW: The current

Condominium and Management Bylaw of Condominio Global. BUILDING CODE: The Code

will be established by the Building Committee for the approval, inspection and

regulation of construction within the Condominium, within its subsidiary

properties and Independent condominiums, and shall specify and develop the

architectural, urban, construction, structural, esthetic and landscaping

standards for the Condominium and the Independent Condominiums. AFFILIATED

SUBSIDIARY: The subsidiary properties of the Independent Condominiums. WORKERS:

Individuals in general who render personal service to the companies installed in

the Condominium. VISITORS: These are people who visit the Condominium for any

reason, either invited by Management or by the joint owners, lessees, occupants

or holders, under any title, or those people who work doing repairs,

maintenance, construction, cleaning, or who simply visit, or people looking for

work, with the exception of the administrative personnel and executives and

workers of the companies which are installed in the Condominium. FIRST CHAPTER:

SCOPE AND TERM: FIRST ARTICLE: GENERAL OBLIGATORY NATURE: This Condominium and

Management Bylaw is obligatory on all the joint owners, lessees, occupants or

holders under any title derived from the property in condominium, as well as any

visitors to whom it may apply. Also, it will be obligatory on the successors of

those rights or people who are entitled thereto under any title, lessees or

subleases, as well as anybody, either individual or corporation, who under

private contract or court

 

<PAGE>

 

ruling should acquire the property, possession thereof, the use and enjoyment of

any of the subsidiary properties resulting from the Condominium, which shall be

governed by Law, as well as the terms and conditions of the Deed of Constitution

of the Condominium. Condominio Global is planned in such manner that each one of

its subsidiary properties may be constructed and subjected to different stages

of development which shall be independent one from others, each of which

subsidiary properties shall be capable of being converted into the parent

property of an independent condominium, without thereby losing its nature as a

subsidiary property to the Condominium, in other words, all of the stages of

development will always be connected as part of a general whole which shall

enjoy the same services and shared areas. Consequently, the bylaw of each one of

the independent condominiums which will be constituted by each of the subsidiary

properties shall be in complete harmony and uniformity with this Condominium and

Management Bylaw, which shall be generally applied and abided by the

Condominium, and its stipulations shall prevail in the case of discrepancy,

omission or confusion, over the stipulations of the Condominium and Management

Bylaw of the independent condominiums that are constituted by each one of the

subsidiary properties that make up the Condominium, since they, even if they

become the parent properties of new independent condominiums, shall conserve

their nature as subsidiary properties to Condominio Global. SECOND ARTICLE:

IRREVOCABILITY: Should there exist any reserved private contract subscribed

between the persons indicated in the preceding article which in any manner

modifies, alters, or revokes the legal system established by Law and this Bylaw,

it shall be found null for all purposes and shall lack validity in regard to the

joint owners of the Condominium and in

 

<PAGE>

 

regard to third parties, as well as any stipulation of the internal management

regulation of each one of the Independent condominiums which may be constituted

by the subsidiary properties of the Condominium which modify, alter, revoke the

stipulations of this Bylaw. Expressly excluded from this provision are the

documents that are mentioned in the Twenty-Ninth Article of this Bylaw, which

are acknowledged as valid and binding on all the joint owners. THIRD ARTICLE:

REFORMS: This Bylaw shall be duly approved and enter in effect from the moment

in which the Condominium is registered in the Public Registry. Any reform to

this Bylaw, as well as the emission of new text shall correspond solely and

exclusively to the Condominium Owners' General Meeting, by unanimous decision of

all the Condominium owners, according to the provision of Article Twenty-Seven,

Paragraph 5, of the Law. In accordance with the above, any reform or draft of a

new Bylaw must be verified by public deed and registered in the Public Registry,

if such procedure is possible. SECOND CHAPTER. PRIVATE ASSETS AND SHARED ASSETS.

- PRIVATE ASSETS: The Condominium consists of thirteen subsidiary properties

which are described as land for the construction of office buildings, industrial

or commercial units, and which make up the private area of the Condominium. Each

one of the subsidiary properties has been identified by means of a lot number,

as appears on the corresponding blueprint as well as in the deed of

constitution. The joint owners acquire, together with the subsidiary or private

assets, the right to use the shared elements that are defined by Law and this

Bylaw, as well as those entitlements and obligations which are acknowledged and

imposed by this Bylaw. In such manner that each one of the joint owners may hold

and derive from the entitlement that they may have over the subsidiary property

understood

 

<PAGE>

 

to be the private area, the right to enjoy all of those elements of the

Condominium that are stipulated for shared use and are necessary for its

existence and conservation. FIFTH ARTICLE: SHARED ASSETS: Shared assets will be

understood to be civil infrastructure works, such as: vehicular access ways and

on-site concrete or paved roads, sidewalks and gutters with their respective

curbs, the rainwater runoff system, sanitary waste system, drinking water

system, power distribution and exterior lighting grid, telephone and cable TV

network, irrigation system, waste water treatment plant, green zones and parks,

master power control room, water supply control room, surveillance and vehicular

access control stations, and perimeter fence, as well as any other urban

development required according to law in keeping with the type of industrial or

commercial development to be executed in the Condominium, as well as those set

forth in Article Ten of the Law. the Condominium expressly gives the right of

way through the shared areas to all government and local agencies that govern or

regulate basic public utilities, such as Empresa de Servicios Publicos de

Heredia(1) ESPH, in the case of the private supplier of water and power service,

the Costa Rican Institute of Electricity ICE, Costa Rican Institute of Aqueducts

and Sewers AyA, Radiografica Costarricense S.A.(2) RACSA, and any other data

communications or general services company of the Condominium which may have

been previously approved and contracted by Management or by the Condominium

Owners' General Meeting to execute work necessary for the operation and

maintenance of the shared areas. Likewise and under Article Twenty-Seven of the

Law, shared assets will be those which are qualified as such by the Condominium

Owners' General Meeting, even if they are

 

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(1) TN - Heredia Public Utilities


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