OFFICE LEASE AGREEMENT

I.

BASIC LEASE INFORMATION

1

II.

LEASE GRANT

5

III.

POSSESSION OF THE PREMISES AND RENT COMMENCEMENT

6

IV.

RENT

7

V.

COMPLIANCE WITH LAWS; USE

14

VI.

SECURITY DEPOSIT

15

VII.

SERVICES

17

VIII.

LEASEHOLD IMPROVEMENTS

18

IX.

REPAIRS, MAINTENANCE AND ALTERATIONS

19

X.

USE OF UTILITY SERVICES BY TENANT

21

XI.

ENTRY BY LANDLORD

22

XII.

ASSIGNMENT AND SUBLETTING

22

XIII.

LIENS

25

XIV.

INDEMNITY AND WAIVER OF CLAIMS

26

XV.

INSURANCE

27

XVI.

SUBROGATION

27

XVII.

CASUALTY DAMAGE

27

XVIII.

CONDEMNATION

29

XIX.

EVENTS OF DEFAULT

30

XX.

REMEDIES

30

XXI.

LIMITATION OF LIABILITY

32

XXII.

NO WAIVER

33

XXIII.

QUIET ENJOYMENT

33

XXIV.

RELOCATION. [INTENTIONALLY OMITTED]

33

XXV.

HOLDING OVER

33

XXVI.

SUBORDINATION TO MORTGAGES; ESTOPPEL CERTIFICATE

33

XXVII.

ATTORNEYS' FEES

34

XXIX.

EXCEPTED RIGHTS

35

XXX.

SURRENDER OF PREMISES

35

XXXI.

MISCELLANEOUS

35

XXXII.

ENTIRE AGREEMENT

39

-i-

I.

Basic Lease Information.

A.

“Building” shall mean the building located at 900 Saginaw Drive, Redwood City, California, and commonly known as 900 Saginaw Drive.

B.

“Buildings of the Campus” shall mean the buildings in Redwood City, California, located at 300 Saginaw Drive, 400 Saginaw Drive, 500 Saginaw Drive, 600 Saginaw Drive, 700 Saginaw Drive, 800 Saginaw Drive and 900 Saginaw Drive. Notwithstanding the foregoing, Landlord and Tenant agree that the definition of Buildings of the Campus may change from time to time in the event Landlord elects to add or remove buildings as more fully described in Section below, in which case Tenant’s Pro Rata Share shall be adjusted as provided in Section I.F below.

C.

“Rentable Square Footage of the Campus” is deemed to be 287,399 square feet. The Rentable Square Footage of the Campus is determined by combining the total building square footages of the Buildings of the Campus.

D.

“Premises” shall mean the area shown on Exhibit   A-1 to this Lease. The Premises are located on the first (1 ^st ) and second (2 ^nd) floors of the Building and known as suite numbers 100 and 200. The “Rentable Square Footage of the Premises” is deemed to be 31,062 square feet, consisting of 20,708 square feet on the first (1 ^st ) floor and known as Suite 100, as more particularly shown on Exhibit A-1 (the “First Floor Premises”), and 10,354 square feet on the second (2 ^nd ) floor and known as Suite 200, as more particularly shown on Exhibit A-1 (the “Second Floor Premises”). If the Premises include one or more floors in their entirety, all corridors and restroom facilities located on such full floor(s) shall be considered part of the Premises, Landlord and Tenant stipulate and agree that the Rentable Square Footage of the Building and the Rentable Square Footage of the Premises are correct and shall not be remeasured. Notwithstanding any limitations on payments of Base Rent for certain portions of the Premises during certain periods of the Term or adjustments to Tenant’s Pro Rata Share as set forth herein, the “Premises” for all other purposes hereunder shall mean the entire Premises effective as of the Delivery Date.

E.

“Base Rent”:

Months of Term

Annual Rate
Per Square Foot

Annual
Base Rent

Monthly
Base Rent

Months 1 – 6

$9.99

$206,872.92

$17,239.41

Months 7 – 24

$13.80

$285,770.40

$23,814.20

Months of Term

Annual Rate
Per Square Foot

Annual
Base Rent

Monthly
Base Rent

Months 25 – 36

$15.00

$465,930.00

$38,827.50

Months 37 – 48

$15.60

$484,567.20

$40,380.60

Months 49 – 60

$16.20

$503,204.40

$41,933.70

F.

“Tenant’s Pro Rata Share” for the Premises (1) for the first six months following the Commencement Date is 5.2192% , (2) for the period commencing on the six month anniversary of the Commencement Date through the day immediately prior to the first day of the twenty-fifth month following the Commencement Date is 7.2053% , and for the period commencing on the first day of the twenty-fifth month following the Commencement Date through the remainder of the Term is 10.8080% . Notwithstanding the foregoing, the parties acknowledge and agree that in the event of Early Occupancy (as defined in Section III.C) of any portion of the Second Floor Premises prior to the Second Floor Rent Commencement Date, Tenant’s Pro Rata Share shall be immediately increased by 0.6959% (in addition to the 5.2192% or 7.2053% set forth above, as applicable), regardless of the number of Rentable Square Feet of the Second Floor Premises that are actually subject to such Early Occupancy, effective as of the first day of such Early Occupancy until the Second Floor Rent Commencement Date, at which time Tenant’s entire Pro Rata Share shall be 10.8080% as set forth above. For example, in the event of Early Occupancy of a portion of the Second Floor

G.

“Term”: A period of 60 months. The Term shall commence on the date (the “Commencement Date”) that is 120 days after the Delivery Date (as defined in Section III.A below) and, unless terminated early in accordance with this Lease, end on the date that is 60 months after the Commencement Date (the “Termination Date”). Notwithstanding the foregoing, if the Termination Date, as determined herein, does not occur on the last day of a calendar month, the Term shall be deemed automatically extended by the number of days necessary to cause the Termination Date to occur on the last day of the last calendar month of the Term. Tenant shall pay Base Rent and Additional Rent for such additional days at the same rate payable for the portion of the last calendar month immediately preceding such extension. At Landlord’s option, promptly after the determination of the Commencement Date, Landlord and Tenant shall enter into a letter agreement confirming the applicable dates substantially in the form attached as Exhibit   C .

H.

Tenant allowance(s): $621,240.00, as more particularly described in the Work Letter attached as Exhibit   D hereto (the “Work Letter”).

I.

“Security Deposit”: $500,000.00, in the form of a Letter of Credit as more particularly described in Article VI.

J.

“Guarantor(s)”: As of the date of this Lease, there are no Guarantors.

K.

“Broker(s)”: Cornish & Carey Commercial.

L.

“Permitted Use”: General office use, research and development and manufacturing of medical devices, all as permitted by law.

M.

“Notice Addresses”:

Landlord:

With a copy to:

CA-Seaport Centre Limited

Equity Office Properties Trust

Partnership

Two North Riverside Plaza

c/o Equity Office Properties Trust

Suite 2100

725 Saginaw Drive

Chicago, Illinois 60606

Redwood City, California 94063

Attention: Regional Counsel – San Francisco Region

N.

“Business Day(s)” are Monday through Friday of each week, exclusive of New Year’s Day, President’s Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day (“Holidays”). Landlord may designate additional Holidays, provided that the additional Holidays are commonly recognized by other office buildings in the area where the Building is located.

O.

[intentionally Omitted]

P.

“Law(s)” means all applicable statutes, codes, ordinances, orders, rules and regulations of any municipal or governmental entity.

Q.

[Intentionally Omitted].

R.

“Property” means the Building and the parcel(s) of land on which it is located and the landscaping, the parking facilities and all other improvements owned by Landlord and serving the Building and the tenants thereof and the parcel(s) of land on which they are located.

S.

“Campus means that certain office project commonly known as Seaport Centre West located on the parcel(s) of real estate outlined on Exhibit   A-2 attached hereto and incorporated herein, which currently includes the buildings located at 300 Saginaw Drive, 400 Saginaw Drive, 500 Saginaw Drive, 600 Saginaw Drive, 700 Saginaw Drive, 800 Saginaw Drive and 900 Saginaw Drive, the Property and the Exterior Common Areas (defined below), and, at Landlord’s option, the parking facilities serving the Campus, all of which are located in the City of Redwood City, County of San Mateo, State of California. Notwithstanding the foregoing, Landlord and Tenant agree that the definition of the Campus may change from time to time in the event Landlord elects to add or remove buildings or parcels of land to or from the Campus. In such event, the definition of “Campus” shall be deemed to be amended without any further action of the parties herein to reflect such addition or deletion of building(s) or parcels of land to or from the Campus, and Tenants Pro Rata Share shall be adjusted as provided in Section l.F above.

T.

“Exterior Common Areas” mean those areas of the Campus and/or the Property which are not located within the Building or any other building and which are provided and maintained for the use and benefit of Landlord and tenants of the Building and/or the Campus generally and the employees, invitees and licensees of Landlord and such tenants, including, without limitation, any parking garage, artificial lakes, walkways, plaza, roads, driveways, sidewalks, surface parking and landscapes (if any).

U.

“Project” means those certain office and/or retail campuses which collectively are commonly known as Seaport Centre located on the parcel(s) of real estate outlined on Exhibit   A-3 attached hereto and incorporated herein, which currently includes the campuses commonly known as Seaport Centre East, Seaport Centre West and the “MetLife Campus”, and the Project Common Areas (defined below), and, at Landlord’s option, the parking facilities serving the Project, all of which are located in the City of Redwood City, County of San Mateo, State of California. Notwithstanding the foregoing, Landlord and Tenant agree that the definition of the Project may change from time to time in the event Landlord elects to add or remove buildings, campuses or parcels of land to or from the Project. In such event, the definition of “Project” shall be deemed to be amended without any further action of the parties herein to reflect such addition or deletion of building(s), campuses or parcels of land to or from the Project.

V.

“Project Common Areas” mean those areas of the Project which are not located within the Campus or any other campus and which are provided and maintained for the use and benefit of landlords and tenants of the Project and/or the Campus generally and the employees, invitees and licensees of the landlords and such tenants, including, without limitation, any island entries to the Project.

II.

Lease Grant.

III.

Possession of the Premises and Rent Commencement.

A.

Tenant shall have the right to take possession of the Premises for purposes of performing the Initial Alterations, as described in the Work Letter, and, with respect to the First Floor Premises (and with respect to the Second Floor Premises subject to the provisions of Section III.C below), for performing business operations, on the date immediately following the date of full and final execution and delivery of this Lease and delivery of all prepaid rental and Security Deposits required hereunder (the “Delivery Date”). In the event that the Delivery Date has not occurred on or before May 1, 2003, Tenant shall have the right to terminate this Lease upon written notice to Landlord delivered no later than May 6, 2003, in which event all sums previously paid by Tenant hereunder shall be promptly returned to Tenant and neither party shall have any further liability hereunder. Such possession after the Delivery Date and prior to the Commencement Date shall be subject to all of the terms and conditions of the Lease, except that Tenant shall not be required to pay Base Rent or Additional Rent with respect to the period of time prior to the Commencement Date during which Tenant occupies the Premises for such purposes. Upon Landlord’s request following the Delivery Date, Tenant shall promptly execute and return to Landlord a “Delivery Letter” in substantially the form of the “Commencement Letter” attached as Exhibit   C hereto, in which Tenant shall agree to acceptance of the Premises and to the determination of the Delivery Date, in accordance with the terms of this Lease, but Tenant’s failure or refusal to do so shall not negate Tenant’s acceptance of the Premises or affect determination of the Delivery Date.

B.

Subject to Landlord’s obligations under Article V and Section IX.B. and to construct the Demising Wall as set forth in Section III.C below, the Premises are accepted by Tenant in “as is” condition and configuration. By taking possession of the Premises, Tenant agrees that the Premises are in good order and satisfactory condition, and that there are no representations or warranties by Landlord regarding the condition of the Premises, the Building, the Campus or the Project. Notwithstanding the foregoing, except to the extent caused by Tenant or any Tenant Related Party, as of the Delivery Date (but expressly excluding the Initial Alterations or any portions of the Premises to the extent such portions are damaged, removed or affected by the Initial Alterations), the base Building electrical, heating, ventilation and air conditioning, mechanical and plumbing systems of the Premises and all currently existing interior improvements shall be in good order and satisfactory condition. If the foregoing are not in good working order as provided above, Landlord shall be responsible for repairing or restoring same at its cost and expense, provided that the foregoing shall not prohibit Landlord from including the cost of routine maintenance and repair of such Building systems in Expenses as otherwise permitted under Article IV hereof.

C.

Tenant shall not commence business operations in any portion of the Second Floor Premises or use any portion of the Second Floor Premises for storage or other significant and persistent Tenant uses (either or both being considered

D.

Landlord shall construct a demising wall (“Demising Wall”) demising the Second Floor Premises from the remainder of the second floor within one (1) year following the Commencement Date. In the event of Early Occupancy, Landlord and Tenant agree to cooperate with each other in order to enable the Demising Wall to be constructed in a timely manner and with as little inconvenience to the operation of Tenant’s business as is reasonably possible. Notwithstanding anything herein to the contrary, any delay in the completion of the Demising Wall, or inconvenience suffered by Tenant during the construction of the Demising Wall in the event of Early Occupancy, shall not delay the Second Floor Rent Commencement Date, nor shall it subject Landlord to any liability for any loss or damage resulting therefrom or entitle Tenant to any credit, abatement or adjustment of Rent or other sums payable under this Lease; provided that Landlord shall diligently pursue completion of the Demising Wall as soon as practicable. Within 15 days following written demand from Landlord and presentment of applicable invoices, Tenant shall reimburse Landlord for fifty percent (50%) of the actual and reasonable cost of the Demising Wall, Tenant’s share thereof not to exceed $10,000.00 (the “Demising Wall Costs”).

IV.

Rent.

A.

Payments . As consideration for this Lease, Tenant shall pay Landlord, without any setoff or deduction, the total amount of Base Rent and Additional Rent due for the Term. “Additional Rent” means all sums (exclusive of Base Rent) that Tenant is required to pay Landlord. Additional Rent and Base Rent are sometimes collectively referred to as “Rent”. Tenant shall pay and be liable for all rental, sales and use taxes (but excluding income taxes), if any, imposed upon or measured by Rent under applicable Law. Base Rent and recurring monthly charges of Additional Rent shall be due and payable in advance on the first (1 ^st ) day of each calendar month without notice or demand, provided that the installment of Base Rent and Tenant’s Monthly Expense and Tax Payment (as defined in Section I.F above) for the first full calendar month of the Term shall be payable upon the execution of this Lease by Tenant. All other items of Rent shall be due and payable by Tenant on or before 30 days after billing by Landlord. Rent shall be made payable to the entity, and sent to the address, Landlord designates and shall be made by good and sufficient check or by other means (such as automatic debit or electronic transfer) acceptable to Landlord. If Tenant fails to pay any item or installment of Rent when due, Tenant shall pay Landlord an administration fee equal to five percent (5%) of the past due Rent, provided that Tenant shall be entitled to a grace period of five (5) Business Days after written notice for the first two (2) late payments of Rent in a given calendar year. If the Term commences on a day other than the first day of a calendar month or

B.

Payment of Tenant’s Pro Rata Share of Expenses and Taxes . Tenant shall pay Tenant’s Pro Rata Share of the total amount of Expenses (defined in Section IV.C.) and Taxes (defined in Section IV.D) for each calendar year during the Term. Landlord shall provide Tenant with a good faith estimate of the total amount of Expenses and Taxes for each calendar year during the Term. On or before the first (1 ^st ) day of each month, Tenant shall pay to Landlord a monthly installment equal to one-twelfth of Tenant’s Pro Rata Share of Landlord’s estimate of the total amount of Expenses and Taxes, which initial monthly sum is defined in Section I.F, above as the “Tenant’s Monthly Expense and Tax Payment”. If Landlord determines that its good faith estimate was incorrect by a material amount, Landlord may provide Tenant with a revised estimate. After its receipt of the revised estimate, Tenant’s Monthly Expense and Tax Payment shall be based upon the revised estimate. If Landlord does not provide Tenant with an estimate of the total amount of Expenses and Taxes by January 1 of a calendar year, Tenant shall continue to pay monthly installments based on the previous year’s estimate until Landlord provides Tenant with the new estimate. Upon delivery of the new estimate, an adjustment shall be made for any month for which Tenant paid monthly installments based on the previous year’s estimate. Tenant shall pay Landlord the amount of any underpayment within 30 days after receipt of the new estimate. Any overpayment shall be refunded to Tenant within 30 days or credited against the next due future installment(s) of Additional Rent.

C.

Expenses Defined . “Expenses” means the sum of (a) all direct and indirect costs of operating, maintaining, repairing and managing the Building, the Property and the Campus (including any costs and expenses in connection with operating, maintaining, repairing and managing the Exterior Common Areas), (b) all costs, fees or other amounts payable to any association established for the benefit of the Campus and/or other properties, and (c) all fees payable to the company or association, if applicable, managing the parking areas within the Campus, and (iii) the Building’s, the Property’s, the Campus’ and the Landlord’s allocable percentage of (x) all direct and indirect costs of operating, maintaining, repairing and managing the Project (including any costs and expenses in connection with operating, maintaining, repairing and managing the Project Common Areas located on the Project to the extent such costs and expenses are not specifically allocated to and payable by individual buildings and campuses within the Project), (y) all costs, fees or other amounts payable to any association established for the benefit of the Project and/or other properties, and (z) all fees payable to the company or association, if applicable, managing the parking areas within the Project including, but not limited to:

1.

Labor costs, including, wages, salaries, social security and employment taxes, medical and other types of insurance, uniforms, training, and retirement and pension plans; provided that if any employee performs services in connection with the Campus and other buildings or projects, costs associated with such employee may be proportionately included in Expenses based on the percentage of time such employee spends in connection with the operation, maintenance and management of the Campus.

2.

Management fees, the cost of equipping and maintaining a management office, accounting and bookkeeping services, legal fees not attributable to leasing or collection activity, and other administrative costs. Landlord, by itself or through an affiliate, shall have the right to directly perform or provide any services under this Lease (including management services), provided that in no event shall Landlord, such affiliates or any third party be paid for such services in excess of three percent (3%) of the gross receipts for the Campus.

3.

The cost of services, including amounts paid to service providers and the rental and purchase cost of parts, supplies, tools and equipment.

4.

Premiums and deductibles paid by Landlord for insurance, including workers compensation, fire and extended coverage, earthquake, general liability, rental loss, elevator, boiler and other insurance customarily carried from time to time by owners of comparable office buildings.

5.

Electrical Costs (defined below) and charges for water, gas, steam and sewer, but excluding those charges for which Landlord is reimbursed by tenants. “Electrical Costs” means: (a) charges paid by Landlord for electricity; (b) costs incurred in connection with an energy management program for the Building, the Property, the Campus or the Project; and (c) if and to the extent permitted by Law, a fee for the services provided by Landlord in connection with the selection of utility companies and the negotiation and administration of contracts for electricity, provided that such fee shall not exceed 50% of any savings obtained by Landlord. Electrical Costs shall be adjusted as follows: (i) amounts received by Landlord as reimbursement for above standard electrical consumption shall be deducted from Electrical Costs; (ii) the cost of electricity incurred to provide overtime HVAC to specific tenants (as reasonably estimated by Landlord) shall be deducted from Electrical Costs; and (iii) if Tenant is billed directly for the cost of building standard electricity to the Premises as a separate charge in addition to Base Rent, the cost of electricity to individual tenant spaces in the Building shall be deducted from Electrical Costs.

6.

The amortized cost of capital improvements (as distinguished from replacement parts or components installed in the ordinary course of business) made to the Building, Property, Campus or Project which are: (a) performed primarily to reduce operating expense costs or otherwise improve the operating efficiency of the Building, Property, Campus or Project; or (b) required to comply with any Laws that are enacted, or first interpreted to apply to the Building, Property, Campus or Project, after the date of this Lease. The cost of capital improvements shall be amortized by Landlord over the lesser of the Payback Period (defined below) or 5 years. The amortized cost of capital improvements may, at Landlord’s option, include actual or imputed interest at the rate that Landlord would reasonably be required to pay to finance the cost of the capital improvement. “Payback Period” means the reasonably estimated period of time that it takes for the cost savings resulting from a capital improvement to equal the total cost of the capital improvement. Notwithstanding the foregoing, the portion of the annual amortized costs to be included in Expenses in any calendar year with respect to a capital improvement which is intended to reduce expenses or improve operating efficiency shall equal the lesser of: (a) such annual amortized costs; and (b) the projected annual amortized reduction in expenses for that portion of the amortization period of the capital improvement which falls within the Term (based on the total cost savings for such period, as reasonably estimated by Landlord).

7.

Any fees, costs and expenses relating to operating, managing, owning, repairing and maintaining the parking facilities servicing the Building, the Property, the Campus and the Project, and any fitness center(s), conference center(s), shuttle service(s) or other amenities in the Campus and the Project, but only to the extent such facilities are available to Tenant.

(a)

Repairs or other work occasioned by: (i) fire, windstorm, or other casualty of the type which Landlord has insured (to the extent that Landlord has received insurance proceeds and provided that the amount of any deductible paid by Landlord shall be included in Expenses); or (ii) the exercise of the right of eminent domain (to the extent that such repairs or other work are covered by the proceeds of the award, if any, received by Landlord);

(b)

Rental concessions granted to specific tenants and expenses incurred in renovating or otherwise improving or decorating, painting, or redecorating space for specific tenants or other occupants, other than ordinary repairs and maintenance provided or available to tenants in general;

(c)

Overhead and profit increment paid to subsidiaries or other affiliates of Landlord for services on or to the Premises, Building and/or Campus to the extent only that the costs of such services exceed the competitive cost for such services rendered by persons or entities of similar skill, competence and experience;

(d)

The cost of services that are not available to Tenant under this Lease or for which Tenant reimburses Landlord as a separate charge (other than through Expenses);

(e)

Advertising and promotional expenditures;

(f)

Costs, fines, interest, penalties, legal fees or costs of Litigation incurred due to the late payments of taxes, utility bills and other costs incurred by Landlord’s failure to make such payments when due unless such failure is

(g)

Accounting fees to the extent relating to Landlord’s general corporate overhead;

(h)

Any penalties or liquidated damages that Landlord pays to Tenant under this Lease or to any other tenants in any of the Buildings on the Campus under their respective leases;

(i)

Attorney’s fees, costs and disbursements and other expenses incurred in connection with negotiations or disputes with tenants or other occupants of any of the Buildings on the Campus or with prospective tenants (other than attorney’s fees, costs and disbursements and other expenses incurred by Landlord in seeking to enforce rules and regulations for any of the Buildings on the Campus);

(j)

Any cost or expense related to removal, cleaning, abatement or remediation of Hazardous Materials in or about the Building, Campus, Property or Project, except to the extent such removal, cleaning, abatement or remediation is related to the routine repair and maintenance of the Building, Campus, Property or Project, and further provided that this provision shall not limit or affect Tenant’s express obligations with respect to Hazardous Materials and the Generator and Fuel Tank as set forth elsewhere in this Lease; and

(k)

The cost of complying with any Laws in effect (and as enforced) on the Delivery Date, provided that if any portion of the Building that was in compliance with all applicable Laws on the Commencement Date becomes out of compliance due to normal wear and tear, the cost of bringing such portion of the Building into compliance shall be included in Expenses unless otherwise excluded pursuant to the terms hereof, and further provided that this provision shall not limit or affect Tenant’s express obligations with respect to Hazardous Materials and the Generator and Fuel Tank as set forth elsewhere in this Lease.

D.

Taxes Defined . “Taxes” shall mean: (1) all real estate taxes and other assessments on the Building, the Property, the Campus and the Project, including, but not limited to, assessments for special improvement districts and building improvement districts, taxes and assessments levied in substitution or supplementation in whole or in part of any such taxes and assessments and the

E.

Net Lease . This shall be a triple net Lease and Base Rent shall be paid to Landlord absolutely net of all costs and expenses, except as specifically provided to the contrary in this Lease. The provisions for payment of Expenses and Taxes and the determination of Tenant’s Monthly Expense and Tax Payment are intended to pass on to Tenant and reimburse Landlord for all costs and expenses of the nature described in this Article IV incurred in connection with the ownership, management, maintenance, repair, preservation, replacement and operation of the Building, Campus and/or Project and its supporting facilities and such additional facilities now and in subsequent years as may be determined by Landlord to be necessary or desirable to the Building, Campus and/or Project.

F.

Audit Rights . Tenant may, within 180 days after receiving Landlord’s statement of Expenses, give Landlord written notice (“Review Notice”) that Tenant intends to review Landlord’s records of the Expenses for that calendar year. Within a reasonable time after receipt of the Review Notice, Landlord shall make all pertinent records available for inspection that are reasonably necessary for Tenant to conduct its review. If any records are maintained at a location other than the office of the Campus, Tenant may either inspect the records at such other location or pay for the reasonable cost of copying and shipping the records. If Tenant retains an agent to review Landlord’s records, the agent must be with a licensed CPA firm. Notwithstanding the foregoing, Landlord agrees that Tenant may retain a third party agent to review Landlord’s books and records which is not a CPA firm, so long as the third party agent retained by Tenant shall have expertise in and familiarity with general industry practice with respect to the operation of and accounting for a first class office building and whose, compensation shall in no way be contingent upon or correspond to the financial impact on Tenant resulting from the review. Tenant shall be solely responsible for all costs, expenses and fees incurred for the audit. However, notwithstanding the foregoing, if Landlord and Tenant determine that Expenses for the Building for the year in question were less than stated by more than 5%, Landlord, within 30 days after its receipt of paid invoices therefor from Tenant, shall reimburse Tenant for the reasonable amounts paid by Tenant to third parties in connection with such review by Tenant. Within 60 days after the records are made available to Tenant, Tenant shall have the right to give Landlord written notice (an “Objection Notice”) stating in reasonable detail any objection to Landlord’s statement of Expenses for that year. If Tenant fails to give Landlord an Objection Notice within the 60 day period or fails to provide Landlord with a Review Notice within the 180 day period described above, Tenant shall be deemed to have approved Landlord’s statement of Expenses and shall be barred from raising any claims regarding the Expenses for that year. If Tenant provides Landlord with a timely Objection Notice, Landlord and Tenant shall work together in good faith to resolve any issues raised in Tenant’s Objection Notice. If Landlord and Tenant determine that Expenses for the calendar year are less than reported, Landlord shall provide Tenant with a credit against the next installment of Rent in the amount of the overpayment by Tenant. Likewise, if Landlord and Tenant determine that Expenses for the calendar year are greater than reported, Tenant shall pay Landlord the amount of any underpayment within 30 days. The records obtained by Tenant shall be treated as confidential, except to the extent required by law, legal process between the parties in connection with Tenant’s audit of Expenses, and provided that such information may be shared by Tenant with Tenant’s lenders, investment brokers, advisors, accountants and attorneys to the extent reasonably necessary for the conduct of Tenant’s business, provided that Tenant shall use commercially reasonable efforts to cause such parties to keep such information confidential, in no event shall Tenant be permitted to examine Landlord’s records or to dispute any statement of Expenses unless Tenant has paid and continues to pay all Rent when due.

V.

Compliance with Laws; Use.

VI.

Security Deposit.

A.

The Security Deposit, if any, shall be delivered to Landlord upon the execution of this Lease by Tenant and shall be held by Landlord without liability for interest (unless required by Law) as security for the performance of Tenant’s obligations. The Security Deposit is not an advance payment of Rent or a measure of Tenant’s liability for damages. Landlord may, from time to time, without prejudice to any other remedy, use all or a portion of the Security Deposit to satisfy past due Rent or to cure (after expiration of any applicable cure period) any uncured default by Tenant. If Landlord uses the Security Deposit, Tenant shall within ten (10) days following written demand restore the Security Deposit to its original amount. Landlord shall return any unapplied portion of the Security Deposit to Tenant within 30 days after the later to occur of (1) the date Tenant surrenders possession of the Premises to Landlord in accordance with this Lease; or (2) the Termination Date; provided that in addition to any other deductions Landlord is entitled to make pursuant to the terms hereof, Landlord shall have the right to make a good faith and reasonable estimate of any unreconciled Expenses and/or Taxes as of the Termination Date or date of surrender, as applicable, and to deduct any anticipated shortfall from the Security Deposit. Such good faith and reasonable estimate shall be final and binding upon Tenant. If Landlord transfers its interest in the Premises, Landlord shall assign the Security Deposit to the transferee and, following the assignment, Landlord shall have no further liability for any claims by Tenant for the return of the Security Deposit to the extent such claims arise or accrue after the date of such transfer. Landlord shall not be required to keep the Security Deposit separate from its other accounts. Tenant hereby waives the provisions of Section 1950.7 of the California Civil Code, or any similar or successor Laws now or hereinafter in effect.

B.

The Security Deposit shall be in the form of an irrevocable letter of credit (the “Letter of Credit”), which Letter of Credit shall: (a) be in the original amount of $500,000.00; (b) be issued on the form attached hereto as Exhibit   H ; (c) name Landlord as its beneficiary; and (d) be drawn on an FDIC insured financial institution reasonably satisfactory to the Landlord. Landlord agrees that Silicon Valley Bank shall be deemed a satisfactory financial institution for the purpose of issuing the initial Letter of Credit. The Letter of Credit (and any renewals or replacements thereof) shall be for a term of not less than 1 year. Tenant agrees that it shall from time to time, as necessary, whether as a result of a draw on the Letter of Credit by Landlord pursuant to the terms hereof or as a result of the expiration of the Letter of Credit then in effect, renew or replace the original and any subsequent Letter of Credit so that a Letter of Credit, in the amount required hereunder, is in effect until a date which is at least 60 days after the Termination Date of the Lease. If Tenant fails to furnish such renewal or replacement at least 60 days prior to the stated expiration date of the Letter of Credit then held by Landlord, Landlord may draw upon such Letter of Credit and hold the proceeds thereof (and such proceeds need not be segregated) as a Security Deposit pursuant to the terms of this Article VI. Any renewal or replacement of the original or any subsequent Letter of Credit shall meet the requirements for the original Letter of Credit as set forth above, except that such replacement or renewal shall be issued by an FDIC insured financial institution reasonably satisfactory to the Landlord at the time of the issuance thereof.

C.

Subject to the remaining terms of this Article VI, Tenant shall have the right to reduce the Security Deposit (i.e. the Letter of Credit) by the amount of the Unused Allowance (as defined in the Work Letter). In addition, but subject to the remaining terms of this Article VI, and provided Tenant has timely paid all Rent due under this Lease during the 12 month period immediately preceding the effective date of any reduction of the Security Deposit, Tenant shall have the right to reduce the amount of the Security Deposit (i.e., the Letter of Credit) on or after the following dates by the following amounts: (i) less $24,000.00, effective as of the first day of the fifteenth (15 ^th ) month of the Term; (ii) less an additional $42,000.00, effective as of the first day of the twenty-fifth (25 ^th ) month of the Term; (iii) less an additional $42,000.00, effective as of the first day of the thirty-seventh (37 ^th ) month of the Term; and (iv) less an additional $42,000.00, effective as of the first day of the forty-ninth (49 ^th ) month of the Term. If Tenant is not entitled to reduce the Security Deposit (i.e., the Letter of Credit) as of a particular reduction effective date due to Tenant’s failure to timely pay all Rent during the 12 months prior to that particular reduction effective date, then any subsequent reduction(s) Tenant is entitled to hereunder shall be reduced by the amount of the reduction Tenant would have been entitled to had Tenant timely paid all Rent during the 12 months prior to that particular earlier reduction effective date. Notwithstanding anything to the contrary contained herein, if Tenant has been in default under this Lease at any time prior to the effective date of any reduction of the Security Deposit and Tenant has failed to cure such default within any applicable cure period, then Tenant shall have no further right to reduce the amount of the Security Deposit (i.e. the Letter of Credit) as described herein.

D.

Any reduction in the Letter of Credit shall be accomplished by Tenant providing Landlord with a substitute letter of credit in the reduced amount.

VII.

Services.

A.

Tenant shall (where practicable) contract for and pay directly (at Tenant’s sole cost and expense) when due, all services and utilities to the Premises, including, but not limited to, heating, ventilation and air-conditioning, electricity, water, gas, light, power, trash pick-up, sewer, telephone, sprinkler charges, janitorial and interior Building security services and all other utility services supplied to the Premises, and all taxes and surcharges thereon, together with any maintenance charges related thereto. If any such services are not separately billed or metered to Tenant, Tenant shall pay an equitable proportion, as determined in good faith by Landlord, of all charges billed or metered with other premises. All sums payable under this Article VII shall constitute Additional Rent hereunder. Landlord agrees to maintain and repair the Property as described in Article IX.B. Tenant shall have access to the Building for Tenant and its employees 24 hours

B.

Any interruption or termination of, services due to the application of Laws, the failure of any equipment, the performance of repairs, improvements or alterations, or the occurrence of any other event (a “Service Failure”) shall not render Landlord liable to Tenant, constitute a constructive eviction of Tenant, give rise to an abatement of Rent, nor relieve Tenant from the obligation to fulfill any covenant or agreement. Furthermore, in no event shall Landlord be liable to Tenant for any loss or damage, including the theft of Tenant’s Property (defined in Article XV), arising out of or in connection with the failure of any security services, personnel or equipment. However, if the Premises, or a material portion of the Premises, are made untenantable for a period in excess of 3 consecutive Business Days as a result of a Service Failure that is reasonably within the control of Landlord to correct, then Tenant, as its sole remedy, shall be entitled to receive an abatement of Rent payable hereunder during the period beginning on the 4 ^th consecutive Business Day of the Service Failure and ending on the day the service has been restored. If the entire Premises have not been rendered untenantable by the Service Failure, the amount of abatement shall be equitably prorated.

VIII.

Leasehold Improvements.

IX.

Repairs, Maintenance and Alterations.

A.

Tenant’s Repair and Maintenance Obligations . Tenant shall, at its sole cost and expense, promptly perform all maintenance and repairs to the Premises that are not Landlord’s express responsibility under this Lease, and shall keep the interior of the Premises in good condition and repair (including the replacement of any applicable improvements and appurtenances when necessary), reasonable wear and tear and damage by casualty (subject to the terms of Article XVII) excepted. Tenant’s repair and replacement obligations include, without limitation, repairs to and replacements of: (1) floor covering; (2) interior partitions; (3) doors (4) interior walls and wall coverings; (5) electronic, phone and data cabling and related equipment (collectively, “Cable”) that is installed by or for the exclusive benefit of Tenant and located in the Premises or other portions of the Building, Campus or Project; (6) private showers and kitchens, including hot water heaters, and similar facilities; (7) mechanical (including HVAC), plumbing fixtures, fire sprinklers, sewer connections (within the Building), wiring, electrical, lighting, and fire, life safety equipment and systems exclusively serving the Premises; (8) windows, glass and plate glass; (9) ceilings; (10) the roof membrane to the extent covering the Premises; (11) skylights, smoke hatches and roof vents (to the extent any exist in the Premises); (12) fixtures and equipment; (13) truck doors, hardware, dock bumpers, dock plates and levelers; (14) floors and floor coverings; and (15) Alterations performed by contractors retained by Tenant, including related HVAC balancing. All work shall be performed in accordance with the rules and procedures described in Section IX.C. below. If Tenant uses rail and if required by the railroad company, Tenant agrees to sign a joint maintenance agreement governing the use of the rail spur, if any. In addition, Tenant shall, at its sole cost and expense, provide janitorial service to the Premises in a manner consistent with other similar projects in the Redwood City, California area. The janitorial service to be provided by Tenant shall include, but not be limited to, the obligation to clean the exterior windows and to keep the interior of the Premises such as the windows, floors, walls, doors, showcases and fixtures clean and neat in appearance and to remove all trash and debris which may be found in or around the Premises. Tenant shall also enter into and keep and maintain in effect, service contracts reasonably acceptable to Landlord for regularly scheduled preventative maintenance with contractors reasonably acceptable to Landlord for the maintenance of those systems exclusively servicing the Premises which Tenant is required to maintain hereunder, including, without limitation, the HVAC, electrical and life safety systems exclusively serving the Premises. Such service contracts must include all services suggested by the equipment manufacturer within the operation/maintenance manual and must become effective and a copy thereof delivered to Landlord within 30 days after the Commencement Date. Without limiting the foregoing, Tenant shall, at Tenant’s sole cost and expense,

B.

Landlord’s Repair Obligation . Landlord shall keep and maintain in good repair and working order and make repairs to and perform maintenance upon: (1) the structural elements of the Building, including, without limitation, the columns, footings, structural floor, interior load bearing and exterior walls; (2) Common Areas; (3) the roof of the Building, including roof screens and roof screen penetrators, but excluding the roof membrane; and (4) elevators (if any) serving the Building. Landlord shall promptly make repairs (considering the nature and urgency of the repair) for which Landlord is responsible. Tenant shall pay Tenant’s Pro Rata Share of such repair and maintenance costs incurred by Landlord to the extent such costs are properly included in Expenses. The term “exterior walls” as used herein shall not include windows, glass or plate glass, doors, dock bumpers or dock plates, special store fronts or office entries, Subject to Section XVI, any damage caused by or repairs necessitated by any negligence or act of Tenant or any Tenant Related Party (as defined in Article XIV below) may be repaired by Landlord at Landlord’s option and Tenant’s expense. Tenant shall promptly give Landlord written notice of any defect or need of repairs in such components of the Building for which Landlord is responsible, after which Landlord shall have a reasonable opportunity and the right to enter the Premises at all reasonable times to repair same. Landlord’s liability with respect to any defects, repairs, or maintenance for which Landlord is responsible under any of the provisions of this Lease shall be limited to the cost of such repairs or maintenance, and there shall be no abatement of Rent and no liability of Landlord by reason of any injury to or interference with Tenant’s business arising from the making of repairs, alterations or improvements in or to any portion of the Premises, the Building, the Campus or the Project, or to fixtures, appurtenances or equipment in the Building, except as provided in Section VII.B and Article XVII. Tenant hereby waives any and all rights under and benefits of subsection 1 of

C.

Alterations . Tenant shall not make alterations, additions or improvements to the Premises or install any Cable in the Premises or other portions of the Building, the Campus or the Project (collectively referred to as “Alterations”) without first obtaining the written consent of Landlord in each instance, which consent shall not be unreasonably withheld, conditioned or delayed, However, Landlord’s consent shall not be required for any Alteration that satisfies all of the following criteria (a “Cosmetic Alteration”): (1) is of a cosmetic nature such as painting, wallpapering, hanging pictures and installing carpeting; (2) is not visible from the exterior of the Premises or Building; (3) will not affect the systems or structure of the Building, the Campus or the Project; and (4) does not require work to be performed inside the walls or above the ceiling of the Premises. However, even though consent is not required, the performance of Cosmetic Alterations shall be subject to all the other provisions of this Section IX.C. Prior to starting work, Tenant shall furnish Landlord with plans and specifications reasonably acceptable to Landlord; names of contractors reasonably acceptable to Landlord (provided that Landlord may designate specific contractors with respect to Building systems); copies of contracts; necessary permits and approvals; evidence of contractor’s and subcontractor’s insurance in amounts reasonably required by Landlord; and any security for performance that is reasonably required by Landlord (provided that no such security shall be required for Alterations costing less than $50,000.00). Changes to the plans and specifications must also be submitted to Landlord for its approval, which shall not be unreasonably withheld, conditioned or delayed. Alterations shall be constructed in a good and workmanlike manner using materials of a quality that is at least equal to the quality designated by Landlord as the minimum standard for the Building and the Campus. Landlord may designate reasonable rules, regulations and procedures for the performance of work in the Building, the Campus and the Project and, to the extent reasonably necessary to avoid disruption to the occupants of the Building, the Campus and the Project, shall have the right to designate the reasonable time when Alterations may be performed. Tenant shall reimburse Landlord within 30 days after receipt of an invoice for reasonable and actual sums paid by Landlord for third party examination of Tenant’s plans for non-Cosmetic Alterations. In addition, within 30 days after receipt of an invoice from Landlord, Tenant shall pay Landlord a fee for Landlord’s oversight and coordination of any non-Cosmetic Alterations equal to 3% of the cost of the non-Cosmetic Alterations. Upon completion, Tenant shall furnish “as-built” plans (except for Cosmetic Alterations), completion affidavits, full and final waivers of lien in recordable form, and receipted bills covering all labor and materials. Tenant shall assure that the Alterations comply with all insurance requirements and Laws. Landlord’s approval of an Alteration shall not be a representation by Landlord that the Alteration complies with applicable Laws or will be adequate for Tenant’s use. At least 10 Business Days before beginning construction of any Alteration, Tenant shall give Landlord written notice of the expected commencement date of that construction to permit Landlord to post and record a notice of non-responsibility. Upon substantial completion of construction, if the law so provides, Tenant shall cause a timely notice of completion to be recorded in the office of the recorder of the county in which the Building is located.

X.

Use of Utility Services by Tenant.

A.

Electricity, gas, water and other utility services used by Tenant in the Premises shall be paid for by Tenant through inclusion in Expenses (except as provided in Section X.B. for excess usage). Electrical service to the Premises may be furnished by one or more companies providing electrical generation, transmission and distribution services, and the cost of electricity may consist of several different components or separate charges for such services, such as generation, distribution and stranded cost charges. Landlord shall have the exclusive right to select any company providing electrical service to the Premises, to aggregate the electrical service for the Property and Premises with other buildings, to purchase electricity through a broker and/or buyers group and to change the providers and manner of purchasing electricity. Landlord shall be entitled to receive a fee (if permitted by Law) for the selection of utility companies and the negotiation and administration of contracts for electricity, provided that the amount of such fee shall not exceed 10% of any savings obtained by Landlord.

B.

Tenant’s use of electrical service shall not exceed, either in voltage, rated capacity, or overall load, that which Landlord deems to be standard for the Building. If Tenant requests permission to consume excess electrical service, Landlord may refuse to consent or may condition consent upon conditions that Landlord reasonably elects (including, without limitation, the installation of utility service upgrades, meters, submeters, air handlers or cooling units), and the additional usage (to the extent permitted by Law), and reasonable and actual installation and maintenance costs shall be paid by Tenant. Landlord shall have the right to separately meter electrical usage for the Premises and to measure electrical usage by survey or other commonly accepted methods.

XI.

Entry by Landlord.

XII.

Assignment and Subletting.

A.

Except in connection with a Permitted Transfer (defined in Section XII.E. below), Tenant shall not assign, sublease, transfer or encumber any interest in this Lease or allow any third party to use any portion of the Premises (collectively or individually, a “Transfer”) without the prior written consent of Landlord, which consent shall not be unreasonably withheld, conditioned or delayed if Landlord does not elect to exercise its termination rights under Section XII.B below. Without limitation, it is agreed that Landlord’s consent shall not be considered unreasonably withheld, conditioned or delayed if: (1) the proposed transferee’s financial condition does not meet the criteria Landlord uses to select Building and Campus tenants having similar leasehold obligations, provided, with respect to a subtenant, Landlord shall apply a standard of whether the proposed subtenant is financially able to meet its sublease obligations, including its obligation to pay rent under the sublease, as they become due; (2) the proposed transferee’s business is not suitable for the Building, the Campus or the Project considering the business of the other tenants and the prestige of the Building, the Campus and the Project, or would result in a violation of another tenant’s rights; (3) the proposed transferee is a governmental agency or occupant of the Building or the Campus; (4) Tenant is in default after the expiration of the notice and cure periods in this Lease; or (5) any portion of the Premises, the Building, the Campus or the Project would likely become subject to additional or different Laws as a consequence of the proposed Transfer. Notwithstanding the above, Landlord will not withhold its consent solely because the proposed transferee is an occupant of the Building or Campus if Landlord does not have space available for lease in the Building or Campus that is comparable to the space Tenant desires to sublet or assign. Landlord shall be deemed to have comparable space if it has, or will have, space available an any floor of the Building or another building in the Campus that is approximately the same size as the space Tenant desires to Transfer within 6 months of the proposed commencement of the proposed sublease or assignment. Tenant shall not be entitled to receive monetary damages based upon a claim that Landlord unreasonably withheld its consent to a proposed Transfer and Tenant’s sole remedy shall be an action to enforce any such provision through specific performance or declaratory judgment. Tenant hereby waives the provisions of Section 1995.310 of the California Civil Code, or any similar or successor Laws, now or hereinafter in effect, and all other remedies, including, without limitation, any right at law or equity to terminate this Lease, on its own behalf and, to the extent permitted under all applicable Laws, on behalf of the proposed transferee. Any attempted Transfer in violation of this Article shall, at Landlord’s option, be void. Consent by Landlord to one or more Transfer(s) shall not operate as a waiver of Landlord’s rights to approve any subsequent Transfers. In no event shall any Transfer or Permitted Transfer release or relieve Tenant from any obligation under this Lease.

B.

As part of its request for Landlord’s consent to a Transfer (other than a Permitted Transfer), Tenant shall provide Landlord with financial statements for the proposed transferee, a complete copy of the proposed assignment, sublease and other contractual documents and such other information as Landlord may reasonably request. Landlord shall, by written notice to Tenant within 10 Business Days of its receipt of the required information and documentation,

C.

Tenant shall pay Landlord 50% of all rent and other consideration which Tenant receives as a result of a Transfer that is in excess of the Rent payable to Landlord for the portion of the Premises and Term covered by the Transfer. Tenant shall pay Landlord for Landlord’s share of any excess within 30 days after Tenant’s receipt of such excess consideration. Tenant may deduct from the excess alt reasonable and customary expenses directly incurred by Tenant attributable to the Transfer (other than Landlord’s review fee), including brokerage fees, legal fees and construction costs. If Tenant is in Monetary Default (defined in Section XIX.A. below), Landlord may require that all sublease payments be made directly to Landlord, in which case Tenant shall receive a credit against Rent in the amount of any payments received (less Landlord’s share of any excess). Notwithstanding anything in the foregoing to the contrary, in the event that Tenant Transfers any portion of the Second Floor Premises (other than pursuant to a Permitted Transfer) prior to the Second Floor Rent Commencement Date, during any part of the term of such Transfer that is prior to the Second Floor Rent Commencement Date, Tenant shall pay Landlord 100% of all rent and other consideration which Tenant receives (after appropriate deductions as provided above) as a result of a Transfer that is in excess of the Rent payable to Landlord for the portion of the Second Floor Premises subject to the Transfer; provided that If the term of such Transfer extends beyond the Second Floor Rent Commencement Date, following the Second Floor Rent Commencement Date Landlord shall be entitled to only 50% of such excess rent and consideration.

D.

Except as provided below with respect to a Permitted Transfer, if Tenant is a corporation, limited liability company, partnership, or similar entity, and if the entity which owns or controls a majority (more than 50%) of the voting shares/rights at any time changes for any reason (including but not limited to a merger, consolidation or reorganization), such change of ownership or control shall constitute a Transfer. The foregoing shall not apply so long as Tenant is an entity whose outstanding stock is listed on a recognized security exchange, or if at least 80% of its voting stock is owned by another entity, the voting stock of which is so listed.

E.

So long as Tenant is not entering into the Permitted Transfer for the purpose of avoiding or otherwise circumventing the remaining terms of this Article XII, Tenant may assign its entire interest under this Lease, without the consent of Landlord, to (i) an affiliate, subsidiary, or parent of Tenant, or a corporation, partnership or other legal entity wholly owned by Tenant (collectively, an “Affiliated Party”), or (ii) a successor to Tenant by purchase, merger, consolidation or reorganization, provided that all of the following conditions are satisfied (each such Transfer a “Permitted Transfer”): (1) Tenant is not in default under this Lease beyond applicable cure periods; (2) the Permitted Use does not allow the Premises to be used for retail purposes; (3) unless prohibited by law (in which case Tenant shall give Landlord notice within 10 days, or as soon thereafter as is permitted by law, following the transfer), Tenant shall give Landlord written notice at least 15 days prior to the effective date of the proposed Permitted Transfer; (4) with respect to a proposed Permitted Transfer to an Affiliated Party, Tenant continues to have a net worth equal to or greater than Tenant’s net worth at the date of this Lease; and (5) with respect to a purchase, merger, consolidation or reorganization or any Permitted Transfer which results in Tenant ceasing to exist as a separate legal entity, (a) Tenant’s successor shall own all or substantially all of the assets of Tenant, and (b) Tenant’s successor shall have a net worth which is at least equal to the greater of Tenant’s net worth at the date of this Lease or Tenant’s net worth as of the day prior to the proposed purchase, merger, consolidation or reorganization. Tenant’s notice to Landlord shall include information and documentation showing that each of the above conditions has been satisfied. If requested by Landlord, Tenant’s successor shall sign a commercially reasonable form of assumption agreement. As used herein, (A) “parent” shall mean a company which owns a majority of Tenant’s voting equity; (B) “subsidiary” shall mean an entity wholly owned by Tenant or at least 51% of whose voting equity is owned by Tenant; and (C) “affiliate” shall mean an entity controlled, controlling or under common control with Tenant. Notwithstanding the foregoing, if any parent, affiliate or subsidiary to which this Lease has been assigned or transferred subsequently sells or transfers its voting equity or its interest under this Lease other than to another parent, subsidiary or affiliate of the original Tenant named hereunder, such sale or transfer shall be deemed to be a Transfer requiring the reasonable consent of Landlord hereunder.

XIII.

Liens.

XIV.

Indemnity and Waiver of Claims.

A.

Except to the extent caused by the negligence or willful misconduct of Landlord or any Landlord Related Parties (defined below), Tenant shall indemnify, defend and hold Landlord, its trustees, members, principals, beneficiaries, partners, officers, directors, employees, Mortgagee(s) (defined in Article XXVI) and agents (“Landlord Related Parties”) harmless against and from all liabilities, obligations, damages, penalties, claims, actions, costs, charges and expenses, including, without limitation, reasonable attorneys’ fees and other professional fees (if and to the extent permitted by Law) (collectively, “Claims”), which may be imposed upon, incurred by or asserted against Landlord or any of the Landlord Related Parties and arising out of or in connection with any damage or injury occurring in the Premises or any acts or omissions (including violations of Law) of Tenant, the Tenant Related Parties (defined below) or any of Tenant’s transferees, contractors or licensees.

B.

Except to the extent caused by the negligence or willful misconduct of Tenant or any Tenant Related Parties (defined below), Landlord shall indemnify, defend and hold Tenant, its trustees, members, principals, beneficiaries, partners, officers, directors, employees and agents (“Tenant Related Parties”) harmless against and from all Claims which may be imposed upon, incurred by or asserted against Tenant or any of the Tenant Related Parties and arising out of or in connection with the acts or omissions (including violations of Law) of Landlord, the Landlord Related Parties or any of Landlord’s contractors.

C.

Landlord and the Landlord Related Parties shall not be liable for, and Tenant waives, all claims for loss or damage to Tenant’s business or loss, theft or damage to Tenant’s Property or the property of any person claiming by, through or under Tenant resulting from: (1) wind or weather; (2) the failure of any sprinkler, heating or air-conditioning equipment, any electric wiring or any gas, water or steam pipes; (3) the backing up of any sewer pipe or downspout; (4) the

XV.

Insurance.

XVI.

Subrogation.

XVII.

Casualty Damage.

A.

If all or any part of the Premises is damaged by fire or other casualty, Tenant shall immediately notify Landlord in writing. During any period of time that all or a material portion of the Premises is rendered untenantable as a result of a fire or other casualty (including due to the inaccessibility of the Premises), the Rent shall abate for the portion of the Premises that is untenantable and not used by Tenant. Landlord shall have the right to terminate this Lease if: (1) the Building, the Campus or the Project shall be damaged so that, in Landlord’s reasonable judgment, substantial alteration or reconstruction of the Building or the Campus shall be required (whether or not the Premises has been damaged), and such reconstruction or alteration would effectively eliminate the continued use of the Premises in the manner contemplated by this Lease; (2) Landlord is not permitted by Law to rebuild the Building, the Campus or the Project in substantially the same form as existed before the fire or casualty; (3) the Premises have been materially damaged and there is less than 2 years of the Term remaining on the date of the casualty; (4) any Mortgagee requires that the insurance proceeds be applied to the payment of the mortgage debt; or (5) a material uninsured loss to the Building, the Campus or the Project occurs. Notwithstanding the foregoing, Landlord will not be entitled to terminate this Lease solely because there is less than 2 years on the Term if Tenant has an exercisable right to renew or extend the Term and Tenant, within 15 days after receipt of Landlord’s written notice of termination, validly exercises such right. The foregoing shall not prohibit Landlord from exercising its right to terminate for any of the other reasons set forth herein. Landlord may exercise its right to terminate this Lease by notifying Tenant in writing of such termination as soon as reasonably practicable (taking into consideration delays such as adjustment of insurance claims), but in all circumstances within 90 days after the date of the casualty. If Landlord does not terminate this Lease, Landlord shall commence and proceed with reasonable diligence to repair and restore the Building and the Leasehold Improvements (excluding any Alterations that were performed by Tenant in violation of this Lease). However, in no event shall Landlord be required to spend more than the insurance proceeds received by Landlord together with any applicable deductible; provided that if Landlord does not receive sufficient insurance proceeds to substantially complete the restoration of the Premises and Landlord elects not to fund any shortfall, Landlord shall so notify Tenant immediately and Tenant, within 10 days after such notification, shall have the right to terminate this Lease by the giving of written notice to Landlord. Landlord shall not be liable for any loss or damage to Tenant’s Property or to the business of Tenant resulting in any way from the fire or other casualty or from the repair and restoration of the damage. Landlord and Tenant hereby waive the provisions of any Law relating to the matters addressed in this Article, and agree that their respective rights for damage to or destruction of the Premises shall be those specifically provided in this Lease.

B.

If all or any portion of the Premises shall be made untenantable (including due to the inaccessibility of the Premises) by fire or other casualty, Landlord shall, with reasonable promptness, cause an architect or general contractor selected by Landlord to provide Landlord and Tenant with a written estimate of the amount of time required to substantially complete the repair and restoration of the Premises and make the Premises tenantable again, using standard working methods (“Completion Estimate”). If the Completion Estimate indicates that the Premises cannot be made tenantable within 180 days from the date the repair and restoration is started, then regardless of anything in Section XVII.A above to the contrary, either party shall have the right to terminate this Lease by giving written notice to the other of such election within 10 days after receipt of the Completion Estimate. Tenant, however, shall not have the right to terminate this Lease if the fire or casualty was caused by the negligence or intentional misconduct of Tenant, Tenant Related Parties or any of Tenant’s transferees, contractors or licensees. Notwithstanding the foregoing, if Tenant was entitled to but elected not to exercise its right to terminate the Lease and Landlord does not substantially complete the repair and restoration of the Premises within 2 months after the expiration of the estimated period of time set forth in the Completion Estimate, which period shall be extended to the extent of any Reconstruction Delays, then Tenant may terminate this Lease by written notice to Landlord within 15 days after the expiration of such period, as the same may be extended. For purposes of this Lease, the term “Reconstruction Delays” shall mean: (i) any delays caused by the insurance adjustment process; (ii) any delays caused by Tenant; and (iii) any delays caused by events of Force Majeure.

C.

The provisions of this Lease, including this Article XVII, constitute an express agreement between Landlord and Tenant with respect to any and all damage to, or destruction of, all or any part of the Premises, the Building, the Property, the Campus or the Project, and any Laws, including, without limitation, Sections 1932(2) and 1933(4) of the California Civil Code, with respect to any rights or obligations concerning damage or destruction in the absence of an express agreement between the parties, and any similar or successor Laws now or hereinafter in effect, shall have no application to this Lease or any damage or destruction to all or any part of the Premises, the Building, the Property, the Campus or the Project.

XVIII.

Condemnation.