OFFICE LEASE BREA FINANCIAL COMMONS

Exhibit 10.1

OFFICE LEASE

BREA FINANCIAL COMMONS

MAGUIRE PROPERTIES – 130 S. STATE COLLEGE, LLC,
a Delaware limited liability company,

as Landlord,

and

CAPITALSOURCE BANK,
a California corporation,

as Tenant

TABLE OF CONTENTS

INDEX

OFFICE LEASE

     THIS OFFICE LEASE (“Lease”) is made and entered into by and between MAGUIRE PROPERTIES — 130 S. STATE COLLEGE, LLC, a Delaware limited liability company (“Landlord”) and the Tenant described in Item 1 of the Basic Lease Provisions as of November 5, 2008 (the “Effective Date” ).

BASIC LEASE PROVISIONS

To:       Tenant

Prior to and after the Commencement Date:

CapitalSource Bank
4445 Willard Avenue, 12 ^th Floor
Chevy Chase, Maryland 20815
Attn: Chief Legal Officer

Maguire Properties-130 S. State College, LLC
PO Box 60577
Los Angeles, CA 90060-0577

Wire Transfer Instructions Information:
Bank of the West
ABA #121-100-781
Account #737-010314
Maguire Properties-130 S. State College, LLC

     This Lease shall consist of the foregoing Basic Lease Provisions, and the provisions of the Standard Lease Provisions (the “Standard Lease Provisions” ) (consisting of Articles 1 through 30 which follow) and Exhibits “A” through “G” , inclusive, all of which are incorporated herein by this reference as of the Effective Date. In the event of any conflict between the provisions of the Basic Lease Provisions and the provisions of the Standard Lease Provisions, the Standard Lease Provisions shall control. Any initially capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Standard Lease Provisions.

STANDARD LEASE PROVISIONS

ARTICLE 1

PREMISES

     1.1 Lease of Premises . Landlord hereby leases the Premises (as defined in Item 2.1 of the Basic Lease Provisions) to Tenant (defined below), and Tenant hereby leases the Premises from Landlord, upon all of the terms, covenants and conditions contained in this Lease. Pursuant to the terms of this Lease, Tenant shall have access to the Premises 24 hours per day, seven days per week. As used in this Lease, “Tenant” means Original Tenant, and any person or entity to whom or to which all of Original Tenant’s interest in this Lease is assigned (or otherwise transferred) in accordance with the provisions of Article 15 of this Lease.

     1.2 Delivery and Acceptance of Premises . Subject to Landlord’s express representations, warranties and covenants in this Lease (collectively, “Landlord’s Warranties” ), Landlord shall deliver the Premises to Tenant in its As-Is condition for Tenant’s installation of Tenant Improvements therein in accordance with the provisions of Exhibit “C” attached hereto within one (1) business day after the mutual execution and delivery of this Lease (the actual date of delivery of the Premises to Tenant, the “Delivery Date” ), and Tenant shall accept the Premises in its As-Is condition for Tenant’s use and occupancy and improvement thereof in accordance with this Lease, subject to Landlord’s Warranties, including Landlord’s obligation to perform the Landlord’s Work (as defined in Section 1.1 of Exhibit “C” attached hereto). The parties anticipate that the Delivery Date will occur on or before December 1, 2008. Except as otherwise expressly provided in this Lease, Landlord shall have no obligation to repair, restore, renovate or improve the Premises. If there are latent defects in the Premises or any part thereof, Tenant shall be deemed to have accepted same unless Tenant notifies Landlord thereof within six (6) months after Tenant obtains actual knowledge of such defect(s). Landlord shall have no responsibility to correct or liability with respect to any latent defects in any portion of the Tenant Improvements or Alterations (as defined in Section 10.2 below) installed by a contractor of Tenant, but shall be responsible for repair of or liable for latent defects in the core and shell of the Building, subject to all applicable statutes of limitation. Except as otherwise expressly provided in this Lease, Tenant acknowledges that neither Landlord nor any agent of Landlord has made any representation or warranty with respect to the Premises, the Building or any other portion of the Project, including without limitation, any representation or warranty with respect to the suitability or fitness of the Premises, the Building or any other portion of the Project for the conduct of Tenant’s business. Nothing in this Section 1.2 shall modify, diminish or otherwise affect the repair and maintenance obligations of Landlord and Tenant set forth in Sections 9.1 and 9.2 below.

     1.3 Measurement of the Rentable Area of Premises and the Building .

          1.3.1 For purposes of this Lease, the parties hereby stipulate that the number of rentable square feet contained within the Premises is as set forth in Item 2.2 of the Basic Lease Provisions.

          1.3.2 The “Rentable Area” or “rentable square feet” and “Usable Area” or “usable square feet” of any portion of the Premises shall be calculated by Landlord in accordance with the Standard Method for Measuring Floor Area in Office Buildings, ANSI Z65.1 - 1996 ( “BOMA” ).

     1.4 Common Areas . “Common Areas” shall mean the plaza and sidewalk areas, accessways and Project parking facilities, including surface parking (collectively the “Parking Facilities” ), and the area on individual floors in the other buildings of the Project, devoted to corridors, fire vestibules, elevators, foyers, lobbies, electric and telephone closets, restrooms, mechanical rooms, janitor’s closets, and other similar facilities for the benefit of all tenants and invitees and shall also mean those areas of the other buildings of the Project devoted to mechanical and service rooms servicing the Building, or the other buildings of the Project, as applicable. The Common Areas shall be subject to the exclusive management and control of Landlord. Landlord shall have the right from time to time to designate, relocate and limit the use of particular areas or portions of the Common Areas so long as such relocation or limitation does not prevent Tenant from accessing the Premises or Parking Facilities or materially interfere with Tenant’s use of the Premises for the conduct of its business (Landlord shall use commercially reasonable efforts to give Tenant advance notice of such actions if Tenant would be affected thereby). Landlord shall also have the right to temporarily close all or any portion of the Common Areas as may, in the reasonable discretion of Landlord, be necessary to prevent a dedication thereof or the accrual of any rights in any person so long as such action does not prevent Tenant from accessing the Premises or Parking Facilities or materially interfere with Tenant’s use of the Premises for the conduct of its business (Landlord shall use commercially reasonable efforts to give Tenant advance notice of such temporary closures if Tenant would be affected thereby).

ARTICLE 2

TERM

     2.1 Term . Unless earlier terminated or extended in accordance with the express provisions hereof, the initial term of this Lease shall be the period shown in Item 3.1 of the Basic Lease Provisions (the “Term” ). Promptly following the Commencement Date, Landlord and Tenant shall confirm the Commencement Date and the Lease Expiration Date by executing and delivering a notice substantially in the form attached hereto as Exhibit “B” , which Tenant shall execute and return to Landlord within thirty (30) days of receipt thereof.

     2.2 Commencement . The Term shall commence on the Commencement Date as defined in Item 3.3 of the Basic Lease Provisions; provided, however, that in the event the Term shall commence on a day other than the first day of any calendar month, for purposes of calculating the Lease Expiration Date and the timing of all scheduled increases in Base Rent during the Term, the Commencement Date shall be deemed to be the first day of the calendar month following the Commencement Date. This Lease shall be a binding contractual obligation effective upon execution hereof by Landlord and Tenant notwithstanding the later commencement of the Term of this Lease. Notwithstanding anything to the contrary set forth in this Lease, if the Commencement Date has not occurred by August 31, 2009 due to Landlord Delay (as defined in Paragraph 7.1(a) of Exhibit “C”) or Landlord’s Work Delay (as defined in Section 7.3 of Exhibit “C”), then Landlord shall reimburse Tenant for the excess amount of the monthly rent paid by Tenant for its existing office space in Brea, California or for any other office space Tenant occupies because the landlord of its existing office space refuses to allow Tenant to remain in its existing office space (collectively, “Existing Space” ) over the amount of monthly rent that is owed by Tenant under its existing lease for such Existing Space prior to the expiration of the term thereof, for the period from September 1, 2009 until the Commencement

Date occurs (but not beyond February 28, 2010) ( “Excess Rent” ); provided further that if Tenant is unable to remain in its Existing Space after the termination of its existing lease and relocates to a temporary location, then Landlord shall, in addition to reimbursing Tenant for the Excess Rent, reimburse Tenant for all expenses incurred in packing, moving, and unpacking to a temporary location, including the costs of rewiring telephone, computer and other equipment, new stationary, cards, announcements and all other costs that would not have been incurred but for the “double move.” Tenant will not consent to any increase in the holdover rent payable by Tenant, or other terms regarding Tenant’s obligations with respect to holding over in the Existing Space that could increase Landlord’s obligation hereunder, if not required by Tenant’s existing landlord or the fee owner of the property where the Existing Space is located as determined by Tenant in good faith, without Landlord’s prior written consent. If the Commencement Date has not occurred by October 1, 2009 due to Landlord Delay or Landlord’s Work Delay, Tenant shall have the right, upon fifteen (15) days’ notice to Landlord (which notice shall be ineffective if the Commencement Date has occurred by the end of such fifteen (15) day period) to terminate this Lease, and in the event of such termination Landlord shall refund to Tenant the amount of actual out-of-pocket costs Incurred by Tenant, in excess of the Tenant Improvement Allowance, to design and construct the Tenant Improvements, within ten (10) days of receipt of reasonable evidence of such costs. Without limiting all other remedies and rights of Tenant under this Lease (including recovery of Excess Rent), if the Commencement Date has not occurred by September 1, 2009 due to Landlord Delay or Landlord’s Work Delay and this Lease has not been terminated pursuant to the preceding sentence, then following the Commencement Date, Tenant shall receive a rent credit equal to three (3) days of Base Rent for each day after September 1, 2009 that the Commencement Date fails to occur due to Landlord Delay or Landlord’s Work Delay. By way of example, if the Commencement Date does not occur until September 15, 2009 due to Landlord Delay, then Tenant shall receive a Base Rent credit equal to forty-five (45) days of Base Rent.

     2.3 Renewal Term .

          2.3.1 Provided that a monetary Event of Default is not in existence as of the date of exercise of the Renewal Option, Tenant shall have one (1) option to renew this Lease ( “Renewal Option” ) for the entire Premises for a period of five (5) years (the “Renewal Term” ) commencing on the first day after the Lease Expiration Date ( “Renewal Term Commencement Date” ). The Renewal Option shall be exercisable by Tenant giving written notice ( “Renewal Notice” ) to Landlord of its exercise of the Renewal Option at least nine (9) months, but not more than fifteen (15) months, prior to the expiration of the initial Term of the Lease.

          2.3.2 The Base Rent payable hereunder for the Premises during the Renewal Term shall be adjusted to the Fair Market Rental Rate (as defined in Section 2.4 below) as of the Renewal Term Commencement Date. In order to determine the Fair Market Rental Rate for the Renewal Term, Landlord and Tenant ten (10) days after the date on which the Renewal Notice is given by Tenant (but not earlier than twelve (12) months prior to the Renewal Term Commencement Date), shall commence discussions to endeavor to agree upon the applicable Fair Market Rental Rate. In the event Landlord and Tenant do not agree upon such rate within twenty (20) days after the expiration of said ten (10) day period, on the twenty-fifth (25th) day after the expiration of said ten (10) day period, Landlord and Tenant shall each simultaneously submit to the other in writing its good faith estimate of the Fair Market Rental Rate. If the higher of said estimates is not more than one hundred and five percent (105%) of the lower of such estimates, the Fair Market Rental Rate in question shall be deemed to be the average of the submitted rates. If otherwise, then the rate shall be set by arbitration to be held in Irvine, California in accordance with the Real Estate Valuation Arbitration Rules of the American Arbitration Association, except that the arbitration shall be conducted by a single arbitrator mutually acceptable to the parties and otherwise appointed in accordance with the rules of the American Arbitration Association and shall be on the basis that the arbitrator shall pick one of the two rates submitted, being the rate which is closer to the Fair Market Rental Rate as determined by the arbitrator using the definition set forth in Section 2.4 below. The parties agree to be bound by the decision of the arbitrator, which shall be final and non-appealable, and shall share equally the costs of arbitration, and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.

          2.3.3 During the Renewal Term, Tenant shall pay Additional Rent in accordance with the provisions of Article 4, but with a Base Year determined in connection with the determination of the Fair Market Rental Rate.

          2.3.4 The Renewal Option set forth in this Section 2.3 is personal to Tenant and may not be assigned, transferred or conveyed to any party, except in connection with an assignment of the Lease in its entirety to an Affiliate or Successor of Tenant (as defined in Section 15.1).

     2.4 Fair Market Rental Rate . The phrase “Fair Market Rental Rate” shall mean the fair market value annual rental rate which Landlord and other landlords leasing space of comparable type, size, level of improvement, quality and floor height in first class office buildings comparably located would obtain, at or about the time of the determination of the Fair Market Rental Rate, from any prospective tenant for general office use of such space. Fair Market Rental Rate shall take into account the value of any rent or equivalent economic concessions then usually and customarily given in connection with the leasing of such comparable space for a comparable lease term including such items as the amount and quality of existing or new tenant improvements provided by the landlord, tenant improvement allowances (taking into account the level of existing tenant improvements which, in determining the Fair Market Rental Rate for the Renewal Term, shall be deemed suitable for Tenant, but Tenant shall be entitled to repair and refurbishment of such existing tenant improvements to the extent such repair or refurbishment is available in comparable transactions and the Premises require the same), free rent and the level of any escalation base or “stop” for such comparable space, but excluding brokerage commission obligations. Solely as an example to illustrate the operation of this Section 2.4, if comparable space leases in the Project (or in comparable buildings for similar space) give a tenant space for $40.00 per square foot of Rentable Area, with a $6.00 per square foot tax and operating expense base amount, give four (4) months free rent, and an allowance of $40.00 per square foot of Usable Area for tenant improvements in unimproved space, and if the space has not been improved previously for occupancy, the Fair Market Rental Rate shall not be $40.00 per square foot of Rentable Area only, but, after taking into account any of such concessions to which Tenant is entitled under this Lease, shall also account for the value of the $6.00 per square foot tax and operating expense base amount, four (4) months free rent and $40.00 per square foot of Usable Area tenant improvement allowance.

ARTICLE 3

RENT; LATE CHARGES

     3.1 Base Rent; Rent .

          3.1.1 Tenant agrees to pay during the Term of this Lease as Base Rent ( “Base Rent” ) for the Premises the sums shown for such periods in Item 4 of the Basic Lease Provisions.

          3.1.2 Except as expressly provided to the contrary herein, Base Rent shall be payable in equal consecutive monthly installments, in advance, without abatement, deduction or offset (except as expressly provided herein), commencing on the Commencement Date and continuing on the first day of each calendar month thereafter, or, in the event the first day of a calendar month is not a business day, then the next business day, except that the amount of Ninety-Two Thousand Two Hundred and 60/100 Dollars ($92,200.60) shall be paid to Landlord upon Tenant’s execution hereof and shall be applied by Landlord to the first payment of Base Rent due hereunder. If the Commencement Date is a day other than the first day of a calendar month, then the Base Rent for the Partial Lease Month (the “Partial Lease Month Rent” ) shall be calculated on a per diem basis determined by dividing the initial Monthly Base Rent shown in Item 4 of the Basic Lease Provisions by the actual number of days in such Partial Lease Month and by multiplying such amount by the number of remaining days of such month from and including the Commencement Date. Base Rent, all forms of Additional Rent (defined below) payable hereunder by Tenant and all other amounts, fees, payments or charges payable hereunder by Tenant shall (i) each constitute rent payable hereunder (and shall sometimes collectively be referred to herein as “Rent” ), (ii) be payable to Landlord when due without any prior notice or demand therefor (except as otherwise expressly required under this Lease) in lawful money of the United States and without any abatement, offset or deduction whatsoever (except as expressly provided herein) and (iii) be payable to Landlord at the address of Landlord described in Item 11 of the Basic Lease Provisions or to such other person or to such other place as Landlord may from time to time designate in writing to Tenant.

          3.1.3 Notwithstanding anything to the contrary in this Lease, all of Tenant’s obligations to pay Base Rent (as set forth in Section 4 of the Basic Lease Provisions) and Additional Rent under Article 4 of this Lease shall be fully abated for each of the second (2 ^nd ), third (3 ^rd ), fourth (4 ^th ), fifth (5 ^th ), sixth (6 ^th ) and seventh (7 ^th ) months of the Initial Term (the aggregate amount of Rent so abated is referred to herein as the “Abated Rent Amount” ).

          3.1.4 No payment by Tenant or receipt by Landlord of a lesser amount than the correct Rent due hereunder shall be deemed to be other than a payment on account; nor shall any endorsement or statement on any check or any letter accompanying any check or payment be deemed to effect or evidence an accord and satisfaction; and Landlord may accept such check or payment without prejudice to Landlord’s right to recover the balance or pursue any other remedy in this Lease or at law or in equity provided.

     3.2 Late Charge; Interest . Tenant acknowledges that the late payment of Base Rent, Additional Rent or any other amounts payable by Tenant to Landlord hereunder will cause Landlord to incur administrative costs and other damages, the exact amount of which would be impracticable or extremely difficult to ascertain. Landlord and Tenant agree that if Landlord does not receive any such payment on or before the date that is seven (7) days after the date the payment is due, Tenant shall pay to Landlord, as Additional Rent, (i) a late charge ( “Late Charge” ) equal to three percent (3%) of the overdue amount to cover such additional administrative costs, and (ii) interest on all delinquent amounts at the lesser of (l) the Interest Rate (as hereinafter defined) or (2) the maximum amount allowed by law, from the date due until the date paid. Notwithstanding the foregoing, Tenant shall not be obligated to pay the Late Charge for the first two (2) late payments in any consecutive twelve (12) month period, provided each such payment is not outstanding more than five (5) business days after notice thereof from Landlord to Tenant stating that payment was not made or received when due. For purposes of this Lease, the “Interest Rate” shall mean the floating commercial loan rate announced from time to time by such national recognized money-center bank as Landlord shall in good faith select, as its prime or reference rate, plus 2% per annum.

     3.3 Additional Rent . For purposes of this Lease, all amounts (other than Base Rent) payable by Tenant to Landlord pursuant to this Lease, whether or not denominated as such, shall constitute additional rent ( “Additional Rent” ) hereunder.

ARTICLE 4

ADDITIONAL RENTAL

     4.1 Payment of Excess Operating Expenses and Property Taxes . Subject to the provisions of this Lease, in addition to paying Base Rent pursuant to Article 3 of this Lease, with respect to each Expense Year (defined below), Tenant shall also pay as Additional Rent Tenant’s Percentage Share of the positive excess, if any, of the Operating Expenses (defined below) allocable hereunder to such Expense Year over Operating Expenses allocable hereunder to the Base Year. Subject to the provisions of this Lease, in addition to paying Base Rent pursuant to Article 3 of this Lease, with respect to each Expense Year Tenant shall also pay as Additional Rent Tenant’s Percentage Share of the positive excess, if any, of Property Taxes (defined below) allocable hereunder to such Expense Year over the Property Taxes allocable hereunder to the Base Year. Subject to the provisions of this Lease, in addition to paying Base Rent pursuant to Article 3 of this Lease, with respect to each Expense Year Tenant shall also pay as Additional Rent the Utility Excess (as defined in Section 8.2 below), if any.

     4.2 Definitions .

          4.2.1 “Base Year” shall mean the calendar year specified in Item 5.1 of the Basic Lease Provisions. However, the Base Year applicable during the Renewal Term shall be determined as specified in Section 2.3.3 above. “Expense Year” shall mean each calendar year in which any portion of the Term of this Lease falls, through and including the calendar year in which the Term of this Lease expires.

          4.2.2 “Property Taxes” shall mean all real property taxes, assessments, fees, charges, or impositions and other similar governmental or quasi-governmental ad valorem or other charges levied on or attributable to the Building or its ownership, operation or transfer of any and every type, kind, category or nature, whether direct or indirect, general or special, ordinary or extraordinary and all taxes, assessments, fees, charges or similar impositions imposed in lieu or substitution (partially or totally) of the same including, without limitation (i) all taxes, assessments, levies, charges or impositions on any interest of Landlord in the Building, the Premises or in this Lease, or on the occupancy or use of space in the Building or the Premises; (ii) any transit taxes or charges, business or license fees or taxes, annual or periodic license or use fees, park and/or school fees, arts charges, parks charges, housing fund charges; (iii) all taxes, assessments, levies, charges or impositions imposed for street, refuse, police, sidewalks, fire protection and/or similar services and/or maintenance, whether previously provided without charge or for a different charge, whether provided by governmental agencies or private parties, and whether charged directly or indirectly through a funding mechanism designed to enhance or augment benefits and/or services provided by governmental or quasi-governmental agencies; (iv) any possessory taxes charged or levied in lieu of real estate taxes; and (v) any costs or expenses incurred or expended by Landlord in investigating, calculating, protesting, appealing or otherwise attempting to reduce or minimize Property Taxes. Notwithstanding any provision hereof to the contrary, there shall be excluded from Property taxes (i) all income taxes, capital stock, inheritance, estate, gift, or any other taxes imposed upon or measured by Landlord’s gross income or profits unless the same shall be imposed in lieu of real estate taxes or other ad valorem taxes and (ii) all documentary

transfer, mortgage or stamp taxes arising from any direct or indirect transfer of Landlord’s interest in any part of the Project or the Lease.

          4.2.3 “Operating Expenses” shall mean, subject to Section 4.2.4, below, all costs, fees, amounts, disbursements and expenses paid or incurred by or on behalf of Landlord with respect to any Expense Year in connection with the operation, ownership, maintenance, insurance, restoration, management, replacement or repair of the Building, or any portion thereof, and to the extent equitably allocated to the Building in accordance with Section 4.3.2, below, the Project, or any portion thereof, in a first class manner at least equal to the quality of the Project as of the Delivery Date, including, without limitation, amounts paid or incurred with respect to:

               (i) Premiums for property, casualty, liability, rent interruption, flood, earthquake, terrorism or other types of insurance (if Landlord elects to provide such coverages, and with no obligation to do so except as otherwise expressly required by this Lease) carried by Landlord from time to time, and any commercially standard and reasonable deductibles thereunder actually paid by Landlord with respect to the Building, excluding the amount of any deductible in excess of Twenty-Five Thousand Dollars ($25,000.00).

               (ii) Salaries, wages and other amounts paid or payable for personnel (including, without limitation, the Project manager, Building manager, superintendent, operation and maintenance staff, the Parking Facilities (defined below) manager, concierge (if any) and other employees of Landlord not above the level of general manager), but only to the extent they are involved in the maintenance and operation of the Building, including contributions and premiums towards fringe benefits, unemployment taxes and insurance, social security taxes, disability and worker’s compensation insurance, pension plan contributions and similar premiums and contributions which may be levied on such salaries, wages, compensation and benefits and the total charges of any independent contractors or property managers engaged in the operation, repair, care, maintenance and cleaning of any portion of the Building.

               (iii) Cleaning expenses, janitorial services, window cleaning, and garbage and refuse removal.

               (iv) Subject to the limitation on Capital Items in Section 4.2.3(x), landscaping and hardscape expenses, irrigating, trimming, mowing, fertilizing, seeding, and replacing plants, trees and hardscape.

               (v) The cost of providing fuel, gas, electricity, water, sewer, telephone, steam and other utility services to the Common Areas.

               (vi) Subject to the limitations on Capital Items in Section 4.2.3(x), the cost of maintaining, operating, restoring, renovating, managing, repairing and replacing components of equipment or machinery, including, without limitation, heating, refrigeration, ventilation, electrical, plumbing, mechanical, elevator, escalator, sprinklers, fire/life safety, security and energy management systems, including service contracts, maintenance contracts, supplies and parts with respect thereto.

               (vii) The costs of security for, and supervision of, the Building.

               (viii) Rental, supplies and other costs with respect to the operation of the management office for the Building.

               (ix) All cost and fees for licenses, certificates, permits and inspections, and the cost incurred in connection with the implementation of a transportation system management program or similar program in which participation is required by any applicable Laws.

               (x) The cost of replacement, repair, acquisition, installation and modification of (A) carpeting and wallcoverings, ceiling systems and fixtures in the Common Areas, and other furnishings in the Common Areas, (B) materials, tools, supplies and equipment purchased by Landlord, but only to the extent they are used in the maintenance, operation and repair of the Building, and (C) any other form of improvements, additions, repairs, or replacements to the Building, the Common Areas of the Project or the systems, equipment or machinery operated or used in connection with the Building; provided, however, that with respect to those items described above which constitute a capital item, addition, repair or improvement (collectively “Capital Items” ) in accordance with generally accepted accounting and management practices, in each case the cost of each such Capital Item shall be amortized (including interest on the unamortized cost) over the shorter of (A) the useful life, or (B) the cost recovery period (i.e., the anticipated period to recover the full cost of such capital item from cost savings achieved by such capital item), of the relevant capital item as reasonably determined by Landlord in accordance with generally accepted accounting and management practices; provided further, however, that Capital Items shall be included in Operating Expenses only if the implementation of such items is reasonably anticipated to achieve economies in the operation, maintenance or repair of the Project or portion thereof (provided such reasonably anticipated economies are reasonably evident before the capital cost is incurred in a comparison of the savings reasonably anticipated to be achieved from the capital item to the amortization of the expected cost of such capital items as set forth hereinabove), or is required under any Law becoming effective after the date of this Lease (or as enforced after the date of this Lease). Nothing set forth in this Section 4.2.3(x) shall limit, curtail or otherwise affect Landlord’s obligations under Section 7.2.3 below.

               (xi) Attorneys’, accountants’ and consultants’ fees and expenses reasonably related to the management, operation, administration, maintenance and repair of the Building, including, but not limited to, such expenses that relate to seeking or obtaining reductions in or refunds of Property Taxes, or components thereof, or the costs of contesting the validity of applicability of any governmental enactments which may reduce Operating Expenses.

               (xii) Property management fee in an amount not to exceed three percent (3%) of the gross revenues of the Project.

               (xiii) Sales, use and excise taxes on goods and services purchased by Landlord for the management, maintenance, administration or operation of the Building.

               (xiv) Payments required under any covenants, conditions and restrictions pertaining to the Building or any easement, license, parking or operating agreement or similar instrument which affects the Building.

               (xv) The costs (except for any Capital Items which shall be treated in accordance with Section 4.2.3(x) above) of repairing, restoring and maintaining the Parking Facilities for the Building, including, without limitation, the resurfacing, restriping and cleaning of such facilities.

               (xvi) Costs of any cost-sharing arrangements with adjacent properties to the extent such cost-sharing arrangement results in an aggregate reduction in Operating Expenses.

          4.2.4 Notwithstanding any provision to the contrary in this Lease, the following costs and expenses shall be excluded from Operating Expenses for purposes of this Lease:

               (i) expenses relating to leasing space in the Building or Project (including tenant improvements, leasing and brokerage commissions and advertising expenses);

               (ii) legal fees and disbursements incurred for collection of tenant accounts or negotiation of leases, or relating to disputes between Landlord and other tenants and occupants of the Building or Project;

               (iii) any costs for any Capital Items unless specifically permitted by Section 4.2.3, parts (i) through (xvi), inclusive;

               (iv) Property Taxes;

               (v) costs of any items to the extent Landlord receives insurance proceeds or reimbursement from third parties to cover such costs;

               (vi) except to the extent specifically provided in Section 4.2.3, parts (i) through (xvii), inclusive, depreciation or payments of principal and interest on any mortgages upon the Building;

               (vii) payments of ground rent pursuant to any ground lease covering the Building;

               (viii) subject to Section 4.3.1, the costs of gas, steam or other fuel; operation of elevators and security systems; heating, cooling, air conditioning and ventilating; chilled water, hot and cold domestic water, sewer and other utilities or any other service work or facility or benefit, or level or amount thereof, provided to any other tenant or occupant in the Building or Project which either (a) is not required to be supplied or furnished by Landlord to Tenant under the provisions of this Lease or (b) is supplied or furnished to Tenant pursuant to the terms of this Lease with separate or additional charge;

               (ix) the cost of any Tenant Improvements and any Landlord’s Work (as such terms are defined in the Work Letter), and the cost of correcting any latent defects in me Landlord’s Work;

               (x) any costs for which Landlord is reimbursed by any tenant or occupant of the Building or the Project or by insurance carried by Landlord, Tenant or any other party, or self-insurance, or covered by any warranty to the extent such amounts are actually received by Landlord;

               (xi) except to the extent specifically provided otherwise in this Lease, and except as to the management fees payable to Landlord or its subdivisions or affiliates, the overhead and profit increments paid to Landlord, or to any subdivision or affiliate of Landlord, for goods and/or services in the Building, to the extent such overhead and profit increments exceed the costs of comparable, first-class, high quality goods and/or services, delivered or rendered by unaffiliated third parties of comparable reputation, stature, experience and quality to Landlord, on a competitive basis;

               (xii) costs incurred in developing and leasing the Building and the Project, including, without limitation, architectural fees, engineering fees, space planning fees, broker’s commissions, advertising, promotional or marketing costs and attorney and other professional fees;

               (xiii) except as specifically set forth in Section 4.2.3 above, depreciation, amortization, interest, principal and other payments on mortgages and any other form of monetary encumbrance or any form of financing of Landlord relating to the Project, and any other cost or expense relating or required pursuant to or on account of any such mortgage, encumbrance or financing, if any;

               (xiv) any reserves for bad debts or rent loss, or similar losses, or capital reserves for ownership of the Project;

               (xv) Landlord’s general corporate overhead and general administrative expenses not related to the operation of the Building and all compensation to executives, officers or partners of Landlord or to persons who are executives or officers of partners of Landlord or to any other person at or above the level of building manager, other than the Project manager;

               (xvi) interest, fines or penalties assessed as a result of Landlord’s failure to make payments in a timely manner, including without limitation, Property Taxes;

               (xvii) any expenses of any employee who does not devote substantially all of his or her employed time to the management, operation or maintenance of the Project unless such wages, benefits and expenses are reasonably and equitably prorated to reflect time spent on operating and managing the Project vis-à-vis time spent on matters unrelated to operating and managing the Project;

               (xviii) any cost or expense related to the removal, abatement, cleanup, containment or remediation of any Hazardous Materials (as hereinafter defined), including without limitation, hazardous substances in the ground water or soil, unless the Hazardous Materials were in or on the Building or the Project as a result of the negligence or willful misconduct of Tenant or its agents or employees (provided, however, that unless caused by the negligence or willful misconduct of Landlord, its agents or employees or in violation of Landlord’s obligations under this Lease, Operating Expenses shall include costs incurred in connection with the clean-up, remediation, monitoring, management and administration of Hazardous Materials used in accordance with all applicable Laws by Landlord after the Commencement Date and reasonably

required for the operation, repair and maintenance of the Project to perform Landlord’s obligations under this Lease (such as, without limitation, fuel oil for generators, cleaning solvents, and lubricants) and which are customarily found or required in first-class office buildings);

               (xix) costs, including permit, license and inspection costs and any allowances or other tenant improvement concessions, incurred or provided with respect to the design, construction and/or installation of other tenants’ or occupants’ improvements made for tenants or other occupants in the Project or incurred in renovating or otherwise improving, decorating, painting or redecorating vacant space for tenants or other occupants in the Project;

               (xx) except for making repairs or keeping permanent systems in operation while repairs are being made, rentals and other related expenses incurred in leasing air conditioning systems, elevators or other equipment ordinarily considered to be of a capital nature, except equipment not affixed to the Building or Project which is used in providing janitorial or similar services;

               (xxi) to the extent applicable, electric power costs or other utility costs for which any tenant directly contracts with the local public service company (but Landlord shall have the right to “gross up” as if the floor was vacant);

               (xxii) costs arising from Landlord’s charitable or political contributions;

               (xxiii) costs arising from Landlord’s warranties to bring the Building Property (as defined in Section 7.2.2 below) into compliance with Laws and to correct certain water intrusion defects (if any) pursuant to Sections 7.2.2, 7.2.3 and 9.1 of this Lease;

               (xxiv) costs arising from any breach of this Lease by Landlord;

               (xxv) costs incurred in bringing the Project into compliance with the Current CC&Rs in effect on the Commencement Date;

               (xxvi) costs of repairs and replacements of the Building Structure and/or Building Systems, except (A) as expressly permitted under Section 4.2.3(x) in the case of Capital Items, and (B) minor repairs and replacements which do not constitute Capital Items and are not required due to defects in existence on the Commencement Date;

               (xxvii) any cost or expense related to the removal, abatement, cleanup, containment or remediation of any mold, unless the presence of such mold in the Building or Project resulted from the negligence or willful misconduct of Tenant or its agents or employees; and

               (xxviii) any other costs or expenses customarily excluded from operating expenses under Institutional Owner Practices.

          4.2.5 “Tenant’s Percentage Share” shall mean the percentage set forth in Item 5.2 of the Basic Lease Provisions; provided, however, that Landlord shall as appropriate during the Term of this Lease recalculate Tenant’s Percentage Share (based solely on the increase or decrease of tenantable space or re-measurement of space in the Project), in which case Tenant’s Percentage Share shall be calculated by dividing the number of square feet of Rentable Area in the Premises by the number of square feet of Rentable Area in the Building and expressing such quotient in the form of a percentage.

     4.3 Calculation Methods and Adjustments .

          4.3.1 Operating Expenses shall be adjusted to reflect one hundred percent (100%) occupancy of the Building during any period in which the Building is not one hundred percent (100%) occupied.

          4.3.2 As of the date of this Lease, the Project includes the buildings located at 100, 120, 130 and 140 South State College Boulevard and the Operating Expenses incurred for the common areas shared by the Building and buildings 100, 120 and 140 shall be equitably allocated to the Building in accordance with generally accepted accounting and management practices. Landlord shall have the right, from time to time, to add or remove buildings to (i) the Project and/or (ii) the calculation of Operating Expenses and then equitably allocate some or all of the Operating Expenses and/or Property Taxes among different buildings (including any additional buildings) of the Project in accordance with generally accepted accounting and management practices. In such event, Landlord shall reasonably determine a method of allocating such Operating Expenses and/or Property Taxes attributable to such other buildings of the Project to the Building and Tenant shall be responsible for paying Tenant’s Percentage Share of such expenses; provided, however, no such allocation shall result in Tenant’s monetary obligations under this Lease being increased.

          4.3.3 Subject to the provisions of this Section 4.3.3, all calculations, determinations, allocations and decisions to be made hereunder with respect to Operating Expenses or Property Taxes shall be made in accordance with generally accepted accounting and management practices. Landlord shall have the right to equitably allocate some or all of Operating Expenses among particular classes or groups of tenants in the Project (for example, retail tenants) to reflect Landlord’s reasonable determination that measurably different amounts or types of services, work or benefits associated with Operating Expenses are being provided to or conferred upon such classes or groups. Subject to the provisions of this Section 4.3.3, from time to time Landlord shall have the right to expand or contract the amount, scope, level or types of services, work, items or benefits, the cost of which is included within Operating Expenses, so long as Landlord’s treatment of the same for purposes of the calculation of Operating Expenses is generally consistent with generally accepted accounting and management practices. Whenever services, benefits or work are provided to the Building and to additional projects (where allocation of the cost thereof among such projects is required for calculation of Operating Expenses hereunder), in allocating the overall cost thereof (for all such projects) to Operating Expenses hereunder, there shall be excluded from Operating Expenses Landlord’s reasonable determination of the additional overall cost comparison allocable to the provision of such services, benefits or work to the additional projects. All discounts, reimbursements, rebates, refunds, or credits (collectively, “Reimbursements” ) attributable to Operating Expenses or Property Taxes received by Landlord in a particular year shall be deducted from Operating Expenses or Property Taxes in the year the same are received. Landlord shall have the right to exclude from Base Year Operating Expenses the cost of items of service, work or benefits (i) not provided following the Base Year, and (ii) amortized costs relating to capital improvements the amortized cost of which are included in Operating Expenses during the Base Year and are not included in any subsequent Expense Year (because the cost thereof has been fully amortized). All assessments and premiums of Operating

Expenses or Property Taxes which can be paid by Landlord in periodic installments shall be paid by Landlord in the maximum number of periodic installments permitted by Law.

          4.3.4 Subject to applicable Laws and Section 8.2 below, Landlord shall solely determine in its reasonable discretion all decisions with respect to the method and manner by which all utility services shall be billed and provided in the Building, which determinations shall be reasonably made by Landlord on a basis consistent with the practice of the majority of the institutional owners of institutional grade first-class office projects in Orange County, California (“Institutional Owner Practices”) .

          4.3.5 In the event and to the extent Landlord incurs costs or expenses associated with or relating to separate items or categories or subcategories of Operating Expenses which were not part of Operating Expenses during the entire Base Year, Operating Expenses for the Base Year shall be deemed increased by the amounts Landlord would have incurred during the Base Year with respect to such costs and expenses had such separate items or categories or subcategories of Operating Expenses been included in Operating Expenses during the entire Base Year. For example, any new or additional annual premium resulting from any new forms or increased amounts of insurance, including earthquake insurance, any increase in insurance limits or coverage including conversion of coverage from a single-building policy to a blanket policy, or vice versa , or any decrease in deductibles in any year after the Base Year, shall be deemed to be included in Operating Expenses for the Base Year.

     4.4 Payment Procedure; Estimates. During each Expense Year following the Base Year (a “ Comparison Year ”), Landlord shall give Tenant at least ten (10) days prior written notice of its estimate of any increased amounts payable under Section 4.1 for the Comparison Year: Subject to such notice requirement on or before the first day of each calendar month during such Comparison Year, Tenant shall pay to Landlord one-twelfth (1/12th) of such estimated amounts; provided, however, that, not more often than semi-annually, Landlord may, by written notice to Tenant, revise its estimate for such Comparison Year, and all subsequent payments due at least thirty (30) days after Tenant’s receipt of such notice under this Section 4.4 by Tenant for such Comparison Year shall be based upon such revised estimate. Landlord shall deliver to; Tenant within one hundred fifty (150) days after the close of each Comparison Year, a statement of that Comparison Year’s Property Taxes and Operating Expenses, and Tenant’s Percentage Share of actual excess Property Taxes and actual Operating Expenses payable for such Comparison Year pursuant to Section 4.1, as reasonably determined by Landlord (the “ Landlord’s Statement ”) and such Landlord’s Statement shall be binding upon Landlord and Tenant, except as provided in Section 4.5. If the amount of Tenant’s Percentage Share of actual excess Property Taxes and Operating Expenses for any Comparison Year is more than the estimated payments with respect thereto made by Tenant, Tenant shall pay the deficiency to Landlord within thirty (30) days of Tenant’s receipt of Landlord’s Statement. If the amount of Tenant’s Percentage Share of actual excess Property Taxes and Operating Expenses for any Comparison Year is less than the estimated payments for such Comparison Year made by Tenant, such excess payments shall be credited against Rent next payable by Tenant under this Lease or, if the Term of this Lease has expired, such excess shall be paid to Tenant within thirty (30) days of the delivery by Landlord of Landlord’s Statement. No delay in providing any Landlord’s Statement described in this Section 4.4 shall act as a waiver of Landlord’s right to receive payment from Tenant under Section 4.1 above with respect to Tenant’s Percentage Share of Property Taxes and/or Operating Expenses for the period covered thereby. Notwithstanding the immediately preceding sentence, Tenant shall not be responsible for payment of any Property Taxes or Operating Expenses attributable to any Comparison Year which are first billed to Tenant more than one (1) year after the expiration of the applicable Comparison Year (such one (1) year period shall be shortened to six (6) months with respect to any billings after the Lease Expiration Date), provided that in any event Tenant shall be responsible for Tenant’s Percentage Share of actual excess Property Taxes and Operating Expenses which were in dispute or which were undeterminable, or which are levied by any governmental authority or by any public utility companies at any time following the Lease Expiration Date which are attributable to any Comparison Year (provided that Landlord delivers Tenant a bill for such amounts within six (6) months following Landlord’s receipt of the bill therefor). If this Lease shall terminate on a day other than the end of a calendar year, the amount of Tenant’s Percentage Share of actual Property Taxes and actual Operating Expenses payable under Section 4.1 that is applicable to the calendar year in which such termination occurs shall be prorated on the basis that the number of days from January 1 of such calendar year to the termination date bears to 365. The expiration or early termination of this Lease shall not affect the obligations of Landlord and Tenant pursuant to this Section 4.4 to be performed after such expiration or early termination.

     4.5 Records; Audit. Landlord shall maintain in a safe and orderly manner all of its records pertaining to the Additional Rent payable pursuant to this Article 4 for a period of three (3) years after the completion of each calendar year. Landlord shall maintain such records on a current basis and in sufficient detail to permit adequate review thereof and, at all reasonable times, copies of such records shall be available to Tenant’s accounting personnel (but not other representatives except as set forth in this Section 4.5) for such purposes at the management office of the Project. In connection with such inspection, Tenant and Tenant’s agents must agree in advance to follow Landlord’s reasonable rules and regulations regarding inspections of Landlord’s records, and shall execute a commercially reasonable confidentiality agreement regarding such inspection. If Tenant disputes the Landlord’s Statement provided under Section 4.4 above, provided a monetary Event of Default does not exist, Tenant may, by written notice to Landlord within one hundred twenty (120) days after receipt of Landlord’s Statement for a particular Comparison Year, cause an audit to be commenced of the Operating Expenses and Property Taxes for such Comparison Year by a nationally or regionally recognized firm of certified public accountants on a non-contingency fee basis, at Tenant’s sole expense, to verify if Landlord’s Statement was accurate, and for the avoidance of doubt such audit may include review of whether any expense was properly allocated or charged to Tenant in accordance with this Lease. If such audit reveals an overpayment of Operating Expenses and/or Property Taxes for the year covered by such Landlord’s Statement, then, provided Landlord does not dispute the result of such audit, Landlord shall refund the overpayment within thirty (30) days. If such audit reveals an underpayment of Operating Expenses and/or Property Taxes for the year covered by such Landlord’s Statement then Tenant shall pay the same within thirty (30) days, or if the Term has expired, within thirty (30) days after receipt of the audit results. Tenant’s failure to dispute a Landlord’s Statement and commence an audit of Operating Expenses and Property Taxes within ninety (90) days after receipt of Landlord’s Statement for a particular Comparison Year shall constitute Tenant’s acknowledgment of the accuracy of such Landlord’s Statement. Tenant agrees to keep the results of any audit hereunder confidential, except as required by law and/or to enforce Tenant’s rights hereunder. Tenant agrees to pay the cost of any audit hereunder by Tenant; provided that if it is finally determined with respect to any Comparison Year, that Landlord has billed Tenant for Tenant’s Percentage Share of Operating Expenses and Property Taxes more than three percent (3%) in excess of the Operating Expenses and Property Taxes that Tenant should pay for such Comparison Year pursuant to the terms of the Lease, then Landlord shall pay the reasonable cost of such audit.

     4.6 Limitation on Expenses. Operating Expenses payable by Tenant under this Lease shall be calculated after giving effect to the limitation set forth in this Section 4.6. Notwithstanding any provision to the contrary in this Lease, Controllable Expenses (hereinafter defined) shall not increase after the Base Year by more than five percent (5%) per Expense Year on a compounding and cumulative basis over the course of the Initial Term. In other words, Controllable Expenses for the first Expense Year after the Base Year shall not exceed 105% of the Controllable Expenses for the Base Year, Controllable

Expenses for the second Expense Year after the Base Year shall not exceed 105% of the limit on Controllable Expenses for the first Expense Year after the Base Year; Controllable Expenses for the third Expense Year after the Base Year shall not exceed 105% of the limit on Controllable Expenses for the second Expense Year after the Base Year, etc. Landlord shall be solely responsible (as between Landlord and Tenant) and Tenant shall have no obligation to reimburse Landlord for any increase in Controllable Expenses above the limits permitted by this Section 4.6. By way of illustration, if Controllable Expenses were $10.00 per rentable square foot for the Base Year, then Controllable Expenses for the first Expense Year following the Base Year shall not exceed $10.50 per rentable square foot, Controllable Expenses for the second Expense Year following the Base Year shall not exceed S11.025 per rentable square foot, and Controllable Expenses for the third Expense Year following the Base Year shall not exceed $11.57625 per rentable square foot, etc. As used herein, “Controllable Expenses” shall mean all Operating Expenses allocable to the Common Areas other than the following: Property Taxes and all other taxes, assessments and governmental charges; janitorial, cleaning and access control services; utilities; insurance maintained by Landlord as of the Effective Date or otherwise required by Law or the terms of this Lease; Landlord’s management fee (which is based on the gross revenues of the Project); and union wages.

     4.7 Tax Challenge Right. So long as Tenant is leasing all of the Rentable Area of the Building, Tenant shall have the right to provide Landlord with a written request to challenge Property Taxes (a “Tax Challenge Notice” ). In the event Tenant delivers such a Tax Challenge Notice, at Landlord’s option, either (i) Landlord shall diligently pursue claims for reductions in Property Taxes, in which event Landlord shall provide Tenant with detailed information as to how Landlord will pursue such claims, or (ii) Tenant may pursue such claims with Landlord’s concurrence, in the name of Landlord. If Tenant pursues such claims with Landlord’s concurrence, then the costs of such proceedings shall be paid by Tenant. If Landlord agrees to pursue such claims, the costs of such proceedings shall be paid by Landlord and included in Property Taxes in the calendar year such costs are paid. Tenant may give a Tax Challenge Notice prior to the issuance of the actual tax bill by the taxing authority. Tenant’s entry into one or more subleases of the Premises hereunder as permitted by Article 15 below shall not limit or otherwise affect Tenant’s rights under this Section 4.7. Notwithstanding anything to the contrary set forth herein, Tenant shall not have the right to pursue a tax challenge if doing so would violate the CC&Rs (as defined in Section 7.4 below).

ARTICLE 5

ADDITIONAL TAXES

     In addition to the Base Rent and all other forms of Additional Rent payable by Tenant hereunder, Tenant shall reimburse Landlord upon demand as Additional Rent for any and all taxes, impositions or similar fees or charges (other than any of the same actually included by Landlord in Property Taxes with respect to the Expense Year in question) payable by or imposed or assessed upon Landlord upon or with respect to (or measured by or otherwise attributable to the cost or value of): (i) any fixtures, equipment or other personal property owned or leased by Tenant located in or about the Premises; (ii) any leasehold improvements made in or to the Premises by or for Tenant (without regard to ownership of such improvements) if and to the extent the original cost, replacement cost or value thereof exceeds the cost of Landlord’s then effective “Building Standard” tenant improvements, as reasonably determined by Landlord; (iii) the Rent payable hereunder, including, without limitation, any gross receipts tax, license fee or excise tax levied by any governmental authority other than income tax or substitutes in lieu thereof; (iv) the possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy of any portion of the Premises; or (v) this transaction.

ARTICLE 6

SECURITY

     6.1 Letter of Credit . Concurrent with Tenant’s execution and delivery of this Lease, Tenant shall deliver to Landlord an unconditional, irrevocable letter of credit (“LC”) in the original amount of Seven Hundred Fifty Thousand Dollars ($750,000) (the “LC Stated Amount” ). The LC shall be issued by a national money center bank or governmental agency reasonably acceptable to Landlord, and shall be substantially in the form attached hereto as Exhibit “F”. Landlord hereby approves of Federal Home Loan Bank of San Francisco as the issuer of the LC. Tenant shall pay all expenses, points and/or fees incurred in obtaining and renewing the LC. The LC shall be effective from the date of delivery thereof through the date which is thirty (30) days after the Lease Expiration Date (the “LC Expiration Date” ). The LC may be re-issued, renewed or replaced for annual periods, provided that the LC Stated Amount is not reduced except as expressly provided below. Each reissue, renewal or replacement LC shall be substantially in the form attached hereto as Exhibit “F”, and shall be subject to Landlord’s prior written approval. Subject to the provisions of Subparagraphs (1) and (2) immediately below, the LC Stated Amount may be reduced to the following amounts on the following yearly anniversaries of the Commencement Date (each a “Reduction Date”):

     (1) Notwithstanding any contrary provision hereof, if a monetary Event of Default has occurred and is continuing on a Reduction Date, or if a monetary Event of Default would exist and be continuing on a Reduction Date but Landlord is barred by applicable law from sending a notice of default to Tenant with respect thereto, or if Tenant is in monetary default under this Lease and Tenant has received notice thereof as required by this Lease, but failed to cure such monetary default within the time period permitted under this Lease or such lesser time as may remain before a Reduction Date, then the LC Stated Amount shall not be reduced on such Reduction Date (but shall be reduced upon the curing of such monetary default, subject, however, to Landlord’s draw on the LC as permitted hereunder in connection with an Event of Default).

     (2) Notwithstanding any contrary provision hereof, but subject to Subparagraph (1) above, if Tenant provides to Landlord, not less than thirty (30) days or more than forty-five (45) days prior to a Reduction Date, evidence that Tenant has maintained a “total risk-based capital ratio” (as defined in, and calculated pursuant to, Section 206.5 of Regulation F (12 C.F.R. Part 206)) at least equal to the greater of (i) the minimum total risk-based capital ratio required to qualify as “Well-capitalized” under Regulation F, or (ii) thirteen percent (13%), on average during the entire two (2) year period prior to the applicable Reduction Date, then in lieu of the reduction set forth above, the LC Stated Amount shall be reduced on the later of (i) such Reduction Date or (ii) fifteen (15) days after Landlord receives such evidence, as follows:

For purposes of the foregoing, the evidence provided by Tenant to Landlord shall be in the form of certified copies of the reports provided by Tenant to its regulators for purposes of Regulation F compliance.

     6.2 Failure to Reissue, Renew or Replace. If the bank that issues the LC fails to extend the expiration date thereof through the LC Expiration Date, and/or if Landlord receives a notice of non-renewal from such bank (as described in the LC), then Tenant shall provide Landlord with a substitute LC. If Tenant fails to provide Landlord with a substitute LC in a form reasonably acceptable to Landlord at least fifteen (15) days prior to the expiration of the then existing LC, then (i) such failure shall be deemed an Event of Default hereunder, and (ii) Landlord shall be entitled to draw down the full amount of the LC then available and apply, use and retain the proceeds thereof in accordance with Section 6.3.

     6.3 Application of LC and LC Account . Any amount of the LC which is drawn upon by Landlord, but not used or applied by Landlord shall be held by Landlord in an account (the “LC Account”) as security for the full and faithful performance of each of the terms hereof by Tenant, subject to use and application as set forth below. If an Event of Default shall occur and be continuing with respect to any provision of this Lease, including, but not limited to, the provisions relating to the payment of rent, or an Event of Default would exist under the Lease but Landlord is barred by applicable law from sending a notice of default to Tenant with respect thereto, or in the event the LC is not renewed or reissued at least fifteen (15) days prior to the expiration of the then existing LC, Landlord may, but shall not be required to, draw upon all or any part of the LC and/or LC Account or use, retain or apply all or any part of the proceeds thereof for the payment of any sum in default (including past due rent), to repair damages caused by Tenant, to clean the Premises to the extent Tenant has failed to do so in accordance with this Lease, or for the payment of any other amount which Landlord may be entitled to spend under this Lease or become obligated to spend by reason of Tenant’s default or to compensate Landlord for loss or damage which Landlord may suffer by reason of Tenant’s default, including without limitation the amounts to which Landlord may become entitled pursuant to Article 16 below (whether or not such amounts have been awarded) and any other loss, liability, expense and damages that may accrue upon Tenant’s default or the act or omission of Tenant or any officer, employee, agent or invitee of Tenant, and costs and attorneys’ fees incurred by Landlord to recover possession of the Premises upon a default by Tenant hereunder. The use, application, retention or draw of the LC and/or LC Account, or any portion thereof, by Landlord shall not (i) constitute the cure of any default by Tenant or the waiver of such default except to the extent of the application, (ii) prevent Landlord from exercising any other remedies provided for under this Lease or by law, it being intended that Landlord shall not first be required to proceed against the LC and/or LC Account, or (iii) operate as a limitation on the amount of any recovery to which Landlord may otherwise be entitled. If any portion of the LC and/or LC Account is so drawn upon, or any part of the proceeds thereof is used or applied in accordance with this Lease, Tenant shall, within five (5) business days after written demand therefor, deposit cash with Landlord in an amount equal to the draw upon the LC and/or the amount of the LC Account that was used or applied in accordance with this Lease (so that the combined amount of the remaining sums available to be drawn upon the LC and the LC Account balance equals the LC Stated Amount), and Tenant’s failure to do so shall be an Event of Default under this Lease. The LC Account may be commingled with other funds of Landlord, shall be held in Landlord’s name, and Tenant shall not be entitled to any interest or earnings thereon. Notwithstanding any contrary provision herein, in the event that the total amount of the LC outstanding plus any amount remaining in the LC Account exceeds the LC Stated Amount ( “Excess Security” ), then Landlord shall return the amount of the Excess Security to Tenant upon Tenant’s request to the extent that such amount is available in the LC Account.

     6.4 Waiver. Tenant hereby waives the provisions of Section 1950.7 of the California Civil Code, and all similar or successor provisions of law, now or hereafter in force, and Landlord and Tenant hereby acknowledge that their entire agreement with respect to the LC and the LC Account is set forth herein.

     6.5 Expiration of LC. Unless an Event of Default has occurred and is continuing under this Lease or an Event of Default would exist under the Lease but Landlord is barred by applicable law from sending a notice of default to Tenant With respect thereto, within thirty (30) days after the LC Expiration Date, Landlord shall return any LC previously delivered by Tenant and any balance remaining in the LC Account after use and application in accordance with this Article 6, to Tenant (or, at Landlord’s option, to the last assignee, if any, of Tenant’s interest hereunder), and Tenant shall have no further obligation to provide the LC.

     6.6 Landlord’s Transfer. Tenant acknowledges that Landlord has the right to transfer or mortgage its interest in the Building and in this Lease, and Tenant agrees that in the event of any such transfer or mortgage, Landlord shall have the right to transfer or assign the LC and/or the LC Account to the transferee or mortgagee. Upon such transfer or assignment of the LC and/or LC Account, and provided such transferee or mortgagee expressly assumes all obligations relating to such LC and/or the LC Account, Landlord shall be deemed released by Tenant from all liability or obligation for the return of the LC and LC Account, as applicable, and Tenant shall look solely to such transferee or mortgagee for the return thereof. Landlord will comply with the transfer requirements set forth in the LC. Subject to the foregoing, if Landlord transfers or assigns the LC and Tenant fails to cause the bank that issued the LC to accept such transfer or assignment, or to issue a replacement LC which complies with the provisions of this Article 6, such failure shall be an Event of Default hereunder.

     6.7 Bank Obligation. Tenant acknowledges and agrees that the LC is a separate and independent obligation of the issuing bank to Landlord and that Tenant is not a third party beneficiary of such obligation, and that Landlord’s right to draw upon the LC for the full amount due and owing thereunder shall not be, in any way, restricted, impaired, altered or limited by virtue of any provision of the United States Bankruptcy Code, including without limitation, Section 502(b)(6) thereof.

ARTICLE 7

USE OF PREMISES

     7.1 Tenant’s Permitted Use. Tenant shall use the Premises only for Tenant’s Permitted Use as set forth in Item 9 of the Basic Lease Provisions and shall not use or permit the Premises to be used for any other purpose. Tenant shall, at its sole cost and expense, obtain and maintain in full force and effect all governmental licenses, approvals and permits required to allow Tenant to conduct Tenant’s Permitted Use. Landlord disclaims any warranty that the Premises are suitable for Tenant’s use and Tenant acknowledges that it has had a full opportunity to make its own determination in this regard. In no case shall Tenant use any portion of the Premises for (i) offices of any health care professionals or for the provision of any health care services, (ii) any schools or other training facility (except for in house training of employees of Tenant and its Affiliates), (iii) any retail or restaurant uses, (iv) any residential use, or (v) broadcasting radio stations and/or television stations.

     7.2 Compliance With Laws and Other Requirements.

          7.2.1 Without limiting Landlord’s obligations under Sections 7.2.2, 7.2.3 and 9.1 of this Lease, Tenant shall not do anything in or about the Premises, the Building or the Project that will in any way violate any applicable federal, state and local statutes, laws, ordinances, building codes, rules, regulations, orders and directives of any governmental authority having jurisdiction (including without limitation any certificate of occupancy and the ADA) now in force or which may hereafter be enacted (collectively, “Laws”). Tenant shall, at its sole cost and expense, timely take all action required to comply with all Laws applicable to the Premises, the Building or the Project triggered by (a) Tenant’s specific and unique use of the Premises that is different than use for general office purposes or (b) Tenant’s Alterations. Tenant shall not use the Premises, or permit the Premises to be used, in any manner, or do or suffer any act in or about the Premises which: (i) violates or conflicts with any applicable Law; (ii) except for minor damage which is promptly repaired and reasonably necessary in connection with approved Alterations, causes or is reasonably likely to cause damage to the Project, the Premises or the Building systems, including, without limitation, the life safety, electrical, heating, ventilation and air conditioning (“HVAC”), plumbing or sprinkler systems (collectively, the “Building Systems”) for the Building and/or the Project; (iii) violates a requirement or condition of any policy of insurance covering the Project and/or the Premises, or increases the cost of such policy; (iv) constitutes or is reasonably likely to constitute a nuisance; (v) materially interferes with, or is reasonably likely to materially interfere with, the transmission or reception of microwave, television, radio, telephone, or other communication signals by antennae or other facilities located in the Project; or (vi) violates the Rules and Regulations.

          7.2.2 Except as otherwise set forth in Section 7.2.1, above and Section 7.2.3 below, Landlord shall take all timely actions to cause the Base Building, the Building and the portions of the Project, Common Areas and Parking Facilities owned by Landlord and Landlord’s Work (collectively referred to herein as the “Building Property”) to be in compliance with all Laws, including, without limitation, any Law requiring any form of improvement or alteration to the Building Property or Landlord’s Work. The “Base Building” shall include all of the structural portions of the Building (the “Building Structure”) and the Building Systems (defined below).

          7.2.3 Landlord represents and warrants that as of the Commencement Date, to the best knowledge of Landlord, the Building (other than the Tenant Improvements and subject to Tenant’s obligations under the last sentence of this Section 7.2.3) and Landlord’s Work, will comply with all Laws, including applicable building codes and the requirements of the Americans With Disabilities Act (“ADA”) in effect as of the Commencement Date. In the event it is discovered that the foregoing representation is not true at any time (including by enforcement after the Commencement Date), then Landlord shall promptly upgrade the Building and/or Premises at Landlord’s sole cost and expense so as to bring the Building and/or Premises into compliance with such Laws and ADA in effect as of the Commencement Date. Operating Expenses shall not include any cost incurred by Landlord in connection with upgrading the Building and/or Premises to comply with the requirements of Law and the ADA that are in effect as of the Commencement Date, including payment of all penalties or damages incurred due to such noncompliance. Notwithstanding the foregoing provisions of this Section 7.2.3, to the extent that any modifications or upgrades to the Building are required by Laws (including the ADA) due to Tenant’s particular manner of use, occupancy, repair or alteration of the Premises (as opposed to use, occupancy, repair or alteration for normal and customary office purposes by tenants generally) including, without limitation, due to Tenant’s construction of a gym in the Premises, then Tenant, and not Landlord, shall be responsible for the cost of such modifications and upgrades.

     7.3 Hazardous Materials .

          7.3.1 Definitions .

               (i) “ Environmental Laws ” means and includes all now and hereafter existing statutes, laws, ordinances, codes, regulations, rules, rulings, orders, decrees, directives, policies and requirements by any federal, state or local governmental authority regulating, relating to, or imposing liability or standards of conduct concerning public health and safety or the environment.

               (ii) “ Hazardous Materials ” means: (a) any material or substance: (i) which is defined or becomes defined as a “hazardous substance”, “hazardous waste,” “infectious waste,” “chemical mixture or substance,” “Toxic Substance” or “air pollutant” under Environmental Laws; (ii) containing petroleum, crude oil or any fraction thereof; (iii) containing polychlorinated biphenyls (PCB’s); (iv) which constitutes asbestos or asbestos-containing material; (v) which is radioactive; (vi) which is infectious; or (b) any other material or substance displaying toxic, reactive, ignitable, explosive or corrosive characteristics, as all such terms are used in their broadest sense.

               (iii) “ Handle ,” “ Handled ,” or “ Handling ” means any installation, handling, generation, storage, treatment, use, disposal, discharge, release, manufacture, refinement, emission, abatement, removal, transportation or any other activity of any other type in connection with or involving Hazardous Materials.

               (iv) “ Environmental Damages ” means (a) all actual and proximate claims, judgments, damages, penalties, fines, costs, liabilities, and losses (but excluding consequential, special or punitive damages or “Stigma” damages); (b) all sums paid for settlement of claims, reasonable attorneys’ fees, consultants’ fees and experts’ fees; and (c) all costs incurred in connection with investigation or remediation relating to the presence of any Hazardous Materials in, on, under or about the Premises or otherwise relating to the Handling of any Hazardous Materials.

          7.3.2 Tenant’s Obligations .

               (i) No Hazardous Materials shall be Handled upon, about, in, above or beneath the Premises or any portion of the Project by or on behalf of Tenant, its subtenants or its assignees, or their respective contractors, clients, officers, directors, employees, agents, or invitees (collectively, a “Tenant Party” ). Notwithstanding the foregoing, normal quantities of those Hazardous Materials customarily used in the conduct of general administrative and executive office activities (e.g., copier fluids and cleaning supplies) may be used and stored at the Premises without Landlord’s prior written consent, but only in compliance with all applicable Environmental Laws (defined below).

               (ii) Tenant shall, at its sole cost and expense, promptly take all actions (or at Landlord’s election, reimburse Landlord for taking all actions) required by any Law (including any Environmental Laws) that arises in connection with the Handling by Tenant or any other Tenant Party of any Hazardous Materials upon, about, above or beneath the Premises or any portion of the Project. Tenant shall take all actions (or at Landlord’s election, reimburse Landlord for taking all

actions) necessary to restore the Premises or any portion of the Building to the condition existing prior to the introduction of Tenant’s Hazardous Materials to the extent required under any applicable Environmental Laws.

               (iii) Tenant shall indemnify, defend, protect and hold harmless Landlord and each of the Landlord Parties from and against any and all Claims, Damages, Costs and Environmental Damages incurred by Landlord and the Landlord Parties which arise out of any breach by Tenant of any of its obligations under this Section 7.3.2 and/or any Handling by Tenant or any other Tenant Party of any Hazardous Materials.

          7.3.3 Landlord’s Obligations.

               (i) Subject to Section 7.3.2, above, in the event that during the Term of this Lease, it is determined that there exists in, on, under or about the Premises or Project any Hazardous Materials (other than any Hazardous Materials that became present in, on, under or about the Project as a result of the Handling by Tenant or any other any Tenant Party of Hazardous Materials in, on, under or about the Premises or Project), and if (a) a governmental agency having jurisdiction with respect to the presence of Hazardous Materials in, under, on or about the Premises or Project requires remediation of such Hazardous Materials, or (b) the presence of such Hazardous Materials in, on, under or about the Premises or Project (i) creates a health or safety hazard for Tenant’s employees, visitors, customers, agents or any Tenant Party or (ii) interferes with Tenant’s use of the Premises for the Permitted Use, then Landlord shall cause such Hazardous Materials to be abated or remediated in accordance with applicable Environmental Laws.

               (ii) Landlord shall indemnify, defend (with counsel reasonably approved by Tenant), protect and hold harmless Tenant and each of the Tenant Parties, from and against any and all Claims, Damages and Costs which arise from or are related in any way to any contamination of the Premises, Building or the Project, except to the extent caused by Tenant or a Tenant Party. Landlord’s obligation to defend, with counsel reasonably approved by Tenant, indemnify and hold harmless Tenant and the Tenant Parties shall apply in every instance in which Claims, Damages and Costs are asserted against Tenant and/or the Tenant Parties solely due to Tenant’s status as a Tenant, occupant or operator of the Premises, Building or Project. The foregoing indemnification and responsibilities of Landlord shall survive the termination or expiration of this Lease.

               (iii) Landlord covenants to Tenant that, to the best knowledge of Landlord, as of the Effective Date, the Project does not currently contain any Hazardous Materials in violation of any existing applicable Environmental Laws. For purposes of this Section, 7.3.3(iii), the phrase “the best knowledge of Landlord” shall mean the present, actual knowledge of Landlord’s managing agent for the Project.

     7.4 CC&Rs. Tenant shall not violate the Current CC&Rs (defined below). Landlord represents that Tenant’s use of the Premises for general office use will not, in and of itself, violate the Current CC&Rs. The “Current CC&Rs” means the Declaration of Protective Covenants, Conditions and Restrictions for Brea Financial Commons recorded August 12, 1982 in the Orange County Official Records as the same may be amended from time to time. A copy of the Current CC&Rs has been provided by Landlord to Tenant prior to the Effective Date. Additionally, Tenant acknowledges that the Project may be subject to any future covenants, conditions, and restrictions and/or amendments to the Current CC&Rs (in any such event, the “Future CC&Rs”) which Landlord, in Landlord’s discretion, deems reasonably necessary or desirable, and Tenant agrees that this Lease shall be subject and subordinate to the Current CC&Rs and such Future CC&Rs (collectively, the “CC&Rs”); provided, however, that (i) no Future CC&Rs shall materially and unreasonably interfere with Tenant’s use of the Premises for general office use and reasonably incidental uses and (ii) Landlord will not voluntarily enter into or agree to any Future CC&Rs that would increase Tenant’s costs and obligations to comply with such Future CC&RS in comparison to the Current CC&RS. Tenant shall not be responsible for, and as provided in Section 4.2.4(xxv) above Operating Expenses shall not include, costs incurred in bringing the Project into compliance with the Current CC&Rs in effect on the Commencement Date.

ARTICLE 8

UTILITIES AND SERVICES

     8.1 Building Services. Landlord agrees to furnish or cause to be furnished, subject to the provisions of this Lease, as part of Operating Expenses to the Premises, the following utilities and services, subject to the conditions and standards set forth herein:

               8.1.1 Non-attended automatic elevator service.

               8.1.2 Subject to all governmental Laws, rules, regulations and guidelines applicable thereto, HVAC to the Premises, which in Landlord’s reasonable judgment is required for the comfortable use and occupancy of the Premises and meets Institutional Owner Practices for general office purposes, shall be furnished during the periods from 8:00 a.m. to 6:00 p.m., Monday through Friday and, upon Tenant’s prior request, from 9:00 a.m. to 1:00 p.m. Saturday, except New Year’s Eve Day, New Year’s Day, President’s Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, Christmas Eve Day, Christmas Day (on the days such holidays are generally observed) and such other holidays as are generally recognized and observed by Institutional Owner Practices (such hours and days of operation are herein called “Normal Working Hours”). The HVAC for the Premises will be in working order when the Premises are delivered to Tenant. Tenant shall be responsible for and shall pay to Landlord any additional costs (including, without limitation, the costs of installation of additional HVAC equipment) reasonably incurred by Landlord because of the failure of the HVAC system to perform its function due to arrangement of partitioning in the Premises or changes or alterations thereto or from any use by Tenant of heat-generating machinery or equipment other than normal office equipment, including small photocopying machines and personal computers not linked to a central mainframe at the Premises.

               8.1.3 To the electrical power systems providing electricity to the Premises electric current as reasonably required for the Permitted Use; provided, however, that Landlord shall have no obligation under this Section 8.1 to make any modifications, additions, or alterations to the Base Building or to otherwise perform any action required to increase the electrical supply provided to the Premises after Landlord has complied with its obligations under the Work Letter and so long as the power specifications in the Work Letter are maintained. Tenant’s electrical usage shall be subject to all applicable Laws, and without Landlord’s prior written consent, Tenant shall not use in the Premises any equipment or machines that would damage Building Systems by virtue of their power requirements beyond the capacity required to be provided by Landlord under this Lease (“Excess Electrical Requirements”). If Tenant shall require or utilize Excess Electrical Requirements, Tenant shall obtain Landlord’s prior consent thereto, in Landlord’s reasonable discretion, and Landlord, at its election may condition its consent upon Tenant’s payment in advance of Landlord’s total out of pocket cost of designing, installing, maintaining and providing any

additional facilities, machinery and equipment required to satisfy such Excess Electrical Requirements and/or required to restore temperature levels in the Building to levels that would have existed but for Tenant’s use of Excess Electrical Requirements. If Tenant’s Excess Electrical Requirements materially affect the temperature level in the Premises or in the Building, Landlord may, following written notice to Tenant of such proposed installation and Tenant’s continued demand for Excess Electrical Requirements despite such notice, install, at Tenant’s sole cost and expense, any machinery or equipment (including additional HVAC equipment) necessary to restore the temperature level to that otherwise required to be provided and Tenant shall, upon demand, reimburse Landlord for all reasonable, actual costs incurred by Landlord in connection with such additional equipment or systems. Landlord shall have no responsibility for the provision of emergency, supplemental or back-up power (“Back Up Power”) to the Premises.

          8.1.4 City water for drinking and rest room purposes.

          8.1.5 Janitorial and cleaning services conforming to the Landlord’s Project standards in effect from time to time (which shall be consistent with Institutional Owner Practices), provided that the Premises are used exclusively for office purposes and are kept reasonably in order by Tenant. Landlord shall not be required to provide janitorial services for portions of the Premises used for preparing or consuming food or beverages, for storage, as a mailroom, or for a lavatory (other than the Common Area lavatory rooms) other than normal “light” janitorial services such as emptying of waste containers, standard vacuuming, mopping, toilet bowl cleaning and sweeping. Landlord shall not be responsible for more extensive lunch room cleaning such as the washing of dishware or cleaning any refrigerator located therein.

          Any amounts which Tenant is required to pay to Landlord pursuant to this Section 8.1 shall be payable within thirty (30) days of Landlord’s invoice to Tenant and shall constitute Additional Rent. From time to time during the Term, Landlord shall have the right, with Tenant’s consent not to be unreasonably withheld, to modify the services provided to Tenant hereunder; provided, however, such modified services (a) do not materially derogate from the services provided on the Commencement Date and (b) are consistent with Institutional Owner Practices, and (c) comply with Tenant’s reasonable security and other operational requirements. Notwithstanding the foregoing, Tenant’s consent shall not be required with respect to any modifications required by applicable Laws.

     8.2 Separately Metered Utilities. The Premises are separately metered for Utility Services (as hereinafter defined). Tenant shall bear the cost of any fixture unit charges, hook-up fees, use fees, acreage fees, connection fees or other similar charges or fees imposed or assessed in connection with any use of the Premises by Tenant other than for general office purposes. Tenant