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ElECTROtUCAll Y FilED

1 Bernard P. Simons (SBN 41094)
Email: bsimons@reedsmith.com
2 REED SMITH LLP
1901 Avenue of the Stars
3 Suite 700
Los Angeles, CA 90067-6078
4 Telephone: + 1 310 734 5200
Facsimile: + 1 310 734 5299
5
Pavel Ekmekchyan (SBN 223222)
6 Email: pekmekchyan@reedsmith.com
Sarah Woo (SBN 285412)
7 Email: swoo@reedsmith.com
REED SMITH LLP
8 355 South Grand Avenue, Suite 2900
Los Angeles, CA 90017
9 Telephone: +1 213 457 8000
Facsimile: + 1 213 457 8080
10
Attorneys for Plaintiff,
11 Western State University of Southern California,
d/b/a Western State University College of Law
12

Superi or Court of Californi a,
County of Orange

11 10712014 at 03 :48 :21 PM
Clerk of the Superi or Court
By Davon \klasquez, Deput y Clerk

13

SUPERIOR COURT OF THE STATE OF CALIFORNIA

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FOR THE COUNTY OF ORANGE

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30-2014-00755198- CU- C0- CJ C

16 WESTERN STATE UNIVERSITY OF
SOUTHERN CALIFORNIA, d/b/a WESTERN
17 STATE UNIVERSITY COLLEGE OF LAW,
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Case No.

Judge Unda M!rl<s

COMPLAINT FOR DECLARATORY
RELIEF

Plaintiff,
vs.

20 CSU FULLERTON AUXILIARY SERVICES
CORPORATION, a California non-profit public
21 benefit corporation,
22

Defendant.

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-1COMPLAINT FOR DECLARATORY RELIEF

US_ACTIVE-11 9902363-BSJMONS

The Parties

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1.

P1aintiffis Western State University of Southern California, d/b/a Western State

4 University College of Law, a duly organized and existing California corporation [hereinafter
5 "WSU"], doing business in the City of Fullerton, County of Orange, State of California.
6

7

2.

Defendant is CSU Fullerton Auxiliary Services Corporation, a California non-profit

8 public benefit corporation [hereinafter "CSU"], doing business in the City of Fullerton, County of
9 Orange, State of California.
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Jurisdiction and Venue

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12
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3.

Jurisdiction and venue are proper in the County of Orange, State of California since

14 this declaratory relief action involves the legal rights and duties of Plaintiff and Defendant under and
15 pursuant to a written real property lease entered into in the County of Orange, State of California for
16 leased educational premises in Fullerton, California. This declaratory relief action is authorized by
17 CCP section 1060 and is entitled to a speedy trial under CCP section 1062.3.
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Allegations

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4.

On or about September 28, 2012, WSU and CSU entered into the written lease

22 agreement, a true and correct copy of which is attached hereto as Exhibit "1" [hereinafter "The
23 Lease"]. The implied covenant of good faith and fair dealing is included in The Lease, as a matter o
24 law. The Lease, at paragraphs 1.3, 3.0 and 47, sets forth the term of the lease and that the term can
25 be extended by a written amendment.
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5.

On or about June 24, 2014, WSU and CSU, through their duly authorized and acting

28 agents, exchanged emails to amend The Lease by extending the lease term by one year (October 1,

-2COMPLAINT FOR DECLARATORY RELIEF

1 2015-September 30, 2016) and by increasing the rent for the extended one year ($117,423.25 per
2 month to $123,294.41 per month). Attached hereto as Exhibits 2 and 3 are the emails between the
3 authorized and acting representatives of WSU and CSU. Those emails are governed by the
4 California Uniform Electronic Transactions Act (Ca. Civ. Code sections 1633.1-1633.17) and Ca.
5 Civ. Code sections 1635-1644.
6

7

6.

WSU now contends that Exhibits 2 and 3, plus the implied-by-law covenant of good

8 faith and fair dealing, establish and confirm the amendment of The Lease, extending the lease term
9 for one year and increasing the rent for that additional one year. CSU now claims that The Lease
10 was not amended by Exhibits 2 and 3 hereto and that WSU will be in breach of The Lease if it does
11 not vacate the leased premises by September 30, 2015. Exhibits 4 and 5 hereto are true and correct
12 copies of writings between WSU and CSU setting forth, in part, the current controversy between
13 WSU and SCU.
14
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7.

There is now a real, substantial and actual controversy between WSU and CSU

16 relating to their legal rights and duties under The Lease. A judicial declaration ofWSU's and CSU's
17 legal rights and duties is proper at this time so that the Court can make a judicial determination of
18 when the lease term ends, which will avoid legal actions for either unlawful detainer or anticipatory·
19 breach, and the disruption of school - students, faculty and the public.
20
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8.

This declaratory relief action will resolve the real, serious and actual controversy

22 between WSU and CSU as to the lease termination date and the legal duties and obligations of WSU
23 and CSU under the existing lease terms.
24
25

9.

At all times mentioned herein, WSU has performed all express and implied-by-law

26 terms of The Lease. Except as set forth herein, CSU has performed its obligations and duties under
27 The Lease.
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-3COMPLAINT FOR DECLARATORY RELIEF

1

10.

The Lease does provide that the prevailing party in this action shall recover its

2 reasonable attorney's fees. WSU has been required to retain counsel to bring and prosecute this
3 action. WSU is entitled to recover its reasonable legal fees and costs, according to proof. All efforts
4 by WSU to resolve this controversy have been rejected by CSU. This declaratory relief action will
5 protect the interests ofWSU's students, faculty and the public.
6
7

WHEREFORE, Plaintiff prays for Judgment against Defendant as follows:

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1.

For a judicial declaration that the lease term does not end until September 30, 2016;

2.

For an award of reasonable attorneys' fees to Plaintiff, according to proof;

3.

For an award of recoverable costs to Plaintiff, according to proof; and

4.

For such other and further relief as the Court deems just and proper, both in law and

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16 in equity.
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DATED: November 7, 2014

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-4COMPLAINT FOR DECLARATORY RELIEF

EXHIBIT 1 Exhibit 1 Page 1 .

r..10 ' ef tile J*!FSRase Jlrise iR IRe e eAt Ill at IRe bessee er aA) eRe affiliates Corporation. See Paragraph ..-Base Rent and Other Monies Paid on (a) Base Rent: $ 9 9..e. oublic benefit corpo ration ("Lessor") and WESTERN STATE UNIVERSITY OF SOUTHERN CALIFORNIA.57. IRe Sllffi ef er ef IRe tetal E!ase 1 ReAl Jl 8\ asle GllFiAg--any~~6-WB 68 E! Il 8 A I Ie tlla GrigiAal-1T~e*'Fmm.. 1. there are provisions in this Lease for the Base Rent to be adjusted . Jones Lang LaSalle { Bruce Westwood .:..:::a.3) 1.through-- - - .a~~s& ioR Date").0._p. payable on the firs t (1 st ) day of each month commencing on the Commencement Date. (See also Paragraph 5) Fees · $ fer IRa flsriea ~·~~============~============================== (e) TotaiDueUponExecutionofthislease:$ *210. Guarantor. (See also ParagFapR& J .2 andcommonlyknownas l l l l North State College Bou l evard.. 1.-- PAGE 1 OF 23 INITIALS ©2001 ·AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 2 .~AIR COMMERCIAL REAL ESTATE ASSOCIATION STANDARD INDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE --NET (DO NOT USE THIS FORM FOR MULTI-TENANT BUILDINGS) 1..:::.(SeealsoParagraph4) If this box is checked. State of California and generally described as (describe briefly the nature of the property and . located on 3. if the property is located within a Project) Two (2) buildings totaling approximately 86. the o peration of a cafeteria for students.495 useable square feet. which sum.-. (13) PaymeAt te Bre ~km-aA<kleli v~se lly ~etll PaRies. The obligations of the Lessee under this Lease are to be guaranteed by Education Management a Pennsylvania corporation ("Guarantor''). or B repres eAt& ll e!A lesser aRe lesse e (" 011al 'II~ (b) Lessee's Broker shall not receive any compensation in connection with this Lease. classro om s and other uses reas o nab l y re l ated to the operation of an educational institution.2. Fullerton located in the County of .. wi thout limitation..: c2_ _ _ __ __ _ __ is made by and between CSU FULLERTON AUXILIARY SERVICES CORPORATION.11 0 itR bessee asf1blires ffeffi besser aA~ ri~Ris le IRe Premises. 2012 ("Security Deposit") .6 - - - or before the Commencement Date \Jjwfi--El(~: for the period *Octobe r (b) Security Deposit: $11 0 1 58 3 . if applicable. Basic Provisions ("Basic Provisions").. (See also Paragraph 2) months ("Original (as defined in Paragraph 51 ) on the da y before the third (3rd) Term") commencing ("Commencement Date") and ending anniversary of the Commencement Date (' Expiration Date").2 aAEI 3.. includi n a. at Lessee's election..O. (See also Pa ragraph 3) Earl} PessessleR: If IRe Preffiise&-<lre a ailae le bessee H m~-A<We--R~Iu&ille--posses.::._. shall b e paid to Lessor on or before the Commencement Date separately o r such amount by deducting from the proceeds otherwise due Seller under the Purchase Agreement to which this Lease was attached and pursuant to which Lessor ourchased the Premises from Lessee [ "Purchase Agreement " ) 1J AgroedUse: Offices. 991R'Kirl~ 8)1'F-IJIR'Ki9H6>YFI~-=======- er _ _ _ 0 1. _ a California non -p rofit D/B/A WESTERN STATE UNIVERSITY COLLEGE a California corooration ("Lessee").. (collectively the "Parties.628 acres of land more particularly described on Exhibit A attached hereto and all other imorovements thereon.881 . Attached hereto are the following. Premises: That certain real property. dated for reference purposes only "'S.__ _ _ _ _ __ _ _ _ _ _ __ _ .9 Real Estate Brokers: (See also Paragraph 15 and 25) (a) Representation: The following real estate brokers (the "Brokers") and brokerage relationships exist in this transaction (check applicable boxes) : IZI IZI N/~ represents Lessor exclusively ("Lessor's Broker'').3 on and oarking areas and appurtenances Three the Closing Date years (3 ) and Zero (0) (" Premises") ...::c l .:e:c:r~2"-8"-"-. shall equal the amount set forth on Exhibit B attached hereto 0 . b!!&&er sl:l a~~ seP ises reAaeree B) IRe !Orellers IRe sr o~ f~ne altasRea se~Jarat e a~reeffieAI ritteR sr if A9 SllSR a§reemeAt---i&--atlasl:le8 ...t"'e"mb "=-. the "Project" . 1. Term: 1.1 Parties : This Lease ("Lease") .sie~f IRe PreFRises S9FI'\FI'\ef\6iAg- = = = == == == = = = = = = == = = = == = == =:-f'!E'. all of which constitute a part of this Lease: an Addendum consisting of Paragraphs . tile sllm ef sf IRe leta I E!ase ReAl Jl8) asle fer tile Gri!)iAal Term .o..5 Base Rent: $ ~er FAeffiR ("Base Rent") .Booth) represents Lessee exclusively ("Lessee's Broker").::.:." or Individually a "Party"). 4 9 1. 0 8 (G) ~ s esiatleA 3-31 .. faculty and staff (See also Paragraph 6) 18 Insuring Party: Lessor is the "Insuring Party" unless otherwise stated herein (See also Paragraph B) 1. (SeealsoParagraph37) Attachments. including all improvements therein or to be provided by Lessor under the terms of this Lease.464. OF LAW..: nc:.::e:.

or mod ification to the Premises then . and in that event . II l ess ee eees As l @I • ·arraAIY ~tJ:. Exhibit A .-ifl-wfi~R ~ays-a. a Work Letter: * Subject to revision based on any change of the Commencement Date 0 other (specify) . as bess ar's sale eBiigatieA-Witll resJ)e&t le &kiGR maller. Lessor and Lessee shall allocate the cost of such work as follows : (a) Subject to Paragraph 2. If bess ee elesls term1AatleR . if such Capital Expenditures are required as a result of the specific and unique use of the Premises by Lessee as compared with uses by tenants in general. l essee shall imm ealately l'lish reqlllf96-WGh-GaPI!al-6. lRe Ra~~ <lFFaAI) f! erieEis sl'lall-be-a5-4elle e ~lliiiR!J .le~ "BAiilatiAij aFIIHiif.~sea iA IRe F!larlteliA§ sf IRe PreF!lises fer ~"'r~eses sf GsF!l~arise~ The Base Rent stated herein is NOT tied to square footage and is not subject to adjustment should the actual size be determined to be different..xJM!Adit ~weHHessef-wfiH eA-f'loti~ermiAatJeR-Gai~G Gease-the-t~&&-OI-t l:le-Pfem is e s ea1s !Rerealter. Lessor hereby leases to Lessee .~>ira e Aelioo llllkHt1e be tl'le ellllgatklFI e' bessee at bess ea·s sale ses&aRs elEfleR6&.-aRd-dedlcl6kame. Letting. !.1(11) llela are etltaiReEIIl)' lessee aAa lA e i~1A tll 1ft. an amount equal to 1/1441h of the portion of such costs reasonably attributable to the Premises. a current set of the Rules and Regulations. the provisions concerning Capital Expenditures are intended to apply only to non-voluntary . on the date that on which the Base Rent is due. are appropriate for Lessee's Intended use.l.1 upon all of the terms. If le~ol--eleGI-Ie leHAi Ra~alis-to-IE!fldeF-its-6AaAH>f.~are feelaQe ef IRe Preffiises F!lay Ra e lleeA t.a~GA-Gapila~itl.it-!6-fl&~mlsal l) laasll31e Ia pay Its sll are ll=lereef. If the Capital Expend itures are instead triggered by Lessee as a result of an actual or proposed change in use. lltl:le Premises a a Ret sampl) wa~ S6Elr-sl:ia ll.3(c) below.-lhe real. lesser arraRis tl:lat Ia t11~1s-1ffiewl00ge--llle-imJlFB emeAis eR--llle-Pfem~mply-wi!J:HI:le-b Building codes .~iiEiiA§S sA IRe PreFAises (tRe "BuiiEIIR!J") st1all se free el material Elefests.w.6ooEiili&RiAg~&tem s-{. lesser sl=lall a eli er ll=le Premises Ia lessee 13reem sleaA aAS ffee sf aellris sA tl=le GemmeAsemeAI b'ate er tl:!e early 2. or the Applicable Requirements are hereafter changed so as to require during the term of this Lease the construction of an addition to or an alteration of the Premises and/or Building. 2.Lega l Descri ption. and Lessee hereby leases from Lessor.. iA ~IRi~y&-a fleHeBeipl-ol--bes6eAr-t effll!Aat io!l-notiG!HJ:!al-le&5ee-wil~eR-Gapilal-li-J<peREi it\Jre . Premises and/or Building ("Capital Expenditure").tMl.l e 11se te RIGA l essee ·~li e Premises.arra. 2. (b) II such Capital Expenditure is not the result of the specific and unique use of the Premises by Lessee (such as. le sser &llall l:la e tl:l e eptieA Ia te rmiAate IRis l ease I:I~ BA gg Ela) ~lt8fi-Aetlse te le ssee uAiess l ess ee Ratifi es besser.aHaA~e eJEis~A!i elestFisal.1a~ S6Elr-Aa~~ IJ:le4iffer&RGe-betwee!Hile-a~4R~~Il'laAIRs' Base ReAl. sRal l-00-iR-gotXHlpefaliA~~iEI-OO~Re sltuGt~>ra l elamsRis of.llEI malkiAGiieA er tell •iiiiiR ll' e appreprlate .4 Acknowledgements. Lessee shall be fully responsible for the cost thereof. governmentally mandated seismic modifications). or (ii) complete such Capital Expenditure at its own expense.2 FIGS6E!G&ioR-Ga~ver lirsl eesurs ( "Sta~~~e re ~:~ u' rea se P<ise GeAtrasts aessribelil lA ParagFapll 7.~ s biGR C a~ ll a l EM p eAEIU~>re Is re~:~~..L~ssee!s-lermi~ BFH*>I!Ge4!. Lessee Is responsible for determining whether or not the Applicable Requirements.maR~IHi s er tile Sial'! Qale . and especially the zoning. Fie e er !Rat if ~tal-exj)eRElii~>Fe Is re ~:~ ~lreG-4u~&l a )ears er t~s baase aAEi the ~ast tl:lare e' axe&eEI~R s' Base Re Al. plumi3IAIJ.aRy SI:IGR Rel'l sompllaFI Ga. the Premises. applicable laws. BliGepl ~se JlFB ieea iA IRis lease.. (c) Notwithstanding the above. er f!erlieR ll:lereef.l~~ae er Is tle ma~sea. ligFIIiAg. bessee ma1 IR sl aaG termiRale-tR•s-L-ea sEH.. lire spFiAIIIer. :OusFI termiAatieR sate sllall. Lessee shall not. If a ABA sampllaAse 111:! s aiG-w. 2. lessee sl:lall lla a IRa riglll Ia lermiRale tl:lis be au upafl-3l} ritteR ABliss te besser. mall\lFIGtiQR er fa~ll ·s: (il 6 !li e l ess er 11:\e m e F'IIh&-a~ re a.. at the rental. Lessee shall either: (i) immediately cease such changed use or intensity of use and/or take such other steps as may be necessary to eliminate the requirement for such Capital Expenditure. Exhibit B .i~sseiH!1 ay-a<Wa~GR-IIlAEf&. sysl~l) 3Q aa) s as te tl'l e remaiFi iAg &)stems aRs The ·itA spesilisit. maiiiiRSii8 A er la ll10 re . change in intensity of use. er If eR a er sllsl=l s. regulations . then Lessor shall pay for such Capital Expenditure and Lessee shall only be obligated to pay. Lessee shall pay Interest on the balance but may prepay its obligation at any time. axGel)l as ell:. Ela1 s leila lAg-the-Staft-Gale..iR 6 iiFI saiEl Fit'eA Aaliss lrem be&6a(K9!t~A9-f&r~R-wi~REI e lesser riHe R Aellsa e' a AEIR sempliaRse itJHhis m e R~ate~As e sllall be ll=le allli!laYeA ef b e~~ ~ If the Premises do not comply with any Applicable Requirements. covenants or restrictions of record. have any right to terminate this Lease. ' as seAstrusteeL :Oai4-waffaflly4~pfl!Y te t!. (b) it PAGE 2 OF 23 ©2001 -AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 3 .~ ireEI a~:~ riRIJ IRe last 2 ) eaFS-ef-tAI&-bea64HIHI l esser reaseAalll) determfRe&. iA ABe eAt tle earlier tRaA IRe last say lllal bessee seblla le§all) utilile tl=le PreFAises semmeRsiA§ sblsl:l •itl:leut Ga~ital elEJleAElilt. lle e •er. r e im ll ~>•s e l essee oR aA alfset basis.Schedule of Base Rent Premises. NO+!. if aAy. aAa-lllaHRe Premises as Ret seAiaiA Ra<:arEieus le els sf aA) male er fuR§i EleliReEI as tel(iG UREier a ~p llsabl&-Glate ar fe!ler:al Ia .lflle6s-be &6GHWti fle&-l:eseee. the remediation of any Hazardous Substance. lesse sll all. and 2. stems er ele meRIG slla l. II bessee el ees Ae' ~te-waffaAIY-f)efl~iefHl. restii) sa me at l::esser's eM ~ eR se .-wiiMAI~eAI I:IRtlf l esse r's sllara ar susll t"'~ eeR 1~11~ ~aiEl tile remaiREier el IRiG l ea se Is FIG! 9a) s 11 l essee I& " ~o-f+FiaACe les ser'6 sf:! are .3 Compliance. or if IJ:l e aalaRGe ef Ills ReAl Elll &-a~or s~ffiGieAl-!G-full.fteHKeipt~f. unexpected.0 0 0 a plot plan depleting the Premises . covenants and conditions set forth in this Lease. each month during the remainder of the term of this Lease or any extension thereof. lle r e~:~lllre el by-lRe-AmerisaAs ItA Oisallililies AGler aA) Slll'l ll ~ rasult ef lessee's use (see Pa~ll-a~ltera~li!y-ffistallalieAs (as-<lefirleiHA-P.At¥-Pe rlael.o~~fter re sa i ~ t ef BJE!eRI ef & ~> Bil Ae A-691'RpliaAee. however. and ordinances are collectively referred to herein as the f'Applicable Requirements") llla+-wef&-jFI-e#eBHN-tRe-time lllat easlllmpre• smaRt. and new Applicable Requirements. and acknowledges that past uses of the Premises may no longer be allowed.!!WJA~iAg-G~ p~m~s. ll-aari Rg ralls aREI lalli'ISali eA ef aRy l3t..~re .-re&lif) IRe same at less er's 9lifleRse. meEIIAsa tiGAs hisl:l ma. ~eEl. Condition. or the reinforcement or other physical modification of the Unit. aAil all ell=le r su sll etemeAts lA tl=le Premis es. Lessee acknowledges that: (a) it has been given an opportunity to inspect and measure the Premises. preF!lJltll aftef-feGei~~re m bessee setti~ lertl:l AefHlGFAJ!IlaAse. for the term. 10 1Rile IRe a~~rexiffiale Si:jt.. Note: Lessee is advised to verify the actual size prior to executing this Lease. alli er lllaA t~ saRstRJstea 13) lessee.im.

.Aall RBI ee re~ijirea Is eleli er pessessieA sf IRe Premises Is bessee io!Aiil Lessee Shall comply ieG with its obligation to provide evidence of insurance (Paragraph 8.3 FRaintalA-IA&-Pr&fAI&&~e lA enesl duriFlg susllperiae.le GammeAsemeRI Qate . The Commencement Date.ame-ma~ lle ellleRaea uREI~e terms ef aR.}'-G~y.6lJGI1 ~essessisA If bessee tatall) or Premises. Saiel maRies shall sa t>aia at IRe same time aRE! iA IRa same ffiaRRer as IRe ~ 5. All monetary amounts shall be rounded to the nearest whole dollar.5 Lessee as Prior Owner/Occupant. and their suitability for Lessee's intended use. (e) the square footage of the Premises was not material to Lessee's decision to lease the Premises and pay the Rent stated herein. may require all future Rent be paid by cashier's check.wi!IHfle.. 4. Rent.)aiRsl IRe F!ramises. (d) it is not relying on any representation as to the size or condition of the Premises made by Brokers or Lessor.eR& are satisfied 4. ritteR Ratise is Ret resei aa e.Ga\16&~61& ~~H. if any. nor Brokers have made any oral or written representations or warranties with respect to said matters other than as set forth in this Lease. As the result of owning the Premises immediately before the Closing Date.si... IRe Start Qat a slla'l aCGIJr but bessar FAay-elool-tG-will'ltlold-pessessiQA I!AIII SI!GA seAelill. Lessee shall be responsible for any necessary corrective work.15e its sssl semffierslall. Payments will be applied first to accrued late charges and attorney's fees. be&GGH. Passes& lOA slla ll <~at afresl U=1e '"*lliratioo-Qata. Parties. Security Deposit. promises or warranties concerning Lessee's ability to honor the Lease or suitability to occupy the Premises. The warranties made by Lessor in Paragraph 2 shall be of no force or effect if immediately prior to the Start Date Lessee was the owner or occupant of the Premises . 3. In such event. In addition.2 Poeeeeelon. draft.4l:le-e~t shall l:ie allaled-feHAEI f)9fi~s~rly-P&s~~~~AsllJdiAg Bi. except for any delays caused by Seller or the failure to transfer de minimus amounts of such funds (which shall not in any event exceed $25.. IRis bease sflall termiRate ~Riess etRer a(lreeFReAls are reasf1eEI ea~ aeA bessar aRe bessee. 4. security. besser Eleli ereEI il~iR Rat bessee aula SIRe iss Aa e eRje. Re~ itl:lstaAEiiR!l lesser's alestieR te itl111sla pessessieR j)eF!diR!J reseifll sf-&usR-e>. All monetary obligations of Lessee to Lessor under the terms of this Lease (except for the Security Deposit) are deemed to be rent ("Rent"). Term. Lessor acknowledges that: (i) Brokers have made no representations.Flas eeeA all qse!l Bl bess a aAEHer 8reii8FG te satiSPj itself . eEl s11all F8A ffam tl:le Elate af Eleli ery sf psssessisR aREI ssAiiAI!e fer a ~erisEI e~8aite hereaf.<iay-per.. ~Ass. Lessee shall have possession of the Premises as of the Commencement Date .liGeflGIH)HRG~fll:leF. Rent Defined.~GIIlSille-fi!JAH~y-fue paFllall~ essup les t~e Premises prier to l~te. If Lessee fails to pay Rent. or otherwise Breaches Qefa8lts ~Aeler this Lease. ~taR 0 limited to-t~bll9atieRs te pa1 Real Pr~IJBrll TaJ.-if bessea is req!Jireel Ia flarfsrm aRy st~F*IitiGR&-fl~FffiRf.--Afly graAI af !Oafly-FoS&eSsieR sAil sarwe. apply or retain all or any portion of said Security Deposit for the payment of any amount already due Lessor. and (f) neither Lessor. Lessor's agents.StaFI-Gate. lle abligatellts pa. 42 Payment. at its G!ilieR..5). 2. or other instrument of payment given by Lessee to Lessor is dishonored for any reason.ce-a00-6eAGilioo was the prior owner and occupant and WaS therefore familiar With the COndition of the Premises (including but not limited to the electrical. nef-&Aall-6ttGI1 fall8re aneelt"'e • alkl~e tkle EllpiraliaR b'ale bessee sRalklet. without offset or deduction (except as specifically permitted in this Lease). and any remaining amount to any other outstanding charges or costs.itflifi-StHja)s alter IRe GammeRsemem ll. then to Base Rent. lesser agrees Is 1.~t-miRwo-aJ1. besser sllall Flat l:le swllJBGI Ia aRy tiabill1 1 tl:lerefar. ReAl er per:lerm its ether abl~~~ besser dell ers pessessieR er IRe F!Femises a REI aRy paries gf reAl aeatem&RH~GG&e-w&~J~~ye eRja.es aRE! iAS8FaAGe RY GtJGilliarl. Lessee shall cause payment of Rent to be received by Lessor in lawful money of the United States. basses's ri~At Ia saAsal sRall termiRala.w.~s beasa. (c) Lessee has made such investigation as it deems necessary with reference to such matters and assumes all responsibility therefor as the same relate to its occupancy of the Premises.~GA Elate. 11e e ·er . and (ii) it is Lessor's sole responsibility to investigate the financial capability and/or suitability of all proposed tenants. HVAC and fire sprinkler systems. between the Commencement Date and the date upon which Escrow Holder under the Purchase Agreement wire transfers the proceeds due Seller under the Purchase Agreement. at its option. Ele~e-oa~G-&ttorts. s~sR If J')sssessieA af t~a Premises is Rat iiAiA 129 Says alter tt. Lessor may use.3 3. environmental aspects.-b~.000). 3. If saia HJ Say ~erisa. &!. eEiuAeer IRe terms sr smissi~sse~&696&ief1. regardless of Lessor's endorsement of any check so stating. U. In the event that any invoice prepared by Lessor Is Inaccurate such inaccuracy shall not constitute a waiver and Lessee shall be obligated to pay the amount set forth in this Lease Rent for any period during the term hereof which is for less than one full calendar month shall be prorated based upon the actual number of days of said month. Insurance and Real Property Taxes.ilHlekleli\iefW. besser is unable to Elaliuar p&&SE~GGioA ll. on or before the day on which it is due. Lessee agrees to pay to Lessor the sum of $25 in addition to any Late Charge and Lessor. ~ 3. reaWF!allle effsrts ts Eleli er IJBSsessiaR ef IRe Premises te bessea b) IRe GammeAsemeAI Gate. Base Rent shall be abated for the number of days. and/ or to reimburse PAGE 3 OF 23 INITIALS ©2001 -AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 4 . Work better eHesuted ~Fie eM al s~o~sll 6Q. 1. pfiGr Is IRe GeFRmeAsemeAI-Qale-. and compliance with Applicable Requirements and the Americans with Disabilities Act). Eai'l~&l&fh----AR)'-flfO' isle A l'lereiA graAiiA~ bessee Earl) PessessieR er t~e Prell'!lses 1s stJiljeet Ia aAel GsAElllleAee l!j38R the PreFRi&el>-belflg <Waila9le--fef-.1 Term. Ill AeYse lA FiliAg i'RiA Hl iR l'lisl'l e eAt 'Ae Flartles shall be d1ssllargee lram all ellligatiaRs llereuAEier. Lessee shall deposit with Lessor upon execution hereof the Security Deposit as security for Lessee's faithful performance of its obligations under this Lease. In the event that any check .1. ill:! res!lestte IJ:Ie. bessee s11all 13a1 Ia besser aasA maRIA aR amaijRI e(!~o~al Ia aA) a Rer's assssiatieR ar ssRelsmiRiiJm fees Ia• iee er assesses a!.:3 '\ssealatieR Fees lA aeiEiitiaR Ia IRe 8ase ReAl.~l r~et f*&FRI~Jms aRil Ia 3. bessee ma. Acceptance of a payment which is less than the amount then due shall not be a waiver of Lessor's rights to the balance of such Rent.4 Lessee Compliance. bessee &Rail ee re(!u~Ff~ls aeli(latieRs IJReer IRis bease ffeFR aRa alter IRe Start Qate. for Rents which will be due in the future. second to accrued interest. Expiration Date and Original Term of this Lease are as specified in Paragraph 1. Notwithstanding any provision of this Lease to the contrary.3 Abatement of Baee Rent. Payment of Rent shall be made to Lessor at its address stated herein or to such other persons or place as Lessor may from time to time designate in writing. iRsi~EliR€J IRe 13a~ meAt af ReAl.

comply with all Applicable Requirements and take all investigatory and/or remedial action reasonably recommended . ioiJlBR ritte R Fll QioiB&t freFR less er. restoration and/or abatement. judgments. In add ition. and attorneys' and consultants' fees arising out of or involving any Hazardous Substance brought onto the Premises by or for Lessee. is not a Reportable Use. so long as the same will not impair the structural integrity of the improvements on the Premises or the mechanical or electrical systems therein. and the cost of investigation. the environment or the Premises.be&ser te IRe eHieA' AesessaF). claims. creates damage. including . at Lessee 's expense . Lessee shall not engage in any activity in or on the Premises which constitutes a Reportable Use of Hazardous Substances without the express prior written consent of Lessor and timely compliance (at Lessee's expense) with all Applicable Requirements. either by itself or in combination with other materials expected to be on the Premises. etc. use . 6. or release. for the cleanup of any contamination of. but not limited to . (ii) regulated or monitored by any governmental authority. or any third party (provided .. property or the environment created or suffered by Lessee . Lessee shall not cause or permit any Hazardous Substance to be spilled or released in.2 Hazardous Substances. signal and seeing eye dogs. liquid paper. (a) Reportable Uses Require Consent.4(c). but not be limited to. or waste whose presence. by-products or fractions thereof. Notwithstanding anything contained in this Lease PAGE 4 OF 23 INITIALS ©2001 ·AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 5 . Lessee shall within 10 business days after written request therefor deposit monies with Lessor sufficient to restore said Security Deposit to the full amount required by this Lease. or disposal of a Hazardous Substance that requires a permit from. er !Rat Elist~Flls ess~JlaAts ef e~ sa~ses <laFRa!}e te Aei!JRlleriR!l IJFBFRises er ~JrepeFties . contamination . the public. that if Lessee is not in Default of any of its obligations of this Lease. (ii) the generation . If Lessee knows. or has reasonable cause to believe.) and common household cleaning materials. defend and hold Lessor. claim or other documentation which it has concerning the presence of such Hazardous Substance. other than as previously consented to by Lessor.besseFs itA basser as sllall ee &loiflisieAI te Galois a IRa Sas<~ril)' t. and/or is not significantly more burdensome to the Premises . loss or damage which Lessor may suffer or incur by reason thereof. iA besser's reaseRallle jioia!jFReRt. (b) Duty to Inform Lessor. gasoline. that Lessee shall have no liability under this Lease with respect to underground migration of any Hazardous Substance under the Premises from adjacent properties not caused or contributed to by Lessee) . and shall survive the expiration or termination of this Lease. lenders and ground lessor. or any other legal use which is reasonably comparable thereto. security and/or monitoring of the Premises or neighboring properties. or reptiles . Use.e Ia sRall t:la e lt:la ri!JRl Is iRsraasa IRa ear aAG-tear IRa I IRe PreFRises aREI I'0 1klwi~A !!EH~I-saRaitieA bas sea sl:lalklapesit SloiGR aEIEiilieAal FAeRies a FR eA Ei e~ FAa~ s"'ffer as ef bessee-fs. or with respect to which a report. under. removal. If 111e Base ~eAt iRsreases GioiFiR§ tl1e lerFR ef 111is bease. Within 90 days after the expiration or termination of this Lease. but not be limited to. daposiklddilloRal FAeRies ·itn lesser sa tl>atll'le lelal aFRElllA' ar tile S e s~ril) Qape &tt sll all a• all 'tFRes bea r saFRe llfapeFtieA le IRe iRsreasell 9ase ~eAt as-tlle-iR~~I-OOr-e-tiHAe-!Ailial asGaFRFR alilale a FR aterial sl=laA!jB 1Ft tile llllsiRes s ef Ses<Jrit~ Qe~esil Base ReAl. Lessee may use any ordinary and customary materials reasonably required to be used in the normal course of the Agreed Use . and for no other purpose. employees . and does not expose the Premises or neighboring property to any meaningful risk of contamination or damage or expose Lessor to any liability therefor. 9epesil separate ffeFR its !JBAe~al assat. provided. Lessor shall return that portion of the Security Deposit not used or applied by Lessor. fish. or pertaining to or involving any Hazardous Substance brought onto the Premises during the term of this Lease.H. its agents. unless specifically so agreed by Lessor in writing at the time of such agreement. complying with the provisions of Section 7.. Notwithstanding the foregoing. on. hydrocarbons . The term "Hazardous Substance" as used in this Lease shall mean any product.or compensate Lessor for any liability. te asseioiRl fer aR) iRs eases a. (d) Lessee Indemnification. cancellation or release agreement entered into by Lessor and Lessee shall release Lessee from Its obligations under this Lease with respect to Hazardous Substances. so long as such use is in compliance with all Applicable Requirements.. registration or business plan is required to be filed with. and provide Lessor with a copy of any report. storage. under or about the Premises. transportation. Lessee shall not use or permit the use of the Premises in a manner that is unlawful. substance. l esser sllall Rat be re!l"'ireEI te keep lA B S est~ril. without limitation. however. whether or not formally ordered or required. birds. Lessor ma y condition its consent to any Reportable Use upon receiving such additional assurances as Lessor reasonably deems necessary to protect itself. . SllewiEI tR e •gre eEI I tse fle b e 6&00-Gf-l~&&igflee. the Premises and/or the environment against damage . that was caused or materially contributed to by Lessee.-4A. bessee st:lall. Lessor shall not unreasonably withhold or delay its consent to any written request for a modification of the Agreed Use. or about the Premises (including through the plumbing or sanitary sewer system) and sha ll promptly. notice. that a Hazardous Substance has come to be located in. or (iii) a basis for potential liability of Lessor to any governmental agency or third party under any applicable statute or common law theory .OO~Fi Ag-t~s raaseAaela jllS!JFRBAI. expenses. penalties . notice. to bear interest or to be prepayment for any monies to be paid by Lessee under this Lease. petroleum.. use.1 Use. injury and/or liability . expense. disposal. and for the maintenance. the Installation (and removal on or before Lease expiration or termination) of protective modifications (such as concrete encasements) and/or increasing the Security Deposit. If Lessor elects to withhold consent. Lessor shall within 7 days after such request give written notification of same. manufacture. Lessee shall not keep or allow In the Premises any pets. the effects of any contamination or injury to person . safety or welfare. possession.eFRFRereia ll) rea6eAalll e Ia el !lased aA ~ e iR ~Aa A sia l saAEiiltaR. If Lessor properly uses or applies all or any portion of the Security Deposit. remediation. on. then Lessee shall have the right to apply any remaining balance of the Security Deposit to the partial payment of the Base Rent for the last month of the Term of this Lease upon the date Base Rent would otherwise be due for such month. animals . No termination. is either: (i) potentially injurious to the public health. ordinary office supplies (copier toner. (c) Lessee Remediation . Lessee shall indemnify.mls. liabilities. and/or (iii) the presence at the Premises of a Hazardous Substance with respect to which any Applicable Requirements requires that a notice be given to persons entering or occupying the Premises or neighboring properties. l ea se u. any governmental authority. Lessee's obligations shall include. Lessee shall use and occupy the Premises only for the Agreed Use. Other than guide. and/or crude oil or any products. or any third party . "Reportable Use" shall mean (i) the installation or use of any above or below ground storage tank. No part of the Security Deposit shall be considered to be held in trust. if any. by or for Lessee. harmless from and against any and all loss of rents and/or damages. If a GAaflge-iFH. including. Hazardous Substances shall indude . however.rewlt IRereef. which notice shall include an explanation of Lessor's objections to the change in the Agreed Use..)epesil 1&-b&-at-. sigAillsaAtl) reEI~<saEI . transportation . 6. Lessee shall immediately give written notice of such fact to Lessor. glue . waste or a nuisance.

(g) Lessor Termination Option. remediation.ltaR!s RiGR relate iR aRI ffiaRRer te IRe so. condition and repair (whether or not the portion of the Premises requiring repairs. Lessee shall upon request reimburse Lessor for the cost of such inspection. or the means of repairing the same. and Lessor shall proceed to make such remediation as soon as reasonably possible after the required funds are available.2 (Lessor's Obligations). If a Hazardous Substance Condition (see Paragraph 9. pooling. pressure vessels. as and when required by the Applicable Requirements.2(d) and Paragraph 13). in the case of an emergency. Utility Installations. bessGr-!6-IAvesllgallve-aRG-reffiedial-re6fJGAGibil#ies-. Lessee may. any prior use. which result from Hazardous Substances wl'l~ea on the Premises !*iGH&-l:es5ee~AG~r which are caused by lfle-§ros~ligeAG&-Gf-WiiiM-ffii6WflGI!Gt ~Lessor. boilers. materially comply with all Applicable Requirements. 7. eFRffiBRial eRiilies Ra iR§ jiJFlsdiGtion-wi!lol resjlesl Ia the existeAGe ef aRB 11a~ lofaQar£1a~o~s fer aR. Maintenance. dampness or other condition conducive to the production of mold. as ae~Aecl ifl llaFa!Jf3Jli'1 7. notice. at Lessor's option. Likewise. as soon as reasonably possible at Lessor's expense. and Alterations in good order. warning.-iFI-Wilie~l bessee shall ll~Fislble-ler-st~OO-paymeAh Lessee shall cooperate fully in any woo investigative activities at the request of Lessor. for the purpose of inspecting the condition of the Premises and for verifying compliance by Lessee with this Lease . give written notice to Lessee.3 Lessee's Compliance with Applicable Requirements. in which event this Lease shall continue in full force and effect. no matter where located). give written notice to Lessor of Lessee's commitment to pay the amount by which the cost of the remediation of such Hazardous Substance Condition exceeds an amount equal to 4 4-2-times the then monthly Base Rent or $100. keep the Premises. and 14 (Condemnation).2 (Condition). and whether or not the need for such repairs occurs as a result of Lessee's use. Repairs. and shall immediately upon receipt. including allowing Lessor and Lessor's agents to have reasonable access to the Premises at reasonable times in order to carry out any investigation or remediation. restoration and/or abatement. reimburse and hold Lessee. at Lessee's sole expense. Subject to the provisions of Section 55 below. its employees and lenders. Utility Installations Requirements). If Lessor has a reasonable basis to believe that Lessee is not complying with any Applicable Requirements for which Lessee is required to comply with pursuant to this Lease. however. PAGE 5 OF 23 INITIALS ©2001 ·AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 6 . The foregoing exculpation shall not (i) authorize Lessee to continue the use of any such Hazardous Substances. In addition. Trade Fixtures and Alterations. whichever is greater. plumbing. COntraCtOrS or employees.3 (Lessee's Compliance with Applicable and except tO the extent CaUsed by Lessor. Lessee shall. (intended for Lessee's exclusive use. Lessor's agents. the cost of investigation. within 30 days after receipt by Lessor of knowledge of the occurrence of such Hazardous Substance Condition. of Lessor's desire to terminate this Lease as of the date 60 days following the date of such notice. all equipment or facilities. aRB IRe reGeffiFABREiatieRs ef besser's 9R!jiReers aRa'er GeRso. Lessee shall.4 Inspection. citation. ffieas~Jres reEJilireB ay ~e besser slolall relaiR llole res~eRsiailil.a{a) aele ) at IRe Preffiise&. to the extent Lessee becomes aware thereof. Lessee shall immediately give written notice to Lessor of: (i) any water damage to the Premises and any suspected seepage. (e) Lessor Indemnification. notify Lessor in writing (with copies of any documents involved) of any threatened or actual claim. diligently and in a timely manner. electrical. Lessor and its successors and assigns shall indemnify. complaint or report pertaining lo or involving the failure of Lessee or the Premises to comply with any Applicable Requirements. or the inspection is requested or ordered by a governmental authority. the elements or the age or such portion of the Premises).3 (Compliance). this Lease shall terminate as of the date specified in Lessor's notice of termination. Lessee shall provide Lessor with said funds or satisfactory assurance thereof within 30 days following such commitment. except to the extent that Lessee would not otherwise be responsible under this Lease. including. this Lease shall continue in full force and effect. and otherwise at reasonable times after reasonable notice. its agents. or (ii) if the estimated cost to remediate such condition exceeds 4 ~ times the then monthly Base Rent or $100. (f) Investigations and Remediatlons. but not be limited to.000. 6.to the contrary. if required. or (ii) excuse Lessee from any liability resulting from making any such Hazardous Substance Condition worse. Lessee shall provide copies of all relevant material safety data sheets (MSDS) to Lessor within 10 business days of the receipt of a written request therefor. 7. so long as such inspection is reasonably related to the violation or contamination. Compliance.1 Lessee's Obligations. and the requirements of any applicable fire insurance underwriter or rating bureau. In such event. Lessee shall.1 (e)) occurs during the term of this Lease. provide Lessor with copies of all permits and other documents. shall include. harmless from and against any and all environmental damages. and for the avoidance of doubt. Lessor may. 6. including the cost of remediation. defend. provided. unless a violation of Applicable Requirements. Lessor and Lessor's "Lender'' (as defined in Paragraph 30) and consultants shall have the right to enter into Premises at any time. 7. and other information evidencing Lessee's compliance with any Applicable Requirements tO the extent required for COmpliance therewith &j)&Gifi6G-by-l-e6&9f. and shall survive the expiration or termination of this Lease. that Lessee shall have no obligation to remediate any Hazardous Substances that existed within the Premises prior to the Commencement Date. employees and contractors. but subject to Lessor's rights under Paragraph 6.sl:l ReEJ~ireffieRts. The foregoing exculpation shall not (i) authorize Lessee to continue the use of any such Hazardous Substances. Except as otherwise provided in this Lease. removal. fully.000. UAiess sush~~re Is req~. at Lessee's sole expense. fire protection system. whichever is greater. or (ii) excuse Lessee from any liability resulting from making any such Hazardous Substance Condition worse. (a) In General.~lred a&-iH96\I~essee's use {iAshl£1iRg " AIJeralleAs'' . If Lessee does not give such notice and provide the required funds or assurance thereof within the time provided. such as elevators. are reasonably or readily accessible to Lessee. Lessor's obligations. either (i) investigate and remediate such Hazardous Substance Condition. Subject to the provisions of Paragraph 2. The cost of any such inspections shall be paid by Lessor. within 10 business days after receipt of Lessor"s written request. but not limited to .1) is found to exist or be imminent. lighting facilities. within 10 days thereafter. without regard to whether such Requirements are now in effect or become effective after the Start Date. 9 (Damage or Destruction). unless Lessee is legally responsible therefor (in which case Lessee shall make the investigation and remediation thereof required by the Applicable Requirements and this Lease shall continue in full force and effect. 6. In such case. In the event Lessor elects to give a termination notice. 2. Lessee shall have no obligation to remediate any Hazardous Substances that existed within the Premises prior to the Commencement Date. or a Hazardous Substance Condition (see paragraph 9. iR esli~atieRs SullslaAGes eA ~e er reffieBialieR PreFllises ~ bessee's e&S~IlaAG'). HVAC equipment. or (ii) any mustiness or other odors that might indicate the presence of mold in the Premises.

the foundation and load bearing walls. relocating or removing the roof or any existing walls. lighting fixtures. (a) Definitions. employees. will not affect the electrical.-aAS 1 9F 6FR9119 eetestieA. doors. and they expressly waive the benefit of any statute now or hereafter in effect to the extent it is inconsistent with the terms of this Lease. it is intended by the Parties hereto that Lessor have no obligation. other than Utility Installations or Trade Fixtures. the exterior repainting of the Building . Carpeting and Wall COVerings) . plumbing. each month during the remainder of the term of this Lease. Lessor may.3 Utility Installations. Claim or demand. signs. contractors. Removal. Subject to Lessee's indemnification of Lessor as set forth in Paragraph 8. For work which costs an amount in excess of one month's Base Rent. If Lessor shall require for WOrk COSting more than $500. as long as they are not visible from the outside. feef&. at Lessee's sole expense . 7. Trade Fixtures. during the term of this Lease. Lessee shall not make or permit any roof penetrations and/or install anything on the roof without the prior written approval of Lessor. If Lessor elects to participate in any such action. (c) Liens. if and when installed on the Premises: (i) HVAC equipment. or adjacent to the Premises. ceilings. Bonds. "Lessee Owned Alterations and/or Utility Installations" are defined as Alterations and/or Utility Installations made by Lessee that are not yet owned by Lessor pursuant to Paragraph 7.-roof drainage systems . Lessor reserves the right. an amount equal to the product of multiplying the cost of such replacement by a fraction. except to the extent caused by Lessee or any of its agents. on the date on which Base Rent is due. the numerator of which is one. iflsl~lafm. if an item described in Paragraph 7. then such item shall be replaced by Lessor. procure and maintain contracts. indemnifying lessor against liability for the same. claim or demand. Alterations. Lessee shall pay. Notwithstanding the foregoing. (ii) furnishing Lessor with copies of both the permits and the plans and specifications prior to commencement of the work. Lessee shall pay Lessor's attorneys' fees and costs. in keeping the Premises in good order. (b) Consent. to repair and maintain the Premises.2 (Condition). Any Alterations or Utility Installations that Lessee shall desire to make and which require the consent of the Lessor shall be presented to Lessor in written form with detailed plans. and (Iii) compliance with all conditions of said permits and other Applicable Requirements in a prompt and expeditious manner Any Alterations or Utility Installations shall be performed in a workmanlike manneJ with good and sufficient materials. retaining walls. 7. as a precondition to granting such approval. security and fire protection systems. at its sole expense defend and protect itself. for the cost thereof. Lessee shall not make any Alterations or Utility Installations to the Premises without Lessor's prior written consent. 9 (Damage or Destruction) and 14 (Condemnation). shall exercise and perform good maintenance practices. condition and repair. communication cabling. The term "Utility Installations" refers to all floor and window coverings. when due.2 Lessor's Obligations. Surrender. windows. 'fhe term "Alterations" shall mean any modification of the improvements. 2. tt is the intention of the Parties that the terms of this Lease govern the respective obligations of the Parties as to maintenance and repair of the Premises. 7.7 below. parking lots. Lessee shall. perform such obligations on Lessee's behalf. which Claims are or may be secured by any mechanic's or materialmen's lien against the Premises or any interest therein.g. on or about the Premises. Lessee shall. and Lessor shall have the right to post notices of non-responsibility.. and the cost thereof shall be prorated between the Parties and Lessee shall only be obligated to pay.fixtures. floors. (ii) sailer. and put the Premises in good order. all claims for labor or materials furnished or alleged to have been furnished to or for lessee at or for use on the Premises. power panels. in customary form and substance for. and Restoration. then Lessee shall.. driveways. or the equipment therein.3 (Compliance). and fencing in or on the Premises. if any.4(a). upon demand. make non-structural Alterations or Utility Installations to the interior of the Premises (excluding the roof) without such consent but upon notice to Lessor. With respect to any physical changes to the configuration of the Premises. air and/or vacuum lines. assignees. Lessee. aRe jlFessllre essels. 1/144th of the cost per month). landscaping. require Lessee to utilize a contractor chosen and/or approved by Lessor. (i•) laoo~fA!iati9fi--&Y&IeFR&. do not involve puncturing. If Lessee shall contest the validity of any such lien. Consent shall be deemed conditioned upon Lessee's: (i) acquiring all applicable governmental permits. The term "Trade Fixtures" shall mean Lessee's machinery and equipment that can be removed without doing material damage to the Premises. If Lessee fails to perform Lessee's obligations under this Paragraph 7. Lessee shall promptly upon completion furnish lessor with as-built plans and specifications. keep the exterior appearance of the Building in a first-class condition (including. when necessary. sidewalks and parkways located in. foundations. Lessor and the Premises against the same and shall pay and satisfy any such adverse judgment that may be rendered thereon before the enforcement thereof. replacements or renewals when necessary to keep the Premises and all improvements thereon or a part thereof in good order. upon notice to Lessee. and columns. Building facade. plate glass. and with contractors specializing and experienced in the maintenance of the following equipment and improvements.1 Within the applicable notice and CUre period. HVAC equipment. condition and repair. electrical distribution. and the cumulative cost thereof during this Lease as extended does not exceed a sum equal to 3 month's Base Rent in the aggregate or a sum equal to one month's Base Rent in any one year (excluding painting. graffiti removal) consistent with the exterior appearance of other similar facilities of comparable age and size in the vicinity. to procure and maintain any or all of such service contracts . and without relieving Lessee of liability resulting from Lessee's failure to exercise and perform good maintenance practices.--f>. whether by addition or deletion. Lessee may. all of which obligations are intended to be that of the Lessee 8XCept for the roof and the Structural elementS of the Building i. e. (d) Replacement. Lessor may condition its consent upon Lessee providing a lien and completion bond in an amount equal to 150% of the estimated cost of such Alteration or Utility Installation and/or upon Lessee's posting an additional Security Deposit with Lessor. plumbing. PAGE 6 OF 23 INITIALS ©2001 -AIR COMMERCIAL REAL ESTATE ASSOCIATION INITIALS FORM STN-14-4112E Exhibit 1 Page 7 . including. condition and state of repair. with copies to Lessor. Lessor may enter upon the Premises after 10 days' prior written notice to Lessee (except in the case of an emergency. subtenants or invitees. HVAC.<} fG&kGVefi~rcHRSri!Ad (' i) GlarifieFS and (ii) elevators. Lessee shall give Lessor not less than 10 days notice prior to the commencement of any work in. (b) Service Contracts.4 Ownership. and the denominator of which is 144 (ie. however. Subject to the provisions of Paragraphs 2. Lessee shall pay Interest on the unamortized balance but may prepay its obligation at any time. Lessee 's obligations shall include restorations. specifically including the procurement and maintenance of the service contracts required by Paragraph 7. However. (c) Failure to Perform. and Lessee shall promptly pay to Lessor a sum equal to 115% of the cost thereof. Lessee shall furnish a surety bond in an amount equal to 150% of the amount of such contested lien. Notwithstanding the foregoing. in which case no notice shall be required).1 (b) below. and/or life safety systems. fences.1 (b)(i) cannot be repaired other than at a cost which is in excess of 50% of the cost of replacing such item. in any manner whatsoever . on.e. skylights.000. (iii) fire exliAfjlliSAiR!i SlsleFRs. Lessee shall not be required to replace the roof. and Lessee shall reimburse Lessor. walls (interior and exterior).

4(b) hereof.Rootai-V-alu~Mtfing-F-8~1-obtai~f)-IR-feFG&--a-fl&ll&y-ef-il(lli~ffilm~O&&-tlay<lble-IG-!:e&6GF--aFid aR) beRaer. however. Subject to Sections 9 and 14. 8. but shall include coverage for liability assumed under this Lease as an "insured contract" for the performance of Lessee's indemnity obligations under this Lease. If such insurance coverage has a deductible clause. The failure by Lessee to timely vacate the Premises pursuant to this Paragraph 7. the insurance required to be maintained by Lessee. and to any Lender insuring loss or damage to the Premises. (a) Carried by Lessee. and equipment as well as the removal of any storage tank installed by or for Lessee. if this Lease is for 12 months or less. all Alterations and Utility Installations made by Lessee shall be the property of Lessee. 8. Lessee shall provide an endorsement on its liability policy(ies) which provides that its insurance shall be primary to and not contributory with any similar insurance carried by Lessor. and Lessee's personal property shall be insured by Lessee not by Lessor.:!(9) iR e11sess e' Para!lFaflh 8 i:! . except as otherwise expressly indicated in writing by Lessor. shall maintain liabilily SUCh insurance as it deems de&GFilled-l~Fa~ in addition to.Building. Restoration. besse~ifed ~. or license (including. Said policy or policies shall also contain an agreed valuation provision in lieu of any coinsurance clause . any service Contract (as defined in this Lease and the Purchase Agreement). 6. such policy or policies shall insure against all risks of direct physical loss or damage (except the perils of flood and/or earthquake unless required by a Lender). become the property of Lessor and be surrendered by Lessee with the Premises. and inflation guard protection causing an increase in the annual property insurance coverage amount by a factor of not less than the adjusted U. limit the liability of Lessee nor relieve Lessee of any obligation hereunder.QQQ.S. Lessee shall repair any damage occasioned by the installation. Lessee shall surrender the Premises by the Expiration Date or any earlier termination date.QQQ !)er samFBensiR!J prier ta ar exteAiiiA g llEi) aAEl the bease term sl'lall be prarat~FI'esperul le the lease teFm lesser eX£e91-l&-t~e el6ent ef tl=ie sest esGYFFeRse. effective as of the termination of this Lease. and not in lieu of. Trade Fixtures. except to the extent caused by the gross negligence or willful misconduct of Lessor or its agents. Such insurance shall be on an occurrence basis providing single limit coverage in an amount not less than$+ $3. The amount of such insurance shall be equal to the full insurable replacement cost of the Premises. and cause the Premises to be surrendered free of. but in no event more than the commercially reasonable and available insurable value thereof. The policy shall not contain any intra-insured exclusions as between insured persons or organizations. (c) Surrender. or any third party (except Hazardous Substances which were deposited via underground migration from areas outside of the Premises) even if such removal would require Lessee to perform or pay for work that exceeds statutory requirements. By delivery to Lessee of written notice from Lessor not earlier than 90 and not later than 30 days prior to the end of the term of this Lease.3 Property Insurance. FTts ler p9fiG) J)eriaas PayFBeAt shall lle FBaae Bl lessee le itl=liR 1Q Ba)& Ieite iR!l reseipt ef aR iA"aise. Improvements and Rental Value.(a) Ownership. shall constitute a holdover under the provisions of Paragraph 26 below. but considered a part of the Premises. shall also terminate. (b) Removal. as the same shall exist from time to lime. then Lessee shall surrender the Premises in the same condition as delivered to Lessee on the Start Date with NO allowance for ordinary wear and tear.000.000. PAGE 7 OF 23 INITIALS ©2001 ·AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 8 . Lessee shall obtain and keep in force a Commercial General Liability policy of insurance protecting Lessee and Lessor as an additional insured against claims for bodily injury. Premi~.2 Liability Insurance. Subject to Lessor's right to require removal or elect ownership as hereinafter provided. at the expiration or termination of this Lease. I AS~RR!J ll'le loss ef tile r~ll Renller eRe 1 ear 111'1 aR elite AS eEl perle!! ef iRdem~Eklitlonal 18Q da~ s ("ReAtal lla l ~e IRs~. whose insurance shall be considered excess insurance only. without limitation. (b) Carried by Lessor. including coverage for debris removal and the enforcement of any Applicable Requirements requiring the upgrading. waiver of subrogation. the Concession License (as defined in the Purchase Agreement). If the coverage is available and commercially appropriate.000. personal injury and property damage based upon or arising out of the ~ use. Unless otherwise instructed per paragraph 7 . at itS SOle expense. sublease. Lessor may require that any or all Lessee Owned Alterations or Utility Installations be removed by the expiration or termination of this Lease. furnishings. all Lessee Owned Alterations and Utility Installations shall. elect in writing to be the owner of all or any specified part of the Lessee Owned Alterations and Utility Installations.1 Pa~mont For lnsuranoo. The limits of said insurance shalt not. Lessee shall completely remove from the Premises any and all Hazardous Substances brought onto the Premises by or for Lessee. any ground-lessor. appropriate. and Lessee shall be liable for such deductible amount in the event of an Insured Loss $25. at any time . Lessor may . the deductible amount shall not exceed occurrence. with loss payable to Lessor. Indemnity. maintenance or removal of Trade Fix1ures. (a) Building and Improvements. Insurance. occupancy or maintenance of the Premises and all areas appurtenant thereto. Notwithstanding the foregoing. at its sole expense. Lessee shalt add Lessor as an additional insured by means of an endorsement at least as broad as the Insurance Service Organization's "Additional Insured-Managers or Lessors of Premises" Endorsement.4(c) without the express written consent of Lessor or retained by Lessor as Lessor may desire. reconstruction or replacement of any portion of the Premises as the result of a covered loss. Lessee Owned Alterations and Uutity Installations.000 ~ per (bJ Lessee shall require each of its contractors and/or vendors to provide and maintain insurance coverage for general liability. Lessee shall not be named as an additional insured therein. "Ordinary wear and tear" shall not include any damage or deterioration that would have been prevented by good maintenance practice.000 per occurrence with an annual aggregate of not less than~ $5. Lessee owned Alterations and/or Utility Installations . The Insuring Party shall obtain and keep in force a policy or policies in the name of Lessor. Trade Fixtures shall remain the property of Lessee and shall be removed by Lessee.raRee") . Lessor may require the removal at any time of all or any part of any Lessee Owned Alterations or Utility Installations made without the required consent (to the extent that such consent was required). Any personal property of Lessee not removed on or before the Expiration Date or any earlier termination date shall be deemed to have been abandoned by Lessee and may be disposed of In addition. or the amount required by any Lender. parts and surfaces thereof broom clean and free of debris. with all of the improvements. condition and state of repair. 8.nEier allriautal!te to lial!lllly lnsuraAse sarfies G) lesser unaer PaFa!lFafll'l 8. which shall be Lessor. and in good operating order. ordinary wear and tear excepted. Lessee. demolition. auto liability and workers compensation with appropriate limits given their scope of work. Department of Labor Consumer Price Index for All Urban Consumers for the city nearest to where the Premises are located.

damage or liability caused by the gross negligence or willful misconduct of Lessor or its employees or agents. Trade Fixtures.xGept klr l esser's !l ' EISS neulioenGe er tile Prelllises. preteGI. Lessee shall not do or permit to be done anything which invalidates the required insurance policies Lessee shall. Lessee shall provide Lessor with a copy of such endorsement along with the certificate of insurance or copy of the policy required by paragraph 8. A~Rgl ) . The proceeds from any such insurance shall be used by Lessee for the replacement of personal property.8 Exemption of Lessor and Its Agents from Liability. • iti'leYt an. {a) Property Damage. Lessee shall provide Lessor with written evidence that such insurance is in force . loss. Such policy shall include a 'Waiver of Subrogation' endorsement.!Al ef se• era§ a sM!l tie adj ~st e~ 3RR"'all) Ia renest IRe flFajeGieEI-ReAI e tlm~ ise flB) able lly be&see. or any other person in or about the Premises. 8. tJ:ie bessee &Rail pay klr a l a r§er ll ~:~ ihl i~fOO~R a iR§6 a <HeEIIl) besser !list:! are aajaseRI an)'-iAGFeas~e pcell'lilli'Rs ler U>e flFO!!eFI. officers. fferA a REI aga1Rs l any aRd all slai llls. Insurance required herein shall be by companies maintaining during the policy term a "General Policyholders Rating" of at least A-. tJse er esst. Ele'eRd ami t:lelelll armless it~l~r's FRaster er IJ F&t. merchandise or other property of Lessee. or such other rating as may be required by a Lender. or from other sources or places . 8 . Lessee shall hold harmless. water or rain . IR ·a~ se RRB s~ a R ltR. (d) No R9presentation of Adequate Coverage. leakage. steam.9 Failure to Provide Insurance. deliver to Lessor certified copies of policies of such insurance or certificates with copies of the required endorsements evidencing the existence and amounts of the required insurance. bessa a sl:lall iRdaFARii'J. and Lessee Owned Alterations and Utility Installations. 1:\isJ:ie er Is g reate~~ represent&4aif-ilflG-feasooable-sern~e~J:ie-aeE!ilieAai-fi&kJGesls-{f\a\-L-esser-wiiHRG\J~60A ~ssee'G-failiJre-te PAGE 8 OF 23 INITIALS ©2001 ·AIR COMMERCIAL REAL ESTATE ASSOCIATION INITIALS FORM STN-14-4/12E Exhibit 1 Page 9 . IOf-tRe nell! 12 FAGRlR fl9Fied . volunteers and agents (collectively "University") from and against any and all liability. procure and maintain the same. customers . 8. CSU Fullerton Auxiliary Services Corporation and their employees. Lessee shall obtain and maintain Worker's Compensation Insurance in such amount as may be required by Applicable Requirements .~Ad-tlle-ame~. fer aR . Without affecting any other rights or remedies. HVAC or lighting fixtures. If either Party shall fail to procure and maintain the insurance required to be carried by It. invitees.6 Waiver of Subrogation . claims. electricity. The Parties agree to have their respective property damage insurance carriers waive any right to subrogation that such companies may have againsl Lessor or Lessee. or the length of the remaining term of this Lease. Worker's Compensation Insurance. ctaim in order to be defended or indemnified 8.J~~n~na l eAEiers.6. lieRs. VII. defend and hold Lessee harmless from any loss.J~aRG) ef lAB PreFAises B\' bessee. protect. whichever is less. as the case may be. or Lessor may order such insurance and charge the cost thereof to Lessee. eFAissiaRs. appliances. Lessee acknowledges that any failure on its part to obtain or maintain the insurance required herein will expose Lessor to risks and potentially cause Lessor to incur costs not contemplated by this Lease . which amount shall be payable by Lessee to Lessor upon demand.) iRSIJFaAGe ef sssh bt~ihl iR!J er llt~ll!lings if saia insrease Is satJsea ll) bessee's asts. obstruction or other defects of pipes. Lessee shall obtain and maintain insurance coverage on all of Lessee's personal property. (b) Business Interruption.4 Lessee's Property. lt:la-Ba6&-ReAl-&Rall tle a~leFAalisall) iRsreasea.000 ~per occurrence. whether the said injury or damage results from conditions arising upon the Premises or upon other portions of the building of which the Premises are a part. Notwithstanding the negligence or breach of th is Lease by Lessor or its agents. and waive their entire right to recover damages against the other. the extent of which will be extremely difficult to ascertain. damage. j~wlla Rt~dlor liaailllles aFisiR!I aut af. so long as the insurance is not invalidated thereby . Such insurance shall be full replacement cost coverage with a deductible of not to exceed $25. wires . or by any deductibles applicable hereto. wares. expense. but shall not be required to. the State of California. furnish Lessor with evidence of renewals or "insurance binders" evidencing renewal thereof. Lessee and Lessor each hereby release and relieve the other.SaiEI iR ssFaAse sl=lall GeAlaJR aA a§r~i6i~f a A) seiAssraAGe &f a l:l&e:. Lessor shall indemnify. 8. the other Party may. Lessee shall obtain and maintain loss of income and extra expense insurance in amounts as will reimburse Lessee for direct or indirect loss of earnings attributable to all perils commonly insured against by prudent lessees in the business of Lessee or attributable to prevention of access to the Premises as a result of such perils. except to the extent such loss or damage was caused by the gross negligence or willful misconduct of the University. it is intended that Lessee's sole recourse in the event of such damages or injury be to file a claim on the insurance policy{ies) that Lessee is required to maintain pursuant to the provisions of paragraph B. gas.7 Indemnity. Lessee shall. the presence of mold or from the breakage . Business Interruption Insurance. or from any other cause . for loss of or damage to its property arising out of or incident to the perils required to be insured against herein. Such policies shall be for a term of at least one year . Lessor makes no representation that the limits or forms of coverage of insurance specified herein are adequate to cover Lessee's property. !. beseee sJ:i all be llallle fer any lledustillle arAGIJRl ln tile e"aRI ef ~ ~aseRt Pramlso~Premises are jjaFI el ~& . Instead. costs (including without limitation costs and fees of litigation) of every nature arising out of or in connection with Lessee's performance of hereunder or its failure to comply with any of its obligations contained in this Lease. California State University Fullerton. plumb ing . Lessee shall upon notice defend the same at Lessee's expense by joint counsel reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense. defend and indemnify Lessor. neither Lessor nor its agents shall be liable under any circumstances for: (i) injury or damage to the person or goods.8. or (iii) injury to Lessee's business or for any loss of income or profit therefrom. •t:le U6ll aRa'er 966\. at least 10 days prior to the expiration of such policies . (ii) any damages arising from any act or neglect of any other tenant of Lessor or from the failure of Lessor or its agents to enforce the provisions of any other lease in the Project. exisllR!I Base ReAler $Hl0. the Trustees of The California State University. contractors.5. Lessee's employees. business operations or obligations under this Lease. fire sprinklers. m eni~F!~R ti'l eFee' tJ:\alle~ se e sees Aet malrua~u lr ea iA s~ r a RGe aAEI'ar Elee~ wltP-l~ifiGates-eY~~ired reqsireFAeRI fer nellse te bessee. ~ FRaunl eqi!alle iRsrease iR Base ReAl 1 0%-e~BR IR611F3RGe.Jfl3RS) af tRe-PfemfGefr. 8. If any action or proceeding is brought against Lessor by reason of any of the foregoing matters .5 Insurance Policies. whether such damage or injury is caused by or results from fire. besser aAd lllf'*-m1SGGAduGI. cost. directors. indoor air quality. No such policy shall be cancelable or subject to modification except after 6Q 15 days prior written notice to Lessor. Lessor need not have first paid any such The foregoing is subject to Section 8. (c) Worker's Compensation Insurance. {ass ef rentlHHlG/Ilf !laAla!J a&. The effect of such releases and waivers is not limited by the amount of insurance carried or required. Subject to the limitations set forth below in Section 8. prior to the Start Date. as set forth in the most current issue of "Best's Insurance Guide". Trade Fixtures and Lessee Owned Alterations and Utility Installations.

Lessee shall provide Lessor with said funds or reasonably satisfactory assurance thereof within written notice to Lessee within 30 days after receipt by Lessor of knowledge of \he occurrence of such damage. If a Premises Partial Damage that is an Insured Loss occurs. (c) "Insured Loss" shall mean damage or destruction to improvements on the Premises. or (ii) terminate this Lease by giving aS Of the date Of CaSUalty. If the damage or destruction was caused by the gross negligence or willful misconduct of Lessee . provided. Lessor shall make any applicable insurance proceeds available to Lessee on a reasonable basis for that purpose . If Lessee fails to exercise such option and provide such funds or assurance during such period. Total Destruction. make the repair of any damage or destruction the total cost to repair of which is $10. on. 60 days following such Destruction. notwithstanding that there may be some insurance coverage. Lessee shall not be entitled to reimbursement of any funds contributed by Lessee to repair any such damage or destruction.Insured Loss. full replacement cost insurance coverage was not commercially reasonable and available. but the net proceeds of any such insurance shall be made available for the repairs if made by either Party 9. repair such damage as soon as reasonably possible and this Lease shall continue in full force and effect. if the required insurance was not in force or the insurance proceeds are not sufficient to effect such repair. in which case this Lease shall remain in full force and effect.3(a). If Lessee fails to maintain any such insurance. nor relieve Lessee of its obligation to maintain the insurance specified in this Lease.tt~e aqblireEl iAsblrma. in. In such event this Lease shall continue in full force and effect. whether or not an Insured Loss. at Lessor's commercially reasonable expense. Lessor may either: (i) repair such damage as soon as reasonably possible at Lessor's expense. Lessee shall have the right within 10 business days after receipt of the termination notice to give written notice to Lessor of Lessee's commitment to pay for the repair of such damage without reimbursement from Lessor. then Lessor shall. and/or other similar items which Lessee has the responsibility to repair or replace pursuant to the provisions of Paragraph 7. that Lessee shall. 9. Lessor may terminate this Lease effective 60 days following the date of occurrence of such damage by giving a written termination notice to Lessee within 30 days after the date of occurrence of such damage. unless caused by a negligent or willful act of Lessee (in which event Lessee shall make the repairs at Lessee's expense).6. or (ii) the day prior to the date upon which such option expires. Lessor shall have the right to recover Lessor's damages from Lessee. doors. except as provided in Paragraph 8. or under the Premises which requires remediation. such shortage was due to the fact that. Damage or Destruction. Notwithstanding the foregoing. In the event.2 expense. 9. this Lease shall terminate the casualty. Lessor shall notify Lessee in writing within 30 days from the date of the damage or destruction as to whether or not the damage is Partial or Total. a Hazardous Substance . which cannot reasonably be repaired in 6 months or less from the date of the damage or destruction . flood or earthquake shall be subject to Paragraph 9. other than Lessee Owned Alterations and Utility Installations. in such event. then Lessor shall have the right to Obtain SUCh COVerage and reCOVer 110% Of the COSt thereof. 9. then this Lease shall terminate on the date specified in the termination notice and Lessee's option shall be PAGE 9 OF 23 INITIALS ©2001 ·AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 10 . Notwithstanding the foregoing. however. Such iAsrease iA Base ReAl remedy shall in no event constitute a maiAtaiA waiver of Lessee's Default or Breach with respect to the failure to maintain such insurance. If Lessee duly exercises such option during such period and provides Lessor with funds (or adequate assurance thereof) to cover any shortage In insurance proceeds. (b) "Premises Total Destruction" shall mean damage or destruction to the Premises.4 &peGifiea iR IRe tem~iRatiaA A9liGe. other than Lessee Owned Alterations and Utility Installations and Trade Fixtures. if a Premises Total Destruction occurs. in which event this Lease shall continue in full force and effect. the Insuring Party shall promptly contribute the shortage in proceeds (except as to the deductible which is Lessee's responsibility) as and when required to complete said repairs .000 or less. or a contamination by. however. or adequate assurance thereof. (a) "Premises Partial Damage" shall mean damage or destruction to the improvements on the Premises. Lessor shall notify Lessee in writing within 30 days from the date of the damage or destruction as to whether or not the damage is Partial or Total. Premises Partial Damage due to as of the date of casualty. by reason of the unique nature of the improve~ents. or (ii) have this Lease terminate ag ea~s 'l:teFeafter So long as Lessor elects to and does restore the Premises.1 . Notwithstanding the foregoing. Such termination shall be effective 30 days after making such commitment. repair such damage (but not Lessee's Trade Fixtures or Lessee Owned Alterations and Utility Installations) as soon as reasonably possible and this Lease shall continue in full force and effect. including demolition. this Lease shall terminate as of the date of 9. other than Lessee Owned Alterations and Utility Installations and Trade Fixtures. If Lessor receives said funds or adequate assurance thereof within said 10 business day period. and without deduction for depreciation. Partial Damage . Lessor may nevertheless elect by written notice to Lessee within 10 business days thereafter to: (i) make such restoration and repair as is commercially reasonable with Lessor paying any shortage In proceeds. In the event Lessor elects to terminate this Lease. If such funds or assurance are not received. at Lessor's election. and. (d) "Replacement Cost" shall mean the cost to repair or rebuild the improvements owned by Lessor at the time of the occurrence to their condition existing immediately prior thereto. If a Premises Partial Damage that is not an Insured Loss occurs. at Lessor's 9. and Lessor shall proceed to make such repairs as soon as reasonably possible after the required funds are available. If at any time during the last 6 months of this Lease there is damage for which the cost to repair exceeds one month's Base Rent. (e) "Hazardous Substance Condition" shall mean the occurrence or discovery of a condition involving the presence of.1 Definitions. which was caused by an event required to be covered by the insurance described in Paragraph 8.3. the party responsible for making the repairs shall complete them as soon as reasonably possible and this Lease shall remain in full force and effect. prevent the exercise of any of the other rights and remedies granted hereunder. Lessor shall have no obligation to pay for the shortage in insurance proceeds or to fully restore the unique aspects of the Premises unless Lessee provides Lessor with the funds to cover same. debris removal and upgrading required by the operation of Applicable Requirements. 60 gays lalla "tRij 11:\e Sale els~JGR R91iGe. Notwithstanding any other provision hereof. then Lessee may preserve this Lease by. Lessor shall. Premises Partial Damage shall not include damage to windows. if Lessee at that time has an exercisable option to extend this Lease or to purchase the Premises. If Lessee does not make the required commitment. which can reasonably be repaired in 6 months or less from the date of the damage or destruction.5 Damage Near End of Term. within 10 business days following receipt of writlen notice of such shortage and request therefor. (a) exercising such option and (b) providing Lessor with any shortage in insurance proceeds (or adequate assurance thereof) needed to make the repairs on or before the earlier of (i) the date which is 10 days after Lessee's receipt of Lessor's written notice purporting to terminate this Lease. irrespective of any deductible amounts or coverage limits involved.3 Partial Damage • Uninsured Loss.

stoppage. repair or restoration except as provided herein. accident.3 IR tl1e e eRI sf a Breasfl Ill besse&-ffi. or rental levy or tax (other than inheritance.extinguished. furnishings . Lessor may termination of this Lease . Joint Assessment. a change in the ownership of the Premises.7 . 12. of Lessee's election to terminate this Lease on a date not less than 60 days following the giving of such notice. 10. 10. furnishings. Termination. by any authority having the direct or indirect power Ia tax and where the funds are generated with reference to the Building address and where the proceeds so generated are to be applied by the city. personal income or estate taxes). provided that such notice shall be in effective if the restoration work is completed prior to the termination date specified in such notice. Lessee's liability shall be an equitable proportion of the Real Property Taxes for all of the land and improvements included within the tax parcel assessed. In addition to Base Rent. the amount of such equal monthly advance payments shall be adjusted as required to provide the funds needed to pay the applicable taxes. If Lessor is obligated to repair or restore the Premises and does not commence. 10. estimate the current Real Property Taxes . improvement bond. equipment and all other personal property to be assessed and billed separately from the real property of Lessor. If the Premises are not separately assessed. Lessee may. Real Property Taxes . prior to delinquency. If any such installment shall cover any period of time prior to or after the expiration or except that Lessee shall be responsible for all Real Property Taxes for the period prior to the Commencement Date because the parties agreed not to prorate such amounts pursuant to the Purchase Agreement. Lessee shall pay . Assignment and Subletting. such repair or restoration within 90 days after such obligation shall accrue. All other obligations of Lessee hereunder shall be performed by Lessee. then either Party not then in Default of this Lease shall have the right to terminate this Lease by delivery thirty (30) days' prior written notice to the other Party. There shall be no abatement of rent and Lessor shall not be liable in any respect whatsoever for the inadequacy.wl\i6llever first 9GGllfS. an equitable adjustment shall be made concerning advance Base Rent and any other advance payments made by Lessee to Lessor. of all charges jointly metered or billed. If any of Lessee's said property shall be assessed with Lessor's real property. and/or license fee imposed upon or levied against any legal or equitable interest of Lessor in the Premises or the Project.2 Payment of Taxes. remediation . 12. upon demand. strike. Lessee's Remedies. together with any taxes thereon .AIR COMMERCIAL REAL ESTATE ASSOCIATION INITIALS FORM STN-14-4/12E Exhibit 1 Page 11 . trash disposal and other utilities and services supplied to the Premises . such additional sum as is necessary. Lessee shall pay a reasonable proportion. power. If the repair or restoration is commenced within such 30 days.6 Abatement of Rent. repair or other cause beyond Lessor's reasonable control or in cooperation with governmental request or directions. "Commence" shall mean eit~er t~e ~>ASeASilieAal a~J!~arizali9A 9f tAe j3reparatieR at IRe Si!~irea JllaAs. destruction. Upon lermination of this Lease pursuant to Paragraph 6. franchise. this Lease shall continue in full force and effect. remediation or restoration of such damage shall be abated in proportion to the degree to which Lessee's use of the Premises is impaired. 116Ffo~Hls-9bligatieRs IJREier l~is bease. Real Property Taxes shall also include any tax. Lessee shall cause its Lessee Owned Alterations and Utility Installations. the Rent payable by Lessee for the period required for the repair. er the If the restoration work is not completed within six (6) months after it is Commenced. Utility Installations. and require that such taxes be paid in advance to Lessor by Lessee monthly in advance with the payment of the Base Rent. Advance payments may be intermingled with other moneys of Lessor and shall not bear interest. "assign or assignment") or sublet all or any part of Lessee's interest In this Lease or in the Premises without Lessor's prior written consent PAGE 10 OF 23 INITIALS ©2001. special . In the event of Premises Partial Damage or Premises Total Destruction or a Hazardous Substance Condition for which Lessee is not responsible under this Lease. mortgage or encumber (collectively.1 Definition.-{Re ll=leR aR)'-GIJGh aEI aR se ~~94-b/ l esser as aR atlailieFial Se s~r111 98116&11. (a) Lessee shall not voluntarily or by operation of law assign. beginning of the actual work on the Premises. To the extent caused by Lessor's gross negligence as willful misconduct Base Rent shall be abated during any period in which utility service is interrupted and that prevents Lessee from using the Premises.1 Lessor's Consent Required. and/or Lessor's business of leasing.. business days after receipt of a written statement setting forth the taxes applicable to Lessee's Utilities and Services. Trade Fixtures . (b) Remedies. but (for any SUCh event during the first three (3) years of the Term) not to exceed the proceeds received from the Rental Value insurance.2(g) or Paragraph 9. Advance Payments.. including but not limited to. and (ii) levied or assessed on machinery or equipment provided by Lessor to Lessee pursuant to this Lease. transfer. gas. as extended for delays caused by Lessee. 11. assessment or charge . If any such services are not separately metered or billed to Lessee. heat. labor dispute. all taxes assessed against and levied upon Lessee Owned Alterations. general. Lessee shall pay for all water. When possible. fee. or any increase therein : {i) imposed by reason of events occurring during the term of this Lease . the term "Real Property Taxes" shall include any form of assessment. Lessee shall pay Lessor the taxes attributable to Lessee's property within 10 property . telephone. Lessor shall. in addition. In the event Lessee incurs a late charge on any Rent payment. this Lease shall terminate as of the date specified in said notice. or is not then required to be . give written notice to Lessor and to any Lenders of which Lessee has actual notice. If the amount collected by Lessor is insufficient to pay such Real Property Taxes when due.. at any time prior to the commencement of such repair or restoration. Lessor's right to other income therefrom. 10. ordinary or extraordinary. county or other local taxing authority of a jurisdiction within which the Premises are located. 9. Lessee's share of such installment shall be prorated. interruption or discontinuance of any utility or service due to riot. Lessee shall pay to Lessor an amount equal to the Real Property Tax installment due at least 20 days prior to the applicable delinquency date. in a substantial and meaningful way. Trade Fixtures. Lessee shall pay Lessor. real estate. equipment and all personal property of Lessee . breakdown . As used herein. 9. When the actual amount of the applicable tax bill is known. Such monthly payments shall be an amount equal to the amount of the estimated installment of taxes divided by the number of months remaining before the month in which said installment becomes delinquent. return to Lessee so much of Lessee's Security Deposit as has not been . such proportion to be conclusively determined by Lessor from the respective valuations assigned in the assessor's work sheets or such other information as may be reasonably available. levy. light. used by Lessor 10. to be determined by Lessor. and Lessor shall have no liability for any such damage. If Lessee gives such notice and such repair or restoration is not commenced within 30 days thereafter. (a) Abatement.4 Personal Property Taxes.

1 by Lessor shall be limited to compensatory damages and/or injunctive relief. control or assets of Lessee to a Successor or Affiliate (each.Notwithstanding anything set forth above. or to effect a transfer of ownership. Further. a "Permitted Tran6fer") without the prior consent of Lessor to any Successor (hereinafter defined) or Affiliate (hereinafter defined). (c) lessor's consent to any assignment or subletting shall not constitute a consent to any subsequent assignment or subletting .(§~ll~Ra~ Re aGGi!J Ree OF 6 t~ll lessee-aR~OO~~ erigiRal bessee ~~ ~ IRis l ease llF!Iess &ll GR traAs fer is spaEilfi e. 12 .. ef 26~~ er FA ore ef IRe atiAg seA' rei ef lessee-ol=ialk&A&lilule-a ~~ 5-9~ (s) Ti'le iA al aFAeAt af bassee ar its assets iR BRI traRsaG!iaA. The following te rms and conditions shall apply to any subletting by Lessee of all or any part of the Premises and shall be deemed included in all subleases under this Lease whether or not expressly incorporated therein : (a) Lessee hereby assigns and transfers to lessor all of Lessee's interest in all Rent payable on any sublease. or any security held by Lessor. increase the monthly Base Rent to 110% of the Base Rent then in effect Further. be a Default curable after notice per Paragraph 13. or entering into possession of the Premises or any portion thereof...1(c). er as it eK-i&IIH~ tra A&a stieA er traF!sa sUeAs se R s lit~<li A!l &ll&R re EIYGtlert A'1a) 111slle e ~re ate r. controls or is controlled by.ease-&HJ4. other than such obligations as are contrary to or inconsistent with provisions of an assignment or sublease to which Lessor has specifically consented to In writing. accompanied by information relevant to lessor' s determination as to the financial and operational responsibility and appropriateness of the proposed assignee or sublessee.3 riliAg . sllall be G eF~sidflfed-a~ e A I ef tills lease Ia ilRRela its seAs a AI. to be used by a third party vendor in connection with the installation of a vending machine or payphone shall not constitute a subletting. fll) 1 'Riess bes see is a sarporatieA aRd Us st aG!< Is pllllli&ll trades on a Aalte Ral stesll ellsR aR!Je. (e) Lessee's remedy for any breach of Paragraph 12 . or a noncurable Breach without the necessity of any notice and grace period . "Affiliate" is defined as any corporation or entity that through one or more intermediaries.-le'leFag~I-GH)the!wiseh--wRether ar Ret a farmal-a&&igAA'1GRI er R)f3Gtl=leGati~Ris bease ar bessee' s as~F&. entering into such sublease. (d) In the event of any Default or Breach by lessee. "Succeeeor" is defined as any corporation or entity resulting from a merger or consolidation with Lessee or any corporation or entity succeeding to substantially all of the business and assets of Lessee. (b) lessor may accept Rent or perfonnance of lessee's obligations from any person other than Lessee pending approval or disapproval of an assignment Neither a delay In the approval or disapproval of such assignment nor the acceptance of Rent or performance shall constitute a waiver or estoppel of Lessor's right to exercise its remedies for Lessee's Default or Breach . (ii) release Lessee of any obligations hereunder. such transaction . (g) Notwithstanding the foregoing. no assignment or subletting shall : (i) be effective without the express written assumption by such assignee or sublessee of the obligations of Lessee under this Lease. or is under common control with. flAaRsi~&fef. "Net . any change of ownership resulting in a change of majority control from those persons or entities not having control shall not be deemed an assignment or transfer requiring Lessor's consent.eFtA ef bessee" &Rail A'1eaA IRe 11et "'iGR l ess er eAR sf lessee (el< GI~JeiR!J aA~ !JilaraRiers) estalllisRea I!Rder §eAerall~ asse~tea 3GG 9Y RliR!j iJ FI RGijll&&.4laAga iA IRa seAi ral af bessee sRall saA s tl tt~le aR assigAmefll F aE!t~iri R!J seAs eAt The traRsfer. condition and obligation herein to be observed or performed by Lessee during the term of said assignment or sublease. without first exhausting Lessor's remedies aga inst any other person or entity responsible therefor to Lessor. ar series af traAsastiaRs (ll) a1 af A'1eF!JeF. however. Lessee may collect said Rent. Lessee agrees to provide Lessor with such other or additional information and/or documentation as may be reasonably requested . nor prohibit. f) Lessor may reasonably withhold consent to a proposed assignment or subletting if Lessee is in Default at the time consent is requested . (e) Each request for consent to an assignment or subletting shall be in writing .e tiA'1e er tile eH e & t~ ll&FI-Of. any public offering or transfer in which all or a portion of Lessee's stock shall be sold or traded on a nationally recognized stock exchange or on the "over-the-counter" market or the sale of Lessee's stock on a nationally recognized stock exchange or over-the-counter-market shall not be deemed an assignment for the purposes of this Lease and nothing in this Article shall be applicable to. If Lessor elects to treat such unapproved assignment or subletting as a noncurable Breach.. ~Is~ rest~lts er ill res t~lliA a redl:IGli&fH:IHl1e-Nei-War411 ef bes&ee 11 ... an y Guarantors or anyone else responsible for the performance of Lessee's obligations under this Lease. a "Permitted Tran6feree"). allowing a de minimis portion of the Premises. by reason of accepting such assignment.e~F169Al-te-a~e. 20 square feet or less. this Lease shall. in the event of such Breach and rental adjustment.1~me-okl1tHno&I -H!GeAl-a&&ijj~~G!l besser has GaAseRles .a. by contract or otherwise). whether through the ownership of voting securities. and (ii) all fixed and non-fixed rental adjustments scheduled during the remainder of the Lease term shall be increased to 11 0% of the scheduled adjusted rent. ie. (it-l. In the event that the amount collected by Lessor exceeds Lessee's then outstanding obligations PAGE 11 OF 23 INITIALS ©2001 -AIR COMMERCIAL REAL ESTATE ASSOCIATION INITIALS FORM STN-144/12E Exhibit 1 Page 12 . asE1t~isitiaR. if any.2 Terms and Conditions Applicable to Assignment and Subletting. Lessor may either: (i) terminate this Lease. (See F'ara gFa!')l:l 39 2) Additional Terms and Conditions Applicable to Subletting. including but not limited to the intended use and/or required modification of the Premises. at Lessor's option.lhl!H. together with a fee of $500 as consideration for Lessor's considering and processing said request. Lessor's that requires Lessor's consent (d) An assignment or subletting without consent shall. (a) Regardless of Lessor's consent. (i) the purchase price of any option to purchase the Premises held by Lessee shall be subject to similar adjustment to 110% of the price previously in effect. covenant. including any assignee or sublessee. provided. or sublessee under. be deemed to have assumed and agreed to conform and comply with each and every term. Notwithstanding anything set forth above.all) GaAseA tea to ~~~ besso r iR 12 . eA a st~ ml! latl e bas is. sale . (See also Paragraph 36) (f) Any assignee of. or (iii) alter the primary liability of Lessee for the payment of Rent or for the performance of any other obligations to be performed by Lessee. and Lessor may collect such Rent and apply same toward Lessee's obligations under this Lease . 31'1 aA'10ilRI !Jfeater thaR 25~4 ef st~GR Net Wa RR as 11 as re!lr ase11lell at tJ. Lessee may assign this Lease or sublet the Premises or any portion thereof (herein. Lessor may proceed directly against Lessee. or (ii) upon 30 days written notice. Lessee ("control" meaning the possession of the power to direct or cause the direction of the management and policies of an entity. that until a Breach shall occur in the performance of Lessee's obligations.

(b) The failure of Lessee to make any payment of Rent or any Security Deposit required to be made by Lessee hereunder. and not affect the validity of the remaining provisions (g) The discovery that any financial statement of Lessee or of any Guarantor given to Lessor was materially false. covenants. provided. and/or an illegal activity on the Premises by Lessee. (ii) becoming a "debtor" as defined in 11 U. such provision shall be of no force or effect.3 is jeopardized as a result thereof. if any. or (v} a Guarantor's breach of its guaranty obligation on an anticipatory basis. Any agreement with Lessee's Permitted Users shall be subordinate to and subject to the terms of this Lease. Lessee shall have the right to sublet or permit third parties to occupy and use portions of the Premises for (a) weekend use by religious organizations. and in the event of the termination of this Lease. covenants. (c) Any matter requiring the consent of the sublessor under a sublease shall also require the consent of Lessor. in the case of a petition filed against Lessee. when coupled with the then existing resources of Lessee. upon receipt of a written notice from Lessor stating that a Breach exists in the performance of Lessee's obligations under this Lease. to provide written alternative assurance or security.C. specified in such notice The sublessee shall have a right of reimbursement and offset from and against Lessee for any such Defaults cured by the sublessee. §1 01 or any successor statute thereto (unless. license. (iii) the appointment of a trustee or receiver to take possession of substantially all of Lessee's assets located at the Premises or of Lessee's interest in this Lease. A "Default" is defined as a failure by the Lessee to comply with or perform any of the terms. Lessee. provided. where such actions continue for a period of 3 days following written notice to Lessee.S. within 15 . +the failure by Lessee to provide (i) reasonable written evidence of compliance with Applicable Requirements. or the vacating of the Premises without providing a commercially reasonable level of security. or other agreement with any Permitted User prior to the date on which such Permitted User takes possession of any portion of the Premises. where such failure continues for a period of 3 5 business days following written notice to Lessee. be deemed liable to the sublessee for any failure of Lessee to perform and comply with any of Lessee's obligations to such sublessee.AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 13 . however. equals or exceeds the combined financial resources of Lessee and the Guarantors that existed at the time of execution of this Lease. and Lessee's failure. to provide reasonable evidence of insurance or surety bond. or (iv) the attachment. (iv) an Estoppel Certificate or financial statements. then it shall not be deemed to be a Breach if Lessee commences such cure within said 30 day period and thereafter diligently prosecutes sucih cure to completion. 5 business (d) To the extent required by this Lease. that if the nature of Lessee's Default is such that more than 30 days are reasonably required for its cure. (vi) evidence concerning any guaranty and/or Guarantor. however. (f) The occurrence of any of the following events: (i) the making of any general arrangement or assignment for the benefit of creditors. (iv) a Guarantor's refusal to honor the guaranty. where any such failure continues for a period of 10 days following written notice to Lessee. Remedies. 12. where such Default continues for a period of 30 days after written notice. or without providing reasonable assurances to minimize potential vandalism. 13. all such agreements with Permitted Users shall automatically terminate.1(a). when due. in which event Lessor shall undertake the obligations of the sublessor under such sublease from the time of the exercise of said option to the expiration of such sublease. within 60 days following written notice of any such event. where possession is not restored to Lessee within 30 days. at any time and from time to time during the Term of this Lease. the same is dismissed within 60 days). or to fulfill any obligation under this Lease which endangers or threatens life or property.1-Q (Or any Other longer notice PAGE 12 OF 23 INITIALS ©2001. Lessor may. who shall have the right to cure the Default of Lessee within the grace period. provided. Lessor shall not be liable for any prepaid rents or security deposit paid by such sublessee to such sublessor or for any prior Defaults or Breaches of such sublessor. 13. other than those described in subparagraphs 13. execution or other judicial seizure of substantially all of Lessee's assets located at the Premises or of Lessee's interest in this Lease. at its option. and/or (b) educational purposes (each such third party a "Permitted Ued'. (ii) the service contracts. where such seizure is not discharged within 30 days. (b). or (ix) any other documentation or information which Lessor may reasonably require of Lessee under the terms of this Lease. notwithstanding any claim from Lessee to the contrary. The foregoing does not constitute an operating covenant. (ii) the termination of a Guarantor's liability with respect to this Lease other than in accordance with the terms of such guaranty. THE ACCEPTANCE BY LESSOR OF A PARTIAL PAYMENT OF RENT OR SECURITY DEPOSIT SHALL NOT CONSTITUTE A WAIVER OF ANY OF LESSOR'S RIGHTS. conditions or Rules and Regulations under this Lease. above. A "Breach" is defined as the occurrence of one or more of the following Defaults. (b) In the event of a Breach by Lessee. Breach. (viii) material safety data sheets (MSDS). whether to Lessor or to a third party. Sublessee shall rely upon any such notice from Lessor and shall pay all Rents to Lessor without any obligation or right to inquire as to whether such Breach exists. Lessee shall notify Lessor of any sublet. and the failure of Lessee to cure such Default within any applicable grace period: (a) The abandonment of the Premises. require sublessee to attorn to Lessor. (c) or (d). or of the rules adopted under Paragraph 40 hereof. in the event that any provision of this subparagraph is contrary to any applicable law.any such excess shall be refunded to Lessee. conditions or provisions of this Lease. INCLUDING LESSOR'S RIGHT TO RECOVER POSSESSION OF THE PREMISES. to pay to Lessor all Rent due and to become due under the sublease. (iii) a Guarantor's becoming insolvent or the subject of a bankruptcy filing.1 Default. If Lessee fails to perform any of its affirmative duties or obligations.4 Permitted Ueere. license or otherwise permit Permitted Users to use and occupy all or any portion of the Premises without Lessor's consent.2 Ramadlas. (d) No sublessee shall further assign or sublet all or any part of the Premises without Lessor's prior written consent. (e) Lessor shall deliver a copy of any notice of Default or Breach by Lessee to the sublessee. (iii) the rescission of an unauthorized assignment or subletting. Lessee hereby irrevocably authorizes and directs any such sublessee. Notwithstanding the foregoing provision of Section 12. however. 13. (v) a requested subordination. (h) If the performance of Lessee's obligations under this Lease is guaranteed: (i) the death of a Guarantor. Breach. Default. (c) The failure of Lessee to allow Lessor and/or its agents access to the Premises or the commission of waste. (e) A Default by Lessee as to the terms. by reason of the foregoing or any assignment of such sublease. or where the coverage of the property insurance described in Paragraph 8. nor by reason of the collection of Rent. Lessor shall not. act or acts constituting public or private nuisance. which. shall have the right to sublet. (vii) any document requested under Paragraph 42.

Lessee shall pay to Lessor an amount equal to 115% of the costs and expenses incurred by Lessor in such performance upon receipt of an invoice therefor. Lessee shall not be in Breach of this Lease provided that Lessee commences the cure of such matter within the specified period and thereafter diligently prosecutes it tO COmpletion Within a period that dOeS not exceed 180 days. become due and payable quarterly in advance.:3 IAB009RI9RI RaGapt~r-e. or governmental licenses. or Lessor may reserve the right to recover all or any part thereof in a separate suit.ee~meAtS. (iii) the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss that the Lessee proves could be reasonably avoided. asIa sst. all el •llisll GllRGessieAs are lle<GiAalter referral! ~peR besooe's 1~11 aAa faiti=IMiiBRGR11aAse ef all ef tl1e terms. Lessor shall have the right to recover in such proceeding any unpaid Rent and damages as are recoverable therein. nor prevent the exercise of any of the other rights and remedies granted hereunder. Acceptance of such late charge by Lessor shall in no event constitute a waiver of Lessee's Default or Breach with respect to such overdue amount. Efforts by Lessor to mitigate damages caused by Lessee's Breach of this Lease shall not waive Lessor's right to recover any damages to which Lessor is otherwise entitled. perform such duty or obligation on Lessee's behalf. including but not limited to the cost of recovering possession of the Premises. that if such obligation cannot reasonably be cured within such 15-day (or other longer specified) period. then Lessor shall not be in breach if performance is commenced within such 30 day period and thereafter diligently pursued to completion.rle ~sa Gr ef. and that portion of any leasing commission paid by Lessor in connection wilh this Lease applicable to the unexpired term of this Lease. 13. +lle asGeiJiaAse e.-Y~>GA-ilf'-eaGA-eHI:iis. however.1. not received by Lessor. If termination of this Lease is obtained through the provisional remedy of unlawful detainer. and (iv) any other reasonable amount necessary to compensate Lessor for all the detriment proximately caused by the Lessee's failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom. however.-Gr-the 31st day after it was due. The interest (''Interest") charged shall be computed at the rate specified in the Wall Street Journal as the "prime rate" plus 3% ~per annum but shall not exceed the maximum rate allowed by law. for 3 consecutive installments of Base Rent. a notice to pay rent or quit. then notwithstanding any provision of this Lease to the contrary. 1:3. If a notice and grace period required under Paragraph 13.al~t be E!eeFRe9 a ai er by besser ef IAe rlii AO l:l. !li eA er !)aiEl ll)' lesser 1:1~A iRel~:~oomeRI Pre isieA sl1all be ii'Affle6. when due as-te SGRediJ I BEI~JaymeAis (SliGR as Ba~a1 s felle 'iAglhe ea'e aA htGA it· ·as-diJ&-fOHle~kltl-paymeat. besser ef reRt er IRe sl!re ef lAB Qreasll ·l:l~tell ~ir. reasonable attorneys' fees. and without limiting Lessor in the exercise of any right or remedy which Lessor may have by reason of such Breach: (a) Terminate Lessee's right to possession of the Premises by any lawful means.4. The expiration or termination of this Lease and/or the termination of Lessee's right to possession shall not relieve Lessee from liability under any indemnity provisions of this Lease as to matters occurring or accruing during the term hereof or by reason of Lessee's occupancy of the Premises. Base Rent shalL at Lessor's option.lalei~AE! pa~ able 13) bessee te besser. in which case this Lease shall terminate and Lessee shall immediately surrender possession to Lessor. In such event Lessor shall be entitled to recover from Lessee: (i) the unpaid Rent which had been earned at the time of termination. The Parties hereby agree that such late charge represents a fair and reasonable estimate of the costs Lessor will incur by reason of such late payment. permits or approvals. The worth at the lime of award of the amount referred to in provision (iii) of the immediately preceding sentence shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of the District within which the Premises are located at the time of award plus one percent. Any monetary payment due Lessor hereunder. aslo ReA ssl1e<l1led fl3)~i6. the applicable grace period required by Paragraph 13. provided. In the event that neither Lessor nor Lender cures said breach within 30 days PAGE 13 OF 23 INITIALS ©2001 -AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 14 . sa eRaAts aAa seAeilieAs e41li&aase. For purposes of this Paragraph. processing and accounting charges. Lessor may. and the failure of Lessee to cure the Default within the greater of the two such grace periods shall constitute both an unlawful detainer and a Breach of this Lease entitling Lessor to the remedies provided for in this Lease and/or by said statute. Lessee shall immediately pay to Lessor a one-lime late charge equal to . in which event Lessee may sublet or assign. that if the nature of Lessor's obligation is such that more than 30 days are reasonably required for its performance.period to which Lessee is entitled under this Lease) days after written notice (or in case of an emergency. including but not limited to the obtaining of reasonably required bonds. whichever is greater (which shall be waived once every twelve (12) months of the Term) . Lessee el aR) sasll er Giller 0 lleFl<~S . and any Lender whose name and address shall have been furnished Lessee in writing for such purpose. In the event of a Breach. In the event that a late charge is payable hereunder. including necessary renovation and alteration of the Premises. 13. I AEI~se>l'!eAl ~-&a~isf&Rs. other than late charges. and late charges which may be imposed upon Lessor by any Lender. (ii) the worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that the Lessee proves could have been reasonably avoided. without notice). shall not constitute a termination of the Lessee's right to possession. a reasonable time shall in no event be less than 30 days after receipt by Lessor. but are not limited to. (b) Continue the Lease and Lessee's right to possession and recover the Rent as it becomes due. and/or the appointment of a receiver to protect the Lessor's interests.-bea~~t:!<~GemeAt Pre isief1--Sflall-automatiGally-OO-tleemeG-eeletet:!--ffam-tAi&-tease-aAG-Gf.6 Breach by Lessor. with or without further notice or demand. the exact amount of which will be extremely difficult to ascertain. without any requirement for notice to Lessee.-par-agrapll l!Aiess s~esiliGally-&e-6laleEI lA 13. of written notice specifying wherein such obligation of Lessor has not been performed. shall bear interest from IRe-<la~~e. expenses of relelting. Accordingly. In such case. efforts to relet.1 was not previously given.w 5% of each such overdue amount or $100.. provided.5 Interest. er klr lAB gl <iflg er JiayiA§ b) besser le Bf fGr Gr sens ille atkl~ sllall be seemeli GeAEII'ieReEI ler lessee's e RI~i s bease. Lessor may. whether or not collected. subject only to reasonable limitations Acts of maintenance.lesl. a~~eflt-Qf-6GR&illenHi~teEI . Lessor shall not be deemed in breach of this Lease unless Lessor fails within a reasonable time to perform an obligation required to be performed by Lessor. at its option. besser at IRe lime ef StJGR asseplaf!Ge- Lessee hereby acknowledges that Ia te payment by Lessee of Rent will cause Lessor to incur costs not contemplated by this Lease. tile eperalieA ef tFtis pa~pi:H. or to perform or quit given to Lessee under the unlawful detainer statute shall also constitute the notice required by Paragraph 13. then.1 and the unlawful detainer statute shall run concurrently. insurance policies. (c) Pursue any other remedy now or hereafter available under the laws or judicial decisions of the state wherein the Premises are located. RBI illlslaR4l~9seEjueffi-oore ef saia Breasl1 b} Lessee . (b) Performance by Lessee on Behalf of Lessor.l:. Interest is payable in addition to the potential late charge provided for in Paragraph 13. if any Rent shall not be received by Lessor within 5 days after such amount shall be due.4 Late Charges. (a) Notice of Breach." A)' agr-eemeA~baleEi FEIRt Gr eti'ler Gllar~es . Such costs include.

for purposes of Condemnation only.Gf. then Lessee shall have the right to offset the balance thereof against Base Rent. (ii) lhere are no uncured defaults in the Requesting Party's performance .3 Representations and Indemnities of Broker Relationships. er !Ill lf-8a66-Re11t is iRsreaseEI .e Ile -a tAirEI JlaFI) IleA~} semmisshm-agreemeAI eAtereEI lAta 13) aAEI'er l:re~ eaR be669HIAEI besser's 8rekar f!lr tl1e limitei:J Jlldepese el selleG!iA!J aAi' erekeFII§e4ee-ewe9. inducting any costs. Lessee may. Condemnation awards and/or payments shall be the property of Lessor.er i& greater f!lr remaiAeler ef t~e bease. IlleR. this Lease shall terminate as to the part taken as of the date the condemning authority takes title or possession. the Requesting (b) If the Responding Party shall fail to execute or deliver the Estoppel Certificate within such . 15. loss of business goodwill and/or Trade Fixtures. .after receipt of said notice. IRe 8lEleAt sf E!ll~lliGUI4-te-a66ertaifl. however. IReA &ldGIHIR'!WAt&-6Rall assr"'e IA!eresl. at Lessee's option.2 e&ll9ati&El41~~~~~~ tFie pre rlsieRs el Paragrapl'ls 1. not more than one and any other information reasonably requested by the Requesting Party. month's rent has been paid in advance Prospective purchasers and encumbrancers may rely upon the Requesting Party's Estoppe l Certificate. ReRt er $1 QQ. acknowledge and deliver to the Requesting Party a statement In writing in form similar to the then most current "Estoppel Certificate" form published by the AIR Commercial Real Estate Association. is entitled to any commission or finder's fee in connection herewith. confirmation and/or statements as may be reasonably requested by the Requesting Party . except that the Base Rent shall be reduced in proportion to the reduction in utility of the Premises caused by such Condemnation . 'dditleRal CemmissleR . asserelallse •rit~se~l:lal!--{aT--U-~~ersises aRy O!llieR. (c) Except to the extent that Lessee or Guarantor is a public company and provides financial StatementS On-line.. PAGE 14 OF 23 ©2001 • AJR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 15 . RiGA •ill I:Je a req"'e&'eel Esia~pel GeFt~lmel~ lasFiieA IR9 ltl:lauh:IA~iremeRI f!lr Aetise te bessae . Lessee and Lessor each represent and warrant to the other that it has had no dealings with any person. In the event that this Lease is not terminated by reason of the Condemnation.. lA a!IGil~WF-Iail~ aA) ame1. 20 day period. ll.!SA failldre aRe if lesser fails Ia IJa) saiel meAie64G-its-BFGket-a~fRelfAt&-a~iAst ReAl. &Re\JIEI IRe be&sae Iaiiie Bll~eli• er moAti:ll) Base FleRl&Fiall lle a~o~tematlsally IAGrease!f .Ai>G&r~l). alter IJ:la elC~~ Mltler by agreemeRl or G~JoratleA af aA essalatieA sta\Jse 11ereiR. then Lessee may elect to cure said breach at Lessee's expense and offset from Base exceed an amount equal to tFie !Jreater ef Rent the actual and reasonable cost to perform such cure. finder or other similar party by reason of any dealings or actions of the indemnifying Party. that Lessee shall be entitled to any compensation paid by the condemnor for Lessee's relocation expenses . All Alterations and Utility Installations made to the Premises by Lessee. or for severance damages. Brokerage Fees. or sell the Premises. from Lessor for any such expense in excess of such offset. If a seJlarate erellera§e fee a§reeFReAt is attastleel !FleA iR aelelitieA Is IF!e pa. the value of the part taken. reserving Lessee's right to seek reimbursement If Lessee obtains a final judgement for any such sum and Lessor fails to timely pay such judgement. within 10 terminate this Lease as of the date the condemning authority takes such possession. Estoppel Certificates. 9a~e&it. Assumptkm-of. baase. seRG ~Ats-wi\ll~eHlaki-AGtlsa..9. shall be considered the property of the Lessee and Lessee shall be entitled to any and all compensation which is payable therefor. iiRrA 1 ~~~maifl&. including but not limited to Lessee's financial statements for the past 3 years. however. attorneys' fees reasonably incurred with respect thereto .W Party may execute an Estoppel Certificate stating that: (i) the Lease is in full force and effect without modification except as may be represented by the Requesting Party. (13) if \R bessee asq"'lres aAy rlgnls Ia lhe Premises er aiF!er ~ Red ll 1 bessar a REI tooatea llh IRe seA&eAI ltFiiA !Fie same Praje&l. or if having commenced said cure they do not diligently pursue it to completion. aA amallAt eqllalts 19~' afiRe t~eA e11istiF!~ Base l\lelle. Condemnation.Obl~&r-AFI)'-b~fafl&fefee. firm.lA pessessieA ef tile Premises. refinance . this Lease shall remain in full force and effect as to the portion of the Premises remaining. protect.-bessea's Bfol<er sl:!all be aeamoa I. expenses . All such financial statements shall If Lessee does not maintain financial statements separate from Guarantor. Lessee and all Guarantors shall within 10 days after written notice from Lessor deliver to any potential lender or purchaser designated by Lessor such financial statements as may be reasonably required by such lender or purchaser. if any) in connection with Uhis Lease. and (iii) if Lessor is the Requesting Party. then it shall not be required to provide separate be received by Lessor and such lender or purchaser in confidence and shall be used only for the purposes herein set forth...!GR llrekera!je fee a§reemeAI.perta!Ring-t~th!s-keaS&-WReR aue. 15.1Rls te be&&ee!G-8f91\~ker ma. and the Responding Party shall be estopped from denying the truth of the facts contained in said Certificate . If er bessor. provided. that such offset shall not eRe two (2) month's Base Rent or the Seellrit. is taken by Condemnation. 22 aRe 31 II besser falls te pay ta Brokers aAy aR'!WA\&4\ls as aml fer llrek€fage-fees. (a) Each Party (as "Responding Party'') shall within -W 20 days after written notice from the other Party (the "Requesting Party") execute.. +l=le PaFlies a!jrae IF! aI s~:~GI'I iAsrease iA Base ReRI represeRIG lair aREI reaseAiHI!e sem~eF!salieA ler IRa aeiEI IUaRal rls~se&ls t~al 1 essar-wlli-IF~Wr ReAl st1all iA Ae e eAt saRstiMe a • ai •er ef bessea's ll) r easeA el bessee·s ra~iae IRe EsiB!Jflel Ce~~ ble~r-Bfea61T. 16. provided . plus such additional information. lA aEI~itieA. lii .--lflall said named Brokers.1 F!afa~oo~~HIRd-lile-84'-okeHH»I:Ielwlse a§ree iR ~R)'6A8-V~I i alea aA. If Lessee does not terminate this Lease in accordance with the foregoing. broker or finder (other than the Brokers. Lessee and Lessor do each hereby agree to indemnify. to be exercised in writing within 10 business days after Lessor shall have given Lessee business days after the condemning authority shall have taken possession) written notice of such taking (or in the absence of such notice. defend and hold the other harmless from and against liability for compensation or charges which may be claimed by any such unnamed broker. bessor &Flail ~ay Brokers a fee ill itA IRe sGI:ieel"'le altasFieelte S!. bessee askAB leei!Je& !Flat aA} fail"'re eA its ~art le Jlra iEie SldSA aA EslefJjlBI GeFI!f<&ale-will-el4jl&6e-bes6e~~~~all) Galdse besser le IRSI:lr Gests Ret GeRtemJjlatea 13) IRiS bease. Lessee shall document the cost of said cure and supply said documentation to Lessor. or any part thereof. l it Lessor desires to finance. whether such award shall be made as compensation for diminution in value of the leasehold. Lessor shall repair any damage to the Premises caused by such Condemnation . 14 .witR-fesi*!G~Idre-l~~~e-ooF-f)feVeAI--tRe &KefGi&e-Gkiii)Yl~~&-afiG--remedie&-{}FaflteEl RBf91dAEI9F. including without limitation e1Ref. without regard to whether or not this Lease is terminated pursuant to the provisions of this Paragraph. and that no one. or more than 25% of that portion of the Premises not occupied by any building.-l:e6&ee-6haiiJla) ritteR Aslise Is besser a11a bessee ef &!. If the Premises or any portion thereof are taken under the power of eminent domain or sold under the threat of the exercise of said power (collectively "Condemnation"). FReAls e eel Jl"'rs"'aRI te 19.i:eGSGF&-ifiiSfe&HfHAis bease sl1all13e EleemeEI te Fla e ass\Jmei:J besser's 15 . lA ac!Giliefl. whichever f1rst occurs If more than 10% of the Building.

2 Date of Notice. covenant or condition hereof by the other party beGsee-. No Prior or Other Agreements. "FI a!ieAI PAGE 15 OF 23 INITIALS ©2001. 23. its 9 AiR esli(lalisA as Is IRe Rat<Jre.1 Notice Requirements. . Time is of the essence with respect to the performance of all obligations to be performed or observed by the Parties under this Lease 22. any act shall not be deemed to render unnecessary the obtaining of Lessor's consent to. the prior Lessor shall be relieved of all liability with respect to the obligations and/or covenants under this Lease !hereafter to be performed by the Lessor. or of any subsequent Default or Breach ~ of the same or of any other term. transmission or similar means shall be deemed delivered upon lelef!l\eAe confirmation of receipt (confirmation report from fax machine is sufficient).essee aRd tl:le lesser. The obligations of Lessor under this Lease shall not constitute personal obligations of Lessor or its partners. Brel1er Qlsslaim&r. as fells (i) el'll) " lesser's agaR! le1 all~ iR ~eaiiRgs er lesser's s~llageRI Ras lila "seAt. (II) lessee's "ee11t. t. and shall not seek recourse against Lessor's partners.satleR fer seP ise& reREiered . BrakeR. members. 18. return receipt requested._. In the event of a transfer of Lessor's title or interest in the Premises or this Lease. shall be deemed a waiver of any other term. (a) No waiver by either party be5sef of the Default or Breach of any term. provided a copy is also delivered via delivery or mail. 19.Jally-affeGtiRg-the-val~fBbilily of IRe ~Fej3art~ IRa! are Ael kAa' R Is. Either Party may by written notice to the other specify a different address for notice. ~6 Qisslesures RegaraiAiJ-=RI~~~ip.. " a~SGiese-al~BGt&-li-Re~l:J~Ier. which such statements and/or conditions shall be of no force or effect whatsoever unless specifically agreed to in writing by Lessor at or before the time of deposit of such payment. All notices required or permitted by this Lease or applicable law shall be in writing and may be delivered in person (by hand or by courier) or may be sent by regular. any subsequent or similar act by Lessee. er i~~~~~9Sffi-is RBI eeli§aleEI te re eal le eilller Part~ aRy-Geflftdefllial-irnermal~aifled-freFA 11'\e sli'!er PaFt~ElHffii&IYe-IJ:Ie allirFAa'l e d<Jiie& set fertll abe e. lesser aRE! lessee s: lesser's ageRt llRaer a lis~A!J agreemeRl fell~lfmal~igaUeRS ' Te !Fie bessel" •itt:l the lesser aels as !Fie ageRt fe· IRe lesser " ~dusia~ ill:! 111e ' esser. the postmark thereon. ef tl=le eiRer Part~ 19 11'\is lease aAEI as le ~~~y aREI sl'laraGler slll1e Pref!lises . as aforesaid. Any notice sent by registered or certified mail. lesser aAEI lessee ea&R rej3reseRis aRG arraAisls 11'\e 8rsl1ers 11'\at it Ras FAaae. Lessor shall deliver to the transferee or assignee (in cash or by credit) any unused Security Deposit held by Lessor. Severability. A copy of all notices to Lessor shall be concurrently transmitted to such party or parties at such addresses as Lessor may from time to time hereafter designate in writing. . if this is a sublease. elll'er iR fwll ar IR flart lrem tl'le besse . and Lessee shall look to the Premises. er B) fassiFAile t aASFAissieA. for the satisfaction of any liability of Lessor with respect to this Lease. with postage prepaid. the obligations and/or covenants in this Lease to be performed by the Lessor shall be binding only upon the Lessor as hereinabove defined.This Lease contains all agreements between the Parties with respect to any matter mentioned herein. The addresses noted adjacent to a Party's signature on this Lease shall be that Party's address for delivery or mailing of notices. or approval of. 24.S. and shall be deemed sufficiently given if served in a manner specified in this Paragraph 23.. officers or shareholders. certified or registered mail or U. The invalidity of any provision of this Lease. a. 21. The term "Lessor" as used herein shall mean the owner or owners at the time in question of the fee title to the Premises. Notices delivered by United States Express Mail or overnight courier that guarantees next day delivery shall be deemed given 24 hours after delivery of the same to the email a COmputer Or Notices transmitted by faWmile Postal Service or courier. covenant or condition hereof. sl=larasler aRe liAaRsial resj3eAsi9iliP. as determined by a court of competent jurisdiction. or any of their personal assets for such satisfaction. The acceptance of Rent by Lessor shall not be a waiver of any Default or Breach by Lessee. QilijeAt e11ereise er reasaRal!le skills aREI sara 11'1 ~eFfof'I'RaRse ef IRe ageRI's EM~!Jly--o41ooeGt-aFKJ. Definition of Lessor.e ageAt 16 Ret tile lesser's ageA~~R~eAt F!la)' resel e semfleR. 20. 23. Any payment by Lessee (b) may be accepted by Lessor on account of moneys or damages due Lessor.. Unless otherwise specifically indicated to the contrary. shall be deemed given on the date of Notices sent by overnight courier or messenger shall be effective upon the date indicated for the delivery at the appropriate address. l:la ·a RO resjleRsllllllly ·ItA respesl ll1erels er itFI res13esl te a A~ aefa<Jit 9F ere asA Fiereef 9~ eitFier Pari). Lessor shall only be required to provide notice via email. With respect to Lessor's right to enter the Premises. 17. notwithstanding any qualifying statements or conditions made by Lessee in connection therewith. aAG is rel~iR~Iel> ~139R.AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 16 . 23 Notices. If sent by regular delivery shown on the receipt card. 'A B!)BRI eaR agree teas\ as ageRI fer tile lessee sRI) . or be construed as the basis of an estoppel to enforce the provision or provisions of this Lease requiring such consent. '"'FieR aRteFiR!J iAta a Elisst~SGiefl-w~te-agookegaro~~~~ (a) ffaFA the Sl'lset IJRae~staAEI Rall)pa ar ageAS} relalleR&Rip er rejlresE!fllatieR it Ras • ill1 tFie ageRI askAG "les(le baiR!J a a qsaEI by tile Brokers IR !AI& t~aR&a61iOF1. Subject to the foregoing. it shall be deemed received on the next business day. mail the notice shall be deemed given 72 hours after the same is addressed as required herein and mailed with postage prepaid. Te !l:le l . and no other prior or contemporaneous agreement or understanding shall be effective. exse13t tl=lat <JI3eA lessee'& lakiR!J j3S&sessieA 91 IRe PreFAises. Upon such transfer or assignment and delivery of the Security Deposit. shall in no way affect the validity of any other provision hereof. officers or shareholders. of the Lessee's interest in the prior lease. covenant or condition hereof.financial statements. If notice is received on a Saturday. or. directors. s. Limitation on Liability. or approval of. Waivers. Sunday or legal holiday. directors. Days. " er ageRls iR tl'le IR!RsaslleR. tFie PreFAises sFiall seAslilllle lessee's aEiaress fer Aelise. Postal Service Express Mail.. members. and to no other assets of Lessor. overnight courier or messenger. Lessor's consent to. Time of Essence. the word "days" as used in this Lease shall mean and refer to calendar days. ~<Ialit~. lA tl'lesa &lt~alieRs . THE PARTIES AGREE THAT THE TERMS OF THIS LEASE SHALL GOVERN WITH REGARD TO ALL MATTERS (c) RELATED THERETO AND HEREBY WAIVE THE PROVISIONS OF ANY PRESENT OR FUTURE STATUTE TO THE EXTENT THAT SUCH STATUTE IS INCONSISTENT WITH THIS LEASE.faif-Eieal~eea faiiA. or if no delivery date is shown.

El!. With respect to Security Devices entered into by Lessor after the execution of this Lease. Covenants and Conditions. eut eAI) itA IRe I FIB laaga aR9 seRsaAI ef lletl:1 IRe besser aREl IRe lessee. iRiegFII). 30.-if-<~1& semFASF61ally-fea&oAa91e effeFts te obtain a Non-Disturbance Agreement from the holder of any pre-existing Security Device which is secured by the Premises. and to all renewals.lagal-e~~pet~ --------«(llH-)---OBSf.IQA aAe er mere (iii) llish dee& Ret lA •el assesiate liseAses. whereupon this Lease and such Options shall be deemed prior to such Security Device. (b) be subject to any offsets or defenses which Lessee might have against any prior lessor. 27.ll I'RisseREI~et ef s!lGR Braker. Ta tl=le lessee: " Asusia"J El!!l) ef !. " aut~ te Elisslese a~fl-kH~~iall 1 arfeeliRg the itRi~ligef!l-ilttenti9A-aFI8 seA'iEieRIIal iA'&ri'RalieA ellla iAeEI lrai'R the ether PaFI~ eeseP alieR ef. tl:ie ageAt ma) RBI itl~eultl1e BMflFess JlermissleA ef tile re&Jleeli e Party.4i&Giese-«HA&etl1ef-Pa~Re-be&6Gf-Will-aGGaj)l-r&fiHA-a FHimG!lflt. In the event that Lessor transfers title to the Premises. The agreements contained in this Paragraph 30 shall be effective without the execution of any further documents.-lj:. Such fees may be awarded in the same suit or recovered in a separate suit. enter into a new lease. 28. 30. and (ii) Lessor shall thereafter be relieved of any further obligations hereunder and such new owner shall assume all of Lessor's obligations. 30.1:!at iAElieatea iA IRa listiA!l er !Rat tl:ie bessee is AiglleHe~Hllfered A al!le er Eleslrallllil~ el the il~ Hie aos• e El!l~es sf IRe agenHR-a-feal estate lraAsastisA !le RBI relie><e a lesser er lessee tram the respeAsillii!W4e j*eleGI-IReiHlWA-iAtarasts. Non-Disturbance. Further. containing all of the terms and provisions of this Lease. the singular shall include the plural and vice versa. and upon request.3 Non-Disturbance. financing or refinancing of the Premises. "Security Device") . 111e Parties. Lessee and Lessor shall execute such further writings as may be reasonably required to separately document any subordination.1 Subordination. No remedy or election hereunder shall be deemed exclusive but shall. modifications. " real eslale age AI . Construction of Agreement. then Lessee may. Attornment. and extensions thereof Lessee agrees that the holders of any such Security Devices (in this Lease together referred to as "Lender") shall have no liability or obligation to perform any of the obligations of Lessor under this Lease. their personal representatives. Te tl1e bessee aAS tRe besser: a. e. b-. If any Party~ brings an action or proceeding involving the Premises whether founded in tort. wherever possible. (c) be bound by prepayment of more than one month's rent.2 Attornment. attornment and/or Non-Disturbance Agreement provided for herein.AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN·14-4/12E Exhibit 1 Page 17 .wiiR Ia• S!. eitl1er astiA!l sire Gil) er tl<lra\.jlllf6\Jaf!!-IG-tl'lis-bease. Lessee's subordination of this Lease shall be subject lo receiving a commercially reasonable non-disturbance agreement (a "Non-Disturbance Agreement") from the Lender which Non-Disturbance Agreement provides that Lessee's possession of the Premises .G~I:ler Elu~es to tl:le lesser aAs IRe bessee as sr (1~11 lesser aREI bessee. dut 1 ef utmest sara. --------k. or appeal thereon. 1:1a liaeilit) &Rail Ret lle BJlJ3Iisallle te a A) grass Ae§ligeRse er e er. In the event that Lessee holds over. Subordination. attorn to such new owner. upon written request from Lessor or a Lender in connection with a sale. as if both Parties had prepared it. Whenever required by the context . contract or equity. or (d) be liable for the return of any security deposit paid to any prior lessor which was not paid or credited to such new owner. Qili§eRI Bli&FGise el reaseAallle skills aRe sara iA J3erfer!'RaAse ef IRe a§ aRt's 810ties. "a eAt ReereseAiiFie Betti besser aAEI be sse e. except that such new owner shall not: (a) be liable for any act or omission of any prior lessor or with respect to events occurring prior to acquisition of ownership. Lessor shall. with in 9Q days after the execution of this Lease. el aAy Braker ' "ill:! res~Jeet te aR) s~el:l Ia su11 aAil 1er IeiJa I ~g-&Aa~H!~l~Geed-!R~GR-8fakef. the Prevailing Party (as hereafter defined) in any such proceeding. 30. This Lease and any Option granted hereby shall be subject and subordinate to any ground lease. er s. Any Lender may elect to have this Lease and/or any Option granted hereby superior to the lien of its Security Device by giving written notice thereof to Lessee. however.iEilAg se~rt sesls aRe auerAe)s' fees) .4 Self-Executing. or the Prem ises are acquired by another upon the foreclosure or termination of a Security Devise to which this Lease is subordinated (i) Lessee shall. bul rather according to its fair meaning as 29. saA legal!) 9e IRe agaR! ef botMR8-ba6&ef-amJ tRe bessee iA a traAsaslieA. mortgage.iil sr etl:!er legatpreseeiiii=IO re&J3est le aA) defa~lt e llreaeR Rereef B) either PaFI) . Binding Effect. or. TRe P afi~Aat-oo IA"~IssleR relaijAgte tl'lls bease ma) ee llre!l!'JRI agatAGI Braker I'Rsre IRa~ ) ear alter tile Stafl Qate aAa !Rat 111e liaaillt 1 (IAGI!.i!y er ReAes( aAa lair EleaiiAg aREI gees faUh . !Rat IRe-f&regoil'lfl-l!mitatieR eR aasR Braker's 1111\. with such new owner for the remainder of the term hereof. at Lessee's option. "R a§eflt4&-A6t-Gil~gated4G-«Wea~tl1er Part) aRy e tile affirmati e sulies set lertl1 abe e. This Lease shall be binding upon the Parties .r&lek~eF&-AaliEHIG-f6GpBAGilllUty.r-aafl<Ae~leets.less. or other hypothecation or security device (collectively. 30. or to declare rights hereunder. No Right To Holdover. Base Rent applicable immediately Nothing contained herein shall be Cumulative Remedies.3. notwithstanding the relative dates of the documentation or recordation thereof. 26. Choice of Law.iii'RBSI &are.-f)fBVieeEI. successors and assigns and be governed by the laws of the State in which the Premises are located.lalifiaEI te a9~1-l&al-&stat&. be cumulative with all other remedies at law or in equity. shall be entitled to reasonable attorneys' fees. IRa S!lal a!JeHGY-Sit!la lie~g~l!e-lellewi~ati e eellgatieRs te lletl=i tl:1e besser aREI tl1e bessee: a. This Lease shall not be construed as if prepared by one of the Parties. deed of trust. all headings and titles are for the convenience of the Parties only and shall not be considered a part of this Lease. Any litigation between the Parties hereto concerning this Lease shall be initiated in the county in which the Premises are located.. will not be disturbed so long as Lessee is not in Breach hereof and attorns to the record owner of the Premises. heRes~>}.sse<ee&-aagetr:eee-letG-14eAti~J Ia Brekers as "GeAAileAtial" aA) sei'RI'RIH\ii. ~Rat-are-Ret kAe R le. subject to the non-disturbance provisions of Paragraph 30.asliA!I eAI~ •ar a ~ssee tlas ttl a fells• iAg affiffl'laliYe--ebligalieAs. Attorneys' Fees. All provisions of this Lease to be observed or performed by Lessee are both covenants and conditions. that. a whole.a~ eR BrokeFS that is 68R6i9eraa ll) 6!l6R Part) Ia B8 69FifiaaAtial. at the election of the new owner. bessar aREI bessae sl:ioohJ-~ref!llly-r~li-agfeemeAis4!H!ss~Rat-IA~lEI*96~EleffilaREiiRQ ef IRe traAsastieA. this Lease will automatically become a new lease between Lessee and such new owner. then the Base Renl shall be increased to 4-5Q preceding the expiration or termination for the first three construed as consent by Lessor to any holding over by Lessee. now or hereafter placed upon the Premises. heRa&') aAEI le~ aUy-11\-lRB-<laaliAgs ' 111:1 either lesser slated aee e iA &!IOJlaraora!'l=is Ell or ttle A AEI!lsiaPj lessee .}-----lloee~ss~alf.4hafl-1. 12 5% of the (3) monthS and 150% thereafter. In construing this Lease. Lessee has no right to retain possession of the Premises or any part thereof beyond the expiration or term ination of this Lease. directly contact Lender and attempt lo negotiate for the Non-Disturbance Agreement within said executlon and delivery of a Non-Disturbance Agreement. 31 . and this Lease. ' real estate a~eRl is a ~ersaA!l\. aAEI Ia) aii) IR eealiAQS 1111 tl1e bessee . including any options to extend 30 the term hereof. •Aiegril~. action. whether or not such action or proceeding is pursued to PAGE 16 OF 23 INITIALS ©2001. provided... to any and all advances made on the security thereof. In the event that Lessor is unable to provide the 30 9Q days.

eraiAaf)' "fer 6~~\Jfl&. services. or (d) written confirmation that the guaranty is sUII in effect.' Lessee shall not place any sign upon the Premises without Lessor's prior written consent. provided.4 Effect of Default on Options. or the abandonment by the other Party~ of its claim or defense. conditioned or delayed. including the authority of the party signing on Guarantor's behalf to obligate Guarantor. 1G. assignment or subletting shall not constitute an acknowledgment that no Default or Breach by Lessee of this Lease exists. Except as otherwise provided herein. the determining party shall furnish its reasons in writing and in reasonable detail within 10 business days following such request. lenders.lafa\.-witR bessee seFII¥Rg-ll:lal lessee has RaiRter=~Yan a~&feafteH&&igAI~~~39. Lessor's Access. Lessor shall not be obligated to exercise any standard of reasonableness in determining whether to permit an auction. Except as otherwise expressly provided in this Lease. shall each execute a guaranty in the form most recently published by the AIR Commercial Real Estate Association. Quiet Possession. or response to. (b) The period of time within which an Option may be exercised shall not be extended or enlarged by reason of Lessee's inability to exercise an Option because of the provisions of Paragraph 39. except as may be otherwise specifically stated in writing by Lessor at the time of such consent. or tenants. the right of first offer to purchase or the right of first refusal to purchase the Premises or other property of Lessor. a subletting or the presence or use of a Hazardous Substance. Lessor's failure within 10 days following any such event to elect to the contrary by written notice to the holder of any such lesser interest. (c) an Estoppel Certificate. 33. Lessor may place on the Premises ordinary "For Sale" signs at any time and ordinary "For Lease" signs during IRe last e FRBRIAs ef the term hereof. third party costs and expenses (including but not limited to architects'. The attorneys' fees award shall not be computed in accordance with any court fee schedule. Showing to perspective tenants shall be limited to the final six (6) months of the Term. using and maintaining of utilities. 35. Options. Guarantor.3 Multiple Options. "Option" shall mean: (a) the right to extend or reduce the term of or renew this Lease or to extend or reduce the term of or renew any lease that Lessee has on other property of Lessor. aA9 eAI) Rile IRe eri(liRal lessee is iR fllll (3BssessieA ef IRe PreFRises aA8. whether by compromise. (b) the right of first refusal or first offer to lease either the Premises or other property of Lessor. 39. engineers' and other consultants' fees) incurred in the consideration of. In the event that either Party disagrees with any determination made by the other hereunder and reasonably requests the reasons for such determination. after such exercise and prior to the commencement of the extended term or completion of the purchase. Lessor and Lessor's agents shall have the right to enter the Premises at any time. (iii) during the time Lessee is in Breach of this Lease. that Lessor may elect to continue any one or all existing subtenancies. improvements or additions to the Premises as Lessor may deem necessary or desirable and the erecting. Merger. Signs. if. including but not limited to consents to an assignment. shall be paid by Lessee upon receipt of an Invoice and supporting documentation therefor. a certified copy of a resolution of its board of directors authorizing the making of such guaranty. Subject to payment by Lessee of the Rent and performance of all of the covenants. however.. shall constitute Lessor's election to have such event constitute the termination of such interest 36. a request by Lessee for any Lessor consent. "Prevailing Party" shall include. In the event that Lessee has any multiple Options to extend or renew this Lease. (c) the right to purchase. The Guarantors. l=lel/"er OF AGI a legal aGiiEIA Is 5llll58Ejli9AIIy-G&RUIIBR66B if! 613Af!e~ieR ilit 61061=1 l. any auction upon the Premises without Lessor's prior written consent. lesser sl'lalllle eRtille~ ta attame~s· ~~~Rses IRsurrea iR ll'le prepa~Re seP ise ef Retises-ef 9elal!ll 8AB G9A61JitatleA& iR GGRAeGiiGA tt:lere IIA. All signs must comply with all Applicable Requirements. 38. 39. and cannot be assigned or exercised by anyone other than said original Lessee. Lessor's actual reasonable. The failure to specify herein any particular condition to Lessor's consent shall not preclude the imposition by Lessor at the time of consent of such further or other conditions as are then reasonable with reference to the particular matter for which consent is being given. Any Option granted to Lessee In this Lease is personal to the original Lessee. I!Hitl4iMR. (b) current financial statements (as applicable). Termination. or a termination hereof by Lessor for Breach by Lessee. attorneys'. settlement. be&GGr. Unless specifically stated otherwise in writing by Lessor. 37. and in the case of a corporate Guarantor. conditions and provisions on Lessee's part to be observed and performed under this Lease. such consent shall not be unreasonably withheld. as the case may be. 34. Except for any signs existing as of the Commencement Date. Lessee shall not conduct.decision or judgment. judgment. Mllltiple BuiiEllngs. Auctions. 39. as defined below. It shall constitute a Default of the Lessee if any Guarantor fails or refuses. and each such Guarantor shall have the same obligations as Lessee under this Lease.. without limitation. shall automatically terminate any sublease or lesser estate in the Premises. a Party ~ who substantially obtains or defeats the relief sought. A all such activities shall be without abatement of rent or liability to Lessee. if reqllestese. the mutual termination or cancellation hereof. in the case of an emergency. If IRe PreFRises are a (3aFI ef a !JFBll(3 ef ll~s seAtrellee ll) lesser.2 Options Personal To Original Lessee. nor permit to be conducted. the voluntary or other surrender of this Lease by Lessee. whether or not the Defaults are cured. (i) Lessee fails to pay Rent for a period of 30 days after such Rent becomes due (without any necessity of Lessor to give notice thereof). Repairs. notwithstanding Lessee's due and timely exercise of the Option. The term. then the following provisions shall apply: 39 1 Definition. 37. Consents. lessee a§rees tl'lat it ill allise ll) aREl senferFR te PAGE 17 OF 23 INITIALS ©2001 -AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 18 . upoo Within 20 days after a request to provide: (a) evidence of the execution of the guaranty. Showing Premises. during the 12 month period immediately preceding the exercise of the Option.1 Execution. or (ii) if Lessee commits a Breach of this Lease. a later Option cannot be exercised unless the prior Options have been validly exercised. nor shall such consent be deemed a waiver of any then existing Default or Breach. and otherwise at reasonable times after reasonable prior notice for the purpose of showing the same to prospective purchasers. 37 2 Default. if any. 32.lll ElF Fes~lliA!!I 8rea6l'l (S:!QQ is a reasanable mlnim~Jm per essl!rrense lar &liSA seP ises aRe seA&lllloallaA) . (a) Lessee shall have no right to exercise an Option: (i) during the period commencing with the giving of any notice of Default and continuing until said Default is cured. or (iv) in the event that Lessee has been given 3 or more notices of separate Default. wherever in this Lease the consent of a Party Is required to an act by or for the other Party. pipes and conduits through the Premises and/or other premises as long as there is no material adverse effect to Lessee's use of the Premises.4(a) (c) An Option shall terminate and be of no further force or effect. Lessee shall have quiet possession and quiet enjoyment of the Premises during the term hereof. Lessor's consent to any act. (ii) during the period of time any Rent is unpaid (without regard to whether notice thereof is given Lessee). repairs. If Lessee is granted an Option. but shall be such as to fully reimburse all attorneys' fees reasonably incurred. and making such alterations.

Lessor makes no warranty or representation as to whether or not the Premises comply with ADA or any similar legislation . circumstances. dated August 29. except as otherwise expressly provided in this Lease: (a) Lessee is leasing the Premises in an "AS-IS" condition as of the date of the Commencement Date with respect to any facts. each of wh ich shall be deemed an original and all of which together shall constitute one and the same instrument. its agents and invitees and their property from the acts of third parties. Conflict. 41. 2012 (as amended. to and with the Lessor. Lessee hereby acknowledges that the Rent payable to Lessor hereunder does not include the cost of guard service or other security measures. agreed to purchase the fee interest in the Premises. 51 . sJ:oippe rs. circumstances. 46.a6e-B. An Addendum requiring the Arbitration of all disputes between the Parties and/or Brokers arising out of this Lease Is 0 50. THE PARTIES HEREBY Wf. 47. Performance Under Protest. and Lessee is and will be fully satisfied that the Rent is fair and adequate consideration for the use of the Premises. Americans with Disabilities Act Since compliance with the Americans with Disabilities Act (ADA) is dependent upon Lessee 's specific use of the Premises . Reservations. Waiver and Relea6e.JR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN·14-4/12E Exhibit 1 Page 19 . (b) Lessor has no obligation to repair or correct any such facts. 48. If at any time a dispute shall arise as to any amount or sum of money to be paid by one Party to the other under the provisions hereof. 0 Arbitration of Disputes. Any conflict between the printed provisions of this Lease and typewritten or handwritten provisions shall be controlled by the 45.e maRageFR eAl safet 1. Sale Le. from Ume to time. rights. California. The recordation in the official records of Orange County. Authority. Pursuant to the terms of that certain Agreement of Purchase and Sale and Joint Escrow Instructions. Lessee does hereby acknowledge. IRGI~oJd~ sara a Rei sleaAiiReGG ef IRe graYAeiG aAd i AGIOOing-thepa flli Ag . typewritten or handwritten provisions. such easements. anel sare elsaiEiprapeFUe&. (c) This Lease may be executed by the Parties in counterparts. Security Measures. and (e) by reason of all of PAGE 18 OF 23 INITIALS ©2001 • f. Amendments. This Lease is not intended to be binding until executed and delivered by all Parties hereto. represent. 6111Jilllers. conditions and defects. partnership . GIISIBFRB£6. (c) by the Commencement Date. warrant and agree.ack. conditions or defects or compensate Lessee for same. each such person or entity shall be jointly and It is agreed that any one of the named Lessees shall be empowered to execute any amendment to this Lease . Lessee is and will be relying upon such inspections and examinations and the advice and counsel of its agents and officers. the Commencement Date shall be deemed to have occurred on the Closing Date. Lessor reserves to itself the right. each individual executing this Lease on behalf of such entity represents and warrants that he or she is duly authorized to execute and deliver this Lease on its behalf. without the consent or joinder of Lessee. The date upon which such event occurred is referred to herein as the "Closing Date". limited liability company . to grant. and that Lessor shall have no obligation whatsoever to provide same. rights and dedications that Lessor deems necessary. and Lessor. 53. 52.JVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR ARISING OUT OF THIS AGREEMENT. and that based upon same. aRG Ia sati6B its BFRJJia~ 886. Lessee assumes all responsibility for the protection of the Premises.all reasaAall le ru~latieRG J:lisl:l besse r 1na~ mal.e lfem Ume ta time fer lt. is not attached to this Lease. maps and restrictions do not unreasonably interfere with the use of the Premises by Lessee. trust. Intentionally Omitted. and Lessor may rely on the same as if all of the named Lessees had executed such document. 49. This Lease may be modified only in writing . (a) If either Party hereto is a corporation. and to cause the recordation of parcel maps and restrictions. Lessee shall have undertaken all such physical inspections and examinations of the Premises as Lessee deems necessary or appropriate under the circumstances. said Party shall be entitled to recover such sum or so much thereof as it was not legally required to pay. Lessee agrees to make any such necessary modifications and/or additions at Lessee's expense. 42. (b) severally liable hereunder If this Lease is executed by more than one person or entity as "Lessee". as "Seller" agreed to sell. Lessee. or other document ancillary thereto and bind all of the named Lessees. the "Purchase Agreement"). Each Party shall . signed by the Parties in interest at the time of the modification As long as they do not materially change Lessee's obligations hereunder. Multiple Parties. 43. If it shall be adjudged that there was no legal obligation on the part of said Party to pay such sum or any part thereof. dedications. Execution. Lessor is not making and has not made any warranty or representation with respect to all or any part of the Premises as an inducement to Lessee to enter into this Lease and to occupy the Premises or for any other purpose. 44 . within 30 days after request. G8AIF86i8F6 aRel lA ~lee& le 68 ab lele aRei 68Afa rm 1 B~fees-tO·f)ily4~ f8 ef G9FRFR8A Blffl9A696 IAG IIFFBel iA GBAA8GiieR ' •ltJ:I ~ieG-afiG-re§lllaliGA!r. of a grant deed conveying the Building to Lessor evidences the consummation of the transaction contemplated by the Purchase Agreement. the Party against whom the obligation to pay the money is asserted shall have the right to make payment "under protest" and such payment shall not be regarded as a voluntary payment and there shall survive the right on the part of said Party to institute suit for recovery of such sum . Offer. la a<liA!l aRS Ul'llaa EiiAg af el:lisles. As a material inducement to the execution and delivery of this Lease by Lessor and the performance by Lessor of its duties and obligations hereunder. Preparation of this Lease by either Party or their agent and submission of same to the other Party shall not be deemed an offer to lease to the other Party. map or restrictions . In the event that Lessee's use of the Premises requires modifications or additions to the Premises in order to be in ADA compliance. Lessee. or similar entity. Lessee agrees to sign any documents reasonably requested by Lessor to effectuate any such easement rights. Lessee agrees to make such reasonable non-monetary modifications to th is Lease as may be reasonably required by a Lender in connection with the obtaining of normal financing or refinancing of the Premises. Waiver of Jury Trial . so long as such easements. that. dedication. (d) except as expressly set forth above in this Lease. as "Buyer". deliver to the other Party satisfactory evidence of such authority. A Party who does not initiate suit for the recovery of sums paid "under protest" with 6 months shall be deemed to have waived its right to protest such payment.

.. . AT THE TIME THIS LEASE IS EXECUTED. and Lessor's agents. Executed Exe~. the condition of the Premises. representations and warranties... WEST2RN STATE U~IVERSITY OF SOUTHERN ~a-=Ca~l~~~·f~o~r~n~i~a~n~o~n~-p~r~o~f~i~t~ p~ u~ b~ l~i~ c ~b ~e~n~e~f~i~t_ _ __ CALIFORNIA. AND BY THE EXECUTION OF THIS LEASE SHOW THEIR INFORMED AND VOLUNTARY CONSENT THERETO. Lessee acknowledges and agrees that the foregoing waiver and release includes all rights and claims of Lessee against Lessor pertaining to the condition of the Premises.__ _ __ On :-~ ~~______Do) .:!.:. which provides as follows: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE. of whatever kind or nature. THE PARTIES ARE URGED TO: 1. employees and contractors. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES.! Jfoff.....·:··~. Lessor..-..:::5:. without limitation.-:. LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND PROVISION CONTAINED HEREIN. whether heretofore or now existing or hereafter arising. WARNING: IF THE PREMISES IS LOCATED IN A STATE OTHER THAN CALIFORNIA. or may be claimed to exist. THE CONDITION OF THE ROOF AND OPERATING SYSTEMS. THE PARTIES HEREBY AGREE THAT. RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF THE PREMISES. Except as otherwise expressly provided in this Lease. CERTAIN PROVISIONS OF THE LEASE MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF THE STATE IN WHICH THE PREMISES IS LOCATED. LEGAL EFFECT.: O:. Addl'tlonal En-try Provlelone. 55. r?. costs and/or expenses (including attorney's fees). SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE. might. 2..fLtLJ. The parties hereto have executed this Lease at the place and on the dates specified above theyrspectlve signatures. or relate to.. Feee and No'tlcee. as amended from time to time. all requests and notices provided pursuant to this Lease shall be made in writing. With respect to any entry into the Premises by Lessor (other than in the event of an emergency).the foregoing.1. and Lessor's agents. its covenants.!:.:t. AND THE SUITABILITY OF THE PREMISES FOR LESSEE'S INTENDED USE. 0/B/A WESTERN STATE UNIVERSITY PAGE 19 OF 23 INITIALS ©2001 ·AIR COMMERCIAL REAL ESTATE ASSOCIATION INITIALS FORM STN-14-4/12E Exhibit 1 Page 20 .. which in any way arise out of..!.. Whenever any reference is made in this Leass to fees. circumstance.. LESSEE'S INITIALS The foregoing release shall not excuse Lessor's breach of its express obligations under this Lease._l. on. and Lessee hereby expressly and unconditionally waives and releases Lessor from any and all rights and claims against Lessor with respect to the condition of the Premises.'. or are connected with. condition or defect pertaining to the physical and financial condition of the Premises. including. under or about the Premises...~~d at: al: . or similar laws. In connection with the foregoing release... . THE ZONING OF THE PREMISES.!__--. Lessee shall assume the full risk of any loss or damage occasioned by any fact. employees and contractors shall not unreasonably interfere with Lessee's use of the Premises and Lessee shall have the right to cause one if its employees to accompany Lessor while Lessor enters the Premises. THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE PREMISES ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AIR COMMERCIAL REAL ESTATE ASSOCIATION OR BY ANY BROKER AS TO THE LEGAL SUFFICIENCY. whether known or unknown... OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT RELATES.Lt..h4 v=--•.....:. liquidated or unliquidated. WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR._ :::: _ _ __ _ _ _ By LESSEE: CSU FULLERTON AUXILIARY SERVICES CORPORATION. suspected or unsuspected.. each as though fully set forth herein at length.A: t. Compensation ald Liability Act. __ • On : By LESSOR: ::!. -. 54._. Except as otherwise indicated in this Lease.=t.. THE STRUCTURAL INTEGRITY. or which could.. including without limitation the presence of any Hazardous Materials in. including without limitation any rights of Lessee under the State or Federal Comprehensive Environmental Response. h/f5 --oL!. Lessee specifically and expressly waives all of its rights under Section 1542 of the California Civil Code.L. such amounts shall be reasonable.

....-.COLL&GE OF LAW....-..... Suite 1 Laguna Beach.........-....... Email: ..-..~:::!==::7L~------.-----------------..-----------------....-.- NOTICE: These forms are often modified to meet changing requirements of law and industry needs....~~lU~~--"'=::::~~:d....-...-......-- . CA 92831-3137 Attention: Mr.... James G...............-.-..-- Telephone:(_) Facsimile :(___ ) Facsimi le :( __)--..-..... CA 92651 Attn: Mr... Suite 275 Fullerton..-...-..-.-.-.-- By: --------------------------------------.-- Address : Title: - ------------- ........ (213) 667-8777..........-..-..-.-........ Los Angeles ...-........- Email: .. CA 90017. ©Copyright 2001 ·By AJR Commercial Real Estate Association ...........-............-.....-......-.....- Email - ) ..-.-......- Federal ID No.....- BROKER: Alln - BROKER: ....-.-......-...- Facsimile:(_ Email : .. _ _ ____________ _ _ _ _________ Broker/Agent DRE License #: _____ ........-.-...-.... McWalters Telephone: (949) 715-4113 Fax: (949) 715-4112 With a copy to: Bouza....-.. Address for Notices: To Lessor CSU Fullerton Auxiliary Services Corporation 2600 Nutwood Avenue. Telephone: (213) 488-0675 ext.. 3 Fax: (213) 488-1316 To Lessee Western State University of Southern Californi a PAGE 20 OF 23 INITIALS ©2001 -AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 21 ..-..-..-..... California 90015 Attn: Anthony S............. . Coast Hwy. A Ca lifornla corporation By: _j[t~QJ~~~~~QQ~~~_.. 800 W 6th Street....By: Tille : .....-.... Telephone No..........-..-..-..........-..Address : Telephone:(_ _) ...- .-.~~:::_ By· Name Tille: _________________________________________ ___!:=:::!...... Always write or call to make sure you are utilizing the most current form : AIR Commercial Real Estate Association....... Bouza...-.....-..-..-...-...-.-.-....Tille: .-- ....-.-- .....-- Na me Printed: ............-.......-..........Name Printed: ..........-..-....- ..-.- Email : Federal ID No.Attn : .-.-....Address...........-...-.-..: (213) 667-6616...-..-..... All rights reserved.-.....Name Printed: .. Frank Mumford Telephone: (657) 278-4100 Fax: (657) 278-1410 With a copy to: McWalters Advisors 2094 S.-.-.....-...-- . Suite 800...-- Federal ID No ....-------------.-- .-..-- ------- Tille Address : Tille· .......................-.....-. Esq.............-. Klein & Kaminsky 950 South Flower Street......-.-.-.Federal ID No.. Fax No..-........- .Telephone:(_) Email : ......-.-.-.............-.... Telephone:(_ Facsimile:(___ ) .. Suite 100 Los Angeles.-....-- Broker/Agent DRE License #: ... No part of these works may be reproduced In any form without perm ission In writi ng.....................-.

-.-..-. 800 W 6th Street......---..-...Facsimile:(_ ) Facsimile:(_) .....-......-------------.........-- .-..-........-..-.. Bouza....... CA 92651 Attn: Mr......-.........- Federal ID No Federal ID No.~... Always write or call to make sure you are utilizing tho most current form : AIR Commercial Real Estate Association.........-...-...... No part of those works may be reproduced in any form without permission in writing.....-.......-..- Email: ......-.......... - Email: --------...-- Broker/Agent DRE License #: Broker/Agent DRE License #: ------------... Coast Hwy.-.-....-..-..- FederaiiD No....Telephone:(_) Email ... 3 Fax: (213) 488-1316 To Lessee Western State University of Southern California PAGE 20 OF 23 INITIALS ©2001 -AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 22 ..-.Address: Telephone:( ___ ) Facsimile:(_) .. Address for Notices: To Lessor CSU Fullerton Auxiliary Services Corporation 2600 Nutwood Avenue......-.-..-...-............... Telephone: (213) 488-0675 ext. All rights reserved .-....-......-..-.-..-...-. Fax No..-.-....... Telephone No...-- .-......- Email: Ema il . McWalters Telephone: (949) 715-4113 Fax: (949) 715-4112 With a copy to: Bouza.J--~2-:::.........-......-.. Esq.~-----":::g-l-f-~.-...-............-....---- ---I-1--.-...----......... Klein & Kaminsky 950 South Flower Street Suite 100 Los Angeles.-..-...-.. CA 90017..-........-......-..S....-....-....-....- Address : Tille: ......: (213) 687-8616...L3... Suite 275 Fullerton..-......-=-:---------FederaiiD No ........ Los Angelos ...-.. ©Copyright 2001 -By AIR Commercial Real Estate Association ..........t____ _ __ BROKER : Attn· .-....-- BROKER: ...... California 90015 Attn: Anthony S.....---.-...-- Address Telephone:( __ ) .......corporation coroorat.. Suite BOO.-...-....-..-..- Facsimile:(___) - Email : --------------... ....:on By: Name Printed: Title: By: Name Printed: Title: -----------------------------------By:--------------------------------..-....... Frank Mumford Telephone: (657) 278-4100 Fax: (657) 278-1410 With a copy to: McWalters Advisors 2094 S.-..- --------- NOTICE : Those forms are often modified to meet changing requirements of law and industry needs.·....-.....-......Telephone :( _ ) ......LI_.-.....Name Printed : ------..-.---------------... Suite 1 Laguna Beach.......-....-...-.. James G.-.. CA 92831-3137 Attention: Mr.-.-· .....---- ------.. (213) 687-8777.....-...-----------------..Attn: Title Title' Address : ..::---::--r-..

edu With a copy to: Education Management Corporation 210 Sixth Avenue Pittsburgh. Pennsylvania 15222 Attn: Vice President. 25th Floor Pittsburgh. Corporate Real Estate Email: adgarcia@edmc.Westwood-Booth@amJII. Pennsylvania 15259 Attn: Lease Administration. 525 William Penn Place. Pennsylvania 15222 Attn: Senior Real Estate Counsel Email: LMcCiintock@edmc.edu With a copy to: Education Management Corporation 210 Sixth Avenue Pittsburgh.edu With a copy to: Jones Lang LaSalle Americas. California 92831 Attn: Dean Email: weadams@wsulaw.com PAGE 21 OF 23 INITIALS ©2001 -AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 23 .d/b/a Western State University College of Law 1111 North State College Boulevard Fullerton.EDMC 6047-A-L001 Email: Bruce. Inc.

I2ESCRWilQt-4.EXI:UBII "A" LE. DESCRIBED AS FOLLOWS: PARCEL 11N THE CITY OF FULLERTON.__QE_fREM lS.GAL. AS PER PLAT RECORDED IN BOOK 10 OF PARCEL MAPS.ES. IN THE OFFICE OF THE COUNTY RECORDER OF ORANGE COUNTY. PAGE 22 OF 23 INITIALS ©2001 ·AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN-14-4/12E Exhibit 1 Page 24 . PAGE 50. COUNTY OF ORANGE. CALIFORNIA. STATE OF CALIFORNIA. CALIFORNIA.. ALL THAT LAND LOCATED IN ORANGE COUNTY.

EXI:!IBJJ_~~~·· 5CiiEJ2..EJ)£. September 30.409.423. September 30. through and including.UJ.583. 2014.326..079 $117.08 From October 1.038 $114.003.25 PAGE 23 OF 23 INITIALS ©2001 ·AIR COMMERCIAL REAL ESTATE ASSOCIATION FORM STN·14-4/12E Exhibit 1 Page 25 . through and including.17 From October 1.368. 2014 $1.997 $110.~E__KENI PERIOD ANNUAL BASE RENT MONTHLY BASE RENT From the Commencement Date through and including September 30. 2013 $1. 2013. 2015 $1.

EXHIBIT 2 Exhibit 2 Page 26 .

James H:Cc: Mumford. Right now it is just two years. Jim From: Marsico. Joe Joseph Marsico Director . James H. Joseph-Subject: RE: Western States College of Law Joe.Corporate Real Estate Education Management Corporation 210 Sixth Avenue. But who knows what can happen 10 months from now. 3rd Floor Pittsburgh.edu] ·Sent: Friday. [mailto:jhalexander@Exchange. 2014 2:39 PMTo: Marsico. Joseph [mailto:jmarsico@edmc.EDU] ·Sent: Wednesday. Frank5ubject: RE: Western States College of Law Thanks Jim. PA 15222 ph: (412) 995-7144 cell: (412) 592-6090 fax: (412) 471-2597 Exhibit 2 Page 27 . July 30. 2014 9:49 AMTo: Alexander. July 25.FULLERTON.From: Alexander. I will keep you posted. I have the approval of the one year and a Campus approval for 2 but we need the Chancellor's office to approve the two year.

FULLERTON. Joseph" <jmarsico@edmc. PA 15222 ph: (412) 995-7144 cell: (412) 592-6090 fax: (412) 471-2597 From: Alexander. 2014. JimllllllJames H. Alexander IliOn Jul 25. James H. James H. 2014 12:45 PM-To: Marsico. Please let me know if you are able. Thanks Joe Joseph Marsico Director .edu> wrote: Morning Jim.FULLERTON. Joseph-Cc: Mumford. [mailto:jhalexander@Exchange.From: Alexander. [mailto:jhalexander@Exchange.EDU] ·Sent: Friday. Just wanted to follow up on the two years. 3rd Floor Pittsburgh. "Marsico. at 9:39AM.EDU] ·Sent: Wednesday. July Exhibit 2 Page 28 .Corporate Real Estate Education Management Corporation 210 Sixth Avenue. Do you think you might ask for more time or is two years the maximum? I will be in the office on Monday. Frank-Subject: Re: Western States College of Law I asked you a couple of weeks ago what your intentions were after two years. July 25.

James H. hope to hear later today. June 24.FULLERTON. [mailto:jhalexander@Exchange. an AT&T 4G LTE smartphone D D-------. Thanks Joe Joseph Marsico Director . Joseph." DSubject: RE: Western States College ofLaw Good morning Jim. 2014 6:50 PMTo: Marsico. Frank Mumford-Subject: RE: Western States College of Law Not yet. 2014 11:48 AMTo: Marsico. PA 15222 ph: (412) 995-7144 cell: (412) 592-6090 fax: (412) 471-2597 From: Alexander. Joseph" DDate:07/02/2014 8:46AM (GMT-08:00) DTo: "Alexander. Just following up to see if any word from your boss on a 2 year extension. 3rd Floor Pittsburgh. Joseph-Subject: Western States College of Law Exhibit 2 Page 29 .DFrom: "Marsico. Jim Sent via the Samsung GALAXY S® 5.EDU] ·Sent: Tuesday.Corporate Real Estate Education Management Corporation 210 Sixth Avenue. James H.Original message -------.02.

you may not review. 2016 at a monthly rental rate of $123. I hope to have that decision before July 4th. please notify the sender immediately and delete the original message. If you have received this email in error. If you have received this email in error.92. If you are not the intended recipient.we have agreed to extend the rental agreement for one additional year through September 30. I thought I would wait for a decision from Campus before having an amendment drafted. Neither the sender nor the company for which he or she works accepts any liability for any damage caused by any virus transmitted by this Exhibit 2 Page 30 .As we discussed on the phone today .41 for an annual rate of $1.294. If you are not the intended recipient. copy or distribute this message. I intended to have the amendment done by the first of next week but after you asked for a second year extension. please notify the sender immediately and delete the original message.479.532. you may not review. copy or distribute this message. CONFIDENTIALITY NOTICE: This email and any files transmitted with it are confidential and intended solely for the use of the individual or entity to which they are addressed. Neither the sender nor the company for which he or she works accepts any liability for any damage caused by any virus transmitted by this email. Does this work for you? Jim CONFIDENTIALITY NOTICE: This email and any files transmitted with it are confidential and intended solely for the use of the individual or entity to which they are addressed.

If you are not the intended recipient. copy or distribute this message. CONFIDENTIALITY NOTICE: This email and any files transmitted with it are confidential and intended solely for the use of the individual or entity to which they are addressed. If you have received this email in error. you may not review.email. please notify the sender immediately and delete the original message. Neither the sender nor the company for which he or she works accepts any liability for any damage caused by any virus transmitted by this email. Exhibit 2 Page 31 .

EXHIBIT 3 Exhibit 3 Page 32 .

CA 90802 562. On the other hand. 2014 4:01 PM-To: White. Chancellor White. As I understand it the lease was extended once already to 2016. Timothy. White Chancellor The California State University 401 Golden Shore long Beach. Nice to hear from you and I trust all is well with you and yours. Thanks for the introduction to President Swenson of AU. Tim Timothy P. August 18. The best place to have such am conversation is at the campus level. and now the request is another year's extension into 2017. Exhibit 3 Page 33 . Mesa. President Swenson. the best contact person for this discussion is VP Danny Kim on the Fullerton campus. there are emerging space needs for CSU students and programs. With many thanks and best regards. I am reaching out to you on behalf of an institution in my WASC portfolio.org] ·Sent: Monday. By means of this email. I discussed this matter today with President Garcia.Hi Richard. TonyCc: Craig Swensorl'Subject: An important request Good afternoon. Both are copied.4700 From: Richard Winn [mailto:rwinn@wascsenior.951. I would like to introduce you to Dr Craig Swenson. these aren't decisions that are made in the system office.

Exhibit 3 Page 34 . We miss your valuable presence on the Commission! CONFIDENTIAL WASC COMMUNICATIONS: This email and any files transmitted with it are intended only for the person or entity to which it is addressed and may contain confidential and/or privileged material.org P. Any review. Richard Richard Winn Senior Vice President WASC Senior College & University Commission Direct: (510} 748-9792 rwinn@wascsenior. had entered into a sale and lease-back arrangement for one of their buildings to the Fullerton campus. which adjoins the CSU Fullerton campus. The agreed-upon timing for transition of occupancy is now being modified. dissemination or other use of or taking any action in reliance upon this information by persons or entities other than the intended recipient is strictly prohibited. please contact the sender at the WASC Senior College and University Commission immediately and delete the material.S. retransmission. Thank you for what you may be able to do. placing the School of Law in extreme jeopardy and risk of closure. might you be able to direct President Swenson to the right person within the Chancellor's Office with whom he could negotiate? We hold the School of Law on good esteem and would like to see its contribution protected. If you received this message in error.President of Argosy University. The School of Law for Argosy. While these transactions may not be on your immediate horizon.

EXHIBIT 4 Exhibit 4 Page 35 .

FULLERTON.FULLERTON." <dkim@Exchange. You do need to know that based on the representations made to us via email that the extension had been approved. we acted in good faith to discontinue our negotiations on another property which is now unavailable. Sincerely yours. Craig" <craig.swenson@edmc.Danny Danny C.EDU> Subject: Re: An important request Danny. Current lease expires in September 2015 and we were not able to extend it as initially thought due to circumstances that subsequently emerged.09011 Cell: 312.03581 Fax: 714.edu> Date: Wednesday.D.0949 From: <Kim>.edu> Cc: President Mildred Garda <millieg@Exchange. President Swenson. "Danny C. I will call as soon as I am able.swenson@edmc. looking forward to hearing from you. CA I 92868 Office: 714. 2014 at 10:55 AM To: Danny Kim <dkim@exchange.620. We have now passed the window to find a suitable facility for Western State College of Law for the next academic year and there would be significant damage to our business should you renege on the original agreement.fullerton. Obviously I think we would all prefer to resolve this issue informally and I will call as soon as I am free.fullerton. August 20. Craig" <craig. Craig Swenson Craig D. 2014 at 9:56 AM To: "Swenson.590. Craig <craig.620. "Swenson. Swenson. Danny _J 2 Exhibit 4 Page 36 .swenson@edmc. Ph. Please reach me at the number below.FULLERTON.EDU> Subject: FW: An important request . Fullerton T 657-278-2115 I F 657-278-1199 http:l!vpadmin. I Chancellor !Argosy University System 333 City Boulevard West I Suite 1810 I Orange.e·du> Cc: President Mildred Garcia <millieg@Exchange. Chancellor White's email indicated that the 2016 extension had been approved and our expectation based on his confirmation is that this extension will be honored.EDU> Date: Wednesday. Thank you for reaching out. Kim Vice President Administration and Finance/CFO California State University. August 20.edu From: <Swenson>.edu>.

Fullerton . White Chancellor The California State University 401 Golden Shore Long Beach. CA 90802 562. Tim Timothy P.edu>.edu>. I would like to introduce you to Dr Craig Swenson. Mesa. 2014 4:01PM To: White. By means of this email.FULLERTON. August 18.fullerton. "Mesa. these aren't decisions that are made in the system office.4700 From: Richard Winn [mailto:rwinn@wascsenior. Timothy. Tony Cc: Craig Swenson Subject: An important request Good afternoon. The best place to have such am conversation is at the campus level.Danny C. Kim Vice President Administration and Finance/CFO California State University.edu>. President of Argosy University.swenson@edmc. which adjoins the CSU Fullerton campus. and now the request is another year's extension into 2017. Timothy <twhite@calstate. 2014 at 6:03 PM To: Richard Winn <rwinn@wascsenior.edu> Date: Tuesday.EDU> Subject: RE: An important request Hi Richard. President Swenson..fullerton. President Mildred Garda <millieg@Exchange. had entered into a sale and lease-back arrangement for one of their 3 Exhibit 4 Page 37 . I am reaching out to you on behalf of an institution in my WASC portfolio.org] Sent: Monday.951.org> Cc: Craig Swenson <craig. On the other hand. As I understand it the lease was extended once already to 2016. August 19. the best contact person for this discussion is VP Danny Kim on the Fullerton campus. Nice to hear from you and I trust all is well with you and yours. 657-278-2115 1 r 657-278-1199 http://vpadmin. there are emerging space needs for CSU students and programs. Tony" <tmesa@calstate. I discussed this matter today with President Garcia. With many thanks and best regards. Chancellor White. Danny Kim <dkim@exchange. The School of Law for Argosy. Thanks for the introduction to President Swenson of AU. Both are copied.edu J From: <White>.

EXHIBIT 5 Exhibit 5 Page 38 .

Fullerton agreed to extend the leaseback by an additional year. I was therefore most concerned upon receipt of an email from your Vice President for Administration and Finance. Ph.) ____ -~-···-. CP-1000 Fullerton. That agreement for a one-year extension was recently confirmed in an email conversation I had with your Chancellor White. the result of which was that California State University. Chancellor._ ~ '- Craig D. Suite 1810 l Orange. California 92868! (T) 714-620-0900! (F) 714-620-0949 August 27. The failure to honor this agreement has the potential to do serious harm to our ability to operate as we have now passed the window to find a suitable facility for Western State College of Law for the next academic year due to our reliance on this agreement. Western State University of Southern California sold to California State University. ~~.. dated August 19. Given this disconcerting communication. Argosy University System 333 City Boulevard West.41 per month.ARGOSY UNIVERSITY 333 City Boulevard West. Fullerton in 2012 the buildings currently occupied by Western State College of Law at Argosy University with a leaseback through September 30. through September 30. Suite 1810 Orange. As you are aware. 2015. Please contact me at your earliest convenience so that we can discuss this matter. 20 14 President Mildred Garcia California State University. Swenson.. culminating in June.2016. a copy of which is attached for your reference. 2016 at the agreed upon rental rate of $123. CA 92868 Cell: (312) 590-0358 Attachments CC: Dean Allan Easley Linda McClintock Exhibit 5 Page 39 . Danny Kim in which he suggested that California State University.. Fullerton Office of the President 2600 Nutwood Avenue. Subsequent discussions took place earlier this year... 2014. I wanted to reach out to you to confirm our agreement for a one-year extension through September 30.294. Fullerton would not honor its agreement for the one-year extension.D.. CA 92831 Dear President Garcia. Sincerely.