Sublease (1997)Full Document 

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SUBLEASE
CB COMMERCIAL REAL ESTATE GROUP, INC.      *a wholly owned subsidiary of Journal
BROKERAGE AND MANAGEMENT                   Communications, Inc., as joint and 
LICENSED REAL ESTATE BROKER                several co-tenants.



 1. PARTIES. 
    This Sublease,  dated 11/12,  1996, is made between Journal  Communications,
    Inc.,   a   Wisconsin    corporation   and   Imperial   Printing   Company,*
    ("Sublessor"),**  and Bell  Microproducts,  Inc., a  California  corporation
    ("Sublessee").
                                                      / **SEE RIDER N0. 1 /
 2. MASTER LEASE.
    Sublessor  is the lessee  under a written  lease  dated  December  22, 1995,
    wherein  DiNapoli,   DiNapoli  and  Mulcahy  Trust,  a  California   qeneral
    partnership  ("Lessor")***  leased to Sublessor the real property located in
    the City of San Jose, County of Santa Clara, State of California,  described
    as 2020 South Tenth Street, San Jose,  California, containing  approximately
    141,520+/-  square  feet,   single-story  facility  and  connector  building
    ("Master Premises"). Said lease has been amended by the following amendments
    A Rider  with eight (8)  sections,  Exhibit  A,  Exhibit  B,  Exhibit C, and
    Disclosure  of  Special  Studies,  said  lease  and  amendments  are  herein
    collectively  referred to as the "Master  Lease" and are attached  hereto as
    Exhibit "A."
                                                      / ***SEE RIDER N0. 2 /
 3. PREMISES
    Sublessor  hereby  subleases to Sublessee  on the terms and  conditions  set
    forth  in  this  Sublease  the  following  portion  of the  Master  Premises
    ("Premises"):  2020 South Tenth  Street,  San Jose,  California,  containing
    141,520+/-  square feet,  single-story  facility and  connector  building as
    shown in Exhibit B attached hereto and made a part hereof.

 4. WARRANTY BY SUBLESSOR.
    Sublessor warrants and represents to Sublessee that the Master Lease has not
    been  amended  or  modified  except  as  expressly  set forth  herein,  that
    Sublessor is not now, and as of the commencement of the Term hereof will not
    be, in default or breach of any of the  provisions of the Master Lease,  and
    that  Sublessor has no knowledge of any claim by Lessor that Sublessor is in
    default or breach of any of the provisions of the Master Lease.

 5. TERM.    / SEE RIDER NO. 5 /

 6. RENT.
    6.1 Minimum Rent.  Sublessee shall pay to Sublessor as minimum rent, without
        deduction,  setoff,  notice, or demand,  at IPC Communication  Services,
        Inc.  2011 Senter Road,  San Jose,  California or at such other place as
        Sublessor shall designate from time to time by notice to Sublessee.
        / SEE RIDER NO. 6.1 /
        Sublessee shall pay to Sublessor upon execution of this Sublease the sum
        of  Seventy-Nine  Thousand Five Hundred  Eighty-Six and  No/1OO*********
        Dollars  ($79,586.00********)  as rent for  February  1997.  If the Term
        begins or ends on a day other than the first or last day of a month, the
        rent for the  partial  months  shall be  prorated  on a per diem  basis.
        Additional provisions: / SEE RIDER NO. 6.2 /

    6.2 Operating Costs. If the Master Lease requires Sublessor to pay to Lessor
        all or a portion  of the  expenses  of  operating  the  building  and/or
        project of which the Premises are a part ("Operating Costs"),  including
        but not limited to taxes, utilities, or insurance,  then Sublessee shall
        pay to Sublessor as additional  rent One Hundred  percent  (100%) of the
        amounts  payable by Sublessor for Operating  Costs  incurred  during the
        Term, Such

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        additional rent shall be payable as and when Operating Costs are payable
        by Sublessor to Lessor.  If the Master Lease provides for the payment by
        Sublessor of Operating Costs on the basis of an estimate  thereof,  then
        as and when adjustments between estimated and actual Operating Costs are
        made under  the Master Lease, the obligations of Sublessor and Sublessee
        hereunder shall be adjusted in a like manner; and if any such adjustment
        shall occur after the  expiration  or earlier  termination  of the Term,
        then the  obligations of Sublessor and Sublessee  under this  Subsection
        6.2 shall survive such expiration or termination.  Sublessor shall, upon
        request by Sublessee,  furnish  Sublessee  with copies of all statements
        submitted  by Lessor of actual or estimated  Operating  Costs during the
        Term.

 7. SECURITY DEPOSIT.
    Sublessee  shall  deposit with Sublessor upon execution of this Sublease the
    sum of Eighty Thousand and No/100*******************************************
    Dollars   ($80,000.00**********)   as  security  for  Sublessee's   faithful
    performance of Sublessee's  obligations hereunder ("Security  Deposit").  If
    Sublessee  fails to pay rent or other charges when due under this  Sublease,
    or fails to perform any of its other  obligations  hereunder,  Sublessor may
    use or apply all or any portion of the  Security  Deposit for the payment of
    any rent or other amount then due hereunder  and unpaid,  for the payment of
    any  other  sum for  which  Sublessor  may  become  obligated  by  reason of
    Sublessee's  default  or  breach,  or for any loss or  damage  sustained  by
    Sublessor as a result of Sublessee's default or breach. If Sublessor so uses
    any portion of the Security Deposit,  Sublessee shall,  within ten (10) days
    after written demand by Sublessor,  restore the Security Deposit to the full
    amount  originally  deposited,  and  Sublessee's  failure  to  do  so  shall
    constitute a default under this Sublease. Sublessor shall not be required to
    keep the Security Deposit separate from its general accounts, and shall have
    no obligation or liability for payment of interest on the Security  Deposit.
    In the event  Sublessor  assigns its  interest in this  Sublease,  Sublessor
    shall  deliver to its  assignee so much of the  Security  Deposit as is then
    held by Sublessor.
                                                          / SEE RIDER NO. 7 /
 8. USE OF PREMISES.
    The Premises shall be used and occupied only for office sales,  research and
    development,   light  assembly,  light  manufacturing  and  distribution  of
    electronic products and related legal uses, and for no other use or purpose.

 9. ASSIGNMENT AND SUBLETTING.
    Sublessee  shall not assign this Sublease or further  sublet all or any part
    of the Premises  without the prior  written  consent of  Sublessor  (and the
    consent of Lessor, if such is required under the terms of the Master Lease).
                                                         / SEE RIDER NO. 9 /
10. OTHER PROVISIONS OF SUBLEASE.
    Except as  otherwise  provided  in RIDER NO.  10, all  applicable  terms and
    conditions of the Master Lease are incorporated into and made a part of this
    Sublease as if Sublessor were the lessor or Landlord  thereunder,  Sublessee
    the lessee or Tenant  thereunder,  and the  Premises  the  Master  Premises,
    except for the following:
    Sections 1.03, 1.04, 1.05,  1.06,  1.08,  1.09, 1.10, 1.11,  1.12(a),  2.01,
    2.02, 3.01, 3.03, 5.01. 13.02(c),  13.06; Article 14; Rider Paragraphs 1, 5,
    6, 7, and 8 of the Rider to Lease Agreement.

    Sublessee  shall not commit or suffer any act or omission  that will violate
    any of the  provisions of the Master  Lease.  Sublessor  shall  exercise due
    diligence in attempting to cause Lessor to perform its obligations under the
    Master Lease for the benefit of Sublessee.  If the Master Lease  terminates,
    this  Sublease  shall  terminate  and the  parties  shall be relieved of any
    further liability or obligation under this Sublease,  provided however, that
    if the  Master  Lease  terminates  as a result  of a  default  or  breach by
    Sublessor or Sublessee under this Sublease and/or the Master Lease, then the
    defaulting party shall be liable to the  nondefaulting  party for the damage
    suffered as a result of such termination.  Notwithstanding the foregoing, if
    the Master Lease gives  Sublessor any right to terminate the Master Lease in
    the event of the partial or total damage,  destruction,  or  condemnation of
    the Master  Premises or the building or project of which the Master Premises
    are a part,  the exercise of such right by Sublessor  shall not constitute a
    default or breach hereunder.

11. ATTORNEYS' FEES.   / **SEE RIDER N0. 10A /
                                                            / SEE RIDER 11 /

12. AGENCY DISCLOSURE:
    Sublessor and Sublessee each warrant that they have dealt with no other real
    estate broker in connection with this transaction except: CB COMMERCIAL REAL
    ESTATE GROUP, INC., who represents Sublessor Journal Communications, Inc., a
    Wisconsin  corporation and Imperial Printing Company, a Michigan corporation
    ("Broker") and C0RNISH AND CAREY COMMERCIAL REAL ESTATE, who represents Bell
    Microproducts, Inc., a California corporation.
                   
    In the event that CB  COMMERCIAL  REAL  ESTATE GROUP, INC.  represents  both
    Sublessor and  Sublessee,  Sublessor and Sublessee  hereby confirm that they
    were timely advised of the dual  representation and that they consent to the
    same,  and that they do not expect said broker to disclose to either of them
    the confidential information of the other party.

13. COMMISSION.
    Upon  execution  of this  Sublease,  and consent  thereto by Lessor (if such
    consent is required  under the terms of the Master Lease),  Sublessor  shall
    pay Broker a real estate brokerage commission in accordance with Sublessor's
    contract  with  Broker for the  subleasing  of  the  Premises,  if any,  and
    otherwise in the amount of Two Hundred Sixty-Five Thousand and No/100 ******
    ******************** Dollars ($265,000.00********), for services rendered in
    effecting this Sublease.  Broker is hereby made a third party beneficiary of

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