Exhibit 10.22

Lease Between

The Taming Of The Shrewsbury, LLC, O’Neill Partners, LLC, and Chanski, LLC,

as tenants in common, as Landlord

And

Valeritas, LLC, as Tenant

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TABLE OF CONTENTS

 

ARTICLE 1 - REFERENCE, DEFINITIONS AND EXHIBITS

     5   

1.1 Definitions

     5   

1.2 Effect of Reference to Definitions

     12   

1.3 Exhibits

     12   

ARTICLE 2 - LEASED PREMISES, TERM AND COMMENCEMENT OF TERM

     13   

2.1 Leased Premises

     13   

2.2 Term

     13   

ARTICLE 3 - RENT, ITS DETERMINATION, COMMENCEMENT AND METHOD OF PAYMENT

     13   

3.1 Basic Rent

     13   

3.2 Additional Rent

     13   

3.3 Payment on Account of Operating Expenses

     14   

3.4 Rent

     15   

3.5 Lease to be Deemed Net

     15   

3.6 Tenant’s Right to Seek Abatement

     15   

3.7 Landlord’s Right to Seek Abatement

     16   

ARTICLE 4 - PREPAID RENT AND SECURITY DEPOSIT

     16   

ARTICLE 5 - UTILITIES AND SERVICES

     16   

5.1 Utilities

     16   

5.2 Access

     17   

5.3 Maintenance and Repair-Landlord

     17   

5.4 Demising Walls: Landlord’s Responsibility

     18   

ARTICLE 6 - INSURANCE

     18   

6.1 Required Coverage

     18   

6.2 Writing and Disposition of Insurance Policies

     19   

6.3 Mutual Waiver of Subrogation

     19   

6.4 Blanket Policies

     19   

6.5 Landlord’s Insurance Covenants

     19   

ARTICLE 7 - ADDITIONAL COVENANTS

     20   

7.1 Performing Obligations

     20   

7.2 Use

     20   

7.3 Maintenance and Repair

     20   

7.4 Compliance with Laws

     20   

7.5 Payment for Tenant’s Work

     21   

7.6 Indemnity

     21   

7.7 Personal Property at Tenant’s Risk

     22   

7.8 Payment of Landlord’s Cost of Enforcement

     22   

7.9 Yield Up

     22   

 

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7.10 Subordination

     22   

7.11 Estoppel Certificates

     22   

7.12 Nuisance

     23   

7.13 Changes and Alterations

     23   

7.14 Financial Statements

     24   

7.15 Signage

     24   

ARTICLE 8 - QUIET ENJOYMENT

     25   

ARTICLE 8.1 COMPLEMENTARY BUSINESSES

     25   

ARTICLE 9 - DAMAGE AND EMINENT DOMAIN

     25   

9.1 Fire and Other Casualty

     25   

9.2 Eminent Domain

     26   

ARTICLE 10 - DEFAULTS BY TENANT AND REMEDIES

     27   

10.1 The Condition

     27   

10.2 Reimbursement of Landlord’s Expenses

     27   

10.3 Damages

     28   

10.4 Mitigation

     28   

10.5 Claims in Bankruptcy

     28   

10.6 Late Charge

     29   

10.7 Landlord’s Right to Cure Defaults

     29   

10.8 Effect of Waiver’s of Default

     29   

ARTICLE 11 - ASSIGNMENT AND SUBLETTING

     29   

11.1 Assignment of Lease by Tenant

     29   

11.2 Subletting by Tenant

     30   

ARTICLE 12 - NOTICES

     31   

ARTICLE 13 - NOTICE OF LEASE

     31   

ARTICLE 14 - APPLICABLE LAW, SEVERABILITY, CONSTRUCTION

     31   

ARTICLE 15 - SUCCESSORS AND ASSIGNS, ETC.

     31   

ARTICLE 16 - LANDLORD’S ACCESS

     32   

ARTICLE 17 - CONDITION OF PREMISES

     33   

17.1 Landlord’s Work

     33   

17.2 Plans and Specifications

     33   

17.3 Performance and Completion of Landlord’s Work

     33   

17.4 Landlord’s Performance

     35   

17.5 Tenant’s Delay

     35   

17.6 Arbitration

     36   

 

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ARTICLE 18 - WARRANTY REGARDING BROKER

     37   

ARTICLE 19 - HAZARDOUS MATERIALS

     37   

ARTICLE 20 - EXTENSION TERMS

     38   

ARTICLE 21 - FORCE MAJEURE

     38   

ARTICLE 22 - HOLDOVER EXTENSION TERMS

     39   

ARTICLE 23 - MISCELLANEOUS

     39   

 

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ARTICLE I.—REFERENCE, DEFINITIONS AND EXHIBITS

1.1 Definitions:

 

Landlord:    The Taming Of The Shrewsbury, LLC, a Massachusetts limited
liability company, O’Neill Partners, LLC, a Hawaii limited liability company,
and Chanski, LLC, a Florida limited liability company, as tenants in common.
Original Address of Landlord:   

c/o VinCo Properties, Inc.

434 Massachusetts Avenue, Suite 5

Boston, Massachusetts 02118

Facsimile: (617) 424-9623

Tenant:    Valeritas, LLC Original Address of Tenant:   

1000C Lake Street

Ramsey, NJ 07446

Facsimile:

Address of Tenant after Term Commencement Date:   

1000C Lake Street

Ramsey, NJ 07446

Term Commencement Date:   

March 1, 2007. As of the Term Commencement Date, Landlord is required to deliver
all of the existing offices and labs (excluding the Class 100 “clean room”)
cleaned, with carpets shampooed and stains removed, walls cleaned with paint
touched-up where necessary, and with demising walls from floor to roof between
the large “clean room” space and the engineering offices as well as the demising
walls from floor to roof between the large “clean room” and the cafeteria and
quality labs, installed and spackled to final coat.

 

If the Term Commencement Date is delayed as a result of delay or other fault on
the part of the Landlord, other than as a result of Force Majeure or unless
caused by a Tenant Delay as defined in Section 17.5, Landlord shall be
responsible for paying, from March 1, 2007 to the actual Term Commencement Date,
Twenty Thousand Dollars ($20,000.00) per month due from Tenant to its current
landlord, as a result of Tenant’s inability to vacate its current leased
premises at 155 Flanders Road, Shrewsbury, MA on or before March 1, 2007.

 

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Interim Expenses    Starting on the Term Commencement Date and continuing until
the Substantial Completion Date (as defined in Section 17.3 hereof), Tenant
shall pay to the Landlord a sum of Ten Thousand Dollars ($10,000) per month
(“Interim Rent”), representing all amounts due from Tenant during such interim
period, including all utilities, taxes, rent, additional rent, CAM, or other
charges. Substantial Completion Rent    Commencing on the Substantial Completion
Date, Tenant shall no longer pay the Interim Rent, but, rather, shall pay all
Additional Rent as set forth in Section 3.2. Tenant shall not, however, be
responsible for paying Basic Rent until the Rent Commencement Date, as defined
below. Rent Commencement Date:    Three (3) months after the Substantial
Completion Date. Original Lease Term:    Ten (10) years and three (3) months
commencing on the Substantial Completion Date.

Basic Rent:

 

Period

   Annual Basic
Rent      Monthly Basic
Rent  

First Lease Year

     667,440.00         55,620.00   

Second Lease Year

     676,710.00         56,392.50   

Third Lease Year

     685,980.00         57,165.00   

Fourth Lease Year

     695,250.00         57,937.50   

Fifth Lease Year

     704,520.00         58,710.00   

Sixth Lease Year

     713,790.00         59,482.50   

Seventh Lease Year

     723,060.00         60,255.00   

Eighth Lease Year

     732,330.00         61,027.50   

Ninth Lease Year

     741,600.00         61,800.00   

Tenth Lease Year

     750,870.00         62,572.50   

First Extension Term

     

Eleventh Lease Year

     760,140.00         63,345.00   

 

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Twelfth Lease Year

     769,410.00         64,117.50   

Thirteenth Lease Year

     778,680.00         64,890.00   

Fourteenth Lease Year

     787,950.00         65,662.50   

Fifteenth Lease Year

     797,220.00         66,435.00   

Second Extension Term

     

Sixteenth Lease Year

     806,490.00         67,207.50   

Seventeenth Lease Year

     815,760.00         67,980.00   

Eighteenth Lease Year

     825,030.00         68,752.50   

Nineteenth Lease Year

     834,300.00         69,525.00   

Twentieth Lease Year

     843,570.00         70,297.50   

 

Lease Year:    A period of twelve (12) successive calendar months with the first
Lease Year commencing on the Rent Commencement Date. Notwithstanding the
foregoing: (i) if the Rent Commencement Date is a day other than the first day
of a calendar month, then the initial fractional calendar month together with
the next succeeding twelve (12) calendar months shall constitute the first Lease
Year and each succeeding Lease Year shall start on the anniversary of the first
day of the first full calendar month of the first Lease Year; and (ii) if the
expiration of the Lease Term or the earlier termination of this Lease does not
coincide with the termination of such a 12-month period, Lease Year shall mean
the portion of such 12-month period before such expiration or termination.
Leased Premises:    46,350 rentable square feet of space in the Building shown
on Exhibit A attached hereto. Right of First Refusal:    Tenant shall have a
right of first refusal to lease a minimum of 10,000 square feet of warehouse
space in the Building, which is contiguous to the Leased Premises, on an “as-is”
basis. If at any time during the Lease Term, the Landlord intends to enter into
a proposed lease (a “Proposed Lease”) for warehouse space with anyone (a
“Proposed Tenant”), and said Proposed Lease would result in there being less
than 10,000 square feet of available warehouse space which is contiguous to the
Leased Premises, Landlord shall first offer to Tenant the right to add either
the entire Proposed Lease Space, or 10,000 square feet of contiguous warehouse
space (the “Contiguous Space”), at the Tenant’s discretion, to the Leased
Premises upon the following terms and conditions.

 

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In any instance in which a Proposed Lease would result in there being less than
10,000 square feet of available warehouse space which is contiguous to the
Leased Premises, Landlord shall notify Tenant of its intention to enter into
such a Proposed Lease. Such notice shall be in writing (the “Offer Notice”) and
shall provide Tenant with specific information concerning the amount of square
footage of warehouse space which Landlord intends to lease, as well as the
specific location of such space (the “Offered Space”). In order to send the
Offer Notice, Landlord does not need to have negotiated a lease with the
Proposed Tenant but must have either a signed letter of intent or a signed term
sheet from the Proposed Tenant.

 

If Tenant, within fourteen (14) days after receipt of Landlord’s Offer Notice,
indicates in writing its unconditional agreement to exercise its rights under
this Lease to lease either the entire Proposed Lease Space, or the Contiguous
Space, at the Tenant’s discretion (“Tenant’s Notice”) in its “as-is” condition,
the Proposed Lease Space or the Contiguous Space (as elected by the Tenant)
shall be included within the Leased Premises and leased to Tenant pursuant to
the provisions of this Lease, including, without limitation, the provisions
relating to the rights and obligations of the parties with respect to
alterations. However, (i) the Basic Rent payable under this Lease shall be
increased by the amount of rent attributable to the Contiguous Space or Proposed
Lease Space (depending on which the Tenant has elected to lease) at a rental
rate of $5.50 per square foot NNN during the first five (5) Lease Years; $6.05
per square foot NNN during Lease Years 6-10; $6.66 per square foot NNN during
the first Extension Term; and $7.32 per square foot NNN during the second
Extension Term, and (ii) Tenant shall pay Additional Rent for Impositions and
Operating Expenses based on Tenant’s Proportionate Share of the Building as
adjusted to reflect the increase in the rentable square footage of space in the
Leased Premises. Landlord shall construct sheet rocked primed, spackled, and
final coated demising walls as necessary and provide heat to the Contiguous
Space or Proposed Lease Space, otherwise the Contiguous Space or Proposed Lease
Space shall be delivered to Tenant in its “as-is” condition. Time shall be of
the essence with respect to the giving of Tenant’s Notice. Tenant must accept
either the entire Proposed Lease Space or the entire 10,000 square feet of
Contiguous Space at any one time if it desires to accept any such space and may
not exercise its right with respect to less than the 10,000 square feet of
Contiguous Space.

 

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   The parties shall immediately execute an amendment to this Lease stating the
addition of the warehouse space or part of it to the Leased Premises. If Tenant
fails to provide Landlord with Tenant’s Notice within the fourteen (14) day
period described above, Landlord thereafter shall have the right to lease the
Proposed Lease Space and/or the Contiguous Space to the Proposed Tenant or any
other tenant on any terms Landlord deems appropriate. The provisions of this
section shall be operative each time any lease for any portion of the warehouse
space shall expire and Landlord intends to enter into a Proposed Lease for such
space with a Proposed Tenant. Lease Term:    The Original Lease Term, as the
same may have been extended or earlier terminated in accordance with the terms
and condition of this Lease. Option to Extend Original Lease Term:    Two
(2) options to extend for five (5) years each as more particularly set forth in
Article 20 below. Brokers:    Richards Barry Joyce & Partners LLC Building:   
The building known as 800 Boston Turnpike, Shrewsbury, Massachusetts containing
approximately 80,000 rentable square feet of space located on the Site. Parking:
   Tenant shall have the right to use, in common with others entitled thereto,
the parking spaces in the parking lot located on the Site for the purpose of
parking automobiles, subject to reasonable rules and regulations which may be
promulgated by Landlord from time to time. Permitted Uses:    Executive and
general office use, research and development, manufacturing, and laboratory use,
and for no other purpose; subject in all cases to applicable legal requirements.
Site or Property:    The approximately 6.3 acre site located in the Town of
Shrewsbury, Massachusetts, having an address of 800 Boston Turnpike, Shrewsbury,
Massachusetts, and all the buildings and improvements now or hereafter located
thereon (including, without limitation, the Leased Premises, the Building, all
roads, driveways, pavement, parking areas, landscaping, and utilities). A legal
description of the boundaries of the Site is attached hereto as Exhibit B.

 

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Force Majeure:    Strikes, lockouts, labor disputes, acts of God, inability to
obtain labor or materials or reasonable substitutes therefore for reasons beyond
the reasonable control of Landlord, governmental restrictions, governmental
regulations, governmental controls, delay in issuance of permits beyond the
reasonable control of Landlord, enemy or hostile governmental action, civil
commotion, fire or other casualty, and other causes beyond the reasonable
control of Landlord. Impositions:    All taxes including real estate taxes
(which term shall include payments in lieu of real estate taxes), assessments,
water and sewer rents, rates and charges, levies, license and permit fees and
other governmental charges, general and special, ordinary and extraordinary,
foreseen and unforeseen, of any kind and nature whatsoever, which at any time
during the Lease Term may be assessed, levied, confirmed, imposed upon, or may
become due and payable out of or in respect of, or become a lien upon, all or
any portion of the Site (including all improvements thereto), other than:
(i) municipal, state and federal income taxes (if any) assessed against
Landlord; or (ii) municipal, state or federal capital levy, gift, estate,
succession, inheritance or transfer taxes of Landlord; or (iii) corporation
excess profits or franchise taxes imposed upon any corporate owner of the Site;
or (iv) any income, profits or revenue tax, assessment or charge imposed upon
the Rent payable by Tenant under this Lease; or (v) penalties due to Landlord’s
lateness or failure to pay taxes, assessments or charges when due (unless such
lateness is due to Tenant being late in any payment due under this Lease),
(vi) taxes separately assessed or levied upon any improvements or alterations
made by Landlord or other tenants in the leased premises being leased
exclusively to another tenant in the Building, provided, however, that if at any
time during the Lease Term the methods of taxation prevailing at the
commencement of the Lease Term shall be altered so that in lieu of or as a
substitute for the whole or any part of the taxes, assessments, levies or
charges now levied, assessed or imposed on real estate and the improvements
thereon, there shall be levied, assessed and imposed a tax, assessment, levy,
imposition or charge, wholly or partially as a capital levy or otherwise, on the
rents received therefrom, or measured by or based in whole or in part upon the
Site and imposed upon Landlord, then all such taxes, assessments, levies,
impositions or charges or the part thereof so measured or based, shall be deemed
to be included within the term “Impositions” for the purposes hereof. Landlord
represents that, as of the date of this Lease, the Landlord has not entered into
a tax treaty with the Town of Shrewsbury which makes the Site currently subject
to any tax abatements or special assessments. In addition to the foregoing, the
term “Impositions” shall include any

 

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   new tax of a nature not presently in effect as of the date of this Lease, but
which may be hereafter levied, assessed, or imposed upon Landlord or all or any
portion of the Site, if such tax shall be based on or arise out of the Lease,
the ownership of the Site (or any portion thereof), or the use or occupation of
all or any portion of the Site except that any such new tax which is billed and
assessed separately upon any leased premises, use or occupation of another
tenant in the Building shall not be included in the Impositions. Notwithstanding
anything contained in this Lease to the contrary, Tenant shall pay one hundred
percent (instead of Tenant’s Proportionate Share) of any tax which is billed and
assessed separately upon the Leased Premises or the use or occupation of the
Tenant. Tenant’s Proportionate Share of the Building:    57.94% Tenant’s
Proportionate Share of the Property:    80% Operating Expenses:    The term
“Operating Expenses” shall mean all aggregate expenses incurred in the
operation, maintenance, repair, replacement, and management of the Leased
Premises (whether incurred by the Tenant or the Landlord), including without
limitation, the following: utilities supplied to the Leased Premises; all
insurance obtained and relating to or otherwise in connection with Landlord’s
ownership or the occupancy and operation of all or any portion of the Leased
Premises, the foregoing to include, without limitation, all risk insurance
against damage by fire or other casualty, liability insurance, rent loss
insurance, and any insurance required by Landlord’s Mortgagee; services obtained
for the benefit of the Site (including, without limitation, window cleaning,
rubbish removal, snow removal and grounds maintenance); repairs, replacement,
repainting, maintenance, supplies and the like for the Site; a management fee in
the amount of three and one half percent (3.5%) of the gross rental receipts
from the Property; legal fees and expenses; auditing fees and expenses; and
depreciation (on a straight line basis) for capital expenditures made by
Landlord to improve services provided to Tenant or to reduce operating expenses
(in Landlord’s reasonable judgment) amortized on a straight line basis over the
useful life of the applicable capital improvement with Tenant being responsible
for the payment of only the portion allocable to the Lease Term. The following
items shall be excluded from Operating Expenses: principal or interest payments
on any mortgages or other financing arrangements, leasing commissions and
depreciation for the Site, except as specifically provided above.

 

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   Landlord’s Work:    The work described on Exhibit C attached hereto.
Landlord’s Mortgagee:    Any party holding a mortgage on the Site including,
without limitation, the Leased Premises, given as security for indebtedness owed
by the Landlord to the holder of the mortgage. Landlord’s Construction
Representative:   

David Crocini

Crocini Consulting, LLC

121 Salem St #4B

Boston, MA 02113

Tel: (617) 699-5722

Fax:

Email: david@crocini.com

Tenant’s Construction Representative:    Scott Huie   

Tel: 508-366-2300, Ext. 222

Fax: 508-366-9852

1.2 Effect of Reference to Definitions. Any reference in this Lease to any term
defined above shall be deemed, to the extent possible, to mean and include all
aspects of the definition set forth above for such term.

1.3 Exhibits. The exhibits listed in this Section and attached to this Lease are
incorporated by reference and are a part of this Lease.

Exhibit A: Floor Plan of the Leased Premises

Exhibit B: Legal Description of the Boundaries of the Site

Exhibit C: Landlord’s Work

Exhibit D: Term Commencement Date Letter

 

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ARTICLE II—LEASED PREMISES, TERM AND COMMENCEMENT OF TERM

2.1 Leased Premises. Landlord hereby LEASES to Tenant and Tenant hereby leases
and rents from Landlord, subject to and with the benefit of the terms,
covenants, conditions and provisions of this Lease, the Leased Premises,
together with all easements, rights or privileges necessary in connection with
the use of the Leased Premises for the Permitted Uses.

2.2 Term. TO HAVE AND TO HOLD the Leased Premises for the Lease Term commencing
on the Term Commencement Date, subject to the terms, covenants, agreements and
conditions contained in this Lease.

ARTICLE III—RENT, ITS DETERMINATION, COMMENCEMENT AND METHOD OF PAYMENT

3.1 Basic Rent. Commencing on the Rent Commencement Date and continuing
thereafter on the first day of each and every calendar month occurring during
the Lease Term, Tenant shall pay Basic Rent to Landlord (or to such other person
as Landlord by written notice instructs Tenant to make such payments for
Landlord’s benefit and account) in advance in the amounts set forth in
Section 1.1 above without notice, billing or demand therefor and without any
deduction, set-off, credit or abatement of any kind. The monthly payment of
Basic Rent for any partial calendar month occurring during the Lease Term shall
be pro rated on a daily basis using the actual number of calendar days in said
month. Tenant shall pay each monthly installment of Basic Rent at the Original
Address of Landlord set forth above or at such other place as Landlord may by
written notice to Tenant direct, such notice to be effective upon receipt.

3.2 Additional Rent. Commencing on the Substantial Completion Date and
continuing throughout the Lease Term, Tenant shall also pay Additional Rent as
follows (such payments to be made when requisitioned, except as otherwise
stated):

 

  (i) Tenant’s Proportionate Share of all Impositions, all such payments to be
made when due based upon an invoice received by Tenant from Landlord together
with copies of the bills for the Impositions for the applicable period, but in
any event prior to any date on which interest or penalties would begin to accrue
on account of such Impositions if not paid according to the bill for such
Impositions (estimated fiscal year 2007 real estate taxes on the Property are
approximately $0.79 per rentable square foot, or $36,617.00 allocable to the
Leased Premises); and

 

  (ii) Tenant’s Proportionate Share of all Operating Expenses.

Commencing on the Substantial Completion Date and continuing throughout the
Lease Term, Tenant shall also pay Additional Rent as follows (such payments to
be made when requisitioned, except as otherwise stated): (i) to the extent not
paid directly by Tenant pursuant to the provisions of Article 5 hereof, one
hundred (100) percent of all utilities

 

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(including, without limitation, electricity, gas, telephone, water and sewer
charges) supplied to or consumed at the Leased Premises during the Lease Term as
measured by separate meters therefor (or prorated if and when separate meters
are not in place); and (ii) one hundred (100%) percent of any Imposition which
is billed and assessed separately upon the Leased Premises or the use or
occupation of the Tenant.

All monetary obligations of Tenant under this Lease, except for the obligation
to pay Basic Rent, shall be deemed obligations to pay Additional Rent, unless
such presumption is repugnant to the context.

3.3 Payment on Account of Operating Expenses. Tenant shall make estimated
monthly payments to Landlord to cover Tenant’s Proportionate Share of the
Operating Expenses that the Tenant is expected to owe as Additional Rent during
the current calendar year and each subsequent calendar year thereafter falling
entirely or partly within the Lease Term. The initial estimated amount of
Tenant’s Proportionate Share of the Operating Expenses expected to be incurred
for the first calendar year of the Lease Term is $69,525.00. At the beginning of
each calendar year thereafter, Landlord shall submit to Tenant a statement
setting forth Landlord’s reasonable estimates (based on costs of which Landlord
is aware and other reasonable assumptions of Landlord) of the amount of
Operating Expenses that are expected to be incurred during such calendar year,
and the computation of Tenant’s share of such anticipated Operating Expenses.
Tenant shall pay to Landlord on the first day of each month following receipt of
such statement an appropriate amount to amortize on a monthly basis Tenant’s
Proportionate Share of the anticipated Operating Expenses, with appropriate
adjustments if any period includes less than one (1) full month. If at any time
during the Lease Term Landlord in Landlord’s discretion determines it
appropriate to revise the estimates of Operating Expenses that have been
submitted, then Landlord may submit such revised estimates to Tenant, and then
commencing with the next monthly payment to be made by Tenant, appropriate
adjustment shall be made to the amount being paid by Tenant on account of
Tenant’s Proportionate Share of anticipated Operating Expenses provided,
however, that Landlord shall not make such adjustments more than twice in any
calendar year. Within ninety (90) days after the expiration of each calendar
year during the Lease Term, Landlord shall submit to Tenant a statement
certifying (i) Tenant’s Proportionate Share of the actual Operating Expenses
incurred during the preceding calendar year, (ii) the aggregate amount of the
estimated payments made by Tenant on account thereof, and (iii) any credit to
which Tenant is entitled. If Tenant is entitled to any credit, Tenant shall
deduct the amount of the overpayment from its next estimated payment or payments
for Operating Expenses for the then current year. If the Tenant’s credit is
equal to or greater than ten (10) percent of the aggregate amount paid in the
preceding year, Landlord shall reduce the anticipated operating expenses on a
going-forward basis by an amount equal to the credited amount. If Tenant’s
actual liability for such Operating Expenses exceeds the aggregate amount of the
estimated payments made by Tenant on account thereof, then Tenant shall pay to
Landlord within thirty (30) calendar days the total amount of such deficiency as
Additional Rent due hereunder. Tenant’s liability for Tenant’s share of the
Operating Expenses for the last calendar year falling entirely or partly within
the Lease Term shall survive the expiration of the Lease Term. Similarly,
Landlord’s obligation to refund to Tenant the excess, if any, of the amount of
Tenant’s actual liability therefor shall survive the expiration of the Lease
Term.

 

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With respect to Operating Expenses which Landlord allocates to the entire
Property, Tenant’s “Proportionate Share” shall be the percentage set forth in
Section 1.1 of this Lease as Tenant’s Proportionate Share of the Property as
reasonably adjusted by Landlord in the future for changes in the physical size
of the Leased Premises; and, with respect to Operating Expenses which Landlord
allocates only to the Building, Tenant’s “Proportionate Share” shall be the
percentage set forth in Section 1.1 of this Lease as Tenant’s Proportionate
Share of the Building as reasonably adjusted by Landlord in the future for
changes in the physical size of the Leased Premises or the Building. Landlord
may equitably increase Tenant’s Proportionate Share for any item of expense or
cost reimbursable by Tenant that relates to a repair, replacement, or service
that benefits only the Leased Premises or only a portion of the Property or
Building or that varies with occupancy or use. The estimated Operating Expenses
for the Premises set forth above are only estimates, and Landlord makes no
guaranty or warranty that such estimates will be accurate.

Tenant or an independent, certified public accountant designated by Tenant shall
have the right, during regular business hours and after giving fifteen
(15) days’ advance written notice to Landlord, to inspect and audit Landlord’s
books and records relating to the Operating Expenses billed during any calendar
year falling within the Lease Term for a period of one (1) year following the
receipt by Tenant of any statement submitted pursuant to this Section. If as a
result of such audit it becomes clear that an error was made in the calculation
of Tenant’s Proportionate Share of Operating Expenses, then an appropriate
adjustment shall be made within thirty (30) days of Landlord’s receipt from
Tenant of a copy of such audit together with Tenant’s demand for reimbursement
and, if the amount by which Landlord over-charged Tenant exceeds ten
(10%) percent of Tenant’s Proportionate Share of Operating Expenses, then
Landlord shall pay the reasonable actual out-of-pocket costs and expenses paid
by Tenant for the audit.

3.4 Rent. References in this Lease to “Rent” or “rent” shall be deemed to
include both Basic Rent and Additional Rent when the context so allows.

3.5 Lease to be Deemed Net. This Lease shall be deemed and construed to be an
absolutely net lease and Tenant shall accordingly pay to Landlord, absolutely
net, the Basic Rent and Additional Rent, free of any off-sets or deductions of
any kind.

3.6 Tenant’s Right to Seek Abatement. If Tenant occupies more than fifty-one
(51%) percent of the rentable area of the Building or if the Leased Premises is
separately assessed for real estate taxes, then Tenant shall have the right,
upon prior written notice to Landlord, to seek a reduction in the valuation of
the Leased Premises assessed for tax purposes and to contest in good faith by
appropriate proceedings, at Tenant’s expense, the amount or validity in whole or
in part of any Imposition or of the method by which any Imposition is
calculated, assessed or imposed; and may defer payment thereof if allowed by
law, provided that (i) Tenant shall provide Landlord with security reasonably
satisfactory to Landlord to assure payment of contested items; and (ii) Tenant
shall immediately pay such contested item or items if the protection of the
Leased Premises or of the Landlord’s interest therein from any lien or claim
shall, in the reasonable judgment of Landlord, require such payment.

 

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3.7 Landlord’s Right to Seek Abatement. Landlord shall have the right to seek a
reduction in the valuation of the Site or any of the Building assessed for tax
purposes and to prosecute any action or proceeding theretofore commenced by
Tenant. To the extent to which any tax refund payable as a result of any
proceeding which Landlord or Tenant may institute, or payable by reason of
compromise or settlement of any such proceeding, may be based upon a payment
made by Tenant, then Tenant shall be authorized to collect the same (or the
appropriate portion thereof), subject, however, to Tenant’s obligation to
reimburse Landlord forthwith for Tenant’s Proportionate Share of any expense
incurred by Landlord in connection therewith.

Landlord shall not be required to join in any proceedings referred to in
Section 3.6 hereof unless the provisions of any law, rule or regulation at the
time in effect shall require that such proceedings be brought by or in the name
of Landlord, in which event Landlord shall join in such proceedings or permit
the same to be brought in its name. Landlord shall not be subjected to any
liability for the payment of any costs or expenses in connection with any such
proceedings, and Tenant shall indemnify and save harmless Landlord from any such
costs and expenses. Tenant shall be entitled to any refund of its share of any
Imposition and penalties or interest thereon received by Landlord that has been
paid by Tenant, or that has been paid by Landlord but previously reimbursed in
full by Tenant.

ARTICLE 4—PREPAID RENT AND SECURITY DEPOSIT

Upon the signing of this lease, Tenant shall pay to Landlord One Hundred
Thousand Dollars ($100,000.00), representing a security deposit as security for
Tenant’s full performance of all terms and conditions under this Lease. Upon the
Substantial Completion Date, the Tenant shall pay to Landlord an additional One
Hundred Thousand Dollars ($100,000.00), representing additional security for
Tenant’s full performance of all terms and conditions under this Lease
(collectively, the “Security Deposit”). Upon the exercise of the outstanding
warrants that will raise approximately $90,000,000 or achievement of $4,000,000
in sales revenue, whichever event comes first, the Security Deposit shall be
reduced to One Hundred Thousand Dollars ($100,000). Upon default by Tenant
hereunder, the Landlord shall have the right, without the giving of any notice,
to apply all or any portion of the Security Deposit to cure such default which
right shall be in addition to all other rights and remedies. Within thirty
(30) days of the later to occur of the last day of the Lease Term or the date
that Tenant yields up the Leased Premises pursuant to the terms of this Lease,
Landlord shall return to Tenant the Security Deposit less any amounts which
Landlord may have deducted pursuant to the terms of this Lease.

ARTICLE 5—UTILITIES AND SERVICES

5.1 Utilities. Tenant shall make arrangements with appropriate utility or
service companies for its own service for any utilities and/or services that are
to serve the Leased Premises exclusively or directly and that can be billed to
Tenant directly, and Tenant shall promptly pay all costs with respect to same,
such payments to be made, to the extent possible, directly to the utility or
service provider or to the appropriate party charged with collecting the same,
the foregoing to include all charges for such utilities or services. All
internal utilities shall be separately metered. All costs for external utilities
that are not separately metered shall be included in Operating Expenses, and
Tenant shall be responsible for Tenant’s Proportionate Share thereof. Landlord
shall be under no obligation to furnish any utilities or services to the

 

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Leased Premises and shall not be liable for any interruption or failure in the
supply of any such utilities or services to the Leased Premises. No interruption
or failure of utilities shall result in the termination of this Lease; provided,
however, that if (i) an interruption or cessation of utilities shall occur,
except if the same is due to any act or neglect of Tenant or Tenant’s agents,
employees, contractors or invitees or any person claiming by, through or under
Tenant (a “Service Interruption”), and (ii) such Service Interruption occurs or
continues as a result of the negligence or wrongful conduct of the Landlord or
Landlord’s agents, employees or contractors, and (iii) such Service Interruption
continues for more than one (1) full business day after Landlord shall have
received notice thereof from Tenant, and (iv) as a result of such Service
Interruption, the conduct of Tenant’s normal operations in the Leased Premises
are materially and adversely affected, then there shall be an abatement of one
day’s Rent for each day during which such Service Interruption continues after
such one (1) business day; provided, however, that if any part of the Leased
Premises is reasonably useable for Tenant’s normal business operations or if
Tenant conducts all or any part of its operations in any portion of the Leased
Premises notwithstanding such Service Interruption, then the amount of each
daily abatement of Base Rent shall only be proportionate to the nature and
extent of the interruption of Tenant’s normal operations or ability to use the
Leased Premises.

5.2 Access. Tenant shall have access to the Leased Premises twenty-four hours a
day, seven days a week, three hundred sixty-five days per year, and Tenant shall
be solely responsible, at Tenant’s sole cost and expense, for security for the
Leased Premises.

5.3 Maintenance and Repair—Landlord. Prior to the Term Commencement Date,
Landlord shall install on the grounds of the Property a fully operational
automatic irrigation system (sprinklers), as part of Landlord’s Work described
on Exhibit C attached hereto. Landlord shall be responsible for the maintenance,
repair and replacement of the Building’s roof, public areas, exterior walls,
windows, foundation, and structural walls of the Building and all Building
plumbing, mechanical, and electrical systems existing in the Building as of the
date hereof or installed by Landlord prior to the Term Commencement Date (but
specifically excluding any supplemental heating, ventilation or air conditioning
equipment or systems installed by Tenant), except that Landlord shall in no
event be responsible to Tenant for any condition in the Leased Premises or the
Building caused by any act or neglect of Tenant, its invitees or contractors.
Landlord shall also keep and maintain all common facilities in a good and clean
order, condition and repair, free of snow and ice and accumulation of dirt and
rubbish, and shall keep and maintain all landscaped areas on the Property in a
neat and orderly condition, to a commercially reasonable standard equal to or
exceeding that of comparable first-class office and research and development
properties in the greater Worcester, Massachusetts area. The costs of any such
maintenance, repair and replacement by Landlord shall be Operating Expenses and
be paid in accordance with Section 3.3 hereof, provided, however, that costs
that are required to be capitalized for federal income tax purposes shall be
amortized on a straight line basis over a period equal to the lesser of the
useful life thereof for federal income tax purposes or ten (10) years and
included in Operating Expenses only to the extent of the amortized amount for
the respective calendar year. The terms “walls” and “windows” as used in this
Section 5.3 shall not include glass or plate glass, doors or overhead doors,
special store fronts, dock bumpers, dock plates or levelers, or office entries,
all of which shall be maintained by Tenant. Landlord shall not be responsible to
make any improvements or repairs to the Building or Property other than as

 

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expressly provided in this Section 5.3, unless expressly provided otherwise in
this Lease. Tenant shall promptly give Landlord written notice of any repair
required by Landlord pursuant to this Section 5.3, after which Landlord shall
have a reasonable opportunity to repair such item. Landlord shall never be
liable for any failure to make repairs which Landlord has undertaken to make
under the provisions of this Section 5.3 or elsewhere in this Lease, unless
Tenant has given notice to Landlord of the need to make such repairs, and
Landlord has failed to commence to make such repairs within a reasonable time
after receipt of such notice, or fails to proceed with reasonable diligence to
complete such repairs.

5.4 Demising Walls: Landlord’s Responsibility. It shall be the Landlord’s
exclusive responsibility to erect demising walls and/or connecting doors between
the Leased Premises and the warehouse space. If the Landlord fails to erect such
walls and/or doors after notification by the Tenant of the need for the same,
the Tenant shall have the right, but not the responsibility, to erect such walls
and/or doors without further consent or permission from the Landlord. The
Landlord shall be solely and exclusively responsible for all heating and cooling
costs incurred by Landlord or Tenant as a result of the lack of such walls
and/or doors.

ARTICLE 6—INSURANCE

6.1 Required Coverage. Tenant covenants and agrees with Landlord that during the
Lease Term the following insurance shall be obtained by Tenant and carried at
Tenant’s sole expense:

(a) Tenant’s commercial general liability insurance insuring and indemnifying
Tenant, Landlord, and Landlord’s Mortgagee against liability for injury to
persons and damage to property which may be claimed to have occurred upon the
Leased Premises or the sidewalks, ways and other real property adjoining said
Leased Premises and covering all Tenant’s obligations under this Lease and with
limits at least as high as the amounts respectively stated below, or such higher
limits in any case as may reasonably be required in case of increase in risk or
as may be customarily carried in Massachusetts by prudent occupants of similar
property, as determined by Landlord in its reasonable discretion: not less than
commercial general liability insurance in the amount of $1,000,000 per
occurrence, $2,000,000 general aggregate, $1,000,000 per accident combined
single limit for automobile liability, $2,000,000 in excess liability coverage,
and $1,000,000 for property damage.

(b) Workmen’s Compensation covering all Tenant’s employees, contractors and
agents working on the Premises.

(c) Insurance insuring all of Tenant’s personal property, chattels, inventory,
trade fixtures, furniture, furnishings, machinery, equipment, goods, supplies
and stock of every kind and description stored, kept, installed or used in or
upon the Leased Premises against damage, loss or destruction by fire, explosion,
water damage or other casualty, in an amount at least equal to the replacement
cost of such insured property.

(d) Such additional insurance (including, without limitation, rent loss
insurance) as Landlord’s Mortgagee shall reasonably require provided that such
insurance is in an amount, of the type, and customary for comparable properties.

 

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6.2 Writing and Disposition of Insurance Policies. All insurance required under
Section 6.1 above shall be written with companies reasonably satisfactory to
Landlord and in forms customarily in use from time to time in the Greater Boston
area. Tenant shall furnish the Landlord with duplicates of said policies, and
said policies shall (i) name Landlord and Landlord’s Mortgagee as named
insureds, as their respective interests may appear, and (ii) provide that the
coverage thereunder may not lapse or be canceled without twenty (20) days prior
written notice to Landlord, Landlord’s Mortgagee and Tenant.

6.3 Mutual Waiver of Subrogation. Landlord and Tenant each hereby releases the
other, its officers, directors, employees and agents, from any and all liability
or responsibility (to the other or anyone claiming through or under them by way
of subrogation or otherwise) for any loss or damage to property covered by valid
and collectible insurance, even if such loss or damage shall have been caused by
the fault or negligence of the other party, or anyone for whom such party may be
responsible. However, this release shall be applicable and in force and effect
only with respect to loss or damage (a) actually recovered from an insurance
company and (b) occurring during such time as the releaser’s insurance policies
shall contain a clause or endorsement to the effect that any such release shall
not adversely affect or impair said policies or prejudice the right of the
releaser to recover thereunder. Landlord and Tenant each agrees that any fire
and extended coverage insurance policies will include such a clause or
endorsement as long as the same shall be obtainable without extra costs, or, if
extra cost shall be charged therefor, so long as the other party pays such extra
cost. If extra cost shall be chargeable therefor, each party shall advise the
other party and of the amount of the extra cost, and the other party, at its
election, may pay the same, but shall not be obligated to do so.

6.4 Blanket Policies. Nothing contained herein shall prevent Tenant from taking
out insurance of the kind and in the amounts provided for herein under a blanket
insurance policy or policies covering properties other than the Leased Premises,
provided however, that any such policy or policies of blanket insurance
(a) shall specify therein, or Tenant shall furnish Landlord with the written
statement from the insurers under such policy or policies, specifying the amount
of the total insurance allocated to the Leased Premises, which amounts shall not
be less than the amounts required herein, and (b) amounts so specified shall be
sufficient to prevent any of the insureds from being a co-insurer within the
terms of the applicable policy or policies, and provided further, however, that
any such policy or policies of blanket insurance shall, as to the Leased
Premises, otherwise comply as to endorsements and coverage with the provisions
herein.

6.5 Landlord’s Insurance Covenants. Landlord covenants and agrees that during
the Lease Term it shall obtain the following insurance:

(a) All risk insurance against damage by fire or other casualty in an amount at
least equal to the replacement costs of the Building as determined from time to
time by Landlord or (at Landlord’s election or upon Tenant’s request) by
appraisal made at the expense of Tenant by an accredited insurance appraiser
approved by Landlord;

 

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(b) Commercial general liability insurance covering liability for injury to
persons and damage to property which may be claimed to have occurred upon the
Property or the sidewalks, ways and other real property adjoining the Property
caused by Landlord with limits at least as high as the following amounts:
$1,000,000 per occurrence, $2,000,000 general aggregate;

(c) Workmen’s Compensation covering all Landlord’s employees and Landlord shall
cause all contractors and agents working for Landlord on the Property to carry
workmen’s compensation insurance covering their employees as may be required by
law;

(d) Rent loss insurance with a limit at least equal to one (1) year’s worth of
Rent due under this Lease; and

(e) Such additional insurance as Landlord’s Mortgagee shall reasonably require.

Tenant shall pay the Tenant’s Proportionate Share (57.94 percent) of the cost of
such insurance as an Operating Expense. At the request of Tenant, Landlord will
provide to Tenant copies of certificates or the relevant portions of such
policies to evidence the fact that Landlord is maintaining the insurance
required by this Section 6.5.

ARTICLE 7—ADDITIONAL COVENANTS

Tenant covenants and agrees during the Lease Term and such further time as
Tenant occupies the Leased Premises or any part thereof:

7.1 Performing Obligations. To perform fully, faithfully and punctually all of
the obligations of Tenant set forth in this Lease; and to pay when due Rent and
all charges, rates and other sums which by the terms of this Lease are to be
paid by Tenant.

7.2 Use. To use the Leased Premises only for the Permitted Uses, and for no
other purposes.

7.3 Maintenance and Repair—Tenant. At Tenant’s expense, and except for
Landlord’s obligations set forth in Section 5.3 hereof, reasonable wear and tear
and damage from fire or other casualty, to keep the Leased Premises, including
all interior and exterior glass, clean, neat and in good order, repair and
condition, and to keep the Leased Premises in as good condition, order and
repair as the same are at the Term Commencement Date or thereafter may be put,
reasonable wear and use and damage by fire or other casualty only excepted, it
being understood that the foregoing exception for reasonable wear and use shall
not relieve Tenant from the obligation to keep the Leased Premises in good
order, repair and condition including, without limitation, all necessary and
ordinary non-structural repairs, replacements and the like. Tenant also agrees
to abide by reasonable rules and regulations that Landlord may adopt from time
to time.

7.4 Compliance with Laws. At Tenant’s expense, to comply promptly with all
present and future laws, ordinances, orders, rules, regulations and requirements
of all federal, state and municipal governments, departments, commissions,
boards and officials, foreseen and unforeseen, ordinary as well as
extraordinary, which may be applicable to the Leased Premises

 

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or to Tenant’s use, occupancy or presence in or at the Leased Premises or the
Site, including all laws with respect to the handling, storage and disposal of
any hereinafter defined Hazardous Materials, except that the Tenant may defer
compliance so long as the validity of any such law, ordinance, order, rule,
regulation or requirement shall be contested by Tenant in good faith and by
appropriate legal proceedings, and:

(a) If by the terms of such law, ordinance, order, rule regulation or
requirement, compliance therewith pending the prosecution of any such proceeding
may legally be delayed without the incurrence of any lien, charge or liability
of any kind against the Leased Premises or Site and without subjecting Tenant or
Landlord to any liability, civil or criminal, for failure so to comply
therewith, Tenant may delay compliance therewith until the final determination
of such proceeding, or

(b) If any lien, charge or civil liability would be incurred by reason of any
such delay, Tenant nevertheless may contest as aforesaid and delay as aforesaid,
provided that such delay would not subject Landlord to criminal liability or
fine, and Tenant (i) furnishes to Landlord security, reasonably satisfactory to
Landlord, against any loss or injury by reason of such contest or delay, and
(ii) prosecutes the contest with due diligence.

To the best of Landlord’s knowledge, as of the date of this Lease the Building
is in compliance with all applicable laws, rules and regulations.

7.5 Payment for Tenant’s Work. To pay promptly when due the entire cost of any
work at or on the Leased Premises undertaken by Tenant so that the Leased
Premises shall at all times be free of liens for labor and materials; promptly
to clear the record of any notice of any such lien; to procure all necessary
permits and before undertaking such work; to do all of such work in a good and
workmanlike manner, employing materials of good quality and complying with all
governmental requirements; and to save Landlord harmless and indemnified from
all injury, loss, claims or damage to any person or property occasioned by or
growing out of such work.

7.6 Indemnity. To save Landlord harmless and indemnified from, and to defend
Landlord against, all injury, loss, claims or damage (including reasonable
attorneys’ fees) to any person or property while on the Leased Premises unless
arising from any act, omission, fault, negligence or other misconduct of
Landlord, or its agents, servants, employees, or contractors; to save Landlord
harmless and indemnified from, and to defend Landlord against, all injury, loss,
claims or damage (including reasonable attorneys’ fees) to any person or
property anywhere occasioned by any act, omission, neglect or default of Tenant
or Tenant’s agents, servants, employees, contractors, guests, invitees or
licensees unless arising from any act, omission, fault, negligence or other
misconduct of Landlord, or its agents, servants, employees, or contractors.
Landlord shall save Tenant harmless and indemnified from, and defend Tenant
against, all injury, loss, claims or damage (including reasonable attorneys’
fees) to any person while on the Leased Premises to the extent caused by the
act, omission, fault, negligence or other misconduct of Landlord and not caused
by any contributory act or omission of Tenant.

 

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7.7 Personal Property at Tenant’s Risk. That all personal property, equipment,
inventory and the like from time to time upon the Leased Premises shall be at
the sole risk of Tenant; and that Landlord shall not be liable for any damage
which may be caused to such property or the Leased Premises or to any person for
any reason including, without limitation, the bursting or leaking of or
condensation from any plumbing, cooling or heating pipe or fixture.

7.8 Payment of Cost of Enforcement. Each Party covenants to pay on demand the
other Party’s expenses, including reasonable attorneys’ fees, incurred in
enforcing any obligation under this Lease or in curing any default by Tenant
under this Lease, provided that the Party claiming under this Section is
successful in enforcing such obligation or has a right under this Lease to cure
such default.

7.9 Yield Up. At the termination of this Lease, peaceably to yield up the Leased
Premises clean and in good order, repair and condition, reasonable wear and tear
and damage by fire or casualty excepted and remove all equipment, furniture and
personal property; and at either Landlord’s or Tenant’s option, to remove any
and all of Tenant’s trade fixtures, provided however, that Tenant shall restore
any damage caused by such removal and provided further that if Tenant fails so
to restore the Leased Premises, then Tenant shall pay all of Landlord’s costs to
make such restoration.

7.10 Subordination. Within fifteen (15) days after written request by Landlord
to Tenant, to execute and deliver all such instruments as may reasonably be
requested to subordinate this Lease to any mortgages or deeds of trust securing
notes or bonds executed by Landlord and to all advances made thereunder and to
the interest thereon and all renewals, replacements and extensions thereof,
provided that the mortgagee or trustee shall agree to recognize this Lease in
the event of foreclosure and perform all of the covenants contained herein to be
performed by Landlord, if Tenant is not in default beyond the expiration of any
period allowed for the cure of such default. Any such mortgagee or trustee may
at any time subordinate its mortgage or deed of trust to this Lease, without
Tenant’s consent, by notice in writing to Tenant and thereupon this Lease shall
be deemed prior to such mortgage or deed of trust without regard to their
respective dates of execution, delivery and recording; and in that event such
mortgagee or trustee shall have the same rights with respect to the Lease as
though it had been executed and delivered (and notice thereof recorded) prior to
the execution and delivery and recording of the mortgage or deed of trust.
Landlord agrees to use commercially reasonable efforts to obtain a recognition
and non-disturbance agreement from the present mortgagee of record in a form
reasonably satisfactory to Tenant.

7.11 Estoppel Certificates. From time to time, for delivery to a prospective
purchaser or mortgagee of the Leased Premises or the Site or to any assignee of
any mortgage of the Leased Premises or the Site or to the Massachusetts
Development Finance Agency or to any other lender or prospective lender of the
Tenant, within ten (10) days after written request by Landlord to Tenant or by
Tenant to Landlord, the party receiving the request shall execute, acknowledge
and deliver to the other party a statement in writing certifying: (a) that this
Lease is unamended (or, if there have been any amendments, stating the
amendments); (b) that it is then in full force and effect and without any
existing defaults, if that be the fact; (c) a description of the leased
premises; (d) the term of the lease and any existing purchase or renewal
options; (e) the rent and

 

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additional rent due and the dates to which Rent and any other payments to
Landlord have been paid; (f) the amounts of any security deposits paid pursuant
to this lease; (g) any defenses, offsets and counterclaims which Tenant, at the
time of the execution of said statement, believes that Tenant has with respect
to Tenant’s obligation to pay Rent and to perform any other obligations under
this Lease or that there are none, if that be the fact; and (h) such other data
as may reasonably be requested. Any prospective purchaser or mortgagee of the
Leased Premises, or portion thereof, or any assignee of any mortgagee of the
Leased Premises, or portion thereof or the Massachusetts Development Finance
Agency or any other lender or prospective lender of the Tenant, may rely upon
such statement.

7.12 Nuisance. At all times during the Lease Term and such further time as the
Tenant occupies the Leased Premises, not to injure, overload, deface or
otherwise harm the Leased Premises; nor commit any nuisance; nor to do or suffer
any waste to the Leased Premises; nor permit the emission of any objectionable
noise or odor; nor make any use of the Leased Premises which is improper, or
contrary to any law or ordinance or which will invalidate any insurance policy
or other applicable legal requirement covering the Leased Premises or any
portion thereof, including, without limitation, the handling, storage and
disposal of any hazardous material.

7.13 Changes and Alterations. Except as otherwise explicitly set forth herein,
Tenant shall have no authority, without the express written consent of Landlord
to alter, remodel, reconstruct, demolish, add to, improve or otherwise change
the Leased Premises, except that Tenant shall have such authority, without the
consent of Landlord, to build substructures; add, remove, or modify internal
wiring; erect or remove non-load bearing walls; add or remove internal doors;
construct internal clean room(s); make repairs to the Leased Premises and do
such other things as are appropriate to comply with the obligations imposed on
Tenant under other provisions of this Lease.

Except as otherwise outlined herein, Tenant shall not construct or permit any
alterations, installations, additions or improvements including any interior or
exterior signs (“Alterations”) to the Leased Premises or the Building without
having first submitted to Landlord plans and specifications therefor for
Landlord’s approval, which approval shall not be unreasonably withheld or
delayed provided that:

(a) if the improvement involves a sign or will otherwise be visible from the
exterior then the improvement must be compatible with the architectural and
aesthetic qualities of the Leased Premises and the Site; and

(b) the improvement must be non-structural and have no effect on the plumbing,
heating (and cooling), mechanical, electrical or other systems or services in
the Leased Premises, and the improvement (except for signs) must be entirely
within the Leased Premises; and

(c) the change, when completed will not materially adversely affect the value of
the Leased Premises or the Site; and

 

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(d) Tenant demonstrates to Landlord’s satisfaction that the improvement will be
made in accordance with applicable legal requirements using good quality
materials and good quality construction practices and will not result in any
liens on the Leased Premises; and

(e) as soon as such work is completed, Tenant will have prepared and provide
Landlord with “as-built” plans (in form acceptable to Landlord) showing all such
work; and

(f) Tenant will comply with any rules or requirements reasonably promulgated by
Landlord in connection with the doing of any work, and if requested by Landlord,
Tenant will obtain and maintain Builder’s Risk insurance in connection with such
work.

Tenant shall have the right to make minor alterations from time to time in the
interior of the Leased Premises without obtaining Landlord’s prior written
consent therefor, provided that all of such work conforms to all of the above
requirements in all respects (except for the requirement in subsection (a) to
obtain Landlord’s prior written consent and the requirement in subsection (e) to
provide “as-built” plans to Landlord), and further provided that Tenant provides
Landlord with a written description of such work (and such other data as
Landlord may request) not later than 30 days after each such alteration is made.

7.14 Financial Statements. Within ten (10) days of Landlord’s request, Tenant
shall furnish Landlord its most recent statement of income and balance sheet for
the immediately preceding fiscal year certified by an independent certified
public accountant and prepared in accordance with generally accepted accounting
principles consistently applied. Nothing contained in this Section shall be
construed to require the Tenant to create or commission the creation of a
financial statement, but rather Tenant is obligated only to produce to Landlord
(upon request) a copy of the most current existing financial statement.

7.15 Signage. Tenant, at Tenant’s sole cost and expense, shall have the right to
install signage in its lobby, on any Building directory, on the exterior of the
Building, and on the pylon sign for the Building at the highest level and the
largest allowed for sign panels of lessees or occupants of the Building,
provided that Tenant obtains all necessary permits, complies with all applicable
laws, complies with Section 7.13 of this Lease, and obtains the prior written
consent of the Landlord (which consent shall not be unreasonably withheld or
delayed provided that Tenant delivers to Landlord reasonably detailed plans and
specifications for the sign).

Tenant’s right to erect signage on the Route 9 side of the Property shall be an
exclusive right. Landlord agrees that no other signage will be authorized or
permitted on the Route 9 side of the Property. Tenant shall also have the right
to erect signage on the Chestnut Street side of the Property. Landlord agrees
that Tenant’s signage on the Chestnut Street side of the Property shall be the
most prominent signage, both in terms of size and placement. Landlord may allow
two other building tenants to erect signage on the Chestnut Street side of the
Property, subject to Tenant’s approval of the size, placement, and appearance of
said signage, which approval shall not be unreasonably withheld.

 

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ARTICLE 8—QUIET ENJOYMENT

Landlord covenants that Tenant on paying the Rent and performing Tenant’s
obligations under this Lease shall peacefully and quietly have, hold and enjoy
the Leased Premises throughout the Lease Term or until it is terminated as in
this Lease provided without hindrance by Landlord or by anyone claiming by,
through or under Landlord.

ARTICLE 8.1 – COMPLEMENTARY BUSINESSES

Landlord covenants that it shall not, during the Lease Term (or any extension
thereto), lease any other space in the Building for a use that would materially
interfere with the Tenant’s use of the Leased Premises for executive and general
office use, research and development, manufacturing, and laboratory use.
Landlord agrees further that, to the extent that Landlord leases other space in
the Building, such other leased premises shall have separate utilities and
separate heating, ventilating and air conditioning systems designed to avoid any
cross-contamination between the Leased Premises and such other leased premises.

ARTICLE 9—DAMAGE AND EMINENT DOMAIN

9.1 Fire and Other Casualty. In the event that at any time during the term
hereof (including any extended term) the Leased Premises are totally damaged or
destroyed by fire or other casualty or substantially damaged so as to render
them or a material portion thereof untenantable, then there shall be a just and
proportionate abatement of the Rent payable hereunder until the Leased Premises
are made suitable for Tenant’s occupancy, and the Lease Term shall be extended,
without the necessity of further action by any party, for a period equal to the
time during which Rent so abated. In the event of such substantial (or total)
damage to the Leased Premises, Landlord shall proceed at its expense and with
reasonable diligence to repair and restore the Leased Premises to substantially
the same condition they were in immediately prior to such casualty.
Notwithstanding the foregoing, if Landlord in its sole discretion determines
that timely restoration is not possible or practical or that there are or will
be insufficient insurance proceeds available to Landlord to accomplish same,
then Landlord shall have the right to terminate this Lease by written notice
given to Tenant within ninety (90) days after the occurrence of such casualty.

If Landlord proceeds with the repair and restoration of the Leased Premises, in
the event the Leased Premises have not been restored to a condition
substantially suitable for their intended purpose within one hundred eighty
(180) days following said casualty, then either Landlord or Tenant shall have
the right to terminate this Lease by giving notice thereof to the other party
within thirty (30) days after the expiration of such period (as so extended)
provided that such restoration is not completed within such period. This Lease
shall cease and come to an end without further liability or obligation on the
part of either party thirty (30) days after such giving of notice unless within
such thirty-day period Landlord substantially completes such restoration. Such
right of termination shall be Tenant’s sole and exclusive remedy at law or in
equity for Landlord’s failure so to complete such restoration, and time shall be
of the essence with respect thereto.

 

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9.2 Eminent Domain. Landlord reserves for itself all rights to any damages or
awards with respect to the Leased Premises and the leasehold estate hereby
created by reason of any exercise of the right of eminent domain, or by reason
of anything lawfully done in pursuance of any public or other authority; and by
way of confirmation Tenant grants and assigns to Landlord all Tenant’s rights to
such damages so reserved, except as otherwise provided herein. Tenant covenants
to execute and deliver any instruments confirming such assignment as Landlord
may from time to time reasonably request. If all the Leased Premises are taken
by eminent domain, this Lease shall terminate when Tenant is required to vacate
the Leased Premises or such earlier date as the Tenant is required to begin the
payments of rent to the taking authority. If a partial taking by eminent domain
results in so much of the Leased Premises being taken as to render the Leased
Premises or a material portion thereof unsuitable for Tenant’s continued use and
occupancy as determined by either party in its reasonable discretion, either
Landlord or Tenant may elect to terminate this Lease as of the date when the
Tenant is required to vacate the portion of the Leased Premises so taken, by
written notice to the other given not more than ninety (90) days after the date
on which Tenant or Landlord, as the case may be, receives notice of the taking.
For purposes of this paragraph, a “material portion” of the Leased Premises
shall mean in excess of twenty-five percent (25%) of the total square footage of
the Leased Premises. If a partial taking by eminent domain does not result in
such portion of the Leased Premises as aforesaid being taken, then this Lease
shall not be terminated or otherwise affected by any exercise of the right of
eminent domain.

Whenever any portion of the Lease Premises shall be taken by any exercise of the
right of eminent domain, and if this Lease shall not be terminated in accordance
with the provisions of this Section 9.2, Landlord shall, at its expense,
proceeding with all reasonable dispatch, provided sufficient condemnation
proceeds are available therefor (or, if not, provided Tenant provides additional
funds needed above the amount of the condemnation proceeds available) do such
work as may be required to restore the Leased Premises or what remains thereof
(not including Tenant’s trade fixtures, business equipment and furniture) as
nearly as may be to the condition they were in immediately prior to such taking,
and Tenant shall at its expense, proceeding with all reasonable dispatch, do
such work to its trade fixtures, business equipment and furniture, as may be
required. A just proportion of the Rent payable hereunder, according to the
nature and extent of the taking shall be abated from the time Tenant is required
to vacate that portion of the Leased Premises taken. If the Premises have not
been restored to a condition substantially suitable for their intended purpose
within two hundred seventy (270) days following said taking, then either
Landlord or Tenant shall have the right to terminate this Lease by giving notice
thereof to the other party within thirty (30) days after the expiration of such
period provided that such restoration is not completed within such period. This
Lease shall cease and come to an end without further liability or obligation on
the part of either party thirty (30) days after such giving of notice unless,
within such thirty-day period, Landlord substantially completes such
restoration. Such right of termination shall be Tenant’s sole and exclusive
remedy at law or in equity for Landlord’s failure so to complete such
restoration, and time shall be of the essence with respect thereto.

Landlord warrants and represents that it is unaware of any currently pending or
potential governmental takings or planned takings of any of the Leased Premises.

 

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ARTICLE 10—DEFAULTS BY TENANT AND REMEDIES

10.1 The Condition. This Lease is made on the condition that if any default by
Tenant continues, in case of payment of Rent or other monetary payments due
hereunder for more than seven (7) business days after written notice thereof to
Tenant (provided, however, that Tenant shall be entitled to only two (2) such
notices during each calendar year and if, subsequently in any such calendar
year, Tenant does not make a payment of Rent within seven (7) business days of
such payment being due, Landlord shall have all the rights set forth herein
without the need of any notice), or in the case of a non-monetary default for
more than thirty (30) days after written notice thereof to Tenant (provided,
however, that if such default is susceptible of being cured but such cure cannot
be accomplished with reasonable diligence within said period of time and if
Tenant commences to cure such default promptly after receipt of notice thereof
from Landlord and thereafter prosecutes the curing of such default with
reasonable diligence, such period of time shall be extended for such additional
time as may be necessary to cure such default with reasonable diligence, but not
to exceed an additional thirty (30) days); or if Tenant becomes insolvent, makes
any assignment for the benefit of creditors, commits any act of bankruptcy or
files a petition under any bankruptcy or insolvency law; or if such a petition
filed against Tenant is not dismissed within thirty (30) days; or if a receiver
or similar officer becomes entitled to Tenant’s interest in this Lease and it is
not returned to Tenant within thirty (30) days; or if Tenant’s interest in this
Lease is taken on execution or other process of law in any action against
Tenant; or if Tenant fails to obtain any insurance required to be maintained by
Tenant pursuant to this Lease or any such insurance shall be cancelled or
terminated or shall expire or shall be reduced or materially changed, except, in
each case, as permitted in this Lease; of if Tenant shall fail to occupy or
shall vacate the Leased Premises or shall fail to continuously operate its
business at the Leased Premises for the Permitted Use set forth herein, whether
or not Tenant is in monetary or other default under this Lease; or if Tenant
shall fail to execute any instrument of subordination or attornment or any
estoppel certificate within the time periods set forth in Sections 7.10 and 7.11
respectively following Landlord’s request for the same, then Landlord may
immediately or at any time thereafter and without demand or further notice make
entry and repossess the Leased Premises as of Landlord’s former estate, without
prejudice to any other remedies, and thereupon this Lease shall terminate; and
in case of such termination, or termination by legal proceedings for default,
Landlord may remove all of Tenant’s property from the Leased Premises and store
the same in any public warehouse or other suitable location all at the expense
and risk of Tenant, and Tenant shall indemnify Landlord during the remaining
period before this Lease would otherwise expire against all loss or damage
suffered by reason of the termination, the loss or damage, if any, for each
lease month to be paid at the end thereof, or as otherwise herein provided.

10.2 Reimbursement of Landlord’s Expenses. In the case of termination of this
Lease pursuant to Section 10.1, Tenant shall reimburse Landlord for all
reasonable expenses arising out of such termination, including without
limitation, all costs incurred in preparing the Plans and performing Landlord’s
Work, all costs incurred in collecting amounts due from Tenant under this Lease
(including reasonable attorneys’ fees, costs of litigation and the like); all
expenses incurred by Landlord in attempting to relet the Leased Premises or
parts thereof (including

 

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advertisements, brokerage commissions, Tenant’s allowances, lease inducements,
costs of preparing space, and the like); and all Landlord’s other reasonable
expenditures necessitated by the termination. The reimbursement from Tenant
shall be due and payable immediately from time to time upon notice from Landlord
that an expense has been incurred, without regard to whether the expense was
incurred before or after the termination.

10.3 Damages. Notwithstanding any other provisions hereof, Landlord may elect by
written notice to Tenant within four months following such termination to be
indemnified for loss of Rent by a lump sum payment representing the then present
value of the amount of Rent that would have been paid in accordance with this
Lease for the remainder of the Lease Term minus the then present value of the
aggregate fair market rent payable for the Leased Premises for the remainder of
the Lease Term (if less than the Rent payable hereunder), estimated as of the
date of the termination, and taking into account reasonable projections of
vacancy and time required to relet the Leased Premises. For the purposes of this
Section 10.3, the “remainder of the Lease Term” shall not include any Extension
Terms available to Tenant under Section 20 of this Lease except to the extent
that the extension option for any such Extension Term has already been exercised
by Tenant in accordance with the provisions of Section 20. (For the purposes of
calculating the Rent that would have been paid hereunder for the lump sum
payment calculation described herein, the last full year’s Additional Rent under
this Lease is to be deemed constant for each year thereafter. The Federal
Reserve discount rate (or equivalent) shall be used in calculating present
values.) Should the parties be unable to agree on a fair market rent, the matter
shall be submitted, upon the demand of either party, to the Boston,
Massachusetts office of the American Arbitration Association, with a request for
arbitration in accordance with the rules of the Association by a single
arbitrator who shall be an MAI appraiser with at least ten years experience as
an appraiser of suburban commercial real estate in the Eastern Massachusetts
area. The parties agree that a decision of the arbitrator shall be conclusive
and binding upon them. Should Landlord fail to make the election provided for in
this Section 10.3, Tenant shall indemnify Landlord for the loss of Rent by a
payment at the end of each month which would have been included in the Lease
Term, representing the difference between the Rent that would have been paid in
accordance with this Lease and the Rent actually derived from the Leased
Premises by Landlord for such month (the amount of Rent deemed derived shall be
the actual amount less any portion thereof attributable to Landlord’s reletting
expenses described in Section 10.2 that have not been reimbursed by Tenant
thereunder).

10.4 Mitigation. Landlord shall use commercially reasonable efforts to relet the
Leased Premises, which efforts shall be subject to the reasonable requirements
of Landlord to lease to high quality tenants and to develop the Building and the
Site in a harmonious manner with an appropriate mix of uses, tenants, floor
areas and terms of tenancies, and the like. It is agreed that hiring a reputable
leasing broker to lease the Premises. listing the premises at commercially
reasonable rates, and cooperating in good faith with such broker shall satisfy
the requirement that Landlord use commercially reasonable efforts to relet.

10.5 Claims in Bankruptcy. Nothing herein shall limit or prejudice the right of
Landlord to prove and obtain in a proceeding for bankruptcy, insolvency,
arrangement or reorganization, by reason of the termination, an amount equal to
the maximum allowed by the statute of law in effect at the time when, and
governing the proceedings in which, the damages are to be proved, whether or not
the amount is greater to, equal to, or less than the amount of the loss or
damage which Landlord has suffered.

 

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10.6 Late Charge. If any payment of Basic Rent, Additional Rent, or other
payment due from Tenant to Landlord is not paid when due, then Landlord may, at
its option, without notice and in addition to all other remedies hereunder,
impose a late charge on Tenant equal to 1.5% of the amount in question for each
month (prorated for any partial month) during which said delinquency continues,
provided that no late charge will be imposed for Basic Rent payments less than
ten days late, up to one time in any calendar year. Such late charge shall
constitute Additional Rent hereunder payable upon demand.

10.7 Landlord’s Right to Cure Defaults. Landlord may, but shall not be obligated
to cure, at any time any default by Tenant under this Lease. In curing such
defaults, Landlord may enter upon the Leased Premises upon prior notice to
Tenant and take such action thereon as may be necessary to effect such cure.
Notwithstanding the foregoing, in the case of an emergency threatening serious
injury to persons or property, Landlord may cure such default without prior
notice. All costs and expenses incurred by Landlord in curing a default,
including reasonable attorneys’ fees, together with interest thereon at the rate
of eighteen (18%) percent per annum from the day of payment by Landlord, shall
be paid by Tenant to Landlord on demand. Landlord may use the Security Deposit
to effectuate any such cure.

In the event an emergency threatening serious injury to persons or property
occurs and Tenant has made reasonable efforts to notify Landlord, Tenant may
cure such emergency on behalf of and at the expense of the Landlord (provided
such actions are Landlord’s responsibilities hereunder) and do all necessary
work and make all necessary payments in connection therewith. Landlord agrees to
pay Tenant any reasonable amount so paid on Landlord’s behalf within thirty
(30) days of receiving from Tenant such documentation as Landlord may reasonably
request to substantiate the amount for which Tenant is seeking reimbursement.

10.8 Effect of Waivers of Default. No consent or waiver, express or implied, by
Landlord to or of any covenant, condition or duty of Tenant shall be construed
as a consent or waiver by Landlord to or of any other breach of the same or any
other covenant, condition or duty.

ARTICLE 11—ASSIGNMENT AND SUBLETTING

11.1 Assignment of Lease by Tenant. Tenant shall not assign all or any portion
of or interest in the Lease without the prior written consent of Landlord. It is
agreed that in requesting such consent, Tenant shall provide such information
regarding the proposed assignee and the proposed assignment as Landlord may
reasonably request. Landlord’s consent to Tenant’s request shall not be
unreasonably withheld or delayed, in each instance, except under circumstances
where Tenant is in default beyond applicable grace periods of any covenant in
this Lease, in which event such consent may be withheld in Landlord’s absolute
discretion.

 

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11.2. Subletting by Tenant. Tenant shall not sublet the Leased Premises or any
portion thereof without Landlord’s prior written consent. It is agreed that in
requesting such consent Tenant shall provide such information regarding the
proposed sublease and the proposed sublease arrangement as Landlord may
reasonably request. Landlord’s consent to Tenant’s request shall not be
unreasonably withheld or delayed, in each instance, except under circumstances
where Tenant is in default beyond applicable grace periods of any covenant in
this Lease, in which event such consent may be withheld in Landlord’s absolute
discretion. In the event that such sublease is approved, at Landlord’s request,
Tenant shall construct a new demising wall separating such space from the
remainder of the Leased Premises.

11.3 If Landlord consents to such assignment or subletting, it is understood and
agreed that one-half of all profits realized by Tenant as a result of amounts
collected by the Tenant from such assignee or subtenant shall be paid to
Landlord by Tenant. For purposes of this Section 11.3, “profits” shall mean the
amount by which all compensation received by Tenant as a result of such
assignment or subletting, net of reasonable expenses actually incurred by Tenant
in connection with such assignment or subletting, including leasing commissions
amortized over the Term, in the case of an assignment, or over the term of the
sublease, in the case of a subletting, exceeds (b) the Basic Rent and Additional
Rent attributable to the entire Leased Premises, in the case of an assignment,
or attributable to the portion of the Leased Premises so sublet, in the case of
a subletting.

11.4 The consent by Landlord to any assignment, subletting or occupancy shall
not be construed as a waiver or release of Tenant from any and all liability for
the performance of all covenants and obligations to be performed by Tenant under
this Lease, nor shall the collection or acceptance of rent from any assignee,
transferee or subtenant constitute a waiver or release of Tenant from any of its
liabilities or obligations under this Lease. Landlord’s consent to any
assignment, subletting or occupancy shall not be construed as a consent with
respect to any subsequent assignment, subletting or occupancy. For any period
during which Tenant is in default with respect to the payment of Rent, Tenant
hereby assigns to Landlord the rent due from any subtenant of Tenant and hereby
authorizes each subtenant to pay said rent directly to Landlord.

11.5 Notwithstanding anything contained in Section 11.1 to the contrary, Tenant
may assign this Lease to any parent, subsidiary or affiliate of Tenant or any
corporation or other entity into which or with which Tenant is merged or
consolidated provided that the assignee has (and will continue to have after the
merger, acquisition or takeover as the case may be) a net worth computed in
accordance with generally accepted accounting principles consistently applied at
least equal to or greater than the net worth of Tenant immediately prior to such
merger, consolidation or transfer and, no less than sixty days prior to such
assignment, Tenant shall deliver to Landlord a statement of income and balance
sheet of the proposed assignee for the immediately preceding fiscal year and the
immediately preceding fiscal quarter certified by an independent certified
public accountant and prepared in accordance with generally accepted accounting
principles consistently applied evidencing such net worth.

 

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ARTICLE 12—NOTICES

All notices, consents, approvals, or other communication required by the
provisions of this Lease to be given to Landlord or Tenant shall be in writing
and shall be deemed properly delivered and received when (i) personally
delivered (ii) one business day after being placed in the possession of a
nationally recognized overnight courier service (such as Federal Express),
(iii) three business days after being deposited in the United States mail,
postage prepaid, certified or registered mail, return receipt requested, or
(iv) sent by facsimile providing a transmission receipt (and provided the
original notice shall be mailed by a nationally recognized overnight courier
service), addressed to the Original Address of the party or to such other
address as the party shall have last designated by notice. Notice shall be
deemed received on the date of receipt if such notice is sent by overnight
courier. Notwithstanding anything contained herein to the contrary, any notice
required under the provisions of Article 17 hereof may be addressed to and given
by the respective Construction Representatives of Landlord and Tenant and
delivered at the Property to the attention of such Construction Representatives.

ARTICLE 13—NOTICE OF LEASE

Each party hereto agrees, on the request of the other, to execute a notice of
lease in recordable form and complying with applicable law. In no event shall
such document set forth the rent or other charges payable by Tenant under this
Lease; and any such document shall expressly state that it is executed pursuant
to the provisions contained in this Lease, and is not intended to vary the terms
and conditions of this Lease. At Landlord’s request, promptly upon expiration of
or earlier termination of the Lease Term, Tenant shall execute and deliver to
Landlord a release of any document recorded in the real property records for the
location of the Property evidencing this Lease, and Tenant hereby appoints
Landlord Tenant’s attorney-in-fact, coupled with an interest, to execute any
such document if Tenant fails to respond to Landlord’s request to do so within
fifteen (15) days. The obligations of Tenant under this Article 13 shall survive
the expiration or any earlier termination of this Lease.

ARTICLE 14—APPLICABLE LAW, SEVERABILITY, CONSTRUCTION

This Lease shall be governed by and construed in accordance with the laws of
Massachusetts and, if any provisions of this Lease shall to any extent be
invalid, the remainder of this Lease, and the application of such provisions in
other circumstances, shall not be affected thereby. This Lease may be amended
only by an instrument in writing executed by Landlord and Tenant. The titles of
the several Articles and Sections contained herein are for convenience only and
shall not be considered in construing this Lease.

ARTICLE 15—SUCCESSORS AND ASSIGNS, ETC.

15.1 It is understood and agreed that the covenants and agreements of the
parties hereto shall run with the land and that no covenant or agreement of
Landlord, expressed or implied, shall be binding upon Landlord except in respect
of any breach or breaches thereof committed during Landlord’s seisin and
ownership of the Leased Premises. If Landlord acts as a Trustee or Trustees of a
trust in making this Lease only the estate for which Landlord acts shall be
bound hereby, neither any such Trustee executing this Lease as Landlord nor any
shareholder or beneficiary of such trust shall be personally liable for any of
the covenants or agreements of Landlord expressed herein or implied hereunder or
otherwise because of anything arising from or

 

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connected with the use and occupation of the Leased Premises by Tenant.
Reference in this Lease to “Landlord” or to “Tenant” and all expressions
referring thereto, shall mean the person or persons, natural or corporate, named
herein as Landlord or as Tenant, as the case may be, and the heirs, executors,
administrators, successors and assigns of such person or persons, and those
claiming by, through or under them or any of them, unless repugnant to the
context. If Tenant is a partnership or a firm of several persons, natural or
corporate, the obligations of each person executing this Lease as Tenant shall
be joint and several. Any person who signs this Lease for Tenant or for Landlord
in a representative capacity personally warrants and represents that he or she
is duly authorized to do so.

15.2 It is further understood and agreed that Tenant shall look solely to the
estate and property of the Landlord in the Leased Premises for the satisfaction
of Tenant’s remedies for the collection of a judgment (or other judicial
process) requiring the payment of money by the Landlord in the event of any
default or breach by Landlord with respect to any of the terms, covenants and
conditions of this Lease to be observed or performed by the Landlord and any
other obligations of Landlord created by or under this Lease, and no other
property or assets of the Landlord or of its partners, beneficiaries,
co-tenants, shareholders or principals (as the case may be) shall be subject to
levy, execution or other enforcement procedures for the satisfaction of Tenant’s
remedies.

ARTICLE 16—LANDLORD’S ACCESS

Landlord and its authorized agents, employees, subcontractors and
representatives shall have the right to enter the Leased Premises at any time
during emergencies (Landlord agrees to use reasonable efforts to notify Tenant
of any such emergency) and at all reasonable times with prior notice to Tenant
for any of the following purposes: (a) to determine whether the Leased Premises
are in good condition and whether Tenant is complying with its obligations under
this Lease; (b) to do any necessary maintenance and to make such repairs,
alterations, improvements or additions in or to the Leased Premises as Landlord
has the right or obligation to perform under this Lease, as Landlord may be
required to do or make by law, or as Landlord may from time to time deem
necessary or desirable; (c) to exhibit the Leased Premises to prospective
tenants during the last nine (9) months of the term of this Lease or during any
period while Tenant is in default under this Lease; and (d) to show the Leased
Premises to prospective lenders, brokers, agents, buyers or persons interested
in an exchange, at any time during the term of this Lease; provided, however, in
no event shall Landlord’s entry into the Leased Premises for any reason other
than an emergency unreasonably interfere with Tenant’s use of the Leased
Premises or disturb the normal operations of Tenant’s business

If, at any time during the last month of the Term of this Lease, Tenant shall
have removed all of Tenant’s property from all or any portion(s) of the Leased
Premises, Landlord may, with Tenant’s prior consent which consent shall not be
unreasonably withheld or delayed (except that no consent shall be required if
Tenant is in default under this Lease) immediately enter and alter, renovate and
decorate the same, and such acts shall have no effect upon Tenant’s remaining
obligations and covenants under this Lease.

 

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ARTICLE 17—CONDITION OF PREMISES

17.1 Landlord’s Work. Landlord is delivering the Leased Premises to Tenant in
“as is” condition except as set forth in this Article 17. Landlord shall perform
and complete the Landlord’s Work described in Exhibit C attached hereto (as the
same may be modified in accordance with Section 17.2). Landlord covenants and
represents that the Landlord’s Work shall be completed in a good and workmanlike
manner and in compliance with all applicable laws. Landlord shall pay all the
costs incurred by the Landlord in connection with the Landlord’s Work except
that Tenant shall pay all costs incurred in connection with any change order
requested by Tenant and agreed to by Landlord in accordance with Section 17.2,
and Tenant shall pay all costs for Tenant’s wiring and cabling of the Leased
Premises.

17.2 Plans and Specifications. Landlord shall prepare plans and specifications
for the Landlord’s Work (the “Plans”) and shall submit the Plans to Tenant for
its approval, such approval not to be unreasonably withheld or delayed. If
Tenant does not advise Landlord in writing of its disapproval of the Plans, and
a detailed explanation of the reasons therefore, within seven (7) business days
after Landlord’s delivery of the Plans to Tenant, the same shall be deemed
approved by Tenant in all respects. If Tenant shall desire any changes to the
Plans, Tenant shall so advise Landlord in writing and Landlord shall determine
whether such changes can be made in a reasonable and feasible manner. If
Landlord agrees to make such reasonable changes, Landlord shall revise the Plans
and resubmit the same to Tenant for its reasonable approval. If Tenant does not
advise Landlord in writing of its disapproval of the revised Plans, and a
detailed explanation of the reasons therefor, within seven (7) business days
after Landlord’s delivery of the revised Plans, the same shall be deemed
approved by Tenant in all respects. Any and all costs of reviewing any requested
changes, including without limitation architectural, engineering and
consultants’ costs, shall be paid to Landlord upon demand, and any and all costs
of making any changes to the Landlord’s Work which Tenant may request and which
Landlord may agree to shall be at Tenant’s sole cost and expense and, if
Landlord so requests, shall be paid to Landlord upon demand and before execution
of any change order.

17.3 Performance and Completion of Landlord’s Work. Upon issuance of all
governmental permits and approvals required for Landlord’s Work, Landlord shall
commence and diligently exercise all reasonable efforts to complete Landlord’s
Work. Tenant’s Construction Representative shall visit the Site at weekly
intervals, or such other intervals appropriate to the stage of construction, to
monitor the progress of Landlord’s Work, to inspect Landlord’s Work and to
determine if Landlord’s Work is being performed in a manner indicating that
Landlord’s Work, when completed, will be in accordance with the Plans.
Landlord’s Construction Representative shall provide Tenant’s Construction
Representative with reasonable advance notice of all scheduled job meetings at
the Site, which notice may be by telephone or email, and Tenant’s Construction
Representative’s attendance at all such meetings shall be mandatory. Tenant’s
Construction Representative shall provide written notice to Landlord’s
Construction Representative specifically describing any on-site observations
indicating defects or deficiencies in Landlord’s Work (a “Claim”) immediately
upon discovery, which in any event shall be no later than 3 business days after
performance of that portion of Landlord’s Work that is the subject of such
Claim. Except for latent defects that could not be reasonably discovered by
Tenant’s Construction Representative during the inspections described in this
Section 17.3 and

 

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de minimis “punch list” items as described below, if Tenant’s Construction
Representative fails to provide written notice to Landlord’s Construction
Representative of a Claim within such 3 business day period after performance of
that portion of Landlord’s Work that is the subject of such Claim, such Claim
shall be deemed irrevocably waived by Tenant. Landlord’s Construction
Representative shall review Claims and take one or more of the following
preliminary actions within 3 business days of receipt of a Claim: (1) request
additional supporting data from Tenant’s Construction Representative, (2) submit
a schedule to the parties indicating when Landlord’s Construction Representative
expects to take action, (3) reject the Claim in whole or in part, stating
reasons for rejection, (4) recommend approval of the Claim by Landlord or
(5) suggest a compromise. If a Claim has been resolved, Landlord’s Construction
Representative will prepare written documentation evidencing such resolution
which shall be executed by both Landlord and Tenant. If a Claim has not been
resolved, Tenant’s Construction Representative shall, within ten days after
Landlord’s Construction Representative’s preliminary response, take one or more
of the following actions: (1) submit additional supporting data requested by
Landlord’s Construction Representative, (2) modify the initial Claim or
(3) notify Landlord’s Construction Representative that the initial Claim stands,
in which case if the parties are unable to resolve the Claim the dispute
resolution procedure set forth in Section 17.6 below may be employed.

Landlord’s Work shall be deemed to have been substantially completed on the
first day as of which (i) Landlord’s Work has been completed in accordance with
Exhibit C hereto except for items of work (and, if applicable, adjustment of
equipment and fixtures) which can be completed without causing undue
interference with Tenant’s preparation for its occupancy of the Leased Premises
(i.e. so called “punch list” items), Landlord’s architect has so certified and
Tenant has been given notice thereof; and (ii) the Town of Shrewsbury has issued
a temporary or final certificate of occupancy for the Building and a copy of
such certificate has been delivered to Tenant. Such date is hereinafter called
the “Substantial Completion Date.” Landlord’s Work shall be deemed to have been
fully completed on the first day as of which Landlord’s Work, including Tenant’s
Punch List (as hereinafter defined), has been fully completed, Landlord’s
architect has so certified and Tenant has been given notice thereof, and the
Town of Shrewsbury has issued a final certificate of occupancy. Such date is
hereinafter called the “Final Completion Date.” All work required to convert a
temporary certificate of occupancy to a final certificate of occupancy shall be
completed within sixty (60) days of the issuance of the temporary certificate,
or if such work is not susceptible of being completed within such sixty (60) day
period, for example as in the case of work requiring delivery of long lead-time
items or work that must be delayed due to winter or other weather conditions,
within a commercially reasonable time after issuance of the temporary
certificate.

Within ten (10) days following the Substantial Completion Date, Tenant shall
inspect the Premises. Tenant shall have ten (10) days from the Substantial
Completion Date to deliver to Landlord an itemized good faith punch list of work
not done, not completed or in need of repair (“Tenant’s Punch List”). Any item
not on Tenant’s Punch List which could reasonably have been discovered during
Tenant’s Punch List inspection of the Premises shall be deemed irrevocably
waived by Tenant. Landlord agrees that, upon receipt of Tenant’s Punch List, it
shall diligently and in good faith, at its sole cost and expense and as
expeditiously as practical (but in accordance with good construction practice)
complete all appropriate Punch List repairs. With

 

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regard to those latent defects which could not be reasonably discovered during
the Punch List inspection (or could not have been discovered at any prior
inspection performed by Tenant, Tenant’s Construction Representative, Tenant’s
architect or any other consultant, employee or agent of Tenant) Tenant shall
have one year from the Substantial Completion Date to request that such defects
be corrected by Landlord at its expense. Any construction defect noted more than
one year from the Substantial Completion Date shall be solely Tenant’s
responsibility. Landlord shall assign to Tenant any and all warranties of
Landlord’s Work which Landlord may receive from third parties to the extent that
such warranties are assignable. Upon completion of those items not completed as
of the Substantial Completion Date, including, without limitation, all
appropriate items specified on Tenant’s Punch List, Landlord shall submit to
Tenant a written notice of the final completion of Landlord’s Work. Tenant shall
afford Landlord access to the Premises for the purpose of completing Tenant’s
Punch List.

17.4 Landlord’s Performance. Tenant shall give Landlord notice, not later than
ten (10) days after the Final Completion Date, of any respects in which Landlord
has not performed Landlord’s Work fully, properly and in accordance with the
terms of this Lease. Except as identified in any such notice from Tenant to
Landlord, and except as otherwise set forth in Section 17.3 above, Tenant shall
have no right to make any claim that Landlord has failed to perform any of
Landlord’s Work fully, properly and in accordance with the terms of this Lease
or to require Landlord to perform any further Landlord’s Work. Except for
Landlord’s Work, the Leased Premises are being leased in their present
condition, AS IS, WITHOUT REPRESENTATION OR WARRANTY by Landlord. Tenant
acknowledges that it has inspected the Premises and, except for Landlord’s Work,
has found the same satisfactory.

17.5 Tenant’s Delay.

(a) A “Tenant Delay” shall mean an actual delay in the occurrence of the
Substantial Completion Date or the Final Completion Date with respect to
Landlord’s Work as the result of:

(1) any unreasonable delay by Tenant in approving the Plans;

(2) any request by Tenant that Landlord delay the commencement or completion of
Landlord’s Work for any reason;

(3) any request by Tenant to change the Plans after initial approval thereof by
Tenant, or the making of any changes to Landlord’s Work requested by Tenant and
agreed to by Landlord after initial approval of the Plans by Tenant;

(4) any failure by Tenant to respond in writing within seven (7) business days
after any written request by Landlord for clarification or interpretation of the
Plans or for approval of changes in the Plans deemed necessary by Landlord; or

(5) any other act or omission of Tenant or its officers, agents, employees or
contractors;

 

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Notwithstanding the foregoing, no event shall be deemed to be a Tenant Delay
until and unless Landlord has given Tenant written notice (the “Tenant Delay
Notice”) advising Tenant (i) that a Tenant Delay is occurring, (ii) of the basis
on which Landlord has determined that a Tenant Delay is occurring, and (iii) the
actions which Landlord believes that Tenant must take to eliminate such Tenant
Delay, and Tenant has failed to correct the Tenant Delay specified in the Tenant
Delay Notice within forty-eight (48) hours following receipt thereof. No period
of time prior to expiration of such 48-hour period shall be included in the
period of time charged to Tenant pursuant to such Tenant Delay Notice if Tenant
corrects the Tenant Delay specified in the Tenant Delay Notice within such
48-hour period.

(b) If a delay in the Substantial Completion Date or the Final Completion Date,
or if any substantial portion of such delay, is the result of Force Majeure, and
such Force Majeure delay would not have occurred but for a delay described in
Section 17.5(a), such Force Majeure delay shall be added to the delay described
in Section 17.5(a) and shall constitute a Tenant Delay.

17.6 Arbitration. All disputes arising under this Article 17 including, without
limitation, any dispute regarding the Term Commencement Date (a “Construction
Dispute”), shall be resolved by the arbitration procedure set forth below. In
the event of a Construction Dispute, Tenant agrees to perform all of its
obligations and pay any amounts due, in each case as determined by Landlord, on
or before the dates specified in this Lease, until such time as the Construction
Dispute is resolved by arbitration in accordance with this Section 17.6. At any
time from the date hereof until the Substantial Completion Date (and during the
period from the Substantial Completion Date until twelve (12) months thereafter
with respect to latent defects as set forth in Section 17.3) (the “Arbitration
Period”), either Landlord or Tenant may request any Construction Dispute be
submitted to arbitration in accordance with this Section 17.6 by giving a Notice
of Dispute (as defined below) to the other party. Failure of Landlord or Tenant
to give a Notice of Dispute during the Arbitration Period shall be a waiver by
Landlord or Tenant of any claim arising from such dispute. All Construction
Disputes shall be submitted to arbitration within three (3) business days after
either party receives, during the Arbitration Period, notice from the other that
a dispute or disagreement exists and requesting that the dispute be submitted to
arbitration (the “Notice of Dispute”).

The arbitrators shall be reputable contractors of office, laboratory and
research and development buildings having at least ten (10) years’ experience in
construction matters in the greater Boston, Massachusetts area, and who have not
worked for or on behalf of Landlord or Tenant within the preceding five years.
Landlord and Tenant shall each designate an arbitrator within ten (10) days
after the receipt of the Notice of Dispute. If either party fails to do so on or
before such date, time being of the essence, the arbitrator designated by the
other party shall be the sole arbitrator. If each party timely designates an
arbitrator, such arbitrators shall within ten (10) days select a third
arbitrator. In the event that the parties are unable to agree, for any reason,
on the choice of the third arbitrator within such ten (10) day period, Landlord
shall request the American Arbitration Association for Worcester County,
Massachusetts to designate a contractor as set forth above to act as the third
arbitrator and such choice shall be deemed consented to by all parties.

 

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The arbitrators shall conduct the arbitration under the expedited rules of the
American Arbitration Association then obtaining. The arbitrators shall award
costs (including professional fees) to the prevailing party. Further, the
arbitrators shall determine whether delays attributable to the matter submitted
to arbitration have delayed completion of Landlord’s Work and shall apportion or
allocate any such delay to the responsible party or parties.

The determination of the arbitrators shall be conclusive and binding upon the
parties and judgment upon any award may be entered in any court having
jurisdiction over the subject matter of the controversy.

ARTICLE 18—WARRANTY REGARDING BROKERS

Tenant warrants and represents that Tenant has dealt with no broker in
connection with the consummation of this Lease other than Broker, and, in the
event of any brokerage claims against Landlord predicated upon prior dealings
with Tenant, Tenant agrees to defend the same and indemnify Landlord against any
such claim (except any claim by Broker). Landlord warrants and represents that
Landlord has dealt with no Broker in connection with the consummation of this
Lease other than Broker, and, in the event of any brokerage claims against
Tenant predicated upon prior dealings with Landlord, Landlord agrees to defend
the same and indemnify Tenant against any such claim Landlord shall pay the
commission due the Broker identified in Section 1.1 of the Lease pursuant to a
separate agreement entered into by Landlord with the Broker.

ARTICLE 19—HAZARDOUS MATERIALS

19.1 Tenant shall not (either with or without negligence) cause or permit the
escape, disposal, release or threat of release of any biologically or chemically
active or other Hazardous Materials (as said term is hereafter defined) on, in,
upon or under the Leased Premises of the Site. Tenant shall not allow the
generation, storage, use or disposal of such Hazardous Materials in any manner
not sanctioned by law or by the highest standards prevailing in the industry for
the generation, storage, use and disposal of such Hazardous Materials, nor allow
to be brought into the Leased Premises or the Site any such Hazardous Materials
except for use in the ordinary course of Tenant’s business, and then only after
written notice is given to Landlord of the identity of such Hazardous Materials.
Hazardous Materials shall include, without limitation, any material or substance
which is (i) petroleum, (ii) asbestos, (iii) designated as a “hazardous
substance” pursuant to Section 311 of the Federal Water Pollution Control Act,
33 U.S.C. §1251 et seq. (33 U.S.C. §1321) or listed pursuant to §307 of the
Federal Water Pollution Control Act (33 U.S.C. §1317), (iv) defined as a
“hazardous waste” pursuant to Section 1004 of the Resource Conservation and
Recover Act, 42 U.S.C. 6901 et seq. (42 U.S.C. §6903), (v) defined as a
“hazardous substance” pursuant to Section 101 of the Comprehensive Environmental
Response, Compensation, and Liability Act, 42 U.S.C. §9601 et seq. (42 U.S.C.
§9601), as amended, or (vi) defined as “oil” or a “hazardous waste”, a
“hazardous substance”, a “hazardous material” or a “toxic material” under any
other law, rule or regulation applicable to the Property, including, without
limitation, Chapter 21E of the Massachusetts General Laws, as amended. If any
lender or governmental agency shall ever require testing to ascertain whether or
not there has been any release of Hazardous Materials, then the reasonable costs
thereof shall be reimbursed by Tenant to Landlord upon demand as additional
charges but only if such requirement applies to the Leased Premises or may be
the result of the acts or omissions of Tenant. In addition, Tenant shall

 

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execute affidavits, representations and the like, from time to time, at
Landlord’s request concerning Tenant’s best knowledge and belief regarding the
presence of Hazardous Materials in the Leased Premises or the Site. In all
events, Tenant shall indemnify and save Landlord harmless from any release on
threat of release on the presence or existence of Hazardous Materials in the
Leased Premises occurring while Tenant is in possession, or elsewhere on the
Site if caused by Tenant or persons acting under Tenant. The within covenants
and indemnity shall survive the expiration or earlier termination of the Term of
this Lease. Landlord expressly reserves the right to enter the Leased Premises
to perform regular inspections.

19.2 Notwithstanding anything herein to the contrary, Tenant shall not be
responsible for the costs and expenses incurred in connection with the removal
or remediation of Hazardous Material that is not in compliance with applicable
law on the Term Commencement Date and which is located in, on or under the
Building or the Property prior to the Term Commencement and was not brought on
to the Property by Tenant.

19.3 Landlord warrants and represents that there are currently no Hazardous
Materials in the Leased Premises.

ARTICLE 20—EXTENSION TERMS

Provided the Lease is then in full force and effect and further provided that
Tenant is not then in default under any of the terms, covenants or conditions of
the Lease on Tenant’s part to be observed or performed, Tenant shall have two
(2) successive options to extend this Lease and the Lease Term for an extended
term of five (5) years per option (the “Extension Terms”); each such option to
be exercisable only by written notice given by Tenant to Landlord at least nine
(9) months prior to the expiration of the Lease Term then in effect. If Tenant
exercises such options in accordance with the provisions and limitations of this
Article, this Lease and the Lease Term shall be extended for five (5) years
(unless sooner terminated pursuant to the terms of this Lease) commencing on the
date following the last day of the Lease Term in effect prior to such option
being exercised, upon all of the then applicable terms, covenants and conditions
contained in this Lease, including payment of Basic Rent in the amounts set
forth in Section 1.1, it being understood that such Basic Rent shall be payable
in equal monthly installments, in advance, just as in the case of the Original
Lease Term.

Time is of the essence with respect to the exercise of the options contained
herein. Tenant shall not have the right to give any notice exercising such
options after the expiration of the applicable time limitation set forth herein,
and any notice given after such time limitation purporting to exercise such
option shall be void and of no force or effect.

ARTICLE 21—FORCE MAJEURE

In the event that Landlord or Tenant shall be delayed, hindered in or prevented
from the performance of any act required hereunder by reason of Force Majeure,
then performance of such act shall be excused for the period of the delay and
the period for the performance of any such act shall be extended for a period
equivalent to the period of such delay.

 

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ARTICLE 22—HOLDOVER CLAUSE

In the event Tenant fails to vacate the Leased Premises by the end of the Lease
Term or the extension term, Tenant hereby agrees to pay Landlord two hundred
percent (200%) of the then applicable monthly installment of Rent. The “Holdover
Rental Rate” shall be paid monthly in advance to Landlord. In determining the
“Holdover Rental Rate” Landlord shall use two hundred percent (200%) percent of
the Basic Rent and all Additional Rent payable for the last full calendar month
under the Lease. In addition to the “Holdover Rental Rate”, Landlord shall be
entitled to seek to recover full damages sustained as a result of said holdover.

ARTICLE 23—MISCELLANEOUS

23.1 This Lease may be executed in several counterparts, all of which constitute
one and the same instrument.

23.2 If any provision of this Lease, or its application to any situation, shall
be invalid or unenforceable to any extent, the remainder of this Lease, or the
application thereof to situations other than as to which it is invalid or
unenforceable, shall not be affected thereby, and every provision of this Lease
shall be valid and enforceable to the fullest extent permitted by law.

23.3 This Lease constitutes the entire agreement between the parties concerning
the Leased Premises, and may be amended only by written agreement of the
parties. No representations, inducements, promises or agreements, oral or
otherwise, concerning the Leased Premises between Landlord and Tenant or any of
their respective brokers, employees or agents, not embodied herein, shall be of
any force or effect.

23.4 Time is of the essence of every provision of this Lease.

23.5 There are no third party beneficiaries of this Lease, either express or
implied.

23.6 This Lease shall create only the relationship of landlord and tenant
between Landlord and Tenant and no estate shall pass out of Landlord. Nothing
herein is intended to be construed as creating a joint venture or partnership
relationship between the parties hereto, or a relationship of principal and
agent or employer and employee.

23.7 LANDLORD AND TENANT KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ALL
RIGHTS TO TRIAL BY JURY IN ANY DISPUTE ARISING IN CONNECTION WITH THIS LEASE.

[End of page. Signature page follows.]

 

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EXECUTED as an instrument under seal as of this              day of December,
2006.

 

LANDLORD:    TENANT:

The Taming Of The Shrewsbury, LLC,

O’Neill Partners, LLC and Chanski, LLC,

as tenants in common

   Valeritas, LLC    By:                                     
                                                      By: The Taming Of The
Shrewsbury, LLC,    Name:                                     
                                               

as TIC Manager

   Title:                                     
                                                 

 

  By:     _________________________________             Vincent G. O’Neill,
Manager

 

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EXHIBIT A

FLOOR PLAN OF LEASED PREMISES

(see attached)

 

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LOGO [g180550page480.jpg]

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EXHIBIT B

LEGAL DESCRIPTION OF SITE

That certain parcel of land situate in Shrewsbury in the County of Worcester and
said Commonwealth, bounded and described as follows:

 

NORTHWESTERLY    by the southeasterly line of Boston-Worcester Turnpike, three
hundred twenty-six and 61/100 (326.61) feet; NORTHEASTERLY    by land and now or
formerly of Carmine Zamarro, et al, seven hundred twenty-three and 36/100
(723.36) feet; SOUTHEASTERLY    by land now or formerly of Raymond Fuller, three
hundred seventy-nine and 22/100 (379.22) feet; SOUTHWESTERLY    by the
northeasterly line of Chestnut Street, three hundred ninety-two and 3/100
(392.03) feet; NORTHWESTERLY    seventy-five (75) feet; SOUTHWESTERLY    four
hundred twenty-two and 70/100 (422.70) feet by land now or formerly of Richard
N. Shaw, et al.

All of said boundaries are determined by the Court to be located as shown upon
Plan No. 26130-A, which is filed with original Certificate of Title No. 5153,
the same being compiled from a plan drawn by Schofield Brothers, Civil
Engineers, dated September 1, 1955, and additional data on filed in the Land
Registration Office, all as modified and approved by the Court.

 

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EXHIBIT C

LANDLORD’S WORK

 

  •   All base building systems serving the Leased Premises shall be in good
working order.

 

  •   Landscaping improvements shall include installation of an in-ground
sprinkler system.

 

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EXHIBIT D

TERM COMMENCEMENT DATE LETTER

                    , 2006

[Name of Contact]

[Name of Tenant]

[Address of Tenant]

 

RE: [Address of Premises]

Dear [Name of Contact]:

Reference is hereby made to that certain Lease, dated as of
                    , 2006, between [Landlord], as Landlord and [Tenant], as
Tenant, with respect to the above-referenced Premises. In accordance with the
Lease, this is to confirm that the Term Commencement Date under the Lease
occurred on                     .

If the foregoing is in accordance with your understanding, kindly execute the
enclosed duplicate of this letter, and return the same to us.

 

Very truly yours, [Landlord] By:                                     
                                 Name:                                     
                             Title:                                     
                               Accepted and Agreed: [Tenant]
By:                                                                      
Name:                                                                  
Title:                                                                    
Date:                                                                    

 

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EXECUTED as an instrument under seal as of this 22nd day of December, 2006.

 

LANDLORD:    TENANT:

The Taming Of The Shrewsbury, LLC,

O’Neill Partners, LLC and Chanski, LLC,

as tenants in common

   Valeritas, LLC

By: The Taming Of The Shrewsbury, LLC,

as TIC Manager

  

By: /s/ Robert R. Gonnelli                                    

Name: Robert R. Gonnelli                                

Title: President of CEO                          

 

  By:    /s/ Vincent G. O’Neill                         Vincent G. O’Neill,
Manager

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FIRST AMENDMENT TO LEASE

This First Amendment to Lease (“Amendment”) is made as of this 24 day of April,
2009 by and between The Taming Of The Shrewsbury, LLC, a Massachusetts limited
liability company, O’Neill Partners, LLC, a Hawaii limited liability company,
and Chanski, LLC, a Florida limited liability company, as tenants in common, as
Landlord, and Valeritas, LLC, as Tenant.

WHEREAS, Landlord and Tenant are parties to that certain lease dated as of
December 22, 2006 (the “Lease”) with respect to certain premises comprising of
46,350 rentable square footage (the “Leased Premises”) in the building located
at 800 Boston Turnpike, Shrewsbury, Massachusetts (the “Building”); and

WHEREAS, Landlord and Tenant now desire to amend the Lease to reflect the
additional space to be included in the Leased Premises and to otherwise modify
the Lease as set forth in this Amendment.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged by the parties hereto,
Landlord and Tenant hereby amend the Lease as follows:

1. Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Lease.

2. Landlord hereby leases to Tenant and Tenant hereby accepts the additional
space consisting of a total of 26,458 rentable square feet in the Building, as
shown on Exhibit A attached hereto (the “Additional Space”), 13,858 rentable
square feet of which shall be incorporated into the Leased Premises effective as
of June 1, 2009, and 12,600 rentable square feet of which shall be incorporated
into the Leased Premises effective as of June 1, 2010.

3. Landlord shall deliver the Additional Space to Tenant upon completion of
Landlord’s Additional Space Work (as defined below) and shall provide heat and
all other services currently provided to the Leased Premises by Landlord to the
Additional Space (but not cooling unless Tenant intends to include air
conditioning as part of Landlord’s Additional Space Work), otherwise the
Additional Space shall be delivered to Tenant in its “as-is” condition. For the
purposes of this Section 3 of this Amendment, Landlord’s Additional Space Work
shall include: (i) the erection of demising walls and /or connecting doors
between the Leased Premises and the Additional Premises (or within the
Additional Space) as directed by Tenant prior to June 1, 2009, and
(ii) installation of new fixtures, to include new cabinetry, toilets, mirror,
sink, faucet and tile floor, in the existing bathroom in the Additional Space
(which improvements and fixtures shall be approved by Tenant in advance in
Tenant’s reasonable discretion) and to deliver the bathroom in good order,
repair and condition. Landlord’s Additional Space Work shall be governed by

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Section 17 of the Lease as if it were a part of Landlord’s Work under the Lease
(including, but not limited to, the preparation of plans, issuance of permits
and completion of the work in a good and workmanlike manner); provided, however,
the cost of Landlord’s Additional Space “Work shall be paid by Tenant in the
following manner upon completion and receipt of evidence of documented
reasonable actual costs incurred by Landlord: at Tenant’s option, (i) in a lump
sum by Tenant to Landlord within 60 days after Tenant’s receipt of such
evidence, or (ii) amortized over the Original Lease Term at an interest rate of
8% per year. If Tenant opts to amortize such costs, Landlord and Tenant shall
enter into an amendment to the Lease to adjust the Basic Rent schedule for the
Additional Space to include such amortized costs. If Landlord fails to complete
Landlord’s Work prior to June 1, 2009, Tenant shall have the right, but not the
responsibility, to complete Landlord’s Work without further consent or
permission from Landlord, at Landlord’s expense, provided, however, that the
cost of Landlord’s Additional Space Work shall be reimbursed by Tenant in the
manner set forth above. Landlord shall be solely and exclusively responsible for
all heating costs to heat the Additional Space incurred by Landlord or Tenant as
a result of the lack of such walls and/or doors until completion of Landlord’s
Additional Space Work. Tenant’s obligation to pay Basic Rent for the Additional
Space shall commence and be conditioned upon the completion of Landlord’s
Additional Space Work, which shall be determined by Tenant in Tenant’s
commercially reasonable discretion.

4. Commencing on June 1, 2009 and continuing until May 31, 2010, Tenant shall
pay to Landlord (i) Annual Basic Rent for 3,833 rentable square feet of the
initial 13,858 rentable square feet of Additional Space in the amount of Twenty
Thousand One Hundred Twenty-Three and 25/100 Dollars ($20,123.25) and
(ii) Annual Basic Rent for the remaining 10,025 rentable square feet of the
initial 13,858 rentable square feet of Additional Space in the amount of Forty
Thousand One Hundred Dollars ($40,100.00), so that the aggregate Annual Basic
Rent for the initial 13,858 rentable square feet of Additional Space as of
June 1, 2009 shall be Sixty Thousand Two Hundred Twenty-Three and 25/100 Dollars
($60,223.25), payable in equal monthly installments of Five Thousand Eighteen
and 60/100 Dollars ($5,018.60), which payments shall be in addition to the
Monthly Basic Rent payable in accordance with the Basic Rent schedule set forth
in Section 1.1 of the Lease

5. Commencing on June 1, 2010, the Tenant shall pay to the Landlord Basic Rent
for the entire 26,458 rentable square feet of Additional Space in accordance
with the schedule below, which payments shall be in addition to the Basic Rent
payable in accordance with the Basic Rent schedule set forth in Section 1.1 of
the Lease.

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Basic Rent for Additional Space:

 

Period

   Annual Basic
Rent      Monthly
Basic Rent  

June 1, 2010 to May 31, 2011

   $ 138,904.50       $ 11,575.38   

June 1, 2011 to May 31, 2012

   $ 145,519.00       $ 12,126.58   

June 1, 2012 to May 31, 2013

   $ 152,133.50       $ 12,677.79   

June 1, 2013 to May 31, 2014

   $ 158,748.00       $ 13,229.00   

June 1, 2014 to May 31, 2015

   $ 165,362.50       $ 13,780.21   

June 1, 2015 to May 31, 2016

   $ 171,977.00       $ 14,331.42   

June 1, 2016 to May 31, 2017

   $ 178,591.50       $ 14,882.63   

June 1, 2017 to October 31, 2017

   $ 185,206.00       $ 15,433.83   

First Extension Term (if applicable)

     

November 1, 2017 to May 31, 2018

   $ 185,206.00       $ 15,433.83   

June 1, 2018 to May 31, 2019

   $ 191,820.50       $ 15,985.04   

June 1, 2019 to May 31, 2020

   $ 198,435.00       $ 16,536.25   

June 1, 2020 to May 31, 2021

   $ 205,049.50       $ 17,087.46   

June 1, 2021 to May 31, 2022

   $ 211,664.00       $ 17,638.67   

June 1, 2022 to October 31, 2022

   $ 218,278.50       $ 18,189.88   

Second Extension Term (if applicable)

     

November 1, 2022 to May 31, 2023

   $ 218,278.50       $ 18,189.88   

June 1, 2023 to May 31, 2024

   $ 224,893.00       $ 18,741.08   

June 1, 2024 to May 31, 2025

   $ 231,507.50       $ 19,292.29   

June 1, 2025 to May 31, 2026

   $ 238,122.00       $ 19,843.50   

June 1, 2026 to May 31, 2027

   $ 244,736.50       $ 20,394.71   

June 1, 2027 to October 31, 2027

   $ 251,351.00       $ 20,945.92   

6. The Right of First Refusal set forth in Section 1.1 of the Lease is hereby
deleted in its entirety and replaced with the following:

“Tenant shall have a Right of First Refusal to lease any of the remaining 7,192
square feet of space in the Building on an “as-is” basis (provided the space is
to be delivered to Tenant in broom clean condition and free and clear of all
tenancies). If at any time during the Lease Term, Landlord intends to enter into
a proposed lease (a “Proposed Lease”) for all or any portion of the remaining
7,192 square feet of space in the Building with anyone (a “Proposed Tenant”),
Landlord shall first offer to Tenant the right to add to the Leased Premises the
entire space set forth in the Proposed Lease upon the following terms and
conditions:

A. Landlord shall notify Tenant of its intention to enter into such a Proposed
Lease. Such notice shall be in writing (the “Offer Notice”) and shall provide
Tenant with specific information concerning the amount of square footage of
space which Landlord intends to lease, the term, as well as the specific
location of such space (the “Offered Space”). In order to send the Offer Notice,
Landlord does not need to have negotiated a lease with the Proposed Tenant but
must have either a signed letter of intent or a signed term sheet from the
Proposed Tenant.

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B. If Tenant, within fourteen (14) days after receipt of Landlord’s Offer
Notice, indicates in writing its unconditional agreement to exercise its rights
under this Lease to lease the entire Offered Space (“Tenant’s Notice”) in its
“as-is” condition (provided the space is to be delivered to Tenant in broom
clean condition and free and clear of all tenancies), the Offered Space shall be
included within the Leased Premises and leased to Tenant pursuant to the
provisions of this Lease (including making the Offered Space term be coterminous
with the Lease Term under the Lease), including, without limitation, the
provisions relating to the rights and obligations of the parties with respect to
alterations. However, (i) the Basic Rent payable under this Lease shall be
increased by the amount of rent attributable to the Offered Space at the same
rental rate per square foot NNN as the rental rate per square foot NNN reflected
in the Basic Rent for Additional Space schedule set forth above in this
Amendment, and (ii) Tenant shall pay Additional Rent for Impositions and
Operating Expenses based on Tenant’s Proportionate Share of the Building as
adjusted to reflect the increase in the rentable square footage of space in the
Leased Premises. Landlord shall provide heat to the Offered Space and all other
services currently provided to the Leased Premises by Landlord, otherwise the
Offered Space shall be delivered to Tenant in its “as-is” condition (provided
the space is to be delivered to Tenant in broom clean condition and free and
clear of all tenancies) and except for any improvements or demising walls
requested by Tenant, the cost of which shall be treated the same as Landlord’s
Additional Space Work in Section 3 of this Amendment. Time shall be of the
essence with respect to the giving of the Offer Notice and Tenant’s Notice.
Tenant must accept the entire Offered Space and may not exercise its right with
respect to less than the Offered Space.

The parties shall immediately execute an amendment to this Lease stating the
addition of the Offered Space to the Leased Premises. If Tenant fails to provide
Landlord with Tenant’s Notice within the fourteen (14) day period described
above, Landlord thereafter shall have the right to lease the Offered Space to
the Proposed Tenant on the same terms and conditions offered to Tenant (and if
Landlord modifies those terms and conditions in any way, Landlord must first
send Tenant a new Offer Notice and Tenant shall have all of the same rights set
forth above for the first Offer Notice with respect to the new Offer Notice),
provided, however, that in any case Tenant shall have the non-exclusive right to
use the third loading dock serving the Building in common with any other tenant
or tenants leasing all or any of the remaining 7,192 square feet of space in the
Building. The provisions of this section shall be operative each time any lease
for any portion of the remaining space in the Building shall expire and Landlord
intends to enter into a Proposed Lease for such space with a Proposed Tenant.

7. The definition of “Leased Premises” set forth in Section 1.1 of the Lease is
hereby deleted and replaced in its entirety with the following:

“Leased Premises: As of June 1, 2009, 60,208 rentable square feet of space in
the Building as shown on Exhibit A attached hereto; and as of June 1, 2010,
72,808 rentable square feet of space in the Building as shown on Exhibit A
attached hereto.”

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8. The definition of “Tenant’s Proportionate Share of the Building” set forth in
Section 1.1 of the Lease is hereby deleted and replaced in its entirety with the
following:

“Tenant’s Proportionate Share of the Building: 75.26% as of June 1, 2009; and
91.01% as of June 1, 2010”

9. Exhibit A to the Lease is hereby deleted and replaced in its entirety with
the new Exhibit A attached hereto.

10. Except as specifically stated herein, the Tenant’s use and occupancy of the
Leased Premises, including the Additional Space, shall otherwise continue upon
all of the same terms and conditions set forth in the Lease.

11. Except as amended hereby, the Lease remains in full force and effect and is
hereby ratified and affirmed.

12. Tenant warrants and represents that Tenant has dealt with no broker in
connection with the consummation of this Amendment, and, in the event of any
brokerage claims against Landlord predicated upon prior dealings with Tenant in
connection with this Amendment, Tenant agrees to defend the same and indemnify
Landlord against any such claim. Landlord warrants and represents that Landlord
has dealt with no Broker in connection with the consummation of this Amendment
other than Broker, and, in the event of any brokerage claims against Tenant
predicated upon prior dealings with Landlord in connection with this Amendment,
Landlord agrees to defend the same and indemnify Tenant against any such claim

13. The definition of Address of Tenant after Term Commencement Date (which
should be the address used for all notices under the Lease) is hereby deleted
and replaced in its entirety with the following:

Valeritas, Inc.

9 Campus Drive, 2nd Floor East

Parsippany, NJ 07054

Attention: Ernie Toth, Chief Financial Officer

IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment as of
the day and year first above written.

 

LANDLORD:     TENANT: The Taming Of The Shrewsbury, LLC, O’Neill Partners, LLC
and Chanski, LLC, as tenants in common     Valeritas, LLC       By:   /s/
Geoffrey H Jenkins By:   The Taming Of The Shrewsbury, LLC, as TIC Manager    
Name:   Geoffrey H Jenkins       Title:   EVP By:             Vincent G.
O’Neill, Manager      

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EXHIBIT A

FLOOR PLAN OF LEASED PREMISES

(see attached)