THIRD AMENDMENT TO LEASE

THIS THIRD AMENDMENT TO LEASE (this "Third Amendment") is made as of _________
2011, by and between ARE-819/863 MITTEN ROAD, LLC, a Delaware limited liability
company ("Landlord"), and JUVARIS BIOTHERAPEUTICS, INC., a Delaware corporation
("Tenant").

RECITALS

A.          Landlord and Tenant entered into that certain Lease Agreement dated
as of February 15, 2007, as amended by that certain First Amendment to Lease
dated as of February 29,2008 and as further amended by that certain Second
Amendment to Lease dated as of September 18, 2008 (as amended, the "Lease").
Pursuant to the Lease, Tenant leases certain premises consisting of
approximately 22,258 rentable square feet ("Premises") in a building located at
866 Malcolm Road, Burlingame, California 94010. The Premises are more
particularly described in the Lease. Capitalized terms used herein without
definition shall have the meanings defined for such terms in the Lease.

B.          Landlord and Tenant desire to, subject to the terms and conditions
set forth herein, among other things, amend the Lease to reflect the surrender
of that portion of the Premises consisting of approximately 10,834 rentable
square feet, as more particularly described on Exhibit a attached to this First
Amendment ("Surrender Premises") as of the date of this Third Amendment
("Surrender Date").

NOW, THEREFORE, in consideration of the foregoing Recitals, which are
incorporated herein by this reference, the mutual promises and conditions
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant hereby agree
as follows:

2.                    Building. As of the Surrender Date, the definition of
"Building" on Page 1 of the Lease is hereby amended and restated in its entirety
as follows:

"Building: 866 Malcolm Road, Suite 100F, Burlingame, California 94010."

3.                    Premises. As of the Surrender Date, the definition of
"Premises" on Page 1 of the Lease is hereby amended and restated in its entirety
as follows:

"Premises: That Building containing approximately 11,424 rentable square feet,
as determined by Landlord, as shown on Exhibit A."

Commencing on the Surrender Date, Exhibit a attached to the Lease shall be
amended to exclude the Surrender Premises.

4.           Rentable Area of Premises. As of the Surrender Date, the definition
of "Rentable Area of Premises" on Page 1 of the Lease is hereby amended and
restated in its entirety as follows:

"Rentable Area of Premises; 11,424 sq. ft."

5.           Building's Share of Project. Commencing on the Surrender Date, the
defined term "Building's Share of Project" on page 1 of the Lease is deleted in
their entirety and replaced with the following:

"Building's Share of Project: 10.73%"

6.           Base Rent. Tenant shall continue paying Base Rent for the Premises
as required under the Lease through the expiration of the Base Term.
Notwithstanding the foregoing, commencing on the Surrender Date, Tenant shall no
longer be required to pay Base Rent with respect to the Surrender Premises.

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7.          Security Deposit. Commencing on the Surrender Date, the defined term
"Security Deposit" on page 1 of the Lease is deleted in their entirety and
replaced with the following:

"Security Deposit: $60,425.54"

8.          Surrender of the Surrender Premises. The Lease with respect to the
Surrender Premises shall terminate as provided for in the Lease on the Surrender
Date. Tenant shall voluntarily surrender the Surrender Premises on or before
such date in the condition which Tenant is required to surrender the Surrender
Premises as of the expiration of the Lease, Tenant agrees to cooperate with
Landlord in all matters, as applicable, relating to surrendering of the
Surrender Premises as required under the Lease. From and after the Surrender
Date, Tenant shall have no further rights of any kind with respect to the
Surrender Premises. Notwithstanding the foregoing, those provisions of the Lease
which, by their terms, survive the termination of the Lease shall survive the
surrender of the Surrender Premises and termination of the Lease with respect to
the Surrender Premises as provided for herein. Nothing herein shall excuse
Tenant from Its obligations under the Lease with respect to the Surrender
Premises prior to the Surrender Date.

9.          Brokers. Landlord and Tenant each represents and warrants that it
has not dealt with any broker, agent or other person (collectively, "Broker") in
connection with the transaction reflected in this Third Amendment and that no
Broker brought about this transaction. Landlord and Tenant each hereby agree to
indemnify and hold the other harmless from and against any claims by any Broker,
other than the brokers, if any named in this Third Amendment, claiming a
commission or other form of compensation by virtue of having dealt with Tenant
or Landlord, as applicable, with regard to this leasing transaction.

10.        Miscellaneous.

a.           This Third Amendment is the entire agreement between the parties
with respect to the subject matter hereof and supersedes all prior and
contemporaneous oral and written agreements and discussions. This Third
Amendment may be amended only by an agreement in writing, signed by the parties
hereto.

b.           This Third Amendment is binding upon and shall inure to the benefit
of the parties hereto, their respective agents, employees, representatives,
officers, directors, divisions, subsidiaries, affiliates, assigns, heirs,
successors in interest and shareholders.

c.           This Third Amendment may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which when taken together
shall constitute one and the same instrument. The signature page of any
counterpart may be detached therefrom without impairing the legal effect of the
signature(s) thereon provided such signature page is attached to any other
counterpart identical thereto except having additional signature pages executed
by other parties to this Third Amendment attached thereto.

d.           Except as amended and/or modified by this Third Amendment, the
Lease is hereby ratified and confirmed and all other terms of the Lease shall
remain in full force and effect, unaltered and unchanged by this Third
Amendment. In the event of any conflict between the provisions of this Third
Amendment and the provisions of the Lease, the provisions of this Third
Amendment shall prevail. Whether or not specifically amended by this Third
Amendment, all of the terms and provisions of the Lease are hereby amended to
the extent necessary to give effect to the purpose and intent of this Third
Amendment.

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

 

LANDLORD: ARE-819/863 MITTEN ROAD, LLC, A Delaware limited liability company By:
ALEXANDRIA REAL ESTATE EQUITIES, L.P.,

a Delaware limited partnership,

managing member

          By: ARE-QRS CORP.,

A Maryland corporation,

General partner

          By: lts:           TENANT: JUVARIS BIOTHERAPEUTICS, INC., a Delaware
corporation           By: Name: Title: CFO              

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EXHIBIT A

The Surrender Premises

[Attached]

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[image_004.jpg]

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EXHIBIT D

LEASE AGREEMENT

 (Attached)

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LEASE AGREEMENT

THIS LEASE AGREEMENT (this "Lease") is made this ___ day of ___________ 2011,
between ARE-819/863 MITTEN ROAD, LLC, a Delaware limited liability company
("Landlord"), and JUVARIS BIOTHERAPEUTICS, INC., a Delaware corporation
("Tenant").

Address: 866 Malcolm Road, Suite 900E, Burlingame, California 94010.

Premises: That portion of the Project, containing approximately 10,834 rentable
square feet, as determined by Landlord, as shown on Exhibit A.

Project: The real property on which the Building in which the Premises are
located, together with all improvements thereon and appurtenances thereto as
described on Exhibit B.

Building: The specific building in the Project located at 866 Malcolm Road,
Burlingame, California.

Base Rent: $2.92 per rentable square foot per month

Rentable Area of Premises: 10,834 sq. ft.

Rentable Area of Building: 10,834 sq. ft. Building's Share of Project: 10.17%

Rentable Area of Project: 106,497 sq. ft.

Tenant's Share of Operating Expenses: 100%

Security Deposit: $117,730.36

Rent Adjustment Percentage: Greater of 3% or the CPI Adjustment Percentage not
to exceed 5%.

Base Term: Beginning on the Commencement Date and ending February 29, 2012.

Permitted Use: Research and development laboratory, manufacturing, related
office and other related uses consistent with the character of the Project and
otherwise in compliance with the provisions of Section 7 hereof.

Address for Rent Payment: Landlord's Notice Address:

385 E. Colorado Boulevard, Suite 299 385 E. Colorado Boulevard, Suite 299

Pasadena, CA 91101 Pasadena, CA 91101

Attention: Accounts Receivable Attention: Corporate Secretary

Tenant's Notice Address:

863 Mitten Road

Burlingame, California 94010

Attention: Chief Executive Officer

and

6200 Stoneridge Mall Road

Pleasanton, CA 94588

Attention: Chief Executive Officer

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The following Exhibits and Addenda are attached hereto and incorporated herein
by this reference:
[ X ] EXHIBIT A - PREMISES DESCRIPTION

[ X ] EXHIBIT C - INTENTIONALLY OMITTED

[ X ] EXHIBIT E - RULES AND REGULATIONS

[ X ] EXHIBIT G - CORE ASSET EQUIPMENT

[ X ] EXHIBIT B - DESCRIPTION OF PROJECT

[ X ] EXHIBIT D - COMMENCEMENT DATE

[ X ] EXHIBIT F - TENANT'S PERSONAL PROPERTY

[ X ] EXHIBIT H - ASBESTOS DISCLOSURE

1. Lease of Premises. Upon and subject to all of the terms and conditions
hereof, Landlord hereby leases the Premises to Tenant and Tenant hereby leases
the Premises from Landlord. The portions of the Project which are for the
non-exclusive use of tenants of the Project are collectively referred to herein
as the "Common Areas." Landlord reserves the right to modify Common Areas,
provided that such modifications do not materially adversely affect Tenant's use
of the Premises for the Permitted Use and provided that such modifications do
not materially increase the obligations or materially decrease the rights of
Tenant under this Lease.

2. Delivery; Acceptance of Premises; Commencement Date. Landlord and Tenant
hereby acknowledge that the "Commencement Date" of this Lease shall be the date
that this Lease Is mutually executed and delivered by the parties. Upon request
of Landlord, Tenant shall execute and deliver a written acknowledgment of the
Commencement Date and the expiration date of the Term in the form of the
"Acknowledgement of Commencement Date" attached to this Lease as Exhibit D;
provided, however, Tenant's failure to execute and deliver such acknowledgment
shall not affect Landlord's rights hereunder. The "Term" of this Lease shall be
the Base Term, as defined above on the first page of this Lease.

Landlord and Tenant acknowledge and agree that immediately prior to the date
hereof, Tenant occupied the Premises pursuant to a Lease Agreement with Landlord
dated February 15, 2007, as amended (as amended, "Prior Lease").

Except as set forth in this Lease, if applicable: (i) Landlord shall have no
obligation for any defects in the Premises; and (ii) Tenant's occupancy of the
Premises pursuant to the terms of the Prior Lease shall be conclusive evidence
that Tenant accepts the Premises and that the Premises are in good condition.

Tenant agrees and acknowledges that neither Landlord nor any agent of Landlord
has made any representation or warranty with respect to the condition of all or
any portion of the Premises or the Project, and/or the suitability of the
Premises or the Project for the conduct of Tenant's business, and Tenant waives
any implied warranty that the Premises or the Project are suitable for the
Permitted Use. This Lease constitutes the complete agreement of Landlord and
Tenant with respect to the subject matter hereof and supersedes any and all
prior representations, Inducements, promises, agreements, understandings and
negotiations which are not contained herein. Landlord in executing this Lease
does so in reliance upon Tenant's representations, warranties, acknowledgments
and agreements contained herein.

3. Rent.

(a) Base Rent. The Security Deposit shall be due and payable on delivery of an
executed copy of this Lease to Landlord and the first month's Base Rent shall be
due on the Commencement Date. On or before the first day of each calendar month
during the Term, except as otherwise set forth herein, Tenant shall pay to
Landlord in advance, without demand, abatement, deduction or set-off, monthly
installments of Base Rent, in lawful money of the United States of America, at
the office of Landlord for payment of Rent set forth above, or to such other
person or at such other place as Landlord may from time to time designate in
writing, Payments of Base Rent for any fractional calendar month shall be
prorated. The obligation of Tenant to pay Base Rent and other sums to Landlord
and the obligations of Landlord under this Lease are independent obligations.
Tenant shall have no right at any time to abate, reduce, or set-off any Rent (as
defined in Section 5) due hereunder except for any abatement as may be expressly
provided in this Lease.

(b) Additional Rent. In addition to Base Rent, Tenant agrees to pay to Landlord
as additional rent ("Additional Rent"): (i) Tenant's Share of "Operating
Expenses" (as defined in Section 5), and (ii) any and all other amounts Tenant
assumes or agrees to pay under the provisions of this Lease, including, without
limitation, any and all other sums that may become due by reason of any default
of Tenant or failure to comply with the agreements, terms, covenants and
conditions of this Lease to be performed by Tenant, after any applicable notice
and cure period,

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4.           Intentionally Omitted.

5.           Operating Expense Payments. Landlord shall deliver to Tenant a
written estimate of Operating Expenses for each calendar year during the Term
(the "Annual Estimate"), which may be revised by Landlord from time to time
during such calendar year. During each month of the Term, on the same date that
Base Rent is due, Tenant shall pay Landlord an amount equal to 1/12th of
Tenant's Share of the Annual Estimate. Payments for any fractional calendar
month shall be prorated.

The term "Operating Expenses" means all costs and expenses of any kind or
description whatsoever incurred or accrued each calendar year by Landlord with
respect to the Building (including the Building's Share of all costs and
expenses of any kind or description incurred or accrued by Landlord with respect
to the Project which are not specific to the Building or any other building
located in the Project) (including, without duplication, Taxes (as defined in
Section 9), capital repairs and improvements amortized over the lesser of 10
years or the useful life of such capital items as reasonably determined by
Landlord ("Approved Capital Expenses"), and the costs of Landlord's third party
property manager or, if there is no third party property manager, administration
rent in the amount of 3.0% of Base Rent), excluding only:

(a)              the original construction costs of the Project and renovation
prior to the date of the Lease and costs of correcting defects in such original
construction or renovation;

(b)              capital expenditures for expansion of the Project and other
capital expenditures to the extent not Approved Capital Expenses;

(c)               costs incurred in connection with the environmental cleanup,
response action or remediation on, in or under or about the Project, to the
extent related to the known presence of Hazardous Materials (as herein defined)
in, on or under or about the Project on or before the date hereof,

(d)              interest, principal payments of Mortgage (as defined in Section
27) debts of Landlord, financing costs and amortization of funds borrowed by
Landlord, whether secured or unsecured and all payments of base rent (but not
taxes or operating expenses) under any ground lease or other underlying lease of
all or any portion of the Project;

(e)               depreciation of the Project and capital expense reserves
(except for capital improvements, the cost of which are includable in Operating
Expenses);

(f)                advertising, legal and space planning expenses and leasing
commissions and other costs and expenses incurred in procuring and leasing space
to tenants for the Project, including any leasing office maintained In the
Project, free rent and construction allowances for tenants;

(g)               legal and other expenses incurred in the negotiation or
enforcement of leases;

(h)              completing, fixturing, improving, renovating, painting,
redecorating or other work, which Landlord pays for or performs for other
tenants within their premises, and costs of correcting defects in such work;

(i)                costs of utilities outside normal business hours sold to
tenants of the Project;

(j)                costs to be reimbursed by other tenants of the Project or
Taxes to be paid directly by Tenant or other tenants of the Project, whether or
not actually paid;

(k)               salaries, wages, benefits and other compensation paid to
officers and employees of Landlord who are not assigned in whole or in part to
the operation, management, maintenance or repair of the Project;

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(l)                general organizational, administrative and overhead costs
relating to maintaining Landlord's existence, either as a corporation,
partnership, or other entity, including general corporate, legal and accounting
expenses;

(m)             costs (including attorneys' fees and costs of settlement,
judgments and payments in lieu thereof) incurred in connection with disputes
with tenants, other occupants, or prospective tenants, and costs and expenses,
including legal fees, incurred in connection with negotiations or disputes with
employees, consultants, management agents, leasing agents, purchasers or
mortgagees of the Building;

(n)              costs incurred by Landlord due to the violation by Landlord,
its employees, agents or contractors or any tenant of the terms and conditions
of any lease of space In the Project or any Legal Requirement (as defined in
Section 7):

(o)              penalties, fines or interest incurred as a result of Landlord's
inability or failure to make payment of Taxes and/or to file any tax or
informational returns when due, or from Landlord’s failure to make any payment
of Taxes required to be made by Landlord hereunder before delinquency;

(p)              overhead and profit Increment paid to Landlord or to
subsidiaries or affiliates of Landlord for goods and/or services in or to the
Project to the extent the same exceeds the costs of such goods and/or services
rendered by unaffiliated third parties on a competitive basis;

(q)              costs of Landlord's charitable or political contributions, or
of fine art maintained at the Project;

(r)               costs in connection with services (including electricity),
items or other benefits of a type which are not standard for the Project and
which are not available to Tenant without specific charges therefore, but which
are provided to another tenant or occupant of the Project, whether or not such
other tenant or occupant is specifically charged therefore by Landlord;

(s)               costs incurred In the sale or refinancing of the Project;

(t)                (net income taxes of Landlord or the owner of any interest in
the Project, franchise, capital stock, gift, estate or inheritance taxes or any
federal, state or local documentary taxes imposed against the Project or any
portion thereof or Interest therein;

(u)              (any expenses otherwise includable within Operating Expenses to
the extent actually reimbursed by persons other than tenants of the Project
under leases for space in the Project.

(v)               costs incurred in connection with the operation of any parking
concession within the Project;

(w)             costs incurred in connection with the performance of alterations
or modifications to the Project (other than the Premises) that are required
solely due to the non-compliance of the Project (other than the Premises) with
Legal Requirements applicable to the Project as of the date hereof; and

(x)               costs due to casualty (including insurance deductibles) or
condemnation to the extent Tenant's Share of such costs exceed an amount equal
to 4 month's Base Rent in any year.

Within 90 days after the end of each calendar year (or such longer period as may
be reasonably required), Landlord shall furnish to Tenant a statement (an
"Annual Statement") showing in reasonable detail: (a) the total and Tenant's
Share of actual Operating Expenses for the previous calendar year, and (b) the
total of Tenant's payments in respect of Operating Expenses for such year. If
Tenant's Share of actual Operating Expenses for such year exceeds Tenant's
payments of Operating Expenses for such year, the excess shall be due and
payable by Tenant as Rent within 30 days after delivery of such Annual Statement
to Tenant, If Tenant's payments of Operating Expenses for such year exceed
Tenant's Share of actual Operating Expenses for such year Landlord shall pay the
excess to Tenant within 30 days after delivery of such Annual Statement, except
that after the expiration, or earlier termination of the Term or if Tenant is
delinquent in its obligation to pay Rent, Landlord shall pay the excess to
Tenant after deducting all other amounts due Landlord.

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The Annual Statement shall be final and binding upon Tenant unless Tenant,
within 30 days after Tenant's receipt thereof, shall contest any Item therein by
giving written notice to Landlord, specifying each item contested and the reason
therefore. If, during such 30 day period, Tenant reasonably and in good faith
questions or contests the accuracy of Landlord's statement of Tenant's Share of
Operating Expenses, Landlord will provide Tenant with access to Landlord's books
and records relating to the operation of the Project and such information as
Landlord reasonably determines to be responsive to Tenant's questions (the
"Expense Information"). If after Tenant's review of such Expense Information,
Landlord and Tenant cannot agree upon the amount of Tenant's Share of Operating
Expenses, then Tenant shall have the right to have an independent public
accounting firm selected by Tenant from among the 4 largest in the United
States, working pursuant to a fee arrangement other than a contingent fee (at
Tenant's sole cost and expense) and approved by Landlord (which approval shall
not be unreasonably withheld or delayed), audit and/or review the Expense
Information for the year in question (the "Independent Review"). The results of
any such Independent Review shall be binding on Landlord and Tenant. If the
Independent Review shows that the payments actually made by Tenant with respect
to Operating Expenses for the calendar year in question exceeded Tenant's Share
of Operating Expenses for such calendar year, Landlord shall at Landlord's
option either (i) credit the excess amount to the next succeeding installments
of estimated Operating Expenses or (ii) pay the excess to Tenant within 30 days
after delivery of such statement, except that after the expiration or earlier
termination of this Lease or if Tenant is delinquent in its obligation to pay
Rent, Landlord shall pay the excess to Tenant after deducting all other amounts
due Landlord. If the Independent Review shows that Tenant's payments with
respect to Operating Expenses for such calendar year were less than Tenant's
Share of Operating Expenses for the calendar year. Tenant shall pay the
deficiency to Landlord within 30 days after delivery of such statement. If the
Independent Review shows that Tenant has overpaid with respect to Operating
Expenses by more than 5% then Landlord shall reimburse Tenant for all costs
incurred by Tenant for the Independent Review. Operating Expenses for the
calendar years in which Tenant's obligation to share therein begins and ends
shall be prorated.

The measurement provided for on the first page of this Lease shall conclusively
be deemed to be the rentable square footage of the Premises and shall not be
subject to further remeasurement. Tenant's Share of Operating Expenses shall be
subject to further adjustment for changes in the physical size of the Building
or the Project occurring thereafter. If Landlord has a reasonable basis for
doing so, Landlord may equitably increase Tenant's Share for any item of expense
or cost reimbursable by Tenant that relates to a repair, replacement, or service
that benefits only the Premises or only a portion of the Project that includes
the Premises or that varies with occupancy or use. Base Rent, Tenant's Share of
Operating Expenses and all other amounts payable by Tenant to Landlord hereunder
are collectively referred to herein as "Rent."

6.           Security Deposit. Tenant shall deposit with Landlord, upon delivery
of an executed copy of this Lease to Landlord, a security deposit (the "Security
Deposit") for the performance of all of Tenant's obligations hereunder in the
amount set forth on page 1 of this Lease, which Security Deposit shall be in the
form of an unconditional and irrevocable letter of credit (the "Letter of
Credit"): (i) in form and substance satisfactory to Landlord, (ii) naming
Landlord as beneficiary, (iii) expressly allowing Landlord to draw upon It at
any time from time to time by delivering to the issuer notice that Landlord is
entitled to draw thereunder, (iv) issued by an FDIC-insured financial
institution satisfactory to Landlord, and (v) redeemable by presentation of a
sight draft in the state of Landlord's choice. If Tenant does not provide
Landlord with a substitute Letter of Credit complying with all of the
requirements hereof at least 10 days before the stated expiration date of any
then current Letter of Credit, Landlord shall have the right to draw the full
amount of the current Letter of Credit and hold the funds drawn in cash without
obligation for interest thereon as the Security Deposit, The Security Deposit
shall be held by Landlord as security for the performance of Tenant's
obligations under this Lease. The Security Deposit is not an advance rental
deposit or a measure of Landlord's damages in case of Tenant's default. Upon
each occurrence of a Default (as defined in Section 20), Landlord may use all or
any part of the Security Deposit to pay delinquent payments due under this
Lease, future rent damages under California Civil Code Section 1951.2, and the
cost of any damage, injury, expense or liability caused by such Default, without
prejudice to any other remedy provided herein or provided by law.. Landlord's
right to use the Security Deposit under this Section 6 includes the right to use
the Security Deposit to pay future rent damages following the termination of
this Lease pursuant to Section 21(c) below. Upon any use of all or any portion
of the Security Deposit, Tenant shall pay Landlord on demand the amount that
will restore the Security Deposit to the amount set forth on Page 1 of this
Lease. Tenant hereby waives the provisions of any law, now or hereafter in
force, including, without limitation, California Civil Code Section 1951.7,
which provide that Landlord may claim from a security deposit only those sums
reasonably necessary to remedy defaults in the payment of Rent, to repair damage
caused by Tenant or to clean the Premises, it being agreed that Landlord may, in
addition, claim those sums reasonably necessary to compensate Landlord for any
other loss or damage, foreseeable or unforeseeable, caused by the act or
omission of Tenant or any officer, employee, agent or invitee of Tenant. Upon
bankruptcy or other debtor-creditor proceedings against Tenant, the Security
Deposit shall be deemed to be applied first to the payment of Rent and other
charges due Landlord for periods prior to the filing of such proceedings. Upon
any such use of all or any portion of the Security Deposit, Tenant shall, within
5 days after demand from Landlord, restore the Security Deposit to its original
amount. If Tenant shall fully perform every provision of this Lease to be
performed by Tenant, the Security Deposit, or any balance thereof (i.e., after
deducting therefrom all amounts to which Landlord is entitled under the
provisions of this Lease), shall be returned to Tenant (or, at Landlord's
option, to the last assignee of Tenant's interest hereunder) within 90 days
after the expiration or earlier termination of this Lease.

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If Landlord transfers its interest in the Project or this Lease, Landlord shall
either (a) transfer any Security Deposit then held by Landlord to a person or
entity assuming Landlord's obligations under this Section 6, or (b) return to
Tenant any Security Deposit then held by Landlord and remaining after the
deductions permitted herein. Upon such transfer to such transferee or the return
of the Security Deposit to Tenant, Landlord shall have no further obligation
with respect to the Security Deposit, and Tenant's right to the return of the
Security Deposit shall apply solely against Landlord's transferee. The Security
Deposit is not an advance rental deposit or a measure of Landlord's damages in
case of Tenant's default. Landlord's obligation respecting the Security Deposit
is that of a debtor, not a trustee, and no interest shall accrue thereon.

7.           Use. The Premises shall be used solely for the Permitted Use set
forth in the basic lease provisions on page 1 of this Lease, and in compliance
with all laws, orders, judgments, ordinances, regulations, codes, directives,
permits, licenses, covenants and restrictions now or hereafter applicable to the
Premises, and to the use and occupancy thereof, including, without limitation,
the Americans With Disabilities Act, 42 U.S.C. § 12101, et seq. (together with
the regulations promulgated pursuant thereto, "ADA") (collectively, "Legal
Requirements" and each, a "Legal Requirement"). Tenant shall, upon 5 days'
written notice from Landlord, discontinue any use of the Premises which Is
declared by any Governmental Authority (as defined in Section 9) having
jurisdiction to be a violation of a Legal Requirement. Tenant will not use or
permit the Premises to be used for any purpose or in any manner that would void
Tenant's or Landlord's insurance, increase the Insurance risk, or cause the
disallowance of any sprinkler or other credits. The use that Tenant has
disclosed to Landlord that Tenant will be making of the Premises as of the
Commencement Date will not result in the voidance of or an increased insurance
risk with respect to the insurance currently being maintained by Landlord.
Tenant shall not permit any part of the Premises to be used as a "place of
public accommodation", as defined in the ADA or any similar legal requirement.
Tenant shall reimburse Landlord promptly upon demand for any additional premium
charged for any such insurance policy by reason of Tenant's failure to comply
with the provisions of this Section or otherwise caused by Tenant's use and/or
occupancy of the Premises. Tenant will use the Premises in a careful, safe and
proper manner and will not commit or permit waste, overload the floor or
structure of the Premises, subject the Premises to use that would damage the
Premises or obstruct or interfere with the rights of Landlord or other tenants
or occupants of the Project, including conducting or giving notice of any
auction, liquidation, or going out of business sale on the Premises, or using or
allowing the Premises to be used for any unlawful purpose. Tenant shall cause
any equipment or machinery to be installed in the Premises so as to reasonably
prevent sounds or vibrations from the Premises from extending into Common Areas,
or other space in the Project. Tenant shall not place any machinery or equipment
weighing 500 pounds or more in or upon the Premises or transport or move such
items through the Common Areas of the Project or in the Project elevators
without the prior written consent of Landlord. Tenant shall not, without the
prior written consent of Landlord, use the Premises in any manner which will
require ventilation, air exchange, heating, gas, steam, electricity or water
beyond the existing capacity of the Project as proportionately allocated to the
Premises based upon Tenant's Share as usually furnished for the Permitted Use.

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Landlord shall, as an Operating Expense (to the extent such Legal Requirement is
generally applicable to similar buildings in the area in which the Project is
located) or at Tenant's expense (to the extent such Legal Requirement is
applicable solely by reason of Tenant's, as compared to other tenants of the
Project, particular use of the Premises) make any alterations or modifications
to the Project that are required by Legal Requirements, including the Americans
With Disabilities Act, 42 U.S.C. § 12101, et seq. (together with regulations
promulgated pursuant thereto, "ADA"). In addition, Landlord shall, at Landlord's
expense, make any alterations or modifications to the Premises that are required
due to the non-compliance of the Premises with the Legal Requirements applicable
to the Premises as of the Commencement Date. Except as otherwise set forth in
this Section 7. Tenant, at its sole expense, shall make any alterations or
modifications to the interior of the Premises that are required by Legal
Requirements (including, without limitation, compliance of the Premises with the
ADA). Notwithstanding any other provision herein to the contrary, Tenant, at its
sole expense, shall make any alterations or modifications to the interior or the
exterior of the Premises or the Project that are required by Legal Requirements
(including, without limitation, compliance of the Premises with the ADA related
to Tenant's use or occupancy of the Premises or any alterations or modifications
made by Tenant. Notwithstanding any other provision herein to the contrary,
subject to the first two sentences of this paragraph, Tenant shall be
responsible for any and all demands, claims, liabilities, losses, costs,
expenses, actions, causes of action, damages or judgments, and all reasonable
expenses Incurred in investigating or resisting the same (including, without
limitation, reasonable attorneys' fees, charges and disbursements and costs of
suit) (collectively, "Claims") arising out of any failure of the Premises to
comply with any Legal Requirement, and Tenant shall indemnify, defend, hold and
save Landlord harmless from and against any and all Claims arising out of or in
connection with any failure of the Premises to comply with any Legal
Requirement.

8. Holding Over. If, with Landlord's express written consent, Tenant retains
possession of the Premises after the termination of the Term, (i) unless
otherwise agreed in such written consent, such possession shall be subject to
immediate termination by Landlord at any time, (II) all of the other terms and
provisions of this Lease (including, without limitation, the adjustment of Base
Rent pursuant to Section 4 hereof) shall remain in full force and effect
(excluding any expansion or renewal option or other similar right or option)
during such holdover period, (iii) Tenant shall continue to pay Base Rent in the
amount payable upon the date of the expiration or earlier termination of this
Lease or such other amount as Landlord may indicate, in Landlord's sole and
absolute discretion, in such written consent, and (iv) all other payments shall
continue under the terms of this Lease. If Tenant remains in possession of the
Premises after the expiration or earlier termination of the Term without the
express written consent of Landlord, (A) Tenant shall become a tenant at
sufferance upon the terms of this Lease except that the monthly rental shall be
equal to 150% of Rent in effect during the last 30 days of the Term for the
first 90 days of such tenancy at sufferance and thereafter 200% of Rent in
effect during the last 30 days of the Term, and (B) Tenant shall be responsible
for all damages suffered by Landlord resulting from or occasioned by Tenant's
holding over, including consequential damages. No holding over by Tenant,
whether with or without consent of Landlord, shall operate to extend this Lease
except as otherwise expressly provided, and this Section 8 shall not be
construed as consent for Tenant to retain possession of the Premises. Acceptance
by Landlord of Rent after the expiration of the Term or earlier termination of
this Lease shall not result in a renewal or reinstatement of this Lease.

9. Taxes. Landlord shall pay, as part of Operating Expenses, all taxes, levies,
assessments and governmental charges of any kind (collectively referred to as
"Taxes") imposed by any federal, state, regional, municipal, local or other
governmental authority or agency, including, without limitation, quasi-public
agencies (collectively, "Governmental Authority") during the Term, including,
without limitation, all Taxes: (i) imposed on or measured by or based, in whole
or in part, on rent payable to Landlord under this Lease and/or from the rental
by Landlord of the Project or any portion thereof, or (ii) based on the square
footage, assessed value or other measure or evaluation of any kind of the
Premises or the Project, or (iii) assessed or imposed by or on the operation or
maintenance of any portion of the Premises or the Project, including parking, or
(iv) assessed or imposed by, or at the direction of, or resulting from statutes
or regulations, or interpretations thereof, promulgated by, any Governmental
Authority, or (v) imposed as a license or other fee on Landlord's business of
leasing space in the Project. Landlord may contest by appropriate legal
proceedings the amount, validity, or application of any Taxes or liens securing
Taxes. Notwithstanding anything to the contrary contained in this Lease, Taxes
shall not include any net income taxes, estate taxes or inheritance taxes
Imposed on Landlord unless such net income taxes are in substitution for any
Taxes payable hereunder. If any such Tax is levied or assessed directly against
Tenant, then Tenant shall be responsible for and shall pay the same at such
times and in such manner as the taxing authority shall require. Tenant shall
pay, prior to delinquency, any and all Taxes levied or assessed against any
personal property or trade fixtures placed by Tenant in the Premises, whether
levied or assessed against Landlord or Tenant. If any Taxes on Tenant's personal
property or trade fixtures are levied against Landlord or Landlord's property,
or if the assessed valuation of the Project is increased by a value attributable
to improvements in or alterations to the Premises, whether owned by Landlord or
Tenant and whether or not affixed to the real property so as to become a part
thereof, higher than the base valuation on which Landlord from time-to-time
allocates Taxes to all tenants In the Project, Landlord shall have the right,
but not the obligation, to pay such Taxes. Landlord's determination of any
excess assessed valuation shall be binding and conclusive, absent manifest
error. The amount of any such payment by Landlord shall constitute Additional
Rent due from Tenant to Landlord immediately upon demand. Notwithstanding
anything to the contrary herein, Landlord shall only charge Tenant for such
increased assessments as if those assessments were paid by Landlord over the
longest possible term which Landlord is permitted to pay for the applicable
assessments.

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10.        Parking. Subject to all matters of record, Force Majeure, a Taking
(as defined In Section 19 below) and the exercise by Landlord of its rights
hereunder, Tenant shall have the right, in common with other tenants of the
Project pro rata in accordance with the rentable area of the Premises and the
rentable areas of the Project occupied by such other tenants, to park In those
areas designated for non-reserved parking, subject in each case to Landlord's
rules and regulations. Landlord may allocate parking spaces among Tenant and
other tenants in the Project pro rata as described above if Landlord determines
that such parking facilities are becoming crowded. Landlord shall not be
responsible for enforcing Tenant's parking rights against any third parties,
including other tenants of the Project.

11.        Utilities, Services. Landlord shall provide, subject to the terms of
this Section 11, water, electricity, heat, light, power, telephone, sewer, and
other utilities (including gas and fire sprinklers to the extent the Project is
plumbed for such services), refuse and trash collection and janitorial services
(collectively, "Utilities"). Landlord shall pay, as Operating Expenses or
subject to Tenant's reimbursement obligation, for all Utilities used on the
Premises, all maintenance charges for Utilities, and any storm sewer charges or
other similar charges for Utilities imposed by any Governmental Authority or
Utility provider, and any taxes, penalties, surcharges or similar charges
thereon. Landlord may cause, at Tenant's expense, any Utilities to be separately
metered or charged directly to Tenant by the provider. Tenant shall pay directly
to the Utility provider, prior to delinquency, any separately metered Utilities
and services which may be furnished to Tenant or the Premises during the Term.
Tenant shall pay, as part of Operating Expenses, its share of all charges for
jointly metered Utilities based upon consumption, as reasonably determined by
Landlord. No interruption or failure of Utilities, from any cause whatsoever
other than Landlord's willful misconduct, shall result in eviction or
constructive eviction of Tenant, termination of this Lease or the abatement of
Rent. Tenant agrees to limit use of water and sewer with respect to Common Areas
to normal restroom use.

12.        Alterations and Tenant's Property. Any alterations, additions, or
improvements made to the Premises by or on behalf of Tenant, Including
additional locks or bolts of any kind or nature upon any doors or windows in the
Premises, but excluding installation, removal or realignment of furniture
systems (other than removal of furniture systems owned or paid for by Landlord)
not involving any modifications to the structure or connections (other than by
ordinary plugs or jacks) to Building Systems (as defined in Section 13)
("Alterations") shall be subject to Landlord's prior written consent, which may
be given or withheld in Landlord's sole discretion if any such Alteration
affects the structure or Building Systems, If Landlord approves any Alterations,
Landlord may impose such conditions on Tenant in connection with the
commencement, performance and completion of such Alterations as Landlord may
deem appropriate in Landlord's reasonable discretion. Any request for approval
shall be in writing, delivered not less than 15 business days in advance of any
proposed construction, and accompanied by plans, specifications, bid proposals,
work contracts and such other information concerning the nature and cost of the
alterations as may be reasonably requested by Landlord, including the Identities
and mailing addresses of all persons performing work or supplying materials.
Landlord's right to review plans and specifications and to monitor construction
shall be solely for its own benefit, and Landlord shall have no duty to ensure
that such plans and specifications or construction comply with applicable Legal
Requirements. Tenant shall cause, at its sole cost and expense, all Alterations
to comply with insurance requirements and with Legal Requirements and shall
implement at its sole cost and expense any alteration or modification required
by Legal Requirements as a result of any Alterations. Tenant shall pay to
Landlord, as Additional Rent, on demand an amount equal to 5% of all charges
incurred by Tenant or its contractors or agents in connection with any
Alteration to cover Landlord's overhead and expenses for plan review,
coordination, scheduling and supervision. Before Tenant begins any Alteration,
Landlord may post on and about the Premises notices of non-responsibility
pursuant to applicable law. Tenant shall reimburse Landlord for, and indemnify
and hold Landlord harmless from, any expense incurred by Landlord by reason of
faulty work done by Tenant or its contractors, delays caused by such work, or
inadequate cleanup.

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Tenant shall furnish security or make other arrangements reasonably satisfactory
to Landlord to assure payment for the completion of all Alterations work free
and clear of liens, and shall provide (and cause each contractor or
subcontractor to provide) certificates of insurance for workers' compensation
and other coverage in amounts and from an insurance company satisfactory to
Landlord protecting Landlord against liability for personal injury or property
damage during construction. Upon completion of any Alterations, Tenant shall
deliver to Landlord: (i) sworn statements setting forth the names of all
contractors and subcontractors who did the work and final lien waivers from all
such contractors and subcontractors; and (ii) "as built" plans for any such
Alteration.

Except for Removable Installations (as hereinafter defined), all Installations
(as hereinafter defined) shall be and shall remain the property of Landlord
during the Term and following the expiration or earlier termination of the Term,
shall not be removed by Tenant at any time during the Term, and shall remain
upon and be surrendered with the Premises as a part thereof. Notwithstanding the
foregoing, Landlord may, at the time Its approval of any such Installation is
requested, notify Tenant that Landlord requires that Tenant remove such
Installation upon the expiration or earlier termination of the Term, in which
event Tenant shall remove such Installation in accordance with the immediately
succeeding sentence. Upon the expiration or earlier termination of the Term,
Tenant shall remove (i) all wires, cables or similar equipment which Tenant has
installed in the Premises or in the risers or plenums of the Building, (ii) any
Installations for which Landlord has given Tenant notice of removal in
accordance with the immediately preceding sentence, and (iii) all of Tenant's
Property (as hereinafter defined), and Tenant shall restore and repair any
damage caused by or occasioned as a result of such removal, including, without
limitation, capping off all such connections behind the walls of the Premises
and repairing any holes. Notwithstanding the foregoing, Tenant shall not be
required to remove any of Tenant's Property listed on Exhibit F at the
expiration or earlier termination of the Term. During any restoration period
beyond the expiration or earlier termination of the Term, Tenant shall pay Rent
to Landlord as provided herein as if said space were otherwise occupied by
Tenant. If Landlord is requested by Tenant or any lender, lessor or other person
or entity claiming an interest in any of Tenant' Property to waive any lien
Landlord may have against any of Tenant's Property, and Landlord consents to
such waiver, then Landlord shall be entitled to be paid as administrative rent a
fee of $1,000 per occurrence for its time and effort In preparing and
negotiating such a waiver of lien.

For purposes of this Lease, (w) "Removable Installations" means any items listed
on Exhibit F attached hereto and any items agreed by Landlord in writing to be
included on Exhibit F in the future, (x) "Tenant's Property" means Removable
Installations and, other than Installations, any personal property or equipment
of Tenant that may be removed without material damage to the Premises, and (z)
"Installations" means all property of any kind paid for by Landlord, all
Alterations, all fixtures, and all partitions, hardware, built-in machinery,
built-in casework and cabinets and other similar additions, equipment, property
and improvements built into the Premises so as to become an integral part of the
Premises, including, without limitation, fume hoods which penetrate the roof or
plenum area, built-in cold rooms, built-in warm rooms, walk-in cold rooms,
walk-in warm rooms, deionized water systems, glass washing equipment,
autoclaves, chillers, built-in plumbing, electrical and mechanical equipment and
systems, and any power generator and transfer switch. Notwithstanding the
foregoing, Landlord and Tenant acknowledge and agree that (a) Tenant purchased
from Valentis, Inc., the prior tenant of the Premises, the equipment listed on
Exhibit G ("Core Asset Equipment") attached hereto, (b) the Core Asset Equipment
shall be and shall remain the property of Tenant during the Base Term and shall
become the property of Landlord following the expiration or earlier termination
of the Base Term, and (c) the Core Asset Equipment shall not be removed by
Tenant at any time during the Term (unless any removed item is replaced by
Tenant with an item of comparable use, value and quality), and shall remain upon
and be surrendered with the Premises as a part thereof, Tenant may use any of
the Core Asset Equipment as collateral for financing obtained by Tenant;
provided, however, that such Core Asser Equipment is specifically released by
the lender as security for such financing no later than the expiration or
earlier termination of the Base Term. If Tenant uses any of the Core Asset
Equipment as collateral pursuant to this Section, Landlord shall, upon written
request from Tenant, enter into an agreement, utilizing Landlord's standard form
of lien waiver or another form acceptable to Landlord In Its sole discretion,
with Tenant and Tenant's lender which agreement shall, among other things,
govern the parties' rights with respect to such the specifically enumerated Core
Asset Equipment.

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13.        Landlord's Repairs. Landlord, as an Operating Expense (except to the
extent the cost thereof is excluded from Operating Expenses pursuant to Section
5 hereof), shall maintain all of the roof, structural, exterior, parking and
other Common Areas of the Project, including HVAC, plumbing, fire sprinklers,
elevators and all other building systems serving the Premises including the Core
Asset Equipment ("Building Systems"), in good repair, reasonable wear and tear
and uninsured losses and damages (unless such losses and damages would have been
Insured losses or expenses if the insurance Landlord is required to maintain
hereunder had been obtained) caused by Tenant, or by any of Tenant's agents,
servants, employees, invitees and contractors (collectively, "Tenant Parties")
excluded. Losses and damages caused by Tenant or any Tenant Party shall be
repaired by Landlord, at Tenant's sole cost and expense, to the extent not
covered by insurance Landlord is required to maintain hereunder (or to the
extent such losses or damages would have been covered by Insurance Landlord is
required to maintain hereunder if such insurance had been maintained). Landlord
reserves the right to stop Building Systems services when necessary (i) by
reason of accident or emergency, or (ii) for planned repairs, alterations or
improvements, which are, in the judgment of Landlord, desirable or necessary to
be made, until said repairs, alterations or improvements shall have been
completed, provided Landlord shall use reasonable efforts to minimize
interference with Tenant's Permitted Use of the Premises. Landlord shall have no
responsibility or liability for failure to supply Building Systems services
during any such period of interruption; provided, however, that Landlord shall,
except in case of emergency, make a commercially reasonable effort to give
Tenant 24 hours advance notice of any planned stoppage of Building Systems
services for routine maintenance, repairs, alterations or improvements. Tenant
shall promptly give Landlord written notice of any repair required by Landlord
pursuant to this Section, after which Landlord shall make a commercially
reasonable effort to effect such repair. Landlord shall not be liable for any
failure to make any repairs or to perform any maintenance unless such failure
shall persist for an unreasonable time after Tenant's written notice of the need
for such repairs or maintenance as provided in this Lease. Tenant waives Its
rights under any state or local law to terminate this Lease or to make such
repairs at Landlord's expense and agrees that the parties' respective rights
with respect to such matters shall be solely as set forth herein. Repairs
required as the result of fire. earthquake, flood, vandalism, war, or similar
cause of damage or destruction shall be controlled by Section 18,
Notwithstanding the foregoing and anything to the contrary contained in this
Lease, Landlord shall only be required to repair and maintain the Core Asset
Equipment consistent with the quality and standard required if the Building were
generic laboratory research space comparable to the portion of the Project
located at 863 Mitten Road, Burlingame, California, which is subject to the
Other Lease (defined below), and not to the quality and standard that would
otherwise be required for manufacturing space. Landlord shall not be required to
perform any upgrades to any of the Core Asset Equipment or any other Building
Systems.

14.        Tenant's Repairs. Except as otherwise set forth in Section 13 hereof,
Tenant, at its expense, shall repair, replace and maintain in good condition all
portions of the Premises, including, without limitation, entries, doors,
ceilings, interior windows, interior walls, and the interior side of demising
walls. Should Tenant fail to make any such repair or replacement or fail to
maintain the Premises, Landlord shall give Tenant notice of such failure. If
Tenant fails to commence cure of such failure within 10 days of Landlord's
notice, and thereafter diligently prosecute such cure to completion, Landlord
may perform such work and shall be reimbursed by Tenant within 10 days after
demand therefore; provided, however, that if such failure by Tenant creates or
could create an emergency, Landlord may Immediately commence cure of such
failure and shall thereafter be entitled to recover the costs of such cure from
Tenant. Subject to Sections 17 and 18, Tenant shall bear the full uninsured cost
of any repair or replacement to any part of the Project that results from damage
caused by Tenant or any Tenant Party and any repair that benefits only the
Premises.

15.        Mechanic's Liens. Tenant shall discharge, by bond or otherwise, any
mechanic's lien filed against the Premises or against the Project for work
claimed to have been done for, or materials claimed to have been furnished to,
Tenant within 10 days after the filing thereof, at Tenant's sole cost and shall
otherwise keep the Premises and the Project free from any liens arising out of
work performed, materials furnished or obligations incurred by Tenant, Should
Tenant fail to discharge any lien described herein, Landlord shall have the
right, but not the obligation, to pay such claim or post a bond or otherwise
provide security to eliminate the lien as a claim against title to the Project
and the cost thereof shall be immediately due from Tenant as Additional Rent. If
Tenant shall lease or finance the acquisition of office equipment, furnishings,
or other personal property of a removable nature utilized by Tenant In the
operation of Tenant's business, Tenant warrants that any Uniform Commercial Code
Financing Statement filed as a matter of public record by any lessor or creditor
of Tenant will upon its face or by exhibit thereto indicate that such Financing
Statement is applicable only to removable personal property of Tenant located
within the Premises. In no event shall the address of the Project be furnished
on the statement without qualifying language as to applicability of the lien
only to removable personal property, located in an identified suite held by
Tenant.

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16.        Indemnification. Tenant hereby indemnifies and agrees to defend, save
and hold Landlord harmless from and against any and all Claims for injury or
death to persons or damage to property occurring within or about the Premises,
arising directly or indirectly out of use or occupancy of the Premises or a
breach or default by Tenant in the performance of any of its obligations
hereunder, unless caused solely by the willful misconduct or gross negligence of
Landlord. Landlord shall not be liable to Tenant for, and Tenant assumes all
risk of damage to, personal property (including, without limitation, loss of
records kept within the Premises). Tenant further waives any and all Claims for
injury to Tenant's business or loss of income relating to any such damage or
destruction of personal property (including, without limitation, any loss of
records). Landlord shall not be liable for any damages arising from any act,
omission or neglect of any tenant in the Project or of any other third party.

17.        Insurance. Landlord shall maintain all risk property and, if
applicable, sprinkler damage insurance covering the full replacement cost of the
Projector such lesser coverage amount as Landlord may elect provided such
coverage amount is not less than 90% of such full replacement cost. Landlord
shall further procure and maintain commercial general liability insurance with a
single loss limit of not less than $2,000,000 for bodily injury and property
damage with respect to the Project. Landlord may, but is not obligated to,
maintain such other insurance and additional coverages as it may deem necessary,
including, but not limited to, flood, environmental hazard and earthquake, loss
or failure of building equipment, errors and omissions, rental loss during the
period of repair or rebuilding, workers' compensation insurance and fidelity
bonds for employees employed to perform services and insurance for any
improvements installed by Tenant or which are in addition to the standard
improvements customarily furnished by Landlord without regard to whether or not
such are made a part of the Project. All such insurance shall be included as
part of the Operating Expenses. The Project may be included in a blanket policy
(in which case the cost of such insurance allocable to the Project will be
determined by Landlord based upon the insurer's cost calculations). Tenant shall
also reimburse Landlord for any increased premiums or additional insurance which
Landlord reasonably deems necessary as a result of Tenant's use of the Premises.

Tenant, at its sole cost and expense, shall maintain during the Term: all risk
property insurance with business interruption and extra expense coverage,
covering the full replacement cost of all property and improvements installed or
placed in the Premises by Tenant at Tenant's expense; workers' compensation
insurance with no less than the minimum limits required by law; employer's
liability insurance with such limits as required by law; and commercial general
liability insurance, with a minimum limit of not less than $2,000,000 per
occurrence for bodily injury and property damage with respect to the Premises.
The commercial general liability insurance policy shall name Alexandria Real
Estate Equities, Inc., and Landlord, its officers, directors, employees,
managers, agents, invitees and contractors (collectively, "Landlord Parties"),
as additional insureds; insure on an occurrence and not a claims-made basis; be
issued by Insurance companies which have a rating of not less than policyholder
rating of A and financial category rating of at least Class X in "Best's
Insurance Guide"; shall not be cancelable for nonpayment of premium unless 30
days prior written notice shall have been given to Landlord from the insurer;
contain a hostile fire endorsement and a contractual liability endorsement; and
provide primary coverage to Landlord (any policy Issued to Landlord providing
duplicate or similar coverage shall be deemed excess over Tenant's policies).
Copies of such policies (if requested by Landlord), or certificates of insurance
showing the limits of coverage required hereunder and showing Landlord as an
additional insured, along with reasonable evidence of the payment of premiums
for the applicable period, shall be delivered to Landlord by Tenant upon
commencement of the Term and upon each renewal of said insurance. Tenant's
policy may be a "blanket policy" with an aggregate per location endorsement
which specifically provides that the amount of insurance shall not be prejudiced
by other losses covered by the policy. Tenant shall, at least 5 days prior to
the expiration of such policies, furnish Landlord with renewal certificates.

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In each Instance where insurance Is to name Landlord as an additional Insured,
Tenant shall upon written request of Landlord also designate and furnish
certificates so evidencing Landlord as additional insured to: (i) any lender of
Landlord holding a security interest in the Project or any portion thereof, (ii)
the landlord under any lease wherein Landlord is tenant of the real property on
which the Project is located, if the interest of Landlord Is or shall become
that of a tenant under a ground or other underlying lease rather than that of a
fee owner, and/or (iii) any management company retained by Landlord to manage
the Project.

The property insurance obtained by Landlord and Tenant shall include a waiver of
subrogation by the insurers and all rights based upon an assignment from its
insured, against Landlord or Tenant, and their respective officers, directors,
employees, managers, agents, invitees and contractors ("Related Parties"), in
connection with any loss or damage thereby insured against. Notwithstanding
anything to the contrary contained in this Lease, neither party nor Its
respective Related Parties shall be liable to the other for loss or damage
caused by any risk insured against under property insurance required to be
maintained hereunder, regardless of the negligence of the party to the Lease
receiving the benefit of the waiver, and each party waives any claims against
the other party, and Its respective Related Parties, for such loss or damage.
The failure of a party to insure its property shall not void this waiver.
Landlord and Its respective Related Parties shall not be liable for, and Tenant
hereby waives all claims against such parties for, business interruption and
losses occasioned thereby sustained by Tenant or any person claiming through
Tenant resulting from any accident or occurrence in or upon the Premises or the
Project from any cause whatsoever. If the foregoing waivers shall contravene any
law with respect to exculpatory agreements, the liability of Landlord or Tenant
shall be deemed not released but shall be secondary to the other's Insurer.

Landlord may require insurance policy limits to be raised to conform with
reasonable requirements of Landlord's lender and/or to bring coverage limits to
levels then being generally required of new tenants within the Project.

18.        Restoration. If, at any time during the Term, the Project or the
Premises are damaged or destroyed by a fire or other casualty, Landlord shall
notify Tenant within 60 days after discovery of such damage as to the amount of
time Landlord reasonably estimates It will take to restore the Project or the
Premises, as applicable (the "Restoration Period"). If the Restoration Period is
estimated to exceed 9 months (the "Maximum Restoration Period"), Landlord may,
in such notice, elect to terminate this Lease as of the date that is 75 days
after the date of discovery of such damage or destruction; provided, however,
that notwithstanding Landlord's election to restore, Tenant may elect to
terminate this Lease by written notice to Landlord delivered within 5 business
days of receipt of a notice from Landlord estimating a Restoration Period for
the Premises longer than the Maximum Restoration Period. Unless either Tenant or
Landlord so elect to terminate this Lease, Landlord shall, subject to receipt of
sufficient insurance proceeds (with any deductible to be treated as an Operating
Expense subject to the provisions of Section 5). promptly restore the Premises
(excluding the improvements installed by Tenant or by Landlord and paid for by
Tenant), subject to delays arising from the collection of insurance proceeds,
from Force Majeure events or as needed to obtain any license, clearance or other
authorization of any kind required to enter into and restore the Premises issued
by any Governmental Authority having jurisdiction over the use, storage,
handling, treatment, generation, release, disposal, removal or remediation of
Hazardous Materials (as defined in Section 30) in, on or about the Premises
(collectively referred to herein as "Hazardous Materials Clearances"); provided,
however, that if repair or restoration of the Premises is not substantially
complete as of the end of the Maximum Restoration Period or, if longer, the
Restoration Period, Landlord may, In its sole and absolute discretion, elect not
to proceed with such repair and restoration, or Tenant may by written notice to
Landlord delivered within 5 business days of the expiration of the Maximum
Restoration Period or, if longer, the Restoration Period, elect to terminate
this Lease, in which event Landlord shall be relieved of its obligation to make
such repairs or restoration and this Lease shall terminate as of the date that
is 75 days after the later of: (i) discovery of such damage or destruction, or
(ii) the date all required Hazardous Materials Clearances are obtained, but
Landlord shall retain any Rent paid and the right to any Rent payable by Tenant
prior to such election by Landlord or Tenant. Notwithstanding the foregoing, if
a portion of the Project, not including the Building, is damaged, Landlord may
not terminate this Lease on the basis that the Restoration Period will exceed
the Maximum Restoration Period If Landlord elects to merely repair the damage
rather than redevelop or improve the Project as a whole, and Landlord actually
commences construction of the repair of such damage within 4 months after the
discovery of such damage. The Restoration Period and Maximum Restoration Period
shall not be extended by Force Majeure.

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Tenant may, at Tenant's option, promptly re-enter the Premises and commence
doing business in accordance with this Lease upon Landlord's completion of all
repairs or restoration required to be done by Landlord pursuant to this Section
18; provided, however, that Tenant shall nonetheless (and even if Tenant does
not re-enter the Premises) continue to be responsible for all of its obligations
under this Lease. Notwithstanding the foregoing, Landlord may terminate this
Lease if the Premises are damaged during the last 1 year of the Term and
Landlord reasonably estimates that it will take more than 2 months to repair
such damage, or If Insurance proceeds are not available for such restoration.
Rent shall be abated from the date all required Hazardous Material Clearances
are obtained until the Premises are repaired and restored, in the proportion
which the area of the Premises, if any, which is not usable by Tenant bears to
the total area of the Premises, unless Landlord provides Tenant with other space
in the Project during the period of repair that is suitable for the temporary
conduct of Tenant's business. Such abatement shall be the sole remedy of Tenant,
and except as provided In this Section 18. Tenant waives any right to terminate
the Lease by reason of damage or casualty loss.

The provisions of this Lease, including this Section 18, constitute an express
agreement between Landlord and Tenant with respect to any and all damage to, or
destruction of, all or any part of the Premises, or any other portion of the
Project, and any statute or regulation which is now or may hereafter be in
effect shall have no application to this Lease or any damage or destruction to
all or any part of the Premises or any other portion of the Project, the parties
hereto expressly agreeing that this Section 18 sets forth their entire
understanding and agreement with respect to such matters.

19.         Condemnation. If the whole or any material part of the Premises or
the Project Is taken for any public or quasi-public use under governmental law,
ordinance, or regulation, or by right of eminent domain, or by private purchase
In lieu thereof (a "Taking" or "Taken"), and the Taking would in Landlord's
reasonable judgment either prevent or materially Interfere with Tenant's use of
the Premises or materially interfere with or Impair Landlord's ownership or
operation of the Project, then upon written notice by Landlord this Lease shall
terminate and Rent shall be apportioned as of said date. If part of the Premises
shall be Taken, and this Lease is not terminated as provided above, Landlord
shall promptly restore the Premises and the Project as nearly as is commercially
reasonable under the circumstances to their condition prior to such partial
Taking and the rentable square footage of the Building, the rentable square
footage of the Premises, Tenant's Share of Operating Expenses and the Rent
payable hereunder during the unexpired Term shall be reduced to such extent as
may be fair and reasonable under the circumstances. Upon any such Taking,
Landlord shall be entitled to receive the entire price or award from any such
Taking without any payment to Tenant, and Tenant hereby assigns to Landlord
Tenant's interest, if any, in such award. Tenant shall have the right, to the
extent that same shall not diminish Landlord's award, to make a separate claim
against the condemning authority (but not Landlord) for such compensation as may
be separately awarded or recoverable by Tenant for moving expenses and damage to
Tenant's trade fixtures, if a separate award for such items is made to Tenant.
Tenant hereby waives any and all rights it might otherwise have pursuant to any
provision of state law to terminate this Lease upon a partial Taking of the
Premises or the Project.

20.         Events of Default. Each of the following events shall be a default
("Default") by Tenant under this Lease:

(a) Payment Defaults. Tenant shall fail to pay any installment of Rent or any
other payment hereunder when due; provided, however, that Landlord will give
Tenant notice and an opportunity to cure any failure to pay Rent within 5 days
of any such notice and Tenant agrees that such notice shall be in lieu of and
not in addition to, or shall be deemed to be, any notice required by law.

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(b)              Insurance. Any insurance required to be maintained by Tenant
pursuant to this Lease shall be canceled or terminated or shall expire or shall
be reduced or materially changed, or Landlord shall receive a notice of
nonrenewal of any such insurance and Tenant shall fail to obtain replacement
insurance at least 20 days before the expiration of the current coverage.

(c)               Abandonment. Tenant shall abandon the Premises.

(d)              Improper Transfer. Tenant shall assign, sublease or otherwise
transfer or attempt to transfer all or any portion of Tenant's interest in this
Lease or the Premises except as expressly permitted herein, or Tenant's Interest
in this Lease shall be attached, executed upon, or otherwise judicially seized
and such action Is not released within 90 days of the action.

(e)               Liens. Tenant shall fail to discharge or otherwise obtain the
release of any lien placed upon the Premises in violation of this Lease within
10 days after any such lien is filed against the Premises.

(f)                Insolvency Events. Tenant or any guarantor or surety of
Tenant's obligations hereunder shall: (A) make a general assignment for the
benefit of creditors; (B) commence any case, proceeding or other action seeking
to have an order for relief entered on its behalf as a debtor or to adjudicate
it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
liquidation, dissolution or composition of it or its debts or seeking
appointment of a receiver, trustee, custodian or other similar official for it
or for all or of any substantial part of its property (collectively a
"Proceeding for Relief"); (C) become the subject of any Proceeding for Relief
which is not dismissed within 90 days of its filing or entry; or (D) die or
suffer a legal disability (if Tenant, guarantor, or surety is an individual) or
be dissolved or otherwise fail to maintain its legal existence (If Tenant,
guarantor or surety is a corporation, partnership or other entity).

(g)               Estoppel Certificate or Subordination Agreement. Tenant falls
to execute any document required from Tenant under Sections 23 or 27 within 5
days after a second notice requesting such document.

(h)              Default under Other Lease. Tenant is in Default (as such term
is defined in the Other Lease) under that certain Lease Agreement dated as of
even date herewith between Landlord and Tenant with respect to certain premises
located at 863 Mitten Road, Burlingame, CA ("Other Lease").

(i) Other Defaults. Tenant shall fail to comply with any provision of this Lease
other than those specifically referred to in this Section 20, and, except to the
extent a different time period is otherwise provided herein, such failure shall
continue for a period of 10 days after written notice thereof from Landlord to
Tenant.

Any notice given under Section 20(1) hereof shall: (i) specify the alleged
default, (ii) demand that Tenant cure such default, (iii) be in lieu of, and not
in addition to, or shall be deemed to be, any notice required under any
provision of applicable law, and (iv) not be deemed a forfeiture or a
termination of this Lease unless Landlord elects otherwise in such notice;
provided that if the nature of Tenant's default pursuant to Section 20(i) is
such that it cannot be cured by the payment of money and reasonably requires
more than 10 days to cure, then Tenant shall not be deemed to be in default if
Tenant commences such cure within said 10 day period and thereafter diligently
prosecutes the same to completion; provided, however, that such cure shall be
completed no later than 45 days from the date of Landlord's notice.

21. Landlord's Remedies.

(a) Payment By Landlord; Interest. Upon a Default by Tenant hereunder, Landlord
may, without waiving or releasing any obligation of Tenant hereunder, make such
payment or perform such act on behalf of Tenant. All sums so paid or incurred by
Landlord, together with interest thereon, from the date such sums were paid or
incurred, at the annual rate equal to 12% per annum or the highest rate
permitted by law (the "Default Rate"), whichever is less, shall be payable to
Landlord on demand as Additional Rent. Nothing herein shall be construed to
create or Impose a duty on Landlord to mitigate any damages resulting from
Tenant's Default hereunder.

20

 

 

(b)              Late Payment Rent. Late payment by Tenant to Landlord of Rent
and other sums due will cause Landlord to incur costs not contemplated by this
Lease, the exact amount of which will be extremely difficult and impracticable
to ascertain. Such costs include, but are not limited to, processing and
accounting charges and late charges which may be imposed on Landlord under any
Mortgage covering the Premises. Therefore, if any installment of Rent due from
Tenant is not received by Landlord within 5 days after the date such payment is
due, Tenant shall pay to Landlord an additional sum equal to 6% of the overdue
Rent as a late charge. Notwithstanding the foregoing, before assessing a late
charge the first time in any calendar year, Landlord shall provide Tenant
written notice of the delinquency and will waive the right if Tenant pays such
delinquency within 5 days thereafter. The parties agree that this late charge
represents a fair and reasonable estimate of the costs Landlord will incur by
reason of late payment by Tenant. In addition to the late charge, Rent not paid
when due shall bear interest at the Default Rate from the 5th day after the date
due until paid.

(c)               Remedies. Upon the occurrence of a Default, Landlord, at its
option, without further notice or demand to Tenant, shall have in addition to
ail other rights and remedies provided In this Lease, at law or in equity, the
option to pursue any one or more of the following remedies, each and all of
which shall be cumulative and nonexclusive, without any notice or demand
whatsoever.

(i)                Terminate this Lease, or at Landlord's option, Tenant's right
to possession only, in which event Tenant shall immediately surrender the
Premises to Landlord, and if Tenant fails to do so, Landlord may, without
prejudice to any other remedy which it may have for possession or arrearages in
rent, enter upon and take possession of the Premises and expel or remove Tenant
and any other person who may be occupying the Premises or any part thereof,
without being liable for prosecution or any claim or damages therefore;

(ii)              Upon any termination of this Lease, whether pursuant to the
foregoing Section 21(c)(i) or otherwise, Landlord may recover from Tenant the
following:

(A)              The worth at the time of award of any unpaid rent which has
been earned at the time of such termination; plus

(B)              The worth at the time of award of the amount by which the
unpaid rent which would have been earned after termination until the time of
award exceeds the amount of such rental loss that Tenant proves could have been
reasonably avoided; plus

(C)              The worth at the time of award of the amount by which the
unpaid rent for the balance of the Term after the time of award exceeds the
amount of such rental loss that Tenant proves could have been reasonably
avoided; plus

(D)              Any other amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant's failure to perform its obligations
under this Lease or which in the ordinary course of things would be likely to
result therefrom, specifically including, but not limited to, brokerage
commissions and advertising expenses incurred, expenses of remodeling the
Premises or any portion thereof for a new tenant, whether for the same or a
different use, and any special concessions made to obtain a new tenant; and

(E)               At Landlord's election, such other amounts in addition to or
in lieu of the foregoing as may be permitted from time to time by applicable
law.

The term "rent" as used in this Section 21 shall be deemed to be and to mean all
sums of every nature required to be paid by Tenant pursuant to the terms of this
Lease, whether to Landlord or to others. As used in Sections 21(c)(ii) (A) and
(B), above, the "worth at the time of award" shall be computed by allowing
interest at the Default Rate. As used in Section 21 (c)(ii) (C) above, the
"worth at the time of award" shall be computed by discounting such amount at the
discount rate of the Federal Reserve Bank of San Francisco at the time of award
plus 1%.

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(iii) Landlord may continue this Lease In effect after Tenant's Default and
recover rent as it becomes due (Landlord and Tenant hereby agreeing that Tenant
has the right to sublet or assign hereunder, subject only to reasonable
limitations). Accordingly, if Landlord does not elect to terminate this Lease
following a Default by Tenant, Landlord may, from time to time, without
terminating this Lease, enforce all of its rights and remedies hereunder,
including the right to recover all Rent as It becomes due.

(iv)             Whether or not Landlord elects to terminate this Lease
following a Default by Tenant, Landlord shall have the right to terminate any
and all subleases, licenses, concessions or other consensual arrangements for
possession entered into by Tenant and affecting the Premises or may, in
Landlord's sole discretion, succeed to Tenant's interest in such subleases,
licenses, concessions or arrangements. Upon Landlord's election to succeed to
Tenant's interest in any such subleases, licenses, concessions or arrangements,
Tenant shall, as of the date of notice by Landlord of such election, have no
further right to or interest in the rent or other consideration receivable
thereunder,

(v)               Independent of the exercise of any other remedy of Landlord
hereunder or under applicable law, Landlord may conduct an environmental test of
the Premises as generally described in Section 30(d) hereof, at Tenant's
expense,

(d) Effect of Exercise. Exercise by Landlord of any remedies hereunder or
otherwise available shall not be deemed to be an acceptance of surrender of the
Premises and/or a termination of this Lease by Landlord, it being understood
that such surrender and/or termination can be effected only by the express
written agreement of Landlord and Tenant. Any law, usage, or custom to the
contrary notwithstanding, Landlord shall have the right at all times to enforce
the provisions of this Lease in strict accordance with the terms hereof; and the
failure of Landlord at any time to enforce its rights under this Lease strictly
in accordance with same shall not be construed as having created a custom in any
way or manner contrary to the specific terms, provisions, and covenants of this
Lease or as having modified the same and shall not be deemed a waiver of
Landlord's right to enforce one or more of its rights in connection with any
subsequent default. A receipt by Landlord of Rent or other payment with
knowledge of the breach of any covenant hereof shall not be deemed a waiver of
such breach, and no waiver by Landlord of any provision of this Lease shall be
deemed to have been made unless expressed in writing and signed by Landlord. To
the greatest extent permitted by law, Tenant waives the service of notice of
Landlord's intention to re-enter, re-take or otherwise obtain possession of the
Premises as provided in any statute, or to institute legal proceedings to that
end, and also waives all right of redemption in case Tenant shall be
dispossessed by a judgment or by warrant of any court or judge. Any reletting of
the Premises or any portion thereof shall be on such terms and conditions as
Landlord in its sole discretion may determine. Landlord shall not be liable for,
nor shall Tenant's obligations hereunder be diminished because of, Landlord's
failure to relet the Premises or collect rent due in respect of such reletting
or otherwise to mitigate any damages arising by reason of Tenant's Default.

22. Assignment and Subletting.

(a) General Prohibition. Without Landlord's prior written consent subject to and
on the conditions described in this Section 22. Tenant shall not, directly or
indirectly, voluntarily or by operation of law, assign this Lease or sublease
the Premises or any part thereof or mortgage, pledge, or hypothecate its
leasehold interest or grant any concession or license within the Premises, and
any attempt to do any of the foregoing shall be void and of no effect. If Tenant
is a corporation, partnership or limited liability company, the shares or other
ownership interests thereof which are not actively traded upon a stock exchange
or in the over-the-counter market, a transfer or series of transfers whereby 49%
or more of the Issued and outstanding shares or other ownership Interests of
such corporation are, or voting control is, transferred (but excepting transfers
upon deaths of individual owners) from a person or persons or entity or entities
which were owners thereof at time of execution of this Lease to persons or
entities who were not owners of shares or other ownership interests of the
corporation, partnership or limited liability company at time of execution of
this Lease, shall be deemed an assignment of this Lease requiring the consent of
Landlord as provided in this Section 22. Notwithstanding the foregoing, Tenant
shall have the right to obtain financing from institutional Investors (including
venture capital funding and corporate partners) or undergo a public offering
which results in a change in control of Tenant without such change of control
constituting an assignment under this Section 22 requiring Landlord consent,
provided that (i) Tenant notifies Landlord in writing of the financing at least
5 business days prior to the closing of the financing, and (ii) provided that in
no event shall such financing result in a change in use of the Premises from the
use contemplated by Tenant at the commencement of the Term.

22

 

(b) Permitted Transfers. If Tenant desires to assign, sublease, hypothecate or
otherwise transfer this Lease or sublet the Premises other than pursuant to a
Permitted Assignment (as defined below), then at least 15 business days, but not
more than 45 business days, before the date Tenant desires the assignment or
sublease to be effective (the "Assignment Date"), Tenant shall give Landlord a
notice (the "Assignment Notice") containing such information about the proposed
assignee or sublessee, including the proposed use of the Premises and any
Hazardous Materials proposed to be used, stored handled, treated, generated In
or released or disposed of from the Premises, the Assignment Date, any
relationship between Tenant and the proposed assignee or sublessee, and all
material terms and conditions of the proposed assignment or sublease, including
a copy of any proposed assignment or sublease In its final form, and such other
information as Landlord may deem reasonably necessary or appropriate to its
consideration whether to grant its consent. Landlord may, by giving written
notice to Tenant within 15 business days after receipt of the Assignment Notice:
(i) grant such consent, (ii) refuse such consent, in its reasonable discretion;
or (iii) terminate this Lease with respect to the space described in the
Assignment Notice as of the Assignment Date (an "Assignment Termination"). Among
other reasons, it shall be reasonable for Landlord to withhold its consent In
any of these instances: (1) the proposed assignee or subtenant is a governmental
agency; (2) in Landlord's reasonable judgment, the use of the Premises by the
proposed assignee or subtenant would entail any alterations that would lessen
the value of the leasehold improvements in the Premises, or would require
increased services by Landlord; (3) in Landlord's reasonable judgment, the
proposed assignee or subtenant is engaged in areas of scientific research or
other business concerns that are controversial; (4) in Landlord's reasonable
judgment, the proposed assignee or subtenant lacks the creditworthiness to
support the financial obligations it will incur under the proposed assignment or
sublease; (5) in Landlord's reasonable judgment, the character, reputation, or
business of the proposed assignee or subtenant is inconsistent with the desired
tenant-mix or the quality of other tenancies in the Project or is inconsistent
with the type and quality of the nature of the Building; (6) Landlord has
received from any prior landlord to the proposed assignee or subtenant a
negative report concerning such prior landlord's experience with the proposed
assignee or subtenant; (7) Landlord has experienced previous defaults by or is
in litigation with the proposed assignee or subtenant; (8) the use of the
Premises by the proposed assignee or subtenant will violate any applicable Legal
Requirement; (9) the proposed assignee or subtenant, or any entity that,
directly or indirectly, controls, is controlled by, or is under common control
with the proposed assignee or subtenant, is then an occupant of the Project;
(10) the proposed assignee or subtenant is an entity with whom Landlord is
negotiating to lease space in the Project; or (11) the assignment or sublease is
prohibited by Landlord's lender. If Landlord delivers notice of its election to
exercise an Assignment Termination, Tenant shall have the right to withdraw such
Assignment Notice by written notice to Landlord of such election within 5
business days after Landlord's notice electing to exercise the Assignment
Termination. If Tenant withdraws such Assignment Notice, this Lease shall
continue in full force and effect. If Tenant does not withdraw such Assignment
Notice, this Lease, and the term and estate herein granted, shall terminate as
of the Assignment Date with respect to the space described in such Assignment
Notice. No failure of Landlord to exercise any such option to terminate this
Lease, or to deliver a timely notice in response to the Assignment Notice, shall
be deemed to be Landlord's consent to the proposed assignment, sublease or other
transfer. Tenant shall reimburse Landlord for all of Landlord's reasonable
out-of-pocket expenses in connection with Its consideration of any Assignment
Notice. Notwithstanding the foregoing, Tenant shall be permitted to assign its
interest in this Lease (or be deemed to have assigned its Interest due to a
change in control) or sublet all or a portion of the Premises upon 30 days prior
written notice to Landlord but without Landlord's prior written consent to: (A)
any entity controlling, controlled by or under common control with Tenant or (B)
a corporation or other entity which is a successor-in-interest to Tenant, by way
of merger, consolidation, corporate reorganization, stock purchase or change of
control (due to a deemed assignment permitted pursuant to this Lease), or by the
purchase of all or substantially all of the assets or the ownership interests of
Tenant provided that (1) such merger or consolidation, or such acquisition or
assumption, as the case may be, Is for a good business purpose and not
principally for the purpose of transferring the Lease, and (2) the net worth (as
determined in accordance with generally accepted accounting principles ("GAAP"))
of the assignee Is not less than the net worth (as determined in accordance with
GAAP) of Tenant as of the date of Tenant's most current quarterly or annual
financial statements, and (3) such assignee shall agree in writing to assume all
of the terms, covenants and conditions of this Lease arising after the effective
date of the assignment (each a "Permitted Assignment"). With respect to a
Permitted Assignment described in sub-clause (A) of the preceding sentence,
Landlord shall have the right to approve the form of any such sublease or
assignment, such approval not to be unreasonably withheld or delayed.
Notwithstanding anything in this Section 22(b) to the contrary, Landlord shall
not have the right to elect an Assignment Termination In connection with a
Permitted Assignment.

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(c)          Additional Conditions. As a condition to any such assignment or
subletting, whether or not Landlord's consent is required, Landlord may require:

(I)                  that any assignee or subtenant agree, in writing at the
time of such assignment or subletting, that if Landlord gives such party notice
that Tenant Is in default under this Lease, such party shall thereafter make all
payments otherwise due Tenant directly to Landlord, which payments will be
received by Landlord without any liability except to credit such payment against
those due under the Lease, and any such third party shall agree to attorn to
Landlord or its successors and assigns should this Lease be terminated for any
reason; provided, however, in no event shall Landlord or Its successors or
assigns be obligated to accept such attornment; and

(II)                A list of Hazardous Materials, certified by the proposed
assignee or sublessee to be true and correct, which the proposed assignee or
sublessee Intends to use, store, handle, treat, generate in or release or
dispose of from the Premises, together with copies of all documents relating to
such use, storage, handling, treatment, generation, release or disposal of
Hazardous Materials by the proposed assignee or subtenant in the Premises or on
the Project, prior to the proposed assignment or subletting, including, without
limitation: permits; approvals; reports and correspondence; storage and
management plans; plans relating to the installation of any storage tanks to be
installed in or under the Project (provided, said installation of tanks shall
only be permitted after Landlord has given its written consent to do so, which
consent may be withheld in Landlord's sole and absolute discretion); and all
closure plans or any other documents required by any and all federal, state and
local Governmental Authorities for any storage tanks installed in, on or under
the Project for the closure of any such tanks. Neither Tenant nor any such
proposed assignee or subtenant is required, however, to provide Landlord with
any portion(s) of the such documents containing information of a proprietary
nature which, in and of themselves, do not contain a reference to any Hazardous
Materials or hazardous activities.

(d)              No Release of Tenant, Sharing of Excess Rents. Notwithstanding
any assignment or subletting, Tenant and any guarantor or surety of Tenant's
obligations under this Lease shall at all times remain fully and primarily
responsible and liable for the payment of Rent and for compliance with all of
Tenant's other obligations under this Lease. Except with respect to a Permitted
Assignment, if the Rent due and payable by a sublessee or assignee (or a
combination of the rental payable under such sublease or assignment plus any
bonus or other consideration therefore or Incident thereto in any form that is
paid in lieu of Rent) exceeds the sum of the rental payable under this Lease,
(excluding however, any Rent payable under this Section and actual and
reasonable brokerage fees, legal costs and any design or construction fees
directly related to and required pursuant to the terms of any such
sublease)("Excess Rent"), then Tenant shall be bound and obligated to pay
Landlord as Additional Rent hereunder 50% of such Excess Rent within 10 days
following receipt thereof by Tenant. If Tenant shall sublet the Premises or any
part thereof, Tenant hereby immediately and irrevocably assigns to Landlord, as
security for Tenant's obligations under this Lease, all rent from any such
subletting, and Landlord as assignee and as attorney-in-fact for Tenant, or a
receiver for Tenant appointed on Landlord's application, may collect such rent
and apply it toward Tenant's obligations under this Lease; except that, until
the occurrence of a Default, Tenant shall have the right to collect such rent.

(e)                                No Waiver. The consent by Landlord to an
assignment or subletting shall not relieve Tenant or any assignees of this Lease
or any sublessees of the Premises from obtaining the consent of Landlord to any
further assignment or subletting nor shall it release Tenant or any assignee or
sublessee of Tenant from full and primary liability under the Lease. The
acceptance of Rent hereunder, or the acceptance of performance of any other
term, covenant, or condition thereof, from any other person or entity shall not
be deemed to be a waiver of any of the provisions of this Lease or a consent to
any subletting, assignment or other transfer of the Premises.

24

 

(f) Prior Conduct of Proposed Transferee. Notwithstanding any other provision of
this Section 22, if (i) the proposed assignee or sublessee of Tenant has been
required by any prior landlord, lender or Governmental Authority to take
remedial action in connection with Hazardous Materials contaminating a property,
where the contamination resulted from such party's action or use of the property
in question, (ii) the proposed assignee or sublessee is subject to an
enforcement order issued by any Governmental Authority in connection with the
use, storage, handling, treatment, generation, release or disposal of Hazardous
Materials (including, without limitation, any order related to the failure to
make a required reporting to any Governmental Authority), or (Hi) because of the
existence of a pre-existing environmental condition in the vicinity of or
underlying the Project, the risk that Landlord would be targeted as a
responsible party in connection with the remediation of such pre-existing
environmental condition would be materially increased or exacerbated by the
proposed use of Hazardous Materials by such proposed assignee or sublessee,
Landlord shall be acting reasonably by refusing to consent to any assignment or
subletting to any such party.

23.             Estoppel Certificate. Tenant shall, within 10 business days of
written notice from Landlord, execute, acknowledge and deliver a statement in
writing in any form reasonably requested by a proposed lender or purchaser, (i)
certifying that this Lease is unmodified and in full force and effect (or, if
modified, stating the nature of such modification and certifying that this Lease
as so modified is in full force and effect) and the dates to which the rental
and other charges are paid in advance, if any, (ii) acknowledging that there are
not any uncured defaults on the part of Landlord hereunder, or specifying such
defaults if any are claimed, and (iii) setting forth such further information
with respect to the status of this Lease or the Premises as may be requested
thereon. Any such statement may be relied upon by any prospective purchaser or
encumbrancer of all or any portion of the real property of which the Premises
are a part. Tenant's failure to deliver such statement within such time shall,
at the option of Landlord, be conclusive upon Tenant that the Lease Is in full
force and effect and without modification except as may be represented by
Landlord in any certificate prepared by Landlord and delivered to Tenant for
execution.

24.             Quiet Enjoyment. So long as Tenant shall perform all of the
covenants and agreements herein required to be performed by Tenant, Tenant
shall, subject to the terms of this Lease, at all times during the Term, have
peaceful and quiet enjoyment of the Premises against any person claiming by,
through or under Landlord.

25.             Prorations. All prorations required or permitted to be made
hereunder shall be made on the basis of a 360 day year and 30 day months.

26.             Rules and Regulations. Tenant shall, at all times during the
Term and any extension thereof, comply with all reasonable rules and regulations
at any time or from time to time established by Landlord covering use of the
Premises and the Project. The current rules and regulations are attached hereto
as Exhibit E. If there is any conflict between said rules and regulations and
other provisions of this Lease, the terms and provisions of this Lease shall
control. Landlord shall not have any liability or obligation for the breach of
any rules or regulations by other tenants in the Project and shall not enforce
such rules and regulations in a discriminatory manner.

27.             Subordination. This Lease and Tenant's interest and rights
hereunder are hereby made and shall be subject and subordinate at all times to
the lien of any Mortgage now existing or hereafter created on or against the
Project or the Premises, and all amendments, restatements, renewals,
modifications, consolidations, refinancing, assignments and extensions thereof,
without the necessity of any further instrument or act on the part of Tenant;
provided, however that so long as there is no Default hereunder, Tenant's right
to possession of the Premises shall not be disturbed by the Holder of any such
Mortgage. Tenant agrees, at the election of the Holder of any such Mortgage, to
attorn to any such Holder. Tenant agrees upon demand to execute, acknowledge and
deliver such instruments, confirming such subordination, and such instruments of
attornment as shall be requested by any such Holder, provided any such
instruments contain appropriate non-disturbance provisions assuring Tenant's
quiet enjoyment of the Premises as set forth In this Section 27 and Section 24
hereof. Notwithstanding the foregoing, any such Holder may at any time
subordinate its Mortgage to this Lease, without Tenant's consent, by notice in
writing to Tenant, and thereupon this Lease shall be deemed prior to such
Mortgage without regard to their respective dates of execution, delivery or
recording and In that event such Holder shall have the same rights with respect
to this Lease as though this Lease had been executed prior to the execution,
delivery and recording of such Mortgage and had been assigned to such Holder.
The term "Mortgage" whenever used in this Lease shall be deemed to include deeds
of trust, security assignments and any other encumbrances, and any reference to
the "Holder" of a Mortgage shall be deemed to include the beneficiary under a
deed of trust.

25

 

28.             Surrender. Upon the expiration of the Term or earlier
termination of Tenant's right of possession, Tenant shall Surrender the Premises
to Landlord in the same condition as received, subject to any Alterations or
Installations permitted by Landlord to remain in the Premises, free of Hazardous
Materials brought upon, kept, used, stored, handled, treated, generated in, or
released or disposed of from, the Premises by any person other than a Landlord
Party (collectively, "Tenant HazMat Operations") and released of all Hazardous
Materials Clearances, broom clean, ordinary wear and tear and casualty loss and
condemnation covered by Sections 18 and 19. excepted. At least 3 months prior to
the surrender of the Premises, Tenant shall deliver to Landlord a narrative
description of the actions proposed (or required by any Governmental Authority)
to be taken by Tenant in order to surrender the Premises (including any
Installations permitted by Landlord to remain in the Premises) at the expiration
or earlier termination of the Term, free from any residual impact from the
Tenant HazMat Operations and otherwise released for unrestricted use and
occupancy (the "Surrender Plan"). Such Surrender Plan shall be accompanied by a
current listing of (i) all Hazardous Materials licenses and permits held by or
on behalf of any Tenant Party with respect to the Premises, and (ii) all
Hazardous Materials used, stored, handled, treated, generated, released or
disposed of from the Premises, and shall be subject to the review and approval
of Landlord's environmental consultant, such approval not to be unreasonably
withheld or delayed. In connection with the review and approval of the Surrender
Plan, upon the request of Landlord, Tenant shall deliver to Landlord or its
consultant such additional non-proprietary information concerning Tenant HazMat
Operations as Landlord shall request. On or before such surrender, Tenant shall
deliver to Landlord evidence that the approved Surrender Plan shall have been
satisfactorily completed and Landlord shall have the right, subject to
reimbursement at Tenant's expense as set forth below, to cause Landlord's
environmental consultant to Inspect the Premises and perform such additional
procedures as may be deemed reasonably necessary to confirm that the Premises
are, as of the effective date of such surrender or early termination of the
Lease, free from any residual impact from Tenant HazMat Operations. Tenant shall
reimburse Landlord, as Additional Rent, for the actual out-of pocket expense
incurred by Landlord for Landlord's environmental consultant to review and
approve the Surrender Plan and to visit the Premises and verify satisfactory
completion of the same, which cost shall not exceed $2,500. Landlord shall have
the unrestricted right to deliver such Surrender Plan and any report by
Landlord's environmental consultant with respect to the surrender of the
Premises to third parties.

If Tenant shall fail to prepare or submit a Surrender Plan approved by Landlord,
or if Tenant shall fail to complete the approved Surrender Plan, or if such
Surrender Plan, whether or not approved by Landlord, shall fail to adequately
address any residual effect of Tenant HazMat Operations in, on or about the
Premises, Landlord shall have the right to take such actions as Landlord may
deem reasonable or appropriate to assure that the Premises and the Project are
surrendered free from any residual impact from Tenant HazMat Operations, the
cost of which actions shall be reimbursed by Tenant as Additional Rent, without
regard to the limitation set forth in the first paragraph of this Section 28.

Tenant shall Immediately return to Landlord all keys and/or access cards to
parking, the Project, restrooms or all or any portion of the Premises furnished
to or otherwise procured by Tenant. If any such access card or key is lost,
Tenant shall pay to Landlord, at Landlord's election, either the cost of
replacing such lost access card or key or the cost of reprogramming the access
security system in which such access card was used or changing the lock or locks
opened by such lost key. Any Tenant's Property, Alterations and property not so
removed by Tenant as permitted or required herein shall be deemed abandoned and
may be stored, removed, and disposed of by Landlord at Tenant's expense, and
Tenant waives all claims against Landlord for any damages resulting from
Landlord's retention and/or disposition of such property. All obligations of
Tenant hereunder not fully performed as of the termination of the Term,
including the obligations of Tenant under Section 30 hereof, shall survive the
expiration or earlier termination of the Term, including, without limitation,
indemnity obligations, payment obligations with respect to Rent and obligations
concerning the condition and repair of the Premises.

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29.             Waiver of Jury Trial. TO THE EXTENT PERMITTED BY LAW, TENANT AND
LANDLORD WAIVE ANY RIGHT TO TRIAL BY JURY OR TO HAVE A JURY PARTICIPATE IN
RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE, BETWEEN
LANDLORD AND TENANT ARISING OUT OF THIS LEASE OR ANY OTHER INSTRUMENT, DOCUMENT,
OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS
RELATED HERETO.

30.             Environmental Requirements.

(a)              Prohibition/Compliance/Indemnity. Tenant shall not cause or
permit any Hazardous Materials (as hereinafter defined) to be brought upon,
kept, used, stored, handled, treated, generated in or about, or released or
disposed of from, the Premises or the Project in violation of applicable
Environmental Requirements (as hereinafter defined) by Tenant or any Tenant
Party. If Tenant breaches the obligation stated in the preceding sentence, or if
the presence of Hazardous Materials in the Premises during the Term or any
holding over results in contamination of the Premises, the Project or any
adjacent property or if contamination of the Premises, the Project or any
adjacent property by Hazardous Materials brought into, kept, used, stored,
handled, treated, generated in or about, or released or disposed of from, the
Premises by anyone other than Landlord and Landlord's employees, agents and
contractors otherwise occurs during the Term or any holding over, Tenant hereby
indemnifies and shall defend and hold Landlord, its officers, directors,
employees, agents and contractors harmless from any and all actions (Including,
without limitation, remedial or enforcement actions of any kind, administrative
or judicial proceedings, and orders or judgments arising out of or resulting
therefrom), costs, claims, damages (including, without limitation, punitive
damages and damages based upon diminution in value of the Premises or the
Project, or the loss of, or restriction on, use of the Premises or any portion
of the Project), expenses (including, without limitation, attorneys',
consultants' and experts' fees, court costs and amounts paid in settlement of
any claims or actions), fines, forfeitures or other civil, administrative or
criminal penalties, injunctive or other relief (whether or not based upon
personal Injury, property damage, or contamination of, or adverse effects upon,
the environment, water tables or natural resources), liabilities or losses
(collectively, "Environmental Claims") which arise during or after the Term as a
result of such contamination. This indemnification of Landlord by Tenant
includes, without limitation, costs incurred in connection with any
investigation of site conditions or any cleanup, treatment, remedial, removal,
or restoration work required by any federal, state or local Governmental
Authority because of Hazardous Materials present In the air, soil or ground
water above, on, or under the Premises. Without limiting the foregoing, if the
presence of any Hazardous Materials on the Premises, the Building, the Projector
any adjacent property caused or permitted by Tenant or any Tenant Party results
in any contamination of the Premises, the Building, the Project or any adjacent
property. Tenant shall promptly take all actions at its sole expense and in
accordance with applicable Environmental Requirements as are necessary to return
the Premises, the Building, the Project or any adjacent property to the
condition existing prior to the time of such contamination, provided that
Landlord's approval of such action shall first be obtained, which approval shall
not unreasonably be withheld so long as such actions would not potentially have
any material adverse long-term or short-term effect on the Premises, the
Building or the Project. Nothing in Section 28. this Section 30 or any other
provision of this Lease shall be construed to make Tenant liable for, and Tenant
is hereby released by Landlord from, any liability or responsibility for
Hazardous Materials that Tenant can reasonably prove were existing in the
Premises or the Project as of the Commencement Date and which have not been
contributed to or exacerbated by Tenant or any Tenant Party.

(b)              Business. Landlord acknowledges that It is not the intent of
this Section 30 to prohibit Tenant from using the Premises for the Permitted
Use. Tenant may operate its business according to prudent industry practices so
long as the use or presence of Hazardous Materials is strictly and properly
monitored according to all then applicable Environmental Requirements. As a
material inducement to Landlord to allow Tenant to use Hazardous Materials in
connection with its business, Tenant agrees to deliver to Landlord prior to the
Commencement Date a list identifying each type of Hazardous Materials to be
brought upon, kept, used, stored, handled, treated, generated on, or released or
disposed of from, the Premises and setting forth any and all governmental
approvals or permits required in connection with the presence, use, storage,
handling, treatment, generation, release or disposal of such Hazardous Materials
on or from the Premises ("Hazardous Materials List"). Tenant shall deliver to
Landlord an updated Hazardous Materials List at least once per calendar year
listing all Hazardous Materials which Tenant is required to disclose to any
Governmental Authority (e.g., the fire department) in connection with its use or
occupancy of the Premises. Tenant shall deliver to Landlord true and correct
copies of the following documents (the "Haz Mat Documents") relating to the use,
storage, handling, treatment, generation, release or disposal of Hazardous
Materials prior to the Commencement Date, or if unavailable at that time,
concurrent with the receipt from or submission to a Governmental Authority:
permits; approvals; reports and correspondence; storage and management plans,
notice of violations of any Legal Requirements; plans relating to the
installation of any storage tanks to be installed In or under the Project
(provided, said installation of tanks shall only be permitted after Landlord has
given Tenant its written consent to do so, which consent may be withheld in
Landlord's sole and absolute discretion); all closure plans or any other
documents required by any and all federal, state and local Governmental
Authorities for any storage tanks installed in, on or under the Project for the
closure of any such tanks; and a Surrender Plan (to the extent surrender In
accordance with Section 28 cannot be accomplished in 3 months). Tenant is not
required, however, to provide Landlord with any portion(s) of the Haz Mat
Documents containing information of a proprietary nature which, in and of
themselves, do not contain a reference to any Hazardous Materials or hazardous
activities. It Is not the intent of this Section to provide Landlord with
information which could be detrimental to Tenant's business should such
information become possessed by Tenant's competitors.

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(c)               Tenant Representation and Warranty. Tenant hereby represents
and warrants to Landlord that (i) neither Tenant nor any of its legal
predecessors has been required by any prior landlord, lender or Governmental
Authority at any time to take remedial action in connection with Hazardous
Materials contaminating a property which contamination was permitted by Tenant
of such predecessor or resulted from Tenant's or such predecessor's action or
use of the property in question, and (ii) Tenant is not subject to any
enforcement order issued by any Governmental Authority in connection with the
use, storage, handling, treatment, generation, release or disposal of Hazardous
Materials (including, without limitation, any order related to the failure to
make a required reporting to any Governmental Authority), If Landlord determines
that this representation and warranty was not true as of the date of this lease,
Landlord shall have the right to terminate this Lease in Landlord's sole and
absolute discretion.

(d)              Testing. Landlord shall have the right to conduct annual tests
of the Premises to determine whether any contamination of the Premises or the
Project has occurred as a result of Tenant's use. Tenant shall be required to
pay the cost of such annual test of the Premises; provided, however, that if
Tenant conducts its own tests of the Premises using third party contractors and
test procedures acceptable to Landlord which tests are certified to Landlord,
Landlord shall accept such tests in lieu of the annual tests to be paid for by
Tenant. In addition, at any time, and from time to time, prior to the expiration
or earlier termination of the Term, Landlord shall have the right to conduct
appropriate tests of the Premises and the Project to determine if contamination
has occurred as a result of Tenant's use of the Premises. In connection with
such testing, upon the request of Landlord, Tenant shall deliver to Landlord or
its consultant such non-proprietary information concerning the use of Hazardous
Materials in or about the Premises by Tenant or any Tenant Party. If
contamination has occurred for which Tenant is liable under this Section 30,
Tenant shall pay all costs to conduct such tests. If no such contamination is
found, Landlord shall pay the costs of such tests (which shall not constitute an
Operating Expense). Landlord shall provide Tenant with a copy of all third
party, non-confidential reports and tests of the Premises made by or on behalf
of Landlord during the Term without representation or warranty and subject to a
confidentiality agreement. Tenant shall, at its sole cost and expense, promptly
and satisfactorily remediate any environmental conditions identified by such
testing in accordance with all Environmental Requirements. Landlord's receipt of
or satisfaction with any environmental assessment in no way waives any rights
which Landlord may have against Tenant.

(e)               Underground Tanks. If underground or other storage tanks
storing Hazardous Materials located on the Premises or the Project are used by
Tenant or are hereafter placed on the Premises or the Project by Tenant, Tenant
shall install, use, monitor, operate, maintain, upgrade and manage such storage
tanks, maintain appropriate records, obtain and maintain appropriate insurance,
implement reporting procedures, properly close any underground storage tanks,
and take or cause to be taken all other actions necessary or required under
applicable state and federal Legal Requirements, as such now exists or may
hereafter be adopted or amended in connection with the installation, use,
maintenance, management, operation, upgrading and closure of such storage tanks.

28

 

(f)               Tenant's Obligations. Tenant's obligations under this Section
30 shall survive the expiration or earlier termination of the Lease. During any
period of time after the expiration or earlier termination of this Lease
required by Tenant or Landlord to complete the removal from the Premises of any
Hazardous Materials (Including, without limitation, the release and termination
of any licenses or permits restricting the use of the Premises and the
completion of the approved Surrender Plan), Tenant shall continue to pay the
full Rent In accordance with this Lease for any portion of the Premises not
relet by Landlord in Landlord's sole discretion, which Rent shall be prorated
daily.

(g)              Definitions. As used herein, the term "Environmental
Requirements" means all applicable present and future statutes, regulations,
ordinances, rules, codes, judgments, orders or other similar enactments of any
Governmental Authority regulating or relating to health, safety, or
environmental conditions on, under, or about the Premises or the Project, or the
environment, including without limitation, the following: the Comprehensive
Environmental Response, Compensation and Liability Act; the Resource
Conservation and Recovery Act; and all state and local counterparts thereto, and
any regulations or policies promulgated or issued thereunder. As used herein,
the term "Hazardous Materials" means and includes any substance, material,
waste, pollutant, or contaminant listed or defined as hazardous or toxic, or
regulated by reason of its impact or potential Impact on humans, animals and/or
the environment under any Environmental Requirements, asbestos and petroleum,
including crude oil or any fraction thereof, natural gas liquids, liquefied
natural gas, or synthetic gas usable for fuel (or mixtures of natural gas and
such synthetic gas). As defined in Environmental Requirements, Tenant is and
shall be deemed to be the "operator" of Tenant's "facility" and the "owner" of
all Hazardous Materials brought on the Premises by Tenant or any Tenant Party,
and the wastes, by-products, or residues generated, resulting, or produced
therefrom.

31.             Tenant's Remedies/Limitation of Liability. Landlord shall not be
In default hereunder unless Landlord fails to perform any of its obligations
hereunder within 30 days after written notice from Tenant specifying such
failure (unless such performance will, due to the nature of the obligation,
require a period of time in excess of 30 days, then after such period of time as
is reasonably necessary). Upon any default by Landlord, Tenant shall give notice
by registered or certified mail to any Holder of a Mortgage covering the
Premises and to any landlord of any lease of property in or on which the
Premises are located and Tenant shall offer such Holder and/or landlord a
reasonable opportunity to cure the default, including time to obtain possession
of the Project by power of sale or a judicial action if such should prove
necessary to effect a cure; provided Landlord shall have furnished to Tenant in
writing the names and addresses of all such persons who are to receive such
notices. All obligations of Landlord hereunder shall be construed as covenants,
not conditions; and, except as may be otherwise expressly provided in this
Lease, Tenant may not terminate this Lease for breach of Landlord's obligations
hereunder.

All obligations of Landlord under this Lease will be binding upon Landlord only
during the period of its ownership of the Premises and not thereafter. The term
"Landlord" In this Lease shall mean only the owner for the time being of the
Premises. Upon the transfer by such owner of its interest in the Premises, such
owner shall thereupon be released and discharged from all obligations of
Landlord thereafter accruing, but such obligations shall be binding during the
Term upon each new owner for the duration of such owner's ownership.

32.             Inspection and Access. Landlord and its agents, representatives,
and contractors may enter the Premises at any reasonable time upon at least 24
hours advance notice (except in case of emergency where no advance notice will
be required) to inspect the Premises and to make such repairs as may be required
or permitted pursuant to this Lease. Landlord and Landlord's representatives may
enter the Premises during business hours on not less than 48 hours advance
written notice (except in the case of emergencies in which case no such notice
shall be required and such entry may be at any time) for the purpose of
effecting any such repairs, inspecting the Premises, showing the Premises to
prospective purchasers and, during the last year of the Term, to prospective
tenants. Landlord may erect a suitable sign on the Premises stating the Premises
are available to let or that the Project is available for sale. Landlord may
grant easements, make public dedications, designate Common Areas and create
restrictions on or about the Premises, provided that no such easement,
dedication, designation or restriction materially, adversely affects Tenant's
use or occupancy of the Premises for the Permitted Use. At Landlord's request,
Tenant shall execute such instruments as may be necessary for such easements,
dedications or restrictions. Tenant shall at all times, except in the case of
emergencies, have the right to escort Landlord or its agents, representatives,
contractors or guests while the same are in the Premises, provided such escort
does not materially and adversely affect Landlord's access rights hereunder.

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33.             Security. Tenant acknowledges and agrees that security devices
and services, if any, while intended to deter crime may not in given instances
prevent theft or other criminal acts and that Landlord is not providing any
security services with respect to the Premises. Tenant agrees that Landlord
shall not be liable to Tenant for, and Tenant waives any claim against Landlord
with respect to, any loss by theft or any other damage suffered or incurred by
Tenant in connection with any unauthorized entry into the Premises or any other
breach of security with respect to the Premises. Tenant shall be solely
responsible for the personal safety of Tenant's officers, employees, agents,
contractors, guests and invitees while any such person is in, on or about the
Premises and/or the Project. Tenant shall at Tenant's cost obtain insurance
coverage to the extent Tenant desires protection against such criminal acts,

34.             Force Majeure. Landlord shall not be held responsible or liable
for delays in the performance of its obligations hereunder when caused by,
related to, or arising out of acts of God, strikes, lockouts, or other labor
disputes, embargoes, quarantines, weather, national, regional, or local
disasters, calamities, or catastrophes, inability to obtain labor or materials
(or reasonable substitutes therefore) at reasonable costs or failure of, or
inability to obtain, utilities necessary for performance, governmental
restrictions, orders, limitations, regulations, or controls, national
emergencies, delay in issuance or revocation of permits, enemy or hostile
governmental action, terrorism, insurrection, riots, civil disturbance or
commotion, fire or other casualty, and other causes or events beyond the
reasonable control of Landlord ("Force Majeure").

35.             Brokers. Landlord and Tenant each represents and warrants that
it has not dealt with any broker, agent or other person (collectively, "Broker")
in connection with this transaction and that no Broker brought about this
transaction. Landlord and Tenant each hereby agree to indemnify and hold the
other harmless from and against any claims by any Broker, other than the broker,
if any named In this Section 35, claiming a commission or other form of
compensation by virtue of having dealt with Tenant or Landlord, as applicable,
with regard to this leasing transaction.

36.             Limitation on Landlord's Liability. NOTWITHSTANDING ANYTHING SET
FORTH HEREIN OR IN ANY OTHER AGREEMENT BETWEEN LANDLORD AND TENANT TO THE
CONTRARY: (A) LANDLORD SHALL NOT BE LIABLE TO TENANT OR ANY OTHER PERSON FOR
(AND TENANT AND EACH SUCH OTHER PERSON ASSUME ALL RISK OF) LOSS, DAMAGE OR
INJURY, WHETHER ACTUAL OR CONSEQUENTIAL TO: TENANT'S PERSONAL PROPERTY OF EVERY
KIND AND DESCRIPTION, INCLUDING, WITHOUT LIMITATION TRADE FIXTURES, EQUIPMENT,
INVENTORY, SCIENTIFIC RESEARCH, SCIENTIFIC EXPERIMENTS, LABORATORY ANIMALS,
PRODUCT, SPECIMENS, SAMPLES, AND/OR SCIENTIFIC, BUSINESS, ACCOUNTING AND OTHER
RECORDS OF EVERY KIND AND DESCRIPTION KEPT AT THE PREMISES AND ANY AND ALL
INCOME DERIVED OR DERIVABLE THEREFROM; (B) THERE SHALL BE NO PERSONAL RECOURSE
TO LANDLORD FOR ANY ACT OR OCCURRENCE IN, ON OR ABOUT THE PREMISES OR ARISING IN
ANY WAY UNDER THIS LEASE OR ANY OTHER AGREEMENT BETWEEN LANDLORD AND TENANT WITH
RESPECT TO THE SUBJECT MATTER HEREOF AND ANY LIABILITY OF LANDLORD HEREUNDER
SHALL BE STRICTLY LIMITED SOLELY TO LANDLORD'S INTEREST IN THE PROJECT OR ANY
PROCEEDS FROM SALE OR CONDEMNATION THEREOF AND ANY INSURANCE PROCEEDS PAYABLE IN
RESPECT OF LANDLORD'S INTEREST IN THE PROJECT OR IN CONNECTION WITH ANY SUCH
LOSS; AND (C) IN NO EVENT SHALL ANY PERSONAL LIABILITY BE ASSERTED AGAINST
LANDLORD IN CONNECTION WITH THIS LEASE NOR SHALL ANY RECOURSE BE HAD TO ANY
OTHER PROPERTY OR ASSETS OF LANDLORD OR ANY OF LANDLORD'S OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS OR CONTRACTORS. UNDER NO CIRCUMSTANCES SHALL LANDLORD OR ANY
OF LANDLORD'S OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR CONTRACTORS BE LIABLE
FOR INJURY TO TENANT'S BUSINESS OR FOR ANY LOSS OF INCOME OR PROFIT THEREFROM.

37. Severability. If any clause or provision of this Lease is illegal, invalid
or unenforceable under present or future laws, then and in that event, it is the
intention of the parties hereto that the remainder of this Lease shall not be
affected thereby. It is also the Intention of the parties to this Lease that in
lieu of each clause or provision of this Lease that is Illegal, invalid or
unenforceable, there be added, as a part of this Lease, a clause or provision as
similar in effect to such illegal, invalid or unenforceable clause or provision
as shall be legal, valid and enforceable.

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38.             Signs; Exterior Appearance. Tenant shall not, without the prior
written consent of Landlord, which may be granted or withheld in Landlord's sole
discretion: (i) attach any awnings, exterior lights, decorations, balloons,
flags, pennants, banners, painting or other projection to any outside wall of
the Project, (ii) use any curtains, blinds, shades or screens other than
Landlord's standard window coverings, (Hi) coat or otherwise sunscreen the
interior or exterior of any windows, (iv) place any bottles, parcels, or other
articles on the window sills, (v) place any equipment, furniture or other items
of personal property on any exterior balcony, or (vi) paint, affix or exhibit on
any part of the Premises or the Project any signs, notices, window or door
lettering, placards, decorations, or advertising media of any type which can be
viewed from the exterior of the Premises. Interior signs on doors and the
directory tablet shall be inscribed, painted or affixed for Tenant by Landlord
at the sole cost and expense of Tenant, and shall be of a size, color and type
acceptable to Landlord. Nothing may be placed on the exterior of corridor walls
or corridor doors other than Landlord's standard lettering. The directory tablet
shall be provided exclusively for the display of the name and location of
tenants.

39.             Notification of Asbestos.

(a)              Notification of Asbestos. Landlord hereby notifies Assignee of
the presence of asbestos-containing materials ("ACMs") and/or presumed
asbestos-containing materials ("PACMs") within or about the Building in the
location Identified in Exhibit H.

(b)              Assignee Acknowledgement. Assignee hereby acknowledges receipt
of the notification in paragraph (a) of this Section 39 and understand that the
purpose of such notification is to make Assignee and any agents, employees, and
contractors of Assignee, aware of the presence of ACMs and/or PACMs within or
about the Building in order to avoid or minimize any damage to or disturbance of
such ACMs and/or PACMs.

Assignee's Initials

(c)              Acknowledgement from Contractors/Employees. Assignee shall give
Landlord at least 14 days' prior written notice before conducting, authorizing
or permitting any of the activities listed below within or about the Building,
and before soliciting bids from any person to perform such services. Such notice
shall Identify or describe the proposed scope, location, date and time of such
activities and the name, address and telephone number of each person who may be
conducting such activities. Thereafter, Assignee shall grant Landlord reasonable
access to the Building, to determine whether any ACMs or PACMs will be disturbed
in connection with such activities. Assignee shall not solicit bids from any
person for the performance of such activities without Landlord's prior written
approval. Upon Landlord's request, Assignee shall deliver to Landlord a copy of
a signed acknowledgement from any contractor, agent, or employee of Assignee
acknowledging receipt of information describing the presence of ACMs and/or
PACMs within or about the Building in the locations identified in Exhibit H
prior to the commencement of such activities. Nothing in this Section 39 shall
be deemed to expand Assignee's rights under the Lease or this Consent or
otherwise to conduct, authorize or permit any such activities.

(i)                Removal of thermal system insulation ("TS1") and surfacing
ACMs and PACMs (i.e., sprayed-on or troweled-on material, e.g., textured ceiling
paint or fireproofing material);

(ii)              Removal of ACMs or PACMs that are not TSI or surfacing ACMs or
PACMs; or

(iii)            Repair and maintenance of operations that are likely to disturb
ACMs or PACMs.

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40.             Miscellaneous.

(a)              Notices. All notices or other communications between the
parties shall be in writing and shall be deemed duly given upon delivery or
refusal to accept delivery by the addressee thereof if delivered In person, or
upon actual receipt if delivered by reputable overnight guaranty courier,
addressed and sent to the parties at their addresses set forth above. Landlord
and Tenant may from time to time by written notice to the other designate
another address for receipt of future notices.

(b)              Joint and Several Liability. If and when included within the
term "Tenant," as used in this instrument, there is more than one person or
entity, each shall be jointly and severally liable for the obligations of
Tenant.

(c)               Financial Information. Tenant shall furnish Landlord with true
and complete copies of (i) Tenant's most recent audited annual financial
statements within 90 days of the end of each of Tenant's fiscal years during the
Term, (ii) Tenant's most recent unaudited quarterly financial statements within
45 days of the end of each of Tenant's first three fiscal quarters of each of
Tenant's fiscal years during the Term, (iii) at Landlord's request from time to
time, updated business plans, including cash flow projections and/or pro forma
balance sheets and income statements, all of which shall be treated by Landlord
as confidential information belonging to Tenant, (iv) corporate brochures and/or
profiles prepared by Tenant for prospective investors, and (v) any other
financial information or summaries that Tenant typically provides to its lenders
or shareholders.

(d)              Recordation. Neither this Lease nor a memorandum of lease shall
be filed by or on behalf of Tenant in any public record. Landlord may prepare
and file, and upon request by Landlord Tenant will execute, a memorandum of
lease.

(e)               Interpretation. The normal rule of construction to the effect
that any ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of this Lease or any exhibits or amendments
hereto. Words of any gender used In this Lease shall be held and construed to
include any other gender, and words in the singular number shall be held to
include the plural, unless the context otherwise requires. The captions inserted
In this Lease are for convenience only and in no way define, limit or otherwise
describe the scope or intent of this Lease, or any provision hereof, or In any
way affect the interpretation of this Lease.

(f)                Not Binding Until Executed. The submission by Landlord to
Tenant of this Lease shall have no binding force or effect, shall not constitute
an option for the leasing of the Premises, nor confer any right or Impose any
obligations upon either party until execution of this Lease by both parties.

(g)               Limitations on Interest. It Is expressly the intent of
Landlord and Tenant at all times to comply with applicable law governing the
maximum rate or amount of any Interest payable on or in connection with this
Lease. If applicable law is ever judicially Interpreted so as to render usurious
any interest called for under this Lease, or contracted for, charged, taken,
reserved, or received with respect to this Lease, then it is Landlord's and
Tenant's express intent that all excess amounts theretofore collected by
Landlord be credited on the applicable obligation (or, if the obligation has
been or would thereby be paid in full, refunded to Tenant), and the provisions
of this Lease Immediately shall be deemed reformed and the amounts thereafter
collectible hereunder reduced, without the necessity of the execution of any new
document, so as to comply with the applicable law, but so as to permit the
recovery of the fullest amount otherwise called for hereunder.

(h)              Choice of Law. Construction and interpretation of this Lease
shall be governed by the internal laws of the state in which the Premises are
located, excluding any principles of conflicts of laws.

(I)                  Time. Time is of the essence as to the performance of
Tenant's obligations under this Lease.

32

 

(j) Incorporation by Reference. All exhibits and addenda attached hereto are
hereby incorporated into this Lease and made a part hereof. If there Is any
conflict between such exhibits or addenda and the terms of this Lease, such
exhibits or addenda shall control.

(k) Entire Agreement. This Lease, including the exhibits attached hereto, and
the Letter Agreement constitute the entire agreement between Landlord and Tenant
pertaining to the subject matter hereof and supersede all prior and
contemporaneous agreements, understandings, letters of intent, negotiations and
discussions, whether oral or written, of the parties, and there are no
warranties, representations or other agreements, express or implied, made to
either party by the other party in connection with the subject matter hereof
except as specifically set forth herein.

(I) Hazardous Activities. Notwithstanding any other provision of this Lease,
Landlord, for itself and its employees, agents and contractors, reserves the
right to refuse to perform any repairs or services in any portion of the
Premises which, pursuant to Tenant's routine safety guidelines, practices or
custom or prudent industry practices, require any form of protective clothing or
equipment other than safety glasses. In any such case, Tenant shall contract
with parties who are acceptable to Landlord, in Landlord's reasonable
discretion, for all such repairs and services, and Landlord shall, to the extent
required, equitably adjust Tenant's Share of Operating Expenses in respect of
such repairs or services to reflect that Landlord is not providing such repairs
or services to Tenant.

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the day
and year first above written.

TENANT:

JUVARIS BIOTHERAPEUTICS, INC.,

a Delaware corporation

 

 

By:

Its:

 

LANDLORD:

ARE-819/863 MITTEN ROAD, LLC,

a Delaware limited liability company

 

By: ALEXANDRIA REAL ESTATE EQUITIES, L.P.,

a Delaware limited partnership,

managing member

 

By: ARE-QRS CORP.,

a Maryland corporation,

general partner

 

By:

Name:

Title:

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EXHIBIT A TO LEASE

DESCRIPTION OF PREMISES

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EXHIBIT B TO LEASE

DESCRIPTION OF PROJECT

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EXHIBIT C TO LEASE

INTENTIONALLY OMITTED

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EXHIBIT D TO LEASE

ACKNOWLEDGMENT OF COMMENCEMENT DATE

This ACKNOWLEDGMENT OF COMMENCEMENT DATE is made this day of 2011, between
ARE-819/863 MITTEN ROAD, LLC, a Delaware limited liability company ("Landlord"),
and JUVARIS BIOTHERAPEUTICS, INC., a Delaware corporation ("Tenant"), and is
attached to and made a part of the Lease dated February 16, 2007 (the "Lease"),
by and between Landlord and Tenant. Any initially capitalized terms used but not
defined herein shall have the meanings given them in the Lease.

Landlord and Tenant hereby acknowledge and agree, for all purposes of the Lease,
that the Commencement Date of the Base Term of the Lease is , 2011, and the
termination date of the Base Term of the Lease shall be midnight on February 29,
2012.

IN WITNESS WHEREOF, Landlord and Tenant have executed this ACKNOWLEDGMENT OF
COMMENCEMENT DATE to be effective on the date first above written.

TENANT:

 

JUVARIS BIOTHERAPEUTICS, INC.,

a Delaware corporation

 

 

By:

Its:

 

LANDLORD:

ARE-819/863 MITTEN ROAD, LLC,

a Delaware limited liability company

 

By: ALEXANDRIA REAL ESTATE EQUITIES, L.P.,

a Delaware limited partnership, managing member

 

By: ARE-QRS CORP.,

a Maryland corporation,

general partner

 

By:

Name:

Title:

 

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EXHIBIT E TO LEASE

Rules and Regulations

1.           The sidewalk, entries, and driveways of the Project shall not be
obstructed by Tenant, or any Tenant Party, or used by them for any purpose other
than ingress and egress to and from the Premises.

2.           Tenant shall not place any objects, including antennas, outdoor
furniture, etc., in the parking areas, landscaped areas or other areas outside
of its Premises, or on the roof of the Project.

3.           Except for animals assisting the disabled, no animals shall be
allowed in the offices, halls, or corridors In the Project.

4.           Tenant shall not disturb the occupants of the Project or adjoining
buildings by the use of any radio or musical instrument or by the making of loud
or Improper noises.

5.           If Tenant desires telegraphic, telephonic or other electric
connections in the Premises, Landlord or its agent will direct the electrician
as to where and how the wires may be introduced; and, without such direction, no
boring or cutting of wires will be permitted. Any such installation or
connection shall be made at Tenant's expense.

6.           Tenant shall not Install or operate any steam or gas engine or
boiler, or other mechanical apparatus In the Premises, except as specifically
approved in the Lease. The use of oil, gas or inflammable liquids for heating,
lighting or any other purpose is expressly prohibited. Explosives or other
articles deemed extra hazardous shall not be brought into the Project.

7.           Parking any type of recreational vehicles is specifically
prohibited on or about the Project. Except for the overnight parking of
operative vehicles, no vehicle of any type shall be stored in the parking areas
at any time. In the event that a vehicle is disabled, It shall be removed within
48 hours. There shall be no "For Sale" or other advertising signs on or about
any parked vehicle. All vehicles shall be parked in the designated parking areas
in conformity with ail signs and other markings. All parking will be open
parking, and no reserved parking, numbering or lettering of individual spaces
will be permitted except as specified by Landlord.

8.           Tenant shall maintain the Premises free from rodents, insects and
other pests.

9.           Landlord reserves the right to exclude or expel from the Project
any person who, in the judgment of Landlord, is intoxicated or under the
influence of liquor or drugs or who shall in any manner do any act in violation
of the Rules and Regulations of the Project.

10.        Tenant shall not cause any unnecessary labor by reason of Tenant's
carelessness or indifference in the preservation of good order and cleanliness.
Landlord shall not be responsible to Tenant for any loss of property on the
Premises, however occurring, or for any damage done to the effects of Tenant by
the janitors or any other employee or person.

11.        Tenant shall give Landlord prompt notice of any defects in the water,
lawn sprinkler, sewage, gas pipes, electrical lights and fixtures, heating
apparatus, or any other service equipment affecting the Premises.

12.        Tenant shall not permit storage outside the Premises, including
without limitation, outside storage of trucks and other vehicles, or dumping of
waste or refuse or permit any harmful materials to be placed In any drainage
system or sanitary system in or about the Premises.

13.        AH moveable trash receptacles provided by the trash disposal firm for
the Premises must be kept in the trash enclosure areas, if any, provided for
that purpose.

14.        No auction, public or private, will be permitted on the Premises or
the Project.

15.        No awnings shall be placed over the windows In the Premises except
with the prior written consent of Landlord.

16.        The Premises shall not be used for lodging, sleeping or cooking or
for any immoral or illegal purposes or for any purpose other than that specified
in the Lease. No gaming devices shall be operated in the Premises.

17.        Tenant shall ascertain from Landlord the maximum amount of electrical
current which can safely be used in the Premises, taking into account the
capacity of the electrical wiring in the Project and the Premises and the needs
of other tenants, and shall not use more than such safe capacity. Landlord's
consent to the installation of electric equipment shall not relieve Tenant from
the obligation not to use more electricity than such safe capacity.

18.        Tenant assumes full responsibility for protecting the Premises from
theft, robbery and pilferage.

19.        Tenant shall not install or operate on the Premises any machinery or
mechanical devices of a nature not directly related to Tenant's ordinary use of
the Premises and shall keep all such machinery free of vibration, noise and air
waves which may be transmitted beyond the Premises.

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