Exhibit 10.1

 

 

 

 

 

 

LEASE AGREEMENT BETWEEN LAS CIMAS OWNER LP,

AS LANDLORD, AND

 

AEGLEA BIOTHERAPEUTICS, INC. AS TENANT

 

DATED APRIL 30, 2019

 

 

LAS CIMAS III AUSTIN, TEXAS

 

 

 

 

 

THIS DOCUMENT IS A DRAFT DOCUMENT FOR DISCUSSION PURPOSES ONLY AND SHALL NOT BE
DEEMED TO BE CONTRACTUALLY BINDING IN ANY WAY ON ANY PERSON (AN "APPLICABLE
PERSON") UNTIL FULLY EXECUTED. THIS DOCUMENT DOES NOT OBLIGATE ANY APPLICABLE
PERSON TO NEGOTIATE IN GOOD FAITH OR TO PROCEED TO COMPLETION AND EXECUTION OF A
FINAL AGREEMENT. NO APPLICABLE PERSON HAS OR SHALL HAVE ANY CLAIM AGAINST ANY
OTHER APPLICABLE PERSON IN CONNECTION WITH THIS DOCUMENT OR THE NEGOTIATION
THEREOF.

 

 

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BASIC LEASE INFORMATION

Lease Date:

April 30, 2019

Landlord:

LAS CIMAS OWNER LP, a Delaware limited partnership Tenant:

AEGLEA BIOTHERAPEUTICS, INC., a Delaware corporation

Building:

The office building commonly known as Las Cimas III and whose street address is
805 Las Cimas Parkway, Austin, Texas 78746. The land on which the Building is
located  (the "Land") is described on Exhibit B. The term "Project" shall
collectively refer to the  Building, the Land and the driveways, parking
facilities, and similar improvements and easements associated with the foregoing
or the operation thereof.

Premises:

Suite No. 100, 110, and 150 for a total of 30,026 rentable square feet in the
Building. The Premises are outlined on the plan attached to the Lease as Exhibit
A.

Lab Area:

The portion of the Premises identified on Exhibit A as the "Lab Area".

Term:

Starting on the Commencement Date and ending at 5:00 p.m. local time on April
30, 2028, subject to adjustment and earlier termination as provided in the
Lease.

Commencement Date:

The Lease Date.

Basic Rent:

Subject to the conditional abatement of Basic Rent contained in Exhibit I
hereto, Basic Rent shall be the following amounts for the following periods of
time:

 

Annual Rent

Lease Month

Annual Basic Rent

for Suite 100 & 110

Annual Basic Rent for Suite 150

Total Annual

Basic Rent for the Premises

1-12

$611,785.00

$319,021.00

$930,806.00

13 - 24

$630,138.55

$328,591.63

$958,730.18

25 - 36

$649,042.71

$338,449.38

$987,492.09

37 - 48

$668,513.99

$348,602.86

$1,017,116.85

49 - 60

$688,569.41

$359,060.95

$1,047,630.35

61-72

$709,226.49

$369,832.77

$1,079,059.26

73-84

$730,503.28

$380,927.76

$1,111,431.04

85-96

$752,418.38

$392,355.59

$1,144,773.97

97-108

$774,990.93

$404,126.26

$1,179,117.19

109+

$798,240.66

$416,250.05

$1,214,490.71

 

Monthly Rent

Lease Month

Monthly Basic

Rent for Suite 100 & 110

Monthly Basic Rent for Suite 150

Total Monthly

Basic Rent for the Premises

1-12

$50,982.08

$26,585.08

$77,567.17

13 - 24

$52,511.55

$27,382.64

$79,894.18

25 - 36

$54,086.89

$28,204.11

$82,291.01

37 - 48

$55,709.50

$29,050.24

$84,759.74

49 - 60

$57,380.78

$29,921.75

$87,302.53

61-72

$59,102.21

$30,819.40

$89,921.61

73-84

$60,875.27

$31,743.98

$92,619.25

85-96

$62,701.53

$32,696.30

$95,397.83

97-108

$64,582.58

$33,677.19

$98,259.77

109+

$66,520.06

$34,687.50

$101,207.56

 

As used herein, the term "Lease Month" means each calendar month during the Term
(and if the Commencement Date does not occur on the first day of a calendar
month, the period from the Commencement Date to the first day of the next
calendar month shall be included in the first Lease Month for purposes of
determining the duration of the Term and the monthly Basic Rent rate applicable
for such partial month).

i

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Letter of Credit Amount:

ONE MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($1,500,000), subject to
reduction per the terms of the Lease.

Rent:

Basic Rent, Tenant's Proportionate Share of Taxes and Electrical Costs, Tenant's
share of Additional Rent, and all other sums that Tenant may owe to Landlord or
otherwise be required to pay under the Lease.

Permitted Use:

General administrative and executive office uses commensurate with the first
class quality and character of the Building, subject to applicable law, and only
as it relates to the Lab Area, use as a "light" laboratory for research and
development, the parameters of such use more particularly described in Exhibit
J, and for no other purpose or purposes.

Tenant's Proportionate Share:

19.21%

 

Tenant's Address:

Prior to Commencement Date:

Following Commencement Date:

 

AEGLEA BIOTHERAPEUTICS, INC.

901 Mopac Expressway South

Bldg 1 Suite 250

Austin, TX 78746

Attention: Eugene Sackett

Telephone: 512-394-4186

AEGLEA BIOTHERAPEUTICS, INC.

805 Las Cimas Parkway, Suite 100

Austin, Texas 78746

Attention: Eugene Sackett

Telephone: 512-394-4186

 

 

 

Landlord's Address:

For all Notices:

With a copy to:

 

Las Cimas Owner LP

500 Boylston Street, Suite 2100

Boston, Massachusetts 02116

Attention: Kyle Gardner and Joe Goldman

E-mail: KGardner@rockpointgroup.com;

JGoldman@rockpointgroup.com

Las Cimas Owner LP

Woodlawn at Old Parkland

3953 Maple Avenue, Suite 300

Dallas, Texas 75219

Attention: Ron Hoyl

E-mail: RHoyl@rockpointgroup.com

 

The foregoing Basic Lease Information is incorporated into and made a part of
the Lease identified above. If any conflict exists between any Basic Lease
Information and the Lease, then the Lease shall control.

 

 

 

ii

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TABLE OF CONTENTS

 

 

 

 

Page No.

 

1.

DEFINITIONS AND BASIC PROVISIONS

1

 

 

 

 

 

 

2.

LEASE GRANT

1

 

 

 

 

 

 

3.

TENDER OF POSSESSION; EARLY ENTRY BY TENANT

1

 

 

 

 

 

 

4.

RENT

1

 

 

(a)

Payment

1

 

 

(b)

Operating Costs; Taxes; Electrical Costs

1

 

 

(c)

Operating Costs Cap

4

 

 

 

 

 

 

5.

DELINQUENT PAYMENT; HANDLING CHARGES

4

 

 

 

 

 

 

6.

SECURITY DEPOSIT

4

 

 

 

 

 

 

7.

LANDLORD'S OBLIGATIONS

4

 

 

(a)

Services

4

 

 

(b)

Excess Utility Use

4

 

 

(c)

Restoration of Services

5

 

 

(d)

Access

5

 

 

 

 

 

 

8.

IMPROVEMENTS; ALTERATIONS; REPAIRS; MAINTENANCE

5

 

 

(a)

Improvements; Alterations

5

 

 

(b)

Repairs; Maintenance

7

 

 

(c)

Performance of Work

7

 

 

(d)

Mechanic's Liens

7

 

 

 

 

 

 

9.

USE AND COMPLIANCE WITH LAW

8

 

 

(a)

Use

8

 

 

(b)

Compliance with Law

8

 

 

(c)

Lab Area

8

 

 

 

 

 

 

10.

ASSIGNMENT AND SUBLETTING

11

 

 

(a)

Transfers

11

 

 

(b)

Consent Standards

12

 

 

(c)

Request for Consent

12

 

 

(d)

Conditions to Consent

12

 

 

(e)

Attornment by Subtenants

12

 

 

(f)

Cancellation

13

 

 

(g)

Additional Compensation

13

 

 

(h)

Permitted Transfers

13

 

 

 

 

 

 

11.

INSURANCE; WAIVERS; SUBROGATION; INDEMNITY

14

 

 

(a)

Tenant's Insurance

14

 

 

(b)

General Provisions

14

 

 

(c)

No Subrogation; Waiver of Property Claims

15

 

 

(d)

Indemnity

15

 

 

 

 

 

 

12.

SUBORDINATION; ATTORNMENT; NOTICE TO LANDLORD'S MORTGAGEE

16

 

 

(a)

Subordination

16

 

 

(b)

Attornment

16

 

 

(c)

Notice to Landlord's Mortgagee

16

 

iii

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(d)

Landlord's Mortgagee's Protection Provisions

16

 

 

 

 

 

 

13.

RULES AND REGULATIONS

17

 

 

 

 

 

 

14.

CONDEMNATION

17

 

 

(a)

Total Taking

17

 

 

(b)

Partial Taking - Tenant's Rights

17

 

 

(c)

Partial Taking - Landlord's Rights

17

 

 

(d)

Temporary Taking

17

 

 

(e)

Award

17

 

 

 

 

 

 

15.

FIRE OR OTHER CASUALTY

17

 

 

(a)

Repair Estimate

17

 

 

(b)

Tenant's Rights

17

 

 

(c)

Landlord's Rights

18

 

 

(d)

Repair Obligation

18

 

 

(e)

Abatement of Rent

18

 

 

(f)

Lab Lab Area

18

 

 

 

 

 

 

16.

PERSONAL PROPERTY TAXES

18

 

 

 

 

 

 

17.

EVENTS OF DEFAULT

18

 

 

(a)

Payment Default

18

 

 

(b)

Abandonment

19

 

 

(c)

Estoppel

19

 

 

(d)

Insurance

19

 

 

(e)

Mechanic's Liens

19

 

 

(f)

Other Defaults

19

 

 

(g)

Insolvency

19

 

 

 

 

 

 

18.

REMEDIES

19

 

 

(a)

Termination of Lease

19

 

 

(b)

Termination of Possession

19

 

 

(c)

Perform Acts on Behalf of Tenant

20

 

 

(d)

Suspension of Services

20

 

 

(e)

Alteration of Locks

20

 

 

 

 

 

 

19.

PAYMENT BY TENANT; NON-WAIVER; CUMULATIVE REMEDIES

20

 

 

(a)

Payment by Tenant

20

 

 

(b)

No Waiver

20

 

 

(c)

Cumulative Remedies

20

 

 

 

 

 

 

20.

LANDLORD'S LIEN

20

 

 

 

 

 

 

21.

SURRENDER OF PREMISES

21

 

 

(a)

General Surrender Provisions

21

 

 

(b)

Lab Area Surrender

21

 

 

 

 

 

 

22.

HOLDING OVER

22

 

 

 

 

 

 

23.

CERTAIN RIGHTS RESERVED BY LANDLORD

22

 

 

(a)

Building Operations

22

 

 

(b)

Security

22

 

 

(c)

Prospective Purchasers and Lenders

22

 

 

(d)

Prospective Tenants

22

 

 

 

 

 

 

iv

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24.

INTENTIONALLY OMITTED

23

 

 

 

 

 

 

25.

MISCELLANEOUS

23

 

 

(a)

Landlord Transfer

23

 

 

(b)

Landlord's Liability

23

 

 

(c)

Force Majeure

23

 

 

(d)

Brokerage

23

 

 

(e)

Estoppel Certificates

23

 

 

(f)

Notices

23

 

 

(g)

Separability

23

 

 

(h)

Amendments; Binding Effect; No Electronic Records

24

 

 

(i)

Quiet Enjoyment

24

 

 

(j)

No Merger

24

 

 

(k)

No Offer

24

 

 

(l)

Entire Agreement

24

 

 

(m)

Waiver of Jury Trial

24

 

 

(n)

Governing Law

24

 

 

(o)

Recording

24

 

 

(p)

Water or Mold Notification

24

 

 

(q)

Joint and Several Liability

24

 

 

(r)

Financial Reports

24

 

 

(s)

Landlord's Fees

25

 

 

(t)

Telecommunications

25

 

 

(u)

Confidentiality

25

 

 

(v)

Authority

25

 

 

(w)

Hazardous Materials

25

 

 

(x)

List of Exhibits

26

 

 

(y)

Determination of Charges

26

 

 

(z)

Prohibited Persons and Transactions

26

 

 

 

 

 

 

26.

LETTER OF CREDIT

26

 

 

(a)

General Provisions

26

 

 

(b)

Drawings under Letter of Credit

27

 

 

(c)

Use of Proceeds by Landlord

27

 

 

(d)

Additional Covenants of Tenant

27

 

 

(e)

Transfer of Letter of Credit

27

 

 

(f)

Reduction in Letter of Credit Amount

28

 

 

(g)

Nature of Letter of Credit

28

 

 

 

 

 

 

27.

OTHER PROVISIONS

28

 

 

(a)

Monument Sign

28

 

 

(b)

Lab Area Cleaning Services

28

 

 

 

 

 

v

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LIST OF DEFINED TERMS

Page No.

 

 

Additional Rent

1

Affiliate

1

Applicable Requirements

9

Basic Lease Information

1

Basic Rent

i

Building

i

Building's Structure

1

Building's Systems

1

Casualty

17

Certificates

15

Code Modification

8

Collateral

20

Commencement Date

i

Complex

2

Controllable Operating Costs

4

Cure Period

11

Damage Notice

17

Default Rate

4

Electrical Costs

3

Event of Default

18

GAAP

13

Hazardous Materials

25

Hazardous Materials Laws

10

Hazardous Materials List

10

HVAC

4

including

1

Issuing Bank

26

Labor Disruption

6

Land

i

Landlord

1

LANDLORD INDEMNITEES

11

Landlord's Mortgagee

16

Law

1

Laws

1

Lease

1

Lease Month

i

Letter of Credit

26

Loss

16

Medical Equipment

9

Monument Sign

28

Mortgage

16

Non-Renewal Notices

 

26

OFAC

12

Operating Costs

2

Operating Costs and Tax Statement.

3

Parking Area

1

Permitted Transfer

13

Permitted Transferee

13

Permitted Use

ii

Premises

i

Primary Lease

16

Project

i

Renewal Rental Rate

1

Rent

ii

vi

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Repair Period

17

Security Deposit Laws

28

Taking

17

Tangible Net Worth

13

Taxes

2

Telecommunications Services

25

Tenant

1

Tenant Party

1

Tenant's Off-Premises Equipment

1

Tenant's Proportionate Share

ii

Term

i

Transfer

11

Typical Office Trash

9

UCC

20

 

 

 

vii

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LEASE

This Lease Agreement (this "Lease") is entered into as of April 30, 2019,
between LAS CIMAS OWNER LP, a Delaware limited partnership ("Landlord"), and
AEGLEA BIOTHERAPEUTICS, INC., a Delaware corporation ("Tenant").

 

1.Definitions and Basic Provisions. The definitions and basic provisions set
forth in the Basic Lease Information (the "Basic Lease Information") set forth
above are incorporated herein by reference for all purposes. Additionally, the
following terms shall have the following meanings when used in
this  Lease:  "Affiliate" means any person or entity which, directly or
indirectly, controls, is controlled by, or is under common control with the
party in question; "Building's Structure" means the Building's exterior walls,
roof, elevator  shafts, footings, foundations, structural portions of
load-bearing walls, structural floors and subfloors, and  structural columns and
beams; "Building's Systems" means the Building's HVAC, life-safety, plumbing,
electrical, and mechanical systems; "including" means including, without
limitation; "Laws" means all federal, state, and local laws, ordinances, rules
and regulations, all court orders, governmental directives, and governmental
orders and all interpretations of the foregoing, and all restrictive covenants
affecting this Lease or the Project, and "Law" means any of the foregoing;
"Tenant's Off-Premises Equipment" means any of Tenant's equipment or other
property that may be located on or about the Project (other than inside the
Premises); and "Tenant Party" means any of the following persons: Tenant; any
assignees claiming by, through, or under Tenant; any subtenants claiming by,
through, or under Tenant; and any of their respective agents, contractors,
employees, licensees, guests and invitees.

 

2.Lease Grant. Subject to the terms of this Lease, Landlord leases to Tenant,
and Tenant leases from Landlord, the Premises.

 

3.Tender of Possession. Landlord and Tenant anticipate that possession of the
Premises will be tendered to Tenant in the condition required by this Lease on
the Lease Date. By executing the Lease, Tenant shall be deemed to have accepted
the Premises in its "as-is, where-is" condition as of the Lease Date.

 

4.Rent.

 

(a)Payment. Tenant shall timely pay to Landlord Rent, without notice, demand,
deduction or set off (except as otherwise expressly provided herein), by good
and sufficient check drawn on a national banking association at Landlord's
address provided for in this Lease or as otherwise specified by Landlord and
shall be accompanied by all applicable state and local sales or use taxes. The
obligations of Tenant to pay Rent to Landlord and the obligations of Landlord
under this Lease are independent obligations. Rent shall be payable monthly in
advance. The first monthly installment of Basic Rent shall be payable
contemporaneously with the execution of this Lease; thereafter, Basic Rent shall
be payable on the first day of each month beginning on the first day of the
second Lease Month. The monthly Rent for any partial month at the beginning of
the Term shall equal the product of 1/365 of the annual Basic Rent (and
Additional Rent) in effect during the partial month and the number of days in
the partial month, and shall be due on the Commencement Date. Payments of Rent
for any fractional calendar month at the end of the Term shall be similarly
prorated.

 

(b)Operating Costs; Taxes; Electrical Costs.

 

(1)In addition to Basic Rent, Tenant shall pay to Landlord, as "Additional Rent"
hereunder:    (i) Tenant's Proportionate Share of Operating Costs, as set forth
in Section 4(b)(2), (ii) Tenant's Proportionate Share of Taxes, as set forth in
Section 4(b)(3), and (iii) Tenant's Share of Electrical Costs as set forth in
Section 4(b)(4). Prior to each calendar year of the Term, Landlord shall make a
good faith estimate of the Additional Rent for the following calendar year or
part thereof during the Term. During each calendar year or partial calendar year
of the Term, Tenant shall pay to Landlord, in advance concurrently with each
monthly installment of Basic Rent, an amount equal to the estimated Additional
Rent for such calendar year or part thereof divided by the number of months
therein. From time to time but not more than twice per calendar year, Landlord
may re-estimate the Additional Rent to be due by Tenant and deliver a copy of
the re-estimate to Tenant. Thereafter, the monthly installments of Additional
Rent shall be adjusted in accordance with the estimations so that, by the end of
the calendar year in question, Tenant shall have paid all of the Additional Rent
as estimated by Landlord. Any amounts paid based on such an estimate shall be
subject to adjustment as herein provided when actual Operating Costs are
available for each calendar year.

 

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(2)The term "Operating Costs" means all expenses and disbursements (subject to
the limitations set forth below) that Landlord incurs in connection with the
ownership, operation, management, and maintenance of the Project, including,
without limitation, the following costs: (A) expenses incurred by Landlord or
its agents, including, without limitation, managing agents, which are related to
the employment of property personnel, day and night supervisors, janitors,
handymen, carpenters, engineers, firemen, mechanics, electricians, plumbers,
guards, cleaners, accountants, and other personnel, including, without
limitation, amounts incurred for wages, salaries and other compensation for
services, payroll, social security, unemployment and similar taxes, workmen's
compensation insurance, disability benefits, pensions, hospitalization,
retirement plans and group insurance, telecommunications equipment, uniforms and
working clothes and the cleaning thereof, and expenses imposed on Landlord or
its agents pursuant to any collective bargaining agreement for services in
connection with the operation of the Project; provided, however, that the costs
of employing personnel who work less than full-time in connection with the
operation of the Project shall be equitably adjusted; (B) all supplies and
materials  used in the operation, maintenance, repair, replacement, and security
of the Project; (C) costs for improvements made to the Project which, although
capital in nature, are expected to reduce the normal operating costs (including
all utility costs) of the Project, as amortized using a commercially reasonable
interest rate over the time period reasonably estimated by Landlord to recover
the costs thereof, as determined by Landlord using its good faith, commercially
reasonable judgment, as well as capital improvements made in order to comply
with any Law hereafter promulgated by any governmental authority or any
interpretation hereafter rendered with respect to any existing Law, as amortized
using a commercially reasonable interest rate over the useful economic life of
such improvements as determined by Landlord in its reasonable discretion; (D)
cost of all utilities, except Electrical Costs and the cost of other utilities
reimbursable to Landlord by the Project's tenants other than pursuant to a
provision similar to this Section 4(b); (E) insurance expenses; (F) repairs,
replacements, and general maintenance of the Project; (G) fair market rental and
other direct costs of the management office for the Building; (H) the amounts
paid to managing agents and for reasonable legal and other professional fees
relating to the operation of the Project, but excluding such fees paid in
connection with (x) negotiations for or the enforcement of leases; and (y)
seeking abatement of Taxes; provided, however, that management fees shall not
exceed prevailing market rates; and (I) service, maintenance and management
contracts with independent contractors for the operation, maintenance,
management, repair, replacement, or security of the Project (including alarm
service, window cleaning, and elevator maintenance). If the Building is or
becomes part of a multi-building office complex (the "Complex"), Operating
Costs, Taxes and Electrical Costs for the Complex may be prorated among the
Project and the other buildings of the Complex, as reasonably determined by
Landlord.

 

Operating Costs shall not include costs for (i) capital improvements made to the
Building, other than capital improvements described in Section 4(b)(2)(C) and
except for items which are generally considered maintenance and repair items,
such as painting of common areas, replacement of carpet in elevator lobbies, and
the like; (ii) repair, replacements and general maintenance paid by proceeds of
insurance or by Tenant or other third parties; (iii) interest, amortization or
other payments on loans to Landlord; (iv) depreciation; (v) leasing commissions
and expenses of procuring tenants; (vi) legal expenses for services, other than
those set forth above or that benefit the Project tenants generally (e.g., tax
disputes); (vii) renovating or otherwise improving space for occupants of the
Project or vacant space in the Project; (viii) Taxes; (ix) federal income taxes
imposed on or measured by the income of Landlord from the operation of the
Project; (x) any costs for which Landlord is directly reimbursed by payment from
any other tenants or for which Landlord actually receives insurance proceeds or
warranties; (xi) interest on and amortization of debt; (xiv) costs in connection
with the cleanup or removal of Hazardous Materials; (xvi) salaries and benefits
of personnel above the grade of property manager (or equivalent title); and
(xvii) general and administrative overhead of Landlord not specifically
allocated to the operation, use, maintenance, repair, or ownership of the
Building.

 

(3)Tenant shall also pay Tenant's Proportionate Share of Taxes for each year and
partial year falling within the Term. Tenant shall pay Tenant's Proportionate
Share of Taxes in the same manner as provided above for Tenant's Proportionate
Share of Operating Costs. "Taxes" means taxes, assessments, and governmental
charges or fees whether federal, state, county or municipal, and whether they be
by taxing districts or authorities presently taxing or by others, subsequently
created or otherwise, and any other taxes and assessments (including
non-governmental assessments for common charges under a restrictive covenant or
other private agreement that are not treated as part of Operating Costs) now or
hereafter attributable to the Project or its operation (including the Texas
margin tax and/or any other business tax imposed under Texas Tax Code Chapter
171 and/or any successor statutory provision), excluding, however, penalties and
interest thereon and federal and state taxes on income (if the present method of
taxation changes so that in lieu of or in addition to the whole or any part of
any Taxes, there is levied on Landlord a capital tax directly on the rents
received therefrom or a franchise tax, assessment, or charge based, in whole or
in part, upon such rents for the Project, then all such taxes, assessments,

Page 2

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or charges, or the part thereof so based, shall be deemed to be included within
the term "Taxes" for purposes hereof). Taxes shall include the reasonable costs
of consultants retained in an effort to lower taxes and all costs incurred in
disputing any taxes or in seeking to lower the tax valuation of the Project. For
property tax purposes, Tenant waives all rights to protest or appeal the
appraised value of the Premises, as well as the Project, and all rights to
receive notices of reappraisement.

 

(4)Tenant shall also pay to Landlord Tenant's Proportionate Share of Electrical
Costs. As used herein, "Electrical Costs" means the cost of all electricity used
by the Project, which shall include sales, use, excise or other taxes assessed
by governmental authorities on electrical services supplied to the Project. Such
amount shall be payable in monthly installments on the Commencement  Date and on
the first day of each calendar month thereafter. Each installment shall be based
on Landlord's estimate of the amount due for each month.  From time to time but
not more than once during any  calendar year, Landlord may estimate or
re-estimate the Electrical Costs to be due by Tenant for that calendar year and
deliver a copy of the estimate or re-estimate to Tenant. Thereafter, the monthly
installments of Electrical Costs payable by Tenant shall be appropriately
adjusted in accordance with the estimations.

 

(5)Following year-end, Landlord shall furnish to Tenant a statement of Operating
Costs and Electrical Costs for the previous year, in each case adjusted as
provided in Section 4(b)(6), and of the Taxes for the previous year (the
"Operating Costs and Tax Statement"). If Tenant's estimated payments of
Operating Costs, Electrical Costs or Taxes under this Section 4(b) for the year
covered by the Operating Costs and Tax Statement exceed Tenant's Proportionate
Share of such items as indicated in the Operating Costs and Tax Statement, then
Landlord shall promptly credit or reimburse Tenant for such excess; likewise, if
Tenant's estimated payments of Operating Costs, Electrical Costs or Taxes under
this Section 4(b) for such year are less than Tenant's Proportionate Share of
such items as indicated in the Operating Costs and Tax Statement, then Tenant
shall promptly pay Landlord such deficiency.

 

(6)With respect to any calendar year or partial calendar year in which the
Building is not occupied to the extent of 95% of the rentable area thereof, or
Landlord is not supplying services to 95% of the rentable area thereof, the
Operating Costs for such period which vary with the occupancy of the Building
shall, for the purposes hereof, be increased to the amount which would have been
incurred had the Building been occupied to the extent of 95% of the rentable
area thereof and Landlord had been supplying services to 95% of the rentable
area thereof.

 

(7)Landlord shall maintain books and records reflecting the Operating Costs in
accordance with commercially reasonable accounting and management practices.
Tenant and any independent, third-party certified public accountant engaged and
paid by Tenant (who shall not be paid on a contingency, percentage, bonus,
"success fee", or similar basis) shall have the right to examine such records
not more than once a year upon reasonable prior written notice to Landlord given
no later than one hundred twenty (120) days following the furnishing of the
Operating Costs and Tax Statement or modification thereof, specifying the
records Tenant desires to examine and the basis for Tenant's dispute. Such
examination shall take place during normal business hours at the location where
such records are normally kept, and shall be limited to the records pertaining
to the calendar year addressed by the most recent Operating Costs and Tax
Statement. It is a condition to Tenant's exercise of this audit right that
Tenant shall have paid to Landlord all amounts billed by Landlord to Tenant.
No  later than sixty (60)  days after the date on which Tenant has completed
examination of such records, Tenant may take exception to matters included in
Operating Costs and Tax Statement or Landlord's computation of Tenant's
Proportionate Share thereof (a "Report Exception") by sending written notice to
Landlord specifying the Report Exception and the reasons therefor. The Report
Exception shall not be  determinative and Landlord shall have the right to
dispute the Report Exception. If Tenant timely raises a Report Exception and
Landlord and Tenant, after working together in good faith for a period of thirty
(30) days thereafter, are unable to mutually agree on the resolution thereof,
such exception shall be referred to one of Deloitte & Touche, KPMG, PWC, and
Ernst & Young ("CPA") as selected by Landlord to determine the resolution of the
Report Exception, which determination shall be final and conclusive between
Landlord and Tenant. Landlord shall allow Tenant a credit against rent next due
for the amount  of any overpayment, and Tenant shall pay Landlord the amount of
any underpayment. If the CPA determines that Operating Costs were overstated by
more than five percent (5%), Landlord shall pay the cost of such CPA's
certification, and Tenant's cost of such audit. Except as may be required to
comply with an order from a court or other governmental body of competent
jurisdiction, the results of any examination shall be kept strictly confidential
by Tenant and its certified public accountants, and Tenant and its certified
public accountants must agree in their contract for such services to such
confidentiality restrictions and that the results shall not be revealed to any
other person. As a condition to exercise of any right to examine under this
Section, Tenant must deliver to Landlord, if requested by Landlord, a signed
confidentiality agreement from Tenant and its certified public accountants
reasonably acceptable to Landlord confirming the confidentiality provisions.

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(c)Operating Costs Cap. For purposes of calculating Additional Rent under
Section 4.(b), the maximum increase in the amount of Controllable Operating
Costs (defined below) that may be included in calculating such Additional Rent
for each calendar year after the first lease year shall be limited to 6% per
calendar year on a cumulative, compounded basis. "Controllable Operating Costs"
means all Operating Costs excluding taxes, insurance, utilities, snow removal
costs and other weather-related costs (including extraordinary landscape
maintenance costs, such as those resulting from infestation, storms, drought,
and other severe weather), and costs incurred to comply with governmental
requirements enacted or reinterpreted following the Lease Date, and costs
arising from force majeure.

 

5.Delinquent Payment; Handling Charges. All payments required of Tenant
hereunder not received within five business days of the date due shall bear
interest from the date due until paid at the lesser of twelve percent per annum
or the maximum lawful rate of interest (such lesser amount is referred to herein
as the "Default Rate"). In no event, however, shall the charges permitted under
this Section 5 or elsewhere in this Lease, to the extent they are considered to
be interest under applicable Law, exceed the maximum lawful rate of interest.
Notwithstanding the foregoing, the interest referenced above shall not be
charged with respect to the first two occurrences (but not any subsequent
occurrence) during any 12-month period that Tenant fails to make payment within
five business days of the date due, until five days after Landlord delivers
written notice of such delinquency to Tenant.

 

6.Security Deposit. In lieu of a security deposit, Landlord will require a
Letter of Credit to be delivered and maintained by Tenant in accordance with
Section 26.

 

7.Landlord's Obligations.

 

(a)Services. Landlord shall furnish to Tenant (1) hot and cold water at those
points of supply provided for general use of tenants of the Building; (2) heated
and refrigerated air conditioning ("HVAC") as appropriate for general office
use, at such temperatures and in such amounts as are standard for comparable
office buildings in the vicinity of the Building; (3) subject to Section 27(b),
janitorial service to the Premises on weekdays, other than holidays, for
Building-standard installations and such window washing as may from time to time
be reasonably required; (4) elevators for ingress and egress to the floor on
which the Premises are located, in common with other tenants, provided that
Landlord may reasonably limit the number of operating elevators during non-
business hours and holidays; (5) electrical current during normal business hours
for equipment that does not require more than 110 volts and whose electrical
energy consumption does not exceed normal office usage and (6) a card- key
building access system to the lobby entrances to the Building. If Tenant desires
any of the services specified in Section 7(a)(2): (A) at any time other than
between 7:00 a.m. and 6:00 p.m. on weekdays and between 8:00 a.m.  and 1:00 p.m.
on Saturdays (in each case other than holidays), or (B) on Sunday or holidays,
then such services shall be supplied to Tenant upon the written request of
Tenant delivered to Landlord before 3:00 p.m. on the business day preceding such
extra usage, and Tenant shall pay to Landlord the cost of such services within
30 days after Landlord has delivered to Tenant an invoice therefor. The costs
incurred by Landlord in providing after-hour HVAC service  to Tenant shall
include costs for electricity, water, sewage, water treatment, labor, metering,
filtering, and maintenance reasonably allocated by Landlord to providing such
service. As of the Lease Date, the cost for after- hours HVAC service is $30.00
per hour per zone with a 2-hour minimum. The foregoing rate is subject to
increase based on increased costs to Landlord for providing such after-hours
HVAC service. Subject to and in accordance with Section 8 hereof, Tenant shall,
at Tenant's cost and expense, install any required specialty lighting,
air-handlers, air-scrubbers or other similar fixtures or improvements in the Lab
Area and Tenant shall, at Tenant's cost and expense, be responsible for the
maintenance and repair of such specialty lighting, air-handlers, air-scrubbers
and other similar fixtures and improvements, including, without limitation, the
replacement of tubes, lamps, bulbs and ballasts servicing the same.

 

(b)Excess Utility Use. Landlord shall not be required to furnish electrical
current for equipment that requires more than 110 volts or other equipment whose
electrical energy consumption exceeds normal office usage. If Tenant's
requirements for or consumption of electricity exceed the electricity to be
provided by Landlord as described in Section 7(a), Landlord shall, at Tenant's
expense, make reasonable efforts to supply such service through the
then-existing feeders and risers serving the Building and the Premises, and
Tenant shall pay to Landlord the cost of such service within 30 days after
Landlord has delivered to Tenant an invoice therefor. Landlord may determine the
amount of such additional consumption and potential consumption by any
verifiable method, including installation of a separate meter in the Premises
installed, maintained, and read by Landlord, at Tenant's expense. Tenant shall
not install any electrical equipment requiring special wiring or requiring
voltage in excess of 110 volts unless approved in advance by Landlord, which
approval shall not be unreasonably withheld. Notwithstanding the foregoing,
Landlord approves the installation of equipment in the Lab Area that requires
220 volts provided no more than 12 such pieces of equipment shall be located
therein. Tenant shall not install any electrical equipment requiring voltage in
excess of Building capacity unless approved in advance by Landlord, which
approval may be withheld in Landlord's sole discretion. The use of electricity
in the Premises shall not  exceed the

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capacity of existing feeders and risers to or wiring in the Premises. Any risers
or wiring required to meet Tenant's excess electrical requirements shall, upon
Tenant's written request, be installed by Landlord, at Tenant's cost, if, in
Landlord's judgment, the same are necessary and shall not cause permanent damage
to the Building or the Premises, cause or create a dangerous or hazardous
condition, entail excessive or unreasonable alterations, repairs, or expenses,
or interfere with or disturb other tenants of the Building. If Tenant uses
machines, lighting or equipment in the Premises which affect the temperature
otherwise maintained by the air conditioning system or otherwise overload any
utility, Landlord may install supplemental air conditioning units or other
supplemental equipment in the Premises, and the cost thereof, including the cost
of installation, operation, use, and maintenance, in each case, plus an
administrative fee of 15% of such cost, shall be paid by Tenant to Landlord
within 30 days  after Landlord has delivered to Tenant an invoice therefor.

 

(c)Restoration of Services. Landlord shall use reasonable efforts to restore any
service required of it that becomes unavailable; however, such unavailability
shall not render Landlord liable for any damages caused thereby, be a
constructive eviction of Tenant, constitute a breach of any implied warranty, or
entitle Tenant to any abatement of Tenant's obligations hereunder.
Notwithstanding any other provision to the contrary set forth in this Lease, if
the Premises shall lack any electrical or HVAC service which Landlord is
required to provide hereunder (thereby rendering the Premises or a portion
thereof "untenantable" [as hereinafter defined]) for a period of ten (10)
consecutive business days after Landlord's receipt of written notice from Tenant
of such condition, then provided that (i) such untenantability and Landlord's
inability to cure such condition does not arise out of or result from default or
neglect of Tenant or Tenant's agents, employees or contractors, or is not due to
a governmental directive, and (ii) Tenant actually vacates all of the Premises,
then, as the sole and exclusive remedy of Tenant on account thereof, Basic Rent
and other Rent amounts payable hereunder shall thereafter be equitably abated
until the date such service is substantially restored. The provisions of this
subsection (c) shall not apply in the event of a fire, other Casualty or a
Taking, or other event governed by the provisions of Sections 14 and/or 15
hereof. For purposes of this Lease, the terms "untenantable" and
"untenantability" shall mean that the Premises, or any portion of the Premises,
as the case may be, are not, despite Tenant's commercially reasonable good faith
efforts, usable by Tenant in the ordinary course of Tenant's business.

 

(d)Access. Subject to the Building's Rules and Regulations and the other
provisions of this Lease (including Section 7(a) hereof), Tenant will be
provided access to the Premises and Parking Area (as defined herein) 24 hours
per day, seven days per week, 52 weeks a year. If such access is unavailable due
to force majeure or any other reason beyond Landlord's control (including
construction performed by parties other than Landlord which prohibits such
access), Landlord shall not be in default under this Section 7(d).

 

8.Improvements; Alterations; Repairs; Maintenance.

 

(a)Improvements; Alterations. Improvements to the Premises shall be installed at
Tenant's expense only in accordance with plans and specifications which have
been previously approved in writing by Landlord, which approval shall be
governed by the provisions set forth in this Section 8(a). No alterations or
additions in or to the Premises may be made without Landlord's prior written
consent, which consent shall not be unreasonably withheld, conditioned or
delayed; provided, however, Landlord shall not unreasonably withhold its consent
to any alteration or addition that would not affect (in the reasonable
discretion of Landlord) the (1) Building's Structure or the Building's Systems
(including the Building's restrooms or mechanical rooms), (2) exterior
appearance of the Building, (3) appearance of the Building's common areas or
elevator lobby areas, (4) provision of services to other occupants of the
Building, (5) the safety of other tenants in the Building, and (6) the
appearance, character, reputation, value, marketability, and desirability of the
Building, and in each instance is in compliance with all applicable Laws. Tenant
shall not paint or install lighting or decorations, signs, window or door
lettering, or advertising media of any type visible from the exterior of the
Premises without the prior written consent of Landlord, which consent may be
withheld in Landlord's sole and absolute discretion. All alterations, additions,
and improvements shall be constructed, maintained, and used by Tenant, at its
risk and expense, in accordance with all Laws; Landlord's consent to or approval
of any alterations, additions or improvements (or the plans therefor) shall not
constitute a representation or warranty by Landlord, nor Landlord's acceptance,
that the same comply with sound architectural and/or engineering practices or
with all applicable Laws, and Tenant shall be solely responsible for ensuring
all such compliance. Landlord shall have no liability to Tenant or any other
party in connection with Landlord's approval of any plans and specifications for
any alterations, or Landlord's consent to Tenant's performing any alterations.
Notwithstanding anything to the contrary herein, Tenant shall be permitted to
make interior, non- structural alterations within the Premises without
Landlord's prior consent (but with five (5) business days prior written notice
thereof to Landlord), provided that such alterations (i) do not affect or impact
any structural components or any mechanical, electrical or plumbing systems or
equipment of the Building, (ii) do not impact any other tenant's premises, (iii)
are not visible from outside of the Premises, (iv) do not exceed Twenty-Five
Thousand Dollars ($25,000) in the aggregate, and (v) do not require the issuance
of a building permit; provided that such alterations shall be subject to the
other terms and conditions of this Lease governing improvements and alterations.

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(1)Pre-Construction Obligations. Prior to making any alterations, Tenant, at its
expense, shall, and shall cause its contractors to (i) submit to Landlord for
its written approval, detailed plans and specifications (including layout,
architectural, mechanical, electrical, plumbing, sprinkler and structural
drawings) of each proposed alteration, (ii) obtain all permits, approvals and
certificates required by any governmental authorities, (iii) furnish to Landlord
duplicate original policies or certificates of worker's compensation insurance
(covering all persons to be employed by Tenant, and Tenant's contractors and
subcontractors in connection with such alteration), comprehensive public
liability (including property damage coverage) and builder's risk insurance
coverage (issued on a completed value basis) all in such form, with such
companies, for such periods and in such amounts as Landlord may reasonably
require, naming Landlord, Landlord's managing agent, and their respective
employees and agents, any mortgagee as additional insureds, and (iv) furnish to
Landlord such other evidence of Tenant's ability to complete and to fully pay
for such alterations as is reasonably satisfactory to Landlord. Upon Tenant's
request, Landlord shall exercise reasonable efforts to cooperate with Tenant in
obtaining any permits, approvals or certificates required to be obtained by
Tenant in connection with any permitted alteration (if the provisions of the
applicable Laws or governmental requirements require that Landlord join in such
application), provided Landlord shall incur no cost, expense or liability in
connection therewith.

 

(2)Post-Construction Obligations. Within ten (10) business days following
completion of any alterations, Tenant, at its expense, shall obtain and deliver
to Landlord: (i) copies of paid invoices covering all of the alterations, (ii)
final waivers of lien from all contractors, subcontractors and material
suppliers performing work or providing material in connection with the
alterations, (iii) proof of the satisfactory completion of all required
inspections and the issuance of any required approvals and sign-offs by
governmental authorities with respect thereto, (iv) "as-built" plans and
specifications for such alterations, (v) a written certification in the form of
the AIA Document G702 (or, if such document is no longer in use, such other form
as Landlord shall reasonably approve) from Tenant's architect stating that (A)
the alterations have been completed in accordance with the plans and
specifications approved by Landlord, (B) such work has been paid in full by
Tenant, and (C) all contractors, subcontractors and materialmen that have
provided more than $10,000 of work or materials have delivered to Tenant waivers
of lien with respect to such work (copies of which shall be included with
such  architect's certification), and (vi) such other documents and information
as Landlord may reasonably request.

 

(3)Standards of Work. All alterations shall be performed (i) in a good and
first- class workmanlike manner and free from defects, (ii) in accordance with
the plans and specifications approved by Landlord, and by contractors approved
by Landlord, (iii) excepting only decorative Alterations, under the supervision
of a licensed architect reasonably satisfactory to Landlord, and (iv) in
compliance with all Laws, the terms of this Lease, all procedures and
regulations then prescribed by Landlord for coordinating all work performed in
the Building. All materials and equipment to be used in the Premises shall be of
first quality and at least equal to the applicable standards for the Building
then established by Landlord and is consistent with Class A office buildings in
Austin, Texas, and no such materials or equipment shall be subject to any lien
or other encumbrance. Tenant shall not take any action which would violate
Landlord's labor contracts or which would cause a work stoppage, picketing,
labor disruption or dispute, or interfere with Landlord's or any other tenant's
or occupant's business or with the rights and privileges of any person lawfully
in the Building ("Labor Disruption"). Tenant shall take the actions reasonably
necessary to resolve the Labor Disruption, and shall have pickets removed and,
at the request of Landlord, immediately terminate any work in the Premises that
gave rise to the Labor Disruption, until such Labor Disruption has been
resolved. Tenant shall have no claim for damages  against Landlord, nor shall
the date of the commencement of the Term be extended as a result of the above
actions.

 

(4)Payment of Landlord's Costs. Tenant shall pay to Landlord or its designee, as
Additional Rent, within thirty (30) days after request therefor, all
out-of-pocket costs actually incurred by Landlord in connection with Tenant's
alterations including, without limitation, costs incurred in connection with (a)
Landlord's review of the alterations and plans therefor (including review of
requests for approval thereof) and (b) the provision of Building personnel
during the performance of any alteration to operate elevators or otherwise to
facilitate any alterations. In addition, Tenant shall pay to Landlord or its
designee, within thirty (30) days following written demand from Landlord, an
administrative fee in the amount of one percent (1%) of the total cost of such
alterations in respect of the performance of such alterations and the scheduling
of equipment, facilities and personnel in connection therewith.

 

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(b)Repairs; Maintenance. Tenant shall maintain the Premises in a clean,
safe,  and operable condition, and shall not permit or allow any damage to any
portion of the Premises. Additionally, Tenant, at its sole expense, shall
repair, replace and maintain in good condition and in accordance with all Laws
and the equipment manufacturer's suggested service programs, all portions of the
Premises, Tenant's Off-Premises Equipment and all areas, improvements and
systems exclusively serving the Premises. Tenant shall repair or  replace,
subject to Landlord's direction and supervision, any damage to the Building
caused by a Tenant Party. If Tenant fails to make such repairs or replacements
within five business days after written notice from Landlord (or such longer
period as may be reasonably required provided Tenant commences to perform such
required repairs or replacements within such five business-day period and
proceeds diligently to completion), then Landlord may make the same at Tenant's
cost. If any such damage occurs outside of the Premises, then Landlord may elect
to repair  such damage at Tenant's expense, rather than having Tenant repair
such damage. The reasonable costs of all maintenance, repair or replacement work
performed by Landlord under this Section 8 shall be paid by Tenant to Landlord
within 30 days after Landlord has invoiced Tenant therefor.

 

(c)Performance of Work. All work described in this Section 8 shall be performed
only by Landlord or by contractors and subcontractors approved in writing by
Landlord, which approval will not be unreasonably withheld for contractors and
subcontractors that maintain the insurance coverage required by Landlord, and in
all events in accordance with the provisions of Section 8(a) above. Tenant shall
provide Landlord with the identities, mailing addresses and telephone numbers of
all persons performing work or supplying materials prior to beginning such
construction and Landlord may post on and about the Premises notices of
non-responsibility pursuant to applicable Laws. All work shall be performed in
accordance with all Laws and in a good and workmanlike manner so as not to
damage the Building (including the Premises, the Building's Structure and the
Building's Systems). All such work which may affect the Building's Structure or
the Building's Systems must be approved by the Building's engineer of record, at
Tenant's expense and, at Landlord's election, must be performed by Landlord's
usual contractor for such work. All work affecting the Building roof must be
performed by Landlord's roofing contractor and will not be permitted if it would
void or reduce the warranty on the roof.

 

(d)Mechanic's Liens. All work performed, materials furnished, or obligations
incurred by or at the request of a Tenant Party shall be deemed authorized and
ordered by Tenant only, and Tenant shall not permit any mechanic's liens to be
filed against the Premises or the Project in connection therewith.  Upon
completion of any such work, Tenant shall deliver to Landlord final lien waivers
from all contractors, subcontractors and materialmen who performed such work. If
a lien is filed, then Tenant shall, within seven (7) business days after
Tenant's receipt of notice thereof (or earlier, as necessary to prevent the
forfeiture of the Premises, the Project or any interest of Landlord therein or
the imposition of a fine with respect thereto), either (1) pay the amount of the
lien and cause the lien to be released of record, or (2) diligently contest such
lien and deliver to Landlord a bond or other security reasonably satisfactory to
Landlord.  If Tenant fails to timely take either such action, then Landlord
may  pay the lien claim, and any amounts so paid, including expenses and
interest, shall be paid by Tenant to Landlord within ten days after Landlord has
invoiced Tenant therefor. Landlord and Tenant acknowledge and agree that their
relationship is and shall be solely that of "landlord-tenant" (thereby excluding
a relationship of "owner-contractor," "owner-agent" or other similar
relationships). Accordingly, all materialmen, contractors, artisans, mechanics,
laborers and any other persons now or hereafter contracting with Tenant, any
contractor or subcontractor of Tenant or any other Tenant Party for the
furnishing of any labor, services, materials, supplies or equipment with respect
to any portion of the Premises during the Term, are hereby charged with notice
that they look exclusively to Tenant to obtain payment for same. Nothing herein
shall be deemed a consent by Landlord to any liens being placed upon the
Premises, the Project or Landlord's interest therein due to any work performed
by or for Tenant or deemed to give any contractor or subcontractor or
materialman any right or interest in any funds held by Landlord to reimburse
Tenant for any portion of the cost of such work. Tenant shall defend, indemnify
and hold harmless Landlord and its agents and representatives from and against
all claims, demands, causes of action, suits, judgments, damages and expenses
(including attorneys' fees) in any way arising from or relating to the failure
by any Tenant Party to pay for any work performed, materials furnished, or
obligations incurred by or at the request of a Tenant Party. This indemnity
provision shall survive termination or expiration of this Lease.

 

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9.Use and Compliance with Law.

 

(a)Use. Tenant shall occupy and use the Premises only for the Permitted Use and
shall comply with all Laws relating to this Lease and/or the use, condition,
access to, and occupancy of the Premises and will not commit waste, overload the
Building's Structure or the Building's Systems or subject the Premises to use
that would damage the Premises. The population density within the Premises as a
whole shall at no time exceed five persons for each 1,000 rentable square feet
in the Premises. Tenant may use the Premises after normal business hours, so
long as Tenant is not generally conducting business from the Premises after
normal business hours. The Premises shall not be used for any use which is
disreputable, creates extraordinary fire hazards, or for the storage of any
Hazardous Materials, except in full compliance with all applicable Laws and this
Lease. To the extent that Tenant's use directly results in an increase rate of
insurance or any insurance expenses for the Building or its contents, then
Tenant shall compensate Landlord for such increase. Tenant shall not use any
substantial portion of the Premises for a "call center," any other telemarketing
use, or any credit processing use. If, because of (a) Tenant's use, (b) Tenant's
build-out, (c) a Tenant Party's acts, or (d) because Tenant vacates the
Premises, the rate of insurance on the Building or its contents increases, then
Tenant shall pay to Landlord the amount of such increase on demand, and
acceptance of such payment shall not waive any of Landlord's other rights.
Tenant shall conduct its business and control each other Tenant Party so as not
to create any nuisance or unreasonably interfere with other tenants or Landlord
in its management of the Project.

 

(b)Compliance with Law.

 

(1)Existing Laws. If any Laws in existence as of the date of this Lease require
an alteration or modification of the Premises (a "Code Modification") and such
Code Modification (i) is not made necessary as a result of the specific use
being made by Tenant of the Premises (as distinguished from an alteration or
improvement which would be required to be made by the owner of any building
comparable to the Building irrespective of the use thereof by any particular
occupant), and (ii) is not made necessary as a result of any alteration of the
Premises by Tenant, then such Code Modification shall be performed by Landlord
at Landlord's sole cost and expense.

 

(2)Governmental Regulations – Landlord Responsibility. If, as a result of
one  or more Laws that are not in existence as of the date of this Lease, it is
necessary from time to time during the Term, to perform a Code Modification to
the Building or Project that (i) is not made necessary as a result of the
specific use being made by Tenant of the Premises (as distinguished from an
alteration or improvement which would be required to be made by the owner of any
building comparable to the Building irrespective of the use thereof by any
particular occupant), and (ii) is not made necessary as a result of any
alteration of the Premises by Tenant, such Code Modification shall be performed
by Landlord and cost thereof shall be included as Operating Costs.

 

(3)Governmental Regulations – Tenant Responsibility. If, as a result of one or
more Laws, it is necessary from time to time during the Term, to perform a Code
Modification to the Building or Project that is made necessary as a result of
the specific use being made by Tenant of the Premises or as a result of any
alteration of the Premises by Tenant, such Code Modification shall be the sole
and exclusive responsibility of Tenant in all respects; provided, however,
Tenant shall have the right to retract its request to perform a proposed
alteration in the event that the performance of such alteration would trigger
the requirement for a Code Modification.

 

(c)Lab Area. The following provisions shall apply to the Lab Area:

 

(1)Notwithstanding anything to the contrary contained in this Lease, Tenant
acknowledges that Landlord has made no representation that (i) the Permitted Use
is permitted pursuant to applicable laws, including applicable zoning laws,
healthcare regulatory requirements and applicable environmental laws, nor (ii)
the Premises or the configuration of or access to the Premises complies with any
healthcare regulatory requirements applicable to the Permitted Use or to Tenant,
and Tenant shall have no recourse against Landlord, and no right terminate this
Lease, offset against the rent hereunder or abate the rent hereunder, if the
Permitted Use is not so permitted or if the Premises are not compliant in such
manner. Any individuals working at the Lab Area shall have all licenses,
certifications and the like required by applicable law for the position they
hold and the work they perform.

 

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(2)Tenant shall, at Tenant's expense, be responsible for the disposal of trash
and waste from the Lab Area. This must be done in accordance with all applicable
laws and good medical practice. Landlord shall provide standard cleaning and
trash removal services for all typical offices, consultation rooms where no
blood, medical waste and/or biohazard materials are generated, conference rooms,
hallways, reception areas, internal restroom and kitchen countertops, sinks, and
flooring. In no event shall Landlord be obligated to handle or remove any trash
or waste containing blood, medical waste or biohazard materials. Notwithstanding
the foregoing, Landlord shall not be required to provide any standard cleaning
or trash removal services to any area within the Premises if access to such
areas would expose Landlord or the personnel of Landlord or Landlord's property
manager to any medical waste, organic tissue and biohazard materials. Subject to
Section 27(c), all of Tenant's cleaning shall be coordinated with any work or
cleaning being performed by or for Landlord and in such manner as to maintain
harmonious labor relations and not to interfere with Building construction or
operation, and Tenant shall use cleaning contractors reasonably acceptable to
Landlord.

 

(3)Tenant shall, at Tenant's expense, be responsible for the separation of and
disposal of all trash containing any medical waste, organic tissue and/or
biohazard materials that is generated in the Lab Area from the typical trash
found in typical offices (i.e., paper and any non-medical and/or biohazard
materials) ("Typical Office Trash"). Tenant's contractor(s) shall dispose of all
trash containing medical waste, organic tissue and biohazard materials in
accordance with Applicable Requirements, as hereinafter defined, and shall not
commingle it with trash from the remainder of the Lab Area or from any other
portion of the Building. Without limiting the foregoing, Tenant shall be
responsible, at its sole cost and expense, for the safe and complete disposal,
and the transport off-site, of all items that are by law defined as medical
waste, organic tissues and biohazard materials or items that have been exposed
to medical waste, organic tissues and biohazard materials such as syringes,
bandages, medical instruments, tissues, samples, containers, receptacles, cotton
packing, swabs, etc., as well as any and all potentially, possibly or actually
contaminated, hazardous, diseased, infected or infectious material, substance or
thing utilized or brought upon the Lab Area by Tenant or others. Without
impairing any of the restrictions on use contained in this Lease and without
expanding the definition of "Permitted Use" hereunder, the term "medical waste"
as used hereunder shall include, without limitation, any and all waste generated
in the diagnosis, treatment or immunization of humans or animals related
research, or in the preparation and administration of diagnostic, enzymatic or
treatment agents, together with all such other wastes which are defined pursuant
to any medical or biological waste regulations which have been or may be
hereafter promulgated by any governmental agency or authority with jurisdiction
over the Premises or the Tenant's use thereof or business conducted therein, and
as further set forth in any laws now or hereafter applicable to the Tenant or
the Premises.

 

(4)Tenant's disposal of medical or other waste resulting from its operation of
the Lab Area shall comply, without limitation, with the following: (i) all
applicable federal (including, without limitation, OSHA and the Health Insurance
Portability and Accountability Act), state and local laws, regulations and
rules, written policies, standards and guidance documents; (ii) all written
instructions and guidelines given by the manufacturers of any processing systems
and chemicals used in the Tenant's operations within the Lab Area; and (iii) all
written specifications and requirements with respect to the operation and
maintenance of any sewage treatment plant serving the Lab Area and/or the
Building. The aforementioned requirements are hereinafter collectively referred
to as the "Applicable Requirements." The Tenant is responsible for ascertaining
all of the Applicable Requirements. Tenant shall be responsible for, and shall
be deemed the generator of, all medical waste, organic tissue and biohazard
materials at, on or from the Premises.

 

(5)Tenant shall not place or permit the placement of any medical waste, organic
tissue or biohazard materials receptacles or courier lock boxes (such as those
used for the pick-up and delivery of samples or impressions, laboratory samples,
or prosthetic dental devices) in any common areas of the Building.

 

(6)Tenant shall not use any radioactive or corrosive materials in the Lab Area,
except as may be specifically approved by Landlord in writing, in its reasonable
discretion. Any such approval by Landlord shall not be deemed to be a
representation by Landlord that such materials are lawful or safe. Any medical
equipment ("Medical Equipment") installed or operated in the Lab Area shall be
installed and operated in accordance with all Applicable Requirements and with
the provisions of this Lease, and further shall be operated in such a fashion
that no noise, odor or vibration therefrom is discernable outside the Lab Area.
Tenant shall have the right to install, maintain and operate audio equipment
within the Lab Area provided that no sound from the use of such system (whether
for music, announcements or otherwise) shall be discernable outside the Lab
Area.

 

(7)Tenant shall ensure that the Lab Area is not visible from outside of the
Premises.

 

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(8)Tenant shall not bring or permit to be brought or kept in the Lab Area or
elsewhere in the Building any Hazardous Materials. Notwithstanding the
foregoing, Tenant shall be permitted to use and store in the Lab Area, Hazardous
Materials which are typically used or generated in the operation of a "light"
lab permitted in the Permitted Use, provided that such materials are stored,
used and disposed of in strict compliance with all applicable laws, rules or
regulations governing the production, possession, storage and disposal any such
materials Hazardous Materials ("Hazardous Materials Laws") and with good
scientific and medical practice. With respect to any of Tenant's Hazardous
Materials, if Tenant does not properly handle, store or dispose of in compliance
with all applicable Hazardous Materials Laws and good scientific and medical
practice, such failure shall be an Event of Default under this Lease. Tenant
shall be responsible for, and shall be deemed the generator of, all Hazardous
Materials used by or on behalf of Tenant at, on or from the Premises.

 

(9)Tenant shall maintain in the Lab Area available for inspection by Landlord a
"Hazardous Materials List" of all Hazardous Materials transported, stored, used,
handled, recycled or disposed of by Tenant in connection with Tenant's
operations within the Lab Area, which list shall state the approximate quantity
of each such Hazardous Material present in the Lab Area. An initial Hazardous
Materials List indicating such materials shall be available for inspection by
Landlord prior to occupancy by Tenant and shall be updated throughout the Term
of the Lease upon any change in usage, processing method or system, or any
material change in quantity, of such materials. Furthermore, Tenant shall
maintain in the Lab Area available for Landlord's inspection a copy of a current
material safety data sheet for each substance on the Hazardous Materials List
and any other information required by law to be maintained in connection with
the Tenant's operations within the Lab Area. Tenant shall  provide Landlord on
request with evidence of the proper licensing, if and as required by Applicable
Requirements, of any individuals or entities handling Hazardous Materials in the
Lab Area. Review by Landlord of any such information shall not be deemed to be a
representation by Landlord that Tenant or such information is in compliance with
applicable laws relating to same.

 

(10)Tenant may not dispose of any chemicals used in its operations within the
Lab Area in the sewer system serving the Lab Area and/or the Building. All
chemicals used in connection with Tenant's operations shall be properly stored
and removed from the Lab Area in full compliance with all Applicable
Requirements. Disposal must be done in strict compliance with the Applicable
Requirements. Tenant shall make available for Landlord's inspection all
documentation provided by the manufacturer relating to the design and operation
of any of Tenant's equipment involved in the generation of waste that is subject
to the Applicable Requirements, including without limitation piping or chemical
transport diagrams and the manufacturers' description of the methods used by the
system to achieve any required  pH levels. Tenant shall obtain and maintain in
full force and effect all permits required by applicable Laws for storage and
disposal by Tenant of any Hazardous Materials used or generated by Tenant. If
Tenant believes following reasonable inquiry that no such permits are required,
Tenant shall provide a written certification of same to Landlord upon Landlord's
request. Tenant shall be responsible for, and shall be deemed the generator of,
all Hazardous Materials used, stored, generated or disposed of by or on behalf
of Tenant at, on or from the Premises.

 

(11)The Tenant is responsible for the design, maintenance and operation of all
apparatus associated with Tenant's operations within the Lab Area and such
apparatus as may be required by Applicable Requirements.

 

(12)NOTICE: THE FOREGOING IS NOT A CHECKLIST FOR COMPLIANCE WITH APPLICABLE LAW.
THE TENANT IS ULTIMATELY RESPONSIBLE FOR ASCERTAINING, AND OPERATING IN
ACCORDANCE WITH, ALL APPLICABLE REQUIREMENTS. NOTHING IN THIS LEASE, NOR ANY
OTHER REQUIREMENTS OR SPECIFIC "APPROVAL" OR "CONSENT" AT ANY TIME GIVEN BY
LANDLORD, SHALL BE CONSTRUED IN ANY WAY TO DIMINISH TENANT'S RESPONSIBILITY TO
COMPLY WITH APPLICABLE REQUIREMENTS, TO RELEASE TENANT FROM LIABILITY FOR
TENANT'S OPERATIONS OR DELETERIOUS EFFECTS OF THE MATERIALS USED BY THE TENANT,
OR IN ANY WAY TO AFFECT OR DIMINISH LANDLORD'S RIGHTS AND REMEDIES PURSUANT TO
THE INDEMNITY PROVISIONS CONTAINED IN THIS LEASE.

 

(13)Any increase in the premium for necessary insurance on the Lab Area or the
Building which arises from Tenant's use and/or storage of these Hazardous
Materials (as stated by any insurance company or by the applicable insurance
rating bureau) shall be solely at Tenant's expense. Tenant shall procure and
maintain at its sole expense such additional insurance as may be necessary to
comply with any requirement of any Federal, State or local government agency
with jurisdiction. Tenant shall comply both with any requirements of Landlord's
insurance carrier and with any requirements of the Board of Fire Underwriters in
its use of the Lab Area.

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(14)TENANT HEREBY AGREES TO INDEMNIFY, DEFEND AND SAVE LANDLORD, ITS OFFICERS,
DIRECTORS, MEMBERS, PARTNERS, AGENTS, AND EMPLOYEES (THE "LANDLORD INDEMNITEES")
HARMLESS FROM ALL LIABILITY, LOSS, DAMAGES, COSTS OR EXPENSES, INCLUDING
REASONABLE ATTORNEYS' FEES, INCURRED IN CONNECTION WITH ANY CLAIMS OF ANY NATURE
WHATSOEVER AS THE RESULT OF ANY INJURY TO ANY INDIVIDUAL OR ENTITY OCCASIONED BY
CONTACT WITH OR EXPOSURE TO ANY INFECTIOUS, INFECTED, HAZARDOUS OR CONTAMINATED
MATERIAL, SUBSTANCE OR THING UTILIZED, APPLIED, REMOVED OR RECEIVED BY TENANT,
ITS AGENTS OR EMPLOYEES (REGARDLESS OF WHETHER LANDLORD, ITS AGENTS OR EMPLOYEES
PERMITTED SUCH MATERIAL, SUBSTANCE OR THING TO BE PRESENT AT THE PROJECT) EXCEPT
TO THE EXTENT ARISING FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
LANDLORD, ITS AGENTS OR EMPLOYEES. THIS INDEMNITY PROVISION SHALL SURVIVE THE
TERMINATION OR EXPIRATION OF THIS LEASE.

 

(15)If Tenant breaches its obligations under this Section 9(c), Landlord shall
send Tenant notice thereof, except that no notice shall be required in an
emergency, following receipt of which Tenant shall immediately take any and all
action reasonably appropriate to remedy such breach, including taking all
appropriate action to clean up or remediate any contamination resulting from
Tenant's use, generation, storage or disposal of Hazardous Materials. If Tenant
fails to commence any such action within five (5) calendar days' written notice
from Landlord to Tenant, or such shorter period as may be practicable under the
circumstances in the event of an emergency involving the violation of a
Hazardous Materials Law (the "Cure Period"), Landlord may take any and all
action reasonably appropriate to remedy the same, and Tenant agrees to pay to
Landlord the reasonable, third-party, out-of-pocket cost thereof not later than
thirty (30) days following Landlord's demand therefor (accompanied by a
reasonably detailed invoice with respect thereto), as additional rent.
Notwithstanding the foregoing, if such repairs  are the type that cannot be
completed within the Cure Period, then provided Tenant begins such repair within
the Cure Period and proceeds diligently and in good faith thereafter to complete
the repairs, the Cure Period shall be extended by that period as is reasonably
necessary to effect such repair (which extension shall not exceed thirty (30)
days if Landlord reasonably determines that such damage (i) constitutes an
emergency, (ii) affects other tenants or the operation of the Building or (iii)
is not contained within the Lab Area). TENANT SHALL DEFEND, INDEMNIFY, AND HOLD
HARMLESS THE LANDLORD INDEMNITEES FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS,
LIABILITIES, CAUSES OF ACTION, SUITS, JUDGMENTS, DAMAGES AND EXPENSES (INCLUDING
REASONABLE ATTORNEYS' FEES AND OUT-OF-POCKET COSTS OF CLEANUP AND REMEDIATION)
ARISING FROM TENANT'S FAILURE TO COMPLY WITH THE PROVISIONS OF THIS SECTION
9(C). THIS INDEMNITY PROVISION SHALL SURVIVE THE TERMINATION OR EXPIRATION OF
THIS LEASE.

 

(16)Tenant shall contract for and utilize termite and pest extermination
services for the Lab Area as evidenced by a service contract which shall be made
provided to Landlord on a monthly basis or upon request by Landlord from time to
time. If Landlord is required to provide pest control for  the Building and/or
Property in excess of building standard pest control by reason of an Food and
Drug Administration or other governmental regulations that become applicable to
the Property by reason of Tenant's operations in the Premises other than office
use, then Tenant shall reimburse Landlord, as additional rent, the cost of such
additional pest control.

 

(17)No animals, animal waste, food or supplies relating to animals or
animal-testing shall be permitted in the Premises or within the Building except
as otherwise permitted pursuant to the Permitted Use of the Lab Area.

 

10.Assignment and Subletting.

 

(a)Transfers. Except as provided in Section 10(h), Tenant shall not, without the
prior written consent of Landlord, directly or indirectly, voluntarily or
involuntarily, (1) assign, transfer, or encumber this Lease or any estate or
interest herein, whether directly or by operation of law, (2) permit any other
entity to become Tenant hereunder by merger, consolidation, or other
reorganization, (3) if Tenant is an entity other than a corporation whose stock
is publicly traded, permit the transfer of an ownership interest in Tenant so as
to result in a change in the current control of Tenant, (4) sublet any portion
of the Premises, (5) grant any license, concession, or other right of occupancy
of any portion of the Premises, or (6) permit the use of the Premises by any
parties other than Tenant (any of the events listed in Section 10(a)(1) through
10(a)(6) being a "Transfer").

 

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(b)Consent Standards. Landlord shall not unreasonably withhold its consent to
any assignment or subletting of the Premises, provided that the proposed
transferee (1) has a Tangible Net Worth (as defined below) sufficient to meet
the obligations of Tenant under this Lease as reasonably determined by Landlord,
(2) has a good reputation in the business community, (3) will use the Premises
for the Permitted Use (thus, excluding, without limitation, uses for credit
processing and telemarketing) and will not use the Premises in any manner that
would conflict with any exclusive use agreement or other similar agreement
entered into by Landlord with any other tenant of the Building or Complex, (4)
will not use the Premises, Building or Project in a manner that would materially
increase the pedestrian or vehicular traffic to the Premises, Building or
Project, (5) is not a governmental entity, or subdivision or agency thereof, (6)
is not another occupant of the Building or Complex, (7) is in compliance with
the regulations of the Office of Foreign Asset Control ("OFAC") of the
Department of the Treasury (including those named on OFAC's Specially Designated
Nationals and Blocked Persons List) and any statute, executive order (including
the September 24, 2001, Executive Order Blocking Property and Prohibiting
Transactions with Persons Who Commit, Threaten to Commit or Support Terrorism),
or other governmental action relating thereto; and (8) is not a person or entity
with whom Landlord is then, or has been within the six-month period prior to the
time Tenant seeks to enter into such assignment or subletting, negotiating to
lease space in the Building or Complex or any Affiliate of any such person or
entity; otherwise, Landlord may withhold its consent in its sole discretion.
Additionally, Landlord may withhold its consent to any proposed Transfer if any
Event of  Default by Tenant then exists.

 

(c)Request for Consent. At least 15 business days prior to the effective date of
the proposed Transfer, Tenant shall provide Landlord with a written description
of all terms and conditions of the proposed Transfer, copies of the proposed
documentation, and the following information about the proposed transferee: name
and address of the proposed transferee and any entities and persons who own,
control or direct the proposed transferee; reasonably satisfactory information
about its business and business history; its proposed use of the Premises;
banking, financial, and other credit information; and general references
sufficient to enable Landlord to determine the proposed transferee's
creditworthiness and character. Within 30 days after written notice from
Landlord, Tenant will reimburse Landlord for its reasonable attorneys' fees
incurred in connection with considering any request for consent to a Transfer,
not to exceed $2,500.00 per request for consent.

 

(d)Conditions to Consent. If Landlord consents to a proposed Transfer, the
proposed transferee shall deliver to Landlord a written agreement expressly
assuming Tenant's obligations hereunder; however, any transferee of less than
all of the Premises shall be liable only for obligations under this Lease that
are properly allocable to the space subject to the Transfer for the period of
the Transfer. No Transfer shall release Tenant from its obligations under this
Lease; Tenant and its transferee shall be jointly and severally liable therefor.
Landlord's consent to any Transfer shall not waive Landlord's rights as to any
subsequent Transfers. If an Event of Default occurs while any part of the
Premises or any part thereof are subject to a Transfer, then Landlord, in
addition to its other remedies, may collect directly from such transferee all
rents becoming due to Tenant and apply such rents against Rent. Tenant instructs
its transferees to make payments of rent directly to Landlord upon receipt of
notice from Landlord to do so following the occurrence of an Event of Default.
Tenant shall pay for the cost of any demising walls or other improvements
necessitated by a proposed subletting or assignment.

 

(e)Attornment by Subtenants.  Each sublease hereunder shall be subject and
subordinate  to this Lease and to the matters to which this Lease is or shall be
subordinate, and each subtenant is deemed to have agreed that in the event of
termination, re-entry or dispossession by Landlord under this Lease, Landlord
may, at its option, take over all of the right, title and interest of Tenant, as
sublandlord, under such sublease, and such subtenant shall, at Landlord's
option, attorn to Landlord pursuant to the then executory provisions of such
sublease, except that Landlord shall not be (1) liable for any previous act or
omission of Tenant under such sublease, (2) subject to any counterclaim, offset
or defense of such subtenant against Tenant, (3) bound by any previous
modification of such sublease not approved by Landlord in writing or by any rent
or additional rent or advance rent which such subtenant has paid for more than
the current month to Tenant, and all such rent shall remain due and owing,
notwithstanding such advance payment, (4) bound by any security or advance
rental deposit made by such subtenant which is not delivered to Landlord and
with respect to which such subtenant shall look solely to Tenant for refund or
reimbursement, or (5) obligated to perform any work in the subleased space or to
prepare it for occupancy, and in connection with such attornment, the subtenant
shall execute and deliver to Landlord any instruments Landlord may reasonably
request to evidence and confirm such attornment. Each subtenant or licensee of
Tenant shall be deemed, automatically as a condition of its occupying or using
any part of the Premises, to have agreed to be bound by the terms of this
Section 10(e).

 

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(f)Cancellation. If Tenant proposes to assign or sublet more than 50% of the
rentable square footage of the Premises, Landlord may, within 30 days after
receipt of Tenant's written request for Landlord's consent to an assignment or
subletting, cancel this Lease as to the portion of the Premises proposed to be
sublet or assigned as of the date the proposed Transfer is to be effective. If
Landlord cancels this Lease as to any portion of the Premises, then this Lease
shall cease for such portion of the Premises and Tenant shall pay to Landlord
all Rent accrued through the cancellation date relating to such portion of the
Premises. Thereafter, Landlord may lease such portion of the Premises to the
prospective transferee (or to any other person) without liability to Tenant.

 

(g)Additional Compensation. Tenant shall pay to Landlord, immediately upon
receipt thereof, the excess of (i) all compensation received by Tenant for a
Transfer less the actual out-of-pocket costs reasonably incurred by Tenant with
unaffiliated third parties (i.e., brokerage commissions, legal fees and tenant
finish work) in connection with such Transfer over (ii) the Rent allocable to
the portion of the Premises covered thereby.

 

(h)Permitted Transfers. Notwithstanding Section 10(a), Tenant may Transfer all
or part of its interest in this Lease or all or part of the Premises (a
"Permitted Transfer") to the following types of entities (a "Permitted
Transferee") with the written consent of Landlord which consent shall not be
unreasonably withheld, conditioned or delayed:

 

(1)an Affiliate of Tenant, so long as such Affiliate was not formed to avoid the
obligations of this Section 10 or adversely affect the ability of Tenant to
satisfy its obligations under this Lease;

 

(2)any corporation, limited partnership, limited liability partnership, limited
liability company or other business entity in which or with which Tenant, or its
corporate successors or assigns, is merged or consolidated, in accordance with
applicable statutory provisions governing merger and consolidation of business
entities, so long as (A) Tenant's obligations hereunder are assumed by the
entity surviving such merger or created by such consolidation; and (B) the
Tangible Net Worth of the surviving or created entity is (i) sufficient to meet
the obligations of Tenant under this Lease as reasonably determined by Landlord,
and (ii) not less than the Tangible Net Worth of Tenant as of the date hereof;
or

 

(3)any corporation, limited partnership, limited liability partnership, limited
liability company or other business entity acquiring all or substantially all of
Tenant's assets if such entity's Tangible Net Worth after such acquisition is
(i) sufficient to meet the obligations of Tenant under this Lease as reasonably
determined by Landlord, and (ii) not less than the Tangible Net Worth of Tenant
as of the date hereof.

 

Tenant shall promptly notify Landlord of any such Permitted Transfer. Tenant
shall remain liable for the performance of all of the obligations of Tenant
hereunder, or if Tenant no longer exists because of a merger, consolidation, or
acquisition, the surviving or acquiring entity shall expressly assume in writing
the obligations of Tenant hereunder. Additionally, the Permitted Transferee
shall comply with all of the terms and conditions of this Lease and the use of
the Premises by the Permitted Transferee may not violate any other agreements
affecting the Premises, the Building, the Complex, Landlord or other tenants of
the Building or the Complex. No later than 30 days after the effective date of
any Permitted Transfer, Tenant shall furnish Landlord with (A) copies of the
instrument effecting such Permitted Transfer, (B) documentation establishing
Tenant's satisfaction of the requirements set forth above applicable to any such
Transfer, (C) evidence of insurance as required under this Lease with respect to
the Permitted Transferee, and (D) evidence of compliance with the regulations of
OFAC and any statute, executive order (including the September 24, 2001,
Executive Order Blocking Property and Prohibiting Transactions with Persons Who
Commit, Threaten to Commit, or Support Terrorism), or other governmental action
relating thereto, including the name and address of the Permitted Transferee and
any entities and persons who own, control or direct the Permitted Transferee.
The occurrence of a Permitted Transfer shall not waive Landlord's rights as to
any subsequent Transfers. "Tangible Net Worth" means the excess of total assets
over total liabilities, in each case as determined in accordance with generally
accepted accounting principles consistently applied ("GAAP"), excluding,
however, from the determination of total assets all assets which would be
classified as intangible assets under GAAP including goodwill, licenses,
patents, trademarks, trade names, copyrights, and franchises. Any subsequent
Transfer by a Permitted Transferee shall be subject to the terms of this Section
10.

 

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11.Insurance; Waivers; Subrogation; Indemnity.

 

(a)Tenant's Insurance. Tenant shall maintain or shall cause to be maintained the
following policies of insurance at is sole cost in accordance with the General
Provisions set forth at Section 11(b) below:

 

(1)Commercial General Liability Insurance with limits of not less than One
Million Dollars ($1,000,000) per occurrence for bodily injury and property
damage, One Million U.S. Dollars ($1,000,000) any one person or organization for
personal and advertising injury, Two Million Dollars ($2,000,000) general
aggregate, covering: property/operations liability; personal injury liability;
and broad form contractual liability. Tenant's policy shall be primary and
non-contributory to any other insurance available to Landlord with respect to
claims arising from Tenant's use and occupancy of the premises and it shall be
endorsed to add as an additional insured whichever entities Landlord may require
in its reasonable discretion, which as of the Lease Date are: Rockpoint Group,
L.L.C., Rockhill Management, L.L.C., Rockpoint Real Estate Fund V, L.P.,
Rockpoint Real Estate Fund V Offshore AIV, L.P., Las Cimas Owner GP LLC, Las
Cimas Member LP, and Las Cimas Owner LP.

 

(2)Automobile Liability Insurance covering the ownership, maintenance, and
operations of any automobile or automotive equipment, whether such auto is
owned, hired or non-owned. Tenant shall maintain insurance with a combined
single limit for bodily injury and property damage of One Million Dollars
($1,000,000) each accident. Such insurance shall insure Tenant and its Tenants
against any and all claims for bodily injury, including death resulting there
from, and damage to the property of others caused by accident and arising from
Tenant's operations under the Agreement and whether such operations are
performed by Tenant, Tenant's Tenants, or by any one directly or indirectly
employed by any of them.

 

(3)Workers Compensation Insurance covering statutory workers compensation
benefits and employers liability coverage with limits of One Million Dollars
($1,000,000) each accident for bodily injury by accident and One Million Dollars
($1,000,000) each employee and policy limit for bodily injury by disease.

 

(4)Umbrella Liability Insurance providing excess liability coverage with respect
to the commercial general liability, automobile liability and employers
liability policies described above with limits of at least Ten Million Dollars
($3,000,000) per occurrence and Ten Million Dollars ($3,000,000) general
aggregate and products/completed operations aggregate. Such insurance shall be
written as follow form or with a form that provides coverage that is at least as
broad as the primary insurance policies.

 

(5)Commercial Property Insurance covering at replacement cost value the
following property that is owned by, held by, or the legal responsibility of
Tenant including but not necessarily limited to: (i) inventory; (ii) furniture,
unattached fixtures, and equipment; (iii) improvements and betterments that are
the responsibility of the Tenant; and (iv) any other property in which the
Tenant retains the risk of loss including but not limited to electronic data
processing equipment and employee personal property. Each policy shall provide
coverage against those perils that are commonly included in an "all risk" or
special causes of loss form, with no exclusions or other limitations of coverage
for wind and hail. Coverage for the perils of earthquake and flood shall be
added by endorsement at Landlord's request. Policies shall also include (a) an
"agreed amount" endorsement waiving any coinsurance requirement; (b) time
element insurance covering business interruption and extra expense resulting
from loss or damage from the hazards specified above, to owned or non-owned
property, which prevents normal operations from continuing; and (c) a loss
payable endorsement providing that Tenant and Landlord are loss payees as their
interests may appear.

 

(6)Pollution Liability. If Tenant is handling known or suspected toxic or
Hazardous Materials or covering cleanup costs and third-party claims arising
from spills, releases, or alleged exposure to Hazardous Materials used, stored,
handled, treated, generated, released, or disposed of at or from the Premises by
Tenant, the minimum limit required is $5,000,000 per occurrence and aggregate.
The policy shall provide coverage for bodily injury and property damage
resulting from environmental and pollution liability caused or exacerbated by
Tenant.

 

(b)General Provisions. Each policy of insurance required under this Lease shall
be subject to the following general provisions:

 

(1)All policies shall be issued to the Tenant as the first named insured and
(except insurance under Section 11(a)(3) above) Landlord (and any individuals or
entities with an interest in the Premises as may from time to time be requested
by Landlord) as an additional insured to the extent, where applicable. Each
policy evidencing insurance required to be carried by Tenant pursuant to this
Section shall contain the following

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clauses and provisions: (i) a provision that such policy and the coverage
evidenced thereby shall be primary and non-contributing with respect to any
policies carried by Landlord and that any coverage carried by Landlord be excess
insurance; (ii) a waiver by the insurer of any right to subrogation against the
indemnified parties which could arise by reason of any payment under such policy
or by reason of any act or omission of any of the indemnified parties; (iii) a
severability of interest clause or endorsement; (iv) a provision (in endorsement
form if requested by Landlord) that the insurer or  insured will not cancel or
change the coverage provided by such policy without giving Landlord thirty
(30)days' prior written notice.

 

(2)Limits of liability specified herein can be satisfied through the maintenance
of a combination of primary and umbrella policies.

 

(3)To the extent permitted by Law, Tenant waives on behalf of itself and its
insurer all rights to assert claims for any losses, damages, liabilities, and
expenses, including but not limited to attorney's fees, against Landlord,
Landlord's subsidiaries and affiliates, and their respective directors,
officers, managers, Tenants and employees, for damages to the extent proceeds
realized from policies of insurance maintained or required to be maintained in
connection with services or products provided under this Agreement are applied
to such losses, damages, liabilities, and expenses. Each policy required herein
shall include an endorsement acknowledging such waiver of subrogation.

 

(4)Any and all of the deductibles and premiums associated with the policies
providing the insurance coverage required herein shall be assumed by, for the
account of, and at the sole risk of Tenant.

 

(5)All policies must be written on an occurrence basis and maintained without
interruption from the date of this Lease until the date of termination of this
Lease.

 

(6)Tenant shall furnish to Landlord upon execution of this Lease and thereafter
within ten (10) days of the renewal of any policy required herein a Certificate
of Liability Insurance on Acord 25 and a Certificate of Property Insurance on
Acord 28 or substitute equivalent forms approved by Landlord ("Certificates").
Certificates shall evidence the following for each and every policy providing
the insurance coverage required herein: (i) insurance company name, (ii) policy
number, (iii) policy period, (iv) per occurrence and aggregate limits, (v)
deductibles or self-insured retentions, and (vi) any applicable additional
insured or waiver of subrogation endorsements.

 

(7)Each insurance company listed in the Certificate shall be (i) admitted to do
business in the state where the Project is located and (ii) rated by AM Best
Company as having a financial strength rating of "A- " or better and a financial
size category of "VIII" or greater or otherwise be satisfactory to Landlord.

 

(8)A lack of insurance coverage does not reduce or limit Tenant's obligation to
indemnify Landlord as set forth in this Lease.

 

(c)Landlord’s Insurance. Landlord shall maintain property insurance covering
Landlord's owned real and personal property at the Property, in amounts and with
coverages as determined reasonably by Landlord but as is reasonable and
customary in the area for similar properties.

 

(d)No Subrogation; Waiver of Property Claims. Landlord and Tenant each waives
any claim it might have against the other for any damage to or theft,
destruction, loss, or loss of use of any property, to the extent the same is
insured against under any insurance policy of the types described in this
Section 11 that covers the Project, the Premises, Landlord's or Tenant's
fixtures, personal property, leasehold improvements, or business, or is required
to be insured against under the terms hereof, regardless of whether the
negligence of the other party caused such Loss (defined below). Additionally,
Tenant waives any claim it may have against Landlord for any  Loss to the extent
such Loss is caused by a terrorist act. Each party shall cause its insurance
carrier to endorse all applicable policies waiving the carrier's rights of
recovery under subrogation or otherwise against the other party. Notwithstanding
any provision in this Lease to the contrary, Landlord, its agents, employees and
contractors shall not be liable to Tenant or to any party claiming by, through
or under Tenant for (and Tenant hereby releases Landlord and its servants,
agents, contractors, employees and invitees from any claim or responsibility
for) any damage to or destruction, loss, or loss of use, or theft of any
property of any Tenant Party located in or about the Project, caused by
casualty, theft, fire, third parties or any other matter or cause, regardless of
whether the negligence of any party caused such loss in whole or in part. Tenant
acknowledges that Landlord shall not carry insurance on, and shall not be
responsible for damage to, any property of any Tenant Party located in or about
the Project.

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(e)Indemnity. Subject to Section 11(b), Tenant shall defend, indemnify, and hold
harmless Landlord and its representatives and agents from and against all
claims, demands, liabilities, causes of action, suits, judgments, damages, and
expenses (including reasonable attorneys' fees) arising from any injury to or
death of any person or the damage to or theft, destruction, loss, or loss of use
of, any property or inconvenience (a "Loss") (1) occurring in or on the Project
(other than within the Premises) to the extent caused by the negligence or
willful misconduct of any Tenant Party, (2) occurring in the Premises, or (3)
arising out of the installation, operation, maintenance, repair or removal of
any property of any Tenant Party located in or about the Project, including
Tenant's Off-Premises Equipment. It being agreed that clauses (2) and (3) of
this indemnity are intended to indemnify Landlord and its agents against the
consequences of their own negligence or fault, even when Landlord or its agents
are jointly, comparatively, contributively, or concurrently negligent with
Tenant, and even though any such claim, cause of action or suit is based upon or
alleged to be based upon the strict liability of Landlord or its agents;
however, such indemnity shall not apply to the gross negligence or willful
misconduct of Landlord, its employees and its agents. The indemnities set forth
in this Lease shall survive termination or expiration of this Lease and shall
not terminate or be waived, diminished or affected in any manner by any
abatement or apportionment of Rent under any provision of this Lease. If any
proceeding is filed for which indemnity is required hereunder, the indemnifying
party agrees, upon request therefor, to defend the indemnified party in such
proceeding at its sole cost utilizing counsel satisfactory to the indemnified
party. Landlord shall defend, indemnify, and hold Tenant harmless from and
against any Loss arising from any occurrence in or on the Building's common
areas to the extent caused by the gross negligence or willful misconduct of
Landlord, its employees or agents.

 

12.Subordination; Attornment; Notice to Landlord's Mortgagee.

 

(a)Subordination. This Lease shall be subordinate to any deed of trust,
mortgage, or other security instrument (each, a "Mortgage"), or any ground
lease, master lease, or primary lease (each, a "Primary Lease"), that now or
hereafter covers all or any part of the Premises (the mortgagee under any such
Mortgage, beneficiary under any such deed of trust, or the lessor under any such
Primary Lease is referred to herein as a "Landlord's Mortgagee"). Any Landlord's
Mortgagee may elect, at any time, unilaterally, to make this Lease superior to
its Mortgage, Primary Lease, or other interest in the Premises by so notifying
Tenant in writing. The provisions of this Section shall be self-operative and no
further instrument of subordination shall be required; however, in confirmation
of such subordination, Tenant shall execute and return to Landlord (or such
other party designated by Landlord) within ten days after written request
therefor a subordination, non-disturbance and attornment agreement, in
recordable form if required and on Landlord's Mortgagee's form, as a Landlord's
Mortgagee may reasonably request to evidence the subordination of this Lease to
such Landlord's Mortgagee's Mortgage or Primary Lease or, if the Landlord's
Mortgagee so elects, the subordination of such Landlord's Mortgagee's Mortgage
or Primary Lease to this Lease. All costs and expenses charged by Landlord's
Mortgagee to provide, draft, negotiate and finalize such documentation shall be
paid by Tenant within ten (10) days after Landlord gives to Tenant a reasonably
detailed statement therefor, not to exceed $5,000.00 for each such
subordination, non- disturbance and attornment agreement.

 

(b)Attornment. Tenant shall attorn to any party succeeding to Landlord's
interest in the Premises, whether by purchase, foreclosure, deed in lieu of
foreclosure, power of sale or otherwise, upon such party's request, and shall
execute such agreements confirming such attornment as such party may
reasonably  request.

 

(c)Notice to Landlord's Mortgagee. Tenant shall not seek to enforce any remedy
it may have for any default on the part of Landlord without first giving written
notice by certified mail, return receipt requested, specifying the default in
reasonable detail, to any Landlord's Mortgagee whose address has been given to
Tenant, and affording such Landlord's Mortgagee a reasonable opportunity to
perform Landlord's obligations hereunder.

 

(d)Landlord's Mortgagee's Protection Provisions. If Landlord's Mortgagee shall
succeed to the interest of Landlord under this Lease, Landlord's Mortgagee shall
not be: (1) liable for any act or omission of any prior lessor (including
Landlord) except to the extent of any offset pursuant to clause (6) of this
subsection (d) and except for in connection any maintenance or repair
obligations of Landlord under this Lease, if any, for which prior lessor failed
to perform and which remain at issue as of the date on which Landlord’s
Mortgagee acquires title to the Land, provided that Tenant has given Landlord’s
Mortgagee written notice of the same (provided however in no event shall
Landlord’s Mortgagee be liable for any damages or liability arising from or in
connection with any failure, act or omission of prior Landlord relating to such
maintenance or repairs); (2) bound by any Rent which Tenant has paid for more
than the current month to any prior lessor (including Landlord), and all such
rent shall remain due and owing; (3) bound by any security or advance rental
deposit made by Tenant which is not delivered or paid over to Landlord's
Mortgagee and with respect to which Tenant shall look solely to Landlord for
refund or reimbursement; (4) bound by any termination, amendment or modification
of this Lease made without Landlord's Mortgagee's consent and written approval,
except for those

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terminations, amendments and modifications permitted to be made by Landlord
without Landlord's Mortgagee's consent pursuant to the terms of the loan
documents between Landlord and Landlord's Mortgagee; (5) subject to the defenses
which Tenant might have against any prior lessor (including Landlord); and (6)
subject to the offsets which Tenant might have against any prior lessor
(including Landlord) except for those offset rights which (A) are expressly
provided in this Lease, (B) intentionally deleted, and (C) Tenant has provided
written notice to Landlord's Mortgagee and provided Landlord's Mortgagee a
reasonable opportunity to cure the event giving rise to such offset event.
Landlord's Mortgagee shall have no liability or responsibility under or pursuant
to the terms of this Lease or otherwise after it ceases to own an interest in
the Project. Nothing in this Lease shall be construed to require Landlord's
Mortgagee to see to the application of the proceeds of any loan, and Tenant's
agreements set forth herein shall not be impaired on account of any modification
of the documents evidencing and securing any loan.

 

13.Rules and Regulations. Tenant shall comply with the rules and regulations of
the Project which shall be provided to Tenant by Landlord. Landlord may, from
time to time, change such rules and regulations for the safety, care, or
cleanliness of the Project and related facilities, provided that such changes
are applicable to all tenants of the Project, will not unreasonably interfere
with Tenant's use of the Premises and are enforced by Landlord in a
non-discriminatory manner. Tenant shall be responsible for the compliance with
such rules and regulations by each Tenant Party.

 

14.Condemnation.

 

(a)Total Taking. If the entire Building or Premises are taken by right of
eminent domain or conveyed in lieu thereof (a "Taking"), this Lease shall
terminate as of the date of the Taking.

 

(b)Partial Taking - Tenant's Rights. If any part of the Building becomes subject
to a Taking and such Taking will prevent Tenant from conducting on a permanent
basis its business in the Premises in a manner reasonably comparable to that
conducted immediately before such Taking, then Tenant may terminate this Lease
as of the date of such Taking by giving written notice to Landlord within 30
days after the Taking, and Basic Rent and Additional Rent shall be apportioned
as of the date of such Taking. If Tenant does not terminate this  Lease, then
Rent shall be abated on a reasonable basis as to that portion of the Premises
rendered untenantable by the Taking.

 

(c)Partial Taking - Landlord's Rights. If any material portion, but less than
all, of the Building becomes subject to a Taking, or if Landlord is required to
pay any of the proceeds arising from a Taking to a Landlord's Mortgagee, then
Landlord may terminate this Lease by delivering written notice thereof to Tenant
within 30 days after such Taking, and Basic Rent and Additional Rent shall be
apportioned as of the date of such Taking. If Landlord does not so terminate
this Lease, then this Lease will continue, but if any portion of the Premises
has been taken, Rent shall abate as provided in the last sentence of Section
14(b).

 

(d)Temporary Taking. If all or any portion of the Premises becomes subject to a
Taking  for a limited period of time, this Lease shall remain in full force and
effect and Tenant shall continue to perform all of the terms, conditions and
covenants of this Lease, including the payment of Basic Rent and all other
amounts required hereunder. If any such temporary Taking terminates prior to the
expiration of the Term, Tenant shall  restore the Premises as nearly as possible
to the condition prior to such temporary Taking, at Tenant's sole cost and
expense. Landlord shall be entitled to receive the entire award for any such
temporary Taking, except that Tenant shall be entitled to receive the portion of
such award which (1) compensates Tenant for its loss of use of the Premises
within the Term and (2) reimburses Tenant for the reasonable out-of-pocket costs
actually incurred by Tenant to restore the Premises as required by this Section
14(d).

 

(e)Award. If any Taking occurs, then Landlord shall receive the entire award or
other compensation for the Land, the Building, and other improvements taken;
however, Tenant may separately pursue a claim (to the extent it will not reduce
Landlord's award) against the condemnor for the value of Tenant's personal
property which Tenant is entitled to remove under this Lease, moving costs, loss
of business, and other claims it  may have.

 

15.Fire or Other Casualty.

 

(a)Repair Estimate. If the Premises or the Building are damaged by fire or other
casualty  (a "Casualty"), Landlord shall, within 90 days after such Casualty,
deliver to Tenant a good faith estimate (the "Damage Notice") of the time needed
to repair the damage caused by such Casualty.

 

(b)Tenant's Rights. If a material portion of the Premises is damaged by Casualty
such that Tenant is prevented from conducting its business in the Premises in a
manner reasonably comparable to that conducted immediately before such Casualty
and Landlord estimates that the damage caused thereby cannot be repaired within
270 days after the commencement of repairs (the "Repair Period"), then Tenant
may terminate this Lease by delivering written notice to Landlord of its
election to terminate within 30 days after the Damage Notice has been delivered
to Tenant.

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(c)Landlord's Rights. If a Casualty damages the Premises or a material portion
of the Building and (1) Landlord estimates that the damage to the Premises
cannot be repaired within the Repair Period, (2) the damage to the Premises
exceeds 50% of the replacement cost thereof (excluding foundations and
footings), as estimated by Landlord, and such damage occurs during the last two
years of the Term, (3) regardless of the extent of damage to the Premises, the
damage is not fully covered by Landlord's insurance policies plus applicable
deductibles (provided that Landlord carries the insurance required hereunder) or
Landlord makes a good faith determination that restoring the Building would be
uneconomical (so long as in connection with such determination, Landlord has
terminated or provided notices of termination of leases of all other tenants of
the Building having premises similarly impacted by the casualty and where such
tenants' leases permitted such termination by Landlord), or (4) Landlord is
required to pay any insurance proceeds arising out of the Casualty to a
Landlord's Mortgagee such that the remaining insurance proceeds are insufficient
to cover at least 80% of the costs of restoration, then Landlord may terminate
this Lease by giving written notice of its election to terminate within 30 days
after the Damage Notice has been delivered to Tenant.

 

(d)Repair Obligation. If neither party elects to terminate this Lease following
a Casualty, then Landlord shall, within a reasonable time after such Casualty,
begin to repair the Premises and shall proceed with reasonable diligence to
restore the Premises to substantially the same condition as they existed
immediately before such Casualty; however, Landlord shall not be required to
repair or replace any alterations or betterments within the Premises (which
shall be promptly and with due diligence repaired and restored by Tenant at
Tenant's sole cost and expense) or any furniture, equipment, trade fixtures or
personal property of Tenant or others in the Premises or the Building, and
Landlord's obligation to repair or restore the Premises shall be limited to the
extent of the insurance proceeds actually received by Landlord for the Casualty
in question (plus applicable deductible amounts). If this Lease is terminated
under the provisions of this Section 15, Landlord shall be entitled to the full
proceeds of the insurance policies providing coverage for all alterations,
improvements and betterments in the Premises (and, if Tenant has failed to
maintain insurance on such items as required by this Lease, Tenant shall pay
Landlord an amount equal to the proceeds Landlord would have received had Tenant
maintained insurance on such items as required by this Lease).

 

(e)Abatement of Rent. If the Premises are damaged by Casualty, Rent for the
portion of  the Premises rendered untenantable by the damage shall be abated on
a reasonable basis from the date of damage until the completion of Landlord's
repairs (or until the date of termination of this Lease by Landlord or Tenant as
provided above, as the case may be), unless the gross negligence or willful
misconduct of a Tenant Party caused such damage, in which case, Tenant shall
continue to pay Rent without abatement.

 

(f)Lab Area. Notwithstanding the foregoing, if any casualty shall damage any
portion of the Building such that any restoration work must be performed in the
Lab Area, then Tenant, at its sole expense, shall obtain any license, clearance
or other authorization of any kind required to enter into the Premises to
commence such restoration work issued by any governmental authority having
jurisdiction over the use, storage, handling, treatment, generation, release,
disposal, removal or remediation of Hazardous Materials in, on, or about the
Premises.

 

16.Personal Property Taxes. Tenant shall be liable for all taxes levied or
assessed against personal property, furniture, or fixtures placed by Tenant in
the Premises or in or on the Building or Project. If any taxes for which Tenant
is liable are levied or assessed against Landlord or Landlord's property and
Landlord elects to pay the same, or if the assessed value of Landlord's property
is increased by inclusion of such personal property, furniture or fixtures and
Landlord elects to pay the taxes based on such increase, then Tenant shall pay
to Landlord, within 30 days following written request therefor, the part of such
taxes for which Tenant is primarily liable hereunder; however, Landlord shall
not pay such amount if Tenant notifies Landlord that it will contest the
validity or amount of such taxes before Landlord makes such payment, and
thereafter diligently proceeds with such contest in accordance with Law and if
the non-payment thereof does not pose a threat of loss or seizure of the Project
or interest of Landlord therein or impose any fee or penalty against Landlord.

 

17.Events of Default. Each of the following occurrences shall be an "Event of
Default":

 

(a)Payment Default. Tenant's failure to pay Rent within five business days of
the date due, which failure continues for five days after Landlord has delivered
written notice to Tenant that the same is due; however, an Event of Default
shall occur hereunder without any obligation of Landlord to give any notice if
Tenant fails to pay Rent within five business days of the date due and, during
the 12 month interval preceding such failure, Landlord has given Tenant written
notice of failure to pay Rent on one or more occasions;

 

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(b)Abandonment. Tenant (1) abandons or vacates the Premises or any substantial
portion thereof or (2) fails to continuously operate its business in the
Premises except during any periods of renovation or remodeling (provided that
such failure to continuously operate Tenant's business in the Premises due to
any period of renovation and/or remodeling shall not exceed six months);

 

(c)Estoppel. Tenant fails to provide any estoppel certificate after Landlord's
written request therefor pursuant to Section 25(e) and such failure shall
continue for seven (7) days after Landlord's second written notice thereof to
Tenant;

 

(d)Insurance. Tenant fails to procure, maintain and deliver to Landlord evidence
of the insurance policies and coverages as required under Section 11(a);

 

(e)Mechanic's Liens. Tenant fails to pay and release of record, or diligently
contest and bond around, any mechanic's lien filed against the Premises or the
Project for any work performed, materials furnished, or obligation incurred by
or at the request of Tenant, within the time and in the manner required by
Section 8(d);

 

(f)Other Defaults. Tenant's failure to perform, comply with, or observe any
other agreement or obligation of Tenant under this Lease and the continuance of
such failure for a period of more than 30 days after Landlord has delivered to
Tenant written notice thereof; however, if such failure cannot be cured within
such 30-day period (thus excluding, for example, Tenant's obligation to provide
Landlord evidence of Tenant's insurance coverage) and Tenant commences to cure
such failure within such 30-day period and thereafter diligently pursues such
cure to completion, then such failure shall not be an Event of Default unless it
is not fully cured within an additional 45 days after the expiration of the
30-day period; and

 

(g)Insolvency. The filing of a petition by or against Tenant (the term
"Tenant"  shall include, for the purpose of this Section 17(g), any guarantor of
Tenant's obligations hereunder) (1) in any  bankruptcy or other insolvency
proceeding; (2) seeking any relief under any state or federal debtor relief law;
(3) for the appointment of a liquidator or receiver for all or substantially all
of Tenant's property or for Tenant's interest in this Lease; (4) for the
reorganization or modification of Tenant's capital structure; or (5) in any
assignment for the benefit of creditors proceeding; however, if such a petition
is filed against Tenant, then such filing shall not be an Event of Default
unless Tenant fails to have the proceedings initiated by such petition dismissed
within 90 days after the filing thereof.

 

18.Remedies. Upon any Event of Default, Landlord may, in addition to all other
rights and remedies afforded Landlord hereunder or by law or equity, take any
one or more of the following actions:

 

(a)Termination of Lease. Terminate this Lease by giving Tenant written notice
thereof, in which event Tenant shall pay to Landlord the sum of (1) all Rent
accrued but unpaid hereunder through the date of termination, (2) all amounts
due under Section 19(a), and (3) an amount equal to (A) the total Rent that
Tenant would have been required to pay for the remainder of the Term discounted
to present value at a per annum rate equal to the "Prime Rate" as published on
the date this Lease is terminated by The Wall Street Journal, Southwest Edition,
in its listing of "Money Rates" minus one percent, minus (B) the then present
fair rental value of the Premises for such period, similarly discounted;

 

(b)Termination of Possession. Terminate Tenant's right to possess the Premises
without terminating this Lease by giving written notice thereof to Tenant, in
which event Tenant shall pay to Landlord (1) all Rent and other amounts accrued
hereunder to the date of termination of possession, (2) all amounts due from
time to time under Section 19(a), and (3) all Rent and other net sums required
hereunder to be paid by Tenant during the remainder of the Term, diminished by
any net sums thereafter received by Landlord through reletting the Premises
during such period, after deducting all reasonable costs incurred by Landlord in
reletting the Premises. If Landlord elects to proceed under this Section 18(b),
Landlord may remove all of Tenant's property from the Premises and store the
same in a public warehouse or elsewhere at the cost of, and for the account of,
Tenant, without becoming liable for any loss or damage which may be occasioned
thereby. Landlord shall use reasonable efforts to relet the Premises on such
terms as Landlord in its sole reasonable discretion may determine (including a
term different from the Term, rental concessions, and alterations to, and
improvement of, the Premises); however, Landlord shall not be obligated to relet
the Premises before leasing other portions of the Building or Complex and
Landlord shall not be obligated to accept any prospective tenant unless such
proposed tenant meets all of Landlord's leasing criteria.

 

Landlord shall not be liable for, nor shall Tenant's obligations hereunder be
diminished because of, Landlord's failure to relet the Premises or to collect
rent due for such reletting. Tenant shall not be entitled to the excess of any
consideration obtained by reletting over the Rent due hereunder. Reentry by
Landlord in the Premises shall not affect Tenant's obligations

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hereunder for the unexpired Term; rather, Landlord may, from time to time, bring
an action against Tenant to collect amounts due by Tenant, without the necessity
of Landlord's waiting until the expiration of the Term. Unless Landlord delivers
written notice to Tenant expressly stating that it has elected to terminate this
Lease, all actions taken by Landlord to dispossess or exclude Tenant from the
Premises shall be deemed to be taken under this Section 18(b). If Landlord
elects to proceed under this Section 18(b), it may at any time elect to
terminate this Lease under Section 18(a);

 

(c)Perform Acts on Behalf of Tenant. Perform any act Tenant is obligated to
perform under the terms of this Lease (and enter upon the Premises in connection
therewith if necessary) in Tenant's name and on Tenant's behalf, without being
liable for any claim for damages therefor, except to the extent caused by
Landlord's gross negligence or willful misconduct in performing such obligation,
and Tenant shall reimburse Landlord on demand for any reasonable expenses which
Landlord may incur in thus effecting compliance with Tenant's obligations under
this Lease (including, but not limited to, collection costs and legal expenses),
plus interest thereon at the Default Rate;

 

(d)Suspension of Services. Suspend any services required to be provided by
Landlord hereunder without being liable for any claim for damages therefor; or

 

(e)Alteration of Locks. Additionally, with or without notice, and to the extent
permitted by Law, Landlord may alter locks or other security devices at the
Premises to deprive Tenant of access thereto, and Landlord shall not be required
to provide a new key or right of access to Tenant.

 

19.Payment by Tenant; Non-Waiver; Cumulative Remedies.

 

(a)Payment by Tenant. Upon any Event of Default, Tenant shall pay to Landlord
all costs incurred by Landlord (including court costs and reasonable attorneys'
fees and expenses) in (1) obtaining possession of the Premises, (2) removing and
storing Tenant's or any other occupant's property, (3) repairing, restoring,
altering, remodeling, or otherwise putting the Premises into the condition
required at the expiration of the Term, (4) if Tenant is dispossessed of the
Premises and this Lease is not terminated, reletting all or any part of the
Premises (including reasonable brokerage commissions, cost of tenant finish
work, and other costs incidental to such reletting), (5) performing Tenant's
obligations which Tenant failed to perform, and (6) enforcing, or advising
Landlord of, its rights, remedies, and recourses arising out of the default. To
the full extent permitted by law, Landlord and Tenant agree the federal and
state courts of the state in which the Premises are located shall have exclusive
jurisdiction over any matter relating to or arising from this Lease and the
parties' rights and obligations under this Lease.

 

(b)No Waiver. Landlord's acceptance of Rent following an Event of Default shall
not  waive Landlord's rights regarding such Event of Default. No waiver by
Landlord of any violation or breach of any  of the terms contained herein shall
waive Landlord's rights regarding any future violation of such term. Landlord's
acceptance of any partial payment of Rent shall not waive Landlord's rights with
regard to the remaining portion of the Rent that is due, regardless of any
endorsement or other statement on any instrument delivered in payment of Rent or
any writing delivered in connection therewith; accordingly, Landlord's
acceptance of a partial payment of Rent shall not constitute an accord and
satisfaction of the full amount of the Rent that is due.

 

(c)Cumulative Remedies. Any and all remedies set forth in this Lease: (1) shall
be in addition to any and all other remedies Landlord may have at law or in
equity, (2) shall be cumulative, and (3) may be pursued successively or
concurrently as Landlord may elect. The exercise of any remedy by Landlord shall
not  be deemed an election of remedies or preclude Landlord from exercising any
other remedies in the future.

 

20.Landlord's Lien. In addition to any statutory landlord's lien, now or
hereafter enacted, Tenant grants to Landlord, to secure performance of Tenant's
obligations hereunder, a security interest in all of Tenant's property situated
in or upon, or used in connection with, the Premises or the Project, and all
proceeds thereof (except merchandise sold in the ordinary course of business)
(collectively, the "Collateral"), and the Collateral shall not be removed from
the Premises or the Project without the prior written consent of Landlord until
all obligations of Tenant have been fully performed. Such personalty thus
encumbered includes specifically all trade and other fixtures for the purpose of
this Section 20 and inventory, equipment, contract rights, accounts receivable
and the proceeds thereof. Upon the occurrence of an Event of Default, Landlord
may, in addition to all other remedies, without notice or demand except as
provided below, exercise the rights afforded to a secured party under the
Uniform Commercial Code of the state in which the Premises are located (the
"UCC"). To the extent the UCC requires Landlord to give to Tenant notice of any
act or event and such notice cannot be validly waived before a default occurs,
then five-days' prior written notice thereof shall be reasonable notice of the
act or event. In order to perfect such security interest, Landlord may file any
financing statement or other instrument necessary at Tenant's expense at the
state and county Uniform Commercial Code filing offices. Tenant grants to
Landlord a power of

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attorney to execute and file any financing statement or other necessary
instrument to perfect Landlord's security interest under this Section 20, which
power is coupled with an interest and is irrevocable during the Term.  Landlord
may also file a copy of this Lease as a financing statement to perfect its
security interest in the Collateral. Within ten days following written request
therefor, Tenant shall execute financing statements to be filed of record to
perfect Landlord's security interest in the Collateral.

 

21.Surrender of Premises.

 

(a)General Surrender Provisions. No act by Landlord shall be deemed an
acceptance of a surrender of the Premises, and no agreement to accept a
surrender of the Premises shall be valid unless it is in writing and signed by
Landlord. At the expiration or termination of this Lease, Tenant shall deliver
to Landlord the Premises with all improvements located therein in good repair
and condition, free of Hazardous Materials placed on the Premises during the
Term, broom-clean, reasonable wear and tear (and condemnation and Casualty
damage not caused by Tenant, as to which Sections 14 and 15 shall control)
excepted, and shall deliver to Landlord all keys to the Premises. Provided no
default then exists under this Lease, Tenant may remove all unattached trade
fixtures, furniture, movable equipment and personal property placed in the
Premises or elsewhere in the Building by Tenant (but Tenant may not remove any
such item which was paid for, in whole or in part, by Landlord or any wiring or
cabling unless Landlord requires such removal). Additionally, subject to Section
21(b), Tenant shall remove such trade fixtures, personal property, equipment,
wiring, conduits, cabling, and furniture (including Tenant's Off- Premises
Equipment) as Landlord requests; however, Tenant shall not be required to remove
any addition or improvement to the Premises or the Project if Landlord has
specifically agreed in writing at the time such plans were approved by Landlord
that the improvement or addition in question need not be removed. Tenant shall
repair and restore, in a good and workmanlike manner, all damage caused by such
removal, and if Tenant fails to do so, Tenant shall reimburse Landlord, on
demand, for Landlord's cost of repairing and restoring such damage. All items
not so removed shall, at Landlord's option, be deemed to have been abandoned by
Tenant and may be appropriated, sold, stored, destroyed, or otherwise disposed
of by Landlord at Tenant's cost but without notice to Tenant and without any
obligation to account for such items, and without liability to or recourse by
Tenant or anyone claiming by, through or under Tenant; any such disposition
shall not be considered a strict foreclosure or other exercise of Landlord's
rights in respect of the security interest granted under Section 20. Further,
Tenant shall deliver to Landlord the Premises with the Lab Area converted to
"general open office condition" and the common area  corridor between Suite 100
and 110 retrofitted and restored to "building standard condition" and the
configuration as existed prior to the date of this Lease. For the avoidance of
doubt, the above provisions shall also apply to any and all improvements that
Tenant makes outside of the Premises, in the remainder of the Building, on the
roof of the Building, or on the exterior of the Building. The provisions of this
Section 21 shall survive the end of the Term.

 

(b)Lab Area Surrender. Tenant shall clean and otherwise decommission all
interior surfaces (including floors, walls, ceilings, and counters), piping,
supply lines, waste lines, disposal apparatus, containment apparatus, acid
neutralization systems, plumbing and other equipment and systems in and/or
exclusively serving the Lab Area, and all air-scrubbers, air-handlers, exhaust
or other ductwork in and/or exclusively serving the Lab Area, in each case which
has carried or released or been contacted by any chemical or biological
materials used in the operation of the Lab Area, and shall otherwise clean the
Lab Area so as to permit the Surrender Plan (defined below) to be issued, on or
before, as the case may be: (i) the expiration of this Lease, (ii) the
date  thirty (30) days after any earlier termination based upon any Default of
Tenant in its obligations under the Lease, or (iii) as soon as reasonably
possible after any earlier termination arising from any reason other than any
Default of Tenant in its obligations under the Lease, as the case may be. At
least thirty (30) days prior to the expiration of the Term (or, if applicable,
within ten (10) Business Days after any earlier termination of this Lease),
Tenant shall deliver to Landlord a reasonably detailed narrative description of
the actions proposed (or required by any Legal Requirements) to be taken by
Tenant in order to render the Premises available for unrestricted use and
occupancy (the "Surrender Plan"). Such Surrender Plan shall be accompanied by a
current listing of (x) all Hazardous Materials licenses and permits and medical
waste licenses and permits held by or on behalf of Tenant with respect to the
Premises, and (y) all Hazardous Materials and medical waste used, stored,
handled, treated, generated, released or disposed of from the Premises by
Tenant. In connection with the review and approval of the Surrender Plan, which
approval shall not be unreasonably withheld, conditioned, or delayed, upon the
written request of Landlord, Tenant shall deliver to Landlord or its consultant
such additional non-proprietary information concerning the use of and operations
within the Premises as Landlord shall reasonably request. On or before the
expiration of the Term  (or within thirty (30) days after any earlier
termination of this Lease), Tenant shall deliver to Landlord a certification
("Hygienist Certification") from a third party certified industrial hygienist
reasonably acceptable to Landlord certifying that the Premises do not contain
any Hazardous Materials and evidence that the approved Surrender Plan shall have
been satisfactorily completed by a contractor reasonably acceptable to Landlord,
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 expiration of the Term
(or, if applicable,

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the date which is thirty (30) days after any earlier termination of this Lease),
free of Hazardous Materials and otherwise available for unrestricted use and
occupancy as aforesaid. Landlord shall have the unrestricted right to deliver
the Surrender Plan and any report by Landlord's environmental consultant with
respect to the surrender of the Premises to third parties. Such third parties
and Landlord, any affiliate of Landlord, Landlord's managing agents for the
Building, each mortgagee (if any), each ground lessor (if any), and each of
their respective direct or indirect partners, officers, shareholders, directors,
members, trustees, beneficiaries, servants, employees, principals, contractors,
licensees, agents or representatives shall be entitled to rely on the Surrender
Plan. 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, then
following notice to Tenant of such failure and Tenant's failure to commence a
cure within ten (10) days of the delivery of such notice and to complete such
cure within thirty (30) days of the delivery of such notice, Landlord shall have
the right to take such actions as are reasonably necessary to assure that the
Premises are surrendered in the condition required hereunder, the cost of which
actions shall be reimbursed by Tenant as Additional Rent upon demand. For the
avoidance of doubt, the foregoing provisions shall also apply to any and all
specialty Improvements that Tenant makes outside of the Premises that serve the
Lab Area. Tenant's obligations under this Section 21 shall survive the
expiration or earlier termination of the Term.

 

22.Holding Over. If Tenant fails to vacate the Premises at the end of the Term,
then Tenant shall be  a tenant at sufferance and (a) Tenant shall pay, in
addition to the other Rent, Basic Rent equal to 150% of the Rent payable during
the last month of the Term, and (b) Tenant shall otherwise continue to be
subject to all of Tenant's obligations under this Lease. The provisions of this
Section 22 shall not be deemed to limit or constitute a waiver  of any other
rights or remedies of Landlord provided herein or at law. If Tenant fails to
surrender the Premises upon the termination or expiration of this Lease, in
addition to any other liabilities to Landlord accruing therefrom, Tenant shall
protect, defend, indemnify and hold Landlord harmless from all loss, costs
(including reasonable attorneys' fees) and liability resulting from such
failure, including any claims made by any succeeding tenant founded upon such
failure to surrender, and any lost profits to Landlord resulting therefrom;
provided, however, that such indemnification obligation shall not arise until
the expiration of ten (10) days following the last day of the Term.

 

23.Certain Rights Reserved by Landlord. Provided that the exercise of such
rights does not unreasonably interfere with Tenant's occupancy of the Premises,
Landlord shall have the following rights:

 

(a)Building Operations. To decorate and to make inspections, repairs,
alterations, additions, changes, or improvements, whether structural or
otherwise, in and about the Project, or any part thereof; to enter upon the
Premises (after giving Tenant reasonable notice thereof, which may be oral
notice, except in cases of real or apparent emergency, in which case no notice
shall be required) and, during the continuance of any such work, to temporarily
close doors, entryways, public space, and corridors in the Building; to
interrupt or temporarily suspend Building services and facilities; to change the
name of the Building; and to change the arrangement and location of entrances or
passageways, doors, and doorways, corridors, elevators, stairs, restrooms, or
other public parts of the Building;

 

(b)Security. To take such reasonable measures as Landlord deems advisable
for  the security of the Building and its occupants; evacuating the Building for
cause, suspected cause, or for drill purposes; temporarily denying access to the
Building; and closing the Building after normal business hours and on Sundays
and holidays, subject, however, to Tenant's right to enter when the Building is
closed after normal business hours under such reasonable regulations as Landlord
may prescribe from time to time;

 

(c)Prospective Purchasers and Lenders. To enter the Premises at all reasonable
hours, upon reasonable prior notice, to show the Premises to prospective
purchasers or lenders; and

 

(d)Prospective Tenants. At any time during the last 12 months of the Term (or
earlier if Tenant has notified Landlord in writing that it does not desire to
renew the Term) or at any time following the occurrence of an Event of Default
which remains uncured, to enter the Premises at all reasonable hours, upon
reasonable prior notice, to show the Premises to prospective tenants.

 

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24.Intentionally Omitted.

 

25.Miscellaneous.

 

(a)Landlord Transfer. Landlord may transfer any portion of the Project and any
of its rights under this Lease. If Landlord assigns its rights under this Lease,
then Landlord shall thereby be released from any further obligations hereunder
arising after the date of transfer, provided that the assignee assumes in
writing Landlord's obligations hereunder arising from and after the transfer
date.

 

(b)Landlord's Liability. The liability of Landlord (and its partners,
shareholders or members) to Tenant (or any person or entity claiming by, through
or under Tenant) for any default by Landlord under the terms of this Lease or
any matter relating to or arising out of the occupancy or use of the Premises
and/or other areas of the Building shall be limited to Tenant's actual direct,
but not consequential, damages therefor and shall be recoverable only from the
interest of Landlord in the Building, and Landlord (and its partners,
shareholders or members) shall not be personally liable for any deficiency. The
provisions of this Section shall survive any expiration or termination of this
Lease. Additionally, Tenant hereby waives its statutory lien under Section
91.004  of the Texas Property Code.

 

(c)Force Majeure. Other than for Tenant's obligations under this Lease that can
be performed by the payment of money (e.g., payment of Rent and maintenance of
insurance), whenever a period of time is herein prescribed for action to be
taken by either party hereto, such party shall not be liable or responsible for,
and there shall be excluded from the computation of any such period of time, any
delays due to strikes, riots, acts of God, shortages of labor or materials, war,
terrorist acts or activities, governmental laws, regulations, or restrictions,
or any other causes of any kind whatsoever which are beyond the control of such
party.

 

(d)Brokerage. Neither Landlord nor Tenant has dealt with any broker or agent in
connection with the negotiation or execution of this Lease, other than Elevate
Growth Partners, L.L.C., representing Tenant and Peloton Commercial Real Estate,
representing Landlord, whose commission shall be paid by Landlord pursuant to a
separate written agreement. Tenant and Landlord shall each indemnify the other
against all costs, expenses, attorneys' fees, liens and other liability for
commissions or other compensation claimed by any other broker or agent claiming
the same by, through, or under the indemnifying party.

 

(e)Estoppel Certificates. From time to time, Tenant shall furnish to any party
designated  by Landlord, within ten days after Landlord has made a request
therefor, a certificate signed by Tenant confirming and containing such factual
certifications and representations as to this Lease as Landlord may reasonably
request, including certifying the following: (i) that this Lease is unmodified
and in full force and effect (or, if there have  been any modifications, that
this Lease is in full force and effect, as modified, and stating the
modifications), (ii) that Tenant has no defenses, offsets or counterclaims
against its obligations to pay rent and other charges required under this Lease
and to perform its other covenants under this Lease and that there are no
uncured defaults of Landlord or Tenant under this Lease (or, if there are any
defenses, offsets, counterclaims or defaults, setting them forth in reasonable
detail), (iii) the dates to which the Rent and other charges have been paid, and
(iv) any other factual information reasonably requested by Landlord. If Tenant
does not deliver to Landlord the certificate signed by Tenant within such
required time period, Landlord, Landlord's Mortgagee and any prospective
purchaser or mortgagee, may conclusively presume and rely upon the following
facts: (1) this Lease is in full force and effect; (2) the terms and provisions
of this Lease have not been changed except as otherwise represented by Landlord;
(3) not more than one monthly installment of Basic Rent and other charges have
been paid in advance; (4) there are no claims against Landlord nor any defenses
or rights of offset against collection of Rent or other charges; and (5)
Landlord is not in default under this Lease. In such event, Tenant shall be
estopped from denying the truth of the presumed facts.

 

(f)Notices. All notices and other communications given pursuant to this Lease
shall be in writing and shall be (1) sent via electronic mail transmission, (2)
hand delivered to the intended addressee, (3) sent by a nationally recognized
overnight courier service, or (4) sent by facsimile transmission during normal
business hours. All notices shall be effective upon delivery to the addressee
(even if such addressee refuses delivery thereof); provided, however, that
notices sent by electronic mail transmission must be followed by one other
method permitted in this paragraph. The parties hereto may change their
addresses by giving notice thereof to the other in conformity with this
provision.

 

(g)Separability. If any clause or provision of this Lease is illegal, invalid,
or unenforceable under present or future laws, then the remainder of this Lease
shall not be affected thereby and in lieu of such clause or provision, there
shall be added as a part of this Lease a clause or provision as similar in terms
to such illegal, invalid, or unenforceable clause or provision as may be
possible and be legal, valid, and enforceable.

 

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(h)Amendments; Binding Effect; No Electronic Records. This Lease may not be
amended except by instrument in writing signed by Landlord and Tenant. No
provision of this Lease shall be deemed to have been waived by Landlord unless
such waiver is in writing signed by Landlord, and no custom or practice which
may evolve between the parties in the administration of the terms hereof shall
waive or diminish the right of Landlord to insist upon the performance by Tenant
in strict accordance with the terms hereof. Landlord and Tenant hereby agree not
to conduct the transactions or communications contemplated by this Lease by
electronic means, except by electronic mail or facsimile transmission as
specifically set forth in Section 25(f); nor shall the use of the phrase "in
writing" or the word "written" be construed to include electronic communications
except by electronic mail or facsimile transmissions as specifically set forth
in Section 25(f). The terms and conditions contained in this Lease shall inure
to the benefit of and be binding upon the parties hereto, and upon their
respective successors in interest and legal representatives, except as otherwise
herein expressly provided. This Lease is for the sole benefit of Landlord and
Tenant, and, other than Landlord's Mortgagee, no third party shall be deemed a
third party beneficiary hereof.

 

(i)Quiet Enjoyment. Provided Tenant has performed all of its obligations
hereunder, Tenant shall peaceably and quietly hold and enjoy the Premises for
the Term, without hindrance from Landlord or any party claiming by, through, or
under Landlord, but not otherwise, subject to the terms and conditions of this
Lease.

 

(j)No Merger. There shall be no merger of the leasehold estate hereby created
with the fee estate in the Premises or any part thereof if the same person
acquires or holds, directly or indirectly, this Lease or any interest in this
Lease and the fee estate in the leasehold Premises or any interest in such fee
estate.

 

(k)No Offer. The submission of this Lease to Tenant shall not be construed as an
offer, and Tenant shall not have any rights under this Lease unless Landlord
executes a copy of this Lease and delivers it to Tenant.

 

(l)Entire Agreement. This Lease constitutes the entire agreement between
Landlord and Tenant regarding the subject matter hereof and supersedes all oral
statements and prior writings relating thereto. Except for those set forth in
this Lease, no representations, warranties, or agreements have been made by
Landlord or Tenant to the other with respect to this Lease or the obligations of
Landlord or Tenant in connection therewith. The normal rule of construction that
any ambiguities be resolved against the drafting party shall not apply to the
interpretation of this Lease or any exhibits or amendments hereto.

 

(m)Waiver of Jury Trial. TO THE MAXIMUM EXTENT PERMITTED BY LAW, LANDLORD AND
TENANT EACH WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY LITIGATION OR TO HAVE A JURY
PARTICIPATE IN RESOLVING ANY DISPUTE ARISING OUT OF OR WITH RESPECT TO THIS
LEASE OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO.

 

(n)Governing Law. This Lease shall be governed by and construed in accordance
with the laws of the state in which the Premises are located.

 

(o)Recording. Tenant shall not record this Lease or any memorandum of this Lease
without the prior written consent of Landlord, which consent may be withheld or
denied in the sole and absolute discretion of Landlord, and any recordation by
Tenant shall be a material breach of this Lease. Tenant grants to Landlord a
power of attorney to execute and record a release releasing any such recorded
instrument of record that was recorded without the prior written consent of
Landlord.

 

(p)Water or Mold Notification. To the extent Tenant or its agents or employees
discover any water leakage, water damage or mold in or about the Premises or
Project, Tenant shall promptly notify Landlord thereof in writing.

 

(q)Joint and Several Liability. If Tenant is comprised of more than one party,
each such party shall be jointly and severally liable for Tenant's obligations
under this Lease. All unperformed obligations of Tenant hereunder not fully
performed at the end of the Term shall survive the end of the Term, including
payment obligations with respect to Rent and all obligations concerning the
condition and repair of the Premises.

 

(r)Financial Reports. Within 15 days after Landlord's request, Tenant will
furnish Tenant's most recent audited financial statements (including any notes
to them) to Landlord, or, if no such audited statements have been prepared, such
other financial statements (and notes to them) as may have been prepared by an
independent certified public accountant or, failing those, Tenant's internally
prepared financial statements. Landlord will not disclose any aspect of

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Tenant's financial statements that Tenant designates to Landlord as confidential
except (1) to Landlord's Mortgagee or prospective mortgagees or purchasers of
the Building, (2) in litigation between Landlord and Tenant, and/or (3) if
required by court order. Tenant shall not be required to deliver the financial
statements required under this Section 25(r) more than once in any 12-month
period unless requested by Landlord's Mortgagee or a prospective buyer or lender
of the Building or an Event of Default occurs. So long as Tenant is a
publicly-traded company on a recognized exchange, Tenant shall not be required
to furnish to Landlord financial statements pursuant to this Section 25(r).

 

(s)Landlord's Fees. Whenever Tenant requests Landlord to take any action not
required of it hereunder or give any consent required or permitted under this
Lease, Tenant will reimburse Landlord for Landlord's reasonable, out-of-pocket
costs payable to third parties and incurred by Landlord in reviewing the
proposed action or consent, including reasonable attorneys', engineers' or
architects' fees, within 30 days after Landlord's delivery to Tenant of a
statement of such costs. Tenant will be obligated to make such reimbursement
without regard to whether Landlord consents to any such proposed action. If
Landlord reasonably believes the out- of-pocket costs payable to third parties
to be incurred by Landlord in reviewing the proposed action or consent will
exceed $2,500, Landlord will first notify Tenant of such cost estimate before
proceeding with such third-party expenses. If Tenant fails to consent to such
additional costs and expenses within five business days after Landlord’s written
notification to Tenant thereof, Tenant shall be deemed to have rescinded its
request for such action or consent.

 

(t)Telecommunications. Tenant and its telecommunications companies, including
local exchange telecommunications companies and alternative access vendor
services companies, shall have no right of access to and within the Building,
for the installation and operation of telecommunications systems, including
voice, video, data, Internet, and any other services provided over wire, fiber
optic, microwave, wireless, and any other transmission systems
("Telecommunications Services"), for part or all of Tenant's telecommunications
within the Building and from the Building to any other location without
Landlord's prior written consent, not to be unreasonably withheld. All providers
of Telecommunications Services shall be required to comply with the rules and
regulations of the Building, applicable Laws and Landlord's policies and
practices for the Building. Tenant acknowledges that Landlord shall not be
required to provide or arrange for any Telecommunications Services and that
Landlord shall have no liability to any Tenant Party in connection with the
installation, operation or maintenance of Telecommunications Services or any
equipment or facilities relating thereto. Tenant, at its cost and for its own
account, shall be solely responsible for obtaining all Telecommunications
Services.

 

(u)Confidentiality. Tenant acknowledges that the terms and conditions of this
Lease are to remain confidential for Landlord's benefit, and may not be
disclosed by Tenant to anyone, by any manner or means, directly or indirectly,
without Landlord's prior written consent; however, Tenant may disclose the terms
and conditions of this Lease if required by Law or court order, to its
attorneys, accountants, employees and existing or prospective financial partners
provided same are advised by Tenant of the confidential nature of such terms and
conditions and agree to maintain the confidentiality thereof (in each case,
prior to disclosure). Tenant shall be liable for any disclosures made in
violation of this Section by Tenant or by any entity or individual to whom the
terms of and conditions of this Lease were disclosed or made available by
Tenant. The consent by Landlord to any disclosures shall not be deemed to be a
waiver on the part of Landlord of any prohibition against any future disclosure.

 

(v)Authority. Tenant (if a corporation, partnership or other business entity)
hereby represents and warrants to Landlord that Tenant is a duly formed and
existing entity qualified to do business in the state in which the Premises are
located, that Tenant has full right and authority to execute and deliver this
Lease, and that each person signing on behalf of Tenant is authorized to do so.

 

(w)Hazardous Materials. The term "Hazardous Materials" means any substance,
material, or waste which is now or hereafter classified or considered to be
hazardous, toxic, or dangerous under any Law relating to pollution or the
protection or regulation of human health, natural resources or the environment,
or poses or threatens to pose a hazard to the health or safety of persons on the
Premises or in the Project. Subject to Section 9(c), Tenant shall not use,
generate, store, or dispose of, or permit the use, generation, storage or
disposal of Hazardous Materials on or about the Premises or the Project except
in a manner and quantity necessary for the ordinary performance of Tenant's
business, and then in compliance with all Laws. If Tenant breaches its
obligations under this Section 25(w), Landlord may immediately take any and all
action reasonably appropriate to remedy the same, including taking all
appropriate action to clean up or remediate any contamination resulting from
Tenant's use, generation, storage or disposal of Hazardous Materials. Tenant
shall not undertake, nor shall Tenant permit any Tenant Party to undertake, any
invasive investigation, drilling or sampling of the soil or groundwater at the
Premises, the Building, the Project or the Complex without the prior written
consent of Landlord, which consent shall be in Landlord's sole discretion.
TENANT SHALL DEFEND, INDEMNIFY, AND HOLD HARMLESS LANDLORD AND ITS
REPRESENTATIVES AND AGENTS FROM AND AGAINST ANY AND

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ALL CLAIMS, DEMANDS, LIABILITIES, CAUSES OF ACTION, SUITS, JUDGMENTS, DAMAGES
AND EXPENSES (INCLUDING REASONABLE ATTORNEYS' FEES AND COST OF CLEANUP AND
REMEDIATION) ARISING FROM TENANT'S FAILURE TO COMPLY WITH THE PROVISIONS OF THIS
SECTION 25(W). THIS INDEMNITY PROVISION SHALL SURVIVE TERMINATION OR EXPIRATION
OF THIS LEASE.

 

(x)List of Exhibits. All exhibits and attachments attached hereto are
incorporated herein by

this reference.

 

Exhibit A - Outline of Premises

Exhibit B - Description of the Land

Exhibit C – Tenant Finish-Work

Exhibit D – Building Sign

Exhibit E - Parking

Exhibit F - Renewal Option

Exhibit G – Right of First Refusal

Exhibit G-1 – Refusal Space

Exhibit G-2 – Form of Offer Notice

Exhibit H - Waiver of Consumer Rights

Exhibit I – Rent Abatement Provisions

Exhibit J – Lab Area - Permitted Use

 

(y)Determination of Charges. Landlord and Tenant agree that each provision of
this Lease for determining charges and amounts payable by Tenant (including
provisions regarding Additional Rent and Tenant's Proportionate Share of Taxes
and Electrical Costs) is commercially reasonable and, as to each such charge or
amount, constitutes a statement of the amount of the charge or a method by which
the charge is to be computed for purposes of Section 93.012 of the Texas
Property Code.

 

(z)Prohibited Persons and Transactions. Tenant represents and warrants to
Landlord that Tenant is currently in compliance with and shall at all times
during the Term (including any extension thereof) remain in compliance with the
regulations of the OFAC of the Department of the Treasury (including those named
on OFAC's Specially Designated Nationals and Blocked Persons List) and any
statute, executive order (including the September 24, 2001, Executive Order
Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten
to Commit or Support Terrorism), or other governmental action relating thereto.

 

26.Letter of Credit.

 

(a)General Provisions. Concurrent with the execution of this Lease, Tenant has
delivered  to Landlord a Letter of Credit (as hereinafter defined) in the amount
specified in the Basic Lease Information of this Lease, as security for the
faithful performance and observance by Tenant of the terms, covenants and
conditions of this Lease. The Letter of Credit shall be in the form of a clean,
irrevocable, non-documentary and unconditional letter of credit (the "Letter of
Credit") issued by and drawable upon a commercial bank which is satisfactory to
Landlord (the "Issuing Bank"), which has outstanding unsecured, uninsured and
unguaranteed indebtedness, or shall have issued a letter of credit or other
credit facility that constitutes the primary security for any outstanding
indebtedness (which is otherwise uninsured and unguaranteed), that is then
rated, without regard to qualification of such rating by symbols such as "+" or
"-" or numerical notation, "Aa" or better by Moody's Investors Service and "AA"
or better by Standard & Poor's Rating Service, and has combined capital, surplus
and undivided profits of not less than $2,000,000,000. The Letter of Credit
shall (i) name Landlord as beneficiary, (ii) have a term of not less than one
year, (iii) permit multiple drawings, (iv) either (x) be fully transferable by
Landlord without the payment of any fees or charges by Landlord, or (y) Tenant
shall be obligated to cause a replacement Letter of Credit to be issued for the
benefit of Landlord's transferee, at no fee or charge to Landlord, subject only
to the return of the original Letter of Credit, and (v) otherwise be in form and
content reasonably satisfactory to Landlord. If upon any transfer of the Letter
of Credit, any fees or charges shall be so imposed, then such fees or charges
shall be payable solely by Landlord. The Letter of Credit shall provide that it
shall be deemed automatically renewed, without amendment, for consecutive
periods of one year each thereafter during the Term (and in no event shall the
Letter of Credit expire prior to the sixtieth (60th) day following the scheduled
expiration date of the Term or any renewal Term); provided, however, the Issuing
Bank may retain the right to send duplicate notices (the "Non-Renewal Notices")
to Landlord and Tenant by certified mail, return receipt requested, not less
than sixty (60) days next preceding the then- expiration date of the Letter of
Credit, stating that the Issuing Bank has elected not to renew the Letter of
Credit.  The Issuing Bank shall agree with all drawers, endorsers and bona fide
holders that drafts drawn under and in compliance with the terms of the Letter
of Credit will be duly honored upon presentation to the Issuing Bank or its
correspondent bank at an office location in Dallas, Texas. The Letter of Credit
shall be subject in all respects to the International Standard Practice 1998
(ISP 98), International Chamber of Commerce Practice, Publication No. 590.

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(b)Drawings under Letter of Credit. If (i) a Default of Tenant occurs under this
Lease, or (ii) Tenant fails to make any installment of Rent as and when due and
which remains unpaid after delivery of a notice of delinquency, or (iii)
Landlord receives a Non-Renewal Notice, or (iv) Tenant files a voluntary
petition under any Federal or state bankruptcy or insolvency code, law or
proceeding, then Landlord shall have the right by sight draft to draw, at its
election, all or a portion of the proceeds of the Letter of Credit and
thereafter hold, use, apply, or retain the whole or any part of such proceeds,
as the case may be, (x) to the extent required for the payment of any Basic Rent
or any other sum as to which Tenant is in default including (1) any sum which
Landlord may expend or may be required to expend by reason of Tenant's default,
and/or (2) any damages to which Landlord is entitled pursuant to this Lease,
whether such damages accrue before or after summary proceedings or other reentry
by Landlord, and/or (y) as a cash security deposit, unless and until, in the
case of clause (iii) above, Tenant delivers to Landlord a substitute Letter of
Credit which meets the requirements of Section 26(a). If Landlord applies or
retains any part of the proceeds of the Letter of Credit, or cash security,
Tenant, upon demand, shall amend the Letter of Credit to increase the amount
thereof by the amount so applied or retained or provide Landlord with an
additional Letter of Credit in the amount so applied or retained so that
Landlord shall have the full amount thereof on hand at all times during the
Term. If Tenant shall comply with all of the terms, covenants and conditions of
this Lease, the Letter of Credit shall be returned to Tenant not more than sixty
(60) days after the expiration date of the Term and after delivery of possession
of the Premises to Landlord in the manner required by this Lease and the curing
of any outstanding Default of Tenant under this Lease.

 

(c)Use of Proceeds by Landlord. Tenant hereby acknowledges and agrees that
Landlord is entering into this Lease in material reliance upon the ability of
Landlord to draw upon the Letter of Credit upon the occurrence of any breach or
Default on the part of Tenant under this Lease. If Tenant shall breach any
provision of this Lease or otherwise be in Default hereunder, Landlord may, but
without obligation to do so, and without notice to Tenant, draw upon the Letter
of Credit, in part or in whole, to cure any breach or Default of Tenant and/or
to compensate Landlord for any and all damages of any kind or nature sustained
resulting from Tenant's breach or Default. The use, application or retention of
the Letter of Credit, or any portion thereof, by Landlord shall not prevent
Landlord from exercising any other right or remedy provided by this Lease or by
any applicable law, it being intended that Landlord shall not first be required
to proceed against the Letter of Credit, and shall not operate as a limitation
on any recovery to which Landlord may otherwise be entitled. Tenant agrees not
to interfere in any way with payment to Landlord of the proceeds of the Letter
of Credit, either prior to or following a "draw" by Landlord of any portion of
the Letter of Credit, regardless of whether any dispute exists between Tenant
and Landlord as to Landlord's right to draw upon the Letter of Credit. No
condition or term of this Lease shall be deemed to render the Letter of Credit
conditional to justify the issuer of the Letter of Credit in failing to honor a
drawing upon such Letter of Credit in a timely manner. Tenant agrees and
acknowledges that (i) the Letter of Credit constitutes a separate and
independent contract between Landlord and the Issuing Bank, (ii) Tenant is not a
third party beneficiary of such contract, (iii) Tenant has no property interest
whatsoever in the Letter of Credit or the proceeds thereof, and (iv) in the
event Tenant becomes a debtor under any chapter of the Bankruptcy Code, neither
Tenant, any trustee, nor Tenant's bankruptcy estate shall have any right to
restrict or limit Landlord's claim and/or rights to the Letter of Credit and/or
the proceeds thereof by application of Section 502(b)(6) of the U. S. Bankruptcy
Code or otherwise.

 

(d)Additional Covenants of Tenant. If, as a result of any drawing by Landlord on
the Letter of Credit, the amount of the Letter of Credit shall be less than the
Letter of Credit Amount, Tenant shall, within twenty (20) days thereafter,
provide Landlord with additional letter(s) of credit in an amount equal to the
deficiency, and any such additional letter(s) of credit shall comply with all of
the provisions of this Section 26. Tenant further agrees that it will neither
assign nor encumber the Letter of Credit or any part thereof and that neither
Landlord nor its successors or assigns will be bound by any such assignment,
encumbrance, attempted assignment or attempted encumbrance.

 

(e)Transfer of Letter of Credit. The Letter of Credit shall also provide that
Landlord, its successors and assigns, may, at any time and without notice to
Tenant and without first obtaining Tenant's consent thereto, transfer (one or
more times) all or any portion of its interest in and to the Letter of Credit to
the holder of any mortgage upon the Building or the successor landlord in
connection with a transfer of the Building, from or as a part of the assignment
by Landlord of its rights and interests in and to this Lease. In the event of a
transfer of Landlord's interest in the Building, Landlord shall transfer the
Letter of Credit, in whole or in part, to the transferee and thereupon Landlord
shall without any further agreement between the parties, be released by Tenant
from all liability therefor. The provisions of Section 26(c) shall apply to
every transfer or assignment of the whole or any portion of said Letter of
Credit to a new landlord. In connection with any such transfer of the Letter of
Credit by Landlord, Tenant shall, at Tenant's sole cost and expense, execute and
submit to the Issuing Bank such applications, documents and instruments as may
be necessary to effectuate such transfer, and Tenant shall be responsible for
paying the Bank's transfer and processing fees in connection therewith.

 

Page 27

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(f)Reduction in Letter of Credit Amount. Provided no Event of Default has
occurred hereunder, the Letter of Credit Amount shall be automatically reduced
in accordance with the following dates and amounts:

 

Lease Month

Required Letter of Credit Amount

Commencement Date – December 31, 2021

 

$1,500,000

January 1, 2022 – December 31,2022

$1,250,000

January 1, 2023 – December 31, 2023

$1,000,000

January 1, 2024 – December 31, 2024

$750,000

January 1, 2025 – December 31, 2025

$500,000

January 1, 2026 - end of Term

$250,000

 

(g)Nature of Letter of Credit. Landlord and Tenant (1) acknowledge and agree
that in no event or circumstance shall the Letter of Credit or any renewal
thereof or substitute therefor or any proceeds thereof (including the LC
Proceeds Account) be deemed to be or treated as a "security deposit" under any
Law applicable to security deposits in the commercial context, including
Sections 93.004-93.011 of the Texas Property Code, as enacted by H.B. 2803, 77th
Legislative Session, as such sections now exist or as may be hereafter amended
or succeeded ("Security Deposit Laws"), (2) acknowledge and agree that the
Letter of Credit (including any renewal thereof or substitute therefor or any
proceeds thereof) is not intended to serve as a security deposit, and the
Security Deposit Laws shall have no applicability or relevancy thereto, and (3)
waive any and all rights, duties and obligations either party may now or, in the
future, will have relating to or arising from the Security Deposit Laws.

 

27.Other Provisions.

 

(a)Monument Sign and Building Sign. Landlord will install, at Tenant's expense,
a sign panel (the "Monument Sign") displaying Tenant's name on Landlord's
monument sign situated on the grounds of the Project. Tenant shall also have the
right to place signage on the facade of the Building (the "Building Sign") in
the location shown on EXHIBIT D attached hereto. Further, Landlord approves the
signage renderings for the Building Sign as shown on EXHIBIT D attached hereto.
The cost of the Building Sign and installation thereof shall be Tenant's sole
cost. After the earlier of the end of the Term or after Tenant's right to
possess the Premises has  been terminated, Tenant shall remove the Monument Sign
and the Building Sign, repair all damage caused thereby, and restore the Project
grounds or Building area on which the Monument Sign or Building Sign was located
to their condition before the installation of the Monument Sign and Building
Sign within ten (10) days after Landlord's request therefor. If Tenant fails to
timely do so, Landlord may, without compensation to Tenant and at Tenant's
expense, remove the Monument Sign and/or the Building Sign, perform the related
restoration and repair work and dispose of the Monument Sign and/or Building
Sign in any manner Landlord deems appropriate. The rights granted to Tenant
under this Section 27(b) are personal to Tenant, may not be assigned to any
party, and may be revoked by Landlord if Tenant ceases to occupy at least 80% of
the initial Premises first leased. Notwithstanding Landlord's indemnification
contained in Section 27(b) of the Lease, it is the intention of the parties that
Tenant bear all risks relating to the installation, use, maintenance, operation
and removal of the Monument Sign and Building Sign; therefore, Tenant shall
defend, indemnify and hold harmless Landlord, its agents and their respective
affiliates from all losses, claims, costs and liabilities arising in connection
with or relating to the installation, maintenance, use, operation and removal of
the Monument Sign and Building Sign, INCLUDING, WITHOUT LIMITATION, THAT ARISING
FROM LANDLORD'S NEGLIGENCE (OTHER THAN ITS GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT).

 

(b)Lab Area Cleaning Services. Notwithstanding any provision herein to the
contrary, Tenant shall be responsible, at its sole cost and expense, for
cleaning, janitorial and trash removal services and other medical waste and
biohazard disposal services for the Lab Area, which Lab Area shall be
specifically designated by Tenant as a laboratory in a manner reasonably
satisfactory to Landlord to enable Landlord and Landlord's contractors to
perform the services required hereunder to the office portions of the Premises
only. Such services shall be performed by licensed (where required by law or
governmental regulation), insured and qualified contractors approved in advance,
in writing, by Landlord (which approval shall not be unreasonably withheld,
delayed or conditioned) and on a sufficient basis to ensure that the Premises
are at all times kept neat and clean.

 

[Signature Page Follows.]

 

 

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LANDLORD AND TENANT EXPRESSLY DISCLAIM ANY IMPLIED WARRANTY THAT THE PREMISES
ARE SUITABLE FOR TENANT'S INTENDED COMMERCIAL PURPOSE, AND  TENANT'S  OBLIGATION
TO PAY RENT HEREUNDER IS NOT DEPENDENT UPON THE CONDITION OF THE PREMISES OR THE
PERFORMANCE BY LANDLORD OF ITS OBLIGATIONS HEREUNDER, AND, EXCEPT AS OTHERWISE
EXPRESSLY PROVIDED HEREIN, TENANT SHALL CONTINUE TO PAY THE RENT, WITHOUT
ABATEMENT, DEMAND, SETOFF OR DEDUCTION, NOTWITHSTANDING ANY BREACH  BY LANDLORD
OF ITS DUTIES OR OBLIGATIONS HEREUNDER, WHETHER EXPRESS OR IMPLIED.

 

IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease to be
effective as of the Lease Date.

 

 

LANDLORD:

 

LAS CIMAS OWNER LP,

 

 

 

a Delaware limited partnership

 

 

 

 

 

 

 

 

By:

LAS CIMAS OWNER GP LLC,

 

 

 

 

a Delaware limited liability company, its general partner

 

 

 

 

 

 

 

 

By:

/s/ Ron J. Hoyl

 

 

 

Name:

Ron J. Hoyl

 

 

 

Title:

Vice President

 

 

 

 

 

 

TENANT:

 

AEGLEA BIOTHERAPEUTICS, INC.,

 

 

 

a Delaware corporation

 

 

 

 

 

 

 

 

By:

/s/ Anthony G. Quinn

 

 

 

Name:

Anthony G. Quinn

 

 

 

Title:

President, Chief Executive Officer and Director

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page

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OUTLINE OF PREMISES

 

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EXHIBIT A, Outline of Premises - Page 1

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EXHIBIT B

DESCRIPTION OF THE LAND

 

TRACT 1: Lot 1A, Block A, of Amended Plat of Block A, of Las Cimas Office Park,
a subdivision in Travis County, Texas, according to the map or plat of record in
Volume 102, Pages 167-169, of the Plat Records of Travis County, Texas.

 

TRACT 2: Easements appurtenant to Tract 1 across portions of Lot 2, Block B, Las
Cimas Office Park, a subdivision in Travis County, Texas, according to the map
or plat thereof recorded in Volume 86, Pages 189A-189B, of the Plat Records of
Travis County, Texas, and Lot 5A, Block A, of Amended Plat of Block A, of Las
Cimas Office Park, a subdivision in Travis County, Texas, according to the map
or plat thereof recorded in Volume 102, Pages 167-169, of the Plat Records of
Travis County, Texas, as created and described in that certain i) Declaration of
Covenants, Conditions and Restrictions for Las Cimas Office Park recorded in
Volume 9819, Page 1, of the Real Property Records of Travis County, Texas, as
amended in Volume 13112, Page 2863, of the Real Property Records of Travis
County, Texas, and ii) that certain Declaration of Easements and Restrictions
recorded in Volume 12356, Page 1, of the Real Property Records of Travis County,
Texas, as affected by Volume 13176, Page 15, of the Real Property Records of
Travis County, Texas.

 

TRACT 3: Lot 3A, Block A, of Amended Plat of Block A, of Las Cimas Office Park,
a subdivision in Travis County, Texas, according to the map or plat of record in
Volume 102, Pages 167-169, of the Plat Records of Travis County, Texas.

 

TRACT 4: Easements appurtenant to Tract 3 across portions of Lot 2, Block B, Las
Cimas Office Park, a subdivision in Travis County, Texas, according to the map
or plat thereof recorded in Volume 86, Pages 189A-189B, of the Plat Records of
Travis County, Texas, and Lot 5A. Block A, of Amended Plat of Block A, of Las
Cimas Office Park, a subdivision in Travis County, Texas, according to the map
or plat thereof recorded in Volume 102, Pages 167-169, of the Plat Records of
Travis County, Texas, as created and described in that certain Declaration of
Covenants, Conditions and Restrictions for Las Cimas Office Park recorded in
Volume 9819, Page 1, of the Real Property Records of Travis County, Texas, as
amended in Volume 13112, Page 2863, of the Real Property Records of Travis
County, Texas.

 

 

 

EXHIBIT B, Description of the Land - Page 1

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EXHIBIT C

TENANT FINISH WORK

 

1.Acceptance of Premises. Except as set forth in this Exhibit or otherwise in
the Lease, Tenant accepts the Premises in its "AS-IS" condition on the date that
this Lease is entered into.

 

2.Working Drawings.

 

(a)Preparation and Delivery. At least fifteen (15) business days prior to
commencing construction on the Premises, (the "Working Drawings Delivery
Deadline"), Tenant shall provide to Landlord for its approval final working
drawings, prepared by Urban Foundry Architecture, LLC (the "Architect"), of all
improvements that Tenant proposes to install in the Premises; such working
drawings shall include the partition layout, ceiling plan, electrical outlets
and switches, telephone outlets, drawings for any modifications to the
mechanical and plumbing systems of the Building, and detailed plans and
specifications for the construction of the improvements called for under this
Exhibit in accordance with all applicable Laws.

 

(b)Approval Process. Landlord shall notify Tenant whether it approves of the
submitted working drawings within ten business days after Tenant's submission
thereof. If Landlord disapproves of such working drawings, then Landlord shall
notify Tenant thereof specifying in reasonable detail the reasons for such
disapproval, in which case Tenant shall, within five business days after such
notice, revise such working drawings in accordance with Landlord's objections
and submit the revised working drawings to Landlord for its review and approval.
Landlord shall notify Tenant in writing whether it approves of the resubmitted
working drawings within five business days after its receipt thereof. This
process shall be repeated until the working drawings have been finally approved
by Tenant and Landlord. If Landlord fails to notify Tenant that it disapproves
of the initial working drawings within ten business days (or, in the case of
resubmitted working drawings, within five business days) after the submission
thereof, then Landlord shall be deemed to have approved the working drawings in
question.

 

(c)Landlord's Approval; Performance of Work. If any of Tenant's proposed
construction work will affect the Building's Structure or the Building's
Systems, then the working drawings pertaining thereto must be approved by the
Building's engineer of record, Building Diagnostics (BDI) for the Building’s
Structure and B2AEP, LLC for the Building’s System. Landlord's approval of such
working drawings shall not be unreasonably withheld, provided that (1) they
comply with all Laws, (2) the improvements depicted thereon do not adversely
affect (in the reasonable discretion of Landlord) the Building's Structure or
the Building's Systems (including the Building's restrooms or mechanical rooms),
the exterior appearance of the Building, or the appearance of the Building's
common areas or elevator lobby area, or the reputation and marketability of the
Building, (3) such working drawings are sufficiently detailed to allow
construction of the improvements in a good and workmanlike manner, and (4) the
improvements depicted thereon conform to the rules and regulations promulgated
from time to time by Landlord for the construction of tenant improvements (a
copy of which has been delivered to Tenant). As used herein, "Working Drawings"
means the final working drawings approved by Landlord, as amended from time to
time by any approved changes thereto, and "Work" means all improvements to be
constructed in accordance with and as indicated on the Working Drawings,
together with any work required by governmental authorities to be made to other
areas of the Building as a result of the improvements indicated by the Working
Drawings. Landlord's approval of the Working Drawings shall not be a
representation or warranty of Landlord that such drawings are adequate for any
use or comply with any Law, but shall merely be the consent of Landlord thereto.
After the Working Drawings have been approved, Tenant shall cause the Work to be
performed in accordance with the Working Drawings.

 

3.Contractors; Performance of Work. The Work shall be performed only by licensed
(if applicable) contractors and subcontractors approved in writing by Landlord,
which approval shall not be unreasonably withheld. A list of approved
contractors is included in the rules and regulations. All contractors and
subcontractors shall be required to procure and maintain insurance against such
risks, in such amounts, and with such companies as Landlord may reasonably
require. Certificates of such insurance, with paid receipts therefor, must be
received by Landlord before the Work is commenced. The Work shall be performed
in a good and workmanlike manner free of defects, shall conform with the Working
Drawings, and shall be performed in such a manner and at such times as and not
to interfere with or delay Landlord's other contractors, the operation of the
Project, and the occupancy thereof by other tenants. All contractors and
subcontractors shall contact Landlord and schedule time periods during which
they may use Project facilities in connection with the Work (e.g., elevators,
excess electricity, etc.); provided, however, that Landlord shall not charge
Tenant or its contractors for the use of elevators, electricity, or other
building services during construction.

EXHIBIT C, Tenant Finish-Work: Allowance - Page 32

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4.Construction Contracts.

 

(a)Tenant's General Contractor. Tenant shall enter into a construction contract
with a general contractor selected by Tenant in a form acceptable to Tenant's
representative for the Work, which shall comply with the provisions of this
Section 4 and provide for, among other things, (1) a one-year warranty for all
defective Work; (2) a requirement that Tenant's contractor and subcontractor
maintains insurance (unless, as it relates to subcontractor’s insurance
obligation, Tenant’s contractor is obligated under the construction contract to
maintain subguard insurance, in which event this insurance requirement shall
only apply Tenant’s contractor) against such risks, in amounts provided in
Section 4(c) below with companies in compliance with the guidelines set forth in
Section 11(b)(7) of the Lease, each policy covering the general contractor and
each architect, each engineer, and further, naming Landlord, Landlord's property
management company, Landlord's asset management company, Landlord's Mortgagee,
and Tenant as additional insureds; (3) a requirement that the contractor perform
the Work in substantial accordance with the Working Drawings and in a good and
workmanlike manner; (4) a requirement that the contractor is responsible for
daily cleanup work and final clean up (including removal of debris); and (5)
those items described in Section 4.(b) (collectively, the "Approved Criteria").
Promptly following Landlord’s written request, Tenant shall provide Landlord
with a copy of the construction contract entered into for the Work.

 

(b)All Construction Contracts. Unless otherwise agreed in writing by Landlord
and Tenant, each of Tenant's construction contracts shall: (1) provide a
schedule and sequence of construction activities and completion reasonably
acceptable to Landlord, (2) be in a contract form that satisfies the Approval
Criteria, (3) require the contractor and each subcontractor to name Landlord,
Landlord's property management company, Landlord's asset management company, and
Tenant as additional insured on such contractor's insurance maintained in
connection with the construction of the Work, (4) be assignable following an
Event of Default by Tenant under this Lease to Landlord and Landlord's
Mortgagees, and (5) contain at least a one-year warranty for all workmanship and
materials.

 

(c)(1) Commercial General Liability Insurance with limits of not less than Two
Million Dollars ($2,000,000) per occurrence for bodily injury and property
damage, Two Million U.S. Dollars ($2,000,000) any one person or organization for
personal injury, Two Million Dollars ($2,000,000) general aggregate, and Two
Million Dollars ($2,000,000) products completed operations aggregate covering:
(i) property/operations liability; (ii) products/completed operations liability;
(iii) personal injury liability; (iv) independent contractors liability; and (v)
broad form contractual liability, endorsed to add as an additional insured
whichever entities Landlord may require in its reasonable discretion, which as
of the Lease Date are: Rockpoint Group, L.L.C., Rockhill Management, L.L.C.,
Rockpoint Real Estate Fund V, L.P., Rockpoint Real Estate Fund V Offshore AIV,
L.P., Las Cimas Owner GP LLC, Las Cimas Member LP, and Las Cimas Owner LP.

 

(2)Automobile Liability Insurance covering the ownership, maintenance, and
operations of any automobile or automotive equipment, whether such auto is
owned, hired or non-owned, with a combined single  limit for bodily injury and
property damage of One Million Dollars ($1,000,000) each accident, insuring
against any and all claims for bodily injury, including death resulting there
from, and damage to the property of others caused by accident and arising from
Contactor or by any one directly or indirectly employed by Contactor.

 

(3)Workers Compensation Insurance covering statutory workers compensation
benefits and employers liability coverage with limits as statutorily required
for each accident for bodily injury by accident and for each employee and policy
limit for bodily injury by disease.

 

(4)Umbrella Liability Insurance providing excess liability coverage with respect
to the commercial general liability, automobile liability and employers
liability policies described above with limits of at least Ten Million Dollars
($10,000,000) per occurrence and Ten Million Dollars ($10,000,000) general
aggregate and products/completed operations aggregate, written with a form that
provides coverage that is at least as broad as the primary insurance policies.

 

(5)Coverage for toxic or Hazardous Materials or covering cleanup costs and
third-party claims  arising from spills, releases, or alleged exposure to
Hazardous Materials used, stored, handled, treated, generated, released, or
disposed of at or from the Premises by Contractor, the minimum limit required is
$2,000,000 per occurrence and in the aggregate, including coverage for bodily
injury and property damage resulting from environmental and pollution liability
caused or exacerbated by Contractor.

 

5.Intentionally Deleted.

 

EXHIBIT C, Tenant Finish-Work: Allowance - Page 33

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6.Definitions. As used herein "Substantial Completion," "Substantially
Completed," and any derivations thereof mean the Work in the Premises is
substantially completed in accordance with the Working Drawings as evidenced by
receipt of Temporary Certificate of Occupancy or Full Certificate of Occupancy
issued  by the applicable governing authority and the issuance of a certificate
of substantial completion by the Tenant’s Architect and Engineer of record.
Substantial Completion shall have occurred even though minor details of
construction, decoration, landscaping and mechanical adjustments remain to be
completed.

 

7.Walk-Through; Punchlist. When Tenant considers the Work in the Premises to be
Substantially Completed, Tenant will notify Landlord and within three business
days thereafter, Landlord's representative and Tenant's representative shall
conduct a walk-through of the Premises and identify any necessary touch-up work,
repairs and minor completion items that are necessary for final completion of
the Work. Neither Landlord's representative nor Tenant's representative shall
unreasonably withhold his or her agreement on punchlist items. Tenant shall use
reasonable efforts to cause the contractor performing the Work to complete all
punchlist items within 30 days after agreement thereon.

 

8.Excess Costs. The entire cost of performing the Work (including design of and
space planning for the Work and preparation of the Working Drawings and the
final record drawings of the Work, costs of construction labor and materials,
general tenant signage, related taxes and insurance costs, licenses, permits,
certifications, surveys and other approvals required by Law, and the
construction supervision fee referenced in Section 10 of this Exhibit, all of
which costs are herein collectively called the "Total Construction Costs") in
excess of the Construction Allowance (hereinafter defined) shall be paid by
Tenant. Upon approval of the Working Drawings and selection of a contractor,
Tenant shall provide to Landlord the project budget, including the general
contractor’s schedule of values, which identifies such drawings and itemizes the
Total Construction Costs and sets forth the Construction Allowance.

 

9.Construction Allowance. Landlord shall provide to Tenant a construction
allowance not to exceed (i) $592,050 for Suite 100 & 110 of the Premises (the
"Suite 100 & 110 Allowance") and (ii) $411,640.00  for Suite 150 of the Premises
(the "Suite 150 Allowance") (the sum of [i] and [ii] collectively, the
"Construction Allowance") to be applied toward the applicable Total Construction
Costs for the portion of the Premises to which they relate, as adjusted for any
changes to the Work. No advance of the Suite 100 & 110 Allowance shall be made
by Landlord until Tenant has first paid to the contractor from its own funds
(and provided reasonable evidence thereof to Landlord) the anticipated amount by
which the projected Total Construction Costs for the Suite 100 &  110 Work
exceeds the amount of the Suite 100 & 110 Allowance, and no advance of the Suite
150 Allowance shall be made by Landlord until Tenant has first paid to the
contractor from its own funds (and provided reasonable evidence thereof to
Landlord) the anticipated amount by which the projected Total Construction Costs
for the Suite 150 Work exceeds the amount of the Suite 150 Allowance. Landlord
shall pay to Tenant the Suite 100 & 110 Allowance and the Suite 150 Allowance in
multiple disbursements (but not more than once per calendar month) following the
receipt by Landlord of the following items: (a) a request for payment, (b) final
or partial lien waivers for work exceeding $10,000 per subcontractor or vendor,
as the case may be, from all persons performing work or supplying or fabricating
materials for the Work, fully executed, acknowledged and in recordable form, and
(c) the Architect's certification that the Work for which reimbursement has been
requested has been completed, including (with respect to the last application
for payment only) any punch-list items, on the appropriate AIA form or another
form approved by Landlord, and, with respect to the disbursement of the last 10%
of the Suite 100 & 110 Allowance or Suite 150 Allowance, as applicable: (1) the
permanent certificate of occupancy issued for the Suite 100 & 110 Premises or
the Suite 150 Premises, as applicable, (2) Tenant's occupancy of the Suite 100 &
110 Premises, or the Suite 150 Allowance, as applicable, (3) delivery of the
architectural record drawings (or, with respect to the last application for
payment only, the “as built” plans) for the Suite 100 & 110 Work or Suite 150
Work, as applicable as constructed (and as set forth above) to Landlord's
construction representative (set forth below), and (4) an estoppel certificate
confirming such factual matters as Landlord or Landlord's Mortgagee may
reasonably request (collectively, each, a "Completed Application for Payment").
Landlord shall pay the amount requested in the applicable Completed Application
for Payment to Tenant within 30 days following Tenant's submission of the
Completed Application for Payment. If, however, the Completed Application for
Payment is incomplete or incorrect, Landlord's payment of such request shall be
deferred until 30 days following Landlord's receipt of the Completed Application
for Payment. Notwithstanding anything to the contrary contained in this Exhibit,
Landlord shall not be obligated to make any disbursement of the Construction
Allowance during the pendency of any of the following: (A) Landlord has received
written notice of any unpaid claims relating to any portion of the Work or
materials in connection therewith, other than claims which will be paid in full
from such disbursement, (B) there is an unbonded lien outstanding against the
Building or the Premises or Tenant's interest therein by reason of work done, or
claimed to have been done, or materials supplied or specifically fabricated,
claimed to have been supplied or specifically fabricated, to or for Tenant or
the Premises, (C) the conditions to the advance of the Construction Allowance
are not satisfied, (D) Tenant continues to be in breach of the Building Rules &
Regulations following five (5) business days' notice by Landlord, or (E) an
Event of

EXHIBIT C, Tenant Finish-Work: Allowance - Page 34

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Default by Tenant exists. The Construction Allowance must be used (that is, the
Work must be fully complete and the Construction Allowance disbursed) within
nine (9) months following the Commencement Date or shall be deemed forfeited
with no further obligation by Landlord with respect thereto, time being of the
essence with respect thereto.

 

10.Architect Fees. In addition to the Construction Allowance, Landlord shall pay
Tenant's architect an amount up to $3,903.38, for the initial test fit and one
revision to the test fit. Landlord shall pay to Tenant's architect such fee
within thirty (30) days following Tenant's written demand and delivery of an
invoice from Tenant's architect.

 

11.Construction Management. Landlord or its Affiliate or agent shall supervise
the Work and coordinate the relationship between the Work, the Building and the
Building's Systems. In consideration for Landlord's construction supervision
services, Tenant shall pay to Landlord or its Affiliate or agent a construction
supervision fee equal to one percent (1%) of the Construction Allowance.
Tenant's contractor shall hold weekly project meetings with Landlord's
construction management representative, Tenant's architect, and all other
relevant parties to discuss coordination efforts, procedures, progress,
problems, scheduling and open issues. All on-site logistics and improvements
affecting the Building's Systems will be coordinated and approved by Landlord's
construction management representative. Landlord and its construction management
team will have the right to enter the Premises at all reasonable hours, upon
reasonable prior notice, to review and provide oversight of the construction
process.

 

12.Construction Representatives. Landlord's and Tenant's representatives for
coordination of construction and approval of change orders will be as follows,
provided that either party may change its representative upon written notice to
the other:

 

Landlord's Representative:

Andrew Lodeesen

Regional Project Manager

Peloton Commercial Real Estate

8310-1 N. Capital of Texas Highway, Suite 225

Telephone: 512-814-3414

 

Tenant's Representative:

Eugene Sackett

901 Mopac Expressway South

Bldg 1 Suite 250

Austin, TX 78746

Telephone: 512-394-4186

 

13.Miscellaneous. To the extent not inconsistent with this Exhibit, Sections
8(a) and 21 of this Lease shall govern the performance of the Work and
Landlord's and Tenant's respective rights and obligations regarding the
improvements installed pursuant thereto.

 

 

EXHIBIT C, Tenant Finish-Work: Allowance - Page 35

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EXHIBIT D

 

BUILDING SIGN

 

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EXHIBIT D, Building Sign - Page 1

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EXHIBIT D, Building Sign - Page 2

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EXHIBIT E

 

PARKING

 

Tenant may use up to one hundred twenty (120) covered parking spaces, of which
up to nine (9) shall be reserved parking spaces, and the remaining shall be
unreserved parking spaces, in the parking facilities associated with the
Building (the "Parking Area") subject to such terms, conditions and regulations
as are from time to time applicable to patrons of the Parking Area. The use of
the unreserved parking spaces shall be at no additional charge during the
initial Term for the unreserved spaces. The use of the reserved parking spaces
shall be at a charge equal  to $50.00 per reserved space per month, payable
contemporaneously with the payment of Basic Rent.

 

Tenant shall at all times comply with all Laws respecting the use of the Parking
Area. Landlord reserves  the right to adopt, modify, and enforce reasonable
rules and regulations governing the use of the Parking Area from time to time
including any key-card, sticker, or other identification or entrance systems and
hours of operations. Landlord may refuse to permit any person who violates such
rules and regulations to park in the Parking Area, and any violation of the
rules and regulations shall subject the car to removal from the Parking Area.

 

Tenant may validate visitor parking by such method or methods as Landlord may
approve, at the validation rate from time to time generally applicable to
visitor parking. Unless specified to the contrary above, the parking spaces
provided hereunder shall be provided on an unreserved, "first-come, first
served" basis. The reserved spaces shall be in location mutually agreeable to
Tenant and Landlord, subject to availability and rights of other tenants of the
Building. Tenant acknowledges that Landlord has arranged or may arrange for the
Parking Area to be operated by an independent contractor, not affiliated with
Landlord.

 

There will be a replacement charge payable by Tenant equal to the amount posted
from time to time by Landlord for loss of any magnetic parking card or parking
sticker issued by Landlord.

 

All motor vehicles (including all contents thereof) shall be parked in the
Parking Area at the sole risk of Tenant and each other Tenant Party, it being
expressly agreed and understood Landlord has no duty to insure any of said motor
vehicles (including the contents thereof), and Landlord is not responsible for
the protection and security of such vehicles. NOTWITHSTANDING ANYTHING TO THE
CONTRARY CONTAINED IN THIS LEASE, LANDLORD SHALL HAVE NO LIABILITY WHATSOEVER
FOR ANY PROPERTY DAMAGE WHICH MIGHT OCCUR ON THE PARKING AREA OR AS A RESULT OF
OR IN CONNECTION WITH THE PARKING OF MOTOR VEHICLES IN ANY OF THE PARKING
SPACES.

 

If, for any reason, Landlord is unable to provide all or any portion of the
parking spaces to which Tenant is entitled hereunder, then Tenant's obligation
to pay for such parking spaces shall be abated for so long as Tenant does not
have the use thereof; this abatement shall be in full settlement of all claims
that Tenant might otherwise have against Landlord because of Landlord's failure
or inability to provide Tenant with such parking spaces. Landlord shall not be
responsible for enforcing Tenant's parking rights against any third parties.

 

EXHIBIT E, Parking - Page 1

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EXHIBIT F

 

RENEWAL OPTION

 

Provided no Event of Default exists and Tenant is occupying not less than 80% of
the entire Premises initially leased at the time of such election, Tenant may
renew this Lease for one additional period of five (5) years by delivering
written notice of the exercise thereof to Landlord not earlier than 18 months
nor later than 12 months before the expiration of the Term. The Basic Rent
payable for each month during such extended Term shall be the greater of (i) the
then-current Basic Rent, or (ii) the prevailing rental rate at the commencement
of such extended Term, for leases of space in the Building of equivalent
quality, size, utility and location, with the length of the extended Term to be
taken into account ("Market Rate") (the greater of [i] and [ii] is the "Renewal
Rental Rate"). Within 30 days after receipt of Tenant's notice to renew,
Landlord shall deliver to Tenant written notice of the Renewal Rental Rate and
shall advise Tenant of the required adjustment to Basic Rent, if any, and the
other terms and conditions offered. Tenant shall, within ten days after receipt
of Landlord's notice, notify Landlord in writing whether Tenant accepts or
rejects Landlord's determination of the Renewal Rental Rate. If Tenant timely
notifies Landlord that Tenant accepts Landlord's determination of the Renewal
Rental Rate, then, on or before the commencement date of the extended Term,
Landlord and Tenant shall execute an amendment to this Lease extending the Term
on the same terms provided in this Lease, except as follows:

 

(a)Basic Rent shall be adjusted to the Renewal Rental Rate;

 

(b)Tenant shall have no further renewal option unless expressly granted by
Landlord in

writing;

 

(c)Landlord shall lease to Tenant the Premises in their then-current condition,
and Landlord shall not provide to Tenant any allowances (e.g., moving allowance,
construction allowance, and the like) or other tenant inducements; and

 

(d)Tenant shall pay for the parking spaces which it is entitled to use at the
rates from time to time charged to patrons of the Parking Area and/or any other
parking area associated with the Building during the extended Term (plus all
applicable taxes).

 

If Tenant rejects the Market Rate as calculated by Landlord, Tenant shall inform
Landlord of its rejection within ten (10) business days after Tenant's receipt
of Landlord's calculation, and Landlord and Tenant shall commence negotiations
to agree upon the Market Rate. If, despite using good faith efforts, Landlord
and Tenant are unable to reach agreement as to the Market Rate within thirty
(30) days after the date that Tenant rejected Landlord's initial determination
(the "Negotiation Period"), then Tenant may invoke, by the delivery of written
notice thereof to Landlord, the following binding arbitration procedures set
forth below within ten (10) business days after the expiration of the
Negotiation Period; if Tenant fails to so invoke the arbitration provisions set
forth below, Tenant's notice of exercise shall be deemed to have been revoked,
and Tenant's option to extend (and any other options remaining thereafter) shall
be rendered null and void and of no further force or effect.

 

(i)If Tenant elects to invoke arbitration as provided above, then within ten
(10) business days thereafter, Landlord and Tenant shall each simultaneously
submit to the other in a sealed envelope its good faith estimate of the Market
Rate. If the higher of such estimates is not more than one hundred five percent
(105%) of the lower, then the Market Rate shall be the average of the two.
Otherwise, within seven (7) days after the exchange of estimates, the parties
shall select as an arbitrator an independent MAI appraiser with at least ten
(10) years of experience in appraising office space in the metropolitan area in
which the Project is located (a "Qualified Appraiser"). If the parties cannot
agree on a Qualified Appraiser, then within a second period of seven (7) days,
each shall select a Qualified Appraiser and within ten (10) days thereafter the
two appointed Qualified Appraisers shall select a third Qualified Appraiser and
the third Qualified Appraiser shall be the sole arbitrator. If one party shall
fail to select a Qualified Appraiser within the second seven (7) day period,
then the Qualified Appraiser chosen by the other party shall be the sole
arbitrator.

 

(ii)Within twenty-one (21) days after submission of the matter to the
arbitrator, the arbitrator shall determine the Market Rate by choosing whichever
of the estimates submitted by Landlord and Tenant the arbitrator judges to be
more accurate. The arbitrator shall notify Landlord and Tenant of its decision,
which shall be final and binding on the parties. If the arbitrator believes that
expert advice would materially assist him, the arbitrator may retain one or more
qualified persons to provide expert advice. The fees of the arbitrator and the
expenses of the arbitration proceeding, including the fees of any

EXHIBIT F, Renewal Option – Page  1

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expert witnesses retained by the arbitrator, shall be paid by the  party whose
estimate is not selected. Each party shall pay the fees of its respective
counsel and the fees of any witness called by that party.

 

Tenant's rights under this Exhibit shall terminate if (1) this Lease or Tenant's
right to possession of the Premises is terminated, (2) Tenant assigns any of its
interest in this Lease or sublets any portion of the Premises other than to a
Permitted Transferee, or (3) Tenant fails to timely exercise its option under
this Exhibit, time being of the essence with respect to Tenant's exercise
thereof.

 

EXHIBIT F, Renewal Option – Page  2

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EXHIBIT G

 

RIGHT OF FIRST REFUSAL

 

1.Subject to then-existing renewal or expansion options of other tenants of the
Building and provided no Event of Default then exists, if Landlord receives a
bona fide offer from a third party (the "Third Party Offer") to lease the space
designated on Exhibit G-1 (the "Refusal Space") and Landlord is willing to
accept the terms of such Third Party Offer, Landlord shall offer to lease to
Tenant the Refusal Space on the same terms and conditions as the Third Party
Offer; such offer shall be in writing, specify the rent to be paid for the
Refusal Space, contain the basic terms and conditions of the Third Party Offer
and the date on which the Refusal Space shall be included in the Premises (the
"Offer Notice").

 

2.The Offer Notice shall be substantially similar to the Offer Notice attached
as Exhibit G-2. Tenant shall notify Landlord in writing whether Tenant elects to
lease the entire portion of the Refusal Space subject to the Third Party Offer
on the same terms and conditions as the Third Party Offer in the Offer Notice,
within ten (10) days after Landlord delivers to Tenant the Offer Notice. Tenant
may only elect to lease the Refusal Space if it intends to use the Refusal Space
for general office use. If Tenant timely elects to lease the Refusal Space
within such ten (10) day period, then Landlord and Tenant shall execute an
amendment to this Lease, effective as of the date the Refusal Space is to be
included in the Premises, on the same terms as this Lease except:

 

(a)the Basic Rent shall be the amount specified in the Offer Notice;

 

(b)the term for the Refusal Space shall be that specified in the Offer Notice;

 

(c)Tenant shall lease the Refusal Space in an "AS-IS" condition, Landlord shall
not be required to perform any work therein, and Landlord shall not provide to
Tenant any allowances other than those contained in the Third Party Offer (e.g.,
moving allowance, construction allowance, and the like) if any; and

 

(d)other terms set forth in this Lease which are inconsistent with the terms of
the Offer Notice shall be modified accordingly.

 

3.Notwithstanding the foregoing, if the Offer Notice includes space in excess of
the Refusal Space, and such excess space is equal to or greater than half of the
square footage of the original Premises, Tenant must exercise its right
hereunder, if at all, as to all of the space contained in the Offer Notice. If
Tenant fails or is unable to timely exercise its right hereunder, then such
right shall lapse (it being understood that Tenant's right under this Exhibit is
a one-time right only), time being of the essence with respect to the exercise
thereof, and Landlord may lease all or a portion of the Refusal Space to third
parties on such terms as contained in the Offer Notice, as may reasonably change
in negotiations thereafter with the relevant third-party. Tenant may not
exercise its rights under this Exhibit if an Event of Default exists or Tenant
is not then occupying the entire Premises.  For purposes hereof,  if an Offer
Notice is delivered for less than all of the Refusal Space but such notice
provides for an expansion, right of first refusal, or other preferential right
to lease some of the remaining portion of the Refusal Space, then such remaining
portion of the Refusal Space shall thereafter be excluded from the provisions of
this Exhibit. In no event shall Landlord be obligated to pay a commission with
respect to any space leased by Tenant under this Exhibit, and Tenant and
Landlord shall each indemnify the other against all costs, expenses, attorneys'
fees, and other liability for commissions or other compensation claimed by any
broker or agent claiming the same by, through, or under the indemnifying party.

 

4.Tenant's rights under this Exhibit shall terminate if (a) this Lease or
Tenant's right to possession of the Premises is terminated, (b) Tenant assigns
any of its interest in this Lease or Tenant is occupying less than 70% of the
entire Premises, (c) Tenant fails timely to exercise its option as to any
portion of the Refusal Space, or (d) the remaining initial Term of this Lease is
less than the proposed term of the Third Party Offer.

 

5.Notwithstanding the requirements of this Exhibit G, Landlord shall use good
faith efforts to give notice to Tenant when space in the Building becomes
available for lease, but Landlord’s failure to satisfy the requirements in this
Section 5 shall not constitute a default under the Lease nor shall Tenant have
any recourse for any such failure.

 

EXHIBIT G, Right of First Refusal - Page 1

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EXHIBIT G-1 REFUSAL SPACE

 

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EXHIBIT G-1, - Page 1

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EXHIBIT G-2

 

FORM OF OFFER NOTICE

 

[Insert Date of Notice]

 

 

 

 

 

BY TELECOPY AND FEDERAL EXPRESS

 

 

[TENANT'S ADDRESS]

 

 

 

 

 

 

 

 

 

 

 

Re:

Lease Agreement (the "Lease") dated                , 20    ,
between                                    ("Landlord"), and                 , a
                                          ("Tenant"). Capitalized terms used
herein but not defined shall be given the meanings assigned to them in the
Lease.

 

Ladies and Gentlemen:

 

Pursuant to the Right of First Refusal attached to the Lease, enclosed please
find an Offer Notice on Suite                . The basic terms and conditions
are as follows:

 

LOCATION:

 

 

 

 

 

 

 

SIZE:

 

                             rentable square feet

 

 

 

 

 

BASIC RENT RATE:

 

$              per month

 

 

 

 

 

TERM:

 

 

 

 

 

 

 

IMPROVEMENTS:

 

 

 

 

 

 

 

COMMENCEMENT:

 

 

 

 

 

 

 

PARKING TERMS:

 

 

 

 

 

 

 

OTHER MATERIAL TERMS:

 

 

 

 

Under the terms of the Right of First Refusal, you must exercise your rights, if
at all, as to the Refusal Space on the depiction attached to this Offer Notice
within               days after Landlord delivers such Offer Notice.
Accordingly, you have until 5:00 p.m. local time on
                                   , 20        , to exercise your rights under
the Right of First Refusal and accept the terms as contained herein, failing
which your rights under the Right of First Refusal shall terminate and Landlord
shall be free to lease the Refusal Space to any third party. If possible, any
earlier response would be appreciated. Please note that your acceptance of this
Offer Notice shall be irrevocable and may not be rescinded.

 

Upon receipt of your acceptance herein, Landlord and Tenant shall execute an
amendment to the Lease memorializing the terms of this Offer Notice including
the inclusion of the Refusal Space in the Premises; provided, however, that the
failure by Landlord and Tenant to execute such amendment shall not affect the
inclusion of such Refusal Space in the Premises in accordance with this Offer
Notice.

 

EXHIBIT G-2, - Page 1

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THE FAILURE TO ACCEPT THIS OFFER NOTICE BY (1) DESIGNATING THE "ACCEPTED" BOX,
AND (2) EXECUTING AND RETURNING THIS OFFER NOTICE TO LANDLORD WITHOUT
MODIFICATION WITHIN SUCH TIME PERIOD SHALL BE DEEMED A WAIVER OF TENANT'S RIGHTS
UNDER THE RIGHT OF FIRST REFUSAL, AND TENANT SHALL HAVE NO FURTHER RIGHTS TO THE
REFUSAL SPACE. THE FAILURE TO EXECUTE THIS LETTER WITHIN SUCH TIME PERIOD SHALL
BE DEEMED A WAIVER OF THIS OFFER NOTICE.

 

Should you have any questions, do not hesitate to call.

 

Sincerely,

 

 

 

 

By:

 

Name:

 

Title:

 

 

[please check appropriate box]

 

ACCEPTED□

 

REJECTED□

 

[TENANT'S SIGNATURE BLOCK]

 

 

 

By:

 

Name:

 

Title:

 

Date:

 

 

Enclosure [attach depiction of Refusal Space]

 

 

EXHIBIT G-2, - Page 2

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EXHIBIT H

 

WAIVER OF CONSUMER RIGHTS

 

I waive my rights under the Deceptive Trade Practices-Consumer Protection Act,
Section 17.41 et seq., Texas Business & Commerce Code, a law that gives
consumers special rights and protections. After consultation with an attorney of
my own selection, I voluntarily consent to this waiver.

 

LANDLORD:

 

, a

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

TENANT:

 

, a

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

EXHIBIT H, Waiver of Consumer Rights - Page 1

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EXHIBIT I

 

RENT ABATEMENT PROVISIONS

 

Abatement of Basic Rent:

 

Basic Rent for Suites 100 & 110 shall be conditionally abated commencing on the
Commencement Date through and including August 31, 2019. Commencing on September
1, 2019, Tenant shall make Basic Rent payments for Suites 100 & 110.

 

Basic Rent for Suite 150 shall be conditionally abated commencing on the
Commencement Date through and including March 30, 2020. Commencing on April 1,
2020, Tenant shall make Basic Rent payments for Suite 150.

 

Abatement of Additional Rent:

 

Additional Rent for Suites 100 & 110 shall be conditionally abated commencing on
the Commencement Date through and including the earlier to occur of (i) Tenant's
occupancy of Suites 100 & 110 for the Permitted Use or (ii) August 31, 2019.
Commencing on such date, Tenant shall make Additional Rent payments for Suites
100 & 110.

 

Additional Rent for Suite 150 shall be conditionally abated commencing on the
Commencement Date through and including the earlier to occur of (i) Tenant's
occupancy of Suite 150 for the Permitted Use or (ii) March 30, 2020. Commencing
on such date, Tenant shall make Additional Rent payments for Suite 150.

 

EXHIBIT I, Rent Abatement Provisions - Page 1

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EXHIBIT J

 

LAB AREA – PERMITTED USE

 

Subject to the Lease provisions above, Tenant shall be permitted to use the Lab
Area for a 6,000 – 8,000 square foot Lab that meets the following criteria:

 

 

1.

Biosafety level 2

 

2.

A dedicated temperature and air quality controlled environment (separate HVAC
with HEPA filtration) of no more than 1,500 sf to support a vivarium (no greater
than 1,000 sf of the total 1,500 sf) for small rodent work

 

3.

Enables the use and piping of compressed gas and medium to high speed
centrifuges

 

4.

Small quantities of flammable solvents (but these are stored in a fire-safe
cupboards)

 

5.

Venting for chemical fume hoods

 

6.

Venting to the exterior for mass spectrometry instrumentation

 

7.

Ability to use x-ray emitting device, Tenant will monitor exposure and register
with the State of Texas

EXHIBIT J, Lab Area – Permitted Use - Page 1