Exhibit 10.1

 

LEASE AGREEMENT

 

THIS LEASE AGREEMENT (this “Lease”) is made this 20 day of November, 2019,
between 3535/3565 GENERAL ATOMICS COURT, LLC, a Delaware limited liability
company (“Landlord”), and ONCOSEC MEDICAL INCORPORATED, a Nevada corporation
(“Tenant”).

 

Building: 3565 General Atomics Court, San Diego, California     Premises: That
portion of the Building commonly known as Suite 100B, containing approximately
12,442 rentable square feet, as determined by Landlord, as shown on Exhibit A.  
  Project: The real property on which the Building containing the Premises is
located, together with all improvements thereon and appurtenances thereto as
described on Exhibit B.     Base Rent: $4.50 per rentable square foot of the
Premises per month, subject to adjustment pursuant to Section 4 hereof.

 

Rentable Area of Premises: 12,442 sq. ft.

 

Rentable Area of Building: 37,899 sq. ft.

 

Rentable Area of Project: 221,010 sq. ft.

 

Tenant’s Share of Operating Expenses of Building: 32.83%

 

Building’s Share of Operating Expenses of Project: 17.15%

 

Security Deposit: $55,989 Target Commencement Date: October 1, 2020

 

Rent Adjustment Percentage: 3%

 

Base Term: Beginning on the Commencement Date and ending 36 months from the
Commencement Date. For clarity, if the Commencement Date occurs on the first day
of a month, the Base Term shall be measured from that date. If the Commencement
Date occurs on a day other than the first day of a month, the Base Term shall be
measured from the first day of the following month.     Permitted Use: Research
and development laboratory, office and other uses consistent with the character
of the Project and otherwise in compliance with the provisions of Section 7
hereof.

 

Address for Rent Payment: Tenant’s Notice Address: P.O. Box 975383 3565 General
Atomics Court, Suite 100B Dallas, TX 75397-5383 San Diego, California 92121  
Attention: Lease Administrator

 

Landlord’s Notice Address:

26 North Euclid Avenue

Pasadena, CA 91101

Attention: Corporate Secretary

 

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The following Exhibits and Addenda are attached hereto and incorporated herein
by this reference:

 

[X] EXHIBIT A - PREMISES DESCRIPTION [X] EXHIBIT B - DESCRIPTION OF PROJECT
[   ] EXHIBIT C - INTENTIONALLY OMITTED [X] EXHIBIT D - COMMENCEMENT DATE [X]
EXHIBIT E - RULES AND REGULATIONS [X] EXHIBIT F - TENANT’S PERSONAL PROPERTY [X]
EXHIBIT G - MAINTENANCE OBLIGATIONS [X] EXHIBIT H - CONTROL AREA [X] EXHIBIT I -
STORAGE AREAS [X] EXHIBIT J - SIGNAGE

 

1. Lease of Premises. Upon and subject to all of the terms and conditions
hereof, Landlord hereby leases the Premises to Tenant and Tenant hereby leases
the Premises from Landlord. The portions of the Project which are for the
non-exclusive use of tenants of the Project are collectively referred to herein
as the “Common Areas.” Tenant shall have the non-exclusive right during the Term
to use the Common Areas along with others having the right to use the Common
Areas. Landlord reserves the right to modify Common Areas, provided that such
modifications do not materially adversely affect Tenant’s use of the Premises
for the Permitted Use. From and after the Commencement Date through the
expiration of the Term, Tenant shall have access to the Building and the
Premises 24 hours a day, 7 days a week, except in the case of emergencies, as
the result of Legal Requirements, the performance by Landlord of any
installation, maintenance or repairs, or any other temporary interruptions, and
otherwise subject to the terms of this Lease.

 

2. Delivery; Acceptance of Premises; Commencement Date. The “Commencement Date”
shall be the earlier to occur of (i) October 1, 2020, or (ii) the day after the
termination of the Existing Lease (as defined below), if the Existing Lease
terminates prior to September 30, 2020. Upon request of Landlord, Tenant shall
execute and deliver a written acknowledgment of the Commencement Date and the
expiration date of the Base Term when such are established in the form of the
“Acknowledgement of Commencement Date” attached to this Lease as Exhibit D;
provided, however, Tenant’s failure to execute and deliver such acknowledgment
shall not affect Landlord’s rights hereunder. The “Term” of this Lease shall be
the Base Term, as defined above on the first page of this Lease and the
Extension Term which Tenant may elect pursuant to Section 39 hereof.

 

Landlord and Tenant acknowledge and agree that, as of the date hereof, the
Premises is currently subject to a lease agreement (as the same has been and may
in the future may be amended, the “Existing Lease”) between Landlord and
Vividion Therapeutics, Inc., a Delaware corporation (“Vividion”). Tenant agrees
that Landlord has no obligation under this Lease with respect to the Premises
prior to the Commencement Date. As of the date of this Lease, Tenant occupies
the Premises pursuant to a sublease agreement between Vividion and Tenant (the
“Existing Sublease”).

 

Commencing on the Commencement Date, Landlord shall make available to Tenant a
tenant improvement allowance equal to $10.00 per rentable square foot of the
Premises, or $124,420 in the aggregate (the “TI Allowance”) for the payment of
design, permit and construction costs incurred in connection with the
construction of non-structural, cosmetic improvements in the Premises desired by
and performed by Tenant and which improvements shall be of a fixed and permanent
nature, as reasonably approved by Landlord (the “Tenant Improvements”). Tenant
acknowledges that upon the expiration of the Term of the Lease, the Tenant
Improvements paid for out of the TI Allowance shall become the property of
Landlord and may not be removed by Tenant. Except for the TI Allowance, Tenant
shall be solely responsible for all of the costs of the Tenant Improvements. The
Tenant Improvements shall be treated as Alterations and shall be undertaken
pursuant to Section 12 of this Lease. The contractor for the Tenant Improvements
shall be selected by Tenant, subject to Landlord’s approval, which approval
shall not be unreasonably withheld, conditioned or delayed. Prior to the
commencement of the Tenant Improvements, Tenant shall deliver to Landlord a copy
of any contract with Tenant’s contractors (including the architect), and
certificates of insurance from any contractor performing any part of the Tenant
Improvements evidencing industry standard commercial general liability,
automotive liability, “builder’s risk”, and workers’ compensation insurance.
Tenant shall cause the general contractor to provide a certificate of insurance
naming Landlord, Alexandria Real Estate Equities, Inc., and Landlord’s lender
(if any) as additional insureds for the general contractor’s liability coverages
required above. During the course of design and construction of the Tenant
Improvements, Landlord shall reimburse Tenant for the cost of the Tenant
Improvements once a month against a draw request in Landlord’s standard form,
containing evidence of payment of the applicable costs and lien waivers
(including a conditional lien release for each progress payment and
unconditional lien releases for the prior month’s progress payments), to the
extent of Landlord’s approval thereof for payment, no later than 30 days
following receipt of such draw request. Upon completion of the Tenant
Improvements (and prior to any final disbursement of the TI Allowance) Tenant
shall deliver to Landlord the following items: (i) statements setting forth the
names of all contractors and subcontractors who did work on the Tenant
Improvements and final lien waivers from all such contractors and
subcontractors; and (ii) “as built” plans or marked-up construction drawings for
the Tenant Improvements. Landlord shall be entitled to receive the benefit of
all construction warranties and manufacturer’s equipment warranties relating to
equipment installed in the Premises as part of the Tenant Improvements.
Notwithstanding the foregoing, if the cost of the Tenant Improvements exceeds
the TI Allowance, Tenant shall be required to pay such excess prior to the
distribution of the then-remaining unpaid TI Allowance. The TI Allowance shall
only be available for use by Tenant for the construction of the Tenant
Improvements until the date that is 6 months after the Commencement Date, and
any portion of the TI Allowance which has not been requested for reimbursement
by Tenant pursuant to the terms of this paragraph on or before the date that is
6 months after the Commencement Date shall be forfeited and shall not be
available for use by Tenant.

 

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Notwithstanding anything to the contrary contained in this Lease, Tenant and
Landlord acknowledge and agree that the effectiveness of this Lease shall be
subject to the following conditions precedent (collectively, the “Conditions
Precedent”) having been satisfied: (i) Vividion shall have waived in writing its
right to extend the term of the Existing Lease, and (ii) the tenant that has a
right of first refusal with respect to the Premises, waiving its right of first
refusal, all on terms and conditions acceptable to Landlord, in Landlord’s sole
and absolute discretion. In the event that the Conditions Precedent are not
satisfied, Landlord shall have the right to terminate this Lease upon delivery
of written notice to Tenant. Landlord shall have no liability whatsoever to
Tenant relating to or arising from Landlord’s inability or failure to cause the
Conditions Precedent to be satisfied.

 

Except as otherwise expressly set forth in this Lease: (i) Tenant shall accept
the Premises in their condition as of the Commencement Date; (ii) Landlord shall
have no obligation for any defects in the Premises; and (iii) Tenant’s occupancy
of the Premises pursuant to the Existing Sublease shall be conclusive evidence
that Tenant accepts the Premises and that the Premises were in good condition as
of the Commencement Date.

 

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

 

3. Rent.

 

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

 

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Notwithstanding anything to the contrary contained herein, so long as Tenant is
not then-currently in Default (as defined in Section 20), Tenant shall not be
required to pay Base Rent for the period commencing on the first day of the 2nd
full calendar month following the Commencement Date through the last day of the
4th full calendar month following the Commencement Date (the “Abatement
Period”). Tenant shall resume paying Base Rent with respect to the entire
Premises on the first day of the 5th full calendar month following the
Commencement Date.

 

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

 

4. Base Rent Adjustments. Base Rent shall be increased on each annual
anniversary of the Commencement Date (or, if the Commencement Date occurs on a
day other than the first day of a calendar month, then on the first day of the
first full calendar month following the Commencement Date) (each an “Adjustment
Date”) by multiplying the Base Rent payable immediately before such Adjustment
Date by the Rent Adjustment Percentage and adding the resulting amount to the
Base Rent payable immediately before such Adjustment Date. Base Rent, as so
adjusted, shall thereafter be due as provided herein. Base Rent adjustments for
any fractional calendar month shall be prorated.

 

5. Operating Expense Payments. Landlord shall deliver to Tenant a written
estimate of Operating Expenses for each calendar year during the Term (the
“Annual Estimate”), which may be revised by Landlord from time to time during
such calendar year. Commencing on the Commencement Date and continuing
thereafter on the first day of each calendar month during the Term, Tenant shall
pay Landlord an amount equal to 1/12th of Tenant’s Share of the Annual Estimate.
Payments for any fractional calendar month shall be prorated.

 

The term “Operating Expenses” means all costs and expenses of any kind or
description whatsoever actually incurred or accrued each calendar year by
Landlord with respect to the Building (including the Building’s Share of all
costs and expenses of any kind or description incurred or accrued by Landlord
with respect to the Project which are not specific to the Building or any other
building located in the Project) (including, without duplication, (w) Taxes (as
defined in Section 9), (x) capital repairs and improvements amortized over the
lesser of 10 years and the useful life of such capital items, (y) the cost
(including, without limitation, of any subsidies which Landlord may provide in
connection with the Project Amenities) of the Common Areas amenities (the
“Project Amenities”) now or hereafter located at the Project, and (z) the costs
of Landlord’s third party property manager or, if there is no third party
property manager, administration rent in the amount of 3.0% of Base Rent
(provided that during the Abatement Period, Tenant shall nonetheless be required
to pay administration rent each month equal to the amount of the administration
rent that Tenant would have been required to pay in the absence of there being
an Abatement Period)), excluding only:

 

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

 

(b) capital expenditures for expansion of the Project;

 

(c) interest, principal payments of Mortgage (as defined in Section 27) debts of
Landlord, financing costs and amortization of funds borrowed by Landlord,
whether secured or unsecured;

 

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(d) depreciation of the Project (except for capital improvements, the cost of
which are includable in Operating Expenses pursuant to and in accordance with
the terms of this Section 5);

 

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

 

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

 

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

 

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

 

(i) salaries, wages, benefits and other compensation paid to officers and
employees of Landlord who are not assigned in whole or in part to the operation,
management, maintenance or repair of the Project (which costs shall be prorated
if such officers and employees are assigned to the Project only in part in
proportion to the amount of time spent by such officers and employees on the
Project) and any salaries of any individuals who hold a position which is
generally considered to be higher in rank than the position of the
vice-president (for the avoidance of any doubt, the salaries, wages, benefits
and other compensation paid to any asset manager or chief engineer of the
Project are not excluded);

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

(q) costs incurred in the sale or refinancing of the Project;

 

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

 

(s) costs arising from the gross negligence or intentional misconduct of
Landlord or Landlord’s officers, directors, employees, managers or agents;

 

(t) any costs incurred to remove, study, test or remediate Hazardous Materials
in or about the Building or the Project (provided, however, that the foregoing
is in no event intended to limit Tenant’s obligations under Section 28 or
Section 30 of this Lease);

 

(u) the cost of capital repairs and replacements of Structural Items (as defined
in Section 13), unless Tenant or any Tenant Party is responsible for the cause
of the repairs or replacements;

 

(v) costs in connection with the Alexandria Regional Amenities (as defined in
Section 40) other than the Amenities Fee (as defined in Section 40) and other
costs payable by Tenant pursuant to Section 40;

 

(w) reserves for future capital replacements;

 

(x) costs occasioned by condemnation;

 

(y) insurance deductibles in excess of deductibles that Tenant can demonstrate
are in excess of customary deductible amounts carried by institutional owners of
comparable projects in the Torrey Pines area of San Diego; and

 

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

 

For the avoidance of doubt, capital costs incurred by Landlord prior to the
Commencement Date may not be included as Operating Expenses.

 

Notwithstanding anything to the contrary contained herein, any earthquake
deductible payable by Tenant under this Lease shall be amortized with interest
in equal monthly installments over the remaining Term.

 

(aa) Notwithstanding anything to the contrary contained herein, in no event
shall Landlord be entitled to make any profit from Landlord’s collection of
Operating Expenses.

 

In addition, notwithstanding anything to the contrary contained in this Lease,
Operating Expenses incurred or accrued by Landlord with respect to any capital
improvements which are reasonably expected by Landlord to reduce overall
Operating Expenses (for example, without limitation, by reducing energy usage at
the Project) (the “Energy Savings Costs”) shall be amortized over a period of
years equal to the least of (A) 7 years, (B) the useful life of such capital
items, or (C) the quotient of (i) the Energy Savings Costs, divided by (ii) the
annual amount of Operating Expenses reasonably expected by Landlord to be saved
as a result of such capital improvements.

 

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

 

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The Annual Statement shall be final and binding upon Tenant unless Tenant,
within 120 days after Tenant’s receipt thereof, shall contest any item therein
by giving written notice to Landlord, specifying each item contested and the
reason therefor. If, during such 120 day period, Tenant reasonably and in good
faith questions or contests the accuracy of Landlord’s statement of Tenant’s
Share of Operating Expenses, Landlord will provide Tenant with access to
Landlord’s books and records relating to the operation of the Project and such
information as Landlord reasonably determines to be responsive to Tenant’s
questions (the “Expense Information”). If after Tenant’s review of such Expense
Information, Landlord and Tenant cannot agree upon the amount of Tenant’s Share
of Operating Expenses, then Tenant shall have the right to have an independent
regionally recognized public accounting firm selected by Tenant and approved by
Landlord (which approval shall not be unreasonably withheld or delayed), working
pursuant to a fee arrangement other than a contingent fee (at Tenant’s sole cost
and expense), audit and/or review the Expense Information for the year in
question (the “Independent Review”). The results of any such Independent Review
shall be binding on Landlord and Tenant. If the Independent Review shows that
the payments actually made by Tenant with respect to Operating Expenses for the
calendar year in question exceeded Tenant’s Share of Operating Expenses for such
calendar year, Landlord shall at Landlord’s option either (i) credit the excess
amount to the next succeeding installments of Rent, or (ii) pay the excess to
Tenant within 30 days after delivery of such statement, except that after the
expiration or earlier termination of this Lease or if Tenant is delinquent in
its obligation to pay Rent, Landlord shall pay the excess to Tenant after
deducting all other amounts due Landlord. If the Independent Review shows that
Tenant’s payments with respect to Operating Expenses for such calendar year were
less than Tenant’s Share of Operating Expenses for the calendar year, Tenant
shall pay the deficiency to Landlord within 30 days after delivery of such
statement. If the Independent Review shows that Tenant has overpaid with respect
to Operating Expenses by more than 5% then Landlord shall reimburse Tenant for
all costs incurred by Tenant for the Independent Review. Operating Expenses for
the calendar years in which Tenant’s obligation to share therein begins and ends
shall be prorated. Notwithstanding anything set forth herein to the contrary, if
the Building is not at least 95% occupied on average during any year of the
Term, Tenant’s Share of Operating Expenses for such year shall be computed as
though the Building had been 95% occupied on average during such year.

 

“Tenant’s Share” shall be the percentage set forth on the first page of this
Lease as Tenant’s Share as reasonably adjusted by Landlord for changes in the
physical size of the Premises or the Project occurring after the Commencement
Date. If Landlord has a reasonable basis for doing so, Landlord may equitably
increase Tenant’s Share for any item of expense or cost reimbursable by Tenant
that relates to a repair, replacement, or service that benefits only the
Premises or only a portion of the Project that includes the Premises or that
varies with occupancy or use. Base Rent, Tenant’s Share of Operating Expenses
and all other amounts payable by Tenant to Landlord hereunder are collectively
referred to herein as “Rent.”

 

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6. Security Deposit. Tenant shall deposit with Landlord, upon delivery of an
executed copy of this Lease to Landlord, a security deposit (the “Security
Deposit”) for the performance of all of Tenant’s obligations hereunder in the
amount set forth on page 1 of this Lease, which Security Deposit shall be in the
form of an unconditional and irrevocable letter of credit (the “Letter of
Credit”): (i) in form and substance reasonably satisfactory to Landlord, (ii)
naming Landlord as beneficiary, (iii) expressly allowing Landlord to draw upon
it at any time from time to time by delivering to the issuer notice that
Landlord is entitled to draw thereunder, (iv) issued by an FDIC-insured
financial institution reasonably satisfactory to Landlord, and (v) redeemable by
presentation of a sight draft in the state of Landlord’s choice. If Tenant does
not provide Landlord with a substitute Letter of Credit complying with all of
the requirements hereof at least 10 days before the stated expiration date of
any then current Letter of Credit, Landlord shall have the right to draw the
full amount of the current Letter of Credit and hold the funds drawn in cash
without obligation for interest thereon as the Security Deposit; provided,
however, that Tenant may at any time thereafter deliver a substitute Letter of
Credit, at which time Landlord shall promptly release the funds drawn to Tenant.
The Security Deposit shall be held by Landlord as security for the performance
of Tenant’s obligations under this Lease. The Security Deposit is not an advance
rental deposit or a measure of Landlord’s damages in case of Tenant’s default.
Upon each occurrence of a Default (as defined in Section 20), Landlord may use
all or any part of the Security Deposit to pay delinquent payments due under
this Lease, future rent damages under California Civil Code Section 1951.2, and
the cost of any damage, injury, expense or liability caused by such Default,
without prejudice to any other remedy provided herein or provided by law.
Landlord’s right to use the Security Deposit under this Section 6 includes the
right to use the Security Deposit to pay future rent damages following the
termination of this Lease pursuant to Section 21(c) below. Upon any use of all
or any portion of the Security Deposit, Tenant shall pay Landlord within 10 days
after written demand the amount that will restore the Security Deposit to the
amount set forth on Page 1 of this Lease. Tenant hereby waives the provisions of
any law, now or hereafter in force, including, without limitation, California
Civil Code Section 1950.7, which provide that Landlord may claim from a security
deposit only those sums reasonably necessary to remedy defaults in the payment
of Rent, to repair damage caused by Tenant or to clean the Premises, it being
agreed that Landlord may, in addition, claim those sums reasonably necessary to
compensate Landlord for any other loss or damage, foreseeable or unforeseeable,
caused by the act or omission of Tenant or any officer, employee, agent or
invitee of Tenant. Upon bankruptcy or other debtor-creditor proceedings against
Tenant, the Security Deposit shall be deemed to be applied first to the payment
of Rent and other charges due Landlord for periods prior to the filing of such
proceedings. If Tenant shall fully perform every provision of this Lease to be
performed by Tenant, the Security Deposit, or any balance thereof (i.e., after
deducting therefrom all amounts to which Landlord is entitled under the
provisions of this Lease), shall be returned to Tenant (or, at Landlord’s
option, to the last assignee of Tenant’s interest hereunder) within 60 days
after the expiration or earlier termination of this Lease.

 

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

 

7. Use. The Premises shall be used solely for the Permitted Use set forth in the
basic lease provisions on page 1 of this Lease, and in compliance with all laws,
orders, judgments, ordinances, regulations, codes, directives, permits,
licenses, covenants and restrictions now or hereafter applicable to the
Premises, and to the use and occupancy thereof, including, without limitation,
the Americans With Disabilities Act, 42 U.S.C. § 12101, et seq. (together with
the regulations promulgated pursuant thereto, “ADA”) (collectively, “Legal
Requirements” and each, a “Legal Requirement”). Tenant shall, upon 10 days’
written notice from Landlord, discontinue any use of the Premises which is
declared by any Governmental Authority (as defined in Section 9) having
jurisdiction to be a violation of a Legal Requirement; provided, however, that
if the applicable Governmental Authority grants to Tenant time in addition to
such 10 day period to discontinue its use of the Premises, Tenant may continue
to operate in the Premises for such additional period granted by the applicable
Governmental Authority. Tenant will not use or permit the Premises to be used
for any purpose or in any manner that would void Tenant’s or Landlord’s
insurance, increase the insurance risk, or cause the disallowance of any
sprinkler or other credits. Tenant shall not permit any part of the Premises to
be used as a “place of public accommodation”, as defined in the ADA or any
similar legal requirement. Tenant shall reimburse Landlord promptly upon demand
for any additional premium charged for any such insurance policy by reason of
Tenant’s failure to comply with the provisions of this Section or otherwise
caused by Tenant’s particular use of the Premises. Tenant will use the Premises
in a careful, safe and proper manner and will not commit or permit waste,
overload the floor or structure of the Premises, subject the Premises to use
that would damage the Premises or obstruct or interfere with the rights of
Landlord or other tenants or occupants of the Project, including conducting or
giving notice of any auction, liquidation, or going out of business sale on the
Premises, or using or allowing the Premises to be used for any unlawful purpose.
Tenant shall cause any equipment or machinery to be installed in the Premises so
as to reasonably prevent sounds or vibrations from the Premises from extending
into Common Areas, or other space in the Project. Tenant shall not place any
machinery or equipment which would overload the floor in or upon the Premises or
transport or move such items through the Common Areas of the Project or in the
Project elevators without the prior written consent of Landlord, which consent
shall not be unreasonably withheld, conditioned or delayed. Tenant shall not,
without the prior written consent of Landlord, use the Premises in any manner
which will require ventilation, air exchange, heating, gas, steam, electricity
or water beyond the existing capacity of the Building (unless Tenant agrees to
pay the cost of any increase in capacity).

 

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Landlord shall be responsible, at Landlord’s cost and expense, for the
compliance of the Common Areas of the Project with Legal Requirements as of the
Commencement Date. Following the Commencement Date, Landlord shall, as an
Operating Expense (to the extent such Legal Requirement is generally applicable
to similar buildings in the area in which the Project is located) and at
Tenant’s expense (to the extent such Legal Requirement is triggered by reason of
Tenant’s, as compared to other tenants of the Project, particular use of the
Premises or Tenant’s Alterations) make any alterations or modifications to the
Common Areas or the exterior of the Building that are required by Legal
Requirements. Except as provided in the two immediately preceding sentences,
Tenant, at its sole expense, shall make any alterations or modifications to the
interior of the Premises that are required by Legal Requirements (including,
without limitation, compliance of the Premises with the ADA) related to Tenant’s
particular use or occupancy of the Premises or any Tenant Alterations.
Notwithstanding any other provision herein to the contrary, Tenant shall be
responsible for any and all demands, claims, liabilities, losses, costs,
expenses, actions, causes of action, damages or judgments, and all reasonable
expenses incurred in investigating or resisting the same (including, without
limitation, reasonable attorneys’ fees, charges and disbursements and costs of
suit) (collectively, “Claims”) arising out of or in connection with Legal
Requirements related to Tenant’s particular use or occupancy of the Premises or
Tenant’s Alterations, and Tenant shall indemnify, defend, hold and save Landlord
harmless from and against any and all Claims arising out of or in connection
with any failure of the Premises to comply with any Legal Requirement related to
Tenant’s particular use or occupancy of the Premises or Tenant’s Alterations.

 

Tenant acknowledges that Landlord may, but shall not be obligated to, seek to
obtain Leadership in Energy and Environmental Design (LEED), WELL Building
Standard, or other similar “green” certification with respect to the Project
and/or the Premises, and Tenant agrees to reasonably cooperate with Landlord,
and to provide such information and/or documentation as Landlord may reasonably
request, in connection therewith.

 

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

 

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9. Taxes. Landlord shall pay, as part of Operating Expenses, all taxes, levies,
fees, assessments and governmental charges of any kind, existing as of the
Commencement Date or thereafter enacted (collectively referred to as “Taxes”),
imposed by any federal, state, regional, municipal, local or other governmental
authority or agency, including, without limitation, quasi-public agencies
(collectively, “Governmental Authority”) during the Term, including, without
limitation, all Taxes: (i) imposed on or measured by or based, in whole or in
part, on rent payable to (or gross receipts received by) Landlord under this
Lease and/or from the rental by Landlord of the Project or any portion thereof,
or (ii) based on the square footage, assessed value or other measure or
evaluation of any kind of the Premises or the Project, or (iii) assessed or
imposed by or on the operation or maintenance of any portion of the Premises or
the Project, including parking, or (iv) assessed or imposed by, or at the
direction of, or resulting from Legal Requirements, or interpretations thereof,
promulgated by any Governmental Authority, or (v) imposed as a license or other
fee, charge, tax, or assessment on Landlord’s business or occupation of leasing
space in the Project. Landlord may contest by appropriate legal proceedings the
amount, validity, or application of any Taxes or liens securing Taxes.
Notwithstanding anything to the contrary contained herein, Landlord shall only
charge Tenant for assessments as if those assessments were paid by Landlord over
the longest possible term which Landlord is permitted to pay for the applicable
assessments without additional charge other than interest, if any, provided
under the terms of the underlying assessments. Taxes shall not include (a) any
net income taxes imposed on Landlord except to the extent such net income taxes
are in substitution for any Taxes payable hereunder, (b) excess profit taxes,
franchise taxes, transfer taxes, capital stock taxes, gift taxes or estate,
inheritance or succession taxes imposed on or payable by Landlord, (c) any tax,
assessment or charge levied on Landlord’s rental income, unless such taxes or
assessments are in substitution for any Taxes payable hereunder, (d) any taxes
or assessments in excess of the amount which would be payable if such tax or
assessment were paid in installments over the longest possible term, or (e) any
tax, assessment or charge imposed on land or improvements other than the
Project. Tenant shall pay, prior to delinquency, any and all Taxes levied or
assessed against any personal property or trade fixtures placed by Tenant in the
Premises, whether levied or assessed against Landlord or Tenant. If any Taxes on
Tenant’s personal property or trade fixtures are levied against Landlord or
Landlord’s property, or if the assessed valuation of the Project is increased by
a value attributable to improvements in or alterations to the Premises, whether
owned by Landlord or Tenant and whether or not affixed to the real property so
as to become a part thereof, higher than the base valuation on which Landlord
from time-to-time allocates Taxes to all tenants in the Project, Landlord shall
have the right, but not the obligation, to pay such Taxes. Landlord’s reasonable
determination of any excess assessed valuation shall be binding and conclusive,
absent manifest error. The amount of any such payment by Landlord shall
constitute Additional Rent due from Tenant to Landlord immediately upon demand.

 

10. Parking. Subject to all applicable Legal Requirements, Force Majeure, a
Taking (as defined in Section 19 below) and the exercise by Landlord of its
rights hereunder, Tenant shall have the right, in common with other tenants of
the Project, to use 2.5 parking spaces per 1,000 rentable square feet of the
Premises, which shall be located in those areas designated for non-reserved
parking, subject in each case to Landlord’s rules and regulations. Landlord
shall not be responsible for enforcing Tenant’s parking rights against any third
parties, including other tenants of the Project.

 

11. Utilities, Services. Landlord shall provide, subject to the terms of this
Section 11, water, electricity, heat, light, power, HVAC, sewer, and other
utilities (including gas and fire sprinklers), and, with respect to the Common
Areas only, refuse and trash collection and janitorial services (collectively,
“Utilities”). Landlord shall pay, as Operating Expenses or subject to Tenant’s
reimbursement obligation below, for all Utilities used on the Premises, all
maintenance charges for Utilities, and any storm sewer charges or other similar
charges for Utilities imposed by any Governmental Authority or Utility provider,
and any taxes, penalties, surcharges or similar charges thereon. Landlord may
cause, at Tenant’s reasonable expense, any Utilities to be separately metered or
charged directly to Tenant by the provider. Tenant shall pay directly to the
Utility provider, prior to delinquency, any separately metered Utilities and
services which may be furnished to Tenant or the Premises during the Term.
Tenant shall pay, as part of Operating Expenses, its share of all charges for
jointly metered Utilities based upon consumption, as reasonably determined by
Landlord. No interruption or failure of Utilities, from any cause whatsoever
other than Landlord’s willful misconduct, shall result in eviction or
constructive eviction of Tenant, termination of this Lease or the abatement of
Rent. Tenant agrees to limit use of water and sewer with respect to Common Areas
to normal restroom use. Tenant shall be responsible for obtaining and paying for
its own janitorial services, and refuse and trash collection for the Premises.
Utilities shall be available to the Premises 24 hours per day, 7 days per week,
except in the case of emergencies, as the result of Legal Requirements, the
failure of any Utility provider to provide such Utilities, the performance by
Landlord or any Utility provider of any installation, maintenance or repairs, or
any other temporary interruptions.

 

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Notwithstanding anything to the contrary set forth herein, if (i) a stoppage of
an Essential Service (as defined below) to the Premises shall occur and such
stoppage is due solely to the gross negligence or willful misconduct of Landlord
or any Landlord Party and not due in any part to any act or omission on the part
of Tenant or any Tenant Party or any matter beyond Landlord’s reasonable control
(any such stoppage of an Essential Service being hereinafter referred to as a
“Service Interruption”), and (ii) such Service Interruption continues for more
than 5 consecutive days after Landlord shall have received written notice
thereof from Tenant, and (iii) as a result of such Service Interruption, the
conduct of Tenant’s normal operations in the Premises are materially and
adversely affected, then, there shall be an abatement of one day’s Base Rent for
each day during which such Service Interruption continues after such 5 day
period; provided, however, that if any part of the Premises is reasonably
useable for Tenant’s normal business operations or if Tenant conducts all or any
part of its operations in any portion of the Premises notwithstanding such
Service Interruption, then the amount of each daily abatement of Base Rent shall
only be proportionate to the nature and extent of the interruption of Tenant’s
normal operations or ability to use the Premises. Except as expressly provided
in the immediately preceding paragraph, the rights granted to Tenant under this
paragraph shall be Tenant’s sole and exclusive remedy resulting from a failure
of Landlord to provide the Essential Services, and Landlord shall not otherwise
be liable for any loss or damage suffered or sustained by Tenant resulting from
any failure or cessation of services. For purposes hereof, the term “Essential
Services” shall mean the following services: HVAC service, water, sewer and
electricity, but in each case only to the extent that Landlord has an obligation
to provide same to Tenant under this Lease. This paragraph shall not apply to
any events described in Section 18 or 19.

 

12. Alterations and Tenant’s Property. Any alterations, additions, or
improvements made to the Premises by or on behalf of Tenant (other than
Landlord’s Work), including additional locks or bolts of any kind or nature upon
any doors or windows in the Premises, but excluding installation, removal or
realignment of furniture systems (other than removal of furniture systems owned
or paid for by Landlord) not involving any modifications to the structure or
connections (other than by ordinary plugs or jacks) to Building Systems (as
defined in Section 13) (“Alterations”), shall be subject to Landlord’s prior
written consent, which may be given or withheld in Landlord’s sole discretion if
any such Alteration materially and/or adversely affects the structure or
Building Systems and shall not be otherwise unreasonably withheld. Tenant may
construct nonstructural Alterations in the Premises without Landlord’s prior
approval if the aggregate cost of all such work in any 12 month period does not
exceed $100,000 (a “Notice-Only Alteration”), provided Tenant notifies Landlord
in writing of such intended Notice-Only Alteration, and such notice shall be
accompanied by plans, specifications, work contracts and such other information
concerning the nature and cost of the Notice-Only Alteration as may be
reasonably requested by Landlord, which notice and accompanying materials shall
be delivered to Landlord not less than 15 business days in advance of any
proposed construction. If Landlord approves any Alterations, Landlord may impose
such conditions on Tenant in connection with the commencement, performance and
completion of such Alterations as Landlord may deem appropriate in Landlord’s
reasonable discretion. Any request for approval shall be in writing, delivered
not less than 15 business days in advance of any proposed construction, and
accompanied by plans, specifications, bid proposals, work contracts and such
other information concerning the nature and cost of the proposed Alterations as
may be reasonably requested by Landlord, including the identities and mailing
addresses of all persons performing work or supplying materials. Landlord’s
right to review plans and specifications and to monitor construction shall be
solely for its own benefit, and Landlord shall have no duty to ensure that such
plans and specifications or construction comply with applicable Legal
Requirements. Tenant shall cause, at its sole cost and expense, all Alterations
to comply with applicable insurance requirements and with Legal Requirements and
shall implement at its sole cost and expense any alteration or modification
required by Legal Requirements as a result of any Alterations. Other than in
connection with a Notice-Only Alteration (with respect to which no fee shall be
payable), Tenant shall pay to Landlord, as Additional Rent, on demand an amount
equal to 3% of all charges incurred by Tenant or its contractors or agents in
connection with any Alteration to cover Landlord’s overhead and expenses for
plan review, coordination, scheduling and supervision. Before Tenant begins any
Alteration, Landlord may post on and about the Premises notices of
non-responsibility pursuant to applicable law. Tenant shall reimburse Landlord
for, and indemnify and hold Landlord harmless from, any expense incurred by
Landlord by reason of faulty work done by Tenant or its contractors, delays
caused by such work, or inadequate cleanup.

 

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

 

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

 

For purposes of this Lease, (x) “Removable Installations” means any items listed
on Exhibit F attached hereto and any items agreed by Landlord in writing to be
included on Exhibit F in the future, (y) “Tenant’s Property” means Removable
Installations and, other than Installations, any personal property or equipment
of Tenant that may be removed without material damage to the Premises, and (z)
“Installations” means all property of any kind paid for by Landlord, all
Alterations, all fixtures, and all partitions, hardware, built-in machinery,
built-in casework and cabinets and other similar additions, equipment, property
and improvements built into the Premises so as to become an integral part of the
Premises, including, without limitation, fume hoods which penetrate the roof or
plenum area, built-in cold rooms, built-in warm rooms, walk-in cold rooms,
walk-in warm rooms, deionized water systems, glass washing equipment,
autoclaves, chillers, built-in plumbing, electrical and mechanical equipment and
systems, and any power generator and transfer switch.

 

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13. Landlord’s Repairs. Landlord shall, at Landlord’s sole expense (and not as
an Operating Expense), be responsible for capital repairs and replacements of
the roof (not including the roof membrane), exterior walls, structural walls,
concrete flooring and foundation of the Building (“Structural Items”) unless the
need for such repairs or replacements is caused by Tenant or any Tenant Parties
(reasonable wear and tear excluded), in which case Tenant shall, subject to
Section 17, bear the full cost to repair or replace such Structural Items.
Landlord shall, as an Operating Expense (except to the extent the cost thereof
is expressly excluded from Operating Expenses pursuant to Section 5 hereof), be
responsible for the routine maintenance and repairs of such Structural Items. In
addition, Landlord, as an Operating Expense (except to the extent the cost
thereof is expressly excluded from Operating Expenses pursuant to Section 5
hereof), shall maintain the roof membrane and all of the exterior, parking and
other Common Areas of the Project, including HVAC, plumbing, fire sprinklers,
elevators and all other building systems serving the Premises and other portions
of the Project (“Building Systems”), in good repair, reasonable wear and tear
excluded. Subject to the terms of Section 17 hereof, losses and damages caused
by Tenant, or by any of Tenant’s agents, servants, employees, invitees and
contractors (each individually, a “Tenant Party” and collectively, “Tenant
Parties”) shall be repaired by Landlord, to the extent not covered by insurance,
at Tenant’s sole cost and expense. Landlord reserves the right to stop Building
Systems services when reasonably necessary (i) by reason of accident or
emergency, or (ii) for planned repairs, alterations or improvements, which are,
in the reasonable judgment of Landlord, desirable or necessary to be made, until
said repairs, alterations or improvements shall have been completed. Landlord
shall have no responsibility or liability for failure to supply Building Systems
services during any such period of interruption; provided, however, that
Landlord shall, except in case of emergency, make a commercially reasonable
effort to give Tenant 24 hours advance notice of any planned stoppage of
Building Systems services for routine maintenance, repairs, alterations or
improvements. Tenant shall promptly give Landlord written notice of any repair
required by Landlord pursuant to this Section, after which Landlord shall make a
commercially reasonable effort to effect such repair. Landlord shall use
reasonable efforts to minimize interference with Tenant’s operations in the
Premises during the performance of Landlord’s repair and maintenance obligations
under this Lease. Landlord shall not be liable for any failure to make any
repairs or to perform any maintenance unless such failure shall persist for an
unreasonable time after Tenant’s written notice of the need for such repairs or
maintenance. Tenant waives its rights under any state or local law to terminate
this Lease or to make such repairs at Landlord’s expense and agrees that the
parties’ respective rights with respect to such matters shall be solely as set
forth herein. Repairs required as the result of fire, earthquake, flood,
vandalism, war, or similar cause of damage or destruction shall be controlled by
Section 18.

 

14. Tenant’s Repairs. Subject to Section 13 hereof, Tenant, at its expense,
shall repair, replace and maintain in good condition (subject to normal wear and
tear, casualty and condemnation) all portions of the Premises, including,
without limitation, entries, doors, ceilings, interior windows, interior walls,
and the interior side of demising walls. Should Tenant fail to make any such
repair or replacement or fail to maintain the Premises, Landlord shall give
Tenant notice of such failure. If Tenant fails to commence cure of such failure
within 30 days of Landlord’s notice, and thereafter diligently prosecute such
cure to completion, Landlord may perform such work and shall be reimbursed by
Tenant for the actual costs incurred by Landlord with respect thereto within 30
days after Tenant’s receipt of a reasonably detailed invoice; provided, however,
that if such failure by Tenant creates or could create an emergency, Landlord
may immediately commence cure of such failure and shall thereafter be entitled
to recover the actual costs of such cure from Tenant within 30 days after
written demand therefor. Subject to Sections 17 and 18, Tenant shall bear the
full uninsured cost of any repair or replacement to any part of the Project that
results from damage caused by Tenant or any Tenant Party. Landlord shall use
reasonable efforts to minimize interference with Tenant’s operations in the
Premises during the performance of repair and maintenance of the Premises
pursuant to this Section 14. Notwithstanding anything to the contrary contained
herein, Tenant shall not be required to perform or construct any capital repairs
or replacements, but Tenant shall be required to pay for capital repairs and
replacements performed or constructed by Landlord in accordance with the other
provisions of this Lease.

 

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Notwithstanding anything to the contrary contained in this Lease, as of the
Commencement Date, the maintenance and repair obligations for the Premises shall
be allocated between Landlord and Tenant as set forth on Exhibit G attached
hereto. The maintenance obligations allocated to Tenant pursuant to Exhibit G
(the “Tenant Maintenance Obligations”) shall be performed by Tenant at Tenant’s
sole cost and expense. The Tenant Maintenance Obligations shall include the
procurement and maintenance of contracts, in form and substance reasonably
satisfactory to Landlord, with copies to Landlord upon Landlord’s written
request, for and with contractors reasonably acceptable to Landlord specializing
and experienced in the respective Tenant Maintenance Obligations.
Notwithstanding anything to the contrary contained herein, the scope of work of
any such contracts entered into by Tenant pursuant to this paragraph shall, at a
minimum, comply with manufacturer’s recommended maintenance procedures for the
optimal performance of the applicable equipment. Landlord shall, notwithstanding
anything to the contrary contained in this Lease, have no obligation to perform
any Tenant Maintenance Obligations. The Tenant Maintenance Obligations shall not
include the right or obligation on the part of Tenant to make any structural
and/or capital repairs or improvements to the Project, and Landlord shall,
during any period that Tenant is responsible for the Tenant Maintenance
Obligations, continue, as part of Operating Expenses, to be responsible, as
provided in the immediately preceding paragraph, for capital repairs and
replacements required to be made to the Project. If Tenant fails to maintain any
portion of the Premises for which Tenant is responsible as part of the Tenant
Maintenance Obligations in a manner reasonably acceptable to Landlord within the
requirements of this Lease, Landlord shall have the right, but not the
obligation, to provide Tenant with written notice thereof and to assume the
Tenant Maintenance Obligations if Tenant does not cure Tenant’s failure within
10 days after receipt of such notice.

 

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

 

16. Indemnification. Tenant hereby indemnifies and agrees to defend, save and
hold Landlord, its officers, directors, employees, managers, agents, sub-agents,
constituent entities and lease signators (collectively, “Landlord Indemnified
Parties”) harmless from and against any and all Claims for injury or death to
persons or damage to property occurring within or about the Premises or the
Project arising directly or indirectly out of use or occupancy of the Premises
or the Project by Tenant or any Tenant Parties (including, without limitation,
any act, omission or neglect by Tenant or any Tenant’s Parties in or about the
Premises or at the Project) or \a breach or default by Tenant in the performance
of any of its obligations hereunder, except to the extent caused by the willful
misconduct or gross negligence of Landlord Indemnified Parties. Landlord shall
not be liable to Tenant for, and Tenant assumes all risk of damage to, personal
property (including, without limitation, loss of records kept within the
Premises). Tenant further waives any and all Claims for injury to Tenant’s
business or loss of income relating to any such damage or destruction of
personal property (including, without limitation, any loss of records). Landlord
Indemnified Parties shall not be liable for any damages arising from any act,
omission or neglect of any tenant in the Project or of any other third party or
Tenant Parties.

 

17. Insurance. Landlord shall maintain all risk property and, if applicable,
sprinkler damage insurance covering the full replacement cost of the Project.
Landlord shall further procure and maintain commercial general liability
insurance with a single loss limit of not less than $2,000,000 for bodily injury
and property damage with respect to the Project. Landlord may, but is not
obligated to, maintain such other insurance and additional coverages as it may
deem reasonably necessary, including, but not limited to, flood, environmental
hazard and earthquake, loss or failure of building equipment, errors and
omissions, rental loss during the period of repair or rebuilding, workers’
compensation insurance and fidelity bonds for employees employed to perform
services and insurance for any improvements installed by Tenant or which are in
addition to the standard improvements customarily furnished by Landlord without
regard to whether or not such are made a part of the Project. All such insurance
shall be included as part of the Operating Expenses (except to the extent the
cost thereof is expressly excluded from Operating Expenses pursuant to Section 5
hereof). The Project may be included in a blanket policy (in which case the cost
of such insurance allocable to the Project will be reasonably determined by
Landlord based upon the insurer’s cost calculations). Tenant shall also
reimburse Landlord for any actual increased premiums or additional insurance
which Landlord reasonably deems necessary as a result of Tenant’s particular use
of the Premises.

 

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Tenant, at its sole cost and expense, shall maintain during the Term: all risk
property insurance with business interruption and extra expense coverage,
covering the full replacement cost of all property and Alterations installed or
placed in the Premises by Tenant at Tenant’s expense; workers’ compensation
insurance with no less than the minimum limits required by law; employer’s
liability insurance with employers liability limits of $1,000,000 bodily injury
by accident – each accident, $1,000,000 bodily injury by disease – policy limit,
and $1,000,000 bodily injury by disease – each employee; and commercial general
liability insurance, with a minimum limit of not less than $2,000,000 per
occurrence for bodily injury and property damage with respect to the Premises.
The commercial general liability insurance maintained by Tenant shall name
Alexandria Real Estate Equities, Inc., and Landlord, its officers, directors,
employees, managers, agents, sub-agents, constituent entities and lease
signators (collectively, “Landlord Insured Parties”), as additional insureds;
insure on an occurrence and not a claims-made basis; be issued by insurance
companies which have a rating of not less than policyholder rating of A and
financial category rating of at least Class X in “Best’s Insurance Guide”; not
contain a hostile fire exclusion; contain a contractual liability endorsement;
and provide primary coverage to Landlord Insured Parties (any policy issued to
Landlord Insured Parties providing duplicate or similar coverage shall be deemed
excess over Tenant’s policies, regardless of limits). Tenant shall (i) provide
Landlord with 30 days’ advance written notice to Landlord of cancellation of
such commercial general liability policy, and (ii) request that its insurer
endeavor to provide 10 days’ advance written notice to Landlord of cancellation
of such commercial general liability policy. Certificates of insurance showing
the limits of coverage required hereunder and showing Landlord as an additional
insured, along with reasonable evidence of the payment of premiums for the
applicable period, shall be delivered to Landlord by Tenant prior to (i) the
earlier to occur of (x) the Commencement Date, or (y) the date that Tenant
accesses the Premises under this Lease, and (ii) each renewal of said insurance.
Tenant’s policy may be a “blanket policy” with an aggregate per location
endorsement which specifically provides that the amount of insurance shall not
be prejudiced by other losses covered by the policy. Tenant shall, at least 5
days prior to the expiration of such policies, furnish Landlord with renewal
certificates.

 

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

 

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

 

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Landlord may require insurance policy limits to be raised to conform with
requirements of Landlord’s lender and/or to bring coverage limits to levels then
being generally required of new tenants within the Project; provided, however,
that the increased amount of coverage is consistent with coverage amounts then
being required by institutional owners of similar projects with tenants
occupying similar size premises in the geographical area in which the Project is
located.

 

18. Restoration. If, at any time during the Term, the Project or the Premises
are damaged or destroyed by a fire or other insured casualty, Landlord shall
notify Tenant within 60 days after discovery of such damage as to the amount of
time Landlord reasonably estimates it will take to restore the Project or the
Premises, as applicable (the “Restoration Period”). If the Restoration Period is
estimated to exceed 9 months (the “Maximum Restoration Period”), Landlord may,
in such notice, elect to terminate this Lease as of the date that is 75 days
after the date of discovery of such damage or destruction; provided, however,
that notwithstanding Landlord’s election to restore, Tenant may elect to
terminate this Lease by written notice to Landlord delivered within 20 business
days of receipt of a notice from Landlord estimating a Restoration Period for
the Premises longer than the Maximum Restoration Period. Unless either Landlord
or Tenant so elects to terminate this Lease, Landlord shall, subject to receipt
of sufficient insurance proceeds (with any deductible to be treated as a current
Operating Expense), promptly restore the Premises (excluding the Alterations or
other improvements installed by Tenant or by Landlord and paid for by Tenant),
subject to delays arising from the collection of insurance proceeds, from Force
Majeure events or as needed to obtain any license, clearance or other
authorization of any kind required to enter into and restore the Premises issued
by any Governmental Authority having jurisdiction over the use, storage,
handling, treatment, generation, release, disposal, removal or remediation of
Hazardous Materials (as defined in Section 30) in, on or about the Premises
(collectively referred to herein as “Hazardous Materials Clearances”); provided,
however, that if repair or restoration of the Premises is not substantially
complete as of the end of the Maximum Restoration Period or, if longer, the
Restoration Period, Landlord may, in its sole and absolute discretion, elect by
delivery of written notice to Tenant any time after the expiration of the
Maximum Restoration Period or, if longer, the Restoration Period, not to proceed
with such repair and restoration or Tenant may by written notice to Landlord
delivered within 10 business days of the expiration of the Maximum Restoration
Period or, if longer, the Restoration Period, elect to terminate this Lease, in
which event Landlord shall be relieved of its obligation to make such repairs or
restoration and this Lease shall terminate as of the date that is 75 days after
the later of: (i) discovery of such damage or destruction, or (ii) the date all
required Hazardous Materials Clearances are obtained, but Landlord shall retain
any Rent paid and the right to any Rent payable by Tenant prior to such election
by Landlord or Tenant.

 

Tenant, at its expense, shall promptly perform, subject to delays arising from
the collection of insurance proceeds, from Force Majeure (as defined in Section
34) events or to obtain Hazardous Material Clearances, all repairs or
restoration not required to be done by Landlord. Notwithstanding the foregoing,
either Landlord or Tenant may terminate this Lease upon written notice to the
other if the Premises are damaged during the last year of the Term and Landlord
reasonably estimates that it will take more than 2 months to repair such damage;
provided, however, that such notice is delivered within 10 business days after
the date that Landlord provides Tenant with written notice of the estimated
Restoration Period. Notwithstanding anything to the contrary contained herein,
Landlord shall also have the right to terminate this Lease if sufficient
insurance proceeds are not available for such restoration (for any reason other
than Landlord’s failure to maintain the insurance required to be maintained by
Landlord pursuant to Section 17). Rent shall be abated from the date all
required Hazardous Material Clearances are obtained until the Premises are
repaired and restored, in the proportion which the area of the Premises, if any,
which is not usable by Tenant bears to the total area of the Premises, unless
Landlord provides Tenant with other space during the period of repair that is
suitable, in Tenant’s reasonable discretion, for the temporary conduct of
Tenant’s business. In the event that no Hazardous Material Clearances are
required to be obtained by Tenant with respect to the Premises, rent abatement
shall commence on the date of discovery of the damage or destruction. Such
abatement shall be the sole remedy of Tenant, and except as provided in this
Section 18, Tenant waives any right to terminate the Lease by reason of damage
or casualty loss.

 

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

 

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

 

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

 

(a) Payment Defaults. Tenant shall fail to pay any installment of Rent or any
other payment hereunder when due; provided, however, that Landlord will give
Tenant notice and an opportunity to cure any failure to pay Rent within 5 days
of Tenant’s receipt of any such notice not more than once in any 12 month period
and Tenant agrees that such notice shall be in lieu of and not in addition to,
or shall be deemed to be, any notice required by law.

 

(b) Insurance. Any insurance required to be maintained by Tenant pursuant to
this Lease shall be canceled or terminated or shall expire or shall be reduced
or materially changed, or Landlord or Tenant shall receive a notice of
nonrenewal of any such insurance and Tenant shall fail to obtain replacement
insurance at least 5 days before the expiration of the current coverage.

 

(c) Abandonment. Tenant shall abandon the Premises. Tenant shall not be deemed
to have abandoned the Premises if Tenant provides Landlord with reasonable
advance notice prior to vacating and, at the time of vacating the Premises, (i)
Tenant completes Tenant’s obligations under the Decommissioning and HazMat
Closure Plan in compliance with Section 28, (ii) Tenant has obtained the release
of the Premises of all Hazardous Materials Clearances and the Premises are free
from any residual impact from the Tenant HazMat Operations and provides
reasonably detailed documentation to Landlord confirming such matters, (iii)
Tenant has made reasonable arrangements with Landlord for the security of the
Premises for the balance of the Term, and (iv) Tenant continues during the
balance of the Term to satisfy and perform all of Tenant’s obligations under
this Lease as they come due.

 

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

 

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

 

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

 

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

 

(h) Other Defaults. Tenant shall fail to comply with any provision of this Lease
other than those specifically referred to in this Section 20, and, except as
otherwise expressly provided herein, such failure shall continue for a period of
30 days after written notice thereof from Landlord to Tenant.

 

Any notice given under Section 20(h) hereof shall: (i) specify the alleged
default, (ii) demand that Tenant cure such default, (iii) be in lieu of, and not
in addition to, or shall be deemed to be, any notice required under any
provision of applicable law, and (iv) not be deemed a forfeiture or a
termination of this Lease unless Landlord elects otherwise in such notice;
provided that if the nature of Tenant’s default pursuant to Section 20(h) is
such that it cannot be cured by the payment of money and reasonably requires
more than 30 days to cure, then Tenant shall not be deemed to be in default if
Tenant commences such cure within said 30 day period and thereafter diligently
prosecutes the same to completion; provided, however, that such cure shall be
completed no later than 60 days from the date of Landlord’s notice.

 

21. Landlord’s Remedies.

 

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

 

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

 

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

 

(i) Terminate this Lease, or at Landlord’s option, and to the extent permitted
by applicable Legal Requirements, Tenant’s right to possession only upon no less
than 5 days’ advance written notice to Tenant, in which event Tenant shall
immediately surrender the Premises to Landlord, and if Tenant fails to do so,
Landlord may, without prejudice to any other remedy which it may have for
possession or arrearages in rent, enter upon and take possession of the Premises
and expel or remove Tenant and any other person who may be occupying the
Premises or any part thereof, without being liable for prosecution or any claim
or damages therefor;

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

22. Assignment and Subletting.

 

(a) General Prohibition. Without Landlord’s prior written consent subject to and
on the conditions described in this Section 22, Tenant shall not, directly or
indirectly, voluntarily or by operation of law, assign this Lease or sublease
the Premises or any part thereof or mortgage, pledge, or hypothecate its
leasehold interest or grant any concession or license within the Premises, and
any attempt to do any of the foregoing shall be void and of no effect. If Tenant
is a corporation, partnership or limited liability company, the shares or other
ownership interests thereof which are not actively traded upon a stock exchange
or in the over-the-counter market, a transfer or series of transfers whereby 50%
or more of the issued and outstanding shares or other ownership interests of
such entity are, or voting control is, transferred (but excepting transfers upon
deaths of individual owners) from a person or persons or entity or entities
which were owners thereof at time of execution of this Lease to persons or
entities who were not owners of shares or other ownership interests of the
corporation, partnership or limited liability company at time of execution of
this Lease, shall be deemed an assignment of this Lease requiring the consent of
Landlord as provided in this Section 22.

 

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(b) Permitted Transfers. If Tenant desires to assign, sublease, hypothecate or
otherwise transfer this Lease or sublet the Premises other than pursuant to a
Permitted Assignment (as defined below), then at least 15 business days, but not
more than 45 business days, before the date Tenant desires the assignment or
sublease to be effective (the “Assignment Date”), Tenant shall give Landlord a
notice (the “Assignment Notice”) containing such information about the proposed
assignee or sublessee, including the proposed use of the Premises and any
Hazardous Materials proposed to be used, stored handled, treated, generated in
or released or disposed of from the Premises, the Assignment Date, any
relationship between Tenant and the proposed assignee or sublessee, and all
material terms and conditions of the proposed assignment or sublease, including
a copy of any proposed assignment or sublease in its final form, and such other
information as Landlord may deem reasonably necessary or appropriate to its
consideration whether to grant its consent. Landlord may, by giving written
notice to Tenant within 15 business days after receipt of the Assignment Notice:
(i) grant such consent, or (ii) refuse such consent, in its reasonable
discretion. Among other reasons, it shall be reasonable for Landlord to withhold
its consent in any of these instances: (1) the proposed assignee or subtenant is
a governmental agency; (2) in Landlord’s reasonable judgment, the use of the
Premises by the proposed assignee or subtenant would entail any alterations that
would materially lessen the value of the leasehold improvements in the Premises,
or would require materially increased services by Landlord; (3) in Landlord’s
reasonable judgment, the proposed assignee or subtenant is engaged in areas of
scientific research or other business concerns that are controversial such that
they may (i) attract or cause negative publicity for or about the Building or
the Project, (ii) negatively affect the reputation of the Building, the Project
or Landlord, (iii) attract protestors to the Building or the Project, or (iv)
lessen the attractiveness of the Building or the Project to any tenants or
prospective tenants, purchasers or lenders; (4) in Landlord’s reasonable
judgment, the proposed assignee or subtenant lacks the creditworthiness to
support the financial obligations it will incur under the proposed assignment or
sublease; (5) in Landlord’s reasonable judgment, the character, reputation, or
business of the proposed assignee or subtenant is inconsistent with the desired
tenant-mix or the quality of other tenancies in the Project or is inconsistent
with the type and quality of the nature of the Building; (6) Landlord has
received from any prior landlord to the proposed assignee or subtenant a
negative report concerning such prior landlord’s experience with the proposed
assignee or subtenant; (7) Landlord has experienced previous defaults by or is
in litigation with the proposed assignee or subtenant; (8) the use of the
Premises by the proposed assignee or subtenant will violate any applicable Legal
Requirement; (9) the proposed assignee or subtenant is an entity with whom
Landlord is then negotiating to lease comparable space in the Project; or (10)
the assignment or sublease is prohibited by Landlord’s lender. No failure of
Landlord to deliver a timely notice in response to the Assignment Notice, shall
be deemed to be Landlord’s consent to the proposed assignment, sublease or other
transfer. Tenant shall pay to Landlord a fee equal to Two Thousand Five Hundred
Dollars ($2,500) in connection with its consideration of any Assignment Notice
and/or its preparation or review of any consent documents. Notwithstanding the
foregoing, Landlord’s consent to an assignment of this Lease or a subletting of
any portion of the Premises to any entity controlling, controlled by or under
common control with Tenant (a “Control Permitted Assignment”) shall not be
required, provided that Landlord shall have the right to approve the form of any
such sublease or assignment (which approval shall not be unreasonably withheld
or delayed). In addition, Tenant shall have the right to assign this Lease, upon
30 days prior written notice to Landlord ((x) unless Tenant is prohibited from
providing such notice by applicable Legal Requirements in which case Tenant
shall notify Landlord promptly thereafter, and (y) if the transaction is subject
to confidentiality requirements, Tenant’s advance notification shall be subject
to Landlord’s execution of a non-disclosure agreement reasonably acceptable to
Landlord and Tenant) but without obtaining Landlord’s prior written consent, to
a corporation or other entity which is a successor-in-interest to Tenant, by way
of merger, consolidation or corporate reorganization, or by the purchase of all
or substantially all of the assets or the ownership interests of Tenant provided
that (i) such merger or consolidation, or such acquisition or assumption, as the
case may be, is for a good business purpose and not principally for the purpose
of transferring the Lease, and (ii) the net worth (as determined in accordance
with generally accepted accounting principles (“GAAP”)) of the assignee is not
less than the greater of the net worth (as determined in accordance with GAAP)
of Tenant as of (A) the Commencement Date, or (B) as of the date of Tenant’s
most current quarterly or annual financial statements, and (iii) such assignee
shall agree in writing to assume all of the terms, covenants and conditions of
this Lease (a “Corporate Permitted Assignment”) Control Permitted Assignments
and Corporate Permitted Assignments are hereinafter referred to as “Permitted
Assignments.

 

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

 

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

 

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

 

(d) No Release of Tenant, Sharing of Excess Rents. Notwithstanding any
assignment or subletting, Tenant and any guarantor or surety of Tenant’s
obligations under this Lease shall at all times remain fully and primarily
responsible and liable for the payment of Rent and for compliance with all of
Tenant’s other obligations under this Lease. Other than in connection with a
Permitted Assignment, if the Rent due and payable by a sublessee or assignee (or
a combination of the rental payable under such sublease or assignment plus any
bonus or other consideration therefor or incident thereto in any form) exceeds
the sum of the Rent payable under this Lease, and actual and reasonable
brokerage fees, legal costs and any design or construction fees directly related
to and required pursuant to the terms of any such sublease) (“Excess Rent”),
then Tenant shall be bound and obligated to pay Landlord as Additional Rent
hereunder 50% of such Excess Rent within 30 days following receipt thereof by
Tenant. If Tenant shall sublet the Premises or any part thereof, Tenant hereby
immediately and irrevocably assigns to Landlord, as security for Tenant’s
obligations under this Lease, all rent from any such subletting, and Landlord as
assignee, or a receiver for Tenant appointed on Landlord’s application, may
collect such rent and apply it toward Tenant’s obligations under this Lease;
except that, until the occurrence of a Default, Tenant shall have the right to
collect such rent.

 

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

 

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

 

23. Estoppel Certificate. Tenant shall, within 15 business days of written
notice from Landlord, execute, acknowledge and deliver a statement in writing in
any form reasonably requested by a proposed lender or purchaser, (i) certifying
that this Lease is unmodified and in full force and effect (or, if modified,
stating the nature of such modification and certifying that this Lease as so
modified is in full force and effect) and the dates to which the rental and
other charges are paid in advance, if any, (ii) acknowledging, to Tenant’s
knowledge, that there are not any uncured defaults on the part of Landlord
hereunder, or specifying such defaults if any are claimed, and (iii) setting
forth such further information with respect to the status of this Lease or the
Premises as may be reasonably requested thereon. Any such statement may be
relied upon by any prospective purchaser or encumbrancer of all or any portion
of the real property of which the Premises are a part. Tenant’s failure to
deliver such statement within 5 days after Tenant’s receipt of a second notice
from Landlord requesting such statement after the expiration of the
aforementioned 15 business day period shall, at the option of Landlord,
constitute a Default under this Lease, and, in any event, shall be conclusive
upon Tenant that the Lease is in full force and effect and without modification
except as may be represented by Landlord in any certificate prepared by Landlord
and delivered to Tenant for execution.

 

24. Quiet Enjoyment. So long as Tenant is not in Default under this Lease,
Tenant shall, subject to the terms of this Lease, at all times during the Term,
have peaceful and quiet enjoyment of the Premises against any person claiming
by, through or under Landlord.

 

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

 

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

 

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

 

28. Surrender. Upon the expiration of the Term or earlier termination of
Tenant’s right of possession, Tenant shall surrender the Premises to Landlord in
the same condition as received, subject to any Alterations or Installations
permitted by Landlord to remain in the Premises, free of Hazardous Materials
brought upon, kept, used, stored, handled, treated, generated in, or released or
disposed of from, the Premises by any person other than a Landlord Party
(collectively, “Tenant HazMat Operations”) and released of all Hazardous
Materials Clearances, broom clean, ordinary wear and tear and casualty loss and
condemnation covered by Sections 18 and 19 excepted. At least 3 months prior to
the surrender of the Premises or such earlier date as Tenant may elect to cease
operations at the Premises, Tenant shall deliver to Landlord a narrative
description of the actions proposed (or required by any Governmental Authority)
to be taken by Tenant in order to surrender the Premises (including any
Installations and/or Alterations permitted by Landlord to remain in the
Premises) at the expiration or earlier termination of the Term, free from any
residual impact from the Tenant HazMat Operations and otherwise released for
unrestricted use and occupancy (the “Decommissioning and HazMat Closure Plan”).
Such Decommissioning and HazMat Closure Plan shall be accompanied by a current
listing of (i) all Hazardous Materials licenses and permits held by or on behalf
of any Tenant Party with respect to the Premises, and (ii) all Hazardous
Materials used, stored, handled, treated, generated, released or disposed of
from the Premises, and shall be subject to the review and approval of Landlord’s
environmental consultant, which approval shall not be unreasonably withheld. In
connection with the review and approval of the Decommissioning and HazMat
Closure Plan, upon the request of Landlord, Tenant shall deliver to Landlord or
its consultant such additional non-proprietary information concerning Tenant
HazMat Operations as Landlord shall reasonably request. On or before such
surrender, Tenant shall deliver to Landlord evidence that the approved
Decommissioning and HazMat Closure Plan shall have been satisfactorily completed
and Landlord shall have the right, subject to reimbursement at Tenant’s expense
as set forth below, to cause Landlord’s environmental consultant to inspect the
Premises and perform such additional procedures as may be deemed reasonably
necessary to confirm that the Premises are, as of the effective date of such
surrender or early termination of the Lease, free from any residual impact from
Tenant HazMat Operations. Tenant shall reimburse Landlord, as Additional Rent,
for the reasonable actual out-of-pocket expense incurred by Landlord for
Landlord’s environmental consultant to review and approve the Decommissioning
and HazMat Closure Plan and to visit the Premises and verify satisfactory
completion of the same, which cost shall not exceed $5,000. Landlord shall have
the unrestricted right to deliver such Decommissioning and HazMat Closure Plan
and any report by Landlord’s environmental consultant with respect to the
surrender of the Premises to third parties.

 

If Tenant shall fail to prepare or submit a Decommissioning and HazMat Closure
Plan approved by Landlord, or if Tenant shall fail to complete the approved
Decommissioning and HazMat Closure Plan, or if such Decommissioning and HazMat
Closure Plan, whether or not approved by Landlord, shall fail to adequately
address any residual effect of Tenant HazMat Operations in, on or about the
Premises, Landlord shall have the right to take such actions as Landlord may
deem reasonable or appropriate to assure that the Premises and the Project are
surrendered free from any residual impact from Tenant HazMat Operations, the
cost of which actions shall be reimbursed by Tenant as Additional Rent within 30
days following Tenant’s receipt of a reasonably documented invoice therefor,
without regard to the limitation set forth in the first paragraph of this
Section 28.

 

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

 

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

 

30. Environmental Requirements.

 

(a) Prohibition/Compliance/Indemnity. Tenant shall not cause or permit any
Hazardous Materials (as hereinafter defined) to be brought upon, kept, used,
stored, handled, treated, generated in or about, or released or disposed of
from, the Premises or the Project in violation of applicable Environmental
Requirements (as hereinafter defined) by Tenant or any Tenant Party. If Tenant
breaches the obligation stated in the preceding sentence, or if the presence of
Hazardous Materials in the Premises during Tenant’s occupancy of the Premises or
any holding over results in contamination of the Premises, the Project or any
adjacent property or if contamination of the Premises, the Project or any
adjacent property by Hazardous Materials brought into, kept, used, stored,
handled, treated, generated in or about, or released or disposed of from, the
Premises by anyone other than Landlord and Landlord’s employees, agents and
contractors otherwise occurs during Tenant’s occupancy of the Premises or any
holding over, Tenant hereby indemnifies and shall defend and hold Landlord, its
officers, directors, employees, agents and contractors harmless from any and all
actions (including, without limitation, remedial or enforcement actions of any
kind, administrative or judicial proceedings, and orders or judgments arising
out of or resulting therefrom), costs, claims, damages (including, without
limitation, punitive damages and damages based upon diminution in value of the
Premises or the Project, or the loss of, or restriction on, use of the Premises
or any portion of the Project), expenses (including, without limitation,
attorneys’, consultants’ and experts’ fees, court costs and amounts paid in
settlement of any claims or actions), fines, forfeitures or other civil,
administrative or criminal penalties, injunctive or other relief (whether or not
based upon personal injury, property damage, or contamination of, or adverse
effects upon, the environment, water tables or natural resources), liabilities
or losses (collectively, “Environmental Claims”) which arise during or after the
Term as a result of such contamination. This indemnification of Landlord by
Tenant includes, without limitation, costs incurred in connection with any
investigation of site conditions or any cleanup, treatment, remedial, removal,
or restoration work required by any federal, state or local Governmental
Authority because of Hazardous Materials present in the air, soil or ground
water above, on, or under the Premises. Without limiting the foregoing, if the
presence of any Hazardous Materials on the Premises, the Building, the Project
or any adjacent property caused or permitted by Tenant or any Tenant Party
results in any contamination of the Premises, the Building, the Project or any
adjacent property, Tenant shall promptly take all actions at its sole expense
and in accordance with applicable Environmental Requirements as are necessary to
return the Premises, the Building, the Project or any adjacent property to the
condition existing prior to the time of such contamination, provided that
Landlord’s approval of such action shall first be obtained, which approval shall
not unreasonably be withheld so long as such actions would not potentially have
any material adverse long-term or short-term effect on the Premises, the
Building or the Project. Notwithstanding anything to the contrary contained in
Section 28 or this Section 30, Tenant shall not be responsible for, and the
indemnification and hold harmless obligation set forth in this paragraph shall
not apply to (i) contamination in the Premises which Tenant can prove existed in
the Premises immediately prior to the Commencement Date, (ii) the presence of
any Hazardous Materials in the Premises which Tenant can prove migrated from
outside of the Premises into the Premises, or (iii) the presence of any
Hazardous Materials in the Premises caused by Landlord or any Landlord’s
employees, agents and contractors, unless in any case, the presence of such
Hazardous Materials (x) is the result of a breach by Tenant of any of its
obligations under this Lease, or (y) was caused, contributed to or exacerbated
by Tenant or any Tenant Party.

 

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

 

(c) Tenant Representation and Warranty. Tenant hereby represents and warrants to
Landlord that (i) neither Tenant nor, to Tenant’s actual knowledge, any of its
legal predecessors has been required by any prior landlord, lender or
Governmental Authority at any time to take remedial action in connection with
Hazardous Materials contaminating a property which contamination was permitted
by Tenant of such predecessor or resulted from Tenant’s or such predecessor’s
action or use of the property in question, and (ii) Tenant is not subject to any
enforcement order issued by any Governmental Authority in connection with the
use, storage, handling, treatment, generation, release or disposal of Hazardous
Materials (including, without limitation, any order related to the failure to
make a required reporting to any Governmental Authority).

 

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

 

(e) Control Areas. Tenant shall have the use of 100% of the control area
designated as control area 1.2 on Exhibit H attached hereto. For the avoidance
of doubt, Tenant shall not have rights with respect to any other control areas
at the Project.

 

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

 

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

 

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

 

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

 

 Notwithstanding the foregoing, if any claimed Landlord default hereunder will
immediately, materially and adversely affect Tenant’s ability to conduct its
business in the Premises (a “Material Landlord Default”), Tenant shall, as soon
as reasonably possible, but in any event within 5 business days of obtaining
knowledge of such claimed Material Landlord Default, give Landlord written
notice of such claim, which notice shall specifically state that a Material
Landlord Default exists and telephonic notice to Tenant’s principal contact with
Landlord. Landlord shall then have 2 business days to commence cure of such
claimed Material Landlord Default and shall diligently prosecute such cure to
completion. If Landlord fails to commence cure of any claimed Material Landlord
Default as provided above, Tenant may commence and prosecute such cure to
completion provided that it does not impact or adversely affect any other
tenants at the Project, the Building structure or Common Areas, and shall be
entitled to recover the costs of such cure (but not any consequential or other
damages) from Landlord by way of reimbursement from Landlord with no right to
offset against Rent, to the extent of Landlord’s obligation to cure such claimed
Material Landlord Default hereunder, subject to the limitations set forth in the
immediately following sentence of this paragraph and the other provisions of
this Lease. If such claimed Material Landlord Default is not a default by
Landlord hereunder, or if Tenant failed to give Landlord the notice required
hereunder prior to commencing Tenant’s cure of any alleged Material Landlord
Default, Landlord shall be entitled to recover from Tenant, as Additional Rent,
any costs incurred by Landlord in connection with such cure in excess of the
costs, if any, that Landlord would otherwise have been liable to pay hereunder.

 

All obligations of Landlord under this Lease will be binding upon Landlord only
during the period of its ownership of the Premises and not thereafter, provided
that any person or entity succeeding to the interest of Landlord assumes in
writing all of the obligations of Landlord under this Lease arising during such
person’s or entity’s period of ownership of the Premises. The term “Landlord” in
this Lease shall mean only the owner for the time being of the Premises. Upon
the transfer by such owner of its interest in the Premises, such owner shall
thereupon be released and discharged from all obligations of Landlord thereafter
accruing, but such obligations shall be binding during the Term upon each new
owner for the duration of such owner’s ownership.

 

32. Inspection and Access. Landlord and Landlord’s representatives may enter the
Premises during business hours on not less than 48 hours advance written notice
(except in the case of emergencies in which case no such notice shall be
required and such entry may be at any time) for the purpose of effecting any
such repairs as may be required or permitted pursuant to this Lease, inspecting
the Premises, showing the Premises to prospective purchasers and, during the
last year of the Term, to prospective tenants or for any other business purpose.
Landlord shall use reasonable efforts to minimize interference with Tenant’s
operations in the Premises in connection with Landlord’s activities conducted
pursuant to this paragraph. Landlord may erect a suitable sign on the Premises
stating the Premises are available to let or that the Project is available for
sale. Landlord may grant easements, make public dedications, designate Common
Areas and create restrictions on or about the Premises, provided that no such
easement, dedication, designation or restriction materially, adversely affects
Tenant’s use or occupancy of the Premises for the Permitted Use (including
Tenant’s access to and use of the parking spaces which Tenant is entitled to use
pursuant to Section 10). At Landlord’s written request, Tenant shall execute
such instruments as may be necessary for such easements, dedications or
restrictions, provided that such instruments do not materially increase Tenant’s
obligations or materially decrease Tenant’s rights under this Lease. Tenant
shall at all times, except in the case of emergencies, have the right to escort
Landlord or its agents, representatives, contractors or guests while the same
are in the Premises, provided such escort does not materially and adversely
affect Landlord’s access rights hereunder. Landlord shall comply with Tenant’s
reasonable security and safety requirements with respect to entering the
Premises; provided, however, that Tenant has notified Landlord of such security
and safety requirements simultaneously with or prior to Landlord’s entry into
the Premises.

 

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 Tenant agrees that Landlord may from time to time during the Term, conduct
third party tours of the Premises (“Tours”) which may be held with less than 24
hours advance notice; provided, however, that Tenant shall have the right to
delay any Tours for which it receives notice from Landlord for up to 24 hours if
Tenant plans to conduct proprietary meetings at the Premises during the time of
such Tours and Tenant delivers written notice to Landlord of such proprietary
meetings within 8 hours of receiving Landlord’s notice of such Tours. Landlord
shall endeavor to minimize disruption to Tenant’s operations in the Premises
during such Tours.

 

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

 

34. Force Majeure. Except for the payment of Rent, neither Landlord nor Tenant
shall be held responsible or liable for delays in the performance of its
obligations hereunder when caused by, related to, or arising out of acts of God,
sinkholes or subsidence, strikes, lockouts, or other labor disputes, embargoes,
quarantines, extreme weather, national, regional, or local disasters,
calamities, or catastrophes, inability to obtain labor or materials (or
reasonable substitutes therefor) at reasonable costs or failure of, or inability
to obtain, utilities necessary for performance, governmental restrictions,
orders, limitations, regulations, or controls, national emergencies, delay in
issuance or revocation of permits, enemy or hostile governmental action,
terrorism, insurrection, riots, civil disturbance or commotion, fire or other
casualty, and other causes or events beyond their reasonable control (“Force
Majeure”).

 

35. Brokers. Landlord and Tenant each represents and warrants that it has not
dealt with any broker, agent or other person (collectively, “Broker”) in
connection with this transaction and that no Broker brought about this
transaction, other than Hughes Marino, Cushman & Wakefield and CBRE. Landlord
and Tenant each hereby agree to indemnify and hold the other harmless from and
against any claims by any Broker, other than Hughes Marino, Cushman & Wakefield
and CBRE, claiming a commission or other form of compensation by virtue of
having dealt with Tenant or Landlord, as applicable, with regard to this leasing
transaction. Landlord shall be responsible for all fees of Hughes Marino,
Cushman & Wakefield and CBRE arising out of the execution of this Lease in
accordance with the terms of separate written agreements between Landlord, on
the one hand, and Hughes Marino, Cushman & Wakefield and CBRE, respectively, on
the other hand.

 

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

 

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

 

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

 

Tenant shall have the non-exclusive right to display, 1 sign bearing Tenant’s
name and logo on the monument sign serving the Project in the location and
pursuant to the specifications designated on Exhibit J (“Monument Sign”). Tenant
acknowledges and agrees that the Tenant’s Monument Sign, including, without
limitation, the location, size, color and type, shall be subject to Landlord’s
prior written approval, which shall not be unreasonably withheld, and shall be
subject to and in compliance with applicable Legal Requirements and Landlord’s
Project standards. The design, fabrication and installation of the Tenant’s
Monument Sign shall be paid for by Landlord. Tenant shall be responsible, at
Tenant’s sole cost and expense, for the maintenance of Tenant’s Monument Sign,
the removal of the Tenant’s Monument Sign at the expiration or earlier
termination of the Term and for the repair of all damage resulting from such
removal.

 

39. Right to Extend Term. Tenant shall have the right to extend the Term of the
Lease upon the following terms and conditions:

 

(a) Extension Rights. Tenant shall have 1 right (the “Extension Right”) to
extend the term of this Lease for 36 months (the “Extension Term”) on the same
terms and conditions as this Lease (other than with respect to Base Rent) by
giving Landlord written notice of its election to exercise the Extension Right
at least 9 months prior, and no earlier than 12 months prior, to the expiration
of the Base Term of this Lease.

 

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Upon the commencement of the Extension Term, Base Rent shall be payable at the
Market Rate (as defined below). Base Rent shall thereafter be adjusted on each
annual anniversary of the commencement of such Extension Term by a percentage as
determined by Landlord and agreed to by Tenant at the time the Market Rate is
determined. As used herein, “Market Rate” shall mean the rate that comparable
landlords of comparable buildings have accepted in current transactions from
non-equity (i.e., not being offered equity in the buildings) and nonaffiliated
tenants of similar financial strength for space of comparable size and quality
(including all Tenant Improvements, Alterations and other improvements) in Class
A laboratory/office buildings in the Torrey Pines area of San Diego for a
comparable term, with the determination of the Market Rate to take into account
all relevant factors, including tenant inducements, views, available amenities
(including, without limitation, the Alexandria Regional Amenities (as defined in
Section 40 below), age of the Building, age of mechanical systems serving the
Premises, parking costs, leasing commissions, allowances or concessions, if any.

 

If, on or before the date which is 240 days prior to the expiration of the Base
Term of this Lease, Tenant has not agreed with Landlord’s determination of the
Market Rate and the rent escalations during the Extension Term after negotiating
in good faith, Tenant shall be deemed to have elected arbitration as described
in Section 39(b). Tenant acknowledges and agrees that, if Tenant has elected to
exercise the Extension Right by delivering notice to Landlord as required in
this Section 39(a), Tenant shall have no right thereafter to rescind or elect
not to extend the term of this Lease for the Extension Term.

 

(b) Arbitration.

 

(i) Within 10 days of Tenant’s notice to Landlord of its election (or deemed
election) to arbitrate Market Rate and escalations, each party shall deliver to
the other a proposal containing the Market Rate and escalations that the
submitting party believes to be correct (“Extension Proposal”). If either party
fails to timely submit an Extension Proposal, the other party’s submitted
proposal shall determine the Base Rent and escalations for the Extension Term.
If both parties submit Extension Proposals, then Landlord and Tenant shall meet
within 7 days after delivery of the last Extension Proposal and make a good
faith attempt to mutually appoint a single Arbitrator (and defined below) to
determine the Market Rate and escalations. If Landlord and Tenant are unable to
agree upon a single Arbitrator, then each shall, by written notice delivered to
the other within 10 days after the meeting, select an Arbitrator. If either
party fails to timely give notice of its selection for an Arbitrator, the other
party’s submitted proposal shall determine the Base Rent for the Extension Term.
The 2 Arbitrators so appointed shall, within 5 business days after their
appointment, appoint a third Arbitrator. If the 2 Arbitrators so selected cannot
agree on the selection of the third Arbitrator within the time above specified,
then either party, on behalf of both parties, may request such appointment of
such third Arbitrator by application to any state court of general jurisdiction
in the jurisdiction in which the Premises are located, upon 10 days prior
written notice to the other party of such intent.

 

(ii) The decision of the Arbitrator(s) shall be made within 30 days after the
appointment of a single Arbitrator or the third Arbitrator, as applicable. The
decision of the single Arbitrator shall be final and binding upon the parties.
The average of the two closest Arbitrators in a three Arbitrator panel shall be
final and binding upon the parties. Each party shall pay the fees and expenses
of the Arbitrator appointed by or on behalf of such party and the fees and
expenses of the third Arbitrator shall be borne equally by both parties. If the
Market Rate and escalations are not determined by the first day of the Extension
Term, then Tenant shall pay Landlord Base Rent in an amount equal to the Base
Rent in effect immediately prior to the Extension Term and increased by the Rent
Adjustment Percentage until such determination is made. After the determination
of the Market Rate and escalations, the parties shall make any necessary
adjustments to such payments made by Tenant. Landlord and Tenant shall then
execute an amendment recognizing the Market Rate and escalations for the
Extension Term.

 

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(iii) An “Arbitrator” shall be any person appointed by or on behalf of either
party or appointed pursuant to the provisions hereof and: (i) shall be (A) a
member of the American Institute of Real Estate Appraisers with not less than 10
years of experience in the appraisal of improved office and high tech industrial
real estate in the greater San Diego metropolitan area, or (B) a licensed
commercial real estate broker with not less than 15 years’ experience
representing landlords and/or tenants in the leasing of high tech or life
sciences space in the greater San Diego metropolitan area, (ii) devoting
substantially all of their time to professional appraisal or brokerage work, as
applicable, at the time of appointment and (iii) be in all respects impartial
and disinterested.

 

(c) Rights Personal. Extension Rights are personal to Tenant and are not
assignable without Landlord’s consent, which may be granted or withheld in
Landlord’s sole discretion separate and apart from any consent by Landlord to an
assignment of Tenant’s interest in the Lease, except that they may be assigned
in connection with any Permitted Assignment of this Lease.

 

(d) Exceptions. Notwithstanding anything set forth above to the contrary,
Extension Rights shall, at Landlord’s option, not be in effect and Tenant may
not exercise any of the Extension Rights:

 

(i) during any period of time that Tenant is in Default (beyond any applicable
notice and cure period) under any provision of this Lease; or

 

(ii) if Tenant has been in Default under any provision of this Lease 3 or more
times, whether or not the Defaults are cured, during the 12 month period
immediately prior to the date that Tenant intends to exercise the Extension
Right, whether or not the Defaults are cured.

 

(e) No Extensions. The period of time within which the Extension Right may be
exercised shall not be extended or enlarged by reason of Tenant’s inability to
exercise the Extension Right.

 

(f) Termination. The Extension Right shall, at Landlord’s option, terminate and
be of no further force or effect even after Tenant’s due and timely exercise of
the Extension Right, if, after such exercise, but prior to the commencement date
of an Extension Term, Tenant has Defaulted 3 or more times during the period
from the date of the exercise of an Extension Right to the date of the
commencement of the Extension Term, whether or not such Defaults are cured.

 

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40. Regional Amenities.

 

(a) Generally. Located at the project commonly known as 10996 Torreyana Road,
San Diego, California (“The Alexandria”), which is owned by an affiliate of
Landlord (“The Alexandria Landlord”), are certain amenities which include,
without limitation, shared conference facilities (the “The Alexandria Shared
Conference Facilities”), a fitness center and restaurant (collectively, the “The
Alexandria Amenities”). Located at the project commonly known as 10290 Campus
Point and 10300 Campus Point Drive, San Diego, California (collectively, the
“Campus Point Project”), which is owned by another affiliate or affiliates of
Landlord (collectively, the “Campus Point Landlord”), are certain amenities
which include, without limitation, shared conference facilities (the “Campus
Point Shared Conference Facilities”), a fitness center and restaurant
(collectively, the “Campus Point Amenities”). The Alexandria Shared Conference
Facilities and the Campus Point Shared Conference Facilities may be collectively
referred to herein as the “Shared Conference Facilities.” The Alexandria
Amenities and the Campus Point Amenities may be collectively referred to herein
as the “Alexandria Regional Amenities.” The Alexandria Regional Amenities are
available for non-exclusive use by (a) Tenant, (b) other tenants of the Project,
(c) Landlord, (d) the tenants of The Alexandria Landlord and the Campus Point
Landlord, (e) The Alexandria Landlord, (f) other affiliates of Landlord, The
Alexandria Landlord, the Campus Point Landlord and Alexandria Real Estate
Equities, Inc. (“ARE”), (g) the tenants of such other affiliates of Landlord,
The Alexandria Landlord, the Campus Point Landlord and ARE, and (h) any other
parties permitted by The Alexandria Landlord and Campus Point Landlord
(collectively, “Users”). Landlord, The Alexandria Landlord, Campus Point
Landlord, ARE, and all affiliates of Landlord, The Alexandria Landlord, Campus
Point Landlord and ARE may be referred to collectively herein as the “ARE
Parties.” Notwithstanding anything to the contrary contained herein, Tenant
acknowledges and agrees that (i) The Alexandria Landlord shall have the right,
at the sole discretion of The Alexandria Landlord, to not make The Alexandria
Amenities available for use by some or all currently contemplated Users
(including Tenant), and Campus Point Landlord shall have the right, at the sole
discretion of Campus Point Landlord, to not make the Campus Point Amenities
available for use by some or all currently contemplated Users (including
Tenant). The Alexandria Landlord and Campus Point Landlord shall have the sole
right to determine all matters related to The Alexandria Amenities and the
Campus Point Amenities, respectively, including, without limitation, relating to
the reconfiguration, relocation, modification or removal of any of The
Alexandria Amenities or the Campus Point Amenities, respectively, and/or to
revise, expand or discontinue any of the services (if any) provided in
connection with The Alexandria Amenities or the Campus Point Amenities,
respectively. Tenant acknowledges and agrees that Landlord has not made any
representations or warranties regarding the availability of the Alexandria
Regional Amenities and that Tenant is not entering into this Lease relying on
the continued availability of the Alexandria Regional Amenities to Tenant.

 

(b) License. Commencing on the Commencement Date, and so long as The Alexandria,
the Campus Point Project and the Project continue to be owned by affiliates of
ARE, Tenant (and, subject to Landlord’s approval, which may be granted or
withheld in Landlord’s reasonable discretion with respect to each prospective
subtenant, the subtenants of Tenant) shall have the non-exclusive right to the
use of the available Alexandria Regional Amenities in common with other Users
pursuant to the terms of this Section 40. Fitness center passes shall be issued
to Tenant for all full time employees of Tenant employed at the Premises.
Commencing on the Commencement Date, Tenant shall commence paying Landlord a
fixed fee during the Base Term equal to $0.18 per rentable square foot of the
Premises per month (“Amenities Fee”), which Amenities Fee shall by payable on
the first day of each month during the Term whether or not Tenant elects to use
any or all of the Alexandria Regional Amenities. The Amenities Fee shall be
increased annually on each anniversary of the Commencement Date by 3%. If all of
the Alexandria Regional Amenities become materially unavailable for use by
Tenant (for any reason other than a Default by Tenant under this Lease or the
default by Tenant of any agreement(s) relating to the use of the Alexandria
Regional Amenities by Tenant) for a period in excess of 90 consecutive days,
then, commencing on the date that the Alexandria Regional Amenities in their
entirety become materially unavailable for use by Tenant and continuing for the
period that the Alexandria Amenities in their entirety remain materially
unavailable for use by Tenant, the Amenities Fee then-currently payable by
Tenant shall be abated.

 

(c) Shared Conference Facilities. Use by Tenant of the Shared Conference
Facilities and restaurants at The Alexandria and the Campus Point Project shall
be in common with other Users with scheduling procedures reasonably determined
by The Alexandria Landlord or the Campus Point Landlord, as applicable, or The
Alexandria Landlord’s or Campus Point Landlord’s then designated event operator
(each, an “Event Operator”). Tenant’s use of the Shared Conference Facilities
shall be subject to the payment by Tenant to The Alexandria Landlord or the
Campus Point Landlord, as applicable, of a fee equal to The Alexandria
Landlord’s or Campus Point Landlord’s, as applicable, quoted rates for the usage
of the Shared Conference Facilities in effect at the time of Tenant’s
scheduling. Tenant’s use of the conference rooms in the Shared Conference
Facilities shall be subject to availability and The Alexandria Landlord and
Campus Point Landlord, as applicable, (or, if applicable, the applicable Event
Operator) reserves the right to exercise its reasonable discretion in the event
of conflicting scheduling requests among Users. Tenant hereby acknowledges that
(i) Biocom/San Diego, a California non-profit corporation (“Biocom”) has the
right to reserve the Alexandria Shared Conference Facilities and any reservable
dining area(s) included within The Alexandria Amenities for up to 50% of the
time that The Alexandria Shared Conference Facilities and reservable dining
area(s) are available for use by Users each calendar month, and (ii) Illumina,
Inc., a Delaware corporation, has the exclusive use of the main conference room
within The Alexandria Shared Conference Facilities for up to 4 days per calendar
month.

 

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 Tenant shall be required to use the food service operator designated by The
Alexandria Landlord at The Alexandria and the food service operator designated
by the Campus Point Landlord at the Campus Point Project (as applicable, the
“Designated Food and Beverage Operator”) for any food and/or beverage service or
catered events held by Tenant in the Shared Conference Facilities. As of the
date of this Lease, the Designated Food and Beverage Operator at The Alexandria
is The Farmer and the Seahorse and the Designated Food and Beverage Operator at
the Campus Point Project is Stellar Bleu. The Alexandria Landlord and the Campus
Point Landlord have the right, in their sole and absolute discretion, to change
the Designated Food and Beverage Operator at any time. Tenant may not use any
vendors other than the Designated Food and Beverage Operator nor may Tenant
supply its own food and/or beverages in connection with any food and/or beverage
service or catered events held by Tenant in the Shared Conference Facilities.

 

 Tenant shall, at Tenant’s sole cost and expense, (i) be responsible for the
set-up of the Shared Conference Facilities in connection with Tenant’s use
(including, without limitation ensuring that Tenant has a sufficient number of
chairs and tables and the appropriate equipment), and (ii) surrender the Shared
Conference Facilities after each time that Tenant uses the Shared Conference
Facilities free of Tenant’s personal property, in substantially the same set up
and same condition as received, and free of any debris and trash. If Tenant
fails to restore and surrender the Shared Conference Facilities as required by
sub-section (ii) of the immediately preceding sentence, such failure shall
constitute a “Shared Facilities Default.” Each time that Landlord reasonably
determines that Tenant has committed a Shared Facilities Default, Tenant shall
be required to pay Landlord a penalty within 5 days after notice from Landlord
of such Shared Facilities Default. The penalty payable by Tenant in connection
with the first Shared Facilities Default shall be $200. The penalty payable
shall increase by $50 for each subsequent Shared Facilities Default (for the
avoidance of doubt, the penalty shall be $250 for the second Shared Facilities
Default, shall be $300 for the third Shared Facilities Default, etc.). In
addition to the foregoing, Tenant shall be responsible for reimbursing The
Alexandria Landlord, the Campus Point Landlord or Landlord, as applicable, for
all costs expended by The Alexandria Landlord, the Campus Point Landlord or
Landlord, as applicable, in repairing any damage to the Shared Conference
Facilities, the Alexandria Regional Amenities, The Alexandria or the Campus
Point Project caused by Tenant or any Tenant Related Party. The provisions of
this Section 40(c) shall survive the expiration or earlier termination of this
Lease.

 

(d) Rules and Regulations. Tenant shall be solely responsible for paying for any
and all ancillary services (e.g., audio visual equipment) provided to Tenant,
all food services operators and any other third party vendors providing services
to Tenant at The Alexandria or the Campus Point Project. Tenant shall use the
Alexandria Regional Amenities (including, without limitation, The Alexandria
Shared Conference Facilities and the Campus Point Shared Conference Facilities)
in compliance with all applicable Legal Requirements and any rules and
regulations imposed by The Alexandria Landlord or the Campus Point Landlord,
respectively, or Landlord from time to time and in a manner that will not
interfere with the rights of other Users. The use of the Alexandria Regional
Amenities other than the Shared Conference Facilities by employees of Tenant
shall be in accordance with the terms and conditions of the standard licenses,
indemnification and waiver agreement required by The Alexandria Landlord, the
Campus Point Landlord or any operator of the Alexandria Regional Amenities, as
applicable, to be executed by all persons wishing to use such Alexandria
Regional Amenities. Neither The Alexandria Landlord, the Campus Point Landlord
nor Landlord (nor, if applicable, any other affiliate of Landlord) shall have
any liability or obligation for the breach of any rules or regulations by other
Users with respect to the Alexandria Regional Amenities. Tenant shall not make
any alterations, additions, or improvements of any kind to any of the Alexandria
Regional Amenities, The Alexandria or the Campus Point Project.

 

 Tenant acknowledges and agrees that The Alexandria Landlord and the Campus
Point Landlord, shall have the right at any time and from time to time to
reconfigure, relocate, modify or remove any of the Alexandria Regional Amenities
at The Alexandria or the Campus Point Project, respectively, and/or to revise,
expand or discontinue any of the services (if any) provided in connection with
the Alexandria Regional Amenities.

 

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(e) Waiver of Liability and Indemnification. Tenant warrants that it will use
reasonable care to prevent damage to property and injury to persons while on The
Alexandria or the Campus Point Project. Tenant waives any claims it or any
Tenant Parties may have against any ARE Parties relating to, arising out of or
in connection with the use by Tenant and/or any Tenant Parties of the Alexandria
Regional Amenities and any entry by Tenant and/or any Tenant Parties onto The
Alexandria of the Campus Point Project, and Tenant releases and exculpates all
ARE Parties from any liability relating to, arising out of or in connection with
the Alexandria Regional Amenities and any entry by Tenant and/or any Tenant
Parties onto The Alexandria and/or the Campus Point Project, except, in each
case, to the extent caused by the willful misconduct or gross negligence of any
ARE Party. Tenant hereby agrees to indemnify, defend, and hold harmless the ARE
Parties from any claim of damage to property or injury to person relating to,
arising out of or in connection with (i) the use of the Alexandria Regional
Amenities by Tenant or any Tenant Parties, and (ii) any entry by Tenant and/or
any Tenant Parties onto The Alexandria and/or the Campus Point Project, except
to the extent caused by the willful misconduct or negligence of any ARE Party.
The provisions of this Section 40 shall survive the expiration or earlier
termination of this Lease.

 

(f) Insurance. As of the Commencement Date, Tenant shall cause The Alexandria
Landlord and the Campus Point Landlord to be named as additional insureds under
the commercial general liability policy of insurance that Tenant is required to
maintain pursuant to Section 17 of this Lease.

 

41. Landlord’s Right to Relocate Tenant. Landlord shall have the right to
relocate Tenant, upon 90 days’ prior written notice, from all or part of the
Premises to another area in the Project designated by Landlord (the “Relocation
Premises”), provided that: (a) the size of the Relocation Premises is at least
equal to the size of the Premises, and (b) Landlord pays the reasonable costs of
moving Tenant and improving the Relocation Premises to a substantially similar
standard (including with respect to Installations located in the Premises) as
that of the Premises, and reimburses Tenant for all reasonable costs directly
incurred by Tenant as a result of relocation, including without limitation all
costs incurred by Tenant replacing Tenant’s letterhead, promotional materials,
business cards and similar items. Tenant shall cooperate with Landlord in all
reasonable ways to facilitate relocation.

 

42. HazMat Storage Area. Notwithstanding anything to the contrary contained in
this Lease, commencing on the Commencement Date, Tenant shall have the right to
use the Hazardous Materials storage area described on Exhibit I attached hereto
(“HazMat Storage Area”), for the storage of Tenant’s Hazardous Materials (not
including flammable materials, which may in no event be stored in the HazMat
Storage Area). Tenant shall have all of the obligations under the Lease with
respect to the HazMat Storage Area as though the HazMat Storage Area were part
of the Premises, excluding the obligation to pay Base Rent. Tenant shall
maintain appropriate records, obtain and maintain appropriate insurance,
implement reporting procedures, and take or cause to be taken all other actions
necessary or required under applicable Legal Requirements in connection with the
use of the HazMat Storage Area. Landlord shall have no obligation to make any
repairs or other improvements to the HazMat Storage Area and Tenant shall
maintain the same, at Tenant’s sole cost and expense, in good repair and
condition during the Term as though the same were part of the Premises. Tenant
shall not make any alterations, additions, or improvements to the HazMat Storage
Area of any kind whatsoever. The number of parking spaces which Tenant has the
right to use pursuant to Section 10 of the Lease shall be reduced by 1 parking
space during the term of the Lease with respect to the HazMat Storage Area. The
term of the Lease with respect to the HazMat Storage Area shall expire on the
expiration date of the Term of the Lease; provided, however, that either
Landlord or Tenant may terminate Tenant’s right to use the HazMat Storage Area
before such date upon 60 days prior written notice to the other. Tenant shall,
at Tenant’s sole cost and expense, surrender the HazMat Storage Area at the
expiration or earlier termination of the Term of the Lease with respect to the
HazMat Storage Area free of any screening or other improvements, free of any
debris and trash and free of any Hazardous Materials in accordance with the
requirements of Section 28 of the Lease.

 

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43. Storage Area. Notwithstanding anything to the contrary contained in this
Lease, commencing on the Commencement Date, Tenant shall have the right to use
the storage area described on Exhibit I attached hereto (“Storage Area”), for
the storage of Tenant’s property and for no other use or purpose, at no
additional cost. Tenant may not store Hazardous Materials in the Storage Area.
Tenant may install, at Tenant sole cost or expense, a locking fence or gate
around the Storage Area of a design and type acceptable to Landlord, in
Landlord’s sole and absolute discretion. Landlord shall have the right, in its
sole and absolute discretion, to require Tenant to remove any such fence or gate
installed by Tenant and restore all the Storage Area to its original condition
upon the expiration or earlier termination of the Term. The Storage Area shall
be confined to 2 parking spaces, and the number of parking spaces which Tenant
has the right to use pursuant to Section 10 of the Lease shall be reduced by 2
parking spaces during the Term of the Lease with respect to the Storage Area.
Landlord shall have no obligation to make any repairs or improvements to the
Storage Area and Tenant shall maintain the same, at Tenant’s sole cost and
expense, in an orderly manner and good repair and condition during the Term as
though the same were part of the Premises. At the expiration or earlier
termination of the Term, Tenant shall, at Tenant’s sole cost and expense, remove
all of Tenant’s personal property from the Storage Area and deliver the Storage
Area to Landlord free of any debris and trash and free of any Hazardous
Materials.

 

44. Miscellaneous.

 

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

 

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

 

(c) Financial Information. Tenant shall furnish Landlord with true and complete
copies of (i) Tenant’s most recent unaudited (or the extent available, audited)
annual financial statements within 90 days of the end of each of Tenant’s fiscal
years during the Term, (ii) Tenant’s most recent unaudited quarterly financial
statements within 45 days of the end of each of Tenant’s first three fiscal
quarters of each of Tenant’s fiscal years during the Term, (iii) at Landlord’s
request from time to time (but no more than once per year), updated business
plans, including cash flow projections and/or pro forma balance sheets and
income statements, all of which shall be treated by Landlord as confidential
information belonging to Tenant, (iv) corporate brochures and/or profiles
prepared by Tenant for prospective investors, and (v) any other financial
information or summaries that Tenant typically provides to its lenders or
shareholders. So long as Tenant is a “public company” and its financial
information is publicly available, then the foregoing requirements of this
Section 43(c) shall not apply.

 

(d) Recordation. Neither this Lease nor a memorandum of lease shall be filed by
or on behalf of Tenant in any public record. Landlord may prepare and file, at
Landlord’s sole cost and expense and upon written request by Landlord Tenant
will execute, a memorandum of lease with respect to this Lease.

 

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

 

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

 

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

 

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

 

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

 

(j) OFAC. Tenant and Landlord are currently (a) in compliance with and shall at
all times during the Term of this Lease remain in compliance with the
regulations of the Office of Foreign Assets Control (“OFAC”) of the U.S.
Department of Treasury and any statute, executive order, or regulation relating
thereto (collectively, the “OFAC Rules”), (b) not listed on, and shall not
during the Term of this Lease be listed on, the Specially Designated Nationals
and Blocked Persons List, Foreign Sanctions Evaders List, or the Sectoral
Sanctions Identification List, which are all maintained by OFAC and/or on any
other similar list maintained by OFAC or other governmental authority pursuant
to any authorizing statute, executive order, or regulation, and (c) not a person
or entity with whom a U.S. person is prohibited from conducting business under
the OFAC Rules.

 

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

 

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

 

(m) No Accord and Satisfaction. No payment by Tenant or receipt by Landlord of a
lesser amount than the monthly installment of Base Rent or any Additional Rent
will be other than on account of the earliest stipulated Base Rent and
Additional Rent, nor will any endorsement or statement on any check or letter
accompanying a check for payment of any Base Rent or Additional Rent be an
accord and satisfaction. Landlord may accept such check or payment without
prejudice to Landlord’s right to recover the balance of such Rent or to pursue
any other remedy provided in this Lease.

 

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

 

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(o) Redevelopment of Project. Tenant acknowledges that Landlord, in its sole
discretion, may from time to time expand, renovate and/or reconfigure the
Project as the same may exist from time to time and, in connection therewith or
in addition thereto, as the case may be, from time to time without limitation:
(a) change the shape, size, location, number and/or extent of any improvements,
buildings, structures, lobbies, hallways, entrances, exits, parking and/or
parking areas relative to any portion of the Project; (b) modify, eliminate
and/or add any buildings, improvements, and parking structure(s) either above or
below grade, to the Project, the Common Areas and/or any other portion of the
Project and/or make any other changes thereto affecting the same; and (c) make
any other changes, additions and/or deletions in any way affecting the Project
and/or any portion thereof as Landlord may elect from time to time, including
without limitation, additions to and/or deletions from the land comprising the
Project, the Common Areas and/or any other portion of the Project.
Notwithstanding anything to the contrary contained in this Lease, Tenant shall
have no right to seek damages (including abatement of Rent) or to cancel or
terminate this Lease because of any proposed changes, expansion, renovation or
reconfiguration of the Project nor shall Tenant have the right to restrict,
inhibit or prohibit any such changes, expansion, renovation or reconfiguration;
provided, however, Landlord shall not change the size, dimensions, location or
Tenant’s Permitted Use of the Premises. Landlord shall use reasonable efforts to
cause the redevelopment contemplated pursuant to this Section 45(o) to be
performed in a manner that does not materially and adversely affect Tenant’s
beneficial use and occupancy of the Premises and/or access to or use of parking
at the Project, other than on a temporary basis while construction and related
work may be ongoing. No expansion, renovation and/or reconfiguring of the
Project pursuant to this paragraph will result in Tenant having fewer parking
spaces available for its use other than on a temporary basis while construction
and related work may be ongoing, and during such periods Landlord shall provide
substitute parking in reasonable proximity to the Project.

 

(p) Discontinued Use. If, at any time following the Commencement Date, Tenant
does not continuously conduct business operations in the Premises for a period
of 180 consecutive days, Landlord may, but is not obligated to, elect to
terminate this Lease upon 30 days’ written notice to Tenant, whereupon this
Lease shall terminate 30 days’ after Landlord’s delivery of such written notice
(“Termination Date”), and Tenant shall vacate the Premises and deliver
possession thereof to Landlord in the condition required by the terms of this
Lease on or before the Termination Date and Tenant shall have no further
obligations under this Lease except for those accruing prior to the Termination
Date and those which, pursuant to the terms of the Lease, survive the expiration
or early termination of the Lease.

 

(q) EV Charging Stations. Landlord shall not unreasonably withhold its consent
to Tenant’s written request to install 1 or more electric vehicle car charging
stations (“EV Stations”) in the parking area serving the Project; provided,
however, that Tenant complies with all reasonable requirements, standards, rules
and regulations which may be imposed by Landlord, at the time Landlord’s consent
is granted, in connection with Tenant’s installation, maintenance, repair and
operation of such EV Stations, which may include, without limitation, the charge
to Tenant of a reasonable monthly rental amount for the parking spaces used by
Tenant for such EV Stations, Landlord’s designation of the location of Tenant’s
EV Stations, and Tenant’s payment of all costs whether incurred by Landlord or
Tenant in connection with the installation, maintenance, repair and operation of
each Tenant’s EV Station(s). Nothing contained in this paragraph is intended to
increase the number of parking spaces which Tenant is otherwise entitled to use
at the Project under Section 10 of this Lease nor impose any additional
obligations on Landlord with respect to Tenant’s parking rights at the Project.

 

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(r) California Accessibility Disclosure. For purposes of Section 1938(a) of the
California Civil Code, Landlord hereby discloses to Tenant, and Tenant hereby
acknowledges, that the Project has not undergone inspection by a Certified
Access Specialist (CASp). In addition, the following notice is hereby provided
pursuant to Section 1938(e) of the California Civil Code: “A Certified Access
Specialist (CASp) can inspect the subject premises and determine whether the
subject premises comply with all of the applicable construction-related
accessibility standards under state law. Although state law does not require a
CASp inspection of the subject premises, the commercial property owner or lessor
may not prohibit the lessee or tenant from obtaining a CASp inspection of the
subject premises for the occupancy or potential occupancy of the lessee or
tenant, if requested by the lessee or tenant. The parties shall mutually agree
on the arrangements for the time and manner of the CASp inspection, the payment
of the fee for the CASp inspection, and the cost of making any repairs necessary
to correct violations of construction-related accessibility standards within the
premises.” In furtherance of and in connection with such notice: (i) Tenant,
having read such notice and understanding Tenant’s right to request and obtain a
CASp inspection, hereby elects not to obtain such CASp inspection and forever
waives its rights to obtain a CASp inspection with respect to the Premises,
Building and/or Project to the extent permitted by Legal Requirements; and (ii)
if the waiver set forth in clause (i) hereinabove is not enforceable pursuant to
Legal Requirements, then Landlord and Tenant hereby agree as follows (which
constitutes the mutual agreement of the parties as to the matters described in
the last sentence of the foregoing notice): (A) Tenant shall have the one-time
right to request for and obtain a CASp inspection, which request must be made,
if at all, in a written notice delivered by Tenant to Landlord; (B) any CASp
inspection timely requested by Tenant shall be conducted (1) at a time mutually
agreed to by Landlord and Tenant, (2) in a professional manner by a CASp
designated by Landlord and without any testing that would damage the Premises,
Building or Project in any way, and (3) at Tenant’s sole cost and expense,
including, without limitation, Tenant’s payment of the fee for such CASp
inspection, the fee for any reports prepared by the CASp in connection with such
CASp inspection (collectively, the “CASp Reports”) and all other costs and
expenses in connection therewith; (C) the CASp Reports shall be delivered by the
CASp simultaneously to Landlord and Tenant; (D) Tenant, at its sole cost and
expense, shall be responsible for making any improvements, alterations,
modifications and/or repairs to or within the Premises to correct violations of
construction-related accessibility standards including, without limitation, any
violations disclosed by such CASp inspection; and (E) if such CASp inspection
identifies any improvements, alterations, modifications and/or repairs necessary
to correct violations of construction-related accessibility standards relating
to those items of the Building and Project located outside the Premises that are
Landlord’s obligation to repair as set forth in this Lease, then Landlord shall
perform such improvements, alterations, modifications and/or repairs as and to
the extent required by Legal Requirements to correct such violations, and Tenant
shall reimburse Landlord for the cost of such improvements, alterations,
modifications and/or repairs within 10 business days after Tenant’s receipt of
an invoice therefor from Landlord.

 

(s) Consents. Except as otherwise specified in this Lease as being subject to a
party’s sole and absolute discretion, whenever this Lease requires approval,
consent, designation, determination, selection or judgment by either Landlord or
Tenant, such approval, consent, designation, determination, selection or
judgment and any conditions imposed thereby shall be reasonable and shall not be
unreasonably withheld or delayed and, in exercising any right or remedy
hereunder, each party shall at all times act reasonably in good faith.

 

(t) Counterparts. This Lease may be executed in 2 or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument. Counterparts may be delivered via facsimile,
electronic mail (including pdf or any electronic signature process complying
with the U.S. federal ESIGN Act of 2000) or other transmission method and any
counterpart so delivered shall be deemed to have been duly and validly delivered
and be valid and effective for all purposes. Electronic signatures shall be
deemed original signatures for purposes of this Lease and all matters related
thereto, with such electronic signatures having the same legal effect as
original signatures.

 

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

 

  TENANT:         ONCOSEC MEDICAL INCORPORATED,   a Nevada corporation        
By: /s/ Daniel J. O’Connor   Daniel J. O’Connor   Its:  PRES. & CEO        
LANDLORD:         3535/3565 GENERAL ATOMICS COURT, LLC,   a Delaware limited
liability company         By: ALEXANDRIA REAL ESTATE EQUITIES, L.P.,     a
Delaware limited partnership,   managing member          By: /s/ Gary Dean    
Gary Dean   Its: Senior Vice President     RE Legal Affairs

 

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EXHIBIT A TO LEASE

 

DESCRIPTION OF PREMISES

 

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EXHIBIT B TO LEASE

 

DESCRIPTION OF PROJECT

 

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EXHIBIT C TO LEASE

 

INTENTIONALLY OMITTED

 

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EXHIBIT D TO LEASE

 

ACKNOWLEDGMENT OF COMMENCEMENT DATE

 

This ACKNOWLEDGMENT OF COMMENCEMENT DATE is made this _____ day of
______________, ____, between 3535/3565 GENERAL ATOMICS COURT, LLC, a Delaware
limited liability company (“Landlord”), and ONCOSEC MEDICAL INCORPORATED, a
Nevada corporation (“Tenant”), and is attached to and made a part of the Lease
dated ______________, _____ (the “Lease”), by and between Landlord and Tenant.
Any initially capitalized terms used but not defined herein shall have the
meanings given them in the Lease.

 

Landlord and Tenant hereby acknowledge and agree, for all purposes of the Lease,
that the Commencement Date of the Base Term of the Lease is ______________,
_____, and the termination date of the Base Term of the Lease shall be midnight
on ______________, _____. In case of a conflict between the terms of the Lease
and the terms of this Acknowledgment of Commencement Date, this Acknowledgment
of Commencement Date shall control for all purposes.

 

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

 

  TENANT:         ONCOSEC MEDICAL INCORPORATED,   a Nevada corporation        
By:     Its:           LANDLORD:         3535/3565 GENERAL ATOMICS COURT, LLC,  
a Delaware limited liability company       By: ALEXANDRIA REAL ESTATE EQUITIES,
L.P.,   a Delaware limited partnership,   managing member         By: ARE-QRS
CORP.,     a Maryland corporation,     general partner       By:   Its:   

 

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EXHIBIT E TO LEASE

 

Rules and Regulations

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

20. Tenant shall cause any vendors and other service providers hired by Tenant
to perform services at the Premises or the Project to maintain in effect
workers’ compensation insurance as required by Legal Requirements and commercial
general liability insurance with coverage amounts reasonably acceptable to
Landlord. Tenant shall cause such vendors and service providers to name Landlord
and Alexandria Real Estate Equities, Inc. as additional insureds under such
policies and shall provide Landlord with certificates of insurance evidencing
the required coverages (and showing Landlord and Alexandria Real Estate
Equities, Inc. as additional insureds under such policies) prior to the
applicable vendor or service provider providing any services to Tenant at the
Project.

 

21. Neither Tenant nor any of the Tenant Parties shall have the right to
photograph, videotape, film, digitally record or by any other means record,
transmit and/or distribute any images, pictures or videos of all or any portion
of the Premises or the Project.

 

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EXHIBIT F TO LEASE

 

TENANT’S PERSONAL PROPERTY

 

None.

 

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EXHIBIT G TO LEASE

 

MAINTENANCE OBLIGATIONS

 

Maintenance Responsibilities   TENANT   ARE   Exterior / Site   Landscaping   ☐
  ✔   Pest control (exterior)   ☐   ✔   Parking lot sweeping   ☐   ✔   Project
security (nightly rounds)   ☐   ✔   Parking lot lighting   ☐   ✔   Exterior
monument and footpath lighting   ☐   ✔   Landscape irrigation   ☐   ✔   Exterior
window washing   ☐   ✔   Roof inspections   ☐   ✔   Domestic backflow preventor
certification - Industrial / Domestic   ☐   ✔   Domestic backflow preventor
certification - Fire   ☐   ✔   Building Interior and Central Plant   Cold Rooms
  N/A   N/A   Autoclaves   ✔   ☐   Glassware washers   ✔   ☐   RO/DI laboratory
water systems   ☐   ✔   Air compressors   ☐   ✔   Vacuum pumps   ☐   ✔  
Laboratory gas distribution systems   ✔   ☐   Emergency eyewash and shower
stations   ✔   ☐   Internal UPS units   ✔   ☐   Elevators   ☐   ✔   Elevator
phone lines   ☐   ✔   Fire extinguisher inspection / certification   ☐   ✔  
Fire sprinkler system   ☐   ✔   Fire alarm system (and phone lines)   ☐   ✔  
Building HVAC equipment   ☐   ✔   Smoke fire dampers   ☐   ✔   Security - In
premesis   ✔   ☐   Access controls   ☐   ✔   CCTV   N/A   N/A   Janitorial -
Common Area   ☐   ✔   Janitorial - In tenant premises   ✔   ☐   I/R Testing of
electrical systems   ☐   ✔   Emergency Generator and APCD Permit   ☐   ✔  
Central Plant - chillers, boilers, cooling towers, pumps, etc.   ☐   ✔   Water
Treatment   ☐   ✔   Building Management Systems (DDC)   ☐   ✔   Tenant Equipment
monitoring (Alarms to freezers, incubators, etc.)   ✔   ☐  

 

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3565 General Atomics/Oncosec - Page 1

 

EXHIBIT H TO LEASE

 

CONTROL AREA

 

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3565 General Atomics/Oncosec - Page 1

 

EXHIBIT I TO LEASE

 

STORAGE AREAS

 

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3565 General Atomics/Oncosec - Page 1

 

EXHIBIT J TO LEASE

 

SIGNAGE

 

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