Exhibit 10.1

 

 

DEED OF LEASE

 

TABLE OF CONTENTS

 

ARTICLE   PAGE       1. DEFINITIONS 1 2. TERM 7 3. “AS-IS” CONDITION; TENANT’S
WORK 8 4. RENT 9 5. ADDITIONAL RENT 12 6. USE 15 7. CARE OF PREMISES 16 8.
ALTERATIONS BY TENANT 16 9. EQUIPMENT 18 10. OWNERSHIP AND REMOVAL OF PROPERTY
20 11. LANDLORD'S ACCESS TO PREMISES 21 12. SERVICES AND UTILITIES 22 13. RULES
AND REGULATIONS 23 14. REPAIR OF DAMAGE CAUSED BY TENANT:  INDEMNIFICATION 23
15. LIMITATION ON LANDLORD LIABILITY 24 16. FIRE AND OTHER CASUALTY 24 17.
INSURANCE 25 18. CONDEMNATION 28 19. DEFAULT 28 20. NO WAIVER 32 21. HOLDING
OVER 32 22. SUBORDINATION 32 23. ASSIGNMENT AND SUBLETTING 34 24. TRANSFER BY
LANDLORD 38 25. INABILITY TO PERFORM 38 26. ESTOPPEL CERTIFICATES 38 27.
COVENANT OF QUIET ENJOYMENT 38 28. WAIVER OF JURY TRIAL 39 29. BROKERS 39 30.
CERTAIN RIGHTS RESERVED BY LANDLORD 39 31. NOTICES 40 32. MISCELLANEOUS
PROVISIONS 41   A. Benefit and Burden 41   B. Governing Law 41   C. No
Partnership 41   D. Delegation by Landlord 41   E. Tenant Responsibility for
Agents 41   F. Invalidity of Particular Provisions 41   G. Counterparts 41   H.
Entire Agreement 41   I. Amendments 41   J. Mortgagee's Performance 41   K.
Limitation on Interest 41   L. Remedies Cumulative 41   M. Annual Financial
Statements 41   N. Construction of Lease 42   O. Time of the Essence 42   P.
Effect of Deletion of Language 42   Q. Authority 42   R. Qualified Leases 42 33.
[INTENTIONALLY OMITTED] 42 34. PARKING 42 35. SECURITY DEPOSIT 44 36. HAZARDOUS
MATERIALS 46 37. [INTENTIONALLY OMITTED] 49 38. NO RECORDATION 49 39. SIGNS 49
40. SURRENDER 50 41. OPTION TO EXTEND 51 42. TENANT’S TERMINATION OPTION 52 43.
MUST TAKE SPACE 54 44. RIGHT OF FIRST OFFER 56 SIGNATURES 58

 

 

 

 

Exhibit A-1 - First Floor Premises Plan Exhibit A-2 - Second Floor Premises Plan
Exhibit B - Laboratory Decommissioning Requirements Exhibit C - Declaration of
Acceptance Exhibit D - Work Agreement Exhibit E - Rules and Regulations Exhibit
F - Rules for Contractors Exhibit G - Plan Showing Must Take Space Exhibit H -
Form of Subordination, Non-Disturbance and Attornment Agreement

 

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DEED OF LEASE

 

THIS LEASE (the "Lease") is made and entered into this 4th day of February,
2015, by and between FIRSTFIELD HOLDCO, LLC a Delaware limited liability company
("Landlord") and NOVAVAX, INC., a Delaware corporation ("Tenant").

 

In consideration of the Rent hereinafter reserved and the agreements hereinafter
set forth, Landlord and Tenant mutually agree as follows:

 

1.    DEFINITIONS.

 

Lease Specific

 

A.     Building: a two (2) story building containing approximately Fifty-Two
Thousand Seven Ninety (52,790) square feet of rentable area as of the date
hereof and located at 21 Firstfield Road, Gaithersburg, MD 20878. Except as
otherwise expressly provided in this Lease, the term “Building” shall include
all portions of said building, including, but not limited to, the Premises, the
Common Areas and the parking and loading areas.

 

B.     Land: The real estate that supports the Building measuring, at the time
of this Lease, approximately 137,706 square feet, and all associated easements.

 

C.     Project: the Land, together with all equipment thereon, landscaping,
structures thereon (other than the Building), driveways and parking areas, and
the Building.

 

D.     Premises: approximately twenty-nine thousand nine hundred fifty-four
(29,954) square feet of rentable area consisting of (a) approximately three
thousand six hundred forty (3,640) square feet of rentable area located on the
first (1st) of the Building and known as Suite 100A (“Suite 100A”); (b)
approximately six thousand eight hundred eighty-four (6,884) square feet of
rentable area located on the first (1st) of the Building and known as Suite 100B
(“Suite 100B”, and, collectively with Suite 100A, the “First Floor Premises”);
(c) approximately fourteen thousand two hundred eighteen (14,218) square feet of
rentable area located on the second (2nd) floor of the Building and known as
Suite 200 A and B (“Suite 200”); and (d) approximately five thousand two hundred
twelve (5,212) square feet of rentable area located on the second (2nd) floor of
the Building and known as Suite 201 (“Suite 201”, and, collectively with Suite
200, the “Second Floor Premises”). The First Floor Premises and the Second Floor
Premises shall be referred to herein collectively, as the “Premises.” The First
Floor Premises are more particularly designated on Exhibit A-1 and the Second
Floor Premises are more particularly designated on Exhibit A-2. The rentable
area in the Building and in the Premises has been determined by Landlord's
architect and agreed to by Tenant in accordance with the Building Owners and
Managers Association International Standard Method for Measuring Floor Area in
Office Buildings, ANSI/BOMA Z65.1-1996, which determination includes an
allocation of the Shared Lab Space (as hereinafter defined), and the building
engineer’s office located on the first (1st) floor of the Building.

 

E.      Term: As more particularly defined in Section 2.A. hereof.

 

F.      Anticipated Lease Commencement Date: January 15, 2015. The actual Lease
Commencement Date shall be the date defined as such in Section 2.A. hereof.

 

G.     Base Rent: As set forth in Section 4.A hereof.

 

H.      Base Rent Annual Escalation Percentage: two and one-half percent
(2.5)%).

 

 

 

 

I.     Security Deposit: As set forth in Section 35.A.

 

J.     Brokers: Scheer Partners, Inc., as agent for Landlord, and Jones Lang
LaSalle, as agent for Tenant.

 

K.    Tenant Notice Address: Novavax, Inc., 20 Firstfield Road, Gaithersburg, MD
20878, Attention: General Counsel, prior to the Lease Commencement Date, and at
the Premises after the Lease Commencement Date.

 

L.     Landlord Notice Address: Firstfield Holdco, LLC, c/o 21 FF Manager LLC,
9201 Corporate Boulevard, Suite 420, Rockville, MD 20850, Attention: Charlotte
Cassell, Director, with a copy to Scheer Partners, 9201 Corporate Boulevard,
Suite 420, Rockville, MD 20850, Attention: Robert Scheer.

 

M. Landlord Payment Address: Firstfield Holdco, LLC, c/o 21 FF Manager LLC, 9201
Corporate Boulevard, Suite 420, Rockville, MD 20850, Attention: Charlotte
Cassell, Director; provided, however, that at Landlord’s sole option, following
at least thirty (30) days written notice to Tenant, Tenant shall thereafter make
all payments due and payable to Landlord under this Lease by means of electronic
transfers of funds from Tenant’s financial institution to Landlord’s designated
financial institution.

 

N.     Building Hours: 7:00 a.m. to 6:00 p.m. on Monday through Friday
(excluding Holidays) and 8:00 a.m. to 1:00 p.m. on Saturday (excluding Holidays
(as hereinafter defined)), and such additional hours, if any, as Landlord from
time to time reasonably determines.

 

O.     Guarantor(s): none.

 

P.     Parking Permits: Tenant shall be granted 3.4 Parking Permits per one
thousand (1,000) rentable square feet free of charge during the initial Term and
the Renewal Periods (as defined in Section 41 hereof).

 

General

 

Q.     Alterations: Any improvements, alterations, fixed decorations or
modifications, structural or otherwise, to the Premises, the Building or the
Land, as defined below, including but not limited to the installation or
modification of carpeting, partitions, counters, doors, air conditioning ducts,
electrical equipment, gas lines, lab benches, casework, autoclaves, glass
washers, freezers, built-in walk-in rooms, ceiling tiles, plumbing, piping,
lighting fixtures, wiring, hardware, locks, ceilings and window and wall
coverings.

 

R.     [Intentionally Omitted].

 

S.     Common Areas: Those areas of the Project made available by Landlord for
use by Tenant in common with Landlord, other tenants of the Building and the
employees, agents and invitees of Landlord and of such other tenants.

 

T.     Default Rate: That rate of interest which is five (5) percentage points
above the annual rate of interest which is publicly announced by Bank of America
or its successor entity, if applicable ("Bank of America"), from time to time as
its "prime" rate of interest, irrespective of whether such rate is the lowest
rate of interest charged by Bank of America to commercial borrowers. In the
event that Bank of America ceases to announce such a prime rate of interest,
Landlord, in Landlord's reasonable discretion, shall designate the prime rate of
interest by another bank located in the Washington, D.C. metropolitan area,
which shall be the prime rate of interest used to calculate the default rate.

 

U.     Ground Leases: All ground and other underlying leases from which
Landlord's title to the Land and/or the Building is or may in the future be
derived. "Ground Lessors" shall denote those persons and entities holding such
ground or underlying leases.

 

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V.     Holidays: New Year's Day, Presidents' Day, Martin Luther King, Jr.'s
Birthday, Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day,
Thanksgiving Day, Christmas Day and any other holidays designated by an
executive order of the President of the United States, Act of Congress, the
Governor of Maryland or the Maryland General Assembly; provided, however, that
Landlord retains the right, in its sole discretion, to increase or to decrease
the legal holidays which it observes.

 

W.     [Intentionally Omitted.]

 

X.     Lease Commencement Date: The date this Lease commences, as determined
pursuant to Section 2.A. below.

 

Y.     Lease Year: The first Lease Year shall be that period of time that
commences on the Lease Commencement Date and ends on the day immediately
preceding first anniversary of the Second Floor Premises Rent Commencement Date,
and each consecutive twelve (12) month period thereafter, except that the final
Lease Year shall be fewer than twelve (12) months; provided, however, that if
the Second Floor Premises Rent Commencement Date is not the first day of a
month, then the second Lease Year shall commence on the first day of the month
following the month in which the first anniversary of the Second Floor Premises
Rent Commencement Date occurs. The earliest such period shall be referred to as
the "first Lease Year," and each of the following Lease Years shall similarly be
numbered for identification purposes.

 

Z.     Mortgages: All mortgages, deeds of trust and similar security instruments
which may now or in the future encumber or otherwise affect the Building or the
Land, including mortgages related to both construction and permanent financing.
"Mortgagees" shall denote those persons and entities holding such mortgages,
deeds of trust and similar security instruments.

 

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AA.    Operating Expenses: All actual costs and expenses actually incurred by
Landlord during any calendar year in managing, repairing, replacing, operating
and maintaining the Project, as determined by Landlord in accordance with
generally accepted accounting principles to the extent applicable, and otherwise
in accordance with an accounting system established and regularly applied by
Landlord. Such costs and expenses shall include, but not be limited to, the cost
of water, gas, sanitary sewer, storm sewer, electricity and other utilities for
the Common Areas, trash removal, telephone and telecommunications services,
insurance, janitorial and char services and supplies, security services, labor
costs (including social security taxes and contributions and fringe benefits),
charges under maintenance and service contracts (including, but not limited to,
chillers, boilers, shared lab equipment, plumbing, elevators, window and
security services), central heating and air conditioning, property management
fees (not to exceed four percent (4%) of all Base Rent for the Building, which
Base Rent shall not include any Operating Expenses or Real Estate Tax Expenses
paid to Landlord by Tenant or by other tenants at the Building), business taxes,
license fees, public space and vault rentals and charges, costs, charges and
other assessments made by or for any entity operating a business improvement
district in which the Project is located, condominium fees, assessments, dues,
expenses, and other charges which are paid by Landlord as a result of the
Project or part of the Project being part of a condominium, and the cost of any
equipment or services provided by Landlord in connection with the servicing,
operation, maintenance, repair, replacement and protection of the Project and
related exterior appurtenances (whether or not provided on the Lease
Commencement Date). Operating Expenses shall include the cost of capital
improvements made by Landlord to manage, operate or maintain the Building,
together with any commercially reasonable financing charges incurred in
connection therewith, not to exceed twelve percent (12%) per annum, provided
that such costs shall be amortized over the useful life of the improvements in
accordance with generally accepted accounting principles, which shall be at
least a ten (10) year period for the purpose of this Section 1.AA., and only the
portion attributable to the calendar year shall be included in Operating
Expenses for the calendar year; further provided that capital expenditures shall
be limited to (a) improvements or building elements added to the Building which
in Landlord's reasonable judgment will increase the efficiency of the Building
(i.e., are reasonably anticipated by Landlord to reduce Operating Expenses as
they relate to the item which is the subject of a capital expenditure or to
reduce the rate of increase in the Operating Expense which relates to the item
which is the subject of the capital expenditure from what it otherwise may have
been reasonably anticipated to be in the absence of such capital expenditure),
and (b) improvements or replacements which are required to comply with the
requirements of any Laws, except with respect to any conditions existing in
violation thereof on the Lease Commencement Date. Operating Expenses shall not
include: (i) Real Estate Tax Expenses and franchise or income taxes imposed upon
Landlord; (ii) payments of principal and interest on any Mortgages; (iii)
leasing commissions; (iv) capital expenditures, except as specified above; (v)
the costs of special services and utilities separately paid by particular
tenants of the Building; (vi) costs which are reimbursed to Landlord by insurers
or by governmental authorities in eminent domain proceedings; (vii) advertising
for vacant space in the Building; (viii) costs of any equipment, services or
utilities which are provided solely to one or more retail tenants of the
Building; (ix) salaries, wages, or other compensation or benefits paid to
off-site employees or other employees of Landlord who are not assigned full-time
to the operation, management, maintenance, or repair of the Building above the
grade of Portfolio Manager; provided, however, that Operating Expenses shall
include Landlord’s reasonable allocation of compensation paid for the wages,
salary, or other compensation or benefits paid to personnel, if offsite, who are
assigned part-time to the operation, management, maintenance, or repair of the
Building; (x) judgments against Landlord or the Building and costs relating to
(x) disputes with third parties including Tenant, tenants, prospective tenants
or other occupants of the Building, (y) disputes with purchasers, prospective
purchasers, mortgagees or prospective mortgagees of the Building or the
Property, or (z) negotiations of leases, contracts of sale or mortgages; (xi)
costs in the nature of penalties or fines if Tenant is then current in the
payment of all Rent due under this Lease; (xii) costs for services, supplies or
repairs paid to any related entity in excess of costs that would be payable in
an “arm’s length” or unrelated situation for comparable services, supplies or
repairs; (xiii) allowances, concessions or other costs and expenses of improving
or decorating any demised or demisable space in the Building; (xiv) any costs or
expenses (including fines, interest, penalties and legal fees) arising out of
Landlord’s or any other tenant’s breach of any lease, including this Lease or
Landlord’s failure to timely pay operating expenses or real estate taxes if
Tenant is then current in the payment of all Rent due under this Lease; (xv)
costs incurred in connection with the survey, testing, removal, encapsulation,
remediation or other treatment of asbestos or any other hazardous materials at
the building or elsewhere unless caused by Tenant; (xvi) any costs actually
reimbursed under any service contracts or under the warranty of any general
contractor, subcontractor or supplier and realized by Landlord; (xvii) reserves
for repairs, maintenance, and replacements except in the year spent for
Operating Expenses which are incurred as permitted by this Lease; and (xviii)
costs of repairs incurred by reason of fire (other than for any reasonable
deductible) or other casualty or condemnation. In the event that, during any
calendar year or portion thereof during the Term, Landlord shall furnish any
service which is included in the definition of Operating Expenses to less than
one hundred percent (100%) of the rentable area of the Building because (i) less
than all of the rentable area of the Building is occupied, (ii) any such service
is not desired or required by any tenant, or (iii) any tenant is itself
obtaining or providing any such service, then the Operating Expenses for such
calendar year shall be increased to equal the total expenses that Landlord
reasonably estimates it would have incurred if Landlord had provided all such
services to one hundred percent (100%) of the rentable area of the Building for
the entire calendar year. For example, if the average occupancy rate of the
Building during a calendar year is eighty percent (80%), the service charges are
$1.00 per occupied rentable square foot per year, and the Building contains one
hundred thousand (100,000) rentable square feet of space, then it would be
reasonable for Landlord to estimate that, if the Building had been one hundred
percent (100%) occupied during the entire calendar year, service charges for
such calendar year would have been One Hundred Thousand Dollars ($100,000) and
to compute the Operating Expenses for such calendar year accordingly. In no
event shall the provisions of this paragraph be used to enable Landlord to
collect from the tenants of the Building more than one hundred percent (100%) of
the costs and expenses incurred by Landlord in managing, operating and
maintaining the Building and the Land. Notwithstanding the foregoing, in the
event that, during any calendar year or portion thereof during the Term,
Landlord shall furnish any utility which is included in the definition of
Operating Expenses, the cost of such utilities shall be grossed up in accordance
with a formula determined by Landlord in its reasonable discretion.

 

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BB.    Outside Release Date: Shall mean August 1, 2015.

 

CC.    Premises' Standard Electrical Capacity: The electrical capacity
sufficient to support Tenant's balanced consumption of thirty (30) watts per
square foot of rentable area.

 

DD.    Real Estate Tax Expenses: All (1) real estate taxes, arena taxes, solid
waste taxes and related charges, front foot benefit charges, special user fees,
rates, and assessments (including general and special assessments, if any),
ordinary and extraordinary, foreseen and unforeseen, which are imposed upon
Landlord or assessed against the Building or the Land or Landlord's personal
property used in connection therewith; (2) other present or future taxes or
governmental charges that are imposed upon Landlord or assessed against the
Building or the Land which are in the nature of or in substitution for real
estate taxes, including any tax levied on or measured by the rents payable by
tenants of the Building, all taxes and assessments for public improvements or
any other purpose and any gross receipts or receipts or similar taxes; and (3)
expenses (including, without limitation, attorneys' and consultants' fees and
court costs) incurred in reviewing, protesting or seeking a reduction of real
estate taxes, whether or not such protest or reduction is ultimately successful.
Subject to the foregoing, Real Estate Tax Expenses shall not include any (i)
inheritance, estate, gift, franchise, corporation, transfer, excise, net income
or net profits tax assessed against Landlord from the operation of the Building,
and (ii) penalties or interest for late payment of Real Estate Taxes, if Tenant
was then current on its payments of Real Estate Tax Expenses under this Lease.

 

EE.    Rent: All Base Rent and Additional Rent.

 

(1)         Base Rent: The amount payable by Tenant pursuant to Section 4.A.
below.

 

(2)         Additional Rent: All sums of money payable by Tenant pursuant to
this Lease other than Base Rent.

 

(3)         Monthly Rent: A monthly installment of Base Rent and Additional
Rent, if any, which shall equal one-twelfth (1/12th) of Base Rent and Additional
Rent then in effect.

 

FF.    Shared Lab Space. Tenant shall have a non-exclusive license to use a
shared laboratory area located on the second (2nd) floor of the Building (such
area being defined as the “Shared Lab Space”) in accordance with the terms and
conditions of this paragraph during the period in which Landlord continues
operation of the same. Landlord shall provide Tenant with written notice of any
revocation of the license granted to Tenant to use the Shared Lab Space at least
sixty (60) days prior to the effective date of termination of such license. Such
Shared Lab Space shall contain certain equipment, furnishings, systems, and
personal property, including a Hotpack Vertical Glassware Washer, Consolidated
Stills & Sterilizers, an Autoclave Ice Machine, and bench utilities (including,
but not limited to, deionized water, compressed air, and house vacuum)
(collectively, the “Shared Lab Systems”). Landlord agrees that so long as Tenant
has a license to use the Shared Lab Space, Landlord shall not remove any of the
Shared Lab Systems from the Shared Lab Space, except in connection with a repair
or replacement thereof. The license granted hereby is personal to Tenant and any
permitted assignee or subtenants of Tenant, and shall not be assigned or
otherwise pledged or transferred, directly or indirectly, without the consent of
Landlord, which may be granted or withheld in Landlord’s sole and absolute
discretion. Tenant’s use of the Shared Lab Systems shall be subject to such
rules and regulations as Landlord or its agent may promulgate and amend from
time to time upon reasonable prior notice to Tenant. Landlord shall use
commercially reasonable efforts to apply any new rules and regulations in a
non-discriminatory manner to all tenants in the Building.

 

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(1)         Landlord shall have the right at any time and from time to time in
the exercise of its sole and absolute discretion to reconfigure, relocate, or
modify the Shared Lab Space and to revise, expand, suspend, terminate, or
discontinue any of the Shared Lab Systems.

 

(2)         Tenant shall use the Shared Lab Space and the Shared Lab Systems so
as not to disturb other Building tenants, the Landlord or Landlord’s agents.
Landlord assumes no responsibility for enforcing Tenant’s rights or for
protecting the Shared Lab Space from any person or entity, including, but not
limited to, other tenants or occupants of the Building.

 

(3)         Landlord shall have no other obligation relating to the Shared Lab
Systems other than providing and servicing the same in its sole and absolute
subjective discretion during any period for which the Shared Lab Space is
operational and the costs thereof are being charged to Building tenants,
including Tenant, as part of the Operating Expenses; provided, however, that if
Tenant is then leasing and occupying all of the rentable area in the Building
Tenant may request in writing that Landlord discontinue providing any services
to the Shared Lab Space, in which event Landlord shall have no further
obligation to provide any services to the Shared Lab Space, such that costs of
operation of the Shared Lab Space shall not be included in Operating Expenses.
During any period of replacement, repair, or maintenance of the Shared Lab
Systems when they are not operational (including, but not limited to, any delays
thereto due to the inability to obtain parts or replacements), Landlord shall
have no obligation to provide Tenant with alternative, supplemental, temporary,
or back-up Shared Lab Systems. The terms and provisions of this paragraph shall
survive the expiration or earlier termination of this Lease.

 

(4)         Landlord makes no representations or warranties of any kind, express
or implied, with respect to the Shared Lab Space and Shared Lab Systems. Without
limiting the foregoing, Tenant expressly acknowledges and agrees that Landlord
does not guaranty or warrant that the Shared Lab Systems will be operational,
will be of sufficient capacity to accommodate Tenant’s use thereof, will be free
of Hazardous Materials, or will function or perform adequately, and Landlord
shall not be liable for any damages resulting from the failure of the Shared Lab
Systems.

 

(5)         Although the Shared Lab Space does not form a part of the Premises,
the provisions of this Lease (A) governing Tenant’s use, operation, and
enjoyment of the Premises, (B) imposing obligations on Tenant for matters
occurring in, on, within, or about the Premises or arising out of the use or
occupancy of the Premises (including, but not limited to, those obligations
relating to insurance, indemnification, Hazardous Materials Clearance (as
hereinafter defined), and environmental requirements), or (C) limiting
Landlord’s liability, shall apply with equal force to Tenant’s use of the Shared
Lab Space and the Shared Lab Systems.

 

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(6)         If a Default by Tenant occurs under Section 19 hereof, Landlord
shall have the right, in addition to any other rights and remedies available to
Landlord for a Default by Tenant, to terminate immediately Tenant’s license to
use the Shared Lab Space. The expiration or earlier termination of this Lease
shall automatically terminate the license hereby granted to Tenant to so use the
Shared Lab Space.

 

GG.    Tenant’s Key Executives: Merv Hamer (Vice President, Facilities and
Engineering), Barclay Philips (Senior Vice President, Chief Financial Officer
and Treasurer), John Herrmann (Senior Vice President, General Counsel and
Secretary), Jim White, and Tim Hahn.

 

HH.    Tenant's Personal Property: All equipment, improvements, furnishings
and/or other property now or hereafter installed or placed in or on the Premises
by and at the sole expense of Tenant or with Tenant's permission (other than any
property of Landlord), with respect to which Tenant has not been granted any
credit or allowance by Landlord, and which: (i) is removable without damage to
the Premises, the Building and the Land, (ii) does not diminish the relet or
sale value of the Building to other biotechnology or life sciences companies or
investors and (ii) is not a replacement of any property of Landlord, whether
such replacement is made at Tenant's expense or otherwise. Notwithstanding any
other provision of this Lease, Tenant's Personal Property shall not include any
improvements or other property installed or placed in or on the Premises as part
of Tenant's Work, whether or not any such property was purchased or installed at
Tenant's expense except that certain laboratory installations, including, but
not limited to, generators, switches, built-in plumbing, fume hoods, built-in
warm and cold rooms, deionized water, glass washers, autoclaves, chillers and
any related mechanical, electrical and plumbing equipment (collectively,
“Installations”) shall be deemed Tenant’s Personal Property during the Term, but
shall not be removed by Tenant at the expiration or earlier termination of this
Lease without Landlord’s prior written consent, which may be granted or withheld
in Landlord’s reasonable discretion.

 

II.    Tenant’s Work:       All work to be performed by Tenant pursuant to the
Work Agreement.

 

HH.    Unavoidable Delay: Any delays due to strikes, labor disputes, shortages
of material, labor or energy, acts of God, governmental restrictions, enemy
action, civil commotion, fire, unavoidable casualty or any other causes beyond
the control of Landlord or Tenant.

 

II.    Work Agreement; Exhibit D, the terms of which are hereby expressly
incorporated in this Lease.

 

2.    TERM.

 

A.     Term of Lease: The term of this Lease (the "Term") shall (a) with respect
to the Second Floor Premises, commence upon the execution and delivery of this
Lease by Tenant and Landlord (the "Lease Commencement Date"), and (b) subject to
the terms and conditions set forth in Section 2.C. hereof, with respect to the
First Floor Premises, commence on December 1, 2016 (the “First Floor Premises
Lease Commencement Date”), and shall terminate at 11:59 p.m. on November 30,
2026, or such earlier date on which this Lease is terminated pursuant to the
provisions hereof (the "Lease Expiration Date"). It is presently anticipated
that the Second Floor Premises will be delivered to Tenant within three (3)
business days after the date of full execution and delivery of this Lease by
Landlord and Tenant; provided, however, that if Landlord does not deliver
possession of the Second Floor Premises by such date, Landlord shall not have
any liability whatsoever, and this Lease shall not be rendered void or voidable,
as a result thereof; provided further that Tenant shall be entitled to one (1)
day of abatement of Base Rent for each day beyond the Lease Commencement Date
that Landlord has failed to deliver the Second Floor Premises to Tenant in
accordance with the terms of this Lease if the reason for such failure is other
than a delay caused by any Unavoidable Delay. Landlord hereby leases the
Premises to Tenant and Tenant hereby leases the Premises from Landlord for the
Term.

 

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B.     IBT Release. Landlord and Tenant acknowledge and agree that the First
Floor Premises are currently occupied by another tenant in the Building,
Integrated Biotherapeutics, Inc. (“IBT”), pursuant to the terms of a separate
lease between Landlord, as landlord, and IBT, as tenant (the “IBT Lease”). In
the event that (i) Landlord does not deliver possession of the First Floor
Premises on or before the First Floor Premises Lease Commencement Date, and the
reason therefor is not attributable to an Unavoidable Delay, then the First
Floor Premises Free Rent Period (as defined in Section 4.A hereof) shall be
extended by one (1) day for each day of delay until the First Floor Premises are
delivered to Tenant, and (ii) Landlord and IBT do not enter into an agreement to
amend the IBT Lease to terminate IBT’s rights to extend the term of the IBT
Lease with respect to the First Floor Premises beyond the First Floor Premises
Lease Commencement Date (the “IBT Release”) on or before the Outside Release
Date, then this Lease shall automatically terminate only with respect to the
First Floor Premises, and Landlord shall promptly return to Tenant any advanced
or prepaid rent paid with respect to the First Floor Premises, after which
neither party shall have any further obligations or liabilities to the other
with respect to the First Floor Premises. Landlord shall use commercially
reasonable efforts to obtain the IBT Release. In the event that IBT does not
enter into the IBT Release on or before the Outside Release Date, and provided
that Tenant does not terminate this Lease with respect to the First Floor
Premises pursuant to the terms of this Section 2.C., then, thereafter during the
Term of this Lease, Landlord shall not enter into any amendment to the IBT Lease
that would grant IBT the right to extend the term of the IBT Lease with respect
to the First Floor Premises beyond the expiration date of any extension period
contained in the IBT Lease as of the date of this Lease.

 

C.     Declarations: If requested by Landlord at any time during the Term,
Tenant promptly will execute a declaration in the form attached hereto as
Exhibit C.

 

D.     Effective Date: The rights and obligations set forth in this Lease,
except for the obligation to pay Rent and as otherwise specifically provided
herein to the contrary, shall become effective on the date of final execution of
this Lease.

 

3.    “AS-IS” CONDITION; TENANT’S WORK.

 

A.     As-Is Condition: Except as hereinafter provide in Section 3.A., Tenant
accepts the Second Floor Premises in their “as-is” condition as of the Lease
Commencement Date. Landlord shall have no obligation to make any other
improvements or alterations to the Second Floor Premises, and Tenant’s
possession of the Second Floor Premises shall be conclusive evidence of Tenant’s
acceptance of the Premises and its satisfaction as to the condition of the same.
Landlord shall deliver the Second Floor Premises and the First Floor Premises to
Tenant on the Lease Commencement Date or the First Floor Premises Lease
Commencement Date, respectively, with (i) all window systems in good and proper
working order, (ii) all Building mechanical, electrical (including any
electrical panels), sprinkler, fire alarm, HVAC and plumbing systems
(collectively, the “Base Building Systems”) in good working order, and (iii) the
base Building restrooms in compliance with all current applicable Laws existing
on the Lease Commencement Date, including, but not limited to, the ADA. Landlord
represents that all HVAC systems in the Building were designed to comply with
ASHRAE standards at the time of design and that to the best of Landlord’s
knowledge, based solely upon that certain letter dated January 6, 2015 from
Jennerik Engineering, Inc. to Scheer Partners (a copy of which letter has been
provided to Tenant), the mechanical systems are incompliance with ASHAE 62.1 as
of the date of said letter. Tenant acknowledges that, prior to the Lease
Commencement Date, the Second Floor Premises have been decommissioned as set
forth in that certain laboratory decommissioning report dated October 29, 2014,
prepared by Clym Environmental Services, LLC, a copy of which report has been
provided to Tenant, and Landlord makes no representation or warranty as to such
decommissioning of the Second Floor Premises. Subject to Section 6.B. below,
Landlord, at its sole cost, shall use commercially reasonable efforts to keep
the base Building systems, Common Areas, any public restrooms in the Building,
Building core stairwells, elevators and Building entry points in compliance with
the ADA (as hereinafter defined), and shall make repairs thereto after obtaining
written notice from a governmental agency of the need of such repairs; provided,
however, that Landlord shall have no obligation for ADA compliance with respect
to any portion of the foregoing (a) to the extent such items are located on a
floor of the Building if Tenant leases all of the rentable area on such floor in
its entirety by Tenant, or (b) if Tenant leases the Building in its entirety.

 

 8 

 

 

B.     Tenant’s Work. Tenant shall accept the First Floor Premises in their
“as-is” condition as of the First Floor Premises Lease Commencement Date. Tenant
shall improve the First Floor Premises in accordance with the Work Agreement
attached as Exhibit D. Landlord shall have no obligation to make any other
improvements or alterations to the First Floor Premises.

 

4.     RENT.

 

From and after the Lease Commencement Date, Tenant shall pay to Landlord Base
Rent and Additional Rent as are set forth in this Section 4 and in Section 5
below.

 

A.     Base Rent: Base Rent for the Premises shall be as follows:

 

(1)         Second Floor Premises Base Rent: Commencing on the Lease
Commencement Date, Tenant shall pay Second Floor Premises Base Rent in the
following amounts:

 

Lease Year  Rate of Second Floor
Premises Base Rent
Per Square Foot
Per Annum   Rate of Second Floor
Premises Base Rent
Per Annum   Second Floor 
Premises Monthly
Base Rent  1 (through 6/30/16)  $22.00   $427,460.00   $35,621.67  2
(7/1/16-6/30/17)  $22.55   $438,146.50   $36,512.21  3  $23.11   $449,027.30  
$37,418.94  4  $23.69   $460,296.70   $38,358.06  5  $24.28   $471,760.40  
$39,313.37  6  $24.89   $483,612.70   $40,301.06  7  $25.51   $495,659.30  
$41,304.94  8  $26.15   $508,094.50   $42,341.21  9  $26.80   $520,724.00  
$43,393.67  10  $27.47   $533,742.10   $44,478.51  11  $28.16   $547,148.80  
$45,595.73  12 (through 11/30/26)  $28.86   $560,749.80   $46,729.15 

 

 9 

 

 

Notwithstanding the foregoing, Landlord shall grant to Tenant a “rent holiday”
from the payment of the installments of Second Floor Premises Monthly Base Rent
for the period commencing on the Lease Commencement Date and ending on July 31,
2015 (the “Second Floor Premises Free Rent Period”). During such Second Floor
Premises Free Rent Period, the Second Floor Premises Monthly Base Rent shall be
abated (such rental abatement being hereinafter referred to as the “Second Floor
Premises Free Rent Allowance”); provided, however, that (i) the Second Floor
Premises Free Rent Period and the granting of the Second Floor Premises Free
Rent Allowance as provided hereunder shall not affect the Lease Commencement
Date pursuant to Section 2.A. hereof, (ii) Tenant shall remain obligated during
the Second Floor Premises Free Rent Period to perform all of Tenant’s
obligations under this Lease except as expressly set forth above (including, but
not limited to, the payment of all Additional Rent coming due under this Lease),
and (iii) in the event of any termination of this Lease by Landlord based upon a
Default hereunder by Tenant, the then unamortized portion of Second Floor
Premises Base Rent which would have otherwise been due and payable hereunder
during the Second Floor Premises Free Rent Period in the absence of the Second
Floor Premises Free Rent Allowance shall immediately become due and payable and
any remaining Free Rent Allowance hereunder shall be of no force or effect. If
the first day following the last day of the Second Floor Premises Free Rent
Period (such date being hereinafter referred to as the “Second Floor Premises
Rent Commencement Date”) is a date other than the first day of a month, then
Second Floor Premises Monthly Base Rent for the period commencing with and
including the Second Floor Premises Rent Commencement Date and ending on and
including the day prior to the first day of the following month shall be
prorated at the rate of one-thirtieth (1/30th) of the Second Floor Premises
Monthly Base Rent per day and shall be due and payable on the Second Floor
Premises Rent Commencement Date and the first full payment of Second Floor
Premises Monthly Base Rent shall be applied to the installment of Second Floor
Premises Monthly Base Rent which is payable for the first full month immediately
following the Second Floor Premises Rent Commencement Date.

 

(2)         First Floor Premises Base Rent: Commencing on October 1, 2017,
Tenant shall pay First Floor Premises Base Rent in the following amounts:

 

Time Period  Rate of First Floor Premises Base Rent
Per Square Foot
Per Annum   Rate of First Floor Premises Base Rent
Per Annum  

First Floor

Premises Monthly
Base Rent

  First Floor Premises Lease Commencement Date-6/30/17  $22.55   $237,316.20  
$19,776.35  7/1/17-6/30/18  $23.11   $243,209.64   $20,267.47  7/1/18-6/30/19 
$23.69   $249,313.56   $20,776.13  7/1/19-6/30/20  $24.28   $255,522.72  
$21,293.56  7/1/20-6/30/21  $24.89   $261,942.36   $21,828.53  7/1/21-6/30/22 
$25.51   $268,467.24   $22,372.27  7/1/22-6/30/23  $26.15   $275,202.60  
$22,933.55  7/1/23-6/30/24  $26.80   $282,043.20   $23,503.60  7/1/24-6/30/25 
$27.47   $289,094.28   $24,091.19  7/1/25-6/30/26  $28.16   $296,355.64  
$24,696.32  7/1/26-11/30/26  $28.86   $303,722.64   $25,310.22 

 

 10 

 

 

Notwithstanding the foregoing, Landlord shall grant to Tenant a “rent holiday”
from the payment of the installments of First Floor Premises Monthly Base Rent
for the period commencing on the First Floor Premises Lease Commencement Date
and ending on September 30, 2017 (the “First Floor Premises Free Rent Period”).
During such First Floor Premises Free Rent Period, the First Floor Premises
Monthly Base Rent shall be abated (such rental abatement being hereinafter
referred to as the “First Floor Premises Free Rent Allowance”); provided,
however, that (i) the First Floor Premises Free Rent Period and the granting of
the First Floor Premises Free Rent Allowance as provided hereunder shall not
affect the Lease Commencement Date pursuant to Section 2.A. hereof, (ii) Tenant
shall remain obligated during the First Floor Premises Free Rent Period to
perform all of Tenant’s obligations under this Lease except as expressly set
forth above (including, but not limited to, the payment of all Additional Rent
coming due under this Lease), and (iii) in the event of any termination of this
Lease by Landlord based upon a Default hereunder by Tenant, the then unamortized
portion of First Floor Premises Base Rent which would have otherwise been due
and payable hereunder during the First Floor Premises Free Rent Period in the
absence of the First Floor Premises Free Rent Allowance shall immediately become
due and payable and any remaining Free Rent Allowance hereunder shall be of no
force or effect. If the first day following the last day of the First Floor
Premises Free Rent Period (such date being hereinafter referred to as the “First
Floor Premises Rent Commencement Date”) is a date other than the first day of a
month, then First Floor Premises Monthly Base Rent for the period commencing
with and including the First Floor Premises Rent Commencement Date and ending on
and including the day prior to the first day of the following month shall be
prorated at the rate of one-thirtieth (1/30th) of the First Floor Premises
Monthly Base Rent per day and shall be due and payable on the First Floor
Premises Rent Commencement Date and the first full payment of First Floor
Premises Monthly Base Rent shall be applied to the installment of First Floor
Premises Monthly Base Rent which is payable for the first full month immediately
following the First Floor Premises Rent Commencement Date, Tenant shall pay Base
Rent to Landlord in equal monthly installments ("Monthly Base Rent") in advance
on the first day of each calendar month during the Term, without notice, except
that the first monthly installment of Base Rent shall be paid upon execution of
this Lease. If the Lease Commencement Date occurs on a date other than the first
day of a calendar month, Tenant shall receive a credit equal to the Monthly Base
Rent multiplied by the number of days in said calendar month prior to the Lease
Commencement Date and divided by the number of days in such month, which credit
shall be applied toward the installment of Monthly Base Rent next due hereunder.

 

B.     Payment: All Base Rent and Additional Rent due and payable to Landlord
under this Lease shall be paid to Landlord at the Landlord Payment Address.
Payments of Rent (other than in cash), if initially dishonored, shall not be
considered rendered until ultimately honored as cash by Landlord's depository.
Except as expressly set forth otherwise in this Lease, Tenant will pay all Rent
to Landlord without demand, deduction, set-off or counter-claim. If any sum
payable by Tenant under this Lease is paid by check which is returned due to
insufficient funds, stop payment order, or otherwise, then: (a) such event shall
be treated as a failure to pay such sum when due; and (b) in addition to all
other rights and remedies of Landlord hereunder, Landlord shall be entitled (i)
to impose, as Additional Rent, a returned check charge of Fifty Dollars ($50.00)
to cover Landlord's administrative expenses and overhead for processing, and
(ii) to require that all future payments be remitted by wire transfer, money
order, or cashier's or certified check.

 

C.     Late Fee: If Tenant fails to make any payment of Rent on or before the
date when payment is due, then Tenant also shall pay to Landlord a late fee
equal to five percent (5%) of the amount that is past due for each month or part
thereof until such Rent is fully paid. Said late fee shall be deemed
reimbursement to Landlord for its costs of carrying and processing Tenant's
delinquent account. Acceptance by Landlord of said late fee shall not waive or
release any other rights or remedies to which Landlord may be entitled on
account of such late payment.

 

 11 

 

 

D.     REIT/UBTI: Landlord and Tenant agree that no rental or other payment for
the use or occupancy of the Premises is or shall be based in whole or in part on
the net income or profits derived by any person or entity from the Building or
the Premises. Tenant further agrees that it will not enter into any sublease,
license, concession or other agreement for any use or occupancy of the Premises
which provides for a rental or other payment for such use or occupancy based in
whole or in part on the net income or profits derived by any person or entity
from the Premises so leased, used or occupied. Nothing in the foregoing
sentence, however, shall be construed as permitting or constituting Landlord's
approval of any sublease, license, concession, or other use or occupancy
agreement not otherwise approved by Landlord in accordance with the provisions
of Section 23 of this Lease.

 

5.    ADDITIONAL RENT.

 

A.     Sales, Use or Other Taxes or Traffic Mitigation Charges: If during the
Term any governmental authority having jurisdiction over the Building or the
Land levies, assesses or imposes any traffic mitigation charge or any tax on
Landlord, the Premises, the Building or the Land or the rents payable hereunder,
in the nature of a sales tax, use tax or any tax except (i) taxes on Landlord's
income, (ii) estate or inheritance taxes, or (iii) Real Estate Tax Expenses,
then Tenant shall pay its proportionate share of any such tax or traffic
mitigation charge to Landlord within fifteen (15) days after receipt by Tenant
of notice of the amount of such tax or traffic mitigation charge.

 

B.     To Cover Operating and Real Estate Tax Expenses:

 

(1)         Definitions: As used herein, "Tenant's Share of Operating Expenses"
shall be that percentage of Operating Expenses which is the equivalent of the
number of square feet of rentable area in the Premises (19,430 on the Lease
Commencement Date) divided by the number of square feet of rentable area of
office and lab space in the Building (52,790 on the Lease Commencement Date). As
used herein, "Tenant's Share of Real Estate Tax Expenses" shall be that
percentage of Real Estate Tax Expenses which is equivalent to the number of
square feet of rentable area in the Premises (19,430 on the Lease Commencement
Date) divided by the number of square feet of rentable area (both office and
lab) in the Building (52,790 on the Lease Commencement Date). Notwithstanding
the foregoing provisions of this Subsection 5.B.(1), in determining Tenant’s
Share of Operating Expenses for any calendar year, the portion of Operating
Expenses for such calendar year which constitute Controllable Operating Expenses
(as hereinafter defined) shall not exceed one hundred five percent (105%) of the
amount of Controllable Operating Expenses (as hereinafter defined) for the
immediately preceding calendar year (the “Controllable Operating Expenses
Cap”).As used herein, “Controllable Operating Expenses” shall mean all Operating
Expenses except for the following: (i) license and permit fees of any nature;
(ii) utility company charges; (iii) insurance premiums; (iv) the cost to remove
snow and ice; and (v) costs of compliance with governmental requirements.

 

(2)         Payment of Tenant's Share: Beginning on the Lease Commencement Date,
in addition to all other Rent set forth herein, for each calendar year during
the Term, Tenant shall pay to Landlord, as Additional Rent, on a monthly basis,
an amount equal to Tenant's Share of Operating Expenses and an amount equal to
Tenant's Share of Real Estate Tax Expenses. Notwithstanding anything contained
herein to the contrary, to the extent any portion of the Premises is then
subject to the First Floor Premises Free Rent Allowance or the Second Floor
Premises Free Rent Allowance, as applicable, Tenant's Share of Operating
Expenses and Tenant's Share of Real Estate Tax Expenses with respect to such
portion of the Premises shall not be greater, in the aggregate, than (a) with
respect to the period commencing on the Lease Commencement Date and ending on
December 31, 2015, Seven Dollars ($7.00) per square foot of rentable area, per
annum, (b) with respect to calendar year 2016, Seven and 18/100 Dollars ($7.18)
per square foot of rentable area per annum, and (c) with respect to the
applicable portion of calendar year 2017, Seven and 36/100 Dollars ($7.36) per
square foot of rentable area per annum (the “Pass-Through Cap”); provided,
however that the cost of utility charges that would otherwise be part of
Tenant's Share of Operating Expenses shall not be subject to the Pass-Through
Cap.

 

 12 

 

 

C.     Statements:

 

(1)          For each calendar year during the Term , Landlord shall deliver to
Tenant a statement estimating Tenant's Share of Operating Expenses and Tenant’s
Share of Real Estate Tax Expenses for such calendar year, which Tenant shall pay
in equal monthly installments in advance on the first day of each calendar month
during each calendar year. Tenant shall continue to pay such estimated Tenant’s
Share of Operating Expenses and Tenant’s Share of Real Estate Tax Expenses until
Tenant receives the next such statement from Landlord, at which time Tenant
shall commence making monthly payments pursuant to Landlord's new statement.
Landlord shall have the right to revise its estimate of Tenant’s Share of
Operating and Tenant’s Share of Real Estate Tax Expenses during any calendar
year.

 

D.     Retroactive Adjustments: After the end of each calendar year, Landlord
shall determine the actual Operating Expenses and Real Estate Tax Expenses for
such calendar year, Landlord shall calculate the foregoing sums and Landlord
shall provide to Tenant a statement of Tenant's Share of Operating Expenses and
Tenant’s Share of Real Estate Tax Expenses for the calendar year. Landlord shall
use commercially reasonable efforts to provide such statement to Tenant within
one hundred eighty (180) days following the end of each applicable calendar
year, but any failure to provide a statement within such 180-day period shall
not constitute a waiver by Landlord of Tenant’s obligation to pay such amounts
which are the subject of such statement. Within thirty (30) days after delivery
of any such statement, Tenant shall pay to Landlord (i) any deficiency between
the amount shown as Tenant's Share of Operating Expenses for the calendar year
and the estimated payments thereof made by Tenant and (ii) any deficiency
between the amount shown as Tenant’s Share of Real Estate Tax Expenses for the
calendar year and the estimated payments thereof made by Tenant. Tenant shall be
credited with any excess estimated payments toward subsequent Rent payments by
Tenant or, if the Term of this Lease has expired or been terminated, then
following Landlord’s determination of such overpayment by Tenant, Landlord shall
refund any excess estimated payments to Tenant within thirty (30) days after the
later to occur of (i) the date on which Tenant has cured all defaults under this
Lease, if any, or (ii) the date on which Tenant vacates the Premises.

 

E.     Change In or Contest of Taxes: In the event of any change by any taxing
body in the period or manner in which any of the Real Estate Tax Expenses are
levied, assessed or imposed, Landlord shall have the right, in its sole
discretion, to make equitable adjustments with respect to computing Real Estate
Tax Expenses. Real Estate Tax Expenses which are being contested by Landlord
shall be included in computing Tenant's Share of Real Estate Tax Expenses under
this Section 5, but if Tenant shall have paid Rent on account of contested Real
Estate Tax Expenses and Landlord thereafter receives a refund of such taxes,
Tenant shall receive a credit toward subsequent Rent payments in an amount equal
to Tenant's proportionate share of such refund or, if the Term of this Lease has
expired or been terminated, then following Landlord’s determination of such
overpayment by Tenant, Landlord shall refund any excess estimated payments to
Tenant within thirty (30) days after the later to occur of (i) the date on which
Tenant has cured all defaults under this Lease, if any, or (ii) the date on
which Tenant vacates the Premises.

 

 13 

 

 

F.     Audit Rights: Tenant shall have the right, at Tenant’s expense, to retain
a Qualified Consultant (as hereinafter defined), to examine the books and
records of Landlord relating to the Complex and Land upon at least thirty (30)
days’ prior notice and at reasonable times during normal business hours, so that
Tenant can determine that Tenant’s Share of Increased Operating Expenses and
Tenant’s Share of Increased Real Estate Tax Expenses have, in fact, been paid or
incurred and accurately applied by Landlord. Unless Tenant shall give Landlord a
notice objecting to the Landlord’s statement and specifying the respects in
which such statement is claimed to be incorrect within ninety (90) days after
its receipt of such statement, the statement shall be considered to be final and
accepted by Tenant. If Tenant disputes any such statement, Tenant shall pay all
Additional Rent set forth therein as a condition precedent to its right to
contest the same without prejudice to Tenant’s position. The term “Qualified
Consultant” shall mean an independent, certified public accounting firm or
auditing firm, or another qualified third-party consultant which has significant
experience in the field of pass-through audits for commercial office buildings
in the Washington, D.C. metropolitan area, and which firm or consultant is
reasonably approved by Landlord and is retained by Tenant on other than a
contingent fee basis.

 

G.     Arbitration: Unless otherwise mutually agreed, any dispute pertaining to
the statement described in Section 5.C. hereof shall be determined by
arbitration in the jurisdiction in which the Premises are located, in accordance
with the then current commercial rules of the American Arbitration Association.
The costs of the arbitration shall be divided equally between Landlord and
Tenant, except that each party shall bear the cost of its own legal fees and
accounting fees, unless (i) the arbitration results in a determination that
Landlord's statement contained a discrepancy of less than five percent (5%) in
Landlord's favor, in which event Tenant shall bear all costs incurred in
connection with such audit and arbitration, including, without limitation,
reasonable legal fees and accounting fees incurred by Landlord, or (ii) the
arbitration results in a determination that Landlord's statement contained a
discrepancy of five percent (5%) or more in Landlord's favor, in which event
Landlord shall bear all costs incurred in connection with such audit and
arbitration, including, without limitation, reasonable legal fees and accounting
fees incurred by Tenant. Pending determination of any dispute, Tenant shall pay
all amounts due pursuant to the disputed statement, but such payments shall be
without prejudice to Tenant's position. If it is determined that there was an
overpayment on the part of Tenant, then Tenant shall be entitled to a credit on
subsequent Rent payment(s) next coming due in an amount equal to such credit, or
if the Term has expired or been terminated, Landlord shall pay the amount of any
such credit to Tenant within thirty (30) days after the later to occur of (i)
the receipt by Landlord of any such refund of such taxes or (ii) the date of
Tenant’s cure of all defaults, if any, under this Lease.

 

H.     Tenant’s Personal Property: If any Taxes on Tenant’s Personal Property
are levied against Landlord or Landlord’s property, or if the assessed valuation
of the Project is increased by a value attributable to improvements, alterations
or equipment in 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 Real Estate Tax
Expenses to all tenants in the Project, Landlord shall have the right, but not
the obligation, to pay such Real Estate Tax Expenses. Landlord’s determination
of any excess assessed valuation shall be binding and conclusive, absent
manifest error. The amount of any such payment by Landlord shall constitute
Additional Rent due from Tenant to Landlord immediately upon demand therefor.

 

 14 

 

 

6.    USE.

 

A.     Permitted Use: Tenant shall use and occupy the Premises solely for
general office, research and development laboratory, vaccine or biological
manufacturing and other related purposes consistent with the character of the
Project and all applicable Laws (as hereinafter defined), and for no other
purpose.

 

B.     Legal and Other Restrictions of Tenant's Use: Tenant shall not use or
occupy the Premises for any unlawful purpose, or in any manner that will violate
the certificate of occupancy for the Premises or the Project or that will
constitute waste, nuisance or unreasonable annoyance to Landlord or any other
tenant or user of the Building, or in any manner that will increase the number
of parking spaces required for the Building or its full occupancy as required by
law. Tenant shall comply with all present and future laws (including, without
limitation, the Americans with Disabilities Act (the "ADA") and the regulations
promulgated thereunder, as the same may be amended from time to time), code,
ordinances (including without limitation, zoning ordinances and land use
requirements), regulations, orders and recommendations (including, without
limitation, those made by any public or private agency having authority over
insurance rates) (collectively, "Laws") concerning the use, occupancy and
condition of the Premises and all machinery, equipment, furnishings, fixtures
and improvements therein, all of which shall be complied with in a timely manner
at Tenant's sole expense. If any such Law requires an occupancy or use permit or
license for the Premises or the operation of the business conducted therein
(including a certificate of occupancy or nonresidential use permit), then Tenant
shall obtain and keep current such permit or license at Tenant's expense and
shall promptly deliver a copy thereof to Landlord. Use of the Premises is
subject to all covenants, conditions and restrictions of record. Landlord
represents to Tenant that to Landlord’s knowledge no covenants, conditions or
restrictions of record restrict the permitted use of the Premises. Tenant shall
not use any space in the Building for the sale of goods to the public at large
or for the sale at auction of goods or property of any kind. Tenant shall not
conduct any operations, sales, promotions, advertising or special events in, on
or about the Project outside of the Premises.

 

C.     Compliance with Laws. Notwithstanding anything contained herein to the
contrary, Landlord shall be responsible, at its sole cost and expense, for
compliance of the Common Areas, Land and Base Building Systems within the
Premises as the Premises exist on the date of execution of this Lease, with all
applicable federal, state and local laws, regulations and ordinances (including
any fire and life safety regulations and the Americans with Disabilities Act
(the “ADA”)) throughout the Term of this Lease. Tenant shall be responsible, at
its sole cost and expense, for compliance of the Premises (except for Base
Building Systems which are not affected by Tenant’s Work) with the ADA and all
applicable federal, state and local laws, regulations and ordinances.
Notwithstanding anything to the contrary contained in this Lease, Tenant shall
not be responsible for ensuring the Premises complies with law when (i) such
legal requirements are imposed on a building-wide basis; (ii) such legal
requirements do not relate to Tenant's particular manner of use of the Premises;
(iii) a notice of violation or order was issued prior to the date Tenant is
given possession of the applicable Premises; or (iv) such legal requirements
require investigating, certifying, monitoring, encapsulating, removing or in any
way dealing with asbestos or hazardous substances unless such asbestos or
hazardous substances were introduced into the Premises by or exacerbated Tenant.
In no event shall Tenant ever be responsible for making any capital expenditures
or structural changes under this Lease, unless such capital expenditures or
structural changes are required due to the actions or failures to act of Tenant.

 

 15 

 

 

7.    CARE OF PREMISES.

 

A.     Tenant’s Maintenance Obligations. Tenant shall at its expense keep the
Premises (including all improvements, fixtures and other property located
therein) in a neat and clean condition and in good order and repair, and will
suffer no waste or injury thereto. Tenant shall maintain all fixtures,
furnishings and equipment located in, or exclusively serving, the Premises in
clean, safe and sanitary condition, shall take good care thereof and make all
required repairs and replacements thereto. Tenant shall give Landlord prompt
written notice of any defects or damage to the structure of, or equipment or
fixtures in, the Project or any part thereof upon discovery of such defects or
damage. Tenant shall surrender the Premises at the end of the Term in accordance
with the requirements of this Lease and in as good order and condition as they
were in on the Lease Commencement Date, ordinary wear and tear and damage by
fire or other casualty excepted. In no event shall Tenant’s obligation to repair
the Premises extend to (i) repairs necessitated in whole or in part by the gross
negligence or willful misconduct of Landlord or its agents, employees or
contractors; (ii) repairs for which Landlord is responsible hereunder; or (iii)
repairs required as a result of Landlord’s failure to make repairs for which it
is responsible hereunder.

 

B.     Landlord’s Obligation to Maintain Base Building: Landlord agrees to use
commercially reasonable efforts to maintain the structural portions of the
Building (including, but not limited to, exterior demising walls, foundation,
windows, roof, garage and common areas that form a part of the Building) and the
Building’s operating systems (including, but not limited to, base Building
mechanical, electrical, life safety, heating, ventilation, air-conditioning,
plumbing, pipes and conduits) to a standard which is at least equal to the
standard of maintenance in other comparable buildings located in Gaithersburg,
Maryland, taking into account the size, age, class, location and method of
construction of the Building and of such other buildings, and shall make such
repairs thereto as become necessary as expeditiously as circumstances permit
after obtaining actual knowledge from any source of the need for such repairs,
all costs of which shall be included in Operating Expenses to the extent the
same constitute Operating Expenses, unless the need for any such maintenance or
repair is brought about by any act or omission of Tenant, its agents, employees
or invitees, in which event such repairs shall be made by Landlord at Tenant’s
sole cost and expense, subject to the mutual waiver of subrogation in Section 17
of this Lease. Landlord shall have no duty to Tenant to maintain or to make any
repairs or improvements to the Premises except as provided in this Lease.

 

8.    ALTERATIONS BY TENANT.

 

A.     Making of Alterations; Landlord's Consent: Tenant shall not make or
permit to be made any Alterations without the prior written consent of Landlord
both as to whether the Alterations may be made and as to how and when they will
be made. Notwithstanding the foregoing, Landlord shall not unreasonably withhold
or condition its consent to any non-structural, cosmetic Alteration which Tenant
may desire to make to the Premises; provided, however, that Landlord shall
retain sole and absolute discretion to withhold its consent to any Alteration,
whether structural or non-structural, which may, in the sole and absolute
judgment of Landlord (1) adversely affect the marketability of the Premises, (2)
exceed the capacity of, hinder the effectiveness of, interfere with the
electrical, mechanical, heating, ventilating, air conditioning, plumbing or
other systems of the Premises or the Project or which will be connected to any
of such systems, or (3) be visible from outside the Premises. Notwithstanding
the foregoing, Tenant shall have the right, after providing at least ten (10)
days prior written notice to Landlord, but without the necessity of obtaining
Landlord’s consent, to recarpet, repaint, or to make purely “cosmetic” or
“decorative” nonstructural Alterations in and to the Premises that (I) do not
fall within clauses (1) through (3) above, (II) do not require the issuance of a
building permit, and (III) do not cost, when aggregated with all other
Alterations made during the previous twelve (12) months, more than Ten Dollars
($10.00) per rentable square foot of the Premises.

 

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B.     Any Alterations shall be made at Tenant's expense, by contractors
approved by Landlord (which approval shall not be unreasonably withheld,
conditioned or delayed if (1) the contractor or subcontractor is properly
licensed, (2) neither Landlord nor any of its affiliates has had any prior
experience with such contractor or subcontractor which was unsatisfactory, and
(3) Landlord knows of no prior unsatisfactory experience that a third party has
had with such contractor or subcontractor), in a good, workmanlike and
first-class manner, and subcontractors and in accordance with complete plans and
specifications approved in advance in writing by Landlord (such approval not to
be unreasonably withheld, conditioned or delayed with respect to items not
affecting the structural components of the Building or any of the Building’s
operating systems), and only after Tenant: (i) has obtained all necessary
permits from governmental authorities having jurisdiction and has furnished
copies thereof to Landlord, (ii) has submitted to Landlord an architect's
certificate that the Alterations will conform to all applicable Laws, and
(iii) has complied with all other requirements reasonably imposed by Landlord,
including, without limitation, any requirements due to the underwriting
guidelines of Landlord's insurance carriers. Landlord's consent to any
Alterations and approval of any plans and specifications constitutes approval of
no more than the concept of these Alterations and not a representation or
warranty with respect to the quality or functioning of such Alterations, plans
and specifications. Tenant shall be and is solely responsible for the
Alterations and for the proper integration thereof with the Building, the
Building's systems and existing conditions. Landlord shall have the right, but
not the obligation, to supervise the making of any Alterations. All Alterations
involving structural, electrical, mechanical or plumbing work, lab equipment,
furniture or fixtures, the heating, ventilation and air conditioning system of
the Premises or the Building, and the roof of the Building, shall, at Landlord's
election, be performed by Landlord's designated contractor or subcontractor at
Tenant's expense. Tenant shall pay to Landlord as Additional Rent a construction
management fee in an amount equal to one percent (1%) of the cost of such work
(the “Oversight Fee”), plus, the actual out-of-pocket costs of any architectural
fees incurred by Landlord’s construction manager. If any Alterations which
require Landlord’s approval are made without the prior written consent of
Landlord, or which do not conform to plans and specifications approved by
Landlord or to other conditions imposed by Landlord pursuant to this Section 8,
Landlord may, in its sole discretion, correct or remove such Alterations at
Tenant's expense, including charging Tenant an Oversight Fee based on the costs
of such correction or removal. Following completion of any Alterations, at
Landlord's request, Tenant either shall deliver to Landlord a complete set of
"as built" plans showing the Alterations or shall reimburse Landlord for any
expense incurred by Landlord in causing the Building plans to be modified to
reflect the Alterations. All Alterations shall remain the property of Landlord
following the expiration of the Term, unless Landlord provides Tenant with
written notice requiring the removal of such Alterations at the time Tenant
requests Landlord’s consent to such Alterations in accordance with the terms of
Section 10 hereof.

 

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C.     No Liens: Tenant shall take all necessary steps to ensure that no
mechanic's or materialmen's liens are filed against the Premises, Building or
Project as a result of any Alterations made by the Tenant. If any mechanic's
lien is filed, Tenant shall discharge the lien within ten (10) business days
thereafter, at Tenant's expense, by paying off or bonding the lien. If Tenant
fails to discharge such lien within such 10-business day period, Landlord shall
have the right, but not the obligation, to pay such lien and require Tenant to
reimburse Landlord for all costs incurred thereto within ten (10) days of
demand. If Landlord gives its consent to the making of any Alteration, such
consent shall not be deemed to be an agreement or consent by Landlord to subject
its interest in the Premises or the Building to any liens which may be filed in
connection therewith, nor shall Landlord’s receipt of any fee in connection with
any Alterations or Tenant’s Work or Landlord’s payment of any allowance to
Tenant with respect to any work performed in or with respect to the Premises by
or on behalf of Tenant be deemed to constitute a basis for Landlord’s interest
in the Premises or the Building to be subjected to any lien. 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 the applicability of the lien only
to removable personal property, located in an identified suite leased by Tenant.

 

9.    EQUIPMENT.

 

A.     Equipment. Upon Tenant’s written request, and provided that Tenant is not
then occupying the entire Building, all electrical consumption used in the
Premises with respect to the Premises (including, but not limited to, when
possible, all costs of providing heating and air conditioning to the Premises)
shall be separately metered at Landlord’s cost, and Tenant shall pay the full
amount of such consumption directly to the providers thereof, and Tenant shall
pay, as part of Operating Expenses, its share of all charges for electrical
consumption, as reasonably determined by Landlord based on Tenant’s pro rata
share calculated on a per square foot basis for the Common Area and any vacant
space and non-metered space in the Building, with respect to electrical
components which are jointly metered among multiple tenants of the Building or
which are paid by Landlord for the Building and/or the Premises, provided,
however, that the cost of electricity provided to the Premises shall not be paid
twice by Tenant as a result of paying electrical costs both directly to the
providers based upon separate meters and to Landlord as part of Operating
Expenses.

 

B.     Permitted Equipment: Tenant shall not install or operate in the Premises
any equipment or other machinery that, in the aggregate, will cause Tenant to
use more than the Premises' Standard Electrical Capacity, without: (i) obtaining
the prior written consent of Landlord, who may condition its consent upon the
payment by Tenant of Additional Rent for additional consumption of utilities,
additional wiring or other expenses resulting therefrom, (ii) securing all
necessary permits from governmental authorities and utility companies and
furnishing copies thereof to Landlord, and (iii) complying with all other
requirements reasonably imposed by Landlord. Prior to the Lease Commencement
Date, Tenant shall provide Landlord with a list of all equipment that Tenant
intends to install or operate in the Premises which operate on more than one
hundred twenty (120) volts, and Tenant shall provide Landlord with an updated
list of such equipment prior to the installation or use of any additional
equipment which operates on more than one hundred twenty (120) volts. Tenant
shall not install any equipment or machinery which may necessitate any changes,
replacements or additions to or material changes in the use of water, heating,
plumbing, air conditioning, gas or electrical systems of the Building without
obtaining the prior written consent of Landlord, who may withhold or deny its
consent in its absolute discretion.

 

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C.     Payment For Excess Utility Usage: If Tenant's equipment shall result in
electrical demand in excess of the Premises' Standard Electrical Capacity,
Landlord shall have the right, in its sole discretion, to install additional
transformers, distribution panels, wiring and other applicable equipment at the
expense of Tenant. None of the equipment so installed shall be deemed to be
Tenant's Personal Property. If at any time during the Term, Tenant's connected
electrical load from its use of equipment and fixtures (including incandescent
lighting and power), as estimated by Landlord, exceeds the Premises' Standard
Electrical Capacity, then Landlord may, at its option: (i) install separate
electrical meter(s) for the Premises, or (ii) cause a survey to be made by an
independent electrical engineer or consulting firm to determine the amount of
electricity consumed by Tenant beyond the Premises' Standard Electrical
Capacity. Tenant shall reimburse Landlord for the reasonable out-of-pocket cost
of the installation of said meter(s) or completion of said meter(s) or survey,
and shall pay as Additional Rent the cost of any electricity in excess of an
average of the Premises Standard Electrical Capacity, at the rate charged by the
utility company providing such electricity, assuming continuous business hours,
within ten (10) days after receipt of any bill therefor from Landlord, or
Landlord may require Tenant to contract separately from the applicable utility
provider reasonably satisfactory to Landlord.

 

If Landlord shall determine that Tenant’s usage of any other utility constitutes
excess usage, Landlord shall have the right to (i) require Tenant to contract
separately from the applicable utility provider reasonably satisfactory to
Landlord and (ii) require Tenant to reimburse Landlord for the cost of any
excess water, sewer, gas and HVAC usage in the Premises. Excess usage shall mean
the excess of the estimated usage in the Premises (per square foot of rentable
area) during any billing period over the average usage (per square foot of
rentable area) during the same period for the entire Building, as reasonably
calculated by Landlord.

 

D.     Noise; Vibration; Floor Load: Business machines and equipment belonging
to Tenant, which cause noise or vibration that may be transmitted to any part of
the Building to such a degree as to be objectionable to Landlord or to any
tenant of the Building, shall be installed and maintained by Tenant at Tenant's
expense on devices that eliminate the noise and vibration. Tenant shall not
place any load upon the floor of the Premises which exceeds the five hundred
(500) pounds per square foot, or such other weight as Landlord may reasonably
prescribe.

 

E.     Landlord’s Generator: Landlord, at Landlord’s sole cost and expense,
shall maintain the existing emergency generator at the Building (the
“Generator”). The Generator shall have sufficient capacity to provide emergency
power as required by Laws for life safety during a power outage for Building
systems, including, but not limited to, all fire alarms, security access
control, domestic water, fire suppression, elevators, emergency lighting, and
other required systems. Tenant shall have the right to utilize a percentage of
the Generator’s capacity which is the equivalent to the number of square feet of
rentable area in the Premises divided by the aggregate number of square feet of
rentable area of office and lab space occupied by all tenants who have the right
to use the Generator. The costs of maintenance, repair, replacement and
operation of the Generator (including, but not limited to, all costs of
electrical consumption from such Generator) (the “Generator Costs”) shall be
included in Operating Expenses. Landlord shall have the right to relocate the
Generator to another area which shall permit the Generator to continue to serve
the Premises as it had prior to such relocation. The installation and placement
of the relocated Generator shall comply with all applicable Laws. Tenant
acknowledges and agrees that Landlord does not guarantee that the Generator will
be operational at all times or that emergency power will be available to the
Premises when needed.

 

 19 

 

 

F.     Tenant’s Generator. Landlord acknowledges that Tenant shall have the
right, at Tenant's option and at Tenant’s sole cost and expense, to install,
operate, maintain, repair and replace a supplemental generator, fuel tank or
both of same (collectively, the “Tenant’s Generator”) in a location (or
locations) on the existing empty pad near the Generator (the “Generator Space”)
and Tenant may use Tenant’s pro rata share of existing conduits for wire pulls;
provided, however, that (i) Tenant shall be solely responsible for all costs of
installation, maintenance, repair and replacement of the Tenant’s Generator,
(ii) Tenant shall be responsible for all costs of operation of such Tenant’s
Generator (including, but not limited to, all costs of electrical consumption
from such Tenant’s Generator), and (iii) Tenant’s installation work conducted in
connection with the installation of the Tenant’s Generator shall be subject to
Landlord’s prior written approval in accordance with the terms and conditions of
Section 8.A. hereof. Tenant shall comply with (a) Landlord's standard
requirements regarding Tenant’s use, operation and maintenance of the Tenant’s
Generator with respect to noise, vibration, and testing, and (b) with all Laws
with respect to screening of Tenant’s Generator. Landlord shall have the right,
in Landlord's reasonable judgment, by providing Tenant with prior written notice
and paying the reasonable cost of relocation of the Tenant’s Generator, to
relocate the Tenant’s Generator from the Generator Space to another area which
shall permit the Tenant’s Generator to continue to serve the Premises as it had
prior to such relocation. In addition, Landlord and Tenant acknowledge that the
installation of the Tenant’s Generator shall include the costs of demising the
Generator Space, if applicable, the costs of installation of connecting
conduits, and all actual costs of installation, operation, maintenance, repair,
replacement and removal of the Tenant’s Generator, all of which costs shall be
paid solely by Tenant (which costs may be paid from the Tenant Allowance). The
installation and placement of the Tenant’s Generator shall comply with all
applicable Laws. Prior to the Lease Expiration Date, Tenant shall restore the
Generator Space and any damage to the Land, the Building, the Premises or any
combination thereof, to their condition as of the Lease Commencement Date,
reasonable wear and tear excepted; provided, however, that Landlord shall have
the right, in its sole and absolute discretion, to retain possession of the
Tenant’s Generator upon the expiration or earlier termination of this Lease, in
which event Tenant shall have no obligation to remove the Tenant’s Generator,
and the Tenant’s Generator shall become the property of Landlord from and after
the Lease Expiration Date.

 

10.  OWNERSHIP AND REMOVAL OF PROPERTY.

 

A.     Landlord's Property: Any Alterations and other improvements and any
equipment, machinery, furnishings and other property, installed or located in
the Premises or Project by or on behalf of Landlord or Tenant, except for
applicable Tenant's Personal Property: (i) shall immediately become the property
of Landlord, and (ii) shall be surrendered to Landlord with the Premises as a
part thereof at the end of the Term; provided, however, that if Landlord
requests Tenant to remove any Alterations installed by or on behalf of Tenant,
Tenant shall cause the same to be removed at Tenant's expense on or before the
Lease Expiration Date or earlier termination of this Lease, or shall reimburse
Landlord for the cost of such removal, as elected by Landlord (unless Landlord
expressly waives in writing the right to require such removal at the time
Landlord gives its consent to the making of such Alterations). Notwithstanding
the foregoing, Tenant, upon submitting its request to Landlord to make
Alterations, shall have the right to request therein that Landlord specify
whether and to what extent Landlord will require Tenant to remove the
Alterations in question at the end of the Term, provided that Tenant refers
therein to the provisions of this Section 10.A. If Tenant shall fail to request
such information in its request to make any Alterations, such right shall be
deemed null and void as to the Alterations in question, and all such Alterations
shall thereafter be subject to the exercise of Landlord’s rights and to Tenant’s
obligations set forth in this Section 10.A. If Tenant submits its request for
such information in accordance with the foregoing provisions and Landlord
consents to the Alterations requested, Landlord shall, together with its
consent, specify in writing whether and to what extent it will require Tenant to
remove the Alterations in question at the end of the Term, and if Landlord fails
so to specify, Tenant shall have no further obligation to remove the Alterations
which were the subject of Tenant’s request.

 

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B.     Removal of Property At End of Term: Tenant shall remove all of Tenant's
Personal Property (except as provided in Section 1 CC. herein), and all computer
cabling and wiring installed by or on behalf of Tenant (irrespective of whether
such cabling and wiring constitutes Tenant's Personal Property under the terms
of this Lease, and at Tenant's expense, using a contractor approved in advance
by Landlord in writing, which approval shall not be unreasonably withheld,
conditioned or delayed if (1) the contractor or subcontractor is properly
licensed, (2) neither Landlord nor any of its affiliates has had any prior
experience with such contractor or subcontractor which was unsatisfactory, and
(3) Landlord knows of no prior unsatisfactory experience that a third party has
had with such contractor or subcontractor), from the Building and the Land on or
before the Lease Expiration Date. Any personal property belonging to Tenant or
to any other person or entity which is left in the Building or on the Land after
the date this Lease is terminated for any reason shall be deemed to have been
abandoned. In such event, Landlord shall have the right to store such property
at Tenant's sole cost and/or to dispose of it in whatever manner Landlord
considers appropriate, without waiving its right to claim from Tenant all
expenses and damages caused by Tenant's failure to remove such property, and
Tenant and any other person or entity shall have no right to compensation from
or any other claim against Landlord as a result. Notwithstanding the foregoing,
Landlord shall not require Tenant to remove (x) any initial Alterations which
are performed in the applicable portion of the Premises as of the Lease
Commencement Date, the First Floor Premises Lease Commencement Date, or the
Second Floor Premises Lease Commencement Date (as applicable), or (y) any
Alterations which constitute improvements which are typically found in
businesses conducting only an office and laboratory use and other incidental
uses in buildings which are comparable to the Building (the "Typical
Non-Structural/Non-System Office/Lab Improvements") (such items which are
excluded from being Typical Non-Structural/Non-System Office/Lab Improvements
being hereinafter referred to as "Items Subject to Removal"). Items Subject to
Removal shall include, but not be limited to, any raised flooring (i.e.,
flooring which is raised above the concrete slab, with a cavity between the
raised flooring and the concrete slab), cafeteria improvements, catering
kitchens (not including pantries), internal stairwells, computer server rooms,
and any other similar non-standard office or laboratory installations within the
Premises. Notwithstanding the foregoing or anything to the contrary contained in
this Lease, in the event that as part of Tenant’s obligations set forth in
Section 40 hereof (captioned “Surrender”), Tenant is required to repair, remove
or replace certain components of the Premises or the Building, then Tenant shall
perform such repair, removal or replacement, regardless of whether or not such
item constitutes an initial improvement, Typical Non-Structural/Non-System
Office/Lab Improvements or an Item Subject to Removal.

 

11.  LANDLORD'S ACCESS TO PREMISES.

 

Landlord may at any reasonable time enter the Premises to examine them, to make
alterations or repairs thereto or for any other purposes which Landlord
considers necessary or advisable; however, in the case of any emergency,
Landlord and its agents may enter the Premises at any time and in any manner.
Tenant shall allow the Premises to be exhibited by Landlord: (i) at any
reasonable time to representatives of lending institutions or to prospective
purchasers of the Building, and (ii) at any reasonable time to persons who may
be interested in leasing the Premises. Landlord reserves the right and shall be
permitted reasonable access to the Premises to install facilities within and
through the Premises and to install and service any systems deemed advisable by
Landlord to provide services or utilities to any tenant of the Building.
Landlord agrees to provide the Tenant with at least 48 hours prior notice
(except in the event of an emergency, in which event not notice shall be
required), which notice may be given verbally, prior to entering the Premises
pursuant to this Section 11. Landlord agrees to use commercially reasonable
efforts not to interfere with the conduct of Tenant’s ordinary business
operations in the Premises during any access of the Premises by Landlord.

 

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12.  SERVICES AND UTILITIES.

 

A.     Services Provided: Landlord shall provide the following services to
Tenant, at Tenant’s expense, except as otherwise provided herein (including, but
not limited to, as provided in Sections 5, 9.A. and 1.BB. hereof):

 

(1)         Central heating and air conditioning commensurate with central
heating and air conditioning service provided to comparable buildings during
Building Hours, exclusive of Holidays, during the seasons of the year and within
the temperature ranges usually furnished in comparable office and lab buildings
in the local jurisdiction in which the Building is located. Landlord shall
provide heat and air conditioning at other times at Tenant's expense, provided
that Tenant gives Landlord notice by 1:00 p.m. on weekdays for after-hour
service on the next weekday, two (2) business days' notice before a Holiday for
service on such Holiday and two (2) business days' notice for after-hour service
on Saturday or Sunday. Landlord shall charge Tenant for such after-hour, Holiday
and special weekend service at Landlord’s “Actual Cost,” which is defined as the
sum of the actual costs incurred by Landlord in providing after-hours HVAC
service, including Landlord’s direct costs, engineering labor costs, applicable
depreciation and repair and maintenance costs directly related to and only to
the extent of the increased utilization of equipment to provide the service, and
Landlord’s reasonable estimate of related administrative costs for such service.
Landlord shall provide Tenant with reasonable details of how such costs were
determined and allocated to Tenant. At all times, Landlord shall provide
electrical facilities to furnish electricity up to the Premises' Standard
Electrical Capacity and gas, if installed as part of Tenant’s Work.
Notwithstanding the foregoing, Landlord, at its option, may discontinue such
service by installing, at Landlord’s expense, a submeter to serve the Premises,
and either (i) require Tenant to contract separately with a utility provider
reasonably acceptable to Landlord for such electricity or gas or (ii) in the
case of a joint submeter, charge Tenant for its share, as reasonably determined
by Landlord, for its consumption of any utilities. Following the installation of
a submeter exclusively serving the Premises, Landlord will no longer be
responsible for furnishing electricity, gas or other utility to the Premises
that are separately sub-metered.

 

(2)         [Intentionally Omitted.]

 

(3)         Cleaning and char services for the Common Areas in Landlord's
standard manner.

 

(4)         Tenant shall contract separately to clean and remove waste daily
(excluding weekends and Holidays) and as otherwise necessary from the entire
Premises, including the office and laboratory areas, floors, windows, fixtures
and equipment, in a manner consistent with the Building.

 

(5)         Routine maintenance for all Common Areas of the Building in such
manner as Landlord deems reasonable.

 

(6)         Reasonable access to the Premises twenty-four (24) hours per day,
seven (7) days per week, fifty-two (52) weeks per year, subject to such access
control procedures, restrictions and other regulations as Landlord may
promulgate.

 

(7)         One (1) Building engineer at the Building during Building Hours.

 

B.     Failure to Provide Services: Landlord shall have no liability to Tenant
or others based on any failure by Landlord to furnish the foregoing, due to
Unavoidable Delays, repair or maintenance work or any other reason, and such
failure shall neither render Landlord liable for damages to either person or
property, nor be construed as an eviction of Tenant, nor cause a diminution or
abatement of Rent nor relieve Tenant of any of Tenant's obligations hereunder.
Notwithstanding the foregoing, if any of the services to be provided by Landlord
pursuant to this Section 12 is suspended and such suspension renders the
Premises untenantable and continues for more than five (5) consecutive business
days, if the reason for the suspension or the continuation of the suspension is
anything other than an Unavoidable Delay, all Monthly Base Rent and Additional
Rent due pursuant to Section 5.B. hereof shall be abated for the period
commencing on the sixth (6th) consecutive business day of such suspension and
concluding on the date that the service has been restored.

 

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C.     Conservation: Tenant hereby agrees to comply with all energy conservation
procedures, controls and requirements instituted by Landlord pursuant to any
government regulations or otherwise, including but not limited to controls on
the permitted range of temperatures, the volume of energy consumption or the
hours of operation of the Building. Institution by Landlord of such controls and
requirements shall not entitle Tenant to terminate this Lease or to an abatement
of any Rent payable hereunder.

 

D.     Recycling: Without limiting the foregoing, Tenant covenants and agrees,
at its sole cost and expense, to comply with all present and future Laws of the
jurisdiction in which the Building is located and of the federal, municipal, and
local governments, departments, commissions, agencies and boards having
jurisdiction over the Building to the extent that any of them impose on Tenant
duties and responsibilities regarding the collection, sorting, separation, and
recycling of trash. Tenant shall pay all costs, expenses, fines, penalties, or
damages that may be imposed on Landlord or Tenant by reason of Tenant's failure
to comply with the provisions of this Section 12.D., and, at Tenant's sole cost
and expense, shall indemnify, defend and hold Landlord harmless (including legal
fees and expenses) from and against any actions, claims, and suits arising from
such noncompliance, using counsel reasonably satisfactory to Landlord.

 

13.  RULES AND REGULATIONS.

 

Tenant shall abide by and observe the rules and regulations attached hereto as
Exhibit E and such other rules and regulations as may be made by Landlord from
time to time. Nothing contained in this Lease or in any rules and regulations
shall be interpreted to impose upon Landlord any obligations to enforce against
any tenant its rules and regulations, or the provisions of any lease with any
other tenant, and Landlord shall not be liable to Tenant or any other entity for
any violation of said rules, regulations or lease provisions. In the event of
any conflict between this Lease and any rules and regulations, the terms of this
Lease shall govern.

 

14.  REPAIR OF DAMAGE CAUSED BY TENANT: INDEMNIFICATION.

 

A.     Repairs: Except as otherwise expressly provided in this Lease and subject
to the mutual waiver of subrogation in Section 17 of this Lease, all injury,
breakage and damage to the Land, the Building or the Premises, caused by any act
or omission of Tenant shall be repaired by and at the sole expense of Tenant,
except Landlord shall have the right, at its option, to make such repairs and to
charge Tenant for all costs and expenses incurred in connection therewith as
Additional Rent payable within ten (10) days after the rendering of a bill
therefor. Tenant shall notify Landlord reasonably promptly of any injury,
breakage or damage to the Land, the Building, or the Premises caused by Tenant.

 

B.     Indemnification: Subject to the mutual waiver of subrogation in Section
17 of this Lease, Tenant hereby agrees to indemnify and hold Landlord harmless
from and against all costs, damages, claims, liabilities and expenses, including
reasonable attorneys' fees, suffered by or claimed against Landlord, directly or
indirectly (except to the extent caused by the gross negligence or willful
misconduct of Landlord or its agents or employees) from any bodily injury, death
or property damage to the extent arising from: (i) Tenant's use and occupancy of
the Premises or the business conducted by Tenant therein or Tenant's presence in
the Building or on the Land, (ii) the making by Tenant of any Alterations,
(iii) any act or omission of Tenant or its employees, agents or invitees, and
(iv) any breach or default by Tenant in the observance or performance of its
covenants and obligations under this Lease.

 

 23 

 

 

15.  LIMITATION ON LANDLORD LIABILITY.

 

A.     Liability Standard: Landlord shall not be liable to Tenant or any other
individual or entity for any damage, loss or claim whatsoever, except damages,
losses and claims that are the direct result of Landlord's negligence or willful
misconduct; however, in no event shall Landlord be liable for consequential
damages or any loss, damage or injury relating to Tenant’s Personal Property,
including without limitation, Tenant’s Installations, animals, products,
research, experiments, samples, business, accounting or any other records.

 

B.     Limitation on Total Liability: Notwithstanding any other provision of
this Lease, it is expressly understood and agreed that the total liability of
Landlord arising out of or in connection with this Lease, the relationship of
Landlord and Tenant hereunder and/or Tenant's use of the Premises, shall be
limited to the estate of Landlord in the Building. No other property or assets
of Landlord or any partner or owner of Landlord shall be subject to levy,
execution, or other enforcement proceedings or other judicial process for the
satisfaction of any judgment or any other right or remedy of Tenant arising out
of or in connection with this Lease, the relationship of Landlord and Tenant
hereunder and/or Tenant's use of the Premises.

 

C. Mutual Waiver of Consequential Damages: Notwithstanding any provision of this
Lease to the contrary (including, without limitation, any indemnification
provision), in no event shall Landlord, Tenant or any of their members,
partners, directors, officers, shareholders, employees, advisers or agents be
responsible for interruption or loss of business, income or profits, or any
other consequential, indirect or special damages, except to the extent of any
consequential, indirect or special damages arising from Tenant’s violation of
its obligations set forth in Sections 21 or 36 hereof.

 

16.  FIRE AND OTHER CASUALTY.

 

If the Premises shall be damaged by fire or other casualty, other than as a
result of the gross negligence or willful misconduct of Tenant, this Lease shall
not terminate and, upon adjustment of insurance claims, Landlord shall repair
the damage, provided that Landlord shall have no obligation to repair damage to
or replace Tenant's Personal Property. Subject to the foregoing, no compensation
or reduction of Rent shall be paid or allowed for inconvenience, annoyance or
injury to Tenant or Tenant's business arising from any damage to or repair of
the Premises or the Building.

 

Tenant, at its expense, shall promptly perform, subject to delays arising from
the collection of insurance proceeds, Unavoidable Delay or obtaining approval
from any applicable governmental authority having jurisdiction over Hazardous
Materials to restore the Premises (“Hazardous Material Clearances”), all repairs
or restoration not required to be done by Landlord and shall promptly re-enter
the Premises and commence doing business in accordance with this Lease.
Notwithstanding anything to the contrary in this Lease, provided Tenant fully
and promptly cooperates with Landlord, following written or verbal notice to
Tenant, with all reasonable procedures Landlord deems reasonably necessary for
Landlord to obtain such Hazardous Materials Clearances, Rent shall be abated
from the date of such casualty 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 for the temporary
conduct of Tenant’s business. Such abatement shall be the sole remedy of Tenant
and Tenant waives any right to terminate this Lease by reason of damage or
casualty loss.

 

 24 

 

 

Notwithstanding anything herein to the contrary, if (1) insurance proceeds are
insufficient to pay the full cost of such repair and restoration, (2) the holder
of any Mortgage fails or refuses to make insurance proceeds available for such
repair and restoration, (3) zoning or other applicable Laws do not permit such
repair and restoration, or (4) the Building is damaged by fire or casualty
(whether or not the Premises has been damaged) to such an extent that Landlord
decides, in its sole and absolute discretion, not to rebuild or reconstruct the
Building, then Landlord, at its option, may give Tenant, within sixty (60) days
after the casualty, written notice of termination of this Lease, and this Lease
and the Term shall terminate (whether or not the Term has commenced) upon the
expiration of thirty (30) days from the date of the notice, with the same effect
as if the new expiration date had been the Lease Expiration Date.

 

If the restoration of the Premises and the Building has not been completed by
the two hundred seventieth (270th) day following the date of the casualty,
Tenant may terminate this Lease by written notice to Landlord, which notice
shall be given by Tenant, if at all, within ten (10) days following such two
hundred seventieth (270th) day.

 

If the Premises or the Building shall be damaged by fire or other casualty due
to the gross negligence or willful misconduct of Tenant: (i) Landlord shall have
no obligation to repair the Premises or the Building, (ii) this Lease shall, at
Landlord's option, not terminate, , and (iii) subject to the provisions of
Section 17 hereof, Landlord may pursue any legal and equitable remedies
available to it, except a suit for monetary damages.

 

17.  INSURANCE.

 

A.     Tenant's Insurance: [

 

(a)    Throughout the Term, Tenant shall obtain and maintain (1) commercial
general liability insurance (written on an ISO occurrence form or equivalent
basis) including contractual liability coverage insuring the obligations assumed
by Tenant under this Lease (including those set forth in Sections 14.B. and
36.B.), premises and operations coverage, broad form property damage coverage
and independent contractors coverage, and containing an endorsement for personal
injury, (2) business interruption insurance, (3) special cause of loss business
property insurance covering all leasehold improvements in the Premises and
Tenant's business personal property, stock, and, if applicable, inventory, (4)
comprehensive automobile liability insurance (covering automobiles owned or
leased by Tenant, if any), and (5) worker's compensation insurance and
employer's liability insurance. Such commercial general liability insurance
shall be in minimum amounts typically carried by prudent tenants engaged in
similar operations, but in no event shall be in an amount less than Two Million
Dollars ($2,000,000.00) combined single limit per occurrence with a Four Million
Dollars ($4,000,000.00) annual aggregate, and Tenant shall also obtain and
maintain umbrella excess liability insurance with a policy limit of not less
than Two Million Dollars ($2,000,000.00). Such business interruption insurance
shall be in an amount equal to Tenant's gross earnings for the then most
recently expired twelve (12) month period, but in no event shall be in an amount
less than the Base Rent then in effect during any Lease Year. Such property
insurance shall be in an amount not less than that required to replace all of
the original tenant improvements installed in the Premises pursuant to Exhibit B
attached hereto and made a part hereof, all Alterations and all other contents
of the Premises (including, without limitation, Tenant's trade fixtures,
decorations, furnishings, equipment and personal property). Such automobile
liability insurance shall be in an amount not less than One Million Dollars
($1,000,000.00) bodily injury and property damage for each accident. Such
worker's compensation insurance shall carry minimum limits as defined by the law
of the jurisdiction in which the Building is located (as the same may be amended
from time to time) but not less than Five Hundred Thousand Dollars ($500,000.00)
for each accident. Such employer's liability insurance shall be in an amount not
less than One Hundred Thousand Dollars ($100,000.00) for each accident, Five
Hundred Thousand Dollars ($500,000.00) per person for illness or disease-policy
limit, and One Hundred Thousand Dollars ($100,000.00) disease each employee.

 

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(b)    All insurance carried by Tenant pursuant to Section 17.A.(a) hereof
shall: (1) be issued by a company that is licensed to do business in the
jurisdiction in which the Building is located, that has been approved in advance
by Landlord and that has a rating equal to or exceeding A:XI from Best's
Insurance Guide; (2) name Landlord, the managing agent of the Building and the
holder of any Mortgage as additional insureds/loss payees (as applicable); (3)
contain an endorsement that such policy shall remain in full force and effect
notwithstanding that the insured may have waived its right of action against any
party prior to the occurrence of a loss; (4) provide that the insurer thereunder
waives all right of recovery by way of subrogation against Landlord, its
partners, agents including, but not limited to, Landlord’s managing agent,
employees, and representatives, in connection with any loss or damage covered by
such policy; (5) be acceptable in form and content to Landlord; (6) be primary
and non-contributory; (7) contain an endorsement for cross liability and
severability of interests; (8) contain an endorsement prohibiting cancellation,
failure to renew, reduction of amount of insurance or change in coverage without
the insurer first giving Landlord and any Mortgagee thirty (30) days' prior
written notice (by certified or registered mail, return receipt requested) of
such proposed action and (9) contain a hostile fire endorsement and a
contractual liability endorsement. No such policy shall contain any deductible
provision except as otherwise approved in writing by Landlord, which approval
shall not be unreasonably withheld. Landlord reserves the right from time to
time to require Tenant to obtain higher minimum amounts or different types of
insurance if it becomes customary for other landlords of first-class office
buildings in the Washington, D.C., metropolitan area to require similar sized
tenants in similar industries to carry insurance of such higher minimum amounts
or of such different types of insurance. Tenant shall deliver a certificate (on
Acord Form 27) of all such insurance and receipts evidencing payment therefor
(and, upon request, copies of all required insurance policies, including
endorsements and declarations) to Landlord concurrently with Tenant's execution
of this Lease and at least annually thereafter. Tenant shall give Landlord
immediate notice in case of fire, theft or accident in the Premises, and in the
case of fire, theft or accident in the Building if involving Tenant, its agents,
employees or Invitees. Neither the issuance of any insurance policy required
under this Lease nor the minimum limits specified herein shall be deemed to
limit or restrict in any way Tenant's liability arising under or out of this
Lease.

 

(c)       Tenant shall require any contractor of Tenant performing work on the
Premises to carry and maintain at no expense to Landlord, a non-deductible:

 

(i)    Commercial general liability insurance policy, including (but not limited
to) contractor's liability coverage, contractual liability coverage, completed
operations coverage, broad form property damage endorsement and contractor's
protective liability coverage, to afford protection with respect to personal
injury, death or property damage of not less than Three Million Dollars
($3,000,000) per occurrence combined single limit/Three Million Dollars
($3,000,000) general aggregate (but not less than $3,000,000 per location
aggregate);

 

 26 

 

 

(ii)         Comprehensive automobile liability insurance policy with a combined
single limit for each occurrence of not less than One Million Dollars
($1,000,000) with respect to personal injury or death and property damage; and

 

(iii)       Worker’s compensation insurance policy or similar insurance in form
and amounts required by law. Such policy shall provide a waiver of subrogation
in favor of Tenant and Landlord.

 

B.     Landlord's Insurance: Landlord agrees to carry and maintain special cause
of loss property insurance (with replacement cost coverage) covering the
Building and Landlord's property therein in an amount required by its insurance
company to avoid the application of any coinsurance provision. Landlord shall
use reasonable efforts to secure a waiver of subrogation endorsement from its
insurance carrier. Landlord also agrees to carry and maintain commercial general
liability insurance in limits it reasonably deems appropriate.

 

C.     Effect of Tenant's Activities on Insurance: Tenant shall not conduct or
permit to be conducted any activity, or place any equipment in or about the
Land, the Building or the Premises which will increase the rate of, or make void
or voidable, any fire or other insurance maintained or required to be maintained
by Landlord or any Mortgagee on the Building, the Land or the property kept
thereon or therein, which will conflict with the provisions of any such
insurance policy or which will make it impracticable for Landlord to obtain
insurance covering any risks against which Landlord reasonably deems it
advisable to obtain insurance. In the event any increases in the rates of such
insurance are, in Landlord's reasonable judgment, due to Tenant's presence in
the Building, to any activity conducted or property installed or placed by
Tenant on or about the Land, the Building or the Premises or to Alterations
installed by Tenant or at Tenant's request, Tenant shall reimburse Landlord for
the amount of such increases promptly upon demand therefor. Statements by the
applicable insurance company or insurance rating bureau that such increases are
due to any of Tenant's activity, property or improvements shall be conclusive
for the purposes of determining Tenant's liability hereunder.

 

D.     Mutual Waiver of Subrogation. Notwithstanding anything to the contrary
contained in this Lease, Landlord and Tenant each hereby waives on behalf of
itself and its property insurers (none of which shall ever be assigned any such
claim or be entitled thereto due to subrogation or otherwise) any and all rights
of recovery, claim, action, or cause of action against the other, its agents,
officers, servants, partners, shareholders, contractors or employees for any
loss or damage that may occur to the Building, Property or Premises, or any
improvements thereto, or any personal property of such party therein, by reason
of fire, the elements, or any other cause or origin, which is insured against
under any property insurance policy actually being maintained from time to time,
even if not required hereunder, or which would be insured against under the
terms of any so-called "all risk" policy of property insurance, whether or not
such insurance coverage is actually being maintained and regardless of the cause
or origin, including, in every instance, negligence by the other party hereto,
its agents, officers, partners or employees. Landlord and Tenant each agrees to
cause appropriate clauses to be included in its property insurance policies
necessary to implement the foregoing provisions.

 

E.     Termination Right: Landlord shall have the right to terminate this Lease
upon thirty (30) days notice to Tenant in the event Landlord receives notice
from any of Landlord's insurance carriers that such carrier intends to cancel
its insurance on the Building, or to increase the cost of such insurance by more
than one hundred percent (100%) above the premium payable by Landlord
immediately prior to such notice, due to the activities of Tenant or the
presence of Tenant in the Building. However, Landlord shall not terminate this
Lease (i) if Tenant is using the Premises in accordance with the permitted use
under this Lease and in compliance with all applicable Laws, or (ii) in the
event Landlord is able, with good faith efforts, to obtain equivalent insurance
from an insurance carrier satisfactory to Landlord at a premium not more than
one hundred percent (100%) greater than the premium for the cancelled insurance;
provided that Tenant shall reimburse Landlord for all additional premiums
charged to Landlord by such new insurance carrier. It is expressly understood
that Landlord shall not have the right to terminate this Lease pursuant to this
Section 17.D. if any cancellation or rate increase is due to factors generally
applicable to the insurance or rental market, rather than to Tenant's activities
or presence in the Building.

 

 27 

 

 

18.  CONDEMNATION.

 

A.     Landlord's Right to Terminate: If a substantial part of the Premises, the
Building or the Land is taken or condemned by any governmental or
quasi-governmental authority for any purpose or is granted to any authority in
lieu of condemnation (collectively, a "taking"), Landlord and Tenant shall each
have the right in to terminate this Lease by written notice to the other party,
and upon the giving of such notice, the Term shall terminate as of the date
title vests in the authority, and Base Rent and Additional Rent payable pursuant
to Section 5 hereof shall be abated as of that date. For purposes of this
Section 18, a substantial part of the Premises, the Land or the Building shall
be considered to have been taken if, (i) in the sole opinion of Landlord, the
taking shall render it commercially undesirable for Landlord to permit this
Lease to continue or to continue operating the Building, or (ii) the taking
shall prohibit Tenant from operating its business in the Premises in the same
manner as it was conducted prior to such taking.

 

B.     Adjustment of Rent: If a portion of the Premises is taken and Landlord
does not elect to terminate this Lease pursuant to Section 18.A. hereof, then
Base Rent and Additional Rent payable pursuant to Section 5 hereof shall be
equitably adjusted as of the date title vests in the authority and this Lease
shall otherwise continue in full force and effect.

 

C.     Division of Award: Tenant shall have no claim against Landlord arising
out of or related to any taking, or for any portion of the amount that may be
awarded as a result, damages or compensation attributable to damage to the
Premises, value of the unexpired portion of the Term, loss of profits or
goodwill, leasehold improvements or severance damages, and Tenant hereby assigns
to Landlord all its rights, title and interest in and to any such award;
provided, however, that Tenant may assert any claim it may have against the
authority for compensation for Tenant's Personal Property and for any relocation
expenses compensable by statute, as long as such awards shall be made in
addition to and stated separately from the award made for the Land, the Building
and the Premises. 

 

19.  DEFAULT.

 

A.     Default of Tenant: The following events shall be a default by Tenant (a
"Default") under this Lease:

 

(1)         Failure of Tenant to pay Rent as and when due; provided, however,
that with respect to the first such failure in any twelve (12) month period
only, no Default shall be deemed to have occurred unless such failure continues
for a period of three (3) business days after written notice thereof from
Landlord to Tenant.

 

(2)         Failure of Tenant to comply with or perform any covenant or
obligation of Tenant under this Lease, if the failure continues for thirty (30)
days after notice from Landlord to Tenant specifying the failure, other than (i)
those concerning the payment of Rent, (ii) those set forth in any of Sections
8.B., 17, 21, 22, 26, 35, 36, 37 and 38 hereof, as to which a specific timeframe
for the performance of such covenant or obligation is set forth therein, and
(iii) any Default arising under subsections (3), (4), (5) or (6) of this Section
19.A; provided, however, that if the failure on the part of Tenant is not
capable of being cured within such 30-day period but Tenant expeditiously
commences to cure same and diligently proceeds with such cure, Tenant’s time to
cure such failure shall be extended for the time necessary to cure same, but in
no event longer than ninety (90) days, inclusive of the original 30-day period.

 

 28 

 

 

 

(3)         If, in Landlord's reasonable opinion, Tenant's activities or
presence in the Premises results in a significant, continuing or repeated threat
of physical danger to other tenants and/or users of the Building, whether or not
Tenant is capable of controlling such threat.

 

(4)         If Tenant, any Guarantor or, if Tenant is a partnership, any partner
of Tenant ("Partner"), shall file a voluntary petition in bankruptcy or
insolvency, shall be adjudicated bankrupt or insolvent or shall file a petition
or answer seeking any reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any present or future federal,
state or other Laws, or shall make an assignment for the benefit of creditors,
or shall seek or acquiesce in the appointment of any trustee, receiver or
liquidator of Tenant or of any Guarantor or Partner or of all or any part of the
property of Tenant or of such Guarantor or Partner.

 

(5)         If, within thirty (30) days after the commencement of any proceeding
against Tenant or any Guarantor or Partner, whether by the filing of a petition
or otherwise, seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any present or
future applicable federal, state or other Laws, such proceeding shall not have
been dismissed or if, within thirty (30) days after the appointment of any
trustee, receiver or liquidator of Tenant or any Guarantor or Partner, or of all
or any part of the property of Tenant or of any Guarantor or Partner, without
the acquiescence of such individual or entity, such appointment shall not have
been vacated or otherwise discharged, or if any execution or attachment shall
have been issued against the property of Tenant or of any Guarantor or Partner,
pursuant to which the Premises shall be taken or occupied or attempted to be
taken or occupied.

 

(6)         If Tenant fails to take possession of the Premises on the Lease
Commencement Date or vacates, abandons or ceases to carry on its ordinary
activities in the Premises prior to the Lease Expiration Date, without an
intention of paying Rent; provided, however, that if (i) Tenant gives Landlord
at least thirty (30) days prior written notice that it intends not to occupy the
entire Premises or that it intends to vacate the entire Premises, as applicable,
(ii) Tenant pays the full amount of all Rent when due under this Lease while the
Premises are vacant (subject to applicable notice and cure periods in connection
with any failure to so timely pay Rent), and (iii) Tenant continues to maintain
the Premises in the condition required by this Lease throughout the remainder of
the Term (subject to applicable notice and cure periods in connection with any
failure to so maintain the Premises), then, and in such event only, Tenant shall
not be deemed to be in Default under this Section 19.A.(6).

 

(7)         Failure of Tenant to comply with or perform any covenant or
obligation under Sections 8, 17, 21, 22, 26, 35, 36, 37 or 38 hereof within the
specific timeframe for the performance of such covenant or obligation set forth
in the applicable Section.

 

B.     Remedies Upon Default: Upon the occurrence of a Default, Landlord shall
have the right, then or at any time thereafter:

 

(1)         Without demand or notice, to reenter and take possession of all or
any part of the Premises, to expel Tenant and those claiming through Tenant and
to remove any property therein, either by summary proceedings or by any other
action at law, in equity or otherwise, with or without terminating this Lease,
without being deemed guilty of trespass and without prejudice to any other
remedies of Landlord for breach of this Lease, and/or

 

 29 

 

 

(2)         To terminate this Lease by written notice to Tenant, whereupon this
Lease shall terminate on the date specified in Landlord's notice, and Tenant's
right to possession of the Premises shall cease as of such date.

 

If Landlord elects to terminate this Lease, everything contained in this Lease
on the part of Landlord to be done shall cease, without prejudice to Landlord's
right to recover from Tenant all Rent, as set forth in Sections 19.C., 19.D. and
19.F. below. If Landlord elects to reenter pursuant to Section 19 above,
Landlord may terminate this Lease, or, from time to time without terminating
this Lease, may relet all or any part of the Premises as the agent of Tenant,
for such term, at such rental and upon such other provisions as Landlord deems
acceptable, with the right to make any alterations and repairs to the Premises
that Landlord deems appropriate, including but not limited to restoring the
Premises and Building to a condition necessary to comply with FDA regulations
and any applicable Laws such that the Premises and Building may be relet to
another tenant without delay due to inability to obtain a permit or certificate
of occupancy, at Tenant's expense. No such reentry or taking of possession of
the Premises shall be construed as an election to terminate this Lease, unless
notice of such intention is given pursuant to Subsection B.(2) above, or unless
termination be decreed by a court of competent jurisdiction at the instance of
Landlord. Landlord shall in no event be under any obligation to relet any part
of the Premises.

 

C.     Liability of Tenant: If Landlord terminates this Lease or reenters the
Premises (with or without terminating this Lease), Tenant shall remain liable
(in addition to all other liabilities of Tenant accrued at the time of the
Default) for the sum of (i) any unpaid Rent accrued prior to the time of
termination and/or reentry, as the case may be, plus interest thereon from the
due date at the Default Rate, (ii) all Base Rent and Additional Rent provided
for in this Lease from the time of termination and/or reentry, as the case may
be, until the date this Lease would have expired had a Default not occurred,
plus interest thereon from the due date at the Default Rate, (iii) any and all
expenses (including but not limited to attorneys' and brokerage fees) incurred
by Landlord in reentering and repossessing the Premises, in correcting any
default, in painting, altering, restoring or repairing the Premises in order to
place the Premises in first-class rentable condition (whether or not the
Premises are relet), in protecting and preserving the Premises and in reletting
or attempting to relet the Premises, and (iv) any other amounts necessary to
compensate Landlord for any other injury or detriment caused by the Default;
minus the net proceeds (after deducting any rental abatements, tenant
improvement allowances and other concessions and inducements) actually received
by Landlord, if any, from any reletting to the extent attributable to the period
prior to the date this Lease would have expired had a Default not occurred.
Landlord shall have the option to recover any damages sustained by Landlord
either at the time of reletting, if any, or in separate actions from time to
time as said damages shall have been made more easily ascertainable by
successive relettings or, at Landlord's option, to defer any such recovery until
the date this Lease would have expired in the absence of a Default, in which
event Tenant hereby agrees that the cause of action shall be deemed to have
accrued on the aforesaid date. The provisions of this Section 19.C. shall be in
addition to, and shall not prevent the enforcement of, any claim Landlord may
have for anticipatory breach of this Lease.

 

 30 

 

 

D.     Liquidated Damages: In addition to Landlord's rights pursuant to Section
19.C. above, if Landlord terminates this Lease, Landlord shall have the right at
any time, at its sole option, to require Tenant to pay to Landlord on demand, as
liquidated damages, the sum of (i) the total of the Base Rent, Additional Rent
and all other sums which would have been payable under this Lease from the date
of Landlord's demand for liquidated damages ("Landlord's Demand") until the date
this Lease would have terminated in the absence of the Default, discounted to
present value at the rate of five percent (5%) per annum (the “Discount Rate”),
(ii) all unpaid Rent accrued prior to the time of Landlord's Demand, plus
interest thereon from the due date at the Default Rate, (iii) any and all
expenses (including but not limited to reasonable attorneys' and brokerage fees)
incurred by Landlord in reentering and repossessing the Premises, in correcting
any default, in painting, altering or repairing the Premises in order to place
the Premises in first-class rentable condition (whether or not the Premises are
relet), in protecting and preserving the Premises and in reletting or attempting
to relet the Premises, and (iv) any other amounts necessary to compensate
Landlord for any other injury or detriment caused by the Default; minus the sum
of (a) the net fair market rental value of the Premises for the period referred
to in Section 19.D.(i) above, discounted to present value at the Discount Rate,
and (b) any sums actually paid by Tenant to Landlord pursuant to Subsection C.
above; provided, however, that if said damages shall be limited by law to a
lesser amount, Landlord shall be entitled to recover the maximum amount
permitted by law. The "net fair market rental value" referred to in Section
19.D.(a) above shall be the fair market rental value of the Premises at the time
of Landlord's Demand, reduced by any rental abatements, tenant improvement
allowances and other concessions and inducements generally provided by landlords
seeking to lease comparable commercial property in the area of the Premises at
the time of Landlord's Demand. If reletting is accomplished within a reasonable
time after Lease termination, the "net fair market rental value" referred to in
Section 19.D.(a) above shall be deemed prima facie to be the net rental income
(after deducting any rental abatements, tenant improvement allowances and other
concessions and inducements) realized upon such reletting.

 

E.     Waiver: Tenant, on its own behalf and on behalf of all persons and
entities claiming through Tenant, including but not limited to creditors of
Tenant, hereby waives any and all rights and privileges which Tenant and such
other persons and entities might otherwise have under any present or future
Laws: (i) to redeem the Premises, (ii) to reenter or repossess the Premises, or
(iii) to restore the operation of this Lease, with respect to any dispossession
of Tenant by judgment or warrant of any court, any reentry by Landlord or any
expiration or termination of this Lease, whether by operation of law or pursuant
to the provisions of this Lease. Tenant hereby expressly waives receipt of any
notice to quit.

 

F.     [Intentionally Omitted]

 

G.     Right of Distress: Landlord shall, to the extent permitted by law, have a
right of distress for Rent.

 

H.     Right of Landlord to Cure: If Tenant defaults in the making of any
payment or in the doing of any act required to be made or done by Tenant under
this Lease, then Landlord may, at its option, make such payment or do such act,
and the expenses thereof, with interest thereon at the Default Rate, from the
date paid by Landlord, shall constitute Additional Rent hereunder due and
payable by Tenant with the next payment of Monthly Base Rent.

 

I.     Attorneys' Fees: In the event of any Default hereunder, Tenant shall pay
to Landlord all attorneys' fees incurred by Landlord in connection with such
Default or the enforcement of Landlord's rights or remedies arising in
connection therewith, whether or not this Lease is terminated and whether or not
Landlord institutes any lawsuit against Tenant as a result of such Default. In
addition to the foregoing, whether or not this Lease is terminated, Tenant shall
pay to Landlord all other costs incurred by Landlord with respect to any lawsuit
instituted or action taken by Landlord to enforce the provisions of this Lease.
In the event that Tenant initiates litigation against Landlord based upon an
alleged default by Landlord under this Lease, and Tenant is the prevailing party
in such litigation based upon a judgment by a court of competent jurisdiction
that Landlord is in default hereunder, then, after the date upon which such
judicial order becomes unappealable (i.e., the timeframe for filing appeals has
expired, without an appeal having been filed, or if an appeal has been filed,
such appeal has been finally resolved), Landlord shall pay to Tenant all
reasonable attorneys’ fees.

 

 31 

 

 

J.     Survival: Tenant's liability pursuant to this Section 19 shall survive
the termination of this Lease, the institution of summary proceedings and/or the
issuance of a warrant thereunder.

 

20.  NO WAIVER.

 

No failure or delay by Landlord in enforcing its right to strict performance by
Tenant of every provision of this Lease or in exercising any right or remedy
hereunder, and no acceptance by Landlord of full or partial rent during the
continuance of any Default, shall constitute a waiver of the provision or the
Default, and no provision shall be waived or modified except by a written
instrument executed by Landlord. No payment by Tenant, or receipt by Landlord,
of a lesser amount than the full Rent shall be deemed to be other than a payment
on account, notwithstanding any endorsement or statement on any check or letter
accompanying any payment of any Rent. No waiver of any Default or settlement of
any proceeding instituted on account of any claimed Default shall affect or
alter this Lease or constitute a waiver of any of Landlord's rights hereunder.
No failure or delay by Tenant in enforcing its right to strict performance by
Landlord of every provision of this Lease or in exercising any right or remedy
hereunder shall constitute a waiver of the provision or a default, and no
provision shall be waived or modified except by a written instrument executed by
Tenant.

 

21.  HOLDING OVER.

 

If Tenant shall be in possession of the Premises after termination of this Lease
(whether by normal expiration of the Term or otherwise), at Landlord's option:
(i) Landlord may deem Tenant to be occupying the Premises as a tenant at
sufferance, at the sum of (a) during the first month of such holdover occupancy,
one hundred fifty percent (150%) of the Monthly Base Rent in effect for the last
full month of the Term, and (b) thereafter, two hundred percent (200%) of the
Monthly Base Rent in effect for the last full month of the Term, and, in each
case (that is, with respect to any holdover to which either of the immediately
foregoing clauses (a) or (b) or any combination thereof, applies),, plus the
monthly installment of Additional Rent which is then payable pursuant to Section
5. of this Lease, and subject to all of the other provisions of this Lease, and
(ii) Landlord may exercise any or all remedies for Default and at law and in
equity, including but not limited to an action against Tenant for wrongfully
holding over. Any such holdover shall be deemed to be a tenancy-at-sufferance
and not a tenancy-at-will or tenancy from month-to-month. In no event shall any
holdover be deemed a permitted extension or renewal of the Term, and nothing
contained herein shall be construed to constitute Landlord's consent to any
holdover or to give Tenant any right with respect thereto.

 

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22. SUBORDINATION.

 

A.     Lease Subordinate: Subject to the terms and conditions set forth in this
Section 22, this Lease shall be subject and subordinate to the lien of any and
all Mortgages and to any Ground Leases, and any and all renewals, extensions,
modifications, recastings and refinancings thereof. This clause shall be
self-operative, without execution of any further instrument; but if requested by
Landlord or any Mortgagee, Tenant shall promptly execute a certificate or other
document evidencing and providing for such subordination. Subject to the terms
and conditions set forth in this Section 22, Tenant agrees that, if any Mortgage
is foreclosed or Ground Lease terminated, upon request by the purchaser at the
foreclosure sale or Ground Lessor, as the case may be, Tenant shall attorn to
and recognize the purchaser or Ground Lessor as the landlord under this Lease
and shall make all payments required hereunder to such new landlord without any
deduction or set-off of any kind whatsoever, and such payments shall be credited
against Base Rent and Additional Rent due under this Lease. Tenant waives the
provisions of any Laws, now or hereafter in effect, which may give or purport to
give Tenant any right to terminate or otherwise affect this Lease or the
obligations of Tenant hereunder in the event that any such foreclosure,
termination or other proceeding is filed, prosecuted or completed.

 

B.     Modifications to Lease: If any of Landlord's insurance carriers or any
Mortgagee requests modifications to this Lease, then Tenant shall execute a
written amendment incorporating such requested modifications within thirty (30)
days after the same has been submitted to Tenant by Landlord, provided that such
modifications do not (a) adversely affect Tenant's use of the Premises as herein
permitted, (b) increase the rentals and other sums payable by Tenant hereunder,
(c) include any changes to (i) requirements relating to Tenant's Security
Deposit under Section 35 hereof, (ii) the default provisions of Section 19
hereof, (iii) Tenant's Renewal Option pursuant to Section 41 hereof (iv)
Tenant’s termination rights pursuant to Section 42 hereof, (v) Tenant’s rights
pursuant to Section 43 hereof, or (vi) Tenant’s right of first offer pursuant to
Section 44 hereof, (d) do not adversely affect any of Tenant's other rights or
obligations under this Lease in more than de minimis manner, or (e) decrease
Landlord's obligations hereunder. In the event that Tenant refuses or fails to
execute such amendment within ten (10) days after Landlord’s delivery of same to
Tenant, then Landlord shall have the right to provide Tenant with a notice that
such failure to execute the amendment within an additional ten (10) days shall
constitute a Default under this Lease, and if Tenant fails to execute such
amendment within such additional ten (10) day period, then such failure shall
constitute a Default hereunder

 

C.     Current Non-Disturbance Obligations: On or before the Lease Commencement
Date, Landlord shall obtain from its current Mortgagee a non-disturbance
agreement with respect only to Tenant’s lease of the Second Floor Premises for
the benefit of Tenant in the form attached hereto as Exhibit H and made a part
hereof (the “Current SNDA”).

 

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D.     Future Non-Disturbance Obligations. If (a) at the time of any future
Mortgage or Ground Lease, the Premises comprise a number of rentable square feet
of area which is equal to less than seventy-five percent (75%) of that portion
of rentable area in the Building not then leased by IBT (the “75% Non-IBT
Leasing Threshold), then Landlord shall use commercially reasonable efforts to
obtain from any current or future Mortgagee or Ground Lessor a non-disturbance
agreement for the benefit of Tenant; or (b) at the time of any future Mortgage
or Ground Lease, the Premises comprise a number of rentable square feet of area
which is equal to or greater than the 75% Non-IBT Leasing Threshold, Landlord
shall obtain from any current or future Mortgagee or Ground Lessor a
non-disturbance agreement for the benefit of Tenant, which non-disturbance
agreement described in the immediately preceding clauses (a) or (b) shall either
be substantially in the form of the Current SNDA, or, which shall provide, at a
minimum, that (i) so long as no Default exists under this Lease, in the event of
a foreclosure or deed in lieu of foreclosure, such Mortgagee or Ground Lessor
shall recognize this Lease and shall agree that the tenancy of Tenant hereunder
shall not be disturbed because of such foreclosure or deed in lieu of
foreclosure, (ii) such form shall not reduce Tenant’s rights under this Lease in
more than a de minimis manner or expand Tenant’s obligations under this Lease in
more than a de minimis manner, except for possibly requiring notices from Tenant
to such Mortgagee or Ground Lessor, (iii) shall provide that the Mortgagee or
Ground Lessor, as applicable, specifically recognizes Tenant’s rights under this
Lease including, without limitation, the provisions of Section 42 of this Lease,
and (iv) such form shall not impose on Tenant increased administrative duties
which are more than de minimis and which are not typical of similarly situated
tenants, it being understood that such form may require that Tenant give copies
of all notices to such Mortgagee or Ground Lessor; provided, however, that with
respect to each of the immediately foregoing clauses (a) and (b), (i) Tenant
shall pay all reasonable out-of-pocket costs incurred by Landlord which are
imposed by such Mortgagee or Ground Lessor, as the case may be, with respect to
such non-disturbance agreement and (ii) in the event that Landlord does not
obtain such non-disturbance agreement, then Landlord shall not be in default
under this Lease and (x) in the event that Landlord does not deliver to Tenant a
non-disturbance agreement pursuant to clause (a) above, then this Lease shall
remain subject and subordinate to the lien of any and all Mortgages and to any
Ground Leases, and any and all renewals, extensions, modifications, recastings
and refinancings thereof, and (y) in the event that Landlord does not deliver to
Tenant a non-disturbance agreement pursuant to clause (b) above, then Tenant’s
sole remedy shall be that this Lease shall not be subject and subordinate to the
lien of said Mortgage or Ground Lease, as the case may be until such time as
Landlord delivers to Tenant non-disturbance agreement which complies with this
Section 22.D.

 

E.     Must Take Space Non-Disturbance Obligations: Notwithstanding anything
contained herein to the contrary, prior to the date that Tenant enters into an
amendment for the Must Take Space (as hereinafter defined) pursuant to Section
43.C. hereof, Landlord shall obtain from any future Mortgagee or Ground Lessor a
non-disturbance agreement for the benefit of Tenant either in substantially the
same form as the Current SNDA, or in such Mortgagee’s or Ground Lessor’s, as the
case may be, usual form, which form shall, at a minimum, provide that (i) so
long as no Default exists under this Lease, such Mortgagee or Ground Lessor or
any successor thereto as a result of a foreclosure or deed in lieu of
foreclosure shall recognize this Lease and shall agree that the tenancy of
Tenant hereunder shall not be disturbed because of such foreclosure or deed in
lieu of foreclosure, (ii) such form shall not reduce Tenant’s rights under this
Lease in more than a de minimis manner or expand Tenant’s obligations under this
Lease in more than a de minimis manner, (iii) such form shall provide that the
Mortgagee or Ground Lessor, as applicable, specifically recognizes Tenant’s
rights under this Lease including, without limitation, the provisions of Section
42 of this Lease and the provisions of the Work Agreement and agrees to the
provisions thereof, and (iv) such form shall not impose on Tenant increased
administrative duties which are more than de minimis and which are not typical
of similarly situated tenants, it being understood that such form may require
that Tenant give copies of all notices to such Mortgagee or Ground Lessor;
provided, however, that Tenant shall pay all costs incurred by Landlord which
are imposed by such future Mortgagee or Ground Lessor, as the case may be, with
respect to such non-disturbance agreement. Notwithstanding anything to the
contrary contained in this Lease, in the event that Landlord does not obtain
such non-disturbance agreement from any future Mortgagee or Ground Lessor, as
the case may be, Landlord shall not be in default under this Lease and Tenant’s
sole remedy shall be that this Lease shall not be subject or subordinate to the
lien of said future Mortgage or Ground Lease, as the case may be, until such
time as Landlord delivers to Tenant a non-disturbance agreement which meets the
requirements of this Section 22.E.

 

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23.  ASSIGNMENT AND SUBLETTING.

 

A.     No Transfer Without Consent: Tenant shall not, without the prior written
consent of Landlord in each instance (which consent may be withheld in
Landlord's sole and absolute discretion) (i) assign, mortgage or otherwise
encumber this Lease or any of its rights hereunder; (ii) sublet the Premises or
any part thereof or permit the occupancy or use of the Premises or any part
thereof by any persons or entities other than Tenant and its agents and
employees; or (iii) permit the assignment of this Lease or any of Tenant's
rights hereunder by operation of law. Any attempted assignment, mortgaging or
encumbering of this Lease or any of Tenant's rights hereunder and any attempted
subletting or grant of a right to use or occupy all or a portion of the Premises
in violation of the foregoing sentence shall be void. If at any time during the
Term Tenant desires to assign, sublet or mortgage all or part of this Lease or
the Premises, then in connection with Tenant's request to Landlord for
Landlord's consent thereto, Tenant shall give thirty (30) days’ notice prior to
Landlord in writing (“Tenant's Request Notice”) containing: the identity of the
proposed assignee, subtenant or other party and a description of its business;
the terms of the proposed assignment, subletting or other transaction; the
commencement date of the proposed assignment, subletting or other transaction
(the “Proposed Sublease or Assignment Commencement Date”); the area proposed to
be assigned, sublet or otherwise encumbered (the “Proposed Sublet or Assignment
Space”); the proposed use of the proposed assignee or subtenant, including the
Hazardous Materials intended to be used, stored, handled, treated, generated,
disposed or released from the Premises and related permits, reports and
management, storage and installation plans; the most recent financial statement
or other evidence of financial responsibility of such proposed assignee,
subtenant or other party; and a certification executed by Tenant and such party
stating whether or not any premium or other consideration is being paid for the
assignment, sublease or other transaction. Notwithstanding the foregoing,
Landlord agrees that it shall not unreasonably withhold, condition or delay its
consent to a proposed subletting or assignment, provided that all of the
following conditions are satisfied: (1) there shall be no default at the time of
the proposed subletting or assignment (or if there is a default, then Tenant
cures such default within the applicable cure period), (2) in the event of a
proposed assignment, the proposed assignee shall have a “net tangible worth”
sufficient in Landlord’s reasonable determination to perform Tenant’s
obligations under the Lease, and liquid assets of at least Fifty Million Dollars
($50,000,000.00), and such proposed assignee shall provide a Security Deposit
that is equal to any then-existing Security Deposit, (3) the proposed subtenant
or assignee shall not be a governmental entity or a person or entity enjoying
sovereign or diplomatic immunity, (4) the use of the Premises by the proposed
subtenant or assignee shall not attract a volume, frequency or type of visitor
or employee to the Building which is not consistent with the character of the
Project or the standards of a high-quality research, development and laboratory
building, (5) the proposed subtenant or assignee shall specifically covenant and
agree to perform the obligations of Tenant hereunder and to occupy the Premises
subject to the provisions of this Lease, and (6) Tenant remains liable for the
faithful performance of this Lease. As used herein, "net tangible worth" shall
mean the excess of total assets over total liabilities, in each case as
determined in accordance with generally accepted accounting principles (“GAAP”),
excluding, however, from the determination of total assets all assets that would
be classified as intangible assets under GAAP, including, without limitation,
goodwill, licenses, patents, trademarks, trade names, copyrights, and
franchises.

 

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B.     [Intentionally Omitted].

 

C.     Transfer of Ownership Interests: If Tenant is a partnership, then any
event (whether voluntary, concurrent or related) resulting in a dissolution of
Tenant, any withdrawal or change (whether voluntary, involuntary or by operation
of law) of partners owning a controlling interest in Tenant (including each
general partner), or any structural or other change having the effect of
limiting the liability of the partners shall be deemed a voluntary assignment of
this Lease subject to the provisions of this Section 23. If Tenant is a
corporation (or a partnership with a corporate general partner), then any event
(whether voluntary, concurrent or related) resulting in a dissolution, merger,
consolidation or other reorganization of Tenant (or such corporate general
partner), or the sale or transfer or relinquishment of the interest of
shareholders who, as of the date of this Lease, own a controlling interest of
the capital stock of Tenant (or such corporate general partner), shall be deemed
a voluntary assignment of this Lease subject to the provisions of this Section
23; provided, however, that this sentence shall not apply to corporations whose
stock is traded through a national or regional exchange or over-the-counter
market. If Tenant is a limited liability company, then any dissolution of Tenant
or a withdrawal or change, whether voluntary, involuntary or by operation of
law, of members owning a controlling interest in Tenant shall be deemed a
voluntary assignment of this Lease which is subject to the provisions of this
Section 23. In addition, a transfer of all or substantially all of the assets of
Tenant, either by merger, consolidation, or otherwise shall be deemed to be an
assignment which is subject to the provisions of this Section 23. Except as
otherwise specifically permitted by Section 23.F. below, whether Tenant is a
partnership, corporation or any other type of entity, then at the option of
Landlord, a sale of all or substantially all of Tenant's assets, or a conversion
into any other type of entity shall also be deemed a voluntary assignment of
this Lease which is subject to the provisions of this Section 23. Tenant shall
provide Landlord notice within ten (10) days after a name change of Tenant.

 

D.     Expenses and Profits; Effect of Consent:

 

(1)         In the event Landlord permits Tenant to assign or sublet all or a
portion of the Premises to a third party, fifty percent (50%) of any sums that
are paid by such third party for the right to occupy the Premises, in excess of
the sum of (i) the Rent then in effect, and (ii) reasonable costs and expenses
actually incurred by Tenant in connection with such assignment or subletting for
brokerage commissions, reasonable attorneys’ fees, improvements to the Premises
and advertising expenses shall be paid by Tenant to Landlord on a monthly basis
as Additional Rent.

 

(2)         Tenant shall be responsible for all costs and expenses, including
reasonable attorneys' fees, incurred by Landlord in connection with any proposed
or purported assignment or sublease and an administrative fee of One Thousand
Five Hundred Dollars ($1,500.00).

 

(3)         The consent by Landlord to any assignment or subletting shall
neither be construed as a waiver or release of Tenant from any covenant or
obligation of Tenant under this Lease, nor as relieving Tenant from giving
Landlord the aforesaid thirty (30) days’ notice of, or from obtaining the
consent of Landlord to, any further assignment or subletting. The collection or
acceptance of Rent from any such assignee or subtenant shall not constitute a
waiver or release of Tenant from any covenant or obligation of Tenant under this
Lease, except as expressly agreed by Landlord in writing.

 

E.     Conditions of Assignment or Sublease: All restrictions and obligations
imposed pursuant to this Lease on Tenant shall be deemed to extend to any
subtenant, assignee, licensee, concessionaire or other occupant or transferee,
and Tenant shall cause such person to comply with such restrictions and
obligations. Any assignee shall be deemed to have assumed obligations as if such
assignee had originally executed this Lease and at Landlord's request shall
execute promptly a document confirming such assumption. Each sublease is subject
to the condition that if the Term is terminated or Landlord succeeds to Tenant's
interest in the Premises by voluntary surrender or otherwise, at Landlord's sole
option, the subtenant shall be bound to Landlord for the balance of the term of
such sublease and shall attorn to and recognize Landlord as its landlord under
the then executory terms of such sublease or, at Landlord's sole option, the
subtenant shall execute a direct lease with Landlord on Landlord's then current
standard form.

 

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F.     Permitted Subleases and Assignments: Notwithstanding the foregoing
provisions of this Section 23, Landlord agrees that so long as (a) no default is
then continuing beyond any applicable cure period, (b) no circumstance shall
have occurred which with the giving of notice, the passage of time, or both
would constitute a Default by Tenant, and (c) in the event of an assignment, the
proposed assignee shall have a net tangible worth sufficient in Landlord’s
reasonable determination to perform Tenant’s obligations under the Lease, and
liquid assets of at least Fifty Million Dollars ($50,000,000.00) , the
provisions of Sections 23.A., 23.C., 23.D.(1) and 23.D.(2) shall not be
applicable with regard to an assignment of this Lease or a subletting of all or
any portion of the Premises to Tenant’s Affiliate (as hereinafter defined), so
long as (1) Tenant originally named herein shall remain primarily liable under
this Lease, notwithstanding any such assignment or subletting (unless Tenant has
merged into such entity, in which case such surviving entity shall assume all of
the obligations of Tenant under this Lease), (2) no other or further assignment
or subletting to other than an Affiliate shall be permitted without Landlord’s
prior written consent, (3) in the case of an assignment, the assignee executes a
commercially reasonable form of assignment and assumption agreement with respect
to the assumption by the assignee of all of Tenant’s then existing and future
obligations under this Lease, and (4) Tenant provides Landlord with written
notice of such assignment or subletting not less than ten (10) days prior to the
date thereof. An “Affiliate” shall be a person or entity (i) that directly, or
indirectly through one or more intermediaries, controls or is controlled by, or
is under common control with, the Tenant, or (ii) which has succeeded to the
ownership of Tenant or of substantially all of Tenant’s assets, stock or
membership interests by sale, transfer merger or consolidation or as a result of
Tenant’s no longer being listed for sale to the public on a stock exchange.
“Control” shall mean the possession, direct or indirect, of the power to direct
or cause the direction of the management and policies of a person or entity,
whether through ownership of voting securities, by contract, or otherwise.
Tenant shall have the right to retain all sums that are paid by an Affiliate for
the right to occupy the Premises.

 

G.     Desk Share Agreements. Notwithstanding anything contained in this Section
23 to the contrary (except Section 23.E above), if (1) if no default on the part
of Tenant then exists hereunder (or if there is a default, then Tenant cures
such default within the applicable cure period) and (2) the amount of space
utilized for short-term occupancy or “desk space” rights pursuant to this
Section 23.G shall not exceed twenty-five percent (25%) of the total number of
rentable square feet of area comprising the Premises, then Novavax, Inc., a
Delaware corporation (“Novavax”) may, without Landlord’s prior written consent
and without being subject to Landlord’s rights and Tenant’s obligations set
forth in Sections 23.A., 23.C., 23.D.(1) and 23.D.(2) above, sublease or license
one or more individual offices (and the use of areas ancillary thereto) in the
Premises, or to grant short-term occupancy or “desk space” rights to third
parties or Affiliates; provided, however, that (a) such portions of the Premises
so affected shall not be separately demised or segregated from the Premises by
the construction of a partition wall or entrances, (b) such arrangements shall
be with entities having objectives harmonious with the objectives pursued by
Novavax, and (c),any such desk space user shall agree to indemnify Landlord,
Landlord’s management agent and any Mortgagees and to hold them harmless from
and against all costs, damages, claims, liabilities and expenses, including, but
not limited to, reasonable attorneys’ fees, directly or indirectly, based on,
arising out of or resulting from: (i) such desk space user’s use and occupancy
of the Premises or the business conducted by such desk space user therein or
such desk space user’s presence in the Premises, (ii) any act or omission of
such desk space user or its employees, agents or contractors, (iii) any breach
or default by such desk space user in the observance or performance of Tenant’s
covenants and obligations under this Lease (other than Tenant’s obligations to
pay Base Rent and Additional Rent hereunder), and (iv) Tenant shall notify
Landlord of such arrangement at least ten (10) business days prior to such
arrangement(s) commencing.

 

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24.  TRANSFER BY LANDLORD.

 

Landlord (and any successor or affiliate of Landlord) may freely sell, assign or
transfer all or any portion of its interest in this Lease or the Premises, the
Security Deposit, the Building or the Land and, in the event of any such sale,
assignment or transfer, shall be relieved of any and all obligations under this
Lease from and after the date of the sale, assignment or transfer. From and
after said date, Tenant shall be bound to such purchaser, assignee or other
transferee, as the case may be, as though the latter had been the original
Landlord hereunder, provided that the purchaser, assignee or transferee agrees
to assume the obligations of Landlord hereunder.

 

25.  INABILITY TO PERFORM.

 

This Lease and Landlord’s and Tenant's obligation hereunder shall in no way be
affected, impaired or excused, nor shall Landlord and Tenant have any claim
against the other for damages, because the other party, due to Unavoidable
Delays, is unable to fulfill any of its obligations under this Lease, including,
but not limited to, any obligations to provide any services, repairs,
replacements, alterations or decorations or to supply any improvements,
equipment or fixtures, but in no event shall this Section 25 be interpreted to
relieve Tenant of any of its obligations to pay Rent in the amounts and when due
under this Lease or its obligations to obtain and maintain any insurance
required hereunder.

 

26.  ESTOPPEL CERTIFICATES.

 

Tenant shall, without charge, within ten (10) business days after receipt of any
request therefor, execute and deliver to Landlord a certificate stating:
(i) whether this Lease is unmodified and in full force and effect (or if there
have been modifications, that the Lease is in full force and effect and setting
forth all such modifications); (ii) whether there then exist any defenses
against the enforcement of any right of Landlord hereunder (and, if so,
specifying the same in detail); (iii) the dates to which rent and any other
charges hereunder have been paid by Tenant; (iv) that Tenant has no knowledge of
any then uncured defaults under this Lease (or, if Tenant has knowledge of any
such defaults, specifying the same in detail); (v) that Tenant has no knowledge
of any event that will or may result in the termination of this Lease (or if
Tenant has such knowledge, specifying the same in detail); (vi) the address to
which notices to Tenant are to be sent; and (vii) such other information as may
be reasonably requested. It is understood that any such certificate may be
relied upon by Landlord, any Mortgagee, prospective Mortgagee, Ground Lessor,
prospective Ground Lessor, or purchaser or prospective purchaser of the Land or
the Building.

 

27.  COVENANT OF QUIET ENJOYMENT.

 

Landlord covenants that it has the right to make this Lease and that, if Tenant
shall pay all Rent and perform all of Tenant's other obligations under this
Lease within any applicable notice and cure periods, Tenant shall have the
right, during the Term and subject to the provisions of this Lease, to quietly
occupy and enjoy the Premises without hindrance by Landlord or its successors
and assigns.

 

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28.  WAIVER OF JURY TRIAL.

 

Landlord and Tenant hereby waive trial by jury in any action, proceeding or
counterclaim brought by either of them against the other with respect to any
matter arising out of or connected with this Lease.

 

29.  BROKERS.

 

Landlord and Tenant each represents and warrants to the other that, except as
hereinafter set forth, neither of them has employed any broker in procuring or
carrying on any negotiations relating to this Lease. Landlord and Tenant shall
indemnify and hold each other harmless from any loss, claim or damage relating
to the breach of the foregoing representation and warranty. Landlord recognizes
only the Broker(s) (as set forth in Section 1.J. hereof) as broker(s) with
respect to this Lease and agrees to be responsible for the payment of any
leasing commissions owed to said broker(s).

 

30.  CERTAIN RIGHTS RESERVED BY LANDLORD.

 

Landlord shall have the following rights, exercisable without notice, without
liability for damage or injury to property, person or business and without
effecting an eviction, constructive or actual, or disturbance of Tenant's use or
possession of the Premises or giving rise to any claim for set-off, abatement of
Rent or otherwise:

 

A.     To change the Building's name or street address.

 

B.     To affix, maintain and remove any and all signs on the exterior and
interior of the Building.

 

C.     To designate and approve (such approval not to be unreasonably withheld,
conditioned or delayed with respect to Alterations that do not affect Building
systems or the Building structure), prior to installation, all window shades,
blinds, drapes, awnings, window ventilators, lighting and any other equipment to
be installed by Tenant that may be visible from the exterior of the Premises or
the Building.

 

D.     To decorate and make repairs, alterations, additions and improvements,
whether structural or otherwise, in, to and about the Building and any part
thereof, including, but not limited to, equipment served by the Building
systems, and for such purposes to enter the Premises, and, during the
continuance of any such work, to close temporarily doors, entry ways, Common
Areas in the Building and to interrupt or temporarily suspend Building services
and facilities, all without affecting Tenant's obligations hereunder. Landlord
agrees to use commercially reasonable efforts not to interfere with the conduct
of Tenant’s ordinary business operations in the Premises during any access of
the Premises by Landlord.

 

E.     To grant to anyone the exclusive right to conduct any business or render
any service in the Building, provided Tenant is not thereby excluded from uses
expressly permitted herein.

 

F.     To alter, relocate, reconfigure and reduce the Common Areas of the
Building, as long as the Premises remain reasonably accessible.

 

G.     To alter, relocate, reconfigure, reduce and withdraw the Common Areas
located outside the Building, including parking and access roads, as long as the
Premises remain reasonably accessible.

 

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H.   To erect, use and maintain pipes and conduits in and through the Premises.

 

I.     To construct improvements (including kiosks) on the Land and in the
Common Areas of the Building.

 

J.     To prohibit smoking in the entire Building or portions thereof (including
the Premises) and on the Land, so long as such prohibitions are in accordance
with applicable Laws.

 

K.    If any excavation or other substructure work shall be made or authorized
to be made upon land adjacent to the Building or the Land, to enter the Premises
for the purpose of doing such work as is required to preserve the walls of the
Building and to preserve the land from injury or damage and to support such
walls and land by proper foundations. Landlord agrees to use commercially
reasonable efforts not to interfere with the conduct of Tenant’s ordinary
business operations in the Premises during any access of the Premises by
Landlord.

 

L.     Notwithstanding anything contained herein to the contrary, Landlord may
at any time elect to alter, rehabilitate or renovate all or any portion of the
Building so long as such construction does unreasonably interfere with Tenant’s
access to the Premises or unreasonably interfere with Tenant’s use of the
Premises. Tenant acknowledges that Landlord has the right to undertake major
renovations (including work with respect to the exterior façade of the Building)
with respect to the Building and that Landlord may hereafter perform additional
work, improvements and renovations with respect to the Building. In connection
with any such work, improvements and renovations, the Landlord may erect
scaffoldings, sidewalk bridges and other such appurtenances. Tenant agrees not
to interfere with such work, improvements and renovations and further agrees
that such work, improvements and renovations (and the construction appurtenances
which Landlord may place at or near the Premises) shall not constitute an
eviction or constructive eviction of Tenant, in whole or in part, and the Base
Rent and all other items of Additional Rent hereunder shall not abate while such
work, improvements and renovations are being made by reason of loss or
interruption of the business of Tenant or otherwise, nor shall Tenant have any
claims against Landlord by reason of such work. Landlord agrees to use
commercially reasonable efforts not to interfere with the conduct of Tenant’s
ordinary business operations in the Premises during any access of the Premises
by Landlord.

 

31.  NOTICES.

 

No notice, request, approval, waiver or other communication which may be or is
required or permitted to be given under this Lease shall be effective unless the
same is in writing and hand-delivered, sent by registered or certified mail,
return receipt requested, first-class postage prepaid, or sent with charges
prepaid by a nationally recognized air courier service, addressed to Landlord at
the Landlord Notice Address or to Tenant at the Tenant Notice Address, as
applicable, or at any other address of which either party shall notify the other
in accordance with this Section 31. Such communications, if sent by registered
or certified mail, shall be deemed to have been given two (2) days after the
date of mailing, or if sent by a nationally recognized air courier service,
shall be deemed to have been given one (1) business day after the date of
deposit of the notice with such service. If any Mortgagee shall notify Tenant
that it is the holder of a Mortgage affecting the Premises, no notice, request
or demand thereafter sent by Tenant to Landlord shall be effective until a copy
of same shall be sent to such Mortgagee in the manner prescribed in this Section
31 at such address as such Mortgagee shall designate.

 

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32.  MISCELLANEOUS PROVISIONS.

 

A.     Benefit and Burden: The provisions of this Lease shall be binding upon,
and shall inure to the benefit of, the parties hereto and each of their
respective successors and permitted assigns.

 

B.     Governing Law: This Lease shall be construed and enforced in accordance
with the Laws of the jurisdiction in which the Building is located.

 

C.     No Partnership: Nothing contained in this Lease shall be deemed to create
a partnership or joint venture between Landlord and Tenant, or to create any
other relationship between the parties other than that of Landlord and Tenant.

 

D.     Delegation by Landlord: Wherever Landlord has the authority to take any
action under this Lease, Landlord shall have the right to delegate such
authority to others, and Landlord shall be responsible for the authorized
actions of such agents, employees and others, to the same extent as if Landlord
had taken such action itself.

 

E.     Tenant Responsibility for Agents: In any case where Tenant is responsible
for performing or refraining from an act or for preventing an action or result
from occurring, Tenant shall also be responsible for any actions taken or
omitted by Tenant's agents, employees, business invitees, licensees,
contractors, subtenants, and any other individuals or entities present in the
Building or on the Land at Tenant's invitation.

 

F.     Invalidity of Particular Provisions: If any provision of this Lease or
the application thereof to any person, entity or circumstance shall, to any
extent, be held invalid or unenforceable, the remaining provisions and the
application of such invalid or unenforceable provisions to persons, entities and
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby. Each provision of this Lease shall be valid and
enforced to the fullest extent permitted by law.

 

G.     Counterparts: This Lease may be executed in several counterparts, all of
which shall constitute one and the same document.

 

H.     Entire Agreement: This Lease, and any exhibits and addenda attached
hereto, embody the entire agreement of the parties hereto, and no
representations, inducements or agreements, oral or otherwise, between the
parties not contained in this Lease or in the exhibits or addenda shall be of
any force or effect. No rights, privileges, easements or licenses are granted to
Tenant hereby, except as expressly set forth herein.

 

I.     Amendments: This Lease may not be modified in whole or in part in any
manner other than by an agreement in writing signed by both Landlord and Tenant.

 

J.     Mortgagee's Performance: Tenant shall accept performance of any of
Landlord's obligations hereunder by any Mortgagee.

 

K.    Limitation on Interest: In any case where this Lease provides for a rate
of interest that is higher than the maximum rate permitted by law, the rate
specified herein shall be deemed to equal, and the party designated as recipient
of such interest shall be entitled to receive, the maximum rate of interest
permitted by law.

 

L.     Remedies Cumulative: All rights and remedies of Landlord shall be
cumulative and shall not be exclusive of any other rights or remedies of
Landlord hereunder or now or hereafter existing at law or in equity.

 

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M. Annual Financial Statements: Not later than March 31 of each calendar year
during the Term, Tenant shall submit to Landlord an audited financial statement
covering the preceding calendar year, which has been prepared in accordance with
generally accepted accounting principles by an independent certified public
accountant. The provisions of this Paragraph 32.M. shall not be applicable at
any time that Tenant’s financial statement is available from the Securities and
Exchange Commission’s EDGAR website or a similar federal-governmentally
regulated source readily available to members of the public without charge.

 

N.     Construction of Lease: There shall be no presumption that this Lease be
construed more strictly against the party who itself or through its agent
prepared it. Landlord and Tenant hereby agree that all parties hereto have
participated in the preparation of this Lease and that each party had the
opportunity to consult legal counsel before the execution of this Lease.

 

O.     Time of the Essence: Time is of the essence with respect to each of
Tenant’s obligations hereunder.

 

P.     Effect of Deletion of Language: The deletion of any printed, typed or
other portion of this Lease shall not evidence the parties' intention to
contradict such deleted portion. Such deleted portion shall be deemed not to
have been inserted in this Lease.

 

Q.     Authority: Tenant represents and warrants that the person executing this
Lease is duly authorized to so act; that Tenant is duly organized, is qualified
to do business in the jurisdiction in which the Building is located, is in good
standing under the Laws of the state of its organization and the Laws of the
jurisdiction in which the Building is located, and has the power and authority
to enter into this Lease; and that all action required to authorize Tenant and
such person to enter into this Lease has been duly taken. Landlord represents
and warrants that the person executing this Lease is duly authorized to so act;
that Landlord is duly organized, is qualified to do business in the jurisdiction
in which the Building is located, is in good standing under the Laws of the
state of its organization and the Laws of the jurisdiction in which the Building
is located, and has the power and authority to enter into this Lease; and that
all action required to authorize Landlord and such person to enter into this
Lease has been duly taken.

 

R.      Qualified Leases: The parties intend that all payments made to Landlord
under this Lease will qualify as rents from real property for purposes of
Sections 512(b)(3) and 856(d) of the Internal Revenue Code of 1986, as amended
(“Qualified Rents”). If Landlord, in its sole discretion, advises Tenant that
there is any risk that all or part of any payments made under this Lease will
not qualify as Qualified Rents, Tenant agrees (i) to cooperate with landlord to
restructure this Lease in such manner as may be necessary to enable such
payments to be treated as Qualified Rents, and (ii) to permit an assignment of
this Lease, in each case provided such restructuring or assignment will not
increase Tenant’s obligations or reduce Tenant’s rights under the Lease other
than in a de minimis manner.

 

33.  [INTENTIONALLY OMITTED].

 

34.   PARKING.

 

A.     Use of Parking.

 

(1)         During the Term, Tenant shall have the right to use (on a
non-exclusive first-come, first-served basis) the Parking Permits (as defined in
Section 1.P hereinabove) for the unreserved parking of passenger automobiles in
the parking areas designated from time to time by Landlord for the use of
tenants of the Building (the "Parking Area"). Landlord does not assume any
responsibility and shall not be held liable for any damage or loss to any
automobile or personal property in or about the Parking Area or for any injury
sustained by any person in or about the Parking Area. Tenant understands and
acknowledges that the Parking Area of the Building may be operated by or leased
to a third party (“Parking Operator”) pursuant to an agreement with Landlord. As
a result, the parties acknowledge that Tenant’s parking rights shall be subject
to the terms and conditions of Landlord’s agreement with the Parking Operator;
however, there shall be no charge for Tenant’s Parking Permits during the Term
of this Lease as extended. Landlord reserves the right to modify in any way
Landlord deems appropriate the manner in which the Parking Area is accessed
during the Term. Tenant shall not use the Parking Area for the overnight storage
of vehicles. It is understood and agreed that Landlord assumes no
responsibility, and shall not be held liable for any damage or loss to any
automobiles parked in the Parking Area or to any personal property located
therein or for any injury sustained by any person in or about the Parking Area.

 

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(2)         Subject to the limitations imposed thereon from time to time by
Landlord and/or the Parking Operator, Tenant’s customers and visitors shall have
the right to use available spaces in the Parking Area for the purpose of parking
their vehicles therein while visiting the Premises. Tenant’s customers and
visitors shall pay the then current hourly parking fees established by Landlord
and/or the Parking Operator, as adjusted from time to time, for the privilege of
using the Parking Area. The foregoing shall in no way be construed to impose
upon Landlord any obligation to provide customer parking for Tenant.

 

(3)         Landlord’s granting of parking rights hereunder does not create a
bailment between the parties, it being expressly agreed that the only
relationship created between Landlord and Tenant hereby is that of right grantor
and right grantee. All motor vehicles (including all contents thereof) shall be
in the Parking Area at the sole risk of their owners and Tenant, and Landlord is
not responsible for the protection and security of such vehicles. Neither
Landlord nor any agent, employee or contractor of Landlord shall have any
liability for any property damage or personal injury arising out of or in
connection with said motor vehicles, and Tenant shall indemnify and hold
Landlord and any agent, employee or contractor of Landlord harmless from and
against all demands, claims, damages, costs, expenses, liabilities, or causes of
action arising out of or connected with use of the Parking Area by Tenant or by
any of Tenant's employees, agents, invitees, guests, assignees, subtenants,
contractors or visitors (collectively, "Tenant's Invitees"), or any acts or
omissions arising out of or in connection with said motor vehicles.

 

(4)         In its use of the Parking Area, Tenant will follow all terms of all
applicable Rules and Regulations enacted by Landlord with respect to the Parking
Area, and will cause Tenant’s Invitees to do the same. Any violation of said
applicable Rules and Regulations will constitute a Default hereunder. Upon any
such Default, in addition to Landlord’s other rights and remedies, Landlord may
terminate Tenant’s rights to lease parking spaces in the Parking Area in
accordance with the terms of Section 34.A.(1). above.

 

(5)         If: (i) all or a portion of the Parking Area is damaged by fire or
other casualty or taken by power of eminent domain or purchased in lieu thereof
by any governmental authority, (ii) the insurance proceeds payable as a result
of a casualty to the Parking Area are applied to a Mortgage, or (iii) there is
any material uninsured loss to the Parking Area, Landlord may terminate Tenant’s
right to lease spaces in the Parking Area in accordance with the terms of
subsection (a) above. If Landlord does not so elect to terminate such rights of
Tenant pursuant to the foregoing provisions of this Section34.A.(5), then:
(1) Landlord will either (a) proceed to restore the Parking Area (and Landlord
shall have no obligation to provide any alternative parking while such
restoration is being performed), or (b) not restore the Parking Area, but
provide Tenant, free of charge, with alternate parking throughout the remainder
of the Term (if such alternative parking is reasonably available under the
circumstances).

 

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B.     No Transfers. Except in connection with a permitted assignment or
sublease pursuant to Section 23 hereof, Tenant shall not assign, sublet or
transfer any Parking Permits without Landlord’s prior written consent. Any
attempted assignment, sublet, or transfer shall be void. Landlord reserves the
right for the operator of the Parking Area (if any) to institute either a valet
parking system or a self-parking system. Tenant and its employees shall observe
reasonable safety precautions in the use of the Parking Area and shall at all
times abide by all rules and regulations of which is has received written notice
governing the use of the Parking Area promulgated by Landlord or the Parking
Area operator, and Landlord shall use commercially reasonable efforts to apply
any new rules and regulations in a non-discriminatory manner to all tenants in
the Building. The Parking Area will remain open Monday through Friday (excluding
Holidays) during the Building Hours. Landlord reserves the right to close the
Parking Area during periods of unusually inclement weather or for repairs.
Landlord does not assume any responsibility, and shall not be held liable, for
any damage or loss to any automobile or personal property in or about the
Parking Area, or for any injury sustained by any person in or about the Parking
Area.

 

35.  SECURITY DEPOSIT.

 

A.     Amount and Uses: Upon (a) the First Floor Premises Lease Commencement
Date, Tenant shall deliver to Landlord a Security Deposit in an amount equal to
the sum of three (3) months of then current Base Rent for the First Floor
Premises (the “First Floor Premises Security Deposit”), and (b) the date that
the Must Take Space, or a portion thereof, become part of the Premises
hereunder, Tenant shall deliver to Landlord a Security Deposit in an amount
equal to the sum of three (3) months of then current Base Rent for the Must Take
Space, or a portion thereof, as applicable (the “Must Take Space Security
Deposit”) , to be held by Landlord as security for the payment of all Rent
payable by Tenant and for the faithful performance by Tenant of all other
obligations of Tenant under this Lease within any applicable notice and cure
period. Notwithstanding the foregoing, unless any default by Tenant has occurred
under this Lease or there then exists any circumstance which with the giving of
notice or the passage of time would constitute a Default by Tenant under this
Lease, (a) the First Floor Premises Security Deposit shall be reduced to (i) the
sum of two (2) months of the then current First Floor Premises Base Rent on
December 31, 2020, and (ii) one (1) month of the then current First Floor
Premises Base Rent on December 31, 2021, and (b) the Must Take Space Security
Deposit shall be reduced to (x) the sum of two (2) months of then current Base
Rent for the Must Take Space on December 31, 2020, and (y) one (1) month of then
current Base Rent for the Must Take Space on December 31, 2021, except that
there shall be no such reduction if any Default by Tenant has occurred under
this Lease or there then exists any circumstance which with the giving of notice
or the passage of time would constitute a Default by Tenant under this Lease.
The required amount of the Security Deposit on December 31, 2021 shall remain as
the amount of the Security Deposit for the remainder of the Term hereof. If the
Security Deposit is in the form of cash, said Security Deposit shall be repaid
to Tenant after the termination of this Lease (or any renewal thereof), provided
Tenant shall have made all such payments and performed all such obligations
hereunder. Landlord shall not be required to maintain the Security Deposit in a
separate account. The Security Deposit shall not be mortgaged, assigned,
transferred or encumbered by Tenant without the prior written consent of
Landlord, and any such act shall be void. Landlord may, at Landlord's option,
appropriate and apply the entire Security Deposit, or so much thereof as
Landlord believes may be necessary, to compensate Landlord for the payment of
any past-due Rent and for loss or damage sustained by Landlord due to any
Default. In the event Landlord appropriates or applies the Security Deposit in
such a manner, Tenant, within five (5) business days after notice thereof, shall
pay to Landlord an amount sufficient to restore the Security Deposit to the
original sum deposited. Tenant's failure to restore any such deficiency shall
constitute a Default hereunder. In the event of bankruptcy or other
debtor-creditor proceedings by or against Tenant, the Security Deposit shall be
applied first to the payment of Rent due Landlord for all periods prior to the
filing of such proceedings.

 

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In lieu of a cash Security Deposit, Tenant shall have the right to place the
Security Deposit in the form of a letter of credit which satisfies all of the
requirements hereinafter described (the “Letter of Credit”). Any Letter of
Credit delivered to Landlord by Tenant shall be an unconditional, irrevocable
letter of credit in a form and from a FDIC-insured financial institution
acceptable to Landlord in its sole and absolute discretion and shall be capable
of being drawn upon in the Washington, DC metropolitan area. Said Letter of
Credit shall provide that it shall expire on the thirtieth (30th) day following
the date of expiration of the Term of this Lease. At Tenant's option, said
Letter of Credit shall have a term equal to the period expiring on the first
anniversary of the date of issuance thereof, in which event Tenant covenants
that a renewal of said Letter of Credit shall be delivered to Landlord by that
date which is thirty (30) days prior to the expiration date thereof, and
thereafter a renewal of the Letter of Credit shall be delivered to Landlord by
Tenant by that date which is thirty (30) days prior to each succeeding
anniversary of the original expiration date of the Letter of Credit. If Tenant
fails to so renew and deliver said Letter of Credit to Landlord by the thirtieth
(30th) day preceding each said expiration date, such failure shall constitute a
Default hereunder (as to which no cure period shall be applicable) and Landlord
may draw upon the Letter of Credit then in effect without the necessity of any
other monetary or other default hereunder by Tenant, in which event the proceeds
thereof shall be held by Landlord. Said Letter of Credit shall provide that
Landlord shall be permitted to draw on the same on multiple occasions following
the occurrence of a Default by Tenant under this Lease; provided, however, that
in the event that said Letter of Credit would expire during the pendency of any
litigation to resolve whether such Default has occurred, Landlord may draw upon
said Letter of Credit prior to the expiration thereof. In the event that
Landlord draws upon the Letter of Credit after a Default by Tenant as aforesaid,
Landlord shall use, apply or retain all or any portion of the proceeds thereof
for (i) the payment of any Rent or any other sums as to which Tenant is in
Default, (ii) the payment of any amount which Landlord may spend or become
obligated to spend to repair damage to the Premises or the Building for which
repairs Tenant is liable hereunder, or (iii) compensation to Landlord for any
losses or damages (actual and consequential to the extent permitted hereunder)
which Landlord is entitled to recover hereunder by reason of Tenant's default,
including, but not limited to, any damage or deficiency arising in connection
with the reletting of the Premises and all associated reasonable legal fees. In
the event that the Letter of Credit is drawn upon by Landlord for failure of
Tenant to renew said Letter of Credit as aforesaid, the proceeds thereof shall
be held by Landlord in accordance with the provisions respecting the Security
Deposit under this Section 35, and, in such event, within thirty (30) days after
the expiration of the Term, and provided Tenant has vacated the Premises and is
not in Default hereunder, Landlord shall return such proceeds to Tenant, less
such portion thereof as Landlord may be entitled hereunder to apply to satisfy
any default by Tenant hereunder. In the event that Tenant is in default upon the
expiration of the Term and Landlord does not use all of the Security Deposit to
cure such default, then, after such default has been cured, Landlord shall
return any unused balance of the Security Deposit to Tenant. The use,
application or retention of the proceeds of the Letter of Credit, or any portion
thereof, by Landlord shall not prevent Landlord from exercising any other right
or remedy provided by this Lease or by law, and shall not limit any recovery to
which Landlord may otherwise be entitled. In the event of the sale or transfer
of Landlord's interest in the Building or the Land, Landlord shall transfer the
proceeds of the Letter of Credit to the purchaser or transferee, in which event
Tenant shall look only to the purchaser or transferee for the return of the
proceeds of the Letter of Credit, and Landlord shall be released from all
liability to Tenant for the return of such proceeds.

 

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B.     Transferability: In the event of a sale or transfer of Landlord's
interest in the Building or of the interest of any successor or assign of
Landlord, Landlord (or such successor or assign) shall have the right to
transfer the Security Deposit to any such transferee and shall thereupon be
released automatically from any liability therefor. Tenant shall look solely to
the transferee for the return of the Security Deposit. No Mortgagee or purchaser
of any or all of the Building at any foreclosure proceeding shall (regardless of
whether the Lease is at the time subordinated to the lien of said Mortgage) be
liable to Tenant or any other person for any of the Security Deposit, or any
other payment made by Tenant hereunder, unless Landlord has actually delivered
said deposit or other such sum to such Mortgagee or purchaser. In the event of
any rightful and permitted assignment of Tenant's interest in this Lease, the
Security Deposit shall be deemed to be held by Landlord as a deposit made by the
assignee, and Landlord shall have no liability to the assignor with respect to
the return of the Security Deposit.

 

C. This Section 35 shall survive the expiration or termination of this Lease.

 

36.  HAZARDOUS MATERIALS.

 

A.     Definition. As used in this Lease, the term “Hazardous Material” means
any flammable items, explosives, radioactive materials, hazardous or toxic
substances, material or waste or related materials, including any substances
defined as or included in the definition of “hazardous substances”, “hazardous
wastes”, “infectious wastes”, “hazardous materials” or “toxic substances” now or
subsequently regulated under any state, local or federal Laws, including, but
not limited to, the Comprehensive Environmental Response, Compensation and
Liability Act and the Resource Conservation and Recovery Act (“Environmental
Rules”). Such substances, materials and wastes may include, without limitation,
oil, synthetic or natural gases, petroleum-based products, paints, solvents,
lead, cyanide, DDT, printing inks, acids, pesticides, ammonia compounds and
other chemical products, asbestos, PCBs and similar compounds, and including any
different products and materials which are subsequently found to have adverse
effects on the environment or the health and safety of persons or animals under
any Environmental Rules. As defined in Environmental Rules, 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 of its agents,
employees, licensees, guests or invitees during the Term, and the wastes,
by-products, or residues generated, resulting, or produced therefrom, excluding
any Hazardous Material brought on the Premises or the Property by Landlord or
its agents, employees or contractors or any party acting by or through Landlord.

 

B.     General Prohibition. Tenant shall not cause or permit any Hazardous
Material to be generated, produced, brought upon, used, stored, treated,
discharged, released, spilled or disposed of on, in under or about the Premises
or the Project by Tenant or Tenant's Invitees in violation of the Environmental
Rules. Tenant shall indemnify, upon full execution and delivery of this Lease,
throughout the Term and following the expiration or earlier termination of this
Lease defend and hold Landlord, Landlord's agents and all Mortgagees harmless
from and against 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,
actual and consequential damages (including without limitation, attorneys',
consultants', and experts' fees, court costs and amount 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
arising from a breach of this prohibition by Tenant or Tenant's Invitees.

 

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C.     Permitted Use. Landlord acknowledges that it is not the intent of this
Section 36 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 complies with, and is properly
monitored according to, all then applicable Environmental Rules. 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 Lease
Commencement Date a list identifying each type of Hazardous Materials to be
brought upon, kept, used, stored, handled, treated, generated on, or released or
disposed of from, the Premises and setting forth any and all governmental
approvals or permits required in connection with the presence, use, storage,
handling, treatment, generation, release or disposal of such Hazardous Materials
on or from the Premises (“Hazardous Materials List”). Tenant shall deliver to
Landlord an updated Hazardous Materials List at least once a year and shall also
deliver an updated list before any new Hazardous Material is brought onto,
treated, generated on, or released from, the Premises. Tenant is not required,
however, to provide Landlord with any information on the Hazardous Materials
List 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 36 to provide Landlord with information which could be
detrimental to Tenant’s business should such information become possessed by
Tenant’s competitors.

 

D.     Tenant’s Representation and Warranty. Tenant hereby represents and
warrants to Landlord that (i) neither Tenant nor, to the knowledge of Tenant’s
Key Executives (as defined in Section 1.GG hereof), any of its legal
predecessors has been required by any prior landlord, lender or any governmental
authority at any time to take remedial action in connection with Hazardous
Materials contaminating a property which contamination was permitted by Tenant
or 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, treatment, generation, release or disposal of Hazardous Materials
(including, without limitation, any order related to the failure to make a
required report to any governmental authority). If Landlord determines that this
representation and warranty was false as of the date of this Lease, Tenant shall
be deemed to be in Default hereunder and Landlord shall have the right to
terminate this Lease in Landlord’s sole and absolute discretion and to pursue
all applicable remedies for such Default set forth in Section 19 hereof.

 

E.     Landlord’s Obligations. In the event that Landlord receives written
notice from a governmental agency of the presence of Hazardous Materials in the
Premises or in any of the Common Areas of the Building which are utilized by
Tenant in a quantity and of a nature that violates any applicable Laws that were
not introduced to the Building, the Land or both of same by or on behalf of
Tenant, Landlord shall take such action, if any, as may be required to comply
with such laws or governmental regulations; provided, however, that Landlord
shall have the right to contest any such notice of violation, in which case
Landlord’s obligation to cure shall not arise until after the final adjudication
of the validity of the violation notice.

 

 47 

 

 

F.     Tests. Landlord shall have the right to conduct annual tests, or more
frequently if Landlord reasonably deems it necessary, of the Premises to
determine whether any contamination of the Premises or the Project has occurred
as a result of Tenant’s use. Tenant shall be required to pay the cost of each
such test of the Premises; 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 tests to be paid for by Tenant.
In connection with such testing, upon the request of Landlord, Tenant shall
deliver to Landlord or its consultant such non-proprietary information
concerning the use of Hazardous Materials in or about the Premises by Tenant or
any of its agents. Landlord shall provide Tenant, upon Tenant’s written request,
with a copy of all third party, non-confidential reports and tests of the
Premises concerning environmental contamination 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 for which Tenant is responsible under this Lease in accordance with all
Environmental Rules. Landlord’s receipt of or satisfaction with any
environmental assessment in no way waives any rights which Landlord may have
against Tenant.

 

G.     Underground Tanks. Tenant shall not install or otherwise operate any
underground storage tank on the Project without Landlord’s prior written
consent, which may be granted, denied or withheld in Landlord’s sole and
absolute discretion. 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 and manage such storage tanks, maintain records
as required by the Environmental Rules, obtain and maintain prudent insurance,
implement reporting procedures, properly close any underground storage tanks,
and take or cause to be taken all other actions necessary or required under the
Environmental Rules in connection with the installation, use, maintenance,
management, operation, upgrading and closure of such storage tanks.

 

H.     Waste Disposal. Tenant recognizes that the Building does not contain a
lab waste system. Tenant also acknowledges that any violation by Tenant of the
Washington Suburban Sanitary Commission (“WSSC”) rules and regulations governing
illegal discharges would cause substantial harm to the Building and the Project,
and that such violation would be unlawful and constitute a Default under this
Lease. Therefore, Tenant shall be solely responsible for any improper discharge
or disposal by Tenant or its agents, contractors, employees, or invitees during
Tenant’s occupancy of the Premises or any of the aforementioned parties’ access
of the Premises. Tenant shall, at its sole cost and expense, test such waste
prior to discharging or disposing the same and cause such waste to be disposed
or discharged in accordance with WSSC regulations and any other applicable Laws.

 

I.     Notice. In the event that Hazardous Materials are discovered upon, in, or
under the Building or the Project, and any governmental agency or entity having
jurisdiction over the Building or the Project requires the removal of such
Hazardous Materials, Tenant shall immediately notify Landlord in writing. Tenant
shall also immediately notify Landlord in writing (upon obtaining actual
knowledge thereof) of: (i) any spill, release, discharge or disposal of any
Hazardous Material in, on or under the Project or any portion thereof; (ii) any
enforcement, cleanup, removal or other governmental or regulatory action
instituted, contemplated, or threatened pursuant to any Environmental Rules
respecting Hazardous Materials; (iii) any claim made or threatened by any person
against Tenant or the Property or any portion thereof relating to damage,
contribution, cost recovery, compensation, loss or injury resulting from or
claimed to result from any Hazardous Materials; and (iv) any reports made to any
governmental agency or entity arising out of or in connection with any Hazardous
Materials in, on under or about or removed from the Property or any portion
thereof, including any complaints, notices, warnings, reports or asserted
violations in connection therewith. Tenant also shall supply to Landlord as
promptly as possible, and in any event within five (5) business days after
Tenant first receives or sends the same, copies of all claims, reports,
complaints, notices, warnings or asserted violations relating in any way to the
Premises, the Property or Tenant's use or occupancy thereof.

 

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J.     Survival. The respective rights and obligations of Landlord and Tenant
under this Section 36 shall survive the expiration or earlier termination of
this 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, the Building or the Project 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 approved
Surrender Plan, as hereinafter defined in Section 40), Tenant shall continue to
pay the full Base Rent and Additional Rent in accordance with this Lease for any
portion of the Premises not relet by Landlord in Landlord’s sole and absolute
discretion, which Rent shall be prorated on a daily basis.

 

37.  [INTENTIONALLY OMITTED].

 

38.  NO RECORDATION.

 

Tenant shall not record or attempt to record this Lease or any memorandum hereof
in any public records without the prior written approval of Landlord, which may
be denied in Landlord's sole and absolute discretion. In the event that Landlord
grants its approval to record this Lease or a memorandum hereof, Tenant shall
pay all recordation fees, taxes and charges in connection with such recordation.

 

39.  SIGNS.

 

Landlord will, at Landlord’s cost, provide Tenant with a listing on the Building
directory, if any, and provide Building standard signage on one suite entry door
of the Premises. No other sign, advertisement or notice shall be inscribed,
painted, affixed or otherwise displayed on any part of the exterior or interior
of the Building (including windows and doors) without the prior written approval
of Landlord, which may be granted or withheld in Landlord's reasonable
discretion. If any such item that has not been approved by Landlord is so
displayed, then Landlord shall have the right to remove such item at Tenant's
expense or to require Tenant to do the same. Landlord reserves the right to
install and display signs, advertisements and notices on any part of the
exterior or interior of the Building.

 

Notwithstanding the foregoing or anything in this Lease to the contrary, so long
as Tenant occupies not less than 19,430 square feet of rentable area in the
Building, Tenant, at its sole cost and expense, shall have the non-exclusive
right, to install signage on the exterior of the Building (such signage being
referred to herein as “Tenant’s Exterior Signage”), on the top level of the
Building facing Firstfield Road. Tenant’s Exterior Signage shall comply with all
applicable Laws, including, but not limited to, Laws promulgated by Montgomery
County, Maryland, and shall be of a type, style, size, color, design, location
and method of fabrication approved by Landlord, in Landlord’s reasonable
discretion. Tenant, at its sole cost and expense, shall be responsible for the
installation, maintenance, repair and replacement of Tenant’s Exterior Signage.
On or before the date of expiration or earlier termination of this Lease, Tenant
shall remove Tenant’s Exterior Signage and shall repair any damage caused to the
Building by Tenant’s Exterior Signage and by such removal, all at Tenant’s sole
cost and expense and in accordance with all applicable Laws.

 

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40.  SURRENDER.

 

Upon the expiration of the Term or earlier termination of Tenant’s occupancy,
Tenant shall, subject to the terms of Section 10.A. of this Lease, surrender the
Premises to Landlord in the same condition as the Premises were in on the Lease
Commencement Date (excluding reasonable wear and tear and damage caused by fire
or other casualty), subject to any Alterations or Installations permitted or
required 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 unless the presence of such Hazardous Materials
on the Premises was caused by Landlord, its agents, employees or contractors or
any party acting under or through Landlord and released of all Hazardous
Materials Clearances, and in accordance with the laboratory decommissioning
requirements set forth on Exhibit B attached hereto, broom clean, ordinary wear
and tear and casualty loss and condemnation covered in Sections 16 and 18 hereof
excepted. At least ninety (90) days prior to the expiration of the Term or
anticipated earlier termination or vacancy of the Premises by Tenant, Tenant
shall deliver to Landlord a narrative description of the actions proposed (or
required by any governmental authority) that Tenant plans to perform to
surrender the Premises (including any Installations permitted by Landlord to
remain in the Premises) at the expiration or earlier termination of this Lease
or vacancy of the Premises, free from any residual impact from Hazardous
Materials which are the responsibility of Tenant under this Lease (“the
Surrender Plan”). Such Surrender Plan shall be accompanied by a current listing
of (i) all Hazardous Materials licenses and permits held by or on behalf of
Tenant or its agents 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
or Landlord’s environmental consultant, such approval not to be unreasonably
withheld, conditioned or delayed. In connection with the review and approval of
the Surrender Plan, upon the request of Landlord, Tenant shall deliver to
Landlord or its consultant such additional non-proprietary information
concerning Tenant’s use of Hazardous Materials as Landlord shall reasonably
request. On or before the date of such surrender, Tenant shall deliver to
Landlord evidence that the approved Surrender Plan shall have been
satisfactorily completed and Landlord shall have the right, subject to
reimbursement at Tenant’s expense as set forth below, to cause Landlord’s
environmental consultant to inspect the Premises and perform such additional
procedures as may be deemed reasonably necessary to confirm that the Premises
are, as of the effective date of such surrender or early termination of this
Lease, free from any residual impact from Tenant’s use of Hazardous Materials.
Tenant shall reimburse Landlord, as Additional Rent, for the actual
out-of-pocket expense incurred by Landlord for Landlord’s environmental
consultant to review and approve the Surrender Plan and to visit the Premises
and verify satisfactory completion of all actions described therein. Landlord
shall have the unrestricted right to deliver such Surrender Plan and any report
by Landlord’s environmental consultant with respect to the surrender of the
Premises to third parties.

 

If Tenant shall fail to prepare or submit a Surrender Plan approved by Landlord,
or if Tenant shall fail to complete the approved Surrender Plan, or if such
Surrender Plan, whether or not approved by Landlord, shall fail to adequately
address any residual effect of Tenant’s use of Hazardous Materials in the
Premises or the Project, 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 Hazardous Materials,
the cost of which actions shall be reimbursed by Tenant as Additional Rent,
without regard to the limitation set forth in the first paragraph of this
Section 40.

 

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Tenant shall immediately return to Landlord all keys and/or access cards to the
Parking Area, the Project, restrooms and 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, within fifteen (15)
days after Landlord’s demand therefor, either the cost of replacing such lost
access card or key or the cost of reprogramming the access security system in
which such access card was used or changing the lock or locks opened by such
lost key. All obligations of Tenant hereunder not fully performed as of the
expiration of the Term or earlier termination of this Lease shall survive the
expiration of the Term or earlier termination of this Lease, including, without
limitation, Tenant’s indemnity obligations, payment obligations with respect to
Rent and obligations concerning the condition and repair of the Premises.

 

41.  OPTION TO EXTEND.

 

A.     Provided that Novavax is not then in default (or if Novavax is then in
default, then provided it cures the same within the applicable notice and cure
period set forth in this Lease), and has not been in Default more than two (2)
times during the immediately preceding three (3) years, in each case both at the
time of exercise of a Renewal Option, as hereinafter defined, and at the
commencement of a Renewal Period, as hereinafter defined, and is then in
occupancy of the Premises at the time of exercise of a Renewal Option, as
hereinafter defined, and at the time of the commencement of a Renewal Period, as
hereinafter defined, Novavax shall have two (2) options (each, a “Renewal
Option”) to extend the Term of the Lease for two (2) additional five (5) year
periods (each, a “Renewal Period”) after the expiration of the initial Term or
the first Renewal Period, as applicable. Each Renewal Option shall be
exercisable only by written notice given by Novavax to Landlord not later than
twelve (12) months, nor earlier than eighteen (18) months, prior to the
expiration of the initial Term or the first Renewal Period, as applicable. In
the event that Novavax does not timely exercise a Renewal Option, all remaining
Renewal Options shall be null and void and of no further force or effect, time
being of the essence in the exercise of a Renewal Option and it being
acknowledged and agreed by Novavax that Landlord shall be entitled to rely on
any failure by Novavax to give written notice of its exercise of a Renewal
Option by the date set forth herein for such exercise thereof. If Novavax
exercises a Renewal Option pursuant to this Section 41, Novavax shall have the
right to renew the Lease (a) with respect to the entire Premises or, (b) a
portion of the Premises only; provided, however, that if Novavax renews the
Lease with respect to only a portion of the Premises, such portion shall consist
of an entire floor or one or more entire individual suites, and Novavax shall
not have the right to subdivide any existing suites as a part of such extension.

 

B.     All terms and conditions of this Lease shall be applicable during the
Renewal Period except that the amount of Base Rent charged for each Renewal
Period shall be Landlord’s reasonable determination of the then “Prevailing
Market Rent”, which shall be the rent charged to renewal tenants for comparable
office, research and development laboratory space in comparable buildings in
Montgomery County, Maryland. Such calculation shall also include equitable
deductive adjustments being made for those leasing concessions, if any, which
are then prevalent in the submarket. If within thirty (30) days following
delivery of Novavax’s notice, Landlord and Novavax have not mutually agreed on
the Prevailing Market Rent for the Renewal Period, then within ten (10) days
after the expiration of such thirty-day period, each party shall give written
notice to the other setting forth the name and address of a Broker (as
hereinafter defined) selected by such party who has agreed to act in such
capacity, to determine the Prevailing Market Rent. If either party shall fail to
select a Broker as aforesaid, the Prevailing Market Rent shall be determined by
the Broker selected by the other party. Each Broker shall thereupon
independently make his determination of the Prevailing Market Rent within twenty
(20) days after the appointment of the second Broker. If the two Brokers’
determinations are not the same, but the higher of such two values is not more
than one hundred five percent (105%) of the lower of them, then the Prevailing
Market Rent shall be deemed to be the average of the two values. If the higher
of such two values is more than one hundred five percent (105%) of the lower of
them, then the two Brokers shall jointly appoint a third Broker within ten (10)
days after the second of the two determinations described above has been
rendered. The third Broker shall independently make his determination of the
Prevailing Market Rent within twenty (20) days after his appointment. The
highest and the lowest determinations of value among the three Brokers shall be
disregarded and the remaining determination shall be deemed to be the Prevailing
Market Rent (the foregoing procedure shall be referred to herein as the “Three
Broker Method”).

 

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C.     For the purposes of this Section 41, “Broker” shall mean a real estate
broker or salesperson who is not, at such time, under a contract with Landlord
or its affiliates for brokerage services at the Building, licensed in the State
of Maryland, who has been regularly engaged in such capacity in the business of
commercial office and research and development laboratory leasing in Montgomery
County, Maryland for at least ten (10) years immediately preceding such person’s
appointment hereunder. Each party shall pay for the cost of its Broker and one
half of the cost of the third Broker.

 

D.     Within thirty (30) days (subject to written extension by Landlord) after
Landlord delivers to Novavax an amendment to this Lease incorporating the terms
of the Renewal Period as determined by this Section 41, and not otherwise
modifying any of the terms of this Lease, Landlord and Novavax shall execute
such amendment to this Lease setting forth the terms as to the Renewal Period.
If Novavax shall fail to execute said amendment within such thirty (30) day
period (as the same may be extended as aforesaid), then Landlord shall have the
right, at Landlord’s option exercisable by written notice to Novavax: (a) to
cancel the exercise by Novavax of Novavax’s option and to offer to lease and to
lease the Premises to others upon such terms and conditions as shall be
acceptable to Landlord, or (b) to not cancel the exercise by Novavax of Novavax'
s option, in which case Novavax shall remain bound by the exercise thereof.

 

42.  TENANT’S TERMINATION OPTION.

 

A.     Notwithstanding anything in this Lease to the contrary, in the event that
(a) Landlord and IBT do not enter into the IBT Release on or before the Outside
Release Date, and (b) Tenant has not leased any portion of the Must Take Space
(as defined in Section 43 below) on or before the Outside Release Date, Tenant
shall have the right, exercisable at Tenant’s sole option, to terminate this
Lease with respect to either (a) the entire Second Floor Premises, (b) Suite 200
or (c) Suite 201, individually, effective as of December 31, 2021 (the “Second
Floor Premises Termination Date”), said right of Tenant to be exercisable by
giving written notice thereof (the “Second Floor Premises Termination Notice”)
to Landlord, which Second Floor Premises Termination Notice shall be given, if
at all, not later than twelve (12) months prior to the Second Floor Premises
Termination Date. In the event that Tenant exercises its termination option
pursuant to this Section 42.A., this Lease shall continue in full force and
effect until the Second Floor Premises Termination Date, whereupon Tenant shall
surrender possession of the Second Floor Premises, or the applicable portion
thereof, in accordance with the provisions of this Lease, this Lease shall
terminate with respect to the Second Floor Premises, or the applicable portion
thereof, as if the Second Floor Premises Termination Date were the Lease
Expiration Date set forth herein for the Premises or the applicable portion
thereof, and all Base Rent and Additional Rent shall be prorated as of the
Second Floor Premises Termination Date with respect to the Second Floor
Premises, or the applicable portion thereof. Tenant’s right hereunder to
terminate this Lease with respect to the Second Floor Premises, or the
applicable portion thereof, pursuant to this Section 42.A. shall be exercisable
only if (1) Tenant is not then in default under this Lease (or if Tenant is then
in default, Tenant cures such default within the applicable cure period) at the
time Tenant delivers the Second Floor Premises Termination Notice or on the
Termination Date, and (2) Tenant pays to Landlord, contemporaneously with the
giving of its Second Floor Premises Termination Notice, an amount equal to the
sum of the then unamortized sum of (a) brokerage commissions incurred by
Landlord with respect to this Lease and any amendments hereto, and (b)
compounded interest on the amounts set forth in clause (a) of this Section
42.A., computed at the rate of seven percent (7%) per annum amortized on a
straight line basis over the Term of this Lease, (the items set forth in clauses
(a) and (b) of this Section 42.A. being hereinafter collectively referred to as
the “Second Floor Premises Termination Expenses”). The Second Floor Premises
Termination Expenses payable by Tenant to Landlord pursuant to the immediately
preceding sentence shall be in addition to the Rent coming due between the date
of the Second Floor Premises Termination Notice and the Second Floor Premises
Termination Date.

 

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B.     Notwithstanding anything in this Lease to the contrary, in the event that
(a) Landlord and IBT have entered into the IBT Release on or before the Outside
Release Date and Landlord has delivered a copy of the IBT Release to Tenant, or
(b) Tenant has leased any portion of the Must Take Space on or before the
Outside Release Date, Tenant shall have the right, exercisable at Tenant’s sole
option, to terminate this Lease with respect to either (a) the entire portion of
the Premises located on the first (1st) floor of the Building, and/or (b) the
entire portion of the Premises located on the second (2nd) floor of the
Building, effective as of November 30, 2023 (the “Termination Date”), said right
of Tenant to be exercisable by giving written notice thereof (the “Termination
Notice”) to Landlord, which Termination Notice shall be given, if at all, not
later than twelve (12) months prior to the Termination Date. In the event that
Tenant exercises its termination option hereunder, this Lease shall continue in
full force and effect until the Termination Date, whereupon Tenant shall
surrender possession of the Premises, or the applicable portion thereof, in
accordance with the provisions of this Lease, this Lease shall terminate with
respect to the Premises, or the applicable portion thereof, as if the
Termination Date were the Lease Expiration Date set forth herein for the
Premises or the applicable portion thereof, and all Base Rent and Additional
Rent shall be prorated as of the Termination Date with respect to the Premises,
or the applicable portion thereof. Tenant’s right hereunder to terminate this
Lease pursuant to this Section 42.B. shall be exercisable only if (1) Tenant is
not then in default under this Lease (or if Tenant is then in default, Tenant
cures such default within the applicable cure period) at the time Tenant
delivers the Second Floor Premises Termination Notice or on the Termination
Date, and (2) Tenant pays to Landlord, contemporaneously with the giving of its
Termination Notice, an amount equal to the sum of the then unamortized sum of
(a) the cost of any tenant improvement allowance with respect to the Premises,
or the applicable portion thereof subject to the Termination Notice; provided,
however, that for the purposes hereof, the Must Take Space Tenant Allowance
shall be considered to be One Hundred Twenty-Five Dollars ($125.00) per rentable
square foot of the Must Take Space, (b) brokerage commissions incurred by
Landlord with respect to this Lease and any amendments hereto with respect to
the Premises, or the applicable portion thereof subject to the Termination
Notice, and (c) compounded interest imputed on the amounts set forth in clauses
(a) and (b) of this Section 42.B. computed at the rate of seven percent (7%) per
annum amortized on a straight line basis over the initial Term of this Lease,
(the items set forth in clauses (a) through (c) of this Section 42.B. being
hereinafter collectively referred to as the “Termination Expenses”). The
Termination Expenses payable by Tenant to Landlord pursuant to the immediately
preceding sentence shall be in addition to the Rent coming due between the date
of the Termination Notice and the Termination Date.

 

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43.  MUST TAKE SPACE.

 

A.     Obligation to Lease Must Take Space: Notwithstanding anything contained
herein to the contrary, if Landlord and IBT enter into the IBT Release in
accordance with Section 2.B. hereof on or before the Notice Outside Date and
Landlord delivers a copy of the IBT Release to Tenant, Tenant shall be obligated
to lease from Landlord each of Suite 101, Suite 102 and Suite 202 in the
Building, as shown on Exhibit G attached hereto and made a part hereof
(collectively, the “Must Take Space”), or any remaining portion of the Must Take
Space which has not then been leased by Tenant pursuant to Section 43.B hereof,
all in accordance with the terms of this Section 43. In such event, the Must
Take Space shall become part of the Premises in accordance with the terms of
this Section 43, and Landlord and Tenant shall execute an amendment to this
Lease setting forth the terms of the incorporation of the Must Take Space into
the Premises, in accordance with this Section 43.

 

B.     Option to Lease Must Take Space: Provided that Tenant is not then in
default (or, if Tenant is then in default, then provided Tenant cures such
default within the applicable cure period set forth in this Lease) and has not
been in Default more than two (2) times during the immediately preceding three
(3) years, in each case both at the time of exercise of the option hereinafter
granted and at the time of the commencement of the term as to the Must Take
Space, then solely during the period commencing on the Lease Commencement Date
and ending on August 15, 2015 (the “Notice Outside Date”), Tenant shall have an
ongoing option to lease from Landlord all or any full suite portion of the Must
Take Space by delivering to Landlord written notice thereof. In the event that
Tenant does not timely exercise its option to lease all or a full suite portion
of the Must Take Space, said option shall be null and void and of no further
force or effect, time being of the essence in the exercise of said option, it
being acknowledged and agreed by Tenant that Landlord shall be entitled to rely
on any failure by Tenant to give written notice of its exercise of its rights
hereunder by the date set forth herein for such exercise thereof.

 

C.     Terms of Lease of Must Take Space. From and after the date Landlord
delivers the Must Take Space to Tenant in its as-is condition (per the terms and
conditions in this Lease) vacant and free of (i) occupants and (ii) any
occupancy rights of other parties with respect to the Must Take Space (the “Must
Take Space Commencement Date”), either pursuant to Section 43.A above or
pursuant to Section 43.B above, as applicable, such Must Take Space, or the
applicable portion thereof, when so leased to Tenant shall become part of the
Premises and shall be subject to the terms and conditions of this Lease then
prevailing for the balance of the Term, and all economic and other terms of this
Lease that vary with the size of the Premises shall be revised to include the
Must Take Space, or the applicable portion thereof, including, but not limited
to, Base Rent (which shall be based upon the then escalated amount of the Second
Floor Premises Base Rent and subject to the same percentage increases and at the
same times as the Second Floor Premises Base Rent), Tenant’s Share of Operating
Expenses, Tenant’s Share of Real Estate Tax Expenses, and the number of Parking
Permits. Notwithstanding the foregoing, Landlord shall grant to Tenant a “rent
holiday” from the payment of the installments of Base Rent for the Must Take
Space, or the applicable portion thereof, commencing on the Must Take Space
Commencement Date and continuing through December 31, 2016 (the “Must Take Space
Free Rent Period”). During such Must Take Space Free Rent Period, the Base Rent
with respect to the Must Take Space, or the applicable portion thereof, shall be
abated (such rental abatement being hereinafter referred to as the “Must Take
Space Free Rent Allowance”); provided, however, that (i) Tenant shall remain
obligated during the Must Take Space Free Rent Period to perform all of Tenant’s
obligations with respect to the remainder of the Premises and with respect to
the Must Take Space, or the applicable portion thereof, under this Lease except
as expressly aforesaid (including, but not limited to, the payment of all amount
due and payable with respect to the remainder of the Premises, Additional Rent
(including, but not limited to, Tenant’s Share of Operating Expenses and
Tenant’s Share of Real Estate Tax Expenses), coming due under this Lease with
respect to the Must Take Space, or the applicable portion thereof), and (iii) in
the event of any termination of this Lease by Landlord based upon a Default
hereunder by Tenant, the unamortized portion of Base Rent for the Must Take
Space which would have otherwise been due and payable hereunder during the Must
Take Space Free Rent Period in the absence of the Must Take Space Free Rent
Allowance shall immediately become due and payable and any remaining Must Take
Space Free Rent Allowance hereunder shall be of no force or effect.

 

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D.     Execution of Lease Amendment: After the date on which either (i) Landlord
provides evidence to Tenant of the IBT Release or (ii) Tenant exercises its
right to lease the Must Take Space, or a portion thereof, as applicable,
Landlord shall provide Tenant with an amendment to this Lease incorporating the
terms of the Must Take Space as determined by this Section 43 and not otherwise
modifying any of the terms of this Lease, and within thirty (30) days after
delivery of such amendment, Landlord and Tenant shall execute such amendment to
this Lease setting forth the terms set forth in this Section 43 as to the Must
Take Space, or the applicable portion thereof. If Tenant shall fail to execute
said amendment to this Lease for the Must Take Space, or the applicable portion
thereof, within such thirty (30) day period (as the same may be extended as
aforesaid), then Landlord shall have the right, at Landlord’s option exercisable
by written notice to Tenant: (a) to cancel the exercise by Tenant of Tenant’s
option and to offer to lease and to lease such Must Take Space to others upon
such terms and conditions as shall be acceptable to Landlord, and to hold Tenant
liable for any damages to Landlord from such cancellation, or (b) to not cancel
the exercise by Tenant of Tenant’s option, in which case Tenant shall remain
bound by the exercise thereof.

 

E.     Condition of Must Take Space; Must Take Space Tenant Allowance. Tenant
shall accept the Must Take Space in its then as-is condition on the date of
delivery by Landlord, and Landlord shall have no obligation to make any
improvements or alterations to any portion of the Must Take Space except to the
extent of Landlord’s general maintenance and repair obligations set forth in
this Lease. Notwithstanding the foregoing, Landlord shall make available for
Tenant’s improvements to the Must Take Space, an allowance (the "Must Take Space
Tenant Allowance") in an amount equal to the product of (i) One Hundred Fifty
Dollars ($150.00) multiplied by (ii) the number of rentable square feet
comprising the applicable portion of the Must Take Space. The Must Take Space
Tenant Allowance shall be used by Tenant in connection with all costs of
improving the Must Take Space, including, but not limited to, the cost of all
permits and governmental inspections, the cost of professional services,
consulting services, furniture, fixtures, equipment, wiring (IT and/or
telecommunications). all architectural and engineering fees, the preparation and
delivery to Landlord of as-built plans, a coordination fee paid to Landlord in
the amount of one percent (1%) of the cost of the improvement to the Must Take
Space, and any other work or services required for Tenant to renovate the Must
Take Space, all of which costs shall be payable out of the Must Take Space
Tenant Allowance to the extent that the Must Take Space Tenant Allowance is
sufficient for that purpose, and any excess amount of which costs shall be paid
directly by Tenant. Notwithstanding the foregoing, not more than Thirty Percent
(30%) of the Must Take Space Tenant Allowance may be used for the aggregate
costs of furniture, fixtures, equipment, and wiring (IT and/or
telecommunications). Except as set forth in this Section 43.D, the terms and
conditions governing the payment and use of the Must Take Space Tenant Allowance
shall be the same as those governing the payment and use of the Tenant Allowance
with respect to the First Floor Premises set forth in the Work Agreement,
attached hereto as Exhibit C, which terms and conditions shall be incorporated
into the amendment to be executed by the parties as provided in Section 43.D.
above.

 

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44.  RIGHT OF FIRST OFFER.

 

A.     Available Space. Provided that Novavax (a) is not then in default (or, if
Novavax is then in default, then provided Novavax cures such default within the
applicable cure period set forth in this Lease), and has not been in Default
more than twice during the immediately preceding three (3) years of the Term, in
each case both at the time of Landlord’s Offer, as hereinafter defined, and at
the time of the commencement of the Term as to the Available Space, as
hereinafter defined, and (b) is then in occupancy of the Premises at the time of
Landlord’s Offer, as hereinafter defined, and at the time of the commencement of
the term as to the Available Space, as hereinafter defined, and the Premises
comprise not less than 19,340 square feet of rentable area, then during the
period commencing on July 2, 2015, and ending upon the date that is thirty-six
(36) months prior to the expiration of the Term, Novavax shall have a continuous
right to receive from Landlord prior to the next leasing of said Available Space
by Landlord, an offer to lease the Available Space to Novavax on the terms set
forth in Landlord’s Offer, which offer shall be accepted or rejected at
Novavax’s option. “Available Space” means only that portion of the Must Take
Space not leased by Tenant in accordance with the terms of Section 43 hereof on
or before the Notice Outside Date, as said space may become available for lease
after the initial leasing thereof by Landlord to another tenant. The Available
Space shall be offered to and accepted (if at all) by Novavax on the terms and
conditions set forth in Landlord’s offer to Novavax as to such Available Space
(“Landlord’s Offer”), which Landlord’s offer shall include a term that is
coterminous with this Lease and an amount of Base Rent charged for the Available
Space that is the then Prevailing Market Rent.

 

B.     Notice; Exercise. Novavax shall give to Landlord written notice of
Novavax’s exercise of its option to so lease the Available Space within thirty
(30) days after the date on which Landlord gives Landlord’s Offer to Novavax,
which notice shall either (i) accept Landlord’s Offer on the terms set forth
therein, (ii) reject Landlord’s Offer, or (iii) accept Landlord’s Offer but
reject the Prevailing Market Rate. If Novavax accepts Landlord’s Offer but not
the Prevailing Market Rent, and if the parties do not agree within such
15-business day period, then the Prevailing Market Rent shall be determined by
the Three Broker Method. If Novavax shall fail to exercise its option to lease
the Available Space within said thirty (30) days after the date on which
Landlord’s Offer is so given by Landlord, then Landlord shall be free to offer
to lease and to lease such Available Space to others and Novavax’s right to
lease said Available Space shall be void and of no force or effect until such
time as said portion of the Available Space becomes available for lease after
the leasing of said portion of Available Space to another tenant, and Landlord
may lease said Available Space to others upon such terms and for such periods as
shall be acceptable to Landlord (it being agreed that time shall be of the
essence in Novavax’s delivery of the aforesaid notice to Landlord and that, if
such written notice is not so delivered within the time aforesaid, Landlord will
rely to its detriment on Novavax’s failure to give such written notice.

 

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C.     Execution of Lease Amendment. Within thirty (30) days (subject to written
extension by Landlord) after Landlord delivers to Novavax an amendment to this
Lease incorporating the terms as to the Available Space as determined by this
Section 44 and not otherwise modifying any of the terms of this Lease, Landlord
and Novavax shall execute such amendment to this Lease setting forth the terms
set forth in Landlord’s Offer as to the Available Space. If Novavax shall fail
to execute said Lease Amendment for the Available Space within such thirty (30)
day period (as the same may be extended as aforesaid), then Landlord shall have
the right, at Landlord’s option exercisable by written notice to Novavax: (a) to
cancel the exercise by Novavax of Novavax’s option and to offer to lease and to
lease such Available Space to others upon such terms and conditions as shall be
acceptable to Landlord, and to hold Novavax liable for any damages to Landlord
from such cancellation, or (b) to not cancel the exercise by Novavax of
Novavax’s option, in which case Novavax shall remain bound by the exercise
thereof.

 

D.     Miscellaneous Provisions. Nothing set forth in this Section 44 shall be
construed to give Novavax a superior right to lease any Available Space or any
other space in the Building that is leased to another tenant and that is subject
to any written option on the part of such other tenant to renew or extend the
term thereof. Any lease of Available Space entered into pursuant to the terms of
this Section 44 shall be effective upon the date of the amendment to this Lease
and the term thereof and the obligation to pay rental thereunder shall commence
upon the date determined pursuant to the provisions of Landlord’s Offer, as set
forth in such amendment. During the period that any Landlord’s Offer is
outstanding, Landlord may proceed with negotiations with prospective tenants
other than Novavax with respect to any or all of the Available Space in
question, provided that Landlord may only enter into leases with respect to any
such Available Space upon complying with all of the terms and conditions
regarding Novavax’s right of first offer, as set forth in this Section 44,
Novavax may only take Available Space hereunder in whole but not in part.

 

[Signatures appear on the following page.]

 

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

 

WITNESS: LANDLORD:         FIRSTFIELD HOLDCO LLC, a Delaware limited liability
company         By: Greater Washington Life Sciences Fund, L.L.C., its Sole
Member           By: Greater Washington LSF Manager, LLC, its Managing Member  
          By: /s/ Sara Martinez     By: /s/ Robert Scheer         Name: Robert
Scheer         Its: Manager

 

ATTEST: TENANT:               [Corporate seal] NOVAVAX, INC., a Delaware
corporation         By: /s/ Laura Gibbs By: /s/ Barclay Phillips Name: Laura
Gibbs Name: Barclay Phillips Its: Executive Assistant Its: SVP, CFO & Treasurer

 

 

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