Exhibit 10.1

LEASE

BETWEEN

MARRONE BIO INNOVATIONS, INC.,

a Delaware corporation

AND

SIX DAVIS, LLC,

a Delaware limited liability company

September 9, 2013

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TABLE OF CONTENTS

 

     Page  

1. Term

     1   

2. Rent

     2   

3. Security Deposit

     3   

4. Improvement of the Premises

     4   

5. Use of the Premises

     4   

6. Parking and EV Improvements

     4   

7. Repairs and Maintenance by Tenant

     5   

8. Utilities and Services – Buildings and Site

     5   

9. Repairs by Landlord

     6   

10. Entry by Landlord

     6   

11. Insurance

     6   

12. Non-Liability of Landlord

     7   

13. Alterations

     7   

14. Signs

     8   

15. Liens

     8   

16. Compliance With Regulations

     8   

17. Personal Property Taxes

     8   

18. Rules and Regulations

     8   

19. Assignments and Subletting

     8   

20. Damage to the Premises

     9   

21. Condemnation

     10   

22. Subordination and Attornment

     10   

23. Estoppel Certificate

     11   

24. Holding Over

     11   

25. Default

     11   

26. Attorneys Fees

     13   

27. Arbitration

     13   

28. Waiver

     13   

29. Successors and Assigns

     13   

30. Notices

     13   

31. Mortgage Holders Protection Clause

     14   

32. Force Majeure

     14   

33. Exculpation

     14   

34. Executive Order 13224

     14   

35. Entire Agreement

     15   

36. Governing Law

     15   

37. Severability

     15   

38. Captions

     15   

39. Consents

     15   

40. Brokers

     15   

41. Hazardous Materials

     15   

42. Option to Extend

     17   

43. Right of First Offer

     18   

44. Storage Space

     19   

45. Use of Greenhouse; Expansion or Construction of Greenhouse

     19   

46. Personal Property

     19   

47. SNDA as a Condition to Lease

     20   

48. Roof Rights

     20   

49. Sign Rights

     20   

50. Emergency Generator

     20   

51. [Intentionally Deleted]

     21   

52. Certified Access Specialist

     21   

 

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OFFICE LEASE

This Office Lease (this “Lease”), executed this 9th day of September 2013, is by
and between SIX DAVIS, LLC, a Delaware limited liability company (hereinafter
referred to as “Landlord”), and MARRONE BIO INNOVATONS, INC., a Delaware
corporation (hereinafter referred to as “Tenant”).

Witnesseth:

Whereas, Landlord is the owner of that certain real property on which is located
several office buildings having the addresses of 1530 Drew Avenue, 1540 Drew
Avenue and 1554 Drew Avenue, Davis California 95618 (hereinafter collectively
referred to as the “Buildings”).

Whereas, all office space, together with all improvements and facilities located
upon the underlying land, as shown on Exhibit A hereto shall be deemed to be the
“Office Park”; and

Whereas, Landlord desires to lease to Tenant, and Tenant desires to lease from
Landlord, certain office premises in the Buildings as delineated on the plan
attached as Exhibits B1 – B-3 hereto, (hereinafter referred to collectively as
the “Premises,” provided the premises described in Exhibit B-1 is sometimes
referred to herein as the “1530 Premises”). The portion of the Premises
described in Exhibit B-1 contains approximately 12,919 rentable square feet; the
portion of the Premises described in Exhibit B-2 contains approximately 14,416
rentable square feet; and the portion of the Premises described in Exhibit B-3
contains approximately 1,397rentable square feet; provided in no event will any
portion of the Office Park defined as the “Greenhouse” in this Lease be included
in the rentable square footage of the Premises, or be subject to the payment of
Monthly Base Rent to Landlord or other charges assessed by Landlord.

Now, therefore, Landlord hereby leases the Premises to Tenant, and Tenant hereby
leases the Premises from Landlord, for the term, at the rent, and upon and
subject to the terms and conditions hereinafter set forth.

1. Term. Unless this Lease is sooner terminated as hereinafter provided, the
initial term of this Lease shall be for the period of sixty (60) months,
commencing on the Commencement Date. Such term, as it may be extended or sooner
terminated pursuant to the provisions of this Lease, is referred to herein as
the “Term.” The “Commencement Date” shall be the later of the date of
Substantial Completion (as defined herein) of the Initial Improvements (as
defined herein), or May 1, 2014. Tenant has agreed to accept the Premises
“as-is” except for the Initial Improvements (as defined in Exhibit C to this
Lease), to be constructed by Landlord, subject to, and without limiting
Landlord’s repair, maintenance and other obligations under this Lease, including
the warranties set forth in Exhibit C and further acknowledges that (a) Landlord
has made no agreement to make any initial improvements or refurbishments to the
Premises except as set forth in Paragraph 4 below and Exhibit C with respect to
the Initial Improvements and (b) Tenant acknowledges that it has investigated
and/or been given the opportunity to investigate all matters related to the
Premises prior to the execution of this Lease, including, without limitation,
the condition of the Premises, the adequacy of systems serving the Premises, the
size of the Premises and the suitability thereof for Tenant’s use, and hereby
waives and claims it may have against Landlord related to any such matters,
other than as provided in the foregoing. If the Premises has not been delivered
with the Initial Improvements Substantially Completed by June 1, 2014 (the
“Deadline Date”), then Tenant may terminate the Lease at any time prior to
December 1, 2014 (the “Outside Date”), by written notice to Landlord if at the
time Tenant delivers such written notice, Landlord has not delivered the
Premises as required hereunder. Landlord shall use commercially reasonable
efforts to complete the Initial Improvements and cause the Commencement Date to
occur by May 1, 2014, or as soon thereafter as reasonably practicable.
Landlord’s failure to complete the Initial Improvements by the Commencement Date
shall not result in liability to Landlord, provided if the Premises are not
delivered with the Initial Improvements completed by the Deadline Date, then in
addition to Tenant’s right to terminate the Lease as provided in the foregoing,
Tenant will have the right to receive abatement of Base Rent as provided in
Paragraph 2(b), below. If the Lease shall be terminated by Tenant, then within
three (3) business days after such termination or deemed termination, Landlord
will pay to Tenant any Security Deposit or Monthly Base Rent (as each is defined
herein) paid by Tenant to Landlord prior to the date of such Termination, and
shall deliver to Tenant any original Letter of Credit (as defined herein)
previously delivered to Landlord in lieu of any Security Deposit, by the end of
such three (3) business day period. Notwithstanding that the Commencement Date
shall not have occurred, Landlord shall provide Tenant with the right to enter
the Premises, promptly after the prior tenant thereof shall

 

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vacate the Premises, and the Initial Improvements shall be completed, without
obligation to pay Monthly Based Rent, but otherwise on the terms and conditions
provided in this Lease. If the Premises is not delivered to Tenant in the
condition required herein by the Outside Date notwithstanding Landlord’s use of
commercially reasonable efforts to complete the Initial Improvements as provided
in the foregoing, then this Lease will automatically terminate.

2. Rent.

(a) Tenant shall pay to Landlord, as base rent (the “Monthly Base Rent”) for the
Premises for the initial twelve (12) months of the Term of this Lease, a monthly
amount equal to Forty Five Thousand Nine Hundred Seventy Dollars ($45,970),
subject to any credit provided in this Lease if Tenant does not expend the
entire Tenant Improvement Allowance (as defined and provided in Exhibit C)
and/or any abatement of Base Rent provided herein if Landlord does not deliver
the Premises by the Outside Date. Subject to Paragraph 2(b) below, the Monthly
Base Rent shall be payable in advance on the first day of each calendar month
during the Term of this Lease, provided such Monthly Base Rent will be subject
to increase as provided in Paragraph 2(d), below. The Monthly Base Rent shall be
in addition to all other amounts required to be paid to Landlord pursuant to the
provisions of this Lease.

(b) If the Term of this Lease commences on a date other than the first day of a
calendar month, rent for the period from the date of commencement of the Term
hereof through the last day of the calendar month in which such Term commences
shall be prorated on the basis of a thirty-day month. In the event the Term of
this Lease ends on a day other than the last day of the calendar month, rent for
the period from the first day of the last calendar month of such Term to the end
of such Term shall be prorated on the basis of a thirty-day month. One (1) full
month of Monthly Base Rent will be payable in advance upon execution of this
Lease, and shall be applied as a credit against the first installment(s) of
Monthly Base Rent due hereunder. If the Commencement Date does not occur by the
Deadline Date and the cause of the delay in the occurrence of the Commencement
Date is not attributable to Tenant’s interference with Landlord’s completion of
the Initial Improvements (it being understood that Tenant shall not be entitled
to an abatement of Monthly Base Rent for each day of any such delay attributable
to Tenant’s interference), then the Monthly Base Rent provided and reserved in
section (a) above shall be abated one (1) day for each day of delay in delivery
of the Premises to Tenant beyond the Deadline Date.

(c) The installments of rent specified herein shall be paid, without deduction
or offset, and without prior notice or demand, except as otherwise specifically
provided herein, to Landlord at 1590 Drew Avenue, Suite 200, Davis, California
95618, or at such other address as Landlord may from time to time specify by
written notice to Tenant. All amounts of money payable by Tenant to Landlord
hereunder, if not paid within a ten (10) day grace period commencing when due,
shall bear interest from the due date until paid at the rate of 7% per annum or
the highest amount allowed by applicable law, whichever is less.

(d) On the first anniversary date of the Commencement Date, (or, in the event
said first anniversary date occurs on a date other than the first day of a
calendar month, on the first day of the thirteenth (13th) full calendar month of
the Term of this Lease,) and on each succeeding anniversary date thereof, the
Monthly Base Rent for the next succeeding twelve-month period of the Term of
this Lease shall be increased by three percent so that the Monthly Base Rent for
the following twelve (12) month period will be one hundred three percent
(103%) of the Monthly Base Rent in effect in the month immediately preceding the
month in which the adjustment occurs as follows:

 

Months or Period

   Monthly Base Rent  

Months 1-12*

   $ 45,970.00 * 

Months 13-24

   $ 47,349.10   

Months 25-36

   $ 48,769.57   

Months 37-48

   $ 50,232.66   

Months 49-60

   $ 51,739.64   

 

* (plus the prorated portion for any partial month due at the commencement of
the Term).

 

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3. Security Deposit.

(a) By the Deposit Date, Tenant shall, deliver to Landlord a security deposit in
the amount of One Hundred Thousand Dollars ($100,000.00) (the “Security
Deposit”). As used herein, the “Deposit Date” means the earlier of twenty one
(21) days after the date of this Lease, or occurrence of the Commencement Date.

(b) Tenant shall have the option to deliver, in lieu of cash a Letter of Credit
(as defined herein), in the amount of the Security Deposit, on or before the
Deposit Date. The Security Deposit, whether delivered in the form of cash or a
Letter of Credit shall serve as security for the full and faithful performance
of Tenant’s obligations under this Lease. Tenant agrees and acknowledges that
any Security Deposit is not an advance rent deposit or advance payment of any
kind, nor any measure of Landlord’s damages upon default. Within thirty
(30) days after expiration of the Term or earlier termination, the Security
Deposit shall be returned to Tenant, reduced by those amounts that may be
required by Landlord to remedy defaults (beyond any applicable notice and cure
periods) on the part of Tenant in the payment of Rent, to repair damages to the
Premises caused by Tenant, to clean the Premises to the extent the Premises are
not left in the condition required under this Lease and for any other cost or
expense to which Landlord may be permitted to apply such Security Deposit under
this Lease and applicable law. If any amount of the Security Deposit is applied
by Landlord to cure any default (beyond any applicable notice and cure periods)
hereunder, then within ten (10) days after written notice from Landlord of such
application (which shall include a description of the obligation that the
Security Deposit was applied to satisfy), Tenant shall deliver to Landlord a
payment sufficient to restore the Security Deposit to the amount specified
subsection (a), as reduced pursuant to subsection (f), below.

(c) Tenant may elect to deliver an irrevocable, unconditional letter of credit,
in form and substance reasonably satisfactory to Landlord and drawn on a bank
reasonably satisfactory to Landlord in lieu of the cash Security Deposit
hereunder (a “Letter of Credit”). Landlord confirms that Five Star Bank, a New
York state chartered community bank, is a satisfactory issuing bank of the
Letter of Credit, provided the Letter of Credit shall provide that it shall be
drawable at a Five Star Bank branch location in Northern California. Any Letter
of Credit shall be in the amount of the Security Deposit from time to time as
may be reduced pursuant to subsection (f), below and shall have an expiration
date no earlier than the expiration of the Term, or if the expiration date shall
occur prior to the expiration of the Term, such Letter of Credit shall be
replaced as provided in subsection (d), below, prior to the expiration thereof.

(d) Tenant shall provide a replacement Letter of Credit at least forty-five
(45) days prior to the expiration date of any then effective Letter of Credit,
which meets the requirements of this Lease. If Tenant fails to provide such
replacement Letter of Credit, and such failure continues for ten (10) days after
Tenant receives written notice from Landlord or any First Lender of such
nonrenewal, Landlord may present, or cause to be presented, any Letter of Credit
then held by Landlord for payment, and hold the cash proceeds thereof as
security for the performance by Tenant of its obligations under this Lease,
subject to the other terms and conditions of this Paragraph 3.

(e) Any portion of the Security Deposit not applied to cure a Tenant default
(beyond any applicable notice and cure periods) hereunder, for the prepayment of
Rent, or for any other purpose permitted under this Lease shall be paid over to
Tenant (or if the Security Deposit is held in the form of a Letter of Credit,
the original Letter of Credit shall be returned) within thirty (30) days after
expiration of the Term or earlier termination hereof. Landlord shall hold the
Security Deposit for the foregoing purposes; provided, however, that Landlord
shall have no obligation to segregate the Security Deposit from its general
funds or to pay interest thereon. Tenant hereby waives any and all rights it may
have under Section 1950.7, of the Civil Code, or any successor thereto that are
inconsistent with the provisions of this Lease. If Landlord conveys or transfers
its interest in the Premises, and as a part of such conveyance or transfer,
assigns its interest in this Lease, the Security Deposit, or any portion thereof
not previously applied, shall be transferred to Landlord’s successor, and
Landlord shall be released and discharged from any further liability to Tenant
with respect to such Security Deposit.

(f) Notwithstanding the foregoing, the amount of the Security Deposit shall be
reduced to Fifty Thousand Dollars ($50,000.00), on and after the expiration of
the twelfth (12th) full calendar month, so long

 

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as no event of default (beyond applicable notice and cure periods) by Tenant
under this Lease then exists as of the date of the relevant reduction of the
Security Deposit and the date any excess Security Deposit is to be returned
hereunder. Such reduction may be accomplished by amendment of the Letter of
Credit, provided the Letter of Credit otherwise complies with the provisions of
this Lease. If the Security Deposit is held as cash, within ten (10) business
days following the date of the relevant reduction of the Security Deposit,
Landlord shall pay to Tenant any excess held by Landlord over the required
amount of the Security Deposit, as so reduced. If Landlord does not timely pay
Tenant such excess, Tenant shall have the right to credit such excess against
future payments of Monthly Base Rent under this Lease, in addition to other
remedies Tenant may have at law or in equity arising from Landlord’s failure to
timely pay.

4. Improvement of the Premises.

(a) As used in this Paragraph, “Initial Improvements” shall collectively refer
to any improvements to the Premises to be constructed by Landlord pursuant to
Exhibit C and “Substantial Completion” means the date any such Initial
Improvements are complete, except for minor or “punchlist” items and the
Premises may be legally occupied by Tenant. Tenant will in no event be required
to remove at the expiration of the Term any Tenant Improvements covered by
Approved Working Drawings (as defined in Exhibit C) and constructed by Tenant
pursuant to Exhibit C and approved by Landlord.

5. Use of the Premises. Tenant may use the Premises only for administrative,
executive, and research and development purposes, and for sales (excluding
on-site retail sales), including without limitation sales of biopesticides, as
well as plant testing in the Greenhouse (as defined herein) and for no other use
or purpose without the prior written consent of Landlord. No use shall be made
of the Premises which will increase the existing rate of insurance on the
Buildings or cause the cancellation of any insurance policy covering the
Buildings. Tenant shall not commit or suffer to be committed any waste upon the
Premises or any public or private nuisance or any other act or thing which may
disturb the quiet enjoyment of any other tenant in the Building, and shall not
use the Premises for any purpose or use that is deemed to be in violation of any
of the laws, ordinances, regulations or rules of any public authority.

6. Parking and EV Improvements.

(a) The Landlord shall provide parking in the areas shown on the site plan
attached as Exhibit A, hereto, during normal business hours, for the use of
Tenant on a non-exclusive basis, without charge, unless Landlord is required to
impose a charge pursuant to applicable laws. Said parking spaces shall be used
for parking vehicles no larger than full sized passenger automobiles or pick-up
trucks unless the prior consent of Landlord is obtained for the parking of any
other type of vehicle. Tenant will not service, or store, nor shall it allow any
of its employees to service or store overnight any vehicles in the parking
areas, except that Tenant may park overnight and store up to three
(3) company-owned cars, vans or pickup trucks or trailers, including one or more
light duty trailers suitable for transporting one or more ATV’s and/or one or
more spray rigs (but not heavy duty tractor-trailers or trailers) in the parking
areas, provided no such vehicles and/or trailers shall obstruct the drive aisles
or access to parking in the Office Park or otherwise unreasonably interfere
with, or burden the use of the parking facilities by other tenants of the Office
Park. Tenant and its employees shall comply with all reasonable rules and
regulations promulgated from time to time by Landlord relating to the use of the
parking area.

(b) Tenant may request, and Landlord will not unreasonably withhold its consent
to the installation of one or more EV charging stations in the parking areas of
the Office Park to be used by Tenant’s vehicles, provided: (a) Landlord and
Tenant will reasonably agree on the location and number of such charging
stations; (b) any and all such charging station installations shall comply with
all laws; (c) Landlord will reasonably cooperate with Tenant, at no cost to
Landlord, to obtain all permits and approvals necessary to install such charging
stations, provided the approvals will be obtained at Tenant’s cost; (d) Tenant
will pay any and all costs of installing and maintaining such charging stations
and will pay Landlord the reasonable cost of utilities used by such charging
stations, as reasonably estimated and documented by Landlord, within thirty
(30) days after Landlord shall present an invoice covering such costs; and
(e) if requested by Landlord, Tenant will remove such charging stations at the
expiration of the Term and will restore any part of the Parking Area damaged by
such removal.

 

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7. Repairs and Maintenance by Tenant. Except as otherwise provided in Paragraphs
9, 20 and 21 of this Lease, and subject to Paragraph 16 hereof, Tenant agrees at
its expense to maintain the interior of the Premises in good condition and
repair throughout the Term of this Lease, reasonable wear and tear, matters
which are the responsibility of Landlord hereunder, and damage by fire or other
casualty excepted. Landlord has no obligation and has made no promise to alter,
remodel, improve, repair, decorate or paint the Premises or any part thereof;
nor have any representations respecting the condition of the Premises or the
Buildings been made by Landlord to Tenant, except as specifically herein set
forth. Tenant shall be responsible for plumbing service calls for maintenance
resulting from Tenant’s improper acts or misuse of the plumbing system serving
the Premises. Within the Premises, Tenant shall be responsible for the cost of
any janitorial service, and for replacement and installation of light bulbs and
tubes in the Premises. Tenant shall cause the Premises to be cleaned with
sufficient frequency to preserve the neat, clean appearance of the Premises,
consistent with the quality of the Office Park.

8. Utilities and Services – Buildings and Site.

(a) Landlord shall provide site exterior lighting

(b) Landlord, at no expense to Tenant, shall maintain the parking area adjacent
to the Buildings including associated landscaped and parking areas and the
access ways thereto, in a clean and orderly condition, and shall replace any
broken plate glass windows or doors in the Buildings, unless such breakage is
caused by Tenant’s or its agents’, employees’, customers’ or invitees’ improper
acts or misuse of the Premises, in which case Tenant will pay the cost of repair
of any such damage. Landlord shall not be liable, however, for either the
failure, or delay, to furnish any of the services or utilities specified in this
Paragraph 8, or the curtailment of such services or utilities, when such failure
or curtailment is caused by conditions beyond the reasonable control of Landlord
or by accidents, strikes, repairs or improvements to Premises, or to the
Buildings, nor shall any such failure constitute a constructive eviction of
Tenant, entitle Tenant to the abatement of rent, relieve Tenant from observing
and performing any of the provisions of this Lease, or any other claims against
Landlord. Landlord is not responsible for any maintenance of the Greenhouse.
Notwithstanding the foregoing or anything to the contrary contained in this
Lease (but subject to the last sentence of this subsection (b)), Tenant shall
cease to occupy, and shall not in fact use, any Premises located in a Building
because such Premises have become unsuitable for Tenant’s use as a consequence
of a cessation of utilities or services not caused by Tenant or any of its
agents, employees or contractors for a period exceeding five (5) consecutive
days, or the presence of any Hazardous Materials not introduced to the Office
Project by Tenant or any of Tenant’s employees, agents, contractors or invitees
that shall have a material and adverse effect on Tenant’s ability to occupy its
Premises in the relevant Building, then Tenant shall be entitled to an abatement
of all rent payable hereunder for so long as Tenant does not in fact use the
relevant Premises because the Premises have become unsuitable for Tenant’s use,
and Monthly Base Rent shall be abated based on the proportion that the Premises
so affected bears to the total Premises leased hereby. If such interference
cannot be corrected or the damage resulting therefrom repaired so that the
entire Premises will be reasonably suitable for Tenant’s use within one hundred
twenty (120) days after the occurrence of such event and Tenant does not in fact
use the entire Premises for the conduct of its business during the entirety of
such period, then Tenant also shall be entitled, at the end of such one hundred
twenty (120) day period for a period of ten (10) business days hereafter to
terminate this Lease (and receive a full refund and return of its deposits and
any prepaid rent) by delivery of written notice of termination to Landlord,
unless the interfering event is abated prior to the date Tenant gives notice.
Any casualty or damage to the Premises shall be governed by Paragraph 20 hereof.

(c) [Intentionally Deleted].

(d) Subject to applicable laws, Landlord will provide reasonable amounts of
water for the uses contemplated at the Premises, provided Tenant shall pay the
costs of water/sewer for the 1530 Premises, which shall be separately metered.

(e) Tenant shall pay its own janitorial, gas and electricity costs for the
Premises, and Landlord shall bear no responsibility to supply such utilities or
services, other than water as noted in subsection (d), above. All such utilities
shall be separately metered to one or more portions of the Premises. Tenant
shall cause the Premises to be cleaned with sufficient frequency to preserve the
neat, clean appearance of the Premises.

 

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(f) Landlord shall provide Tenant with keys to the Premises, and otherwise
provide Tenant with access to the Premises twenty four (24) hours per day, seven
(7) days per week, subject to any temporary closure as reasonably required for
Landlord to carry out its repair obligations hereunder, the effect of casualty,
and disaster, riot, public disturbance or other cause prevalent in the area of
the Premises that shall result in closure of similar buildings located in the
area of the Premises.

9. Repairs by Landlord. Except as otherwise provided in Paragraph 20 hereof,
Landlord agrees at no expense to Tenant to maintain in good condition and repair
throughout the Term of this Lease the roof and roofing, exterior walls,
foundations columns, footings, load bearing walls, subfloors and the
landscaping, parking, sidewalk and other exterior areas of the Buildings, as
well as the HVAC, plumbing, electrical, life safety and all other main building
systems serving the Premises and Buildings, and the pipes and conduit for the
plumbing, gas lines, electric wiring and the fire protection loop to the point
of entry to the Premises, and the lighting ballasts located in the Buildings,
when such repair or replacement is necessitated, other than through the improper
acts or misuse of such systems or facilities by Tenant, subject to Paragraph 11
concerning waiver of subrogation rights. Landlord shall not be responsible for
damage to, or destruction of, property located on the Premises by reason of
defects in those portions of the Premises which Landlord is obligated to
maintain or replace, except for the warranties specified in Exhibit C.
Notwithstanding the foregoing, Landlord will have no obligation to maintain or
repair the equipment yard adjacent to 1530 Drew Avenue, or any fixtures or
equipment located in such equipment yard.

10. Entry by Landlord. Tenant agrees to permit Landlord to enter the Premises
accompanied by Tenant and subject to Tenant’s reasonable security requirements,
at reasonable times, with reasonable advance notice to Tenant of not less than
one (1) business day, for the purpose of inspecting the same, showing the
Premises to prospective purchasers, mortgagees, or tenants (during the last one
hundred eighty (180) days of the Term only, unless Tenant does not exercise the
Option to Extend provided in Paragraph 42 hereof, in which case Landlord will
have access for such purposes beginning on the latest date that Tenant could
exercise the Option to Extend, subject to the terms and provisions hereof),
making any necessary repairs or additions to the Premises or the Premises of
another tenant or to the Buildings and performing any work therein that may be
necessary to comply with any laws, ordinances, rules, regulations or
requirements of any public authority or of the Board of Fire Underwriters or any
similar body, or that Landlord may reasonably deem necessary to prevent waste or
deterioration in connection with the Premises, including without limitation any
repairs or other work which Tenant is obligated to make or perform under the
terms of this Lease and which Tenant has failed or neglected to make or perform
after receipt of written demand by Landlord (and the expiration of any
applicable cure periods for default hereunder) that the same be made or
performed. In the event Landlord performs any work which Tenant is obligated to
perform under the terms of this Lease, Tenant shall pay to Landlord, within
thirty (30) days from the date of receipt by Tenant of a statement therefore,
the cost incurred by Landlord in performing the same. Nothing herein shall imply
any duty on the part of Landlord to do any such work which, under any provision
of this Lease, Tenant may be required to perform and the performance thereof by
Landlord shall not constitute a waiver of any default by Tenant in failing to
perform the same. Landlord may, during the progress of any work in the Premises,
keep and store upon the Premises all necessary materials, tools, and equipment.
Landlord shall not be liable for inconvenience, annoyance, disturbance, loss of
business or other damage to Tenant by reason of making repairs or the
performance of any work in the Premises, or on account of bringing materials,
supplies and equipment to or through the Premises during the course thereof, and
the obligations of Tenant under this Lease shall not thereby be affected in any
manner whatsoever, provided that that Landlord employs commercially reasonable
efforts to minimize interference with the conduct of Tenant’s business in
connection with its entries into and/or work within the Premises.

11. Insurance. At all times during the Term of this Lease, Tenant shall maintain
in force, at its sole cost and expense, public liability insurance with combined
single limits of $1,000,000 per occurrence and $2,000,000 aggregate. Tenant
shall also procure and keep in effect during the Term, fire and extended
coverage for its furniture fixtures, and equipment, merchandise, leasehold
improvements made or constructed by Tenant, inventory, and all other items of
Tenant’s property on the Premises, written on a Specified Perils Form basis.
Such policy or policies shall be with insurers having a Best Insurance Guide
Rating of A-:VII or better and licensed to do business in California. Such
policy or policies of insurance shall be with insurers and in such form as
Landlord may reasonably approve and each such policy shall name Landlord, the
Shimon ben Joseph Foundation and Interland, LLC, as additional insureds
thereunder. All liability policies shall be primary and not contributing as to
any coverage maintained by Landlord. Without limiting the foregoing, Landlord
and all required additional insureds

 

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shall be shown as “certificate holders” under any certificate of coverage issued
in connection with Tenant’s liability policies. Any additional insured
endorsements to Tenant’s policy required to effect the foregoing coverages shall
provide coverage at least equivalent to ISO Form CG 20 10 (with respect to
Landlord, unless coverage is provided under ISO Form CG 20 11 or equivalent
coverage); ISO Form CG 20 11 (with respect to Landlord and Landlord’s property
manager) and ISO Form CG 20 26 (with respect to any entity other than Landlord
or its property manager that Landlord shall require be named as an additional
insured). Without limiting the foregoing, any endorsement provided to Landlord
hereunder to evidence additional insured liability coverage shall expressly
provide that it shall cover the concurrent negligence of the additional insured.
Tenant shall carry commercially reasonable insurance deductibles. Any
self-insurance provisions under any insurance policies maintained by Tenant that
are not specifically provided in the foregoing provisions shall be subject to
Landlord’s prior written approval. Each such property insurance policy shall
contain a waiver by the insurer thereunder of its right of subrogation against
Landlord. If an agreement to provide notice of cancellation to Landlord shall be
available from any insurer providing the above policies, at no cost to Tenant,
then the relevant policy shall provide that it may not be cancelled or the
limits of coverage materially changed, without at least ten (10) day’s prior
written notice to Landlord. If any relevant insurer will not agree to notify
Landlord of cancellation, or such agreement is only available at additional cost
to Tenant, then Tenant will provide Landlord a copy of any notice or invoice
from the insurer relating to cancellation of any relevant coverage for
nonpayment or any other reason, within five (5) business days after Tenant
receives any such notice relating to cancellation from its insurer. Tenant shall
promptly deliver a copy of certificates of insurance manifesting the required
coverage, to Landlord. Notwithstanding anything to the contrary contained in
this Lease, Landlord and Tenant hereby mutually waive their respective rights of
recovery against each other and their respective agents, employees and approved
subtenants, for any loss of, or damage to, either parties’ property that arises
out of or incident to any peril which is actually insured against, which is
required to be insured against under this Lease, or which would normally be
covered by so called “all risk” or “special form” property insurance, without
regard to the negligence or willful misconduct of the entity or party so
released or any other cause. Each party shall obtain any special endorsements,
if required by its insurer whereby the insurer waives its rights of subrogation
against the other party.

12. Non-Liability of Landlord. Tenant shall defend, indemnify, hold and save
Landlord free and harmless from any and all liability or damage caused to
property or to persons in or about the Premises arising from the use of the
Premises, Buildings or Office Park by Tenant or its agent, employees or
invitees; provided, however, that Tenant shall have no obligation to indemnify,
defend, hold or save Landlord free or harmless from any such all liability or
damage to the extent it is caused by negligence (unless covered by Tenant’s
liability insurance, including, without limitation, by operation of the
“additional insured” provisions thereof), or willful misconduct of Landlord or
any of Landlord’s agents, employees or contractors, or Landlord’s violation of
applicable law . Landlord shall not be liable for any damage, loss or injury to
the property of Tenant, or any other person, suffered on, in or about the
Premises by reason of the condition of the Premises, by reason of fire,
earthquake, action of the elements, or any other casualty, or by reason of the
act of Tenant, its agents or employees, or third persons.

13. Alterations. Tenant shall not make or permit to be made any material
alterations, changes or additions in or to the Premises without prior written
consent of Landlord; it being understood that Landlord’s consent shall not be
required for any alterations, changes or improvements that satisfies all of the
following criteria (a “Permitted Alteration”): (i) will not cost more than
Twenty Five Thousand Dollars ($25,000.00) in any year; (ii) is not visible from
the exterior of the Premises or Buildings; and (iii) it will not affect the
structural elements of the Buildings or the systems serving the Building. Such
consent shall not be unreasonably withheld. Any such approved changes or
additions shall be done either by or under the direction of Landlord at the cost
of Tenant, and excepting any trade fixtures shall become immediately the
property of Landlord, and shall remain upon and be surrendered with the Premises
upon expiration or earlier termination of the Term of this Lease. Any movable
furniture remaining on the Premises at the end of the Term hereof shall be
removed by Tenant or if not so removed, shall, at the option of Landlord, become
the property of Landlord, and may be sold or retained by Landlord without duty
to pay Tenant any amount or account to Tenant for the proceeds of any sale.
Tenant hereby waives the provisions of Civil Code 1980-1991 at they may apply to
any disposition of any personal property remaining at the Premises after a
default and agrees that (a) this Lease shall be a bill of sale with respect to
any personal property remaining on the Premises and (b) sale or other
disposition of such personal property conducted in accordance with this Lease
shall be an accepted method of disposing of such personal property in lieu of
the method provided by Sections 1980-1991 of the Civil Code.

 

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14. Signs. Tenant will be entitled to Building standard signage on the door to
the Premises where the portions of the Premises are located. Tenant will also be
entitled to exterior signage on the terms and conditions provided in Paragraph
47, below.

15. Liens. Tenant shall keep the Premises and the Buildings free from any and
all liens and claims arising out of any work performed, materials furnished or
obligations incurred by or for the account of Tenant.

16. Compliance With Regulations. At all times during the Term of this Lease,
Tenant shall comply with and conform to all laws, ordinances, regulations,
requirements and orders of all municipal and governmental bodies which relate in
any manner to the use or occupancy of the Premises; provided, however, that
Landlord, not Tenant, shall be required to perform and pay for any alterations
or improvements to the Premises or Buildings that are required to comply any
such laws, ordinances, regulations, requirements and orders unless such
alterations or improvements shall be necessitated or occasioned, in whole or in
part, by any alterations or improvements to the Premises made and paid for by
Tenant, or by the particular use of the Premises (as opposed to office and
research and development uses by tenants in general) by Tenant. The judgment of
any court of competent jurisdiction or the admission by Tenant in any action or
proceeding against Tenant, whether Landlord by a party thereto or not, that
Tenant has violated any such law, ordinance, requirement, or order in the use of
the Premises, shall be conclusive of that fact as between Landlord and Tenant.

17. Personal Property Taxes. Tenant agrees to pay, before delinquency, any and
all taxes levied or assessed against the equipment, furniture, fixtures and
other personal property of Tenant located on or about the Premises at any time
during the Term of this Lease.

18. Rules and Regulations. At all times during the Term of this Lease, Tenant
shall comply with the rules and regulations for the Buildings which are attached
as Exhibit C hereto and incorporated herein by reference. Tenant agrees that
Landlord shall have the right to make reasonable amendments to said rules and
regulations and to promulgate new, reasonable rules and regulations applicable
to all tenants in the Buildings which relate to their use and occupancy thereof.
Landlord shall not be responsible to Tenant for the nonperformance by any other
tenant or occupant of any of said rules and regulations. To the extent there is
any inconsistency between any such rules and regulations and the remaining terms
and conditions of this Lease, the remaining terms and conditions of this Lease
shall govern and control.

19. Assignments and Subletting.

(a) Tenant shall not assign this Lease or any interest hereunder, and shall not
sublet the Premises or any part thereof, or any right or privilege appurtenant
thereto, or suffer any person other than the agents and employees of Tenant to
occupy the Premises, or any portion thereof, without the prior written consent
of Landlord, which consent shall not be unreasonably withheld. Tenant will
reimburse Landlord for any reasonable, out-of-pocket legal fees or for any other
expense incurred as a consequence of Tenant’s request for approval of such
assignment or subletting. The consent of Landlord to one assignment, subletting
or occupation by any other person, shall not be deemed to be a consent by
Landlord to any subsequent assignment, subletting or occupation by another
person. Any such assignment or subletting without such consent shall be void and
shall, at the option of Landlord, be deemed to be an event of default under the
provisions of Paragraph 25 hereof. Neither this Lease nor any interest herein
shall be assignable, as to the interest of Tenant, by operation of law, without
the prior written consent of Landlord, which consent shall not be unreasonably
withheld. The foregoing notwithstanding, Tenant shall be allowed to assign,
sublease or transfer this Lease without Landlord’s approval to a wholly owned
subsidiary, affiliate, or related company.

(b) If at any time during the Term of this Lease, Tenant desires to sublease or
assign all or any part of the Premises, Tenant shall give notice to Landlord
setting forth the terms of the proposed sublease or assignment and the space so
proposed to be subleased or assigned. Within fifteen (15) days following
Landlord’s receipt of Tenant’s notice of its intent to sublease, Landlord shall
provide to Tenant its written approval or disapproval. A failure of Landlord to
respond to Tenant in writing within such fifteen (15) day period shall be deemed
Landlord’s consent of the proposed sublet or assignment defined in Tenant’s
notice.

 

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(c) No sublease or assignment shall be valid and no sublease or assignee shall
take possession of the Premises until an executed counterpart of such sublease
or assignment has been delivered to Landlord.

(d) Regardless of Landlord’s consent, no subletting or assignment shall release
Tenant of Tenant’s obligation or alter the primary liability of Tenant to pay
the rental and to perform all other obligations to be performed by Tenant
hereunder

(e) The provisions of this Paragraph notwithstanding, Tenant may assign or
otherwise transfer its interest in and to this Lease and/or sublet the Premises
or any part thereof to any Affiliate of Tenant without the necessity of
obtaining the consent of Landlord. In the event that Tenant sublets the Premises
or any part thereof to an Affiliate of Tenant in accordance with this Paragraph
19(e), Tenant shall remain primarily liable with respect to its obligations
under this Agreement and, as to sublettings to Affiliates. Tenant shall provide
Landlord with notice identifying any successor Affiliate under this provision
(which shall include a certified copy of the organizational documents of such
entity and evidence of qualification to do business in California, if such
entity is not a California entity and qualification to do business in California
is legally required for such entity), together with a copy of the assumption
documentation required under this Paragraph, within thirty (30) days after any
transfer under this subparagraph (e). As used herein, “Affiliate” means (A) any
corporation, partnership or limited liability company which directly or
indirectly controls or is controlled by or is under common control with Tenant
(for this purpose, “control” shall mean the possession, directly or indirectly,
of both the power to direct or cause the direction of the management and
policies of the entity, whether through the ownership of voting securities or
partnership shares or by contract or otherwise, when combined with the
ownership, directly or indirectly, of not less than fifty percent (50%) of all
classes of the then outstanding stock, if the entity is a corporation, or of
fifty percent (50%) of all classes of the profit interests, if the entity is a
partnership or a limited liability company); or (B) a corporation into which or
with which Tenant, its corporate successors or assigns, is merged or
consolidated in accordance with the applicable statutory provisions for merger
or consolidation of corporations, but only if, by operation of law or by
effective provisions contained in the instruments of merger or consolidation,
the liabilities and obligations of the corporations participating in such merger
or consolidation are assumed by the corporation surviving the merger or created
by such consolidation; (C) any partnership or limited liability company into
which Tenant is merged in accordance with the applicable statutory provisions
for the merger of partnerships or limited liability companies; or (D) any
corporation, partnership or limited liability company acquiring the leasehold
interest of Tenant under this Lease and substantially all of the other property
and assets of Tenant. In addition, Tenant may, without consent of but with
notice to Landlord, sublease no more than twenty five percent (25%) of the
leaseable area of the Premises to any entity with whom Tenant is undertaking or
will undertake a joint venture or similar joint research and development,
marketing, distribution, sales or development project at the Premises, so long
as any improvements made for the benefit of the subtenant, including, without
limitation, any such improvements that may be required to separately demise the
subleased premises, will be subject to Landlord’s approval under Paragraph 13
hereof.

20. Damage to the Premises.

(a) In the event any portion of the Premises is damaged by fire, earthquake,
action of the elements or any other casualty, and such damage can be repaired
and the Premises restored to their former condition within one hundred eighty
(180) days from the date of such damage, then, unless otherwise provided in
subparagraph (b) hereof, Landlord shall, at its expense, proceed immediately to
make such repairs. However, Landlord’s obligation to repair shall not include
any alterations, improvements, or additions to the Premises made by Tenant or
any of Tenant’s furniture, equipment or other personal property. Such partial
destruction shall not serve to terminate this Lease, but Tenant shall be
entitled to a proportionate abatement of the installments to rent payable during
the period commencing on the date of such partial destruction and ending upon
completion of all such repairs or the termination of this Lease, which abatement
shall be based upon the portion of the Premises rendered unsuitable for use by
Tenant during such period.

(b) In the event (i) any portion of the Premises is damaged by fire, earthquake,
action of the elements or any other casualty, and such damage cannot be repaired
and the Premises restored to their former condition within one hundred eighty
(180) days from the date of such damage, (ii) the Buildings are damaged by any
such casualty and the cost of repairing such damage will exceed fifty percent
(50%) of the replacement cost (exclusive of foundations) of the Buildings, or
(iii) such damage exceeds $100,000 and is not covered by the property insurance

 

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Landlord is required to carry under this Lease or actually carries on the
Buildings (excluding any deductibles carried by Landlord), Landlord may, at its
option, elect to terminate this Lease as of the date of the occurrence of such
damage, provided if Landlord elects to so terminate, Tenant may, within ten
(10) business days after it receives Landlord’s notice, notify Landlord that it
wishes to fund any deficiency required to reconstruct the Premises (a “Notice of
Reconstruction”) . In the event Landlord fails to exercise said option to
terminate by written notice to Tenant within thirty (30) days from the date of
occurrence of such damage, Landlord shall promptly undertake to restore the
Premises and the Buildings to their former condition. Tenant shall be entitled
to a proportionate abatement of the installments of rent payable during the
period commencing on the date of such damage and ending upon completion of all
such repairs or the termination of this Lease, which abatement shall be based
upon the portion of the Premises rendered unsuitable for use by Tenant during
such period. If Tenant delivers a Notice of Reconstruction, then Landlord and
Tenant will have forty five (45) days following the date of delivery of the
Notice of Reconstruction to agree on the cost of reconstruction and the security
to be provided by Tenant for payment of such costs and manner of disbursement
thereof, which may include, without limitation, deposit of funds with Landlord
sufficient to effect such reconstruction within a time to be agreed between the
parties following the conclusion of negotiations, to be disbursed upon
conditions to be satisfactory to both parties. If at the end of such forty five
(45) day period, the parties are unable, despite good faith efforts, to agree
upon the reconstruction cost or the manner in which the costs of reconstruction
are to be funded by Tenant, then Landlord may terminate the Lease by written
notice to Tenant. If Tenant shall fail to fund reconstruction as required under
any agreement between the parties related to reconstruction, or if the parties
agree that Tenant shall perform the restoration, and Tenant fails to restore as
agreed, such failure will be a default under this Lease after applicable notice
and cure periods.

(c) Notwithstanding the provisions of subparagraphs (a) and (b) of this
Paragraph 20, in the event any portion of the Premises is damaged by fire,
earthquake, action of the elements or any other casualty, and (i) such damage
cannot be repaired and the Premises restored to their former condition within
one hundred eighty (180) days from the date of such damage, and Landlord does
not exercise its right to terminate the Lease under subsection (b), above, then
Tenant shall have the right to terminate this Lease by written notice to
Landlord within sixty (60) days from the date of such damage or (ii) if neither
Landlord nor Tenant has elected to exercise a right such party may have under
this Paragraph 20 to terminate this Lease, and for any reason the repairs to the
Premises are not completed within two hundred seventy (270) days after the date
of such damage, and such repairs remain incomplete within thirty (30) days after
Landlord’s receipt of Tenant’s notice, then at any time thereafter until such
damage is fully repaired, Tenant may terminate this Lease by a further notice to
Landlord, and in either case, after Tenant has paid any rents, costs or fees
that are past due, Tenant shall have no further obligation to pay rent under
this Lease.

21. Condemnation. In the event all or a substantial portion of the Premises
shall be taken or condemned under power of eminent domain, or by purchase in
lieu thereof, this Lease shall terminate as of the date possession of that
portion of the Premises so taken, condemned or purchased is surrendered to the
condemning or purchasing authority or body. If this Lease is not terminated,
(i) Monthly Base Rent and all other elements of this Lease which are dependant
upon the area of the Premises or the Buildings shall be appropriately adjusted
to account for any reduction in the square footage of the Premises or Buildings,
as applicable; and (ii) Landlord, at Landlord’s expense, shall make all
necessary repairs to the Premises or Buildings so as to constitute the remaining
Premises a complete architectural unit. If this Lease is terminated under this
Paragraph 21, all compensation awarded or paid upon such condemnation or
purchase shall belong to and be the sole property of Landlord; provided,
however, that any portion of the compensation awarded or paid for or on account
of any moving and relocation costs for Tenant, loss of business or goodwill by
Tenant or for damage to, or the cost of removal or relocation of, the furniture,
fixtures and equipment of Tenant, shall be paid to and retained by Tenant.

22. Subordination and Attornment. Tenant agrees that it shall, promptly upon the
request of Landlord at any time or times during the Term of this Lease, execute
and deliver such documents and other instruments as Landlord may reasonably
require and as may otherwise be reasonably satisfactory to Tenant, to cause this
Lease to be and become subject and subordinate to any mortgage or deed of trust,
and any renewal, extension, replacement or modification thereof, covering the
real property on which the Buildings are located, provided that such mortgage or
deed of trust shall contain provisions to the effect that so long as Tenant
shall not be in default (beyond any applicable notice and cure periods) in the
performance of any obligations to be performed by Tenant hereunder, the
mortgagee, trustee or beneficiary, as the case may be, shall not terminate this
Lease or the interest of

 

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Tenant in the Premises through foreclosure of such mortgage or deed of trust,
and shall not disturb the possession and use of the Premises by Tenant. In
connection with the foregoing, a subordination, nondisturbance and attornment
agreement in the form of Exhibit D, with no material modifications shall be
deemed satisfactory to Tenant. Tenant agrees that in the event of the
enforcement, by judicial foreclosure, exercise of the power of sale, or
otherwise, of any mortgage or deed of trust covering the real property on which
the Buildings are located by the mortgagee, trustee or beneficiary thereunder of
thereof, as the case may be, Tenant shall automatically become the lessee of any
successor in interest in title to said real property as a result of such
enforcement, without change in the terms of this Lease. Tenant further agrees
that upon request of any such successor in interest, Tenant will execute and
deliver to such successor in interest an instrument or instruments confirming
such attornment.

23. Estoppel Certificate. Tenant agrees that it shall, from time to time at the
request of Landlord, and within ten (10) days after such request, execute,
acknowledge and deliver to Landlord a statement in writing certifying, if such
be the case, that this Lease is unmodified and in full force and effect or, if
this Lease has been modified, that it is in full force and effect as so
modified, the date of commencement of the Term of this Lease, the due date of
the last installment of rent paid by Tenant to Landlord, and such other
information as Landlord may reasonably request. Tenant understands that any such
statement may be delivered by the Landlord to, and relied upon by, prospective
purchasers of any of the Buildings and by existing or prospective mortgagees or
beneficiaries under mortgages or deeds of trust covering the Buildings in which
the Premises are located.

24. Holding Over. In the event Tenant shall hold the Premises after the
expiration of the Term hereof with the express or implied consent of Landlord,
such holding over shall be deemed to have created a tenancy from month to month,
terminable on thirty (30) days notice by either party to the other, at a monthly
rental equal to one hundred twenty-five percent (125%) of the Monthly Base Rent
due for the last month of the Term, and otherwise subject to all of the terms
and provisions of this Lease.

25. Default. In the event that:

(a) Tenant shall default in the payment of rent or any other amounts required
hereby to be paid by Tenant to Landlord hereunder, including, without
limitation, any failure by Tenant to restore the Security Deposit when required
hereunder, when the same shall become due, or shall fail to deliver a
replacement letter of credit when required under Paragraph 3 hereof, and such
default shall continue for a period of ten (10) consecutive days after Tenant’s
receipt of written notice of delinquency from Landlord, provided if Landlord is
required to provide more than two (2) such notices in any twelve (12) month
period then for twelve (12) months following the date of the first notice,
Tenant will be in default if rent is not paid when due without any requirement
of notice; or

(b) Tenant shall abandon the Premises for a period of thirty (30) consecutive
days while it is in default of its monetary obligations under this Lease; or

(c) Tenant shall default in the performance of any obligation required to be
performed by Tenant under this Lease (other than abandonment or the payment of
rent or any other amounts required hereby to be paid by Tenant hereunder) and
shall fail, for a period of twenty (20) days after written notice from Landlord
specifying such default, to cure said default (unless such default cannot be
cured within twenty (20) days, in which case Tenant shall commence to cure said
default within said twenty (20) days and shall cure the same with all reasonable
dispatch); or

(d) [Intentionally Deleted]; or

(e) Tenant shall be adjudicated bankrupt or a petition by or against Tenant for
reorganization or adjustment of its obligations under the Bankruptcy Act or any
other existing or future insolvency or bankruptcy statute shall be approved, or
Tenant shall make a general assignment of its property for the benefit of
creditors, or a receiver or trustee shall be appointed to take control of the
business or assets of Tenant, and any of the foregoing are not dismissed within
sixty (60) days thereafter;

Then and in each such case Landlord may, at its option, terminate this Lease, or
without terminating this Lease and to the extent allowed by applicable law and
subject to all applicable legal due process requirements,

 

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re-enter the Premises and for the account of Tenant relet the same or any
portion or portions thereof for all or any part of the unexpired Term of this
Lease upon such terms and conditions as Landlord may elect. In the event of any
such termination of this Lease by Landlord, Landlord shall be entitled to
recover from Tenant (i) the worth at the same time of award of the unpaid rent
which had been earned at the time of termination (ii) the worth at the time of
award of the amount by which the unpaid rent which would have been earned after
termination until the time of award exceeds the amount of such rental loss that
Tenant proves could have been reasonably avoided; (iii) the worth at the time of
award of the amount by which the unpaid rent for the balance of the Term after
the time of award exceeds the amount of such rental loss that Tenant proves
could be reasonably avoided; and (iv) any other amount necessary to compensate
Landlord for all detriment proximately caused by Tenant’s failure to perform
Tenant’s obligations under this Lease or which in the ordinary course of things
would be likely to result therefrom. Efforts by Landlord to mitigate the damages
caused by Tenant’s breach of this Lease shall not constitute a waiver by
Landlord of its right to recover damages hereunder. The “worth at the time of
award” of the amounts referred to in (i) and (ii) shall be computed with
interest at ten percent (10%) per annum or the highest lawful rate, whichever is
the lower. The “worth at the time of award” of the amount referred to in
(iii) shall be based upon competent appraisal evidence and the lowest discount
rate permitted under applicable law (or one percent (1%) above the “discount
rate” in effect as published by the Federal Reserve Bank of San Francisco as of
the date of default, if no such rate is provided). In the event of such
reletting without terminating this Lease, Landlord shall be entitled to recover
from Tenant monthly the difference between the monthly installments of rent and
such other amounts as may be payable by Tenant to Landlord pursuant to the
provisions hereof over the total monthly rental received by Landlord upon such
reletting, after first deducting therefrom all expenses reasonably incurred by
Landlord in such reletting and in repairing, renovation, remodeling and altering
the Premises for the purpose of such reletting. Landlord shall not be deemed to
have elected to terminate this Lease or the liability of Tenant to pay rent
thereafter to accrue or its liability for damages under any of the provisions
hereof by any such re-entry or by any action in unlawful detainer or otherwise
to obtain possession of the Premises, unless Landlord shall have notified Tenant
in writing that it has so elected to terminate this Lease. For purposes of this
Paragraph 25, the following shall not constitute termination of Tenant’s right
to possession: (A) acts of maintenance or preservation or efforts to relet the
Premises; or (B) the appointment of a receiver upon initiative of Landlord to
protect the Landlord’s interest under this Lease. Nothing herein contained shall
be construed as obligating Landlord to relet the whole or any part of the
Premises. In the event of any entry or taking possession of the Premises in
accordance with all applicable due process requirements under California law,
Landlord shall have the right, but not the obligation to remove therefrom all or
any part of the personal property located therein and may place the same in
storage at a public warehouse selected by Landlord at the expense and risk of
the owner or owners thereof. The remedies provided Landlord hereunder shall be
cumulative and shall be in addition and supplemental to all other rights or
remedies which Landlord may lawfully pursue in the event of any breach or
threatened breach by Tenant of any of the provisions of this Lease.

(f) Landlord shall not be deemed in breach of this Lease unless Landlord fails
within a reasonable time to perform an obligation required to be performed by
Landlord. For purposes of this Paragraph 25(f), a reasonable time shall in no
event be more than thirty (30) days after receipt by Landlord, and by any
Mortgagee(s) whose name and address shall have been furnished to Tenant in
writing for such purpose, of written notice specifying wherein such obligation
of Landlord has not been performed; provided, however, that if the nature of
Landlord’s obligation is such that more than thirty (30) days after such notice
are reasonably required for its performance, then Landlord shall not be in
breach of this Lease if performance is commenced within such thirty (30) day
period and thereafter diligently pursued to completion. If Landlord is in
default pursuant to this Paragraph 25(f), and (i) such default materially and
adversely impairs Tenant’s ability to use all or a substantial part of the
Premises for its operations pursuant to the terms of this Lease, or (ii) poses a
material and imminent risk to the health or safety of persons, then
notwithstanding anything to the contrary contained in this Lease, Tenant may
perform such obligations subject to the following terms and conditions:

(i) Tenant shall deliver to Landlord a written notice (“Self-Help Notice”) of
Tenant’s intention to perform such obligations, which Self-Help Notice shall
indicate Tenant’s intention to exercise its self-help rights and to perform such
obligations which are otherwise Landlord’s responsibility hereunder (it being
understood that not such additional notice or additional Landlord cure period
shall be required if the default poses a material and imminent risk to the
health or safety of persons). If Landlord fails to commence to cure its failure
to perform within ten (10) days after receipt of the Self-Help Notice, Tenant
may take whatever action is reasonably necessary to perform such obligations;

 

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(ii) All work performed by Tenant or its agents in accordance with this
Paragraph 25(f) must be performed at a reasonable and competitive cost and rate;
and

(iii) Landlord shall reimburse Tenant for the reasonable costs of such
performance incurred in accordance with the terms of this Paragraph 25(f) within
thirty (30) days after Tenant’s submission to Landlord of receipted invoices
therefor (accompanied by reasonable supporting documentation). If Landlord fails
to reimburse Tenant within such thirty (30)-day period, then Tenant may withhold
from future rentals due hereunder the sum owed Tenant, until Tenant is
reimbursed in full for the sum plus interest at the rate of seven percent
(7%) per annum or the highest amount allowed by applicable law, whichever is
less.

26. Attorneys Fees. In the event any action or proceeding is instituted at any
time by either party hereto against the other for the purpose of determining or
enforcing the rights of either party, the party prevailing in such action shall
be entitled to recover from the other party all costs reasonably incurred by the
prevailing party in connection with such action or proceeding, including the
reasonable fees of its attorneys as determined by the court.

27. Arbitration. At the option of either the Landlord or Tenant, any controversy
or dispute arising under the terms or provisions of this Lease (with the
exception of unlawful detainer, bodily injury/wrongful death, and
foreclosure-related actions, and matters within Small Claims Court jurisdiction)
shall be determined by arbitration. Such arbitration shall be conducted pursuant
to the provisions of the laws of the State of California then in force
applicable to such proceedings and to the extent not inconsistent therewith, the
rules of the American Arbitration Association.

28. Waiver. No waiver of any default of Tenant or Landlord hereunder shall be
implied from any omission by the other party hereto to take any action on
account of such default, and no express waiver affect any default other than the
default specified in the express waiver. Any waiver of any covenant, term or
condition of this Lease by a party hereto shall not be construed as a waiver of
any subsequent breach by such party of the same covenant, term or condition. The
consent or approval by Landlord to any act by Tenant requiring the consent or
approval of Landlord shall not be deemed to waive or render unnecessary the
consent or approval of Landlord to any subsequent similar acts of Tenant.

29. Successors and Assigns. Subject to the provisions of Paragraph 19 hereof,
this Lease and all of the provisions hereof shall bind and inure to the benefit
of the successors and assigns of each of Landlord and Tenant.

30. Notices. Any notice or other written instrument relating to this Lease may
be delivered personally to the party to whom such notice is addressed (delivery
to the President, a Vice President, or the Secretary of such party to constitute
personal delivery to such party), or may be mailed by registered or certified
mail at the following address or at such other address as such party from time
to time may designate by written notice:

 

TO LANDLORD:      Six Davis, LLC      1590 Drew Avenue, Suite 200      Davis, CA
95616 TO TENANT:      Prior to the Commencement Date:      Marrone Bio
Innovations, Inc.      2121 Second Street, Suite B-107      Davis, CA 95618     
Attn: Chief Financial Officer      After the Commencement Date:      Marrone Bio
Innovations, Inc.      At the Premises      Attn: Chief Financial Officer

 

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Any notice or other written instrument mailed as above provided shall be
effective at the expiration of three (3) business days after deposit of the
same, postage prepaid, in the United States mail at any place within the State
of California.

31. Mortgage Holders Protection Clause. Tenant agrees to give any mortgagee,
trustee or beneficiary, by registered mail, a copy of any notice of default,
served upon the Landlord, provided that prior to such notice Tenant has been
notified in writing (by way of Notice of Assignment of Rents and Leases, or
otherwise), of the addresses of such mortgagees, trustees or beneficiaries.
Tenant further agrees that if Landlord shall have failed to cure such default,
then the mortgagees, trustees or beneficiaries shall have thirty (30) days
within which to cure such default, or if such default cannot be cured within
that time, then such additional time as may be necessary if within such thirty
(30) days, any mortgagee, trustee or beneficiary has commenced and is diligently
pursuing the remedies necessary to cure such default (including but not limited
to commencement of foreclosure proceedings if necessary to effect such cure), in
which event this Lease shall not be terminated while such remedies are being so
diligently pursued. However if the relevant default consist of a failure to
repair a Building system, or to remedy a condition at or in any Building, and
failure to repair or remedy shall continue for thirty (30) days after Tenant
provides notice to the mortgagee trustee or beneficiary of such failure, then
Tenant may exercise the remedies provided in Paragraph 25(f) hereof applicable
to a Landlord default.

32. Force Majeure. If Landlord or Tenant cannot perform any of its obligations
due to events beyond Landlord’s or Tenant’s reasonable control (other than for
financial reasons), the time period for performing such obligations shall be
extended by a period of time equal to the duration such events. Events beyond
Landlord’s and Tenant’s control include, but are not limited to, acts of God,
war, civil commotion, labor disputes, strikes, fire, flood or other casualty,
shortages of labor or material, government regulation or restriction and weather
conditions.

33. Exculpation. The obligations of Landlord and Tenant under this Lease do not
constitute personal obligations of the individual shareholders, partners or
members of the entities which constitute Landlord and Tenant, and Tenant shall
look solely to the real estate that is the subject of this Lease and any sales,
condemnation and insurance proceeds payable to Landlord therefrom and to no
other assets of Landlord for satisfaction of any liability in respect of this
Lease and will not seek recourse against the individual shareholders, partners
or members of the entity which is Landlord, nor against any of their personal
assets, for such satisfaction. Further, Tenant recognizes that in connection
Landlord’s ownership of the Buildings and/or Office Park, and the sale,
encumbrance or other transfer of the Buildings and/or Office Park, Landlord may
be required by law or in the exercise of Landlord’s prudent business judgment,
to make certain disclosures of information regarding The Building, Office Park
and/or the tenants thereof, including without limitation, financial statements
of Tenant in the possession of Landlord, reports or disclosures regarding
hazardous substances or materials used at the Buildings and/or Office Park
received by Landlord from Tenant or other tenants of the Buildings and/or Office
Park, and/or use of energy by Tenant and other tenants of the Buildings and/or
Office Park or other or energy conservation measures or monitoring policies or
procedures at the Buildings and/or Office Park, and Tenant hereby authorizes
Landlord to make any such disclosures and waives any claims arising from the
disclosure of such information, unless disclosure is made contrary to any
written nondisclosure agreement executed by Landlord and Tenant, provided,
however that Landlord will negotiate in good faith to agree to a written
nondisclosure agreement covering any information that Tenant is required to
deliver or delivers to Landlord under this Lease that Tenant identifies in
writing as confidential and that Tenant wishes to be subject to such written
nondisclosure agreement. Upon transfer by Landlord of its interest in the
Buildings and/or Office Park, no liability or obligations first accruing
thereafter under this Lease shall thereafter accrue against the transferring or
assigning person as Landlord hereunder.

34. Executive Order 13224. To each party hereto’ s current actual knowledge,
such party and all persons or entities holding any equity ownership interest
whatsoever in such are not included in, owned by, controlled by, acting for or
on behalf of, providing assistance, support, sponsorship, or services of any
kind to, or otherwise associated with any of the persons or entities referred to
or described in Executive Order 13224 –

 

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Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten
to Commit, or Support Terrorism, as amended. Each party hereto will promptly
give notice to the other party if becomes aware that it or any persons holding
an equity interest in such party shall at any time during the term of the Lease
be described in, covered by or specially designated pursuant to or be affiliated
with any person described in, covered by or specially designated pursuant to
Executive Order 13224, as amended, or any similar list issued by the Office of
Foreign Asset Control (“OFAC”) or any other department or agency of the United
States of America. Further, if either party hereto becomes aware of or receives
any notice of any violation of the foregoing covenant and agreement (an “OFAC
Violation”), such party will within twenty (20) days thereafter use commercially
reasonable efforts to comply with all laws applicable to such OFAC Violation,
including, without limitation, Executive Order 13224; the International
Emergency Economic Powers Act, 50 U.S.C. Sections 1701-06; the Iraqi Sanctions
Act, Pub. L. 101-513, 104 Stat. 2047-55; the United Nations Participation Act,
22 U.S.C. Section 287c; the Antiterrorism and Effective Death Penalty Act,
(enacting 8 U.S.C. Section 219, 18 U.S.C. Section 2332d, and 18 U.S.C.
Section 2339b); the International Security and Development Cooperation Act, 22
U.S.C. Section 2349 aa-9; the Terrorism Sanctions Regulations, 31 C.F.R. Part
595; the Terrorism List Governments Sanctions Regulations, 31 C.F.R. Part 596;
and the Foreign Terrorist Organizations Sanctions Regulations, 31 C.F.R. Part
597 (collectively, the “Anti-Terrorism Regulations”). Tenant will provide such
reasonable evidence as Landlord may request from time to time to evidence
compliance with the foregoing.

35. Entire Agreement. This Lease contains all of the agreements and
understandings relating to the leasing of the Premises and the obligations of
Landlord and Tenant in connection with such leasing. Neither Landlord nor Tenant
has made, and neither Tenant nor Landlord is relying upon, any warranties, or
representations, promises or statements made by the other party or by any agent
of the other party, except as expressly set forth herein. This Lease supersedes
any and all prior agreements and understandings between Landlord and Tenant and
alone expresses the agreement of the parties.

36. Governing Law. This Lease shall be governed by, and construed in accordance
with, the laws of the state of California.

37. Severability. In the event any provision of this Lease is found to be
unenforceable, the remainder of this Lease shall not be affected, and any
provision found to be invalid shall be enforceable to the extent permitted by
law. The parties agree that in the event two different interpretations may be
given to any provision hereunder, one of which will render the provision
unenforceable, and one of which will render the provision enforceable, the
interpretation rendering the provision enforceable shall be adopted.

38. Captions. All captions, headings, titles, numerical references and computer
highlighting are for convenience only and shall have no effect on the
interpretation of this Lease.

39. Consents. Unless otherwise set forth herein, to the extent any approval or
consent of a party is required hereunder, such party shall not unreasonably
withhold or delay such approval or consent. Landlord covenants and warrants to
Tenant that Landlord holds fee title to the Office Park and has the right to
enter into this Lease, subject only to the consent of its lender.

40. Brokers. Landlord and Tenant each warrant and represent to the other party
that it has not voluntarily incurred, on its behalf or on behalf of both
Landlord and Tenant, any obligation to pay a commission or finder’s fee to any
real estate broker or other person or entity in connection with this Lease.
Landlord and Tenant shall each indemnify, defend and hold the other party
harmless from claims for any commission or finders fee charges by any real
estate broker or other person or entity arising from an agreement, whether
express or implied, between the indemnifying party and such broker or other
person or entity or otherwise arising from the conduct of the indemnifying party

41. Hazardous Materials. Neither Tenant nor any of its agents, employees,
contractors or invitees shall introduce any Hazardous Material upon, in or about
the Leased Premises without the prior written consent of Landlord, except such
materials in such amounts as commonly found in business office and research and
development uses of the type engaged in by Tenant and in strict accordance with
applicable laws. “Hazardous

 

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Material” shall mean any (A) oil, flammable substances, explosives, radioactive
materials, hazardous wastes or substances, toxic wastes or substances or any
other wastes, materials or pollutants which (1) pose a hazard to the Office Park
or to persons on or about the Office Park or (2) cause the Office Park to be in
violation of any Hazardous Materials Laws; (B) asbestos in any form, urea
formaldehyde foam insulation, transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls, or radon gas;
(C) chemical, material or substance defined as or included in the definition of
“hazardous substances,” “hazardous wastes,” “hazardous materials,” “extremely
hazardous waste,” “restricted hazardous waste,” or “toxic substances” or words
of similar import under any applicable local, state or federal law or under the
regulations adopted or publications promulgated pursuant thereto, including, but
not limited to, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, 42 U.S.C. 9601, et seq.; the Hazardous
Materials Transportation Act, as amended, 49 U.S.C. 1801, et seq.; the Federal
Water Pollution Control Act, as amended, 33 U.S.C. 1251, et seq.; Sections
25115, 25117, 25122.7, 25140, 25249.8, 25281, 25316, 25501, and 25316 of the
California Health and Safety Code; and Article 9 or Article 11 of Title 22 of
the Administrative Code, Division 4, Chapter 20; (D) other chemical, material or
substance or organism, exposure to which is prohibited, limited or regulated by
any governmental authority or may or could pose a hazard to the health and
safety of the occupants of the Office Park or the owners and/or occupants of
property adjacent to or surrounding the Office Park, or any other person coming
upon the Office Park or adjacent property; and (E) other chemicals, materials or
substances which may or could pose a hazard to the environment. “Hazardous
Materials Laws” shall mean any federal, state or local laws, ordinances,
regulations or policies relating to the environment, health and safety, and
Hazardous Materials (including, without limitation, the use, handling,
transportation, production, disposal, discharge or storage thereof) or to
industrial hygiene or the environmental conditions on, under or about the
Project, including, without limitation, soil, groundwater and indoor and ambient
air conditions. “Hazardous Materials Claims” shall mean any enforcement,
cleanup, removal, remedial or other governmental or regulatory actions,
agreements or orders instituted pursuant to any Hazardous Materials Laws; and
any claims made by any third party against Landlord, Tenant or the Office Park
relating to damage, contribution, cost recovery compensation, loss or injury
resulting from the presence, release or discharge of any Hazardous Materials in
violation of Hazardous Materials Laws. If Tenant breaches its obligations stated
in this Paragraph, or if Tenant or any of its agents, employees, contractors or
invitees introduces Hazardous Materials to the Premises in violation of
applicable Hazardous Materials Laws, then Tenant shall indemnify, defend,
protect and hold Landlord harmless from any and all claims, judgments, damages,
penalties, fines, costs, liabilities or losses (including, without limitation,
diminution in value of the Premises, damages for the loss or restriction on use
of rentable or usable space or of any amenity of the Premises, damages arising
from any adverse impact on marketing of space, and sums paid in settlement of
claims, attorneys’ fees, consultants’ fees and experts’ fees) and Hazardous
Materials Claims which arise during or after the Lease term as a result
therefrom. This indemnification of Landlord by Tenant includes, without
limitation, costs incurred in connection with any investigation of site
conditions or any clean-up, remedial, removal or restoration work required by
any federal, state or local governmental agency or political subdivision because
of Hazardous Material present in the soil or ground water on or under the
Premises or Office Park as a result of Tenant’s or any of its agents, employees,
contractors or invitees violation of applicable Hazardous Materials Laws. The
foregoing indemnity shall survive the expiration or earlier termination of this
Lease. Tenant will comply with all Hazardous Material Laws with respect to the
handling of Hazardous Materials, including, without limitation, maintaining
Materials Safety Data sheets and other record and disclosures. If Landlord shall
have a reasonable basis upon which to conclude that the Premises may be
contaminated with Hazardous Materials, then on or before the expiration of the
Term, including any early termination thereof, Landlord may, at Tenant’s
expense, enter the Premises and conduct a survey thereof to determine the
presence of such Hazardous Materials. Such survey shall be at Landlord’s sole
cost and expense, provided Tenant shall pay the cost of the survey (i) if the
survey finds evidence of the use of Hazardous Materials in the Premises by
Tenant in violation of applicable Hazardous Materials Laws; or (ii) the survey
is a single survey to be conducted within six (6) months of the expiration of
the Term for the purposes of confirming if the Premises contains Hazardous
Materials in violation of applicable Hazardous Materials Laws. Landlord
represents and warrants that as of the date of this Lease, it knows of no
Hazardous Materials present in, on or about the Premises or the Office Park in
any amount or levels that would violate any applicable Hazardous Materials Laws.
Notwithstanding the foregoing or anything to the contrary contained in this
Lease, under no circumstance shall Tenant be liable for, or obligated to
indemnify, protect, defend or hold harmless Landlord from or against, any
claims, judgments, damages, penalties, fines, costs, liabilities or losses
(including, without limitation, diminution in value of the Premises, damages for
the loss or restriction on use of rentable or usable space or of any amenity of
the Premises, damages arising from any adverse impact on marketing of space, and
sums paid in settlement of claims, attorneys’ fees, consultants’ fees and
experts’ fees) arising out of or in connection with any Hazardous Materials

 

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present at any time on or about the Premises or the Office Park, or the
violation of any Hazardous Materials Laws, except to the extent that any of the
foregoing results from the introduction of Hazardous Materials on or about the
Premises by Tenant or any of its agents, employees, contractors or invitees in
violation of applicable Hazardous Materials Laws. Landlord shall indemnify,
protect, defend and hold harmless Tenant from and against any and all damages,
liabilities, judgments, costs, claims, liens, expenses, penalties, loss of
permits and attorneys’ and consultants’ fees arising out of or involving any
introduction of any Hazardous Materials by Landlord or any of its agents,
employees, contractors or invitees in violation of applicable Hazardous
Materials Laws. The foregoing indemnity shall survive the expiration or earlier
termination of this Lease.

42. Option to Extend. Landlord grants to Tenant two (2) successive options (each
an “Extension Option” and collectively the “Extension Options” ) to extend the
term for a period of five (5) years, each. As used herein, “Extended Term” means
the Term, as extended by any Extension Options duly exercised by Tenant. All the
provisions of the Lease shall apply during each Extended Term, except for the
amount of the Monthly Base Rent or any amount of tenant improvements installed
in connection with Tenant’s initial occupancy. The Monthly Base Rent for the
Extended Term shall be determined in accordance with subsection (e), below. The
Extension Option is further subject to the following terms and conditions:

(a) Tenant must deliver its irrevocable written notice of Tenant’s exercise of
the Extension Option (“Exercise Notice”) to Landlord no earlier than twelve
(12) months and not less than nine (9) months prior to the expiration of the
initial Term or then current Extend Term, as applicable. Additionally, in the
case of the second Extension Option it shall be a condition to the exercise
thereof that Tenant shall have exercised the first Extension Option. Time is of
the essence with respect to the time period during which Tenant must deliver to
Landlord its written notice of exercise and, therefore, if Tenant fails to give
Landlord its irrevocable written notice of its exercise of the applicable
Extension Option within the applicable time period provided above, then such
Extension Option shall expire and be of no further force or effect.

(b) If Tenant is in default beyond any applicable grace or cure period under
this Lease at the date of delivery of Tenant’s Exercise Notice to Landlord, then
such Exercise Notice shall be of no effect and this Lease shall expire at the
end of the initial Term or first Extended Term, as applicable. If Tenant is in
default beyond any applicable grace or cure period under this Lease on the last
day of the initial Term or the first Extension Term, as applicable, then
Landlord may in its sole discretion elect to have Tenant’s exercise of the
applicable Extension Option be of no effect, in which case the Lease shall
expire at the end of the initial Term or first Extended Term, as the case may
be.

(c) The Extension Options are personal to Tenant and may not assigned in
connection with any assignment under this Lease and will not inure in favor of
any subtenant, provided if Tenant assigns or sublets in a transaction that does
not require the consent of Landlord, Tenant’s successor will have the benefit of
any unexercised Extension Options.

(d) The Base Rent for the Extended Term shall be the “Extension Rent.” The
“Extension Rent” means ninety five percent (95%) of the Fair Market Rent,
determined as provided herein, if applicable, if the parties are negotiating
without a broker entitled to payment of a commission exercise of the relevant
Extension Option or one hundred percent (100%) of the Fair Market Rent, if the
parties are negotiating with a broker entitled to payment of a commission
exercise of the relevant Extension Option. “Fair Market Rent” shall mean the
average base rent per square foot, including any relevant escalations over the
proposed extension term charged in arm’s length transactions to renewing and new
tenants in the market area where the Buildings are located for a comparable
amount of space in comparable buildings of comparable quality required for an
extended term . Any such comparison shall take into consideration the provisions
of this Lease and any leases in such comparable buildings regarding payment of
operating costs (i.e., “net” vs. “gross” or “base year”) and the base rent per
square foot shall be adjusted as appropriate to reflect any difference in the
payment of operating cost, and taking into account items that professional real
estate brokers and professional real estate appraisers customarily consider,
including, not limited to, space availability, tenant size, the
credit-worthiness of the tenant and the tenant improvement allowance, if any.

 

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(e) Within thirty (30) days after Landlord’s receipt of the Exercise Notice,
Landlord shall provide Tenant with a notice stating Landlord’s determination of
the Extension Rent Landlord believes applicable to the Leased Premises. Tenant
shall have twenty (20) days (the “Tenant’s Review Period”) after receipt of
Landlord’s notice of the new rental within which to accept such Extension Rent,
in which case the parties shall enter into an amendment to the Lease providing
for the extension of the Lease on all of the terms and conditions provided
herein, with the Extension Rent as the Monthly Base Rent for the Extended Term.
In the event Tenant fails to accept in writing such Extension Rent proposed by
Landlord then such proposal shall be deemed rejected, and Landlord and Tenant
shall attempt to agree upon the Extension Rent, using their best good faith
efforts. If Landlord and Tenant fail to reach agreement within ten (10) days
following Tenant’s Review Period then such determination shall be submitted to
arbitration in accordance with subsections (1) through (5) below (the
“Arbitration Procedure”).

(1) If the Landlord and Tenant do not mutually agree upon the Extension Rent
within the time period specified above, then, within ten (10) business days
after Tenant’s actual or deemed rejection of the Extension Rent proposed by
Landlord, Landlord and Tenant shall each appoint a single arbitrator who shall
by profession be a real estate broker who shall have been active over the ten
(10) year period ending on the date of such appointment in the leasing of
commercial office property similar in quality, location and use to the Buildings
in the vicinity of the Buildings.

(2) Such arbitrators shall agree on a third arbitrator to determine the
Extension Rent. The decision of the third arbitrator shall be limited solely to
the issue of whether the rental rate for the Leased Premises submitted by
Landlord’s arbitrator or Tenant’s arbitrator is the closest to the actual
Extension Rent for the Leased Premises as determined by the arbitrator selected
by them, taking into account the factors listed in the definition of Extension
Rent in this Lease.

(3) The third arbitrator shall, within fifteen (15) days after his or her
appointment, schedule a meeting with the arbitrators appointed by both parties.
Each of Landlord’s and Tenant’s arbitrators shall submit their respective
opinions of the Extension Rent (including such detail as each such arbitrator
shall determine, in its discretion), in a sealed envelope to the third
arbitrator selected by the two arbitrators. Such arbitrator shall select either
the Extension Rent submitted by Tenant’s arbitrator or Landlord’s arbitrator
within three (3) business days after such meeting (provided such arbitrator
shall not consult with any party after submittal of the sealed envelopes) and
shall notify Landlord and Tenant of the Extension Rent as determined by such
arbitrator.

(4) If the Landlord’s arbitrator and Tenant’s arbitrator fail to agree upon and
appoint an arbitrator, then the appointment of the arbitrator shall be made
within fifteen (15) days after such failure by the Presiding Judge of the
Superior Court of the county where the Buildings are located or, if he or she
refuses to act, by any judge having jurisdiction over the parties. If either
Landlord or Tenant fails to appoint an arbitrator within the time period
specified in subparagraph (1) above, then the arbitrator appointed by one of
them shall within ten (10) business days following the date on which the party
failing to appoint an arbitrator could have last appointed such arbitrator reach
a decision on the Extension Rent based upon the same procedures as set forth
above and shall notify Landlord and Tenant thereof, and such arbitrator’s
decision shall be binding upon Landlord and Tenant and neither party shall have
the right to reject the decision or to undo the exercise of the applicable
Extension Option.

(5) The parties shall each pay their own arbitrators and the cost of the third
arbitrator shall be paid by Landlord and Tenant equally.

(f) Landlord and Tenant shall, promptly after determination of the Extension
Rent, enter into an amendment to the Lease providing for the extension of the
Lease on all of the terms and conditions provided herein, except for the amount
of the Monthly Base Rent as determined by the arbitrators or determined as
otherwise provided in this Lease, as the Monthly Base Rent for the Extended
Term.

43. Right of First Offer.

(a) In the event that a certain portion of 1554 Drew Avenue known as Suite 100
and more particularly described on Exhibit G (the “ROFO Space”) shall be
available for lease at any time during the period commencing

 

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on the Commencement Date but prior to the last full year of the Term, and
Landlord shall determine to make available for lease such space, Tenant shall
have a right of first offer on such space, on the terms provided in this
Paragraph. It shall be a condition to Tenant’s exercise of its right of first
offer that there shall be no event of default under the Lease beyond any
applicable cure and notice periods at the time Tenant exercises its right of
first offer.

(b) If the ROFO Space shall become available during the time Tenant shall have
rights therein under this Paragraph, and Landlord shall decide to make available
for lease such space, Landlord shall provide a notice thereof ( a “ROFO Notice”)
to Tenant. The ROFO Notice shall contain the following terms which shall be
applicable to the lease of the ROFO Space: (i) the Monthly Base Rent per square
foot shall be the same as the Monthly Base Rent per square foot then applicable
to the Premises, including any increases to the date of such exercise and
thereafter; (ii) Tenant shall be offered an allowance of $59,570, to be spent on
improvement of the Premises by Tenant and/or design of such improvements, as
elected by Tenant, or if Tenant elects to not use any portion of such allowance,
such portion of the allowance may be used as an offset against Monthly Base Rent
until exhausted; and (iii) the effective date that the ROFO Space shall be added
to the Premises if Tenant accepts Landlord’s offer to lease the ROFO Space
(“ROFO Space Commencement Date”). If accepted, the ROFO Space shall be added to
the Premises for the remaining Term of the Lease effective as of the later of
the ROFO Space Commencement Date or the date Landlord delivers the ROFO Space to
Tenant.

(c) Tenant shall, within ten (10) business days after receipt of the ROFO
Notice, notify Landlord whether it wishes to accept the ROFO Space on the terms
specified in the ROFO Notice (the “Notice of Exercise”). If Tenant does not
accept the ROFO Space on the terms specified in the ROFO Notice, then Landlord
shall be free to lease the ROFO Space to any third party, and shall not be
required to re-offer same to Tenant at any time after the date of the ROFO
Notice.

44. Storage Space. In the event that Storage Space No. 8 located at 1921 Galileo
Court (the “Storage Space”), which consists of approximately six hundred
(600) square feet of storage space shall become available during the Term,
Landlord shall provide a notice to Tenant indicating that the Storage Space is
available. Tenant shall, within ten (10) business days after it receives such
Landlord’s notice, indicate whether it desires to accept the Storage Space,
provided if Tenant does not respond to Landlord’s notice, Tenant will be deemed
to have declined to lease the Storage Space. If Tenant accepts the Storage
Space, the rent for the Storage Space shall be $375 per month, provided such
rent shall be increased by 3% each year, on the same date that Monthly Base Rent
is adjusted hereunder, and the term of the lease of the Storage Space shall be
co-terminus with the term of the Lease, including any extensions thereof. Tenant
will comply with any reasonable rules and regulations promulgated by Landlord
with respect to the use of the Storage Space.

45. Use of Greenhouse; Expansion or Construction of Greenhouse. In the event
that the tenant of the Premises in occupancy on the date that this Lease is
executed shall not remove the greenhouse shown on Exhibit F (the “Greenhouse”)
as of the expiration of its lease, Tenant shall have the right to use such
Greenhouse, free of Monthly Base Rent and other charges by Landlord throughout
the Term, provided any improvements thereof required for Tenant’s use and/or any
rehabilitation of such Greenhouse required to permit such use shall be at
Tenant’s sole cost and expense. Further, if for any reason the Greenhouse is
removed prior to the Commencement Date, then Tenant shall have the right to
rebuild such Greenhouse at Tenant’s cost and expense and use the Greenhouse free
of Monthly Base Rent and any other charges by Landlord throughout the Term.
Further Tenant may construct an additional greenhouse adjacent to the existing
in Greenhouse in a location subject to Landlord’s approval in Landlord’s
reasonable discretion (if constructed, a “Second Greenhouse”), without any
requirement to pay additional Base Rent (but Landlord may impose a reasonable
charge, not to exceed Landlord’s reasonable estimate of its increased utility
costs, for any increased use of utilities by the Second Greenhouse). Tenant’s
construction and use of the Greenhouse and any Second Greenhouse shall be in
compliance with all applicable laws, including building and zoning regulations.
Without limiting the foregoing, the provisions of this Lease with respect to
Hazardous Materials will apply to Tenant’s use of the Greenhouse and any Second
Greenhouse.

46. Personal Property. Promptly after the existing tenant of the Premises shall
vacate the Premises, Landlord shall provide Tenant with notice that the Premises
are available for inspection and will use reasonable efforts to schedule such
inspection with Tenant. At the time of such inspection Tenant may designate, in
a writing

 

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to be delivered to Landlord within three (3) business days following the date of
such inspection, which, if any, of the items of personal property remaining in
the premises Tenant desires to use (and Landlord will promptly remove prior to
the Commencement Date of this Lease any personal property that Tenant does not
elect to use and repair any damage to the Premises caused by such removal). If
Tenant designates any such items of personal property, Landlord shall not be
required to remove such items and will make such items available for Tenant’s
use, subject to any casualty, theft or damage beyond the reasonable control of
Landlord, provided Tenant’s use of the personal property will be at Tenant’s
sole cost, risk and expense, and at no additional charge to Tenant.

47. SNDA as a Condition to Lease. Landlord represents and warrants to Tenant
that there are no mortgage(s), deed(s) of trust, ground lease(s) or other
lien(s) (collectively, “Mortgages”) encumbering the Buildings or Office Park as
of the date of this Lease, except for AEGON USA Realty Advisors, Inc. Tenant’s
obligations under this Lease will be conditioned on its receipt of a binding
subordination, nondisturbance and attornnment agreement in the form of Exhibit E
attached hereto or other commercially reasonable form providing that Tenant’s
possession of the Premises and this Lease, including any options to extend the
Term hereof, will not be disturbed so long as Tenant is not then in default
(beyond any applicable notice and cure periods) and Tenant attorns to the record
owner of the Premises, executed by Landlord and AEGON USA Realty Advisors, Inc.
within forty-five (45) days after the date by which this Lease has been fully
executed and mutually delivered by Landlord and Tenant. If Landlord fails to
deliver such subordination, nondisturbance and attornnment agreement on or
before such forty-five (45)-day period, Tenant may terminate this Lease within
ten (10) days thereafter unless such agreement is obtained prior to termination,
and in the event of such termination, Landlord will return all prepaid Monthly
Base Rent and Security Deposit to Tenant and neither party shall have further
obligation under this Lease. It Tenant does not terminate the Lease within such
ten (10) day period, it will be deemed to have waived its right to terminate.

48. Roof Rights. Tenant may install a single satellite dish, antenna or other
standard communication device and may install one or more solar collectors or
panels for use by Tenant on the roofs of each of the Buildings for purposes of
use thereof by Tenant and. Such installation access will be conditioned upon the
following: (a) Tenant will follow Landlord’s reasonable rules and regulations
with respect to access to any portion of the Buildings outside the Premises,
including, without limitation, the roof and will avoid any action that will
affect or void the roof warranty; (b) the plans and specifications for any
improvements or apparatus to be installed by Tenant will be subject to the
reasonable approval of Landlord; (c) except to the extent caused by the
negligence or willful misconduct of Landlord or Landlord’s agents, employees or
contractors, Tenant will indemnify, defend and hold harmless Landlord from any
and all claims losses or liability arising from the installation and use of
Tenant’s equipment, including, without limitation, any roof leaks or damage to
the roof membrane and (d) if requested by Landlord, Tenant will remove any
facilities or equipment at the expiration of the Term and restore any damage
(ordinary wear and tear and damage caused by casualty excepted), at Tenant’s
sole cost, as an obligation that will survive termination of this Lease.

49. Sign Rights. Provided any such signs for comply with all applicable laws
ordinances and regulations, Tenant may install one or more signs on the exterior
of any building as to which Tenant leases seventy five percent (75%) or more of
the leaseable area and/or monument signs, consistent with the existing monument
signs, or reasonably approved by Landlord, that shall identify Tenant and the
Premises. Any such signs shall be subject to the reasonable approval of Landlord
and shall be reasonably consistent with the appearance and quality of the Office
Park. If Tenant installs any signs, Tenant will be solely responsible for
maintaining and repairing such signs and for all costs of operating and/or
lighting the relevant signs, and will install any meter necessary to document
Tenant’s use of utilities at Tenant’s sole cost and expense. Tenant will remove
any and all monument or exterior signs installed by Tenant pursuant to the
foregoing, and will restore the Premises to the condition existing prior to the
installation of any such signs, prior to the expiration of the Term, ordinary
wear and tear and damage caused by casualty excepted. Tenant’s restoration
obligation will survive termination of the Lease.

50. Emergency Generator. Tenant may, at its sole cost and expense, install a
generator of reasonable size and configuration, to provide backup power to the
Premises. Any such installation will be done at Tenant’s sole cost and expense,
and shall be contained within the Premises and outside exterior areas, subject
to Landlord’s approval, not to be unreasonably withheld. Tenant will comply with
any and all applicable laws relating to the use of any such emergency generator,
including, without limitation, any Hazardous Materials Laws and/or any air
quality laws applicable to the operation of any such emergency generator.

 

20

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51. [Intentionally Deleted].

52. Certified Access Specialist. The Premises have not been inspected by a
Certified Access Specialist.

 

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the date
set forth in the first paragraph of this Lease.

 

“LANDLORD” SIX DAVIS, LLC, a Delaware limited liability company By:   Interland
Growth, L.P., a Delaware limited partnership, Member   By:   Interland Capital,
Inc., a Delaware corporation, General Partner     By:  

/s/ Donald C. Lewis

      Donald C. Lewis, President

 

“TENANT”

MARRONE BIO INNOVATIONS, INC.,

a Delaware corporation

By:  

/s/ Pamela G. Marrone

Name:  

Pamela G. Marrone

Its:  

CEO/Founder

 

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EXHIBITS

 

EXHIBIT “A”    OFFICE PARK EXHIBIT “B-1”    PREMISES LOCATED AT 1530 DREW AVENUE
EXHIBIT “B-2”    PREMISES LOCATED AT 1540 DREW AVENUE EXHIBIT “B-3”    PREMISES
LOCATED AT 1554 DREW AVENUE EXHIBIT “C”    WORK AGREEMENT EXHIBIT “D”    RULES
AND REGULATIONS EXHIBIT “E”    SUBORDINATION, NONDISTURBANCE AND ATTORNMENT
AGREEMENT EXHIBIT “F”    GREENHOUSE EXHIBIT “G”    ROFO SPACE

 

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EXHIBIT “A”

OFFICE PARK

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EXHIBIT “B-1”

PREMISES LOCATED AT 1530 DREW AVENUE

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EXHIBIT “B-2”

PREMISES LOCATED AT 1540 DREW AVENUE

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EXHIBIT “B-3”

PREMISES LOCATED AT 1554 DREW AVENUE

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EXHIBIT “C”

WORK AGREEMENT

1. LANDLORD DELIVERY. Landlord shall deliver the Premises in broom clean
condition, containing any Personal Property that Tenant accepts hereunder, and
with all Building Systems serving the Premises in good operating condition and
repair. The Premises shall, as of the date of delivery comply with all
governmental codes and other governmental requirements including the Americans
with Disabilities Act, all Hazardous Materials permits obtained by any prior
occupant of the Premises shall be closed out with all applicable governmental
authorities (such close out procedures shall include, without limitation, the
completion of any required remediation work), and the roof shall be in
watertight condition. Any improvements made by Landlord to place the Premises in
the aforementioned condition are the “Initial Improvements” Landlord hereby
warrants for a period of twelve (12) months that the Premises, the Building
Systems serving the Premises and the Initial Improvements will be free of
material defects, and for the Term of this Lease that the Premises, the Building
Systems serving the Premises and the Initial Improvements will be free of latent
material defects. If Tenant notifies Landlord of any such defects in a timely
fashion, Landlord shall promptly make or cause to be made any repairs necessary
to remedy such defects at no cost or expense to Tenant.

2. TENANT IMPROVEMENT ALLOWANCE. Landlord shall contribute up to $350,000 (the
“Tenant Improvement Allowance”) toward the cost of designing and constructing
the improvements shown in the Approved Working Drawings (as defined below) (the
“Tenant Improvements”). No portion of the Tenant Improvement Allowance may be
used to pay for furniture, fixtures, equipment, voice/date and security alarm
systems, moving expenses or blinds, all of which shall be paid for solely by
Tenant.

3. TENANT IMPROVEMENTS- PLANNING.

(a) Space Plan. Landlord and Tenant shall, after execution of this Lease, agree
on a space plan for the Premises to be prepared by an architect (“Architect”)
reasonably acceptable to Landlord (the “Final Space Plan”).

(b) Approved Working Drawings. Tenant shall cause the Architect and its
engineers to complete the architectural and engineering drawings for the
Premises in a form that is complete to allow the Contractor (as defined herein)
and the subcontractors to bid on the work and obtain applicable permits
(collectively, the “Final Working Drawings”) and shall submit a complete copy of
the same to Landlord, for Landlord’s reasonable approval. Landlord shall advise
Tenant within five (5) business days after Landlord’s receipt of the Final
Working Drawings for the Premises if the same is unsatisfactory or incomplete in
any respect. If Tenant is so advised, Tenant shall revise the Final Working
Drawings in accordance with such review and any disapproval of Landlord in
connection therewith. The foregoing process shall be repeated up to a maximum of
three (3) times until the parties have agreed on the form of Final Working
Drawings (the “Approved Working Drawings. If Landlord disapproves of the Final
Working Drawings, then Landlord shall deliver to Tenant its written explanation
for such disapproval and the parties shall negotiate in good faith to reach
agreement on such drawings and budget. After approval by Landlord of the Final
Working Drawings, Tenant may submit the same to the City where the Premises is
located for all applicable building permits. Neither Landlord nor Landlord’s
consultant shall be responsible for obtaining any building permit or certificate
of occupancy for the Premises required for any Tenant Improvements constructed
by Tenant, and obtaining the same shall be Tenant’s responsibility. Landlord
shall cooperate with Tenant in executing permit applications and performing
other ministerial acts reasonably necessary to enable Tenant to obtain any such
permit or certificate of occupancy. No changes, modifications or alterations in
the Approved Working Drawings may be made without the prior written consent of
Landlord, which consent shall not be unreasonably withheld. Notwithstanding
anything to the contrary in this Work Letter, Tenant may make changes to the
Approved Working Drawings and Landlord shall not have any right to approve such
Tenant changes to extent such work (i) is required by the City of Davis or other
applicable governmental body having jurisdiction over the Tenant Improvements,
and (a) is consistent with the design intent of the approved Working Drawings
and (b) will not cost more than Five Thousand Dollars ($5,000) per occurrence;
or (ii) consists

 

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of minor field changes that (a) are consistent with the intent or required for
the proper execution of the Approved Working Drawings, and (b) will not
materially adversely affect the design, use, or operation of the Premises or
Tenant Improvements. If any Change Order is not approved or disapproved by
Landlord in writing within five (5) business days after Landlord’s receipt of
written request by Tenant, such Change Order shall be deemed approved.
Additionally, if Landlord disapproves of the Change Order, then Landlord shall
deliver to Tenant its written explanation for such disapproval and the parties
shall negotiate in good faith to reach agreement on the item proposed. With
respect to Change Orders that Landlord has no right to approve, Tenant shall
nevertheless provide prompt written notice to Landlord of the type, scope and
cost of the change.

4. CONSTRUCTION OF THE TENANT EXTRA IMPROVEMENTS.

(a) Tenant’s Selection of Contractors.

(i) The Contractor and Approved Contractors. Tenant shall retain a licensed
general contractor (the “Contractor”), as contractor for the construction of the
Tenant Improvements under a Guaranteed Maximum Price Contract (the “Contract”).
The Contractor and all HVAC, plumbing and electrical subcontractors used by
Tenant (such subcontractors, and the Contractor to be known collectively as the
“Approved Contractors”). Harrison Construction and Osborne Builders shall be
deemed pre-approved by Landlord, provided any other contractor will be subject
to the approval of Landlord, not to be unreasonably withheld or delayed. Tenant
shall inform Landlord of the identity of Contractor and the Approved Contractors
selected to perform construction of the Tenant Improvements. Tenant will provide
Landlord with a copy of the final Contract. The Contract will provide that at
all times prior to completion of the work, a retainage of at least five percent
(5%) of the total “hard costs” of the work shall be retained by Tenant (the
“Retainage”). The Contract will further provide that the Retainage will not be
paid until thirty (30) days after all Tenant Improvements have been
substantially completed.

(b) Construction of Tenant Extra Improvements by the Approved Contractors.

(i) Landlord’s General Conditions for the Approved Contractors and Tenant
Improvement Work. Tenant and the Approved Contractors in the construction of the
Tenant Improvements shall comply with the following: (A) the Tenant Improvements
shall be constructed substantially in accordance with the Approved Working
Drawings; (B) Tenant and the Approved Contractors shall not, unreasonably
interfere with any other work in the Buildings; and (C) Tenant shall abide by
all reasonable rules made by Landlord’s Building contractor or Landlord’s
Building manager and their respective agents.

(ii) Indemnity. Tenant’s indemnity of Landlord as set forth in the Lease shall
also apply with respect to any and all costs, losses, damages, injuries and
liabilities related in any way to any act or omission of Tenant or the Approved
Contractors in connection with the construction of the Tenant Improvements, or
anyone directly or indirectly employed by any of them in connection with the
construction of the Tenant Improvements, or in connection with Tenant’s
non-payment of any amount arising out of the Tenant Improvements. Such indemnity
by Tenant, as set forth in the Lease, shall also apply with respect to any and
all costs, losses, damages, injuries and liabilities related in any way to
Landlord’s performance of any ministerial acts reasonably necessary (i) to
permit Tenant to complete the Tenant Improvements, and (ii) to enable Tenant to
obtain any building permit or certificate of occupancy for the Leased Premises.

(iii) Insurance Requirements.

(1) General Coverages. All of the Approved Contractors shall carry worker’s
compensation insurance covering all of their respective employees and shall also
carry public liability insurance, including property damage, all with limits, in
form and with companies as are required to be carried by Tenant as set forth in
the Lease, and all liability policies shall name Landlord and Landlord’s
managing agent as additional insureds, and all property coverages shall insure
Landlord and Tenant, as their interests may appear.

(2) Special Coverages. Tenant shall carry a builder’s risk policy covering the
cost of the Tenant Improvements. All of the Approved Contractors who perform
work in the Leased Premises shall carry Products and Completion Operations
Coverage insurance, each in amounts not less than $500,000 per incident,

 

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$1,000,000 in aggregate, automobile liability in the amount of at lease $500,000
per incident, provided each of the foregoing coverages shall be in form and with
companies as are required to be carried by Tenant as set forth in the Lease of
which this Exhibit is a part. Certificates for all insurance carried pursuant to
this section shall be delivered to Landlord before the commencement of
construction of the Tenant Improvements and before the Contractor’s equipment is
moved onto the site. In the event that the Tenant Improvements are damaged by
any cause during the course of the construction thereof, and as long as the
Lease remains in full force and effect Tenant shall repair the same at Tenant’s
sole cost and expense.

(iv) Governmental Compliance. The Tenant Improvements shall comply in all
respects with the following: (1) all applicable laws and other state, federal,
city or quasi-governmental laws, code, ordinances and regulations, as each may
apply according to the rulings of the controlling public official, agent or
other person; (2) applicable standards of the American Insurance Association and
the National Electrical Code; and (3) building material manufacturer’s
specifications.

(v) Inspection by Landlord. Landlord shall have the right to inspect the Tenant
Improvements at all reasonable times, provided however, that Landlord’s failure
to inspect the Tenant Improvements shall in no event constitute a waiver of any
of Landlord’s rights hereunder nor shall Landlord’s inspection of the Tenant
Improvements constitute Landlord’s approval of the same. Landlord shall promptly
notify Tenant in writing of any defects or deviations in, and/or disapproved by
Landlord of, the Tenant Improvements, provided same shall be rectified by
Tenant, at no expense to Landlord. If the relevant matter has a material,
adverse effect on any Building system, Tenant will have twenty (20) days
following a Landlord’s notice that shall specify the relevant defect, to
commence to cure the relevant defect, and Landlord may elect to correct any such
defect on Tenant’s behalf and an Tenant’s cost, only if Tenant does not commence
to cure within such twenty (20) day period or if, having commenced a cure
following notice from Landlord, Tenant fails thereafter to diligently pursue
cure of such matter. If Landlord corrects any defect hereunder after providing
Tenant with the notice and cure period specified herein, Landlord may deduct the
cost of performing such work from the Tenant Improvement Allowance.

(c) Updated Approved Working Drawings. At the conclusion of construction,
(A) Tenant shall cause the Contractor, to make field notes and otherwise update
the Approved Working Drawings as necessary to reflect all changes made to the
Approved Working Drawings during the course of construction, and (B) certify to
its knowledge that the “record-set” of as-built drawings are true and correct,
which certification shall survive the expiration or termination of this Lease.
Tenant shall provide Landlord with either (a) two (2) copies of each updated or
annotated set of Approved Working Drawings; or (b) one copy of same in a
generally accepted electronic format acceptable to Landlord promptly after
preparation of the same.

5. [Intentionally Deleted].

6. PAYMENT OF TENANT IMPROVEMENT ALLOWANCE. Landlord shall contribute up to the
Tenant Improvement Allowance toward the cost of designing and constructing the
Tenant Improvements. For the purposes hereof, the cost of the Tenant
Improvements shall include, without limitation, all building permit fees and all
preparatory work and the cost of any construction management firm hired by
Tenant. The Tenant Improvement Allowance shall be paid as follows:

(a) Tenant may request disbursement of the Tenant Improvement Allowance on a
progress payment basis (a “Disbursement”). Any request for a Disbursement shall
be accompanied by certification of the Tenant that the Tenant Improvements for
which disbursement is requested have been completed (and in the case of the
Final Disbursement, that all of the Tenant Improvements have been substantially
completed), copies of paid invoices showing cost paid, in at least the amount
requested by Tenant, as well as waivers of lien from all contractors,
subcontractors or suppliers of materials to the Tenant Improvements, in form and
substance satisfactory to Landlord in its reasonable discretion (which shall be
final and unconditional in the case of the Final Disbursement of the Tenant
Improvement Allowance hereunder (the “Final Disbursement”)). The aggregate
amount of all Disbursements from time to time outstanding hereunder will not at
any time will not exceed (x) the lower of (i) the Tenant Improvement Allowance
or (ii) the Guaranteed Maximum Price specified in the Contract, multiplied by
(y) the percentage completion of the work, determined by Landlord in Landlord’s
reasonable discretion (the “Maximum Outstanding”). Upon satisfaction of the
foregoing conditions, Landlord shall make any Disbursement up to the Maximum
Outstanding hereunder. The Final Disbursement, which may include any amount of
Retainage required

 

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to be released to the Approved Contractor, shall not be required to be made
sooner than thirty (30) days following completion of the Tenant Improvements.
Landlord may not deduct from the Tenant Improvement Allowance, and is not
charging, any construction administration fee for the Tenant Improvements.

(b) Any amount of the Tenant Improvement Allowance that is not expended by
Tenant on Tenant Improvements shall be available as a credit against Monthly
Base Rent up to the full remaining balance thereof.

7. REPRESENTATIVES.

(a) Tenant’s Representative. Tenant has designated Julie Morris as its sole
representative with respect to the matters set forth in this Exhibit, who, until
further notice to Landlord, shall have full authority and responsibility to act
on behalf of the Tenant as required in this Exhibit.

(b) Landlord’s Representative. Landlord has designated Tom Shipley as its sole
representative with respect to the matters set forth in this Exhibit, who, until
further notice to Tenant, shall have full authority and responsibility to act on
behalf of the Landlord as required in this Exhibit.

 

C-4

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EXHIBIT “D”

RULES AND REGULATIONS

1. The sidewalks and entrances shall be used only as a means of ingress and
egress and shall remain unobstructed at all times. The entrance and exit doors
of all suites are to be kept closed at all times except as required for orderly
passage to and from a suite. Loitering in any part of the Buildings or
obstruction of any means of ingress and egress shall not be permitted. Doors and
windows shall not be covered or obstructed.

2. Plumbing fixtures shall not be used for any purposes other than those for
which they were constructed and no rubbish, newspapers, trash or other
substances of any kind shall be deposited therein. The use of electrical current
shall not exceed safety standards established in the applicable building code.
Walls, floors and ceilings shall not be defaced in any way and no tenant shall
be permitted to mark, nail, screw or drill into, paint, or in any way mar any
building surface, except that pictures, whiteboards, certificates, licenses and
similar items normally used in Tenant’s business may be carefully attached to
the walls in a manner prescribed by the Landlord. Upon removal of such items by
Tenant, any damage to the walls or other surfaces shall be repaired by Tenant.

3. No awning, shade, sign, advertisement, or notice shall be inscribed, painted
or affixed on or to any part of the outside or inside of the Building, except
for approved signage more specifically described in Paragraphs 14 and 47 of this
Lease. Window coverings may be installed provided they are of such color,
material, and construction and installation as may be reasonably prescribed by
Landlord. All tenant identification on public corridor doors, or walls will be
installed by Landlord for Tenant. No lettering or signs other than the name of
the Tenant will be permitted on public corridor doors, or walls, with the size
and type of letters to be prescribed by Landlord. The bulletin board or
directory of the Buildings will be provided exclusively for the display of the
name and location of the tenants thereof, and the Landlord reserves the right to
exclude all other names therefrom. Landlord reserves the right to approve all
listing requests.

4. The weight, size, position, and installation of all safes and other unusually
heavy objects used or placed in the Buildings shall be reasonably prescribed by
Landlord. All mechanical equipment and office machines which are placed in the
Buildings shall be installed in sittings which, in the reasonable judgment of
Landlord, shall be sufficient to prevent noise, vibration, and annoyance. The
repair of any damage done to the Buildings or property therein by installing or
removing or maintaining of such safes or other unusually heavy objects shall be
paid for by Tenant.

5. In no event will Landlord be responsible for any loss or damage to such
freight, furniture, and fixtures or personal property, from any cause.

6. The storage of goods, wares, or merchandise on the premises will not be
permitted except in areas specifically designated by Landlord for storage. No
auction, public or private, will be permitted on premises.

7. All keys to the premises and the Buildings shall be obtained from Landlord
and all keys shall be returned to Landlord upon termination of this Lease.
Tenant shall not change locks or install other locks on the doors without
Landlord’s prior written approval, which approval shall not be unreasonably
withheld.

8. Landlord reserves the right at any time to change or rescind any one or more
of these Rules or Regulations or to make such other and further reasonable rules
and regulations as in Landlord’s judgment may from time to time be necessary for
the management, safety, care, and cleanliness of the Building, for the
preservation of the good order therein, and for the convenience of other
occupants and tenants therein. Landlord shall not be responsible to Tenant or to
any other person for the non-observance or violation of the Rules and
Regulations by any other tenant or other person.

9. Tenant agrees not to keep or permit to be kept on said premises or in said
Office Park, any pet, including but not limited to dogs, cats, birds, rodents,
or reptiles (other than service animals, such as “seeing-eye” dogs) without the
express written consent of Landlord.

 

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EXHIBIT “E”

SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENT

THIS SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENT (“Agreement”) made
and entered into as of the      day of             ,         , by and between
                     (“Lender”), and                                          
(“Lessee”).

WHEREAS, Lender is the owner of and holds a mortgage loan (the “Loan”) from
                     (the “Lessor”) secured by a mortgage or deed of trust (the
“Mortgage”) on the land described on Exhibit “A,” together with present or
future improvements (the “Real Property”); and

WHEREAS, Lessor has entered into a lease with Lessee as to all or a portion of
the Real Property dated the      day of             ,          (which lease
together with all amendments, options, extensions, renewals and replacements is
the “Lease”); and

WHEREAS, Lender and Lessee have reached certain agreements as to the
subordination of that Lease to the Mortgage, as to Lessee’s attornment to Lender
and as to Lender nondisturbance of Lessee; and

WHEREAS, the parties desire to set forth in writing their agreements.

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants
herein contained, which the parties agree and acknowledge constitute good and
adequate consideration, the parties mutually agree as follows:

1. Subordination. The Lease, all of its terms and provisions, and all of the
Lessee’s rights thereunder and as to the Real Property shall be and are
subordinate to the Mortgage.

2. Consent to Assignment. The Lessee consents to the assignment of the Lease to
Lender as security for the Loan.

3. Notice to Lender in the Event of Lessor Default. If Lessor defaults under the
Lease and, upon notice, fails to cure its default within the cure period
provided under the Lease, Lessee will notify Lender of the default and afford
Lender a reasonable opportunity to cure the default before terminating the Lease
or exercising any self-help rights from which a right of setoff would arise,
provided that Lessee’s inadvertent failure to do so shall not affect the
enforceability of this Agreement, but no such notice shall be binding on Lender
unless and until it receives notice of Lessor’s default.

4. New Owner Obligations. If Lender forecloses the Loan, or acquires title to
the Real Property by deed in lieu of foreclosure, the following terms and
conditions will govern the respective rights and obligations of Lessee and
Lender or other new owner of the Real Property (in either case, the “New
Owner”). Neither the New Owner or anyone claiming by, through or under the New
Owner:

 

  (a) will be bound by any purchase rights of the Lessee contained in the Lease,
including but not limited to options to purchase and rights of first refusal to
purchase the Premises or Buildings.

 

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  (b) will as to matters arising prior to the date New Owner acquires title to
the Real Property, assume any of Lessor’s liabilities to Lessee arising from
any: (i) Lessor default, act or omission; or (ii) Lease indemnification or hold
harmless provisions; provided, however, that such New Owner shall be responsible
for curing any prior defaults of Lessor that are of a continuing nature, such as
repair and maintenance obligations.

 

  (c) will be subject to any defenses, counterclaims or off-sets which Lessee
has as of the date New Owner acquires title to the Real Property that are not
specifically set forth in the Lease.

 

  (d) will be liable to the Lessee in excess of the value of New Owner’s
interest in the Real Property.

 

  (e) will be bound by any modification of the Lease, including the release from
liability of any party liable for the obligations of Lessee, made without
Lender’s written consent.

 

  (f) will be bound by any rent paid more than one month in advance unless
actually received by New Owner, except as expressly required by the Lease, or
unless New Owner has consented to an advance payment in writing.

 

  (g) will be liable for the return of security or other lease deposits, unless
and then only to the extent of any security or funds actually received by New
Owner.

 

  (h) will be responsible for any consequential damages arising out of a
default, act or omission of Lessor under the Lease.

5. Nondisturbance. The New Owner will recognize Lessee as the “Tenant” under the
Lease and assume all of the obligations of Lessor under the Lease (except as
otherwise provided above in Paragraph 4), and not disturb Lessee’s quiet
enjoyment and possession of its Lease premises as long as Lessee is not in
default (beyond any applicable notice and cure periods) provided in the Lease.
Lender will not join Lessee as a party defendant in any action or proceeding
foreclosing the Mortgage, unless joining Lessee is necessary or appropriate to
foreclose the Mortgage, and then only for such purposes and not for the purposes
of terminating the Lease.

6. Lessee Obligations as to Payment of Rental under the Lease. This Agreement
will not vary any terms of the Lease that condition Lessee’s obligation to pay
rent on Lessor’s

 

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performance of its covenants under the Lease in respect of the habitability and
quiet enjoyment of the Real Property, which Lender agrees shall apply to the New
Owner as they have to the Lessor.

7. Attornment. Subject to the other terms of this Agreement, Lessee will, upon
notice of the transfer of title to the Real Property to New Owner, attorn to the
New Owner and recognize the New Owner as the Lessor under the Lease from and
after the date New Owner acquires title to the Real Property. The lien of the
Mortgage does not and will not encumber any trade fixtures, equipment or
personal property of Lessee used in its business on the Real Property.

8. Notices. Any notice under this Agreement may be delivered by hand or sent by
commercial delivery service or United States Postal Service express mail, in
either case for overnight delivery with proof of receipt, or sent by certified
mail, return receipt requested, to the following addresses:

 

To Lessee:    Prior to the Commencement Date of the Lease:       Marrone Bio
Innovations, Inc.       2121 Second Street, Suite B-107       Davis, CA 95618   
   Attn: Chief Financial Officer       After the Commencement Date of the Lease:
      Marrone Bio Innovations, Inc.       At the Premises       Attn: Chief
Financial Officer    To Lender:   

 

      Director, Mortgage Loan Servicing       AEGON USA Realty Advisors, Inc.   
   4333 Edgewood Road NE       Cedar Rapids, Iowa 52499   

Notice shall be deemed to have been given upon receipt if delivered by hand, on
the next business day if sent for overnight delivery by commercial delivery
service or United States Postal service express mail, or three (3) business days
following mailing if sent by certified mail, return receipt requested.

9. No Modification. No modification of this Agreement shall be valid unless in
writing and executed by the party against whom enforcement is sought.

10. Applicable Law. This Agreement shall be construed according to and governed
by the laws of the state in which the Real Property is located.

11. Successors and Assigns. This Agreement shall be binding on, and shall inure
to the benefit of, the parties’ successors and assigns.

 

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12. Counterparts. This Agreement may be executed and delivered in counterparts
for the convenience of the parties.

 

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IN WITNESS WHEREOF, the parties have signed this Subordination, Nondisturbance
and Attornment Agreement as of the year and date first above written.

 

Lessee:     Lender: By:  

 

    By:  

 

Name:  

 

    Name:  

 

Title:  

 

    Title:  

 

 

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ACKNOWLEDGMENT

 

STATE OF                         )    )SS:       COUNTY OF                     
   )   

On this      day of             ,         , before me, a                      in
and for said county, personally appeared                     , to me personally
known, who being by me duly sworn did say that that person is the
                     of said corporation and that said instrument was signed on
behalf of the said corporation by authority of its board of directors and the
said                      acknowledged the execution of said instrument to be
the voluntary act and deed of said corporation by it voluntarily executed.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my seal the day and
year first above written.

 

 

 

  Notary Public in and for said State

 

STATE OF                         )    )SS:       COUNTY OF                     
   )   

On this      day of             ,         , before me, a                      in
and for said county, personally appeared                     , to me personally
known, who being by me duly sworn did say that that person is the
                     of said corporation and that said instrument was signed on
behalf of the said corporation by authority of its board of directors and the
said                      acknowledged the execution of said instrument to be
the voluntary act and deed of said corporation by it voluntarily executed.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my seal the day and
year first above written.

 

 

 

  Notary Public in and for said State

 

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EXHIBIT F

GREENHOUSE

 

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EXHIBIT G

ROFO SPACE

 

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