Exhibit 10.1

SUBLEASE

THIS SUBLEASE (this “Sublease”) is dated for reference purposes as of March 24,
2009, and is made by and between TRANSCEPT PHARMACEUTICALS, INC., a Delaware
corporation (“Sublessor”), and BIPAR SCIENCES, INC., a Delaware corporation
(“Sublessee”). Sublessor and Sublessee hereby agree as follows:

1. Recitals: This Sublease is made with reference to the fact that Kashiwa
Fudosan America, Inc., a California corporation, as landlord (“Master Lessor”),
and Sublessor (f/k/a Novacea, Inc.), as tenant, entered into that certain Office
Lease dated as of May 15, 2007 (the “Master Lease”), with respect to premises
consisting of approximately 25,288 square feet of space, located at 400 Oyster
Point Boulevard, Suite 200, South San Francisco, CA (the “Premises”). A copy of
the Master Lease is attached hereto as Exhibit A.

2. Premises: Sublessor hereby subleases to Sublessee, and Sublessee hereby
subleases from Sublessor, a portion of the Premises consisting of approximately
18,368 square feet, as described in Exhibit B attached hereto (the “Subleased
Premises”). Sublessor and Sublessee agree that the square footage of the
Subleased Premises is 18,368 and shall not be subject to remeasurement during
the Term (as defined below).

3. Term:

A. Term. The term (the “Term”) of this Sublease shall be for the period
commencing on the later of Sublessor’s completion of Sublessor’s Work (defined
below) and June 1, 2009 (the “Commencement Date”) and ending at noon on
October 31, 2012 (the “Expiration Date”), unless this Sublease is sooner
terminated pursuant to its terms or the Master Lease is sooner terminated
pursuant to its terms.

B. Early Possession. Sublessee may have early access to the Subleased Premises
prior to the Commencement Date solely for the purpose of preparing the Subleased
Premises for occupancy (and not for the conduct of business therein), provided
that such occupancy (i) shall be subject to all of the provisions of this
Sublease, except for the obligation to pay Base Rent (as defined below);
(ii) shall not advance the Expiration Date of this Sublease; (iii) shall not
occur until Master Lessor’s written consent hereto is provided; (iv) shall not
interfere with Sublessor’s Work (defined below); and (v) shall not occur until
Sublessee has delivered to Sublessor evidence that it is carrying all insurance
required under this Sublease and has paid to Sublessor the first month’s Base
Rent and Security Deposit as required hereunder.

C. No Option to Extend. The parties hereby acknowledge that the expiration date
of the Master Lease is October 31, 2012 and that Sublessee has no option to
extend the Term of this Sublease.

 

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4. Rent:

A. Base Rent. Sublessee shall pay to Sublessor as base rent for the Subleased
Premises for each month during the Term (“Base Rent”) the amount set forth in
the chart below.

 

Term

   Base Rent

June 1, 2009 – September 30, 2009

   $ 15,000.00

October 1, 2009 – December 31, 2009

   $ 21,000.00

January 1, 2010 – May 31, 2010

   $ 27,552.00

June 1, 2010 – May 31, 2011

   $ 28,470.40

June 1, 2011 – May 31, 2012

   $ 29,205.12

June 1, 2012 – October 31, 2012

   $ 30,123.52

Base Rent and Additional Rent, as defined in Paragraph 4.B below, shall be paid
on or before the first (1st) day of each month; provided, however, that
Sublessee shall not be in default hereunder, nor shall Sublessee be liable for
any default interest or late charges pursuant to the Master Lease, as
incorporated herein, unless and until such Base Rent or Additional Rent is five
(5) days past due. Base Rent and Additional Rent for any period during the Term
hereof which is for less than one (1) month of the Term shall be a pro rata
portion of the monthly installment based on a thirty (30) day month. If an
increase in Base Rent becomes effective on a date other than the first day of a
calendar month, the Base Rent for that month shall be the sum of the two
applicable rates, each prorated for the portion of the month during which the
rate is in effect. Base Rent and Additional Rent shall be payable without notice
or demand and without any deduction, offset, or abatement, in lawful money of
the United States of America. Base Rent and Additional Rent shall be paid
directly to Sublessor at 1003 W. Cutting Blvd., Suite #110, Pt. Richmond, CA
94804, Attn: Accounts Receivable, or such other address as may be designated in
writing by Sublessor.

B. Additional Rent. All monies other than Base Rent required to be paid by
Sublessor under the Master Lease as to the Subleased Premises shall be paid by
Sublessee hereunder as and when such amounts are due under the Master Lease, as
incorporated herein. All such amounts shall be deemed additional rent
(“Additional Rent”); provided, however that Sublessee shall only be liable for
any amounts payable by Sublessor to Master Lessor as “Operating Expenses”, “Real
Estate Taxes” and “Utilities” (as defined in Section 4.2 of the Master Lease) to
the extent the same are in excess of any amounts payable by Sublessor as to the
Subleased Premises in calendar year 2009 (the “Base Year”). Sublessee and
Sublessor agree that the Subleased Premises account for 72.64% of the obligation
for total Operating Expenses, Real Estate Taxes and Utilities chargeable to
Sublessor pursuant to the Master Lease, for purposes of calculating those costs
chargeable to the Subleased Premises in the Base Year. Base Rent and Additional
Rent hereinafter collectively shall be referred to as “Rent”. Sublessee and
Sublessor agree, as a material part of the consideration given by Sublessee to
Sublessor for this Sublease, subject to the Base Year above, that Sublessee
shall pay all costs, expenses, taxes, insurance, maintenance and other charges
of every kind and nature arising in connection with this Sublease, the Master
Lease as to the Subleased Premises, or the Subleased Premises, such that
Sublessor shall receive, as a net consideration for this Sublease, the Base Rent
payable under Paragraph 4.A. hereof. Notwithstanding the foregoing, in the event
any cost or expense is incurred under the Master Lease for Sublessee’s sole
benefit (including the disproportionate use of utilities or dedicated HVAC
units) or as a result of Sublessee’s request for certain services (such as after
hours HVAC charges), Sublessee shall pay the entire cost thereof.

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C. Payment of First Month’s Rent. Upon receipt of Master Lessor’s consent to
this Sublease, Sublessee shall pay to Sublessor the sum of Fifteen Thousand
Dollars ($15,000), which shall constitute Base Rent for the first month of the
Term.

5. Security Deposit: Upon execution hereof by Sublessee, Sublessee shall deposit
with Sublessor the sum of One Hundred Thousand Dollars ($100,000) (the “Security
Deposit”), in the form of an irrevocable standby letter of credit. The Security
Deposit shall be governed by the terms and conditions of Section 5.1 of the
Master Lease, as incorporated herein.

6. Holdover: The parties hereby acknowledge that the expiration date of the
Master Lease is October 31, 2012 and that it is therefore critical that
Sublessee surrender the Subleased Premises to Sublessor no later than the
Expiration Date in accordance with the terms of this Sublease. In the event that
Sublessee does not surrender the Subleased Premises by the Expiration Date in
accordance with this Sublease, Sublessee shall pay holdover rent as to the
Subleased Premises as provided in Section 26 of the Master Lease and shall
indemnify, defend, protect and hold harmless Sublessor from and against all loss
and liability resulting from Sublessee’s delay in surrendering the Subleased
Premises.

7. Repairs: Sublessor shall deliver the Subleased Premises to Sublessee in
“broom clean” condition. The parties acknowledge and agree that Sublessee is
subleasing the Subleased Premises on an “as is” basis, and that, except as
expressly set forth in this Sublease, Sublessor has made no representations or
warranties with respect to the condition of the Subleased Premises as of the
Commencement Date. Except as set forth in Paragraph 11, Sublessor shall have no
obligation whatsoever to make or pay the cost of any alterations, improvements
or repairs to the Subleased Premises, including, without limitation, any
improvement or repair required to comply with any law, regulation, building code
or ordinance. Notwithstanding the foregoing, in the event any improvement or
repair required to comply with any law, regulation, building code or ordinance
shall be required to the Subleased Premises due to any particular use of or
alterations, additions or improvements to the Premises (excluding the Subleased
Premises), Sublessor shall be solely responsible for completing such improvement
or repair at its cost. Master Lessor shall be solely responsible for performance
of any repairs required to be performed by Master Lessor under the terms of the
Master Lease; provided, however, Sublessor agrees to use commercially reasonable
efforts to obtain Master Lessor’s performance (without requiring Sublessor to
spend more than a nominal sum).

8. Assignment and Subletting. Sublessee may not assign this Sublease, sublet the
Subleased Premises, transfer any interest of Sublessee therein or permit any use
of the Subleased Premises by another party (collectively, “Transfer”), without
the prior written consent of Sublessor and Master Lessor, except in the event
such consent is not required pursuant to Section 17 of the Master Lease.
Sublessee acknowledges that the Master Lease contains a “recapture” right in
Section 17.3, and that Sublessor may withhold consent to a proposed Transfer in
its sole discretion unless Master Lessor confirms in writing that the recapture
right does not apply to the Subleased Premises or otherwise waives such right.
Any Transfer without such consent shall be void and, at the option of Sublessor,
shall terminate this Sublease. Sublessor’s waiver or consent to any assignment
or subletting shall be ineffective unless set forth in writing. Any Transfer
shall be subject to the terms of Section 17 of the Master Lease, as incorporated
herein. Notwithstanding anything to the contrary contained herein or in the
Master Lease, Sublessor’s consent to a Transfer consented to by Master

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Lessor shall in all instances where required not be unreasonably withheld,
conditioned or delayed. Specifically, Section 17.4 of the Master Lease shall not
apply as to Sublessor; provided, however, Section 17.4 of the Master Lease shall
still apply as to Master Lessor, and Sublessee shall pay any of Master Lessor’s
costs, as provided in Section 17.4(i).

9. Use: Sublessee may use the Subleased Premises only for the uses identified in
Section 2.1 of the Master Lease. Sublessee shall comply with all reasonable
rules and regulations promulgated from time to time by Sublessor and Master
Lessor.

10. Effect of Conveyance: As used in this Sublease, the term “Sublessor” means
the holder of the tenant’s interest under the Master Lease. In the event of any
assignment, transfer or termination of the tenant’s interest under the Master
Lease, which assignment, transfer or termination may occur at any time during
the Term hereof in Sublessor’s sole discretion, Sublessor shall be and hereby is
entirely relieved of all covenants and obligations of Sublessor hereunder,
provided that any transferee has assumed in writing and shall carry out all
covenants and obligations thereafter to be performed by Sublessor hereunder.
Sublessor may transfer and deliver any security of Sublessee to the transferee
of the tenant’s interest under the Master Lease, and thereupon Sublessor shall
be discharged from any further liability with respect thereto.

11. Delivery and Acceptance: If Sublessor fails to deliver possession of the
Subleased Premises to Sublessee on or before June 1, 2009 (“Delivery Date”)
hereof for any reason whatsoever, then this Sublease shall not be void or
voidable unless Sublessor fails to deliver the Subleased Premises within fifteen
(15) days following the Delivery Date, in which event Sublessee shall have the
right to terminate this Sublease by providing written notice thereof to
Sublessor, effective as of the date of such written notice. In addition to the
foregoing termination right, for each day after the Delivery Date that Sublessor
has not delivered possession of the Subleased Premises to Sublessee, the date
Sublessee is otherwise obliged to commence payment of Base Rent shall be delayed
by one (1) additional day for each day that the Commencement Date is delayed
beyond such date. By taking possession of the Subleased Premises, Sublessee
conclusively shall be deemed to have accepted the Subleased Premises in their
as-is, then-existing condition, without any warranty whatsoever of Sublessor
with respect thereto. Notwithstanding the foregoing, to the Sublessor’s actual
knowledge, without inquiry, (i) all Work (as defined in Exhibit F to the Master
Lease) was originally performed in compliance with applicable laws in effect at
the time of such performance, and (ii) all of the Subleased Premises’ fire
protection, HVAC, electrical and mechanical systems serving the Subleased
Premises are operational and in good condition and repair as of the date hereof.
Sublessor shall, at Sublessor’s sole cost, prior to the Commencement Date,
construct a demising wall separating the Subleased Premises from the remainder
of the Premises (the “Sublessor’s Work”). Sublessor shall perform Sublessor’s
Work in conformance with all currently applicable building codes, permits, laws
and regulations.

12. Improvements: No alteration or improvements shall be made to the Subleased
Premises, except in accordance with the Master Lease, as incorporated herein,
and with the prior written consent of both Master Lessor and Sublessor to the
extent required in Section 9 of the Master Lease, as incorporated herein.

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13. Insurance and Subrogation: Sublessee shall obtain and keep in full force and
effect, at Sublessee’s sole cost and expense, during the Term the insurance
required under Section 14 of the Master Lease, as incorporated herein. Sublessee
shall name Master Lessor and Sublessor as additional insureds under its
liability insurance policy. Sublessor and Sublessee hereby release each other
from any damage to property or loss of any kind which is caused by or results
from any risk insured against under any property insurance policy required to be
carried by either party under this Sublease. Each party shall use commercially
reasonable efforts to cause each insurance policy obtained by it to provide that
the insurer waives all right of recovery against the other party and its agents
and employees in connection with any damage or injury covered by the policy, and
each party shall notify the other party if it is unable to obtain a waiver of
subrogation.

14. Default: Sublessee shall be in material default of its obligations under
this Sublease if Sublessee commits any act or omission which constitutes an
Event of Default under the Master Lease, as incorporated herein, or otherwise
fails to cure any obligation of Sublessee set forth herein after delivery of
written notice and passage of the applicable grace period, if any, provided by
the provisions of this Sublease.

15. Remedies: In the event of any default by Sublessee, Sublessor shall have all
remedies provided pursuant to Section 20 of the Master Lease, as incorporated
herein, and by applicable law.

16. Surrender: Sublessee shall remove all its trade fixtures prior to expiration
of this Sublease and shall, upon expiration of this Sublease, surrender the
Subleased Premises in the condition required under the Master Lease; provided,
however, that Sublessee shall not be responsible for (i) restoration of the
Subleased Premises to a condition better than the current condition as of the
Commencement Date of this Sublease, (ii) the restoration of any fixtures removed
by Sublessor pursuant to Section 9.6 of the Master Lease or (iii) removal of any
wiring and cabling pursuant to Section 11.1(c) of the Master Lease, except to
the extent Sublessee accepts ownership of the same pursuant to Paragraph 25 of
this Sublease.

17. Broker: Sublessor and Sublessee each represent to the other that they have
dealt with no real estate brokers, finders, agents or salesmen other than
Cushman & Wakefield, representing Sublessor, and Jones Lang LaSalle Americas,
Inc., representing Sublessee, in connection with this transaction. Each party
agrees to hold the other party harmless from and against all claims for
brokerage commissions, finder’s fees or other compensation made by any other
agent, broker, salesman or finder as a consequence of such party’s actions or
dealings with such agent, broker, salesman, or finder.

18. Notices: Unless at least five (5) days’ prior written notice is given in the
manner set forth in this paragraph, the address of each party for all purposes
connected with this Sublease shall be that address set forth below their
signatures at the end of this Sublease. All notices, demands or communications
in connection with this Sublease shall be (a) personally delivered; or
(b) properly addressed and (i) submitted to an overnight courier service,
charges prepaid, or (ii) deposited in the mail (certified, return receipt
requested, and postage prepaid). Notices shall be deemed delivered upon receipt,
if personally delivered, one (1) business day after being submitted to an
overnight courier service and three (3) business days after mailing, if mailed
as set forth above. All notices given to Master Lessor under the Master Lease
shall be considered received only when delivered in accordance with the Master
Lease.

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19. Other Sublease Terms:

A. Incorporation By Reference. Except as set forth below, the terms and
conditions of this Sublease shall include all of the terms of the Master Lease
and such terms are incorporated into this Sublease as if fully set forth herein,
except that: (i) each reference in such incorporated sections to “Lease” shall
be deemed a reference to “Sublease”; (ii) each reference to the “Premises” shall
be deemed a reference to the “Subleased Premises”; (iii) each reference to
“Landlord” and “Tenant” shall be deemed a reference to “Sublessor” and
“Sublessee”, respectively, except as otherwise expressly set forth herein;
(iv) with respect to work, services, repairs, restoration, insurance,
indemnities, representations, warranties or the performance of any other
obligation of Master Lessor under the Master Lease, the sole obligation of
Sublessor shall be to request the same in writing from Master Lessor as and when
requested to do so by Sublessee, and to use commercially reasonable efforts
(without requiring Sublessor to spend more than a nominal sum) to obtain Master
Lessor’s performance; (v) with respect to any obligation of Sublessee to be
performed under this Sublease, wherever the Master Lease grants to Sublessor a
specified number of days to perform its obligations under the Master Lease,
except as otherwise provided herein, Sublessee shall have three (3) fewer days
to perform the obligation, including, without limitation, curing any defaults;
(vi) with respect to any approval required to be obtained from the “Landlord”
under the Master Lease, such consent must be obtained from both Master Lessor
and Sublessor, provided such consent may not be unreasonably withheld by
Sublessor, and the approval of Sublessor may be withheld if Master Lessor’s
consent is not obtained; (vii) in any case where the “Landlord” reserves or is
granted the right to manage, supervise, control, repair, alter, regulate the use
of, enter or use the Subleased Premises or any areas beneath, above or adjacent
thereto, such reservation or grant of right of entry shall be deemed to be for
the benefit of both Master Lessor and Sublessor; (viii) notwithstanding anything
to the contrary in this paragraph below, in any case where “Tenant” is to
indemnify, release or waive claims against “Landlord”, such indemnity, release
or waiver shall be deemed to run from Sublessee to both Master Lessor and
Sublessor; provided, however, in no event shall any such indemnity apply to
Sublessor in the event of Sublessor’s gross negligence or willful misconduct;
(ix) in any case where “Tenant” is to execute and deliver certain documents or
notices to “Landlord”, such obligation shall be deemed to run from Sublessee to
both Master Lessor and Sublessor; (x) notwithstanding anything to the contrary
in this paragraph below, all payments shall be made to Sublessor; and
(xi) Sublessee shall not have the right to terminate this Sublease due to
casualty or condemnation unless Sublessor has such right under the Master Lease.

Notwithstanding the foregoing, (a) the following provisions of the Master Lease
shall not be incorporated herein: Sections 1.1 (except defined terms), 1.2-1.5
(except 1.5.2), 3.2, 5.1 (first sentence only), 6.2 (second sentence only),
14.3, 14.4.2, 14.4.4-.6, 21.2 (first sentence only), 23.1, 23.3, 24, 28.28 and
Exhibits B, E and F; (b) references in the following provisions to “Landlord”
shall mean Master Lessor only: Sections 1.6 (except the second to last sentence
of 1.6.4), 3.3 (the second to last sentence), 4.1(a)-(c), 4.2, 4.8, 4.9, 8.1,
8.2 (first paragraph only), 8.5, 8.6 (first paragraph only), 8.6.1, 9.4, 9.5
(excluding first sentence), 12.1 (first reference only), 12.2, 13.1, 14.1,
15.1-15.3, 15.4 (after the first sentence), 16.1, 18.1, 18.2, 22.2, 25.1, 25.2
(a), (c) and (d), 27.1, 28.18 (third sentence only), and Exhibit C;
(c) references in the following provisions to “Landlord” shall mean Master
Lessor and Sublessor: Sections 1.6.4 (the second to last sentence), 2.2 (the
second to last sentence), 4.10, 6.1.1, 7.2-7.4, 8.6.4, 8.7, 8.8, 9.2, 9.3, 9.5
(first sentence only), 9.6- 9.9, 11.2, 12.1 (except first reference), 12.3,
13.2, 14.2, 14.5, 15.4 (first sentence only), 19.1, 19.2 (the first

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reference only), 20.5, 22.1, 25.2(b), 25.3, and 27.2; (d) references to
“Tenant’s Pro Rata Share of the Building” and “Tenant’s Pro Rata Share of the
Complex” shall be to 7.93% and 3.95%, respectively; (e) the references to
“calendar year 2008” and “Base Year” in Section 4.2 shall be the calendar year
2009; (f) all references to the “Work Letter Agreement” shall be deleted;
(g) Sublessee may exercise the audit right under Section 4.9 only with Master
Lessor’s consent; provided, however, if Master Lessor does not consent, then
Sublessor shall exercise such rights upon request of Sublessee and at
Sublessee’s sole cost; and (h) the reference in Section 27 to “89” shall be to
“65” .

B. Assumption of Obligations. This Sublease is and at all times shall be subject
and subordinate to the Master Lease and the rights of Master Lessor thereunder.
Sublessee hereby expressly assumes and agrees: (i) to comply with all provisions
of the Master Lease as to the Subleased Premises which are incorporated
hereunder; and (ii) to perform all the obligations on the part of the “Tenant”
to be performed as to the Subleased Premises under the terms of the Master Lease
during the Term of this Sublease which are incorporated hereunder. In the event
the Master Lease is terminated for any reason whatsoever, this Sublease shall
terminate simultaneously with such termination, which termination shall be
without any liability of Sublessor to Sublessee, unless the Master Lease is
terminated due to an Event of Default by Sublessor that is not due to a default
by Sublessee under this Sublease. In the event of a conflict between the
provisions of this Sublease and the Master Lease, as between Sublessor and
Sublessee, the provisions of this Sublease shall control. In the event of a
conflict between the express provisions of this Sublease and the provisions of
the Master Lease, as incorporated herein, the express provisions of this
Sublease shall prevail.

20. Conditions Precedent: This Sublease and Sublessor’s and Sublessee’s
obligations hereunder are conditioned upon the written consent of Master Lessor.
If Sublessor fails to obtain Master Lessor’s consent within thirty (30) days
after execution of this Sublease by Sublessor, then Sublessee may terminate this
Sublease by giving the other party written notice thereof, and Sublessor shall
return to Sublessee its payment of the Security Deposit.

21. Authority to Execute: Sublessee and Sublessor each represent and warrant to
the other that each person executing this Sublease on behalf of each party is
duly authorized to execute and deliver this Sublease on behalf of that party.

22. Termination; Recapture: Notwithstanding anything to the contrary herein,
Sublessee acknowledges that, under the Master Lease, both Master Lessor and
Sublessor have certain termination and recapture rights under the Master Lease.
Nothing herein shall prohibit Master Lessor or Sublessor from exercising any
such rights and neither Master Lessor nor Sublessor shall have any liability to
Sublessee as a result thereof. In the event Master Lessor or Sublessor exercise
any such termination or recapture rights, this Sublease shall terminate without
any liability to Master Lessor or Sublessor; provided, however, that in the
event Master Lessor exercises a termination right due to an Event of Default by
Sublessor, or due to Sublessor’s failure to comply with its obligations pursuant
to this Sublease (which is not due to Sublessee’s failure to comply with its
obligations under this Sublease), Sublessor shall be liable to Sublessee.
Notwithstanding the foregoing, Sublessor shall not voluntarily terminate the
Master Lease during the Term hereof, except in connection with a casualty or
condemnation, unless and until Master Lessor agrees to recognize Sublessee’s
tenancy under the economic terms and conditions of this Sublease.

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23. Parking: Sublessee shall have the right to use a maximum of sixty-five
(65) parking spaces, subject to the terms of Section 27 of the Master Lease, as
incorporated herein.

24. Signage: Sublessor shall use commercially reasonable efforts to obtain
Master Lessor’s consent to the transfer of Sublessor’s signage rights under the
Master Lease to Sublessee. Sublessee shall pay any and all costs with respect to
such transfer and with respect to construction, installation and removal of such
signage. Notwithstanding anything to the contrary in this Sublease, Sublessee
shall not have any rights to such signage without Master Lessor’s consent.

25. Furniture, Fixtures and Equipment: Sublessee shall have the right to use
during the Term the existing furniture, fixtures and equipment, including
cabling and IT infrastructure within the Subleased Premises which are identified
on Exhibit C attached hereto (the “Furniture”) at no additional cost to
Sublessee. The Furniture is provided in its “AS IS, WHERE IS” condition, without
representation or warranty whatsoever. Sublessee shall insure the Furniture
under the property insurance policy required under the Master Lease, as
incorporated herein. Sublessee shall maintain the Furniture in good condition
and repair, reasonable wear and tear excepted, and shall be responsible for any
loss or damage to the same occurring during the Term. Sublessee shall surrender
the Furniture to Sublessor upon the termination of this Sublease in the same
condition as exists as of the Commencement Date, reasonable wear and tear
excepted. Sublessee shall not remove any of the Furniture from the Subleased
Premises. Notwithstanding the foregoing, provided (i) Sublessee is not then in
default under this Sublease and no event has occurred that with the passing of
time or the giving of notice, would constitute a default by Sublessee under this
Sublease and (ii) this Sublease has not terminated prior to the Expiration Date,
which conditions may be waived by Sublessor in its sole discretion, then upon
the termination of this Sublease, Sublessor shall, subject to Sublessee’s
consent (which consent shall be deemed given unless Sublessee notifies Sublessor
in writing not less than thirty (30) days prior to the Expiration Date that it
is withholding such consent), sell the Furniture to Sublessee for the sum of One
Dollar $1.00 pursuant to a commercially reasonable form of bill of sale, and
Sublessee shall accept the same in its “AS IS, WHERE IS” condition, without
representation or warranty whatsoever. If Sublessee timely notifies Sublessor in
writing that it does not consent to the purchase of the Furniture, Sublessor
shall have the right at any time during the last week of the Term to remove the
Furniture from the Subleased Premises.

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

 

SUBLESSEE:     SUBLESSOR: BIPAR SCIENCES, INC.,     TRANSCEPT PHARMACEUTICALS,
INC., a Delaware corporation     a Delaware corporation By:  

/s/ Hoyoung Huh

    By:  

/s/ Thomas Soloway

Name:  

Hoyoung Huh

    Name:  

Thomas Soloway

Its:  

President and CEO

    Its:  

CFO

Notice Address:     Notice Address: 1000 Marina Blvd.     1003 W. Cutting Blvd.
Suite 550     Suite #110 Brisbane, CA 94005     Pt. Richmond, CA 94804 Attn:
________________________     Attn: Vice President, Operations

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EXHIBIT A

MASTER LEASE

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OYSTER POINT MARINA PLAZA

Office Lease

of

SUITE 200

to

NOVACEA, INC.,

a Delaware corporation

400 Oyster Point Boulevard

South San Francisco, CA 94080

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OYSTER POINT MARINA PLAZA

Office Lease

THIS OFFICE LEASE (the “Lease”) is entered into as of May 15, 2007, by and
between KASHIWA FUDOSAN AMERICA, INC., a California corporation (“Landlord”) and
NOVACEA, INC., a Delaware corporation (“Tenant”).

1    BASIC LEASE TERMS

1.1 LEASE OF PREMISES. Landlord leases to Tenant, and Tenant rents and hires
from Landlord, the premises described in § 1.3 below, in the building known by
the street address 400 Oyster Point Boulevard (the “Building”) in the City of
South San Francisco, County of San Mateo, State of California, on the property
described in § 1.6 below, in the business park commonly known as Oyster Point
Marina Plaza (the “Complex”), for the term stated in § 1.4 below, for the rents
hereinafter reserved, and upon and subject to the terms, conditions (including
limitations, restrictions, and reservations), and covenants hereinafter
provided. The Building and the Complex are more particularly described and
depicted in Exhibit A which is attached hereto. Each party hereby expressly
covenants and agrees to observe and perform all of the conditions and covenants
herein contained on its part to be observed and performed.

1.2 SUMMARY TABLE. The parties agree that the following table (the “Table”) sets
forth in summary form the basic terms of this Lease, including the specific
space comprising the Premises and, with respect to such space, the Term of the
Lease, the usable and rentable square footage, the Base Rent, Base Year, and
Tenant’s Share, as all of such terms are defined below:

 

PERIOD

   SUITE
NO.    RSF    USF    MONTHLY
BASE RENT    T’S SHARE
BLDG     T’S SHARE
COMPLEX     BASE
YEAR

Commencement Date through September 30, 2008

   200    25,288    21,990    $ 56,898.00    10.911 %   5.444 %   2008

October 1, 2008 through September 30, 2009

   200    25,288    21,990    $ 58,604.94    10.911 %   5.444 %   2008

October 1, 2009 through September 30, 2010

   200    25,288    21,990    $ 60,363.09    10.911 %   5.444 %   2008

October 1, 2010 through September 30, 2011

   200    25,288    21,990    $ 62,173.98    10.911 %   5.444 %   2008

October 1, 2011 through September 30, 2012

   200    25,288    21,990    $ 64,039.20    10.911 %   5.444 %   2008

In the event of any conflict between the terms contained in the Table and the
terms contained in subsequent sections of the Lease, the terms of the Table
shall control, except that any dates stated in the Table are subject to
adjustment as appropriate to the extent any other provisions of the Lease
provide for adjustments to the Commencement Date and/or the Expiration Date.

1.3 PREMISES. The premises leased to Tenant (the “Premises”) are a portion of
the second (2nd) floor of the Building and are commonly known as Suite 200, as
shown on the floor plan annexed hereto as Exhibit B. The Premises also include
all fixtures and equipment which are attached thereto, except items not deemed
to be included therein and which are removable by Tenant as provided in Article
10 below.

 

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Landlord and Tenant agree that the usable and rentable area of the Premises, and
the respective rentable areas of the Property (as defined in § 1.6 below) and
Complex, for all purposes under this Lease, are as follows and as specified in
the Table:

 

Property’s Rentable Area:   231,769 rsf    Complex’s Rentable Area:   464,502
rsf.   

Tenant acknowledges that it has caused its architect to verify the numbers
stated in the Table and herein relating to the measurements of such spaces prior
to the Commencement Date of this Lease or has had an opportunity to do so.

1.3.1 Rights of First Refusal. In consideration for Tenant’s execution and
delivery of this Lease, provided no material Event of Default remains
outstanding and uncured on the date Tenant exercises its rights under this §
1.3.1 et seq., Landlord hereby grants to Tenant the following rights of first
refusal with respect to the following spaces (collectively the “RFR Space”)
exercisable throughout the initial Term of the Lease:

 

  •  

Suite 210 (1,421 rsf), vacant as of the date of this Lease;

 

  •  

Suite 212 (1,541 rsf), currently occupied by Reprogenetics under a lease
expiring on September 30, 2007;

 

  •  

Suite 226 (1,451 rsf), currently occupied by Netswitch under a lease expiring on
January 31, 2009; and

 

  •  

Suite 228 (3,165 rsf), currently occupied by Halloo Communications under a lease
expiring on March 31, 2009;

Notwithstanding anything to the contrary herein, Tenant’s rights of first
refusal hereunder shall be subject to (i) any renewal or extension options under
the existing leases of the RFR Space existing as of the date of the parties’
execution and delivery to each other of this Lease.

(a) Notice of Bona Fide Offer. If at any time during the period specified in §
1.3.1 above Landlord receives a bona fide offer, agreement, or proposal (“Lease
Proposal”) which is acceptable to Landlord from any third party to lease any
portion of the RFR Space; or if Landlord makes a bona fide offer, agreement, or
proposal to a third party which the third party is willing to accept, Landlord
shall send Tenant a summary (the “RFR Summary”) of the economic terms and
conditions of the Lease Proposal, including a description of the subject space,
proposed term, and basic business terms and shall notify Tenant of Landlord’s
intention to conclude a lease on the terms of the Lease Proposal. Tenant shall
have the right for a period of five (5) full business days (concluding at 5:00
p.m.) following Tenant’s receipt of the RFR Summary in which to exercise its
right to lease the space described in the RFR Summary (the “RFR Space”) on the
terms and conditions set forth in this § 1.3.1 et seq. by giving Landlord
written notice of such exercise. If Tenant fails to notify Landlord of the
exercise of its rights hereunder within such five-business-day period, Landlord
may then lease the RFR Space to the third party tenant named as the tenant in
the RFR Summary or an affiliate of such third party tenant, provided that the
lease entered into pursuant to the Lease Proposal is (i) on the same terms and
conditions as set forth in the RFR Summary or (ii) on substantially the same
terms and conditions as set forth in the RFR Summary and Landlord is not
required to re offer such First Refusal Space to Tenant pursuant to § 1.3.1(d)
below.

(b) Commencement and Duration. If Tenant exercises its right of first refusal,
Landlord shall make the RFR Space available for purposes of construction of
improvements within ninety (90)

 

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days following Tenant’s exercise of this right of first refusal (the “RFR Space
Delivery Date”); the lease shall commence as provided herein and shall expire
after the length of the term specified in the Lease Proposal. The parties
understand and agree that the Term of the Lease with respect to any RFR Space
shall not expire coterminously with the initial Term of the Lease stated in the
Table for the remainder of the Premises. The parties agree that Landlord shall
improve the RFR Space within ninety (90) days of the RFR Space Delivery Date,
whether or not the RFR Space has been previously improved, in accordance with
the terms of the Work Letter Agreement, with appropriate changes being made only
to the Plans and Specifications, Construction Schedule, and the amount of the
Landlord’s contribution (i.e., the value of the TIs computed on a
per-square-foot basis), which amount shall be determined as provided below.
Tenant shall deliver to Landlord for approval (which shall not to be
unreasonably withheld, conditioned, or delayed) Tenant’s proposed plans and
specifications no later than ninety (90) days following Tenant’s exercise of
this right of first refusal. Landlord shall, construct within the RFR Space the
improvements specified in the final approved plans and specifications for such
construction. The commencement date of the lease of such RFR Space (upon which
Base Rent and Additional Rent shall begin to accrue, and Tenant’s Pro Rata Share
shall be adjusted to take into account the RFR Space) shall be the earlier of
(i) the date upon which Landlord’s construction of the improvements within the
RFR Space satisfies the Delivery Requirements (hereinafter defined) with respect
to the RFR Space or (ii) the date upon which Tenant occupies the RFR Space (or
any portion thereof) and commences conducting Tenant’s business operations
therein; provided, however, that in the event of any Tenant Delay (hereinafter
defined), Tenant’s obligation to pay Base Rent and Additional Rent with regard
to such RFR Space shall be advanced by one (1) day for each such day substantial
completion of such improvements was delayed by a Tenant Delay. Following
Landlord’s delivery of the RFR Space in compliance with all Delivery
Requirements, the RFR Space shall be deemed to be a part of the Premises and
shall be leased by Tenant upon and subject to all of the terms, covenants, and
conditions of this Lease.

(c) Terms and Conditions. If Tenant exercises its right of first refusal as to
the RFR Space, all terms and conditions for the lease of any such space shall be
the same as those then in effect under the Lease, except for the rental, tenant
inducements, rent abatements, and improvement allowances (“Third-Party
Economics”). Tenant shall have the right to a lease of the RFR Space upon such
Third-Party Economics as were contained in the Lease Proposal in the same
proportion as the number of months remaining in the Term (including the term of
any extension option then having been exercised) bears to the number of months
in the lease term contained in the RFR Summary.

(d) Continuing Right, Re-Offer, and Priority. If Tenant shall not timely
exercise the right of first refusal contained herein upon notification by
Landlord, Tenant shall again have the same rights as to such space each time
Landlord receives or makes a bona fide offer, from or to a third party, which
both Landlord and the third party are willing to accept, to lease such space,
whether or not Tenant has previously exercised or refused to exercise the rights
herein contained with respect to such space or other space. If Tenant rejects or
is deemed to have rejected a bona fide offer of which Tenant is notified, and if
(i) such third-party bona fide offer is not consummated within five (5) months;
(ii) the effective rental rate to be paid pursuant to the bona fide offer
changes in any respect so as to become more than ten percent (10%) more
favorable to the prospective tenant (iii) there is any change in the term,
expansion rights, extension rights, or renewal rights proposed in the Lease
Proposal; or (iv) there is any other material change in the nonmonetary terms of
the bona fide offer, then the RFR Space shall again become subject to the terms
of this § 1.3.1 et seq. and shall again be offered to Tenant as provided above.
As used in the previous sentence, the term effective rental rate means an amount
determined by taking the total base rental and deducting all abatements,
allowances, cost of non-monetary tenant inducements (e.g., health club
memberships, etc.), tenant

 

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improvement costs in excess of Building-standard, and any other monetary
inducements. The foregoing right of first refusal shall be subject to the
existing tenants’ or occupants’ of the First Refusal Space renewing their
existing leases pursuant to options to extend or renew which were in existence
in their written lease agreements as of the date of this Lease.

(e) Confirmatory Documentation. After Tenant validly exercises the right of
first refusal provided herein, the parties shall execute an amendment to the
Lease adding the First Refusal Space, or such other documentation as Landlord
shall require, promptly after Landlord shall prepare the same, in order to
confirm the leasing of such First Refusal Space to Tenant; but an otherwise
valid exercise of the rights of first refusal contained herein shall be fully
effective, whether or not such confirmatory documentation is executed.

(f) Failure to Exercise. If Tenant shall fail to exercise its right of first
refusal after notice by Landlord of the receipt of a bona fide third-party offer
to lease the RFR Space within the time specified herein, such right shall be
deemed to have lapsed and expired with respect to that particular RFR Summary,
and Landlord may, for a period of five (5) months, enter into a lease pursuant
to the terms of the RFR Summary with the prospective tenant named therein.

(g) Default and Termination. Tenant’s exercise of such right of first refusal
hereunder shall not operate to cure any default by Tenant of any of the terms or
provisions in the Lease, nor to extinguish or impair any rights or remedies of
Landlord arising by virtue of such default. The exercises of the right of first
refusal herein shall, at Landlord’s election, be null and void if a material
Event of Default exists which remains outstanding and uncured on the date Tenant
exercises its rights hereunder. Tenant agrees that time is of the essence of
rights of first refusal specified herein.

(h) Effect of Transfer. If Tenant subleases or assigns an aggregate total of
more than fifty percent (50%) of the Premises at any time during the Term of
this Lease, the rights of first refusal hereunder with respect to the Specific
RFR Spaces shall terminate with immediate effect.

1.4 TERM. The term (the “Term”) for which the Premises are hereby leased shall
commence on the “Commencement Date,” which shall be the earlier to occur of
(i) the day on which the Premises are ready for occupancy (as defined in Article
3) or (ii) the day on which Tenant or anyone claiming under or through Tenant
first occupies the Premises for business, and shall end at noon on the
“Expiration Date,” which shall be the last day of the calendar month in which
occurs the day preceding the fifth (5th) anniversary of the Commencement Date,
or any earlier date upon which the Term may expire or be cancelled or terminated
pursuant to any of the conditions or covenants of this Lease or pursuant to law.
Promptly following the Commencement Date the parties hereto shall, if required
by Landlord, enter into a supplementary agreement fixing the dates of the
Commencement Date and the Expiration Date in the form which is attached hereto
as Exhibit E and incorporated herein by reference.

1.4.1 Option to Extend. Tenant is hereby granted one (1) option to extend (the
“Extension Option”) the Term of the Lease for an additional period of five
(5) consecutive Lease Years (the “Extension Period”). The Extension Period term
shall begin the first day following the Expiration Date of the Lease and shall
take effect on the same terms and conditions in effect under the Lease
immediately prior to the Extension Period, except that (i) Tenant shall have no
further right to extend and (ii) monthly Base Rent shall be the rate which is
Fair Market Value (as defined below). The Fair Market Value shall be the
effective rent (face rate less free rent) being charged for comparable space in
comparable buildings leased on comparable terms, including annual escalations
and such other terms. Tenant’s Extension Option shall apply to the entire
Premises under the Lease at the time of Tenant’s exercise, including any RFR
Space and/or any RFO Space that may theretofore have been

 

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added to the Premises pursuant to exercise of rights under § 1.3.1 and/or §
1.3.2 above, and shall not be eligible for exercise with respect to a portion of
the Premises only.

(a) Exercise of Option. The Extension Option may be exercised only by
(i) delivering in person to Landlord’s Building Manager in the Building Office
written notice of Tenant’s irrevocable election to exercise no earlier than
January 1, 2012, and no later than April 1, 2012, and (ii) collecting and
retaining in exchange for such notice of exercise an original written receipt
therefor signed and dated by Landlord’s Building Manager. Tenant’s exercise of
its Extension Option shall not be effective or valid if there is any deviation
in the timing or manner of exercise prescribed herein.

(b) Failure to Exercise. If Tenant shall fail validly and timely to exercise the
option herein granted, the Extension Option shall terminate and shall be null
and void and of no further force and effect.

(c) Fair Market Value. Provided that Tenant has validly exercised its option
when and as required hereunder, Landlord shall, on or before May 1, 2012,
provide written notice to Tenant of its determination of the Fair Market Value.
Within fifteen (15) days after receiving such determination (and in no event
later than May 15, 2012) (“Tenant’s Review Period”), Tenant shall irrevocably
elect, in writing, to do one of the following: (i) accept Landlord’s
determination; or (ii) object to Landlord’s determination and with such
objection set forth in writing Tenant’s determination of the Fair Market Value.
If Tenant so objects, Landlord and Tenant shall attempt in good faith to agree
upon such Fair Market Value using their best good-faith efforts. If Landlord and
Tenant fail to reach agreement within fifteen (15) days following Tenant’s
Review Period (the “Outside Agreement Date”), then Landlord shall submit each
party’s determination to arbitration in accordance with the then-current rules
and procedures of the American Arbitration Association. If Tenant objects to
Landlord’s determination of Fair Market Value, Tenant shall pay Rent at the Fair
Market Value determined by Landlord until the matter is resolved by binding
arbitration as provided below, subject to retroactive adjustment after the
matter is so resolved. If Tenant fails so to accept or object to Landlord’s
determination of Fair Market Value in writing within Tenant’s Review Period,
Tenant shall conclusively be deemed to have approved of the Fair Market Value as
determined by Landlord.

(d) Appointment of Arbitrators. Not later than fifteen (15) days following the
Outside Agreement Date, Landlord and Tenant shall each appoint one arbitrator
who shall by profession be a real estate broker who shall have been active over
the ten-year period ending on the date of such appointment in the leasing of
commercial properties within northern San Mateo County. The determination of the
arbitrators shall be limited solely to the issue of whether Landlord’s or
Tenant’s submitted Fair Market Value for the Premises is the more accurate as
determined by the arbitrators, taking into account the requirements of this §
1.4.1 et seq.

(e) Appointment of Third Arbitrator. The two (2) arbitrators so appointed shall
within fifteen (15) days of the date of the appointment of the last-appointed
arbitrator agree upon and appoint a third arbitrator, who shall be qualified
under the same criteria as set forth hereinabove for qualification of the
initial two arbitrators.

(f) Arbitrators’ Decision. The three (3) arbitrators shall, within thirty
(30) days of the appointment of the third arbitrator, reach a decision as to
whether the parties shall use Landlord’s or Tenant’s submitted Fair Market
Value, and shall notify Landlord and Tenant

 

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thereof. The decision of the majority of the three (3) arbitrators shall be
binding upon Landlord and Tenant. The arbitrators shall not be permitted to set
Fair Market Value to any level other than either Landlord’s or Tenant’s
submitted Fair Market Value.

(g) Failure to Appoint. If either Landlord or Tenant fails to appoint an
arbitrator within fifteen (15) days after the Outside Agreement Date, the
arbitrator timely appointed by one of the parties shall reach a decision, notify
Landlord and Tenant thereof, and such arbitrator’s decision shall be binding
upon Landlord and Tenant. If the two (2) arbitrators fail to agree upon and
appoint a third arbitrator, both arbitrators shall be dismissed and the matter
to be decided shall be forthwith submitted to arbitration under the Commercial
Arbitration Rules of the American Arbitration Association then in effect, but
subject to the instructions set forth in this § 1.4.1 et seq..

(h) Cost of Arbitration. The cost of arbitration shall be paid by Landlord and
Tenant equally.

(i) Default. Tenant’s exercise of the Extension Option shall, at Landlord’s
election, be null and void if Tenant is in Default on the date of exercise or at
any time thereafter and prior to commencement of the• Extension Period. Tenant’s
exercise of the Extension Option shall not operate to cure any Default by Tenant
nor to extinguish or impair any rights or remedies of Landlord arising by virtue
of such Default. If the Lease or Tenant’s right to possession of the Premises
shall terminate before Tenant shall have exercised the Extension Option, then
immediately upon such termination the Extension Option shall simultaneously
terminate and become null and void.

(j) Time. Time is of the essence of this Extension Option.

1.5 RENT. The “Rent” reserved under this Lease, for the Term thereof, shall
consist of the following:

 

  (a) “Base Rent” as set forth in the Table for the various spaces and periods
described therein per month, which shall be payable in advance on the first day
of each and every calendar month during the Term of this Lease, except that
Tenant shall pay the first month’s Base Rent due under the Lease upon the
execution and delivery of this Lease by Tenant; and

 

  (b) “Additional Rent” consisting of any and all other sums of money as shall
become payable by Tenant to Landlord hereunder; and Landlord shall have the same
remedies for default in the payment of Additional Rent as for a default in
payment of Base Rent).

1.5.1 Payment of Rent. Tenant shall pay the Base Rent and Additional Rent
promptly when due, without demand therefor and without any abatement, deduction,
or setoff whatsoever, except as may be expressly provided in this Lease. Tenant
shall pay the Rent to Landlord, in lawful money of the United States of America,
at Landlord’s office at the Complex or at such other place, or to such agent and
at such place, as Landlord may designate by notice to Tenant. If the
Commencement Date occurs on a day other than the first day of a calendar month,
the Base Rent for such calendar month shall be prorated based on a 30-day month,
and the balance of the first month’s Base Rent theretofore paid shall be
credited against the next monthly installment of Base Rent.

1.5.2 Interest and Late Charges. If Tenant fails to pay any Rent when due, the
unpaid amounts shall bear interest from the due date until paid at a rate per
annum equal to the Prime Rate plus five percent (5%) or, if less, at the highest
rate of interest permitted by applicable law. As used herein, “Prime Rate” means
the prime rate published in the Money Rates section of the Wall Street Journal

 

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(Western edition) as the same may change from time to time or in a similar
publication if the Wall Street Journal ceases publication or ceases publication
of its Money Rates section during the Term. Tenant acknowledges that the late
payment of any monthly Rent will cause Landlord to lose the use of that money
and incur costs and expenses not contemplated under this Lease, including
administrative and collection costs and processing and account expenses, the
exact amount of which it is difficult to ascertain. Therefore, in addition to
interest, if any such installment is not received by Landlord within five
(5) days from the date it is due, Tenant shall pay Landlord a late charge equal
to ten percent (10%) of such installment. Landlord and Tenant agree that this
late charge represents a reasonable estimate of such costs and expenses and is
fair compensation to Landlord for the loss suffered from such nonpayment by
Tenant. In addition, any check returned by the bank for any reason will be
considered late and will be subject to all late charges plus an additional
returned check fee of Twenty Dollars ($20.00). After two such occasions upon
which checks have been returned in any twelve-month period, Landlord will have
the right to require payment by a cashier’s check or money order. Acceptance of
any interest or late charge shall not constitute a waiver of Tenant’s default
with respect to such nonpayment by Tenant nor prevent Landlord from exercising
any other rights or remedies available to Landlord under this Lease or at law or
in equity, unless the payment of such interest and late charges is accompanied
by all rentals then due and owning (notwithstanding anything to the contrary in
§ 20.2.1 below).

1.6 PROPERTY. For the purposes of this Lease, the “Property” shall mean the
Building and any common or public areas or facilities, easements, corridors,
lobbies, sidewalks, loading areas, driveways, landscaped areas, skywalk, parking
garages and lots, and any and all other structures or facilities operated or
maintained in connection with or for the benefit of the Building, and all
parcels or tracts of land on which all or any portion of the Building or any of
the other foregoing items are located, and any fixtures, machinery, equipment,
apparatus, Systems and Equipment (as defined in § 1.6.5 below), furniture and
other personal property located thereon or therein and used in connection
therewith, whether title is held by Landlord or its affiliates. The Property
shall also be deemed to include such other of the Complex’s buildings or
structures (and related facilities and parcels on which the same are located) as
Landlord shall have incorporated by reference to the total square footage of the
Building stated in § 1.3 above.

1.6.1 Common Areas. Tenant and its agents, employees, and invitees shall have
the non-exclusive right with others designated by Landlord to the free use of
the common areas in the Property and the Complex for the common areas’ intended
and normal purpose. The term common areas shall mean elevators, sidewalks,
parking areas, driveways, hallways, stairways, public restrooms, common
entrances, lobbies, and other similar public areas and access ways.

1.6.2 Athletic Facility. Notwithstanding the foregoing, the common areas do not
include the Building’s athletic facility (the “Athletic Facility”), which is an
unsupervised and unattended weight and exercise room and shower facility. Tenant
acknowledges that Landlord presently makes available (but is not obligated under
this Lease to make available) the Athletic Facility for the general use of all
tenants and their officers and employees, subject to such rules and regulations
as Landlord may impose from time to time in its sole and absolute discretion
regarding the use thereof. Tenant shall cause each of its officers and employees
using the Athletic Facility to sign and deliver to Landlord an “Athletic
Facility Use Agreement” in the form attached hereto as Exhibit D, as such form
may be revised by Landlord from time to time in its sole and absolute
discretion. Tenant understands and agrees that no individual shall be permitted
use of or access to the Athletic Facility unless and until such individual shall
have first signed and delivered the Athletic Facility Use Agreement to Landlord.
Landlord shall have the right to limit the use of the Athletic Facility in any
manner it may deem necessary, or to discontinue the Athletic Facility
altogether, at any time, in its sole and absolute discretion, and neither Tenant
nor its officers or employees shall be entitled to any

 

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compensation, credit, allowance, or offset of expenses or Rent as a result of
any such limitation or discontinuance.

1.6.3 Reservation to Landlord. Notwithstanding anything to the contrary herein,
possession of areas necessary for utilities, services, safety, and operation of
the Property, including the Systems and Equipment, telephone closets (whether
located in the common areas or in the Premises), fire exits and stairways,
perimeter walls, space between the finished ceiling of the Premises and the slab
of the floor or roof of the Property thereabove, and the use thereof, together
with the right to install, maintain, operate, repair, and replace any part of
the Systems and Equipment in, through, under, or above the Premises in locations
that will not materially interfere with Tenant’s use of the Premises, are hereby
excepted from both the Premises and the common areas and are reserved by
Landlord and not demised to Tenant. Tenant’s access to the telephone closets on
each floor and the Building’s main telephone room shall be subject to the Rules
(as defined in § 13.1 below) and shall be permitted only with Landlord’s written
consent and under the supervision of Landlord’s Building Engineer on each
occasion that such access is sought.

1.6.4 Changes and Alterations of the Property. Landlord reserves the right to
make repairs, alterations, additions, or improvements, structural or otherwise,
in or to the Property or Complex as deemed necessary or desirable in Landlord’s
sole and absolute discretion, so long as such repairs or alterations do not
materially and unreasonably interfere with Tenant’s access to or beneficial use
of the Premises for their intended purposes. Landlord reserves the right
hereunder to do the following: (i) install, use, maintain, repair, and replace
pipes, ducts, conduits, wires, and appurtenant meters and equipment for service
to the various parts of the Property above the ceiling surfaces, below the floor
surfaces, within the walls, and in the central core areas; (ii) to relocate any
pipes, ducts, conduits, wires, and appurtenant meters and equipment which are
located in the Premises or located elsewhere outside the Premises; (iii) expand
the Building or the Complex; (iv) make changes to the Property or the Complex,
including changes, expansions, and reductions in the location, size, shape, and
number of driveways, entrances, loading and unloading areas, ingress, egress,
direction of traffic, landscaped areas, walkways, parking spaces, and parking
areas; (v) close any of the common areas, so long as reasonable access to the
Premises remains available; (vi) use the common areas while engaged in making
additional improvements, repairs, or alterations to the Property, Complex, or
any portion thereof; and (vii) do and perform such other acts and make such
other changes in, to, or with respect to the Property, Complex, common areas,
and Building as Landlord may deem appropriate. The exercise of any of the
foregoing rights shall not subject Landlord to claims for constructive eviction,
abatement of Rent, damages, or other claims of any kind, except as otherwise
expressly provided in this Lease. If Landlord enters the Premises to exercise
any of the foregoing rights, Landlord shall provide reasonable advance written
or oral notice to Tenant’s on-site manager.

1.6.5 Systems and Equipment. As used in this Lease, “Systems and Equipment”
means collectively any existing plant, machinery, transformers, duct work,
intrabuilding network cables and wires that transmit voice, data, and other
telecommunications signals (“INC”), and other equipment, facilities, and systems
designed to supply water, heat, ventilation, air conditioning and humidity or
any other services or utilities, or comprising or serving as any component or
portion of the electrical, gas, steam, plumbing, sprinkler, communications,
alarm, security, or fire/life/safety systems or equipment, or any other
mechanical, electrical, electronic, computer or other systems or equipment for
the Property.

2    USE

2.1 USE AND ENJOYMENT OF PREMISES. Tenant shall use and occupy the Premises for
executive and general offices and for no other purpose. Notwithstanding anything
contained herein to the contrary,

 

Oyster Point Marina Plaza Office Lease

Kashiwa Fudosan America, Inc. :: Novacea, Inc.

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Tenant may use portions of the Premises not to exceed one hundred fifty
(150) usable square feet for the preparation and reheating of food and
beverages, including the use of refrigerators, ice makers, coffee machines, hot
plates, microwave ovens, or similar heating devices (but not for the actual
cooking of food) for service only to Tenant’s employees and business invitees.

2.1.1 Suitability. Tenant acknowledges that neither Landlord nor any agent of
Landlord has made any representation or warranty with respect to the Premises,
the Property, or the Complex, or with respect to the suitability of same for the
conduct of Tenant’s business, except as expressly provided in this Lease.
Tenant’s acceptance of possession of the Premises shall conclusively establish
that the foregoing were at such time in satisfactory condition. Landlord makes
no representation to Tenant regarding the installation, ownership, location, or
suitability for Tenant’s purposes of the INC in the Building.

2.1.2 Insurance Rates. Tenant shall not do or suffer anything to be done in or
about the Premises, nor shall Tenant bring or allow anything to be brought into
the Premises, which will in any way increase the rate of any fire insurance or
other insurance upon the Property or its contents, cause a cancellation of said
insurance, or otherwise affect said insurance in any manner.

2.1.3 Use to Comply with Laws. Tenant shall use the Premises in conformity with
all applicable Laws, as specified in Article 6 below.

2.1.4 Floor Loading. Tenant shall not place or permit to be placed on any floor
a load exceeding eighty (80) pounds per square foot or such lower floor load as
such floor was designed to carry.

2.2 NUISANCE AND WASTE. Tenant also shall not do or suffer anything to be done
in or about the Premises which will in any way obstruct or interfere with the
rights of other tenants or occupants of the Property or injure or annoy said
tenants or occupants, nor shall Tenant use or suffer the Premises to be used for
any unlawful purposes. In no event shall Tenant cause or permit any nuisance in
or about the Premises, and no loudspeakers or similar devices shall be used
without the prior written approval of Landlord, which approval may be withheld
in Landlord’s sole and absolute discretion. Tenant shall not commit or suffer to
be committed any waste in or upon the Premises. The provisions of this section
are for the benefit of Landlord only and shall not be construed to be for the
benefit of any tenant or occupant of the Building. If any governmental license
or permit, other than a Certificate of Occupancy, shall be required for the
proper and lawful conduct of Tenant’s business in the Premises, or any part
thereof, and if failure to secure such license or permit would in any way affect
Landlord, Tenant, at its sole expense, shall procure and thereafter maintain
such license or permit and submit the same for inspection by Landlord. Tenant
shall at all times comply with the terms and conditions of each such license or
permit.

2.3 COMPLIANCE WITH CERTIFICATE OF OCCUPANCY. Tenant shall not at any time use
or occupy the Premises, or suffer or permit anyone to use or occupy, the
Premises, or do or permit anything to be done in the Premises, in violation of
the Certificate of Occupancy for the Premises or for the Building.

3    PREPARATION OF THE PREMISES

3.1 CONDITION OF PREMISES. Except as otherwise expressly provided in § 3.2 below
and the “Work Letter Agreement” which has been executed by Landlord and Tenant
concurrently with their execution of this Lease substantially in the form
attached hereto as Exhibit F, Tenant shall accept the Premises, any existing
Improvements in the Premises (as defined in § 10.1 below), and the Systems and
Equipment serving the same in an “as is” condition on the date the Term
commences, and Landlord shall have no obligation to improve, alter, remodel, or
otherwise modify the Premises prior to Tenant’s occupancy.

 

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Kashiwa Fudosan America, Inc. :: Novacea, Inc.

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3.2 LANDLORD’S PREPARATION. Landlord shall use reasonable diligence in
completing and preparing the Premises for Tenant’s occupancy in the manner and
subject to the terms, conditions, and covenants set forth in the Work Letter
Agreement. The facilities, materials, and work to be furnished, installed, and
performed in the Premises by Landlord pursuant to the Work Letter Agreement are
referred to as the “Work.” Any other installations, materials, and work which
may be undertaken by or for the account of Tenant to prepare, equip, decorate,
and furnish the Premises for Tenant’s occupancy are referred to as the “Tenant’s
Work.”

3.2.1 Readiness for Occupancy. The Premises shall be deemed ready for occupancy
on the earliest date on which all of the following conditions (the “Occupancy
Conditions”) have first been met:

 

  (a) Substantial Completion of Work. The Work has been substantially completed;
and it shall be so deemed notwithstanding the fact that minor or insubstantial
details of construction, mechanical adjustment, or decoration remain to be
performed, the noncompletion of which does not materially interfere with
Tenant’s beneficial use of the Premises for their intended purposes;

 

  (b) Access and Services. Reasonable means of access and facilities necessary
to Tenant’s use and occupancy of the Premises, including corridors, elevators,
stairways, heating, ventilating, air-conditioning, sanitary, water, and
electrical facilities (but exclusive of parking facilities) have been installed
and are in reasonably good operating order and available to Tenant; and

 

  (c) Certificate of Occupancy or Completion. A certificate of occupancy,
certificate of completion, final inspection card, or similar required
governmental approval (temporary or final) has been issued by the City of South
San Francisco permitting use of the Premises for office purposes.

3.2.2 Tenant Delays. If the occurrence of any of the Occupancy Conditions and
Landlord’s preparation of the Premises for occupancy shall be delayed owing to
either (a) any act, omission, or failure of Tenant or any of its employees,
agents, or contractors which shall continue after Landlord shall have given
Tenant reasonable notice that such act, omission, or failure would result in
delay, and such delay shall have been unavoidable by Landlord in the exercise of
reasonable diligence and prudence; or (b) the nature of any items of additional
work or change orders that Landlord undertakes to perform for the account of
Tenant (including any delays incurred by Landlord, after making reasonable
efforts, in procuring any materials, equipment, or fixtures of a kind or nature
not used by Landlord as part of its standard construction) (collectively “Tenant
Delays”), then the Premises shall be deemed ready for occupancy on the date when
they would have been ready but for such Tenant Delays.

3.3 EARLY ENTRY. During any period that Tenant shall be permitted to enter the
Premises prior to the Commencement Date other than to occupy the same (e.g., to
perform alterations or improvements), Tenant shall comply with all terms and
provisions of this Lease, except those provisions requiring the payment of Rent.
If Tenant shall be permitted to enter the Premises prior to the Commencement
Date for the purpose of occupying the same, Rent shall commence on such date at
the rate specified in the Table for the first period during which Rent is
payable after the Commencement Date; and if Tenant shall commence occupying only
a portion of the Premises prior to the Commencement Date, Rent shall be prorated
based on the number of rentable square feet occupied by Tenant. Landlord shall
permit early entry, provided the Premises are legally available and Landlord has
completed any Work required under this Lease. In no event shall Tenant’s early
entry extend or shorten the Term of the Lease set forth in § 1.2 above.

 

Oyster Point Marina Plaza Office Lease

Kashiwa Fudosan America, Inc. :: Novacea, Inc.

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3.4 NOTICE OF DEFECTS. It shall be conclusively presumed upon Tenant’s taking
actual possession of the Premises that the same were in satisfactory condition
(except for latent defects) as of the date of such taking of possession, unless
within thirty (30) days after the Commencement Date Tenant shall give Landlord
notice in writing specifying the respects in which the Premises were not in
satisfactory condition.

4    ADJUSTMENTS OF RENT

4.1 TAXES, UTILITIES, AND OPERATING EXPENSES. In addition to the Base Rent and
all other payments due under this Lease, Tenant shall pay to Landlord, in the
manner set forth in this Article 4, as Additional Rent, the following amounts:

 

  (a) Increased Operating Expenses. An amount equal to Tenant’s Pro Rata Share
of that portion of Operating Expenses paid by Landlord during each Adjustment
Period which exceeds the amount of Base Operating Expenses (as all of such terms
are defined in § 4.2 below).

 

  (b) Increased Utilities. An amount equal to Tenant’s Pro Rata Share of that
portion of Utilities paid by Landlord during each Adjustment Period which
exceeds the amount of Base Utilities (as all of such terms are defined in § 4.2
below).

 

  (c) Increased Taxes. An amount equal to Tenant’s Pro Rata Share of that
portion of Real Estate Taxes paid by Landlord during each Adjustment Period
which exceeds the amount of Base Real Estate Taxes (as all of such terms are
defined in § 4.2 below).

Tenant’s Pro Rata Share of (i) such increase in Operating Expenses over the Base
Operating Expenses, (ii) such increase in Utilities over Base Utilities, and
(iii) such increase in Real Estate Taxes over the Base Real Estate Taxes is
sometimes referred to collectively herein as the “Rental Adjustment.”

4.2 DEFINITIONS. For the purposes of this Lease, the following definitions shall
apply:

 

  (a) Base Operating Expenses. “Base Operating Expenses” means the total of
Operating Expenses paid by Landlord during calendar year 2008 (the “Base Expense
Year”), as adjusted under § 4.5 below.

 

  (b) Base Utilities. “Base Utilities” means the total of Utilities paid by
Landlord during calendar year 2008 (the “Base Utilities Year”), as adjusted
under § 4.5 below.

 

  (c) Base Real Estate Taxes. “Base Real Estate Taxes” means the total of Real
Estate Taxes paid by Landlord during calendar year 2008 (the “Base Tax Year”).

 

  (d) Tenant’s Pro Rata Share. “Tenant’s Pro Rata Share” as to the Building is
the percentage labeled as such in the Table in § 1.2 and is calculated by
dividing the agreed rentable area of the Premises (numerator) by the agreed
rentable area of the Property (denominator) and expressing the resulting
quotient as a percentage. “Tenant’s Pro Rata Share” as to the Complex is the
percentage labeled as such in the Table in § 1.2 as is calculated by dividing
the agreed rentable area of the Premises (numerator) by the agreed rentable area
of the Complex (denominator) and expressing the resulting quotient as a
percentage. Tenant’s Pro Rata Share shall be increased during the Term in
proportion to any increase in the area of the Premises in accordance with the
formula stated herein.

 

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Kashiwa Fudosan America, Inc. :: Novacea, Inc.

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  (e) Adjustment Period. “Adjustment Period” as to Operating Expenses,
Utilities, and Real Estate Taxes means each calendar year of which any portion
occurs during the Term, excluding the Base Year and beginning with the first
calendar year immediately following the Base Year.

 

  (f) Real Estate Taxes. “Real Estate Taxes” means all of the following charges,
whether or not now customary or in the contemplation of the parties hereto, and
whether or not general, special, ordinary, or extraordinary, which Landlord
shall pay during any Adjustment Period because of or in connection with the
ownership, leasing, or operation of the Property:

 

  (1) ad valorem real property taxes;

 

  (2) any form of assessment, license fee, license tax, business license fee,
commercial rental tax, levy, charge, fee, tax, or other imposition imposed by
any authority, including any city, county, state, or federal governmental
agency, or any school, agricultural, lighting, transportation, housing,
drainage, or other improvement or special assessment district thereof;

 

  (3) any tax on Landlord’s ‘right’ to rent or ‘right’ to other income from the
Building or as against Landlord’s business of leasing the Building;

 

  (4) any assessment, tax, fee, levy, or charge in substitution, partially or
totally, of any assessment tax, fee, levy or charge previously included within
the definition of Real Estate Taxes, it being acknowledged by Tenant and
Landlord that Proposition 13 was adopted by the voters of the State of
California in the Election of June, 1978, and that assessments, taxes, fees,
levies, and charges may be imposed by governmental agencies for such services as
fire protection, street, sidewalk, and road maintenance, refuse removal, and for
other governmental services formerly provided without charge to property owners
or occupants, and it being the intention of Tenant and Landlord that all such
new and increased assessments, taxes, fees, levies, and charges be included
within the definition of Real Estate Taxes for the purposes of this Lease;

 

  (5) any assessment, tax, fee, levy, or charge allocable to or measured by the
area of the Building or Property or the Rent payable hereunder, including any
gross income tax or excise tax levied by any city, county, state, or federal
governmental agency or any political subdivision thereof with respect to the
receipt of such Rent, or upon or with respect to the possession, leasing,
operating, management, maintenance, alteration, repair, use, or occupancy by
Tenant of the Property or any portion thereof;

 

  (6) any assessment, tax, fee, levy, or charge upon this transaction or any
document to which Tenant is a party, creating or transferring an interest or an
estate in the Building or Property;

 

  (7) any assessment, tax, fee, levy, or charge by any governmental agency
related to any transportation plan, fund, or system instituted within the
geographic area of which the Building is a part; or

 

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Kashiwa Fudosan America, Inc. :: Novacea, Inc.

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  (8) reasonable legal and other professional fees, costs and disbursements
incurred in connection with proceedings to contest, determine or reduce Real
Estate Taxes.

Exclusions. Notwithstanding the foregoing, Real Estate Taxes shall not include
(A) federal, state, or local income taxes; (B) franchise, gift, transfer,
excise, capital stock, estate, succession, or inheritance taxes; or
(C) penalties or interest for late payment of Real Estate Taxes.

 

  (g) Operating Expenses. “Operating Expenses” means all expenses, costs, and
amounts (other than Real Estate Taxes and Utilities) of every kind and nature
which Landlord shall pay during any Adjustment Period of which any portion
occurs during the Term, because of or in connection with the ownership,
management, repair, maintenance, restoration, and/or operation of the Property,
including costs of the following:

 

  (1) permits, licenses, and certificates necessary to operate, manage, and
lease the Property;

 

  (2) supplies, tools, equipment, and materials used in the operation, repair,
and maintenance of the Property;

 

  (3) all insurance premiums for any insurance policies deemed necessary or
desirable by Landlord (including workers’ compensation, health, accident, group
life, public liability, property damage, earthquake, and fire and extended
coverage insurance for the full replacement cost of the Property as required by
Landlord or its lenders for the Property);

 

  (4) the deductible portion of any claim paid under any insurance policy
maintained by Landlord in connection with its management and operation of the
Property;

 

  (5) accounting, legal, inspection, consulting, concierge, and other services;

 

  (6) services of independent contractors;

 

  (7) compensation (including employment taxes and fringe benefits) of all
persons who perform duties in connection with the operation, maintenance,
repair, or overhaul of the Building or Property, and equipment, improvements,
and facilities located within the Property, including engineers, janitors,
painters, floor waxers, window washers, security, parking personnel, and
gardeners;

 

  (8) operation and maintenance of a room for delivery and distribution of mail
to tenants of the Building as required by the U.S. Postal Service (including an
amount equal to the fair market rental value of the mail room premises);

 

  (9) management of the Building or Property, whether managed by Landlord or an
independent contractor (including an amount equal to the fair market value of
any on-site manager’s office);

 

  (10)

rental expenses for (or a reasonable depreciation allowance on) personal
property used in maintenance, operation, or repair of the Property and

 

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Kashiwa Fudosan America, Inc. :: Novacea, Inc.

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installment equipment purchase or equipment financing agreements for such
personal property;

 

  (11) costs, expenditures, or charges (whether capitalized or not) required by
any governmental or quasi-governmental authority after the Commencement Date;

 

  (12) payments under any easement, operating agreement, declaration,
restrictive covenant, or instrument pertaining to the sharing of costs in any
planned development;

 

  (13) amortization of capital expenses (including financing costs) incurred by
Landlord after the Commencement Date in order to (A) comply with Laws,
(B) reduce Property Operating Expenses or Utilities, or (C) upgrade the utility,
efficiency, or capacity of any utility or telecommunication systems serving
tenants of the Property;

 

  (14) operation, repair, and maintenance of all Systems and Equipment and
components thereof (including replacement of components); janitorial service;
alarm and security service; window cleaning; trash removal; elevator
maintenance; cleaning of walks, parking facilities, and building walls; removal
of ice and snow; replacement of wall and floor coverings, ceiling tiles, and
fixtures in lobbies, corridors, restrooms and other common or public areas or
facilities; maintenance and repair of the roof and exterior fabric of the
Building, including replacement of glazing as needed; maintenance and
replacement of shrubs, trees, grass, sod, and other landscaped items, irrigation
systems, drainage facilities, fences, curbs, and walkways; repaving and
restriping parking facilities; and roof repairs;

 

  (15) the operation of any on-site maintenance shop(s) and the operation and
maintenance of the Athletic Facility, any other fitness center, conference
rooms, and all other common areas and amenities in the Property;

 

  (16) provision of shuttle busses, shuttle services, and drivers between the
Complex and BART and SF0 airport, as required by the Bay Area Regional
Transportation Act and deed covenants and restrictions applicable to the
Complex; and

 

  (17) any other costs or expenses incurred by Landlord which are reasonably
necessary to operate, repair, manage, and maintain the Building and Property in
a first-class manner and condition and which are not otherwise reimbursed by
tenants of the Building.

Exclusions. Notwithstanding the foregoing, Operating Expenses shall not include
(A) depreciation, interest, and amortization on Superior Mortgages (as defined
in § 18.1 below), and other debt costs or ground lease payments, if any;
(B) legal fees in connection with leasing, tenant disputes, or enforcement of
leases; (C) real estate brokers’ leasing commissions; (D) improvements or
alterations to tenant spaces; (E) the cost of providing any service directly to,
and reimbursed or paid directly by, any tenant; (F) any costs expressly excluded
from Operating Expenses elsewhere in this Lease; (G) costs of any items to the
extent Landlord receives reimbursement from insurance proceeds or from a third
party

 

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Kashiwa Fudosan America, Inc. :: Novacea, Inc.

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(such proceeds to be deducted from Operating Expenses in the year in which
received); (H) capital expenditures, except those expressly permitted above;
provided, all such permitted capital expenditures (together with reasonable
financing charges) shall be amortized for purposes of this Lease over the
shorter of (x) their useful lives, (y) the period during which the reasonably
estimated savings in Operating Expenses equals the expenditures, or (z) three
(3) years.

 

  (h) Utilities. “Utilities” means all expenses, costs, and amounts of every
kind and nature which Landlord shall pay during any Adjustment Period of which
any portion occurs during the Term, because of or in connection with the
electricity, power, gas, steam, oil or other fuel, water, sewer, lighting,
heating, air conditioning, and ventilating delivered to or consumed or used in
or on the Property.

4.3 MANNER OF PAYMENT. To provide for current payments of the Rental Adjustment,
Tenant shall pay as Additional Rent during each Adjustment Period an amount
equal to Landlord’s estimate of the Rental Adjustment which will be payable by
Tenant for such Adjustment Period. Such payments shall be made in monthly
installments, commencing on the first day of the month following the month in
which Landlord notifies Tenant of the amount it is to pay hereunder and
continuing until the first day of the month following the month in which
Landlord gives Tenant a new notice of the estimated Rental Adjustment. It is the
intention hereunder to estimate from time to time the amount of Tenant’s Rental
Adjustment for each Adjustment Period and then to effect a reconciliation in the
following year based on the actual expenses incurred for the preceding
Adjustment Period, as provided in 4.4 below.

4.4 RECONCILIATION. On or before the first day of April of each year after the
first Adjustment Period (or as soon thereafter as is practical), Landlord shall
deliver to Tenant a statement (the “Statement”) setting forth the Rental
Adjustment for the preceding year. If the actual Rental Adjustment for the
preceding Adjustment Period exceeds the total of the estimated monthly payments
made by Tenant for such Adjustment Period, Tenant shall pay Landlord the amount
of the deficiency within ten (10) days of the receipt of the Statement. If such
total of estimated payments made exceeds the actual Rental Adjustment for such
Adjustment Period, then Tenant shall receive a credit for the difference against
payments of Rent next due. If the credit is due from Landlord on the Expiration
Date, Landlord shall pay Tenant the amount of the credit, less any Rent then
due. The obligations of Tenant and Landlord to make payments required under this
§ 4.4 shall survive the expiration or earlier termination of the Term of this
Lease.

4.4.1 Changes in Method. So long as Tenant’s obligations hereunder are not
materially adversely affected thereby, Landlord reserves the right reasonably to
change from time to time the manner or timing of the foregoing payments. In lieu
of providing one Statement covering Real Estate Taxes, Utilities, and Operating
Expenses, Landlord may provide separate statements, at the same or different
times. No delay by Landlord in providing the Statement (or separate statements)
shall be deemed a default by Landlord or a waiver of Landlord’s right to require
payment of Tenant’s obligations for actual or estimated Real Estate Taxes,
Utilities, or Operating Expenses. In no event shall a decrease in Real Estate
Taxes, Utilities, or Operating Expenses below the Base Operating Expenses, Base
Utilities, or Base Real Estate Taxes ever decrease the monthly Base Rent or give
rise to a credit in favor of Tenant.

4.4.2 Proration of Rental Adjustment. If the Term does not commence on January 1
or does not end on December 31, Tenant’s obligations to pay estimated and actual
amounts towards Real Estate Taxes, Utilities, and Operating Expenses for such
first or final calendar year shall be prorated to reflect the portion of such
year(s) included in the Term. Such proration shall be made by multiplying the
total estimated or actual (as the case may be) Real Estate Taxes, Utilities, and

 

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Operating Expenses for such calendar year(s), as well as the Base Real Estate
Taxes, Base Utilities, and Base Operating Expenses, by a fraction, the numerator
of which shall be the number of days of the Term during such calendar year, and
the denominator of which shall be three hundred sixty-five (365).

4.5 GROSS-UP. If the Building is less than ninety-five percent (95%) occupied
during the Base Period or any Adjustment Period, then Operating Expenses,
Utilities, and Real Estate Taxes for the Base Period and/or such Adjustment
Period shall be “grossed up” to that amount of Operating Expenses, Utilities,
and Real Estate Taxes that, using reasonable projections, would normally have
been incurred during the Base Period and/or such Adjustment Period if the
Building had been ninety-five percent (95%) occupied during the Base Period
and/or such Adjustment Period, as determined in accordance with sound accounting
and management practices, consistently applied. Only those component elements or
items of expense of Operating Expenses, Utilities, and Real Estate Taxes that
are affected by variations in occupancy levels shall be grossed up.

4.6 ADJUSTMENT OF BASE OPERATING EXPENSES. Notwithstanding anything to the
contrary contained in the Lease, the parties agree that Base Operating Expenses
and Operating Expenses for any subsequent Adjustment Period (herein called
“Subsequent Operating Expenses”) shall be subject to further adjustment by
Landlord as follows:

 

  (a) Exclusion of Capital Expenditures. Landlord may exclude from Base
Operating Expenses capital expenditures otherwise permitted, provided Landlord
shall also exclude any amortization of such expenditures from Subsequent
Operating Expenses.

 

  (b) Elimination of Recurring Expenses. If Landlord eliminates from any
Subsequent Operating Expenses a category of recurring expenses previously
included in Base Operating Expenses, Landlord may subtract such category from
Base Operating Expenses commencing with such subsequent Adjustment Period.

 

  (c) New Recurring Expenses. If Landlord includes a new category of recurring
Subsequent Operating Expenses not previously included in Base Operating
Expenses, Landlord shall also include an amount (the “Assumed Base Amount”) for
such category in Base Operating Expenses commencing in such subsequent
Adjustment Period.

 

  (d) Assumed Base Amount. The “Assumed Base Amount” under § 4.6(c) above shall
be the annualized amount of expenses for such new category in the first
Adjustment Period it is included, reduced by an amount determined in Landlord’s
sole good faith discretion (but in no event by an amount less than five percent
(5%)) for each full or partial Adjustment Period that has elapsed during the
Term of the Lease before such Adjustment Period.

4.7 ADJUSTMENT OF REAL ESTATE TAXES. If Base Real Estate Taxes are reduced as
the result of protest, by means of agreement, as the result of legal
proceedings, or otherwise, Landlord may adjust Tenant’s obligations for Real
Estate Taxes in all years affected by any refund of taxes following the Base Tax
Year; and Tenant shall pay Landlord within thirty (30)days after notice any
additional amount required by such adjustment for any Adjustment Periods that
have theretofore occurred. Tenant shall be entitled to receive a share of any
refund or abatement of Real Estate Taxes received by Landlord to the extent of
and in proportion to Tenant’s actual contribution to the amount of Real Estate
Taxes paid by Landlord during the period to which such refund or abatement
relates, but in no event shall Tenant be entitled to any refund with respect to
Real Estate Taxes paid by Landlord during Tenant’s Base Tax Year. If Real Estate

 

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Taxes for any Adjustment Period during the Term or any extension thereof shall
be increased after payment thereof by Landlord for any reason, including error
or reassessment by applicable governmental authorities, Tenant shall pay
Landlord upon demand Tenant’s Pro Rata Share of such increased Real Estate
Taxes. Tenant shall pay increased Real Estate Taxes whether Real Estate Taxes
are increased as a result of increases in the assessment or valuation of the
Property (whether based on a sale, change in ownership, refinancing of the
Property, or otherwise), increases in the tax rates, reduction or elimination of
any rollbacks or other deductions available under current law, scheduled
reductions of any tax abatement, as a result of the elimination, invalidity, or
withdrawal of any tax abatement, or for any other cause whatsoever.
Notwithstanding the foregoing, if any Real Estate Taxes shall be paid based on
assessments or bills by a governmental authority using a fiscal year other than
a calendar year, Landlord may elect to average the assessments or bills for the
subject calendar year, based on the number of months of such calendar year
included in each such assessment or bill.

4.8 ALLOCATION WITHIN COMPLEX. So long as the Property shall be part of the
Complex collectively owned or managed by Landlord or its affiliates or
collectively managed by Landlord’s managing agent, Landlord may allocate Real
Estate Taxes, Utilities, and Operating Expenses within the Complex and between
the buildings and structures comprising the Complex and the parcels on which
they are located, in accordance with sound accounting and management principles.
In the alternative, Landlord shall have the right to determine, in accordance
with sound accounting and management principles, Tenant’s Pro Rata Share of Real
Estate Taxes, Utilities, and Operating Expenses based upon the totals of each of
the same for all such buildings and structures, the land constituting parcels on
which the same are located, and all related facilities, including common areas
and easements, corridors, lobbies, sidewalks, elevators, loading areas, parking
facilities, driveways, and other appurtenances and public areas, in which event
Tenant’s Pro Rata Share shall be based on the ratio of the rentable area of the
Premises to the rentable area of all buildings in the Complex.

4.9 LANDLORD’S RECORDS. Landlord shall maintain records with respect to Real
Estate Taxes, Utilities, and Operating Expenses and determine the same in
accordance with sound accounting and management practices, consistently applied.
Although this Lease contemplates the computation of Real Estate Taxes,
Utilities, and Operating Expenses on a cash basis, Landlord shall make
reasonable and appropriate accrual adjustments to ensure that each Adjustment
Period includes substantially the same recurring items. Landlord reserves the
right to change to a full accrual system of accounting so long as the same is
consistently applied and Tenant’s obligations are not materially adversely
affected. Tenant or its representative shall have the right to examine such
records, upon reasonable prior written notice specifying such records Tenant
desires to examine, during normal business hours at the place or places where
such records are normally kept, by sending such notice no later than forty-five
(45) days following the furnishing of the Statement.

4.10 OTHER TAXES PAYABLE BY TENANT. In addition to the Base Rent and any other
charges to be paid by Tenant hereunder, Tenant shall, as an element of Rent,
reimburse Landlord upon demand for any and all taxes payable by Landlord (other
than net income taxes) which are not otherwise reimbursable under this Lease,
whether or not now customary or within the contemplation of the parties, where
such taxes are upon, measured by, or reasonably attributable to (A) the cost or
value of Tenant’s equipment, furniture, fixtures, and other personal property
located at the Premises, or the cost or value of any improvements made in or to
the Premises by or for Tenant, regardless of whether title to such improvements
is held by Tenant or Landlord; (B) the gross or net Rent payable under this
Lease, including any rental or gross receipts tax levied by any taxing authority
with respect to the receipt of the Rent hereunder; (C) the possession, leasing,
operation, management, maintenance, alteration, repair, use, or occupancy by
Tenant of the Premises or any portion thereof; or (D) this transaction or any
document to which Tenant is a party creating or transferring an interest or an
estate in the Premises. Tenant shall pay any rent tax, sales tax,

 

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service tax, transfer tax, value-added tax, or any other applicable tax on the
Rent or services herein or otherwise respecting this Lease.

4.11 RENT CONTROL. If the amount of Rent or any other payment due under this
Lease violates the terms of any governmental restrictions on such Rent or
payment, then the Rent or payment due during the period of such restrictions
shall be the maximum amount allowable under those restrictions. Upon termination
of the restrictions, Landlord shall, to the extent it is legally permitted,
recover from Tenant the difference between the amounts received during the
period of the restrictions and the amounts Landlord would have received had
there been no restrictions.

5    SECURITY DEPOSIT

5.1 DEPOSIT FOR SECURITY. Tenant shall deposit with Landlord an irrevocable
sight-draft, on-demand letter of credit in the amount of Seven Hundred and
Seventy Thousand Dollars ($770,000.00) (the “Security Deposit”) upon Tenant’s
execution and submission of this Lease. The letter of credit shall be in a form
and drawn upon an institution reasonably acceptable to Landlord. The letter of
credit shall specify that it shall remain in force and be renewed annually
automatically during the Term of the Lease, unless Landlord shall have received
not less than thirty (30) days’ days written notice of cancellation or
nonrenewal by the issuer, in which case Tenant shall substitute a new letter or
credit on or before the expiration or cancellation of the existing letter of
credit. The Security Deposit shall serve as security for the prompt, full, and
faithful performance by Tenant of the terms and provisions of this Lease,
including the value of future rents as damages in accordance with California
Civil Code § 1951.2, as set forth in § 20.3 below. Landlord shall not be
required to keep the Security Deposit separate from Landlord’s general funds or
pay interest on the Security Deposit.

5.1.1 Application of Deposit. In the event that Tenant is in Default hereunder
and fails to cure within any applicable time permitted under this Lease, or in
the event that Tenant owes any amounts to Landlord upon the expiration of this
Lease, Landlord may use or apply the whole or any part of the Security Deposit
for the payment of Tenant’s obligations hereunder. The use or application of the
Security Deposit or any portion thereof shall not prevent Landlord from
exercising any other right or remedy provided hereunder or under any Law and
shall not be construed as liquidated damages.

5.1.2 Restoration of Full Deposit. In the event the Security Deposit is reduced
by such use or application, Tenant shall deposit with Landlord, within ten
(10) days after written notice, an amount sufficient to restore the full amount
of the Security Deposit. If the Premises shall be expanded at any time, or if
the Term shall be extended at any increased rate of Rent, the Security Deposit
shall thereupon be proportionately increased.

5.1.3 Disposition of Security Deposit. After the Expiration Date or any earlier
termination of the Lease, any remaining portion of the Security Deposit shall be
returned to Tenant after deduction of all amounts due as Rent or otherwise.
Tenant expressly waives the provisions of § 1950.7 of the California Civil Code.

6    COMPLIANCE WITH LAWS

6.1 TENANT’S COMPLIANCE WITH LAWS. Tenant shall use the Premises in compliance
with all applicable federal, state, county, and local governmental and municipal
laws, statutes, ordinances, rules, regulations, codes, decrees, orders, and
other such requirements, and decisions by courts in cases where such decisions
are considered binding precedents in the State of California (the “State”), and
decisions of federal courts applying the laws of the State (collectively
“Laws”). Tenant shall, at its sole cost and

 

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expense, promptly comply with each and all of such Laws, and also with the
requirements of any board of fire underwriters or other similar body now or
hereafter constituted to deal with the condition, use, or occupancy of the
Premises, except in the case of required structural changes not triggered by
Tenant’s change in use of the Premises or Tenant’s alterations, additions, or
improvements therein. Tenant shall comply with all applicable Laws regarding the
physical condition of the Premises, but only to the extent that the applicable
Laws pertain to the particular manner in which Tenant uses the Premises or the
particular use to which Tenant puts the Premises, if different from that
permitted under Article 2 of this Lease. Tenant shall also comply with all
applicable Laws which do not relate to the physical condition of the Premises
and with which only the occupant can comply, such as laws governing maximum
occupancy, workplace smoking, VDT regulations, and illegal business operations,
such as gambling. The judgement of any court of competent jurisdiction or the
admission of Tenant in any judicial action, regardless of whether Landlord is a
party thereto, that Tenant has violated any of such Laws shall be conclusive of
that fact as between Landlord and Tenant.

6.1.1 Code Costs. Notwithstanding anything to the contrary in this Article 6, if
the requirement of any public authority obligates either Landlord or Tenant to
expend money in order to bring the Premises and/or any area of the Property into
compliance with Laws as a result of (a) Tenant’s particular use or alteration of
the Premises; (b) Tenant’s change in the use of the Premises; (c) the manner of
conduct of Tenant’s business or operation of its installations, equipment, or
other property therein; (d) any cause or condition created by or at the instance
of Tenant, other than by Landlord’s performance of any work for or on behalf of
Tenant; or (e) breach of any of Tenant’s obligations hereunder, then Tenant
shall bear all costs (“Code Costs”) of bringing the Premises and/or Property
into compliance with Laws, whether such Code Costs are related to structural or
nonstructural elements of the Premises or Property.

6.2 LANDLORD’S COMPLIANCE WITH LAWS. Landlord represents that on the
Commencement Date Landlord has no actual knowledge of any violation of any
applicable Laws respecting the Premises. During the Term Landlord shall comply
with all applicable Laws regarding the Premises and Property, except to the
extent Tenant must comply under § 6.1 above.

7    HAZARDOUS MATERIALS

7.1 REGULATION OF HAZARDOUS MATERIALS. Tenant shall not transport, use, store,
maintain, generate, manufacture, handle, dispose, release, or discharge any
“Hazardous Material” (as defined below) upon or about the Property, nor permit
Tenant’s employees, agents, contractors, and other occupants of the Premises to
engage in such activities upon or about the Property. However, the foregoing
provisions shall not prohibit the transportation to and from, and use, storage,
maintenance, and handling within, the Premises of substances customarily used in
offices, provided all of the following conditions are met:

 

  (a) such substances shall be used and maintained only in such quantities as
are reasonably necessary for such permitted use of the Premises, strictly in
accordance with applicable Laws and the manufacturers’ instructions therefor;

 

  (b) such substances shall not be disposed of, released, or discharged on the
Property and shall be transported to and from the Premises in compliance with
all applicable Laws, and as Landlord shall reasonably require;

 

  (c)

if any applicable Laws or Landlord’s trash removal contractor requires that any
such substances be disposed of separately from ordinary trash, Tenant shall make
arrangements at Tenant’s expense for such disposal directly with a qualified and
licensed disposal company at a lawful disposal site (subject to scheduling and

 

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approval by Landlord), and shall ensure that disposal occurs frequently enough
to prevent unnecessary storage of such substances in the Premises; and

 

  (d) any remaining such substances shall be completely, properly, and lawfully
removed from the Property upon expiration or earlier termination of this Lease.

7.1.1 DEFINITION OF HAZARDOUS MATERIAL. The term “Hazardous Material” for
purposes hereof shall mean any chemical, substance, material, or waste or
component thereof which is now or hereafter listed, defined, or regulated as a
hazardous or toxic chemical, substance, material, or waste or component thereof
by any federal, state, or local governing or regulatory body having
jurisdiction, or which would trigger any employee or community “right-to-know”
requirements adopted by any such body, or for which any such body has adopted
any requirements for the preparation or distribution of an MSDS.

7.2 NOTIFICATION OF LANDLORD. Tenant shall promptly notify Landlord of (A) any
enforcement, cleanup, or other regulatory action taken or threatened by any
governmental or regulatory authority with respect to the presence of any
Hazardous Material on the Premises or the migration thereof from or to other
property; (B) any demands or claims made or threatened by any party against
Tenant or the Premises relating to any loss or injury resulting from any
Hazardous Material on or from the Premises; and (C) any matters where Tenant is
required by law to give a notice to any governmental or regulatory authority
respecting any Hazardous Material on the Premises. Landlord shall have the right
(but not the obligation) to join and participate, as a party, in any legal
proceedings or actions affecting the Premises initiated in connection with any
environmental, health, or safety law.

7.3 LIST OF HAZARDOUS MATERIALS. At such times as Landlord may reasonably
request, Tenant shall provide Landlord with a written list identifying any
Hazardous Material then used, stored, or maintained upon the Premises, the use
and approximate quantity of each such material, a copy of any material safety
data sheet (“MSDS”) issued by the manufacturer thereof, written information
concerning the removal, transportation, and disposal of the same, and such other
information as Landlord may reasonably require or as may be required by law.

7.4 CLEANUP. If any Hazardous Material is released, discharged or disposed of by
Tenant or any other occupant of the Premises, or their employees, agents, or
contractors, on or about the Property in violation of the foregoing provisions,
Tenant shall immediately, properly, and in compliance with applicable Laws clean
up and remove the Hazardous Material from the Property and any other affected
property and clean or replace any affected personal property (whether or not
owned by Landlord), at Tenant’s expense. Such clean up and removal work shall be
subject to Landlord’s prior written approval (except in emergencies), and shall
include any testing, investigation, and the preparation and implementation of
any remedial action plan required by any governmental body having jurisdiction
or reasonably required by Landlord. If Tenant shall fail to comply with the
provisions of this § 7.2 within five (5) days after written notice by Landlord,
or such shorter time as may be required by Laws or in order to minimize any
hazard to persons or property, Landlord may (but shall not be obligated to)
arrange for such compliance directly or as Tenant’s agent through contractors or
other parties selected by Landlord, at Tenant’s expense (without limiting
Landlord’s other remedies under this Lease or applicable Laws).

7.5 CASUALTY DAMAGE. If any Hazardous Material is released, discharged, or
disposed of on or about the Property and such release, discharge, or disposal is
not caused by Tenant or other occupants of the Premises, or their employees,
agents, or contractors, such release, discharge, or disposal shall be deemed
casualty damage under Article 15 to the extent that the Premises or common areas
serving the Premises are affected thereby; in such case, Landlord and Tenant
shall have the obligations and rights respecting such casualty damage provided
under Article 15 of this Lease.

 

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7.6 REFRIGERANT. Tenant shall not install any refrigerant-containing systems or
equipment, including refrigerators, freezers, supplemental HVAC systems or
self-contained air conditioners, without Landlord’s prior approval, which
Landlord may withhold in its sole discretion. Unless Tenant shall have obtained
Landlord’s prior written approval to install existing equipment after an
inspection, at Tenant’s sole cost and expense, by Landlord’s engineer for
defects and proper proposed installation in the Premises, all
refrigerant-containing equipment and/or systems which Tenant installs in the
Premises shall be new. Whether Tenant’s refrigerant-containing equipment or
systems are defective and are properly installed shall be determined at the sole
discretion of Landlord’s engineer. If Tenant wishes to install any
refrigerant-containing equipment or systems, Tenant shall obtain and provide
Landlord with copies of all required permits associated with such equipment or
systems.

7.6.1 Removal of Refrigerant. Notwithstanding anything to the contrary in this
Lease, Tenant shall remove all refrigerant and refrigerant-containing equipment
and/or systems installed in the Premises by or on behalf of Tenant prior to the
Expiration Date of this Lease. Prior to the removal of any such refrigerant or
refrigerant-containing equipment and/or systems, Tenant shall submit to Landlord
for Landlord’s approval, the names of Tenant’s contractors and all plans and
specifications for such removal. Tenant and Tenant’s contractors shall comply
with all legal requirements, industry practices and rules established by
Landlord in performing such removal work. Tenant shall repair any damage to the
Property or the Systems and Equipment associated with such removal, and Tenant
shall be responsible for the costs associated with restoring the Property to the
condition which existed immediately prior to any modification undertaken by
Landlord in order to accommodate Tenant’s refrigerant-containing equipment or
systems.

8    SERVICES AND UTILITIES

8.1 LANDLORD’S SERVICES. Landlord agrees to provide, on the terms and conditions
specified herein, the following services and utilities for Tenant’s use and
consumption in the Premises, the cost of which shall be included in Operating
Expenses and/or Utilities and reimbursed to Landlord in accordance with § 4.1
above:

 

  (a) Electricity. Electricity for standard office lighting fixtures and for
equipment and accessories customary for offices, provided (i) the connected
electrical load of all the same does not exceed an average of four (4) watts per
usable square foot of the Premises (or such lesser amount as may be available,
based on the safe and lawful capacity of the existing electrical circuit(s) and
facilities serving the Premises); (ii) the electricity will be at nominal 120
volts, single phase (or 110 volts, depending on available service in the
Building); and (iii) the safe and lawful capacity of the existing electrical
circuit(s) serving the Premises is not exceeded. Landlord will permit its
electric feeders, risers, and wiring servicing the Premises to be used by Tenant
to the extent available and safely capable of being used for such purpose.

 

  (b) Telecommunications Interface. Interface with the telephone network at the
demarcation point or minimum point of entry (“MPOE”) supplied by the local
regulated public utility by means of Landlord’s INC consisting of cable pairs
with a capacity consistent with the engineering standards to which the Building
was designed.

 

  (c)

HVAC. Heat, ventilation, and air-conditioning (“HVAC”) to provide a temperature
required, in Landlord’s reasonable opinion and in accordance with applicable
Laws, for the comfortable occupancy of the Premises during business hours (as
defined in § 8.1.1 below). Landlord shall not be responsible for inadequate
air-conditioning or ventilation to the extent the same occurs because Tenant
uses any item of equipment consuming more than

 

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500 watts at rated capacity without providing adequate air-conditioning and
ventilation therefor.

 

  (d) Water. Water for drinking, lavatory and toilet purposes at those points of
supply provided for nonexclusive general use of other tenants at the Property.

 

  (e) Janitorial Services. Customary office cleaning and trash removal service
Monday through Friday or Sunday through Thursday in and about the Premises.

 

  (f) Elevator Services. Operatorless passenger elevator service and freight
elevator service (if the Property has such equipment serving the Premises, and
subject to scheduling by Landlord) in common with Landlord and other tenants and
their contractors, agents, and visitors.

8.1.1 Business Hours. The term business hours in this Lease shall mean the hours
from 8:00 a.m. until 6:00 p.m. on Monday through Friday and from 9:00 a.m. until
1:00 p.m. on Saturday throughout the year, except for New Year’s Day,
Presidents’ Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day,
Christmas Day, and any other federally-observed holiday which may be created
during the Term (“Holidays”).

8.2 ADDITIONAL ELECTRICAL CAPACITY. Any additional risers, feeders, or other
equipment or service proper or necessary to supply Tenant’s electrical
requirements will be installed by Landlord, upon written request of Tenant, at
the sole cost and expense of Tenant, if, in Landlord’s sole judgement, the same
are necessary and will not cause permanent damage or injury to the Property, the
Premises, or the Systems and Equipment or cause or create a dangerous or
hazardous condition or entail excessive or unreasonable alterations, repairs, or
expense or interfere with or disturb other tenants or occupants. Rigid conduit
only will be allowed.

8.2.1 Approved Electrical Load. Tenant agrees not to connect any additional
electrical equipment of any type to the building electric distribution system,
beyond that on Tenant’s approved plans for initial occupancy, other than lamps,
typewriters, and other office machines which consume comparable amounts of
electricity or other electrical equipment which in the aggregate consumes the
same amount of electricity as those approved for initial occupancy and will not
result in any overload of electrical circuits, lines, or wiring, without
Landlord’s prior written consent. In no event shall Tenant use or install any
fixtures, equipment, or machines the use of which in conjunction with other
fixtures, equipment, and machines in the Premises would result in an overload or
the electrical circuits servicing the Premises. Tenant covenants and agrees that
at all times its use of electric current shall never exceed the capacity of the
feeders to the Building or the risers or wiring installation existing at the
time in question.

8.3 ADDITIONAL TELECOMMUNICATIONS CAPACITY. If Tenant desires any
telecommunications capacity in excess of that available as of the Commencement
Date in the form of the INC between the MPOE and the telephone closet nearest
the Premises and provided pursuant to § 8.1 above, Tenant shall bear the cost of
installing additional risers or INC or replacing existing INC serving the
Premises pursuant to Article 9 below.

8.4 REPLACEMENT BULBS AND TUBES. Tenant shall furnish, install, and replace, as
required, all non-Building-standard lighting tubes, lamps, bulbs, and ballasts
required in the Premises, at Tenant’s sole cost and expense. All lighting tubes,
lamps, bulbs, and ballasts so installed become Landlord’s property upon the
expiration or sooner termination of this Lease.

 

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8.5 TWENTY-FOUR HOURS ACCESS. Subject to the provisions of § 8.8, Tenant, its
employees, agents, and invitees shall have access to the Premises twenty-four
(24) hours a day, seven (7) days a week. Landlord may restrict access outside of
business hours by requiring persons to show a badge or identification card
issued by Landlord. Landlord shall not be liable for denying entry to any person
unable to show the proper identification. Landlord may without liability
temporarily close the Building if required because of a life-threatening or
Building-threatening situation.

8.6 EXTRA SERVICES. Landlord shall, subject to all applicable Laws, seek to
provide such utilities or services in excess of those Landlord is required to
provide under § 8.1 above as Tenant may from time to time request, if the same
are reasonable and feasible for Landlord to provide and do not involve
modifications or additions to the Property or the Systems and Equipment and if
Landlord shall receive Tenant’s request within a reasonable period prior to the
time such extra utilities or services are required. Landlord may comply with
written or oral requests by any officer or employee of Tenant, unless Tenant
shall notify Landlord of, or Landlord shall request, the names of authorized
individuals (up to three (3) for each floor on which the Premises are located)
and procedures for written requests. Tenant shall, for such extra utilities or
services, pay such charges as Landlord shall from time to time establish.

8.6.1 Extraordinary Service Usage. If Tenant shall utilize Building services for
the Premises at any time other than during business hours, Landlord shall
furnish such extraordinary services (excluding air-conditioning, except as
provided below) at Landlord’s then-current prevailing rate for such services. In
addition to the foregoing services, if Tenant shall require air-conditioning
service for the Premises at any time other than during business hours, Landlord
shall, upon reasonable advance notice from Tenant, furnish such after-hours
air-conditioning service at Landlord’s then-current prevailing rate for such
services as a separate charge; provided, however, in the event Tenant requests
such after-hours air-conditioning service at a time not immediately preceding or
immediately succeeding times when “regular hours” service is being furnished
hereunder, then Tenant must request not less than five (5) hours of after-hours
air-conditioning service. Notwithstanding anything contained herein to the
contrary, Landlord’s prevailing rate for the extraordinary services described
herein shall be subject to increase from time to time as Landlord may reasonably
determine.

8.6.2 Payment for Excess Usage. All charges for extra utilities or services or
those requested outside business hours shall be due at the same time as the
installment of Base Rent with which the same are billed, or if billed
separately, shall be due within twenty (20) days after such billing.

8.6.3 Changes in HVAC System. Use of the Premises, or any part thereof, in a
manner exceeding the design conditions (including occupancy and connected
electrical load) for the heating or cooling units in the Premises, or
rearrangement of partitioning which interferes with normal operation of the HVAC
system in the Premises, may require changes in the HVAC system servicing the
Premises. Such changes shall be made by Tenant, at its expense, as Tenant’s
Changes pursuant to Article 9. Tenant shall not change or adjust any closed or
sealed thermostat or other element of the HVAC system without Landlord’s express
prior written consent.

8.6.4 Separate Metering. Landlord may install and operate meters or any other
reasonable system for monitoring or estimating any services or utilities used by
Tenant in excess of those required to be provided by Landlord under this Article
8 (including a system for Landlord’s engineer reasonably to estimate any such
excess usage). If such system indicates such excess services or utilities,
Tenant shall pay Landlord’s reasonable charges for installing and operating such
system and any supplementary air-conditioning, ventilation, heat, electrical, or
other systems or equipment (or adjustments or modifications to the existing
Systems and Equipment), and Landlord’s reasonable charges for such amount of
excess services or utilities used by Tenant. If Tenant’s use of extra

 

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utilities or services causes Landlord’s regulated baseline quantities of water,
gas, electricity, or any other utility or service to be exceeded, Tenant shall
pay for such excess quantities of such utilities or services at the rate which
is imposed upon Landlord for quantities in excess of the regulated baseline. In
addition, Tenant shall pay prior to delinquency any fine or penalty which may be
imposed upon or assessed against Landlord or the Building or the Property by
virtue of Tenant’s excess usage of any services or utilities, including water,
gas, and electricity.

8.7 INTERRUPTION OF SERVICES. Landlord does not warrant that any services or
utilities provided hereunder for Tenant’s use in the Premises will be free from
shortages, failures, variations, or interruptions caused by repairs,
maintenance, replacements, improvements, alterations, changes of service,
strikes, lockouts, labor controversies, accidents, inability to obtain services,
fuel, steam, water or supplies, governmental requirements or requests, or other
causes beyond Landlord’s reasonable control, including interference with light
or other incorporeal hereditaments and any interruption in services or any
failure to provide services to Landlord by a designated utility company at the
demarcation point at which Landlord accepts responsibility for such service or
at any point prior thereto, which interference impedes Landlord in furnishing
plumbing, HVAC, electrical, sanitary, life safety, elevator, telecommunications,
or other Building services, utilities, or the Systems and Equipment. None of the
same shall be deemed an eviction or disturbance of Tenant’s use and possession
of the Premises or any part thereof, shall render Landlord liable to Tenant for
abatement of Rent, or shall relieve Tenant from performance of Tenant’s
obligations under this Lease. Landlord in no event shall be liable for damages
by reason of loss of profits, business interruption, or other compensatory or
consequential damages.

8.8 SAFETY AND SECURITY DEVICES, SERVICES, AND PROGRAMS. The parties acknowledge
that safety and security devices, services, and programs provided by Landlord,
if any, while intended to deter crime and ensure safety, may not in given
instances prevent theft or other criminal acts or ensure safety of persons or
property, and such devices, services and programs shall not under any
circumstances be deemed to be a guaranty, representation, or warranty by
Landlord to Tenant or any third parties as to the safety or protection of person
or property. The risk that any safety or security device, service, or program
may not be effective, or may malfunction, or be circumvented by a criminal, is
assumed by Tenant with respect to Tenant’s property and interests; and Tenant
shall obtain insurance coverage to the extent Tenant desires protection against
such criminal acts and other losses, as further described in Article 14. Tenant
agrees to cooperate in any reasonable safety or security program developed by
Landlord or required by Law.

9    TENANT’S CHANGES

9.1 TENANT’S REQUESTED CHANGES. Tenant may, subject to § 9.2 below, from time to
time during the Term of this Lease, at its expense, make such alterations,
additions, installations, substitutions, improvements, and decorations
(collectively “Tenant’s Changes”) in and to the Premises as Tenant may
reasonably consider necessary for the conduct of its business in the Premises
(except for changes which would require modification of the Property outside the
Premises), on the following conditions:

 

  (a) the outside appearance or the strength of the Building or of any of its
structural parts shall not be affected, and Tenant shall cause no penetration of
the roof or the exterior fabric of the Building;

 

  (b) no part of the Building outside of the Premises shall be physically
affected;

 

  (c) the proper functioning of any of the Systems and Equipment shall not be
adversely affected, and the usage of such systems by Tenant shall not be
increased;

 

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  (d) no such change shall require the addition of new INC riser cable or expand
the number of telephone pairs dedicated to the Premises by the Buildings’
telecommunications engineering design;

 

  (e) in performing the work involved in making such changes, Tenant shall be
bound by and observe all of the conditions and covenants contained in the
following sections of this Article 9; and

 

  (f) with respect to Tenant’s Changes, Tenant shall make all arrangements for,
and pay all expenses incurred in connection with, use of the freight elevators
servicing the Premises.

9.2 PLANS AND APPROVAL. Before proceeding with any Tenant’s Changes, Tenant
shall advise Landlord thereof and arrange a meeting with the Building Manager,
the Building Architect, and/or the Building Contractor, as required by Landlord
in relation to the scope of the proposed Changes. Except in extraordinary
circumstances which would reasonably require an exception, all work to be
performed in the Building shall be performed by the Building Contractor on the
basis of plans and drawings prepared by the Building Architect. If Landlord
grants permission for Tenant to utilize another contractor and/or architect for
its Changes, before proceeding with any Tenant’s Changes, Tenant shall submit to
Landlord plans and specifications and all changes and revisions thereto for the
work to be done for Landlord’s reasonable approval; and Tenant shall, upon
demand of Landlord, pay to Landlord the reasonable costs incurred and paid to
third parties by Landlord for the review of such plans and specifications and
all changes and revisions thereto by its architect, engineer, and other
consultants. Landlord may as a condition of its approval require Tenant to make
reasonable revisions in and to the plans and specifications. Landlord may
require Tenant to post a bond or other security reasonably satisfactory to
Landlord to insure the completion of such change. If Landlord consents to any
Tenant’s Changes or supervises the work of constructing any Tenant’s Changes,
such consent or supervision shall not be deemed a warranty as to the adequacy of
the design, workmanship, or quality of materials, and Landlord hereby expressly
disclaims any responsibility or liability for the same. Landlord shall under no
circumstances have any obligation to repair, maintain, or replace any portion of
such work.

9.2.1 As-Built Plans. Within thirty (30) days after completion of Tenant’s
Changes requiring the submission of plans to Landlord, Tenant shall furnish to
Landlord a complete set of “as-built” plans and specifications.

9.3 PERMITS AND PERFORMANCE. Tenant, at its expense, shall obtain all necessary
governmental permits and certificates for the commencement and prosecution of
Tenant’s Changes and for final approval thereof upon completion and shall
furnish copies thereof to Landlord. Tenant shall cause Tenant’s Changes to be
performed in compliance therewith and with all applicable Laws and requirements
of public authorities and with all applicable requirements of insurance bodies,
and in good and workmanlike manner, using new materials and equipment at least
equal in quality and class to the original installations in the Property.
Tenant’s Changes shall be performed in such manner as not unreasonably to
interfere with, delay, or impose any additional expense upon Landlord in the
renovation, maintenance, or operation of the Property or any portion thereof,
unless Tenant shall indemnify Landlord therefor to the latter’s reasonable
satisfaction.

9.4 CONTRACTORS. All electrical, mechanical, and plumbing work in connection
with Tenant’s Changes shall be performed by Landlord’s contractors at Tenant’s
expense. If Tenant shall request any electrical, mechanical, or plumbing work in
connection with Tenant’s Changes, Landlord shall request Landlord’s contractors
to furnish Tenant with prices to perform the same prior to prosecuting same. In
addition to the foregoing, and notwithstanding anything to the contrary in this
Article 9, Landlord may, at

 

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Landlord’s option, require that the work of constructing any Tenant’s Changes be
performed by Landlord’s contractor, in which case the cost of such work shall be
paid for before commencement of the work.

9.5 SUPERVISION AND FEE. Landlord may require that all work of constructing
Tenant’s Changes be performed under Landlord’s supervision. If Landlord does not
elect to require that Tenant use Landlord’s contractor, and if Tenant chooses to
use its own contractor for the work of constructing Tenant’s Changes, Tenant
shall pay to Landlord upon completion of any such work by Tenant’s contractor an
administrative fee of ten percent (10%) of the cost of the work, to cover
Landlord’s overhead in reviewing Tenant’s plans and specifications and
performing any supervision of the work of Tenant’s Changes. If Tenant chooses to
use Landlord’s contractor for such work, Tenant shall pay to Landlord upon
completion an administrative fee equal to five percent (5%) of the cost of the
work.

9.6 RESTORATION OF FIXTURES. If any of Tenant’s Changes shall involve the
removal of any fixtures, equipment, or other property in the Premises which are
not Tenant’s Property (as defined in Article 10), such fixtures, equipment, or
other property shall be promptly replaced, at Tenant’s expense, with new
fixtures, equipment, or other property (as the case may be) of like utility and
at least equal value, unless Landlord shall otherwise expressly consent in
writing; and Tenant shall, upon Landlord’s request, store and preserve, at
Tenant’s sole cost and expense, any such fixtures, equipment or property so
removed and shall return same to Landlord upon the expiration or sooner
termination of this Lease.

9.7 MECHANIC’S LIENS. Tenant shall keep the Property and Premises free from any
mechanic’s, materialman’s, or similar liens or other such encumbrances,
including the liens of any security interest in, conditional sales of, or
chattel mortgages upon, any materials, fixtures, or articles so installed in and
constituting part of the Premises, in connection with any Tenant’s Changes on or
respecting the Premises not performed by or at the request of Landlord and shall
indemnify, defend, protect, and hold Landlord harmless from and against any
claims, liabilities, judgements, or costs (including attorneys’ fees) arising
out of the same or in connection with any such lien, security interest,
conditional sale or chattel mortgage or any action or proceeding brought
thereon. Tenant shall give Landlord written notice at least twenty (20) days
prior to the commencement of work on any Tenant’s Change in the Premises (or
such additional time as may be necessary under applicable Laws), in order to
afford Landlord the opportunity of posting and recording appropriate notices of
nonresponsibility. Tenant shall remove any such lien or encumbrance by bond or
otherwise within thirty (30) days after written notice by Landlord; and if
Tenant shall fail to do so, Landlord may pay the amount necessary to remove such
lien or encumbrance, without being responsible for investigating the validity
thereof. The amount so paid shall be deemed Additional Rent under this Lease
payable upon demand, without limitation as to other remedies available to
Landlord under this Lease. Nothing contained in this Lease shall authorize
Tenant to do any act which shall subject Landlord’s title to the Property or
Premises to any liens or encumbrances, whether claimed by operation of law or
express or implied contract. Any claim to a lien or encumbrance upon the
Property or Premises arising in connection with any Work on or respecting the
Premises not performed by or at the request of Landlord shall be null and void,
or, at Landlord’s option, shall attach only against Tenant’s interest in the
Premises and shall in all respects be subordinate to Landlord’s title to the
Property and Premises.

9.8 NOTICES OF VIOLATION. Tenant, at its expense, and with diligence and
dispatch, shall procure the cancellation or discharge of all notices of
violation arising from or otherwise connected with Tenant’s Changes which shall
be issued by any governmental, public, or quasi-public authority having or
asserting jurisdiction. However, nothing herein contained shall prevent Tenant
from contesting, in good faith and at its own expense, any such notice of
violation, provided that Landlord’s rights hereunder are in no way compromised
or diminished thereby.

 

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9.9 INDUSTRIAL RELATIONS. Tenant agrees that the exercise of its rights pursuant
to the provisions of this Article 9 or any other provision of this Lease shall
not be done in a manner which would create any work stoppage, picketing, labor
disruption, or dispute or violate Landlord’s union contracts affecting the
Property and/or Complex or interfere with the business of Landlord or any Tenant
or occupant of the Building. Tenant shall, immediately upon notice from
Landlord, cease any activity, whether or not permitted by this Lease, giving
rise to such condition. If Tenant fails to do so, Landlord, in addition to any
rights available to it under this Lease and pursuant to Law, shall have the
right to an ex parte injunction without notice.

10    TENANT’S PROPERTY

10.1 FIXTURES AND IMPROVEMENTS. All fixtures, equipment, improvements,
alterations, and appurtenances attached to or built into the Premises at the
commencement of or during the Term of this Lease, including cabinets, sinks,
faucets, appliances, hot water heaters, etc. (collectively “Improvements”),
whether or not by or at the expense of Tenant, shall be and remain a part of the
Premises, shall be deemed the property of Landlord, and shall not be removed by
Tenant, except as expressly provided in Article 11 below.

10.2 TENANT’S PROPERTY AND TRADE FIXTURES. All movable partitions, trade
fixtures, office machinery and equipment, communications equipment, and computer
equipment (whether or not attached to or built into the Premises) which are
installed in the Premises by or for the account of Tenant, without expense to
Landlord and which can be removed without structural damage to the Property, and
all furniture, furnishings, and other articles of movable personal property
owned by Tenant and located in the Premises (collectively “Tenant’s Property”)
shall be and shall remain the property of Tenant and may be removed by it at any
time during the Term of this Lease; provided that if any of Tenant’s Property is
removed, Tenant or any party or person entitled to remove same shall repair or
pay the cost of repairing any damage to the Premises or to the Property
resulting from such removal. Any equipment or other property for which Landlord
shall have granted any allowance or credit to Tenant or which has replaced such
items originally provided by Landlord at Landlord’s expense shall not be deemed
to have been installed by or for the account of Tenant, without expense to
Landlord, and shall not be considered Tenant’s Property.

11     CONDITION UPON SURRENDER

11.1 CONDITION AND RESTORATION. At or before the Expiration Date or the date of
any earlier termination of this Lease, or as promptly as practicable using
Tenant’s best efforts after such an earlier termination date, Tenant, at its
expense, shall do all of the following:

 

  (a) surrender possession of the Premises in the condition required under §
12.1 below, ordinary wear and tear excepted;

 

  (b) surrender all keys, any key cards, and any parking stickers or cards to
Landlord and give Landlord in writing the combinations of any locks or vaults
then remaining in the Premises;

 

  (c) remove from the Premises all of Tenant’s Property, including any data
wiring and cabling that Tenant has installed, except such items thereof as
Tenant shall have expressly agreed in writing with Landlord were to remain and
to become the property of Landlord; and

 

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  (d) fully repair any damage to the Premises or the Property resulting from
such removal.

Tenant’s obligations herein shall survive the expiration or earlier termination
of the Lease, unless expressly provided to the contrary herein. All Improvements
and other items in or upon the Premises (except Tenant’s Property), whether
installed by Tenant or Landlord, shall be Landlord’s property and shall remain
upon the Premises, all without compensation, setoff, allowance, or credit to
Tenant; provided, however, that if prior to such expiration or earlier
termination Landlord so directs by notice, Tenant shall promptly remove such of
the Improvements in the Premises as are designated in such notice and shall
restore the Premises to their condition prior to the installation of such
Improvements. Notwithstanding the foregoing, Landlord shall not require removal
of improvements installed pursuant to the Work Letter Agreement, if any (except
as expressly provided to the contrary therein), or installed by Tenant with
Landlord’s written approval (except as expressly required by Landlord in
connection with granting such approval).

11.2 TENANT’S FAILURE TO REMOVE OR RESTORE. If Tenant shall fail to perform any
repairs or restoration or fail to remove any items from the Premises as required
under this Article 11, Landlord may do so, and Tenant shall pay Landlord the
cost thereof upon demand. All property removed from the Premises by Landlord
pursuant to any provisions of this Lease or any Law may be handled or stored by
Landlord at Tenant’s expense, and Landlord shall in no event be responsible for
the value, preservation, or safekeeping thereof. All property not removed from
the Premises or retaken from storage by Tenant within thirty (30) days after
expiration or earlier termination of this Lease or Tenant’s right to possession
shall at Landlord’s option be conclusively deemed to have been conveyed by
Tenant to Landlord as if by bill of sale without payment by Landlord. Unless
prohibited by applicable Laws, Landlord shall have a lien against such property
for the costs incurred in removing and storing the same.

12    REPAIRS AND MAINTENANCE

12.1 TENANT’S CARE OF PREMISES. Except for customary cleaning and trash removal
provided by Landlord under § 8.1 above and damage covered under Article 15,
Tenant shall keep the Premises in good and sanitary condition, working order,
and repair, including carpet, wall-covering, doors pertinent to and within the
Premises, plumbing, all telecommunications cables and wiring within Tenant’s
Premises (“IW”) from the interface of such IW with the INC, and other fixtures,
equipment, alterations, and improvements, whether installed by Landlord or
Tenant. In addition, Tenant, at its expense, shall promptly make all repairs,
ordinary or extraordinary, interior or exterior, structural or otherwise, in and
about the Premises and the Property, as shall be required by reason of (a) the
performance or existence of Tenant’s Work or Tenant’s Changes; (b) the
installation, use, or operation of Tenant’s Property in the Premises; (c) the
moving of Tenant’s Property in or out of the Building; or (d) the misuse or
neglect of Tenant or any of its employees, agents, or contractors. Tenant, at
its expense, shall replace all scratched, damaged, or broken doors or other
glass in or about the Premises and shall be responsible for all repairs,
maintenance, and replacement of wall and floor coverings in the Premises and for
the repair and maintenance of all lighting fixtures therein. All repairs except
for emergency repairs made by Tenant as provided herein shall be performed by
contractors or subcontractors approved in writing by Landlord prior to
commencement of such repairs, which approval shall not be unreasonably withheld
or delayed. If Tenant does not promptly make such arrangements, Landlord may,
but need not, make such repairs, maintenance, and replacements, and the costs
paid or incurred by Landlord therefor shall be reimbursed by Tenant promptly
after request by Landlord.

12.2 LANDLORD’S CARE OF PROPERTY. Landlord, at its expense, shall keep and
maintain the common areas of the Property and the Systems and Equipment serving
the Premises in good working order, condition, and repair and shall make all
repairs, structural and otherwise, interior and exterior, as and

 

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when needed in or about the Premises, except for those repairs for which Tenant
is responsible pursuant to § 12.1 above or any other provisions of this Lease.
Landlord shall maintain and repair all INC in the Building, and Tenant shall
have no right to make repairs to INC. The cost of Landlord’s maintenance and
repairs pursuant to this Article 12 shall be reimbursed to Landlord to the
extent provided in Article 4 above.

12.3 WAIVER BY TENANT. Tenant waives the benefits of any statute now or
hereafter in effect which would otherwise afford Tenant the right to make
repairs at Landlord’s expense or to terminate this Lease because of Landlord’s
failure to keep the Premises in good order, condition, and repair.

13    RULES AND REGULATIONS

13.1 OBSERVANCE AND MODIFICATION. Tenant and its employees and agents shall
faithfully observe and comply with the Rules and Regulations attached hereto as
Exhibit C (the “Rules”) and such reasonable changes therein (whether by
modification, elimination, or addition) as Landlord at any time or times
hereafter may make and communicate in writing to Tenant, so long as such changes
do not unreasonably affect the conduct of Tenant’s business in the Premises,
except as required by any applicable Law; provided, however, that in case of any
conflict or inconsistency between the provisions of this Lease and any of the
Rules as originally promulgated or as changed, the provisions of this Lease
shall control.

13.2 APPLICATION TO TENANT. Nothing in this Lease shall be construed to impose
upon Landlord any obligation to Tenant to enforce the Rules or the terms,
covenants, or conditions in any other lease, as against any other tenant, and
Landlord shall not be liable to Tenant for violation of the same by any other
tenant or its employees, agents, or visitors.

14    INSURANCE AND INDEMNIFICATION

14.1 TENANT’S INSURANCE. Tenant shall obtain and maintain in effect at all times
during Tenant’s possession of the Premises the following insurance coverages and
policies:

14.1.1 Liability Insurance. Tenant shall maintain a policy of commercial general
liability insurance, which shall include coverages for (a) personal injury;
(b) contractual liability; and (c) property damage liability. The minimum limits
of liability shall be a combined single limit with respect to each occurrence of
not less than Two Million Dollars ($2,000,000) and an aggregate limit of not
less than Three Million Dollars ($3,000,000). The policy shall contain a
cross-liability endorsement and a severability of interest clause. Tenant shall
increase the insurance coverage as required by Landlord’s lender or if
Landlord’s insurance consultant believes that the coverage is not adequate.

14.1.2 Tenant’s Business Personal Property Insurance. Tenant shall maintain on
all of its business personal property, including valuable business papers and
accounts receivable; operating supplies; inventory; and furniture, fixtures, and
equipment (whether owned, leased, or rented) (collectively “Business Personal
Property”) a “special perils” property damage insurance policy including
coverage for sprinkler leakage and containing an agreed amount endorsement (or,
if applicable, a business owner’s policy with a no-coinsurance provision) in an
amount not less than one hundred percent (100%) of the full replacement cost
valuation of such Business Personal Property. The proceeds from any such policy
shall be used by Tenant for the replacement of such Business Personal property.

 

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14.1.3 Workers’ Compensation Insurance. Tenant shall maintain workers’
compensation insurance as required by law and employer’s liability insurance in
an amount not less than Five Hundred Thousand Dollars ($500,000).

14.1.4 Business Interruption/Extra Expense Insurance. Tenant shall maintain
business interruption or (if applicable) contingent business interruption and
extra expense insurance in such amounts as will reimburse Tenant for direct or
indirect loss of earnings and incurred costs attributable to the perils commonly
covered by Tenant’s property insurance described in § 14.1.2 above. Such
insurance will be carried with the same insurer that issues the insurance for
Tenant’s Business Personal Property pursuant to § 14.1.2 above.

14.1.5 Other Coverage. Tenant, at its cost, shall maintain such other insurance
as Landlord may reasonably require from time to time, but in no event may
Landlord require any other insurance which is not then available at commercially
reasonable rates.

14.2 TENANT’S INSURANCE CRITERIA. All insurance required to be maintained by
Tenant under this Lease shall conform to the following criteria:

(i) Tenant’s insurance shall be issued by insurance companies authorized to do
business in the State of California with a financial rating of at least A:XIII
for any property insurance and at least A-:IX for any liability insurance, as
rated in the most recent edition of Best’s Insurance Reports;

(ii) Tenant’s insurance shall be issued as primary;

(iii) Tenant’s liability and property insurance policies shall name Tenant as
the insured and Landlord, Landlord’s agents, and any Lessors and Holders (as
such terms are defined in § 18.1 below) whose names shall have been furnished to
Tenant as additional insureds;

(iv) Tenant’s insurance shall contain an endorsement requiring at least thirty
(30) days’ written notice from the insurance company to each insured and
additional insured before cancellation of any coverage or policy; and

(v) with respect to damage to or loss of Tenant’s Business Personal Property, a
waiver of subrogation must be obtained, as required under § 14.4 below.

14.2.1 Blanket Coverage. All of the insurance requirements set forth herein on
the part of Tenant to be observed shall be deemed satisfied if the Premises are
covered by a blanket insurance policy complying with the limits, requirements,
and criteria contained in this Article 14 insuring all or most of Tenant’s
facilities in California.

14.2.2 Evidence of Coverage. A certificate of insurance shall be deposited with
Landlord at the commencement of the Term or, if earlier, upon Tenant’s taking
possession of the Premises; and on renewal of the policy a certificate of
insurance listing the insurance coverages required hereunder and naming the
appropriate additional insureds shall be deposited with Landlord not less than
seven (7) days before expiration of the policy.

14.3 LANDLORD’S INSURANCE. Landlord shall maintain “all risk” property damage
insurance containing an agreed amount endorsement covering not less than one
hundred percent (100%) of the full insurable replacement cost valuation of
(y) the Building and the tenant improvements, betterments, and the alterations
thereto; and (z) Landlord’s personal property, business papers, furniture,
fixtures, and equipment (collectively “Landlord’s Property”), exclusive of the
costs of excavation, foundations and footings, and risks required to be covered
by Tenant’s insurance, and subject to commercially reasonable

 

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deductibles. Landlord shall also obtain and keep in full force the following
policies of insurance: (a) commercial general liability insurance; (b) loss of
rent insurance (also known as rent continuation insurance); (c) workers’
compensation insurance, if required by applicable Law; and (d) such other
insurance as Landlord deems appropriate or as may be required by any Holder or
Lessor.

14.4 RELEASES AND WAIVERS OF SUBROGATION. The purpose of this provision is to
allow Landlord and Tenant to allocate and assume certain risks to coincide with
insurance coverages required to be maintained pursuant to the terms to this
Lease. Landlord and Tenant recognize the benefit that each will receive from the
waivers of subrogation each is required to obtain pursuant to this § 14.4 and
that there are significant advantages to each in connection with minimizing
duplication of insurance coverages. Accordingly, Landlord and Tenant agree to
accept and place the limitations which follow on each other’s respective
liabilities and responsibility for damages in order to coincide with required
insurance coverages.

14.4.1 Tenant’s Property Agreement. In light of Tenant’s agreement to insure
Tenant’s Business Personal Property in accordance with § 14.1.2 above, Tenant
agrees that Landlord will have no liability to Tenant in the event Landlord
damages or destroys, negligently or otherwise, all or any part of Tenant’s
Business Personal Property. Tenant will cause to be placed in its insurance
policies covering Tenant’s Business Personal Property a waiver of subrogation so
that its insurance company will not become subrogated to Tenant’s rights and
will not be able to proceed against Landlord in connection with any such damage
or destruction.

14.4.2 Landlord’s Property Agreement. In light of Landlord’s agreement to insure
Landlord’s Property in accordance with § 14.3 above, Landlord agrees that Tenant
will have no liability to Landlord in the event that Tenant damages or destroys,
negligently or otherwise, all or any part of Landlord’s Property. Landlord will
cause to be placed in its insurance policies covering Landlord’s Property a
waiver of subrogation so that its insurance company will not become subrogated
to Landlord’s rights and will not be able to proceed against Tenant in
connection with any such damage or destruction.

14.4.3 Tenant’s Release. Landlord shall not be responsible or liable to Tenant
for any damages or destruction to Tenant’s Business Personal Property caused by
Landlord’s employees, agents, visitors, invitees, guests, or independent
contractors (collectively “Landlord’s Associates”), and Tenant hereby releases
Landlord from any claims, liabilities, demands, losses, damages, consequential
damages, and the like, including reasonable attorneys’ fees and court costs
(collectively “Claims”) resulting from damage or destruction to Tenant’s
Business Personal Property caused directly or indirectly by Landlord and/or
Landlord’s Associates; provided, however, that nothing herein shall be deemed to
release Landlord’s independent contractors from any such Claims Tenant may have
against Landlord’s independent contractors.

14.4.4 Landlord’s Release. Tenant shall not be responsible or liable to Landlord
for any damages or destruction to Landlord’s Property caused by Tenant’s
employees, agents, visitors, invitees, guests, or independent contractors
(collectively “Tenant’s Associates”), and Landlord hereby releases Tenant from
any Claims resulting from damage or destruction to Landlord’s Property caused
directly or indirectly by Tenant and/or Tenant’s Associates; provided, however,
that nothing herein shall be deemed to release Tenant’s independent contractors
from any such Claims Landlord may have against Tenant’s independent contractors.

14.4.5 Damage to Business and Loss of Rents. In light of Landlord’s agreement to
carry continuation of rent insurance pursuant to § 14.3 above and Tenant’s
agreement to carry business interruption insurance (extra expense insurance) in
accordance with § 14.1.4 above, in the event that

 

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Landlord’s Property is damaged or destroyed because of any act or conduct,
negligent or otherwise, by Tenant and/or by Tenant’s Associates, Landlord shall
have no rights against Tenant by virtue of such damage or destruction, and
Landlord hereby releases Tenant from all Claims, including claims for loss of
rent, by Landlord directly or indirectly resulting from the damage or
destruction of Landlord’s Property by conduct by Tenant and/or by Tenant’s
Associates. Likewise, in the event that Tenant’s Business Personal Property is
damaged or destroyed because of any act or conduct, negligent or otherwise, by
Landlord and/or by Landlord’s Associates, Tenant shall have no rights against
Landlord by virtue of such damage or destruction, and Tenant hereby releases
Landlord from all Claims by Tenant directly or indirectly resulting from the
damage or destruction to Tenant’s Business Personal Property by the conduct of
Landlord and/or Landlord’s Associates, including Claims for loss of business or
loss of profits. Notwithstanding the foregoing, nothing herein shall be deemed
to release Tenant’s or Landlord’s independent contractors from any liability to
Tenant and/or Landlord.

14.4.6 Injury and Death to Individuals. Landlord and Tenant understand that
waivers of subrogation do not apply to injury to and death of individuals.
Landlord and Tenant shall each carry insurance, as provided by this Article 14,
in connection with injury and death to individuals. Landlord hereby agrees to
indemnify and hold Tenant harmless from any Claims which Tenant may otherwise
have with respect to injury or death to individuals occurring within the
Property but outside the Premises, except to the extent that such injury or
death is caused by Tenant and/or Tenant’s Associates, through negligence or
otherwise, and is not covered by the insurance Landlord is required to carry
under this Lease. Likewise, Tenant agrees to indemnify, defend, protect, and
hold Landlord harmless from any Claims for injury or death to persons occurring
within the Premises or caused, directly or indirectly, by Tenant or Tenant’s
Associates outside the Premises, except to the extent such injuries or death are
caused by Landlord and/or Landlord’s Associates, through negligence or
otherwise, and are not covered by the insurance Tenant is required to carry
under this Lease.

14.4.7 Abatement of Rent. Except as may be expressly provided elsewhere in this
Lease, Tenant shall not be entitled to Rent abatement and shall not otherwise
have, and hereby releases Landlord from, any Claims resulting from Tenant’s
inability to utilize all or any part of the Premises, except to the extent that
Tenant is unable to use all or any part of the Premises and does not use all or
any part of the Premises as a result of Landlord’s intentional decision to
refuse to provide access to the Building and/or the Premises and/or to provide
services and/or utilities to Tenant as required to be provided by Landlord to
Tenant pursuant to this Lease, where such refusal is not caused by a Force
Majeure occurrence.

14.4.8 Availability of Waiver of Subrogation. If an insurance policy cannot be
obtained with a waiver of subrogation or is obtainable only by the payment of an
additional premium charge above that charged by insurance companies issuing
policies without waiver of subrogation, the party undertaking to obtain the
insurance shall notify the other party of this fact. The other party shall have
a period of ten (10) days after receiving the notice either to place the
insurance with a company that is reasonably satisfactory to the other party and
that will carry the insurance with a waiver of subrogation at no additional cost
or to agree to pay the additional premium if such a policy is obtainable at
additional cost. If the insurance cannot be obtained or the party in whose favor
a waiver of subrogation is desired refuses to pay the additional premium
charged, the other party is relieved of the obligation to obtain a waiver of
subrogation with respect to the particular insurance involved.

14.5 OTHER CASES OF DAMAGE OR INJURY. In all cases not covered by the foregoing
provisions of this Article 14, Tenant hereby assumes all risk of damage to
property or injury to persons in, upon, or about

 

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the Premises from any cause other than the active negligence or intentional
misconduct of Landlord and its agent or employees. Without limiting the
generality of the foregoing, Landlord shall not be liable for injury or damage
which may be sustained by the person, goods, wares, merchandise, or property of
Tenant or Tenant’s Associates or any other person in or about the Premises
caused by or resulting from fire, steam, electricity, gas, water or rain, which
may leak or flow from or into any part of the Premises, or from the breakage,
leakage, obstruction, or other defects of the Systems and Equipment, pipes,
sprinklers, wires, INC. appliances, plumbing, heating, air-conditioning, or
lighting fixtures of the same, whether the damage or injury results from
conditions arising upon the Premises or upon other portions of the Property, the
Complex, or from other sources. Landlord shall not be liable for any damages
arising from any act or omission of any other tenant or occupant of the Property
or Complex. In all cases not covered by the foregoing provisions of this Article
14, Tenant shall indemnify, defend, protect, and hold Landlord harmless against
(a) any and all Claims arising from any death or injury to any person or damage
to any property whatsoever occurring in, on, or about the Premises or any part
thereof, and (b) any and all Claims occurring in, on or about any of the Common
Areas, the Property, or the Complex, when such injury or damage is caused in
whole or in part by the act, negligence, fault, or omission of any duty with
respect to the same by Tenant or Tenant’s Associates. In all cases not covered
by the foregoing provisions of this-Article 14, Tenant shall further indemnify,
defend, protect, and hold Landlord harmless from and against any and all Claims
arising from any breach or default in the performance of any obligation on
Tenant’s part to be performed under this Lease, or arising from any act or
negligence of Tenant or Tenant’s Associates, and from and against all costs,
attorneys’ fees, expenses, and liabilities incurred in connection with any such
Claim or any action or proceeding brought thereon. In case any action or
proceeding be brought against Landlord by reason of any such Claim, Tenant, upon
notice from Landlord, shall defend the same at Tenant’s expense by counsel
reasonably satisfactory to Landlord; provided, however, that Tenant shall not be
liable in any case for damage to property or death or injury to person(s)
occasioned by the active negligence or intentional misconduct of Landlord or
Landlord’s Associates, unless covered by insurance Tenant is required to
provide.

15    DAMAGE OR DESTRUCTION

15.1 LOSS COVERED BY INSURANCE. If at any time prior to the expiration or
termination of this Lease the Premises or the Property is wholly or partially
damaged or destroyed by any casualty which results in a loss to Landlord that is
fully covered by insurance maintained by Landlord or for Landlord’s benefit (or
required to be maintained by Landlord pursuant to § 14.3 above), which casualty
renders the Premises totally or partially inaccessible or unusable by Tenant in
the ordinary conduct of Tenant’s business, the parties agree that the following
provisions shall modify their obligations under this Lease after such damage or
destruction.

15.1.1 Repairs Which Can Be Completed Within Six (6) Months. Within thirty
(30) days after Tenant’s written notice to Landlord of such damage or
destruction, Landlord shall provide Tenant with notice of its determination of
whether the damage or destruction can be repaired within six (6) months after
the commencement of the work of repairing such damage or destruction without the
payment of overtime or other premiums. If all repairs to Premises or Property
can, in Landlord’s judgement, be completed within six (6) months following the
date of the commencement of the work of repairing such damage or destruction
without the payment of overtime or other premiums, Landlord shall, at Landlord’s
expense, repair the same; and this Lease shall remain in full force and effect,
except that a proportionate reduction of the Rent shall be allowed Tenant to the
extent that the Premises shall be rendered inaccessible or unusable by Tenant
and are not used by Tenant during the period of time that such portion is
unusable or inaccessible and not used by Tenant.

 

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15.1.2 Repairs Which Cannot Be Completed Within Six (6) Months. If all such
repairs to the Property and Premises cannot, in Landlord’s judgement, be
completed within six (6) months following the commencement of the work of
repairing such damage or destruction without the payment of overtime or other
premiums, Landlord shall notify Tenant of such determination; and in such an
event, either Landlord or Tenant may, at its option, upon written notice to the
other party given within sixty (60) days after the occurrence of such damage or
destruction, elect to terminate this Lease as of the date of the occurrence of
such damage or destruction. In the event that neither Landlord nor Tenant elects
to terminate the Lease in accordance with the foregoing provisions, then
Landlord shall, at Landlord’s expense, repair such damage or destruction; and in
such event, this Lease shall continue in full force and effect, except that the
Rent shall be proportionately reduced as provided in § 15.1.1 above; provided,
however, that if any such repair is not commenced by Landlord within ninety
(90) days after the occurrence of such damage or destruction or is not
substantially completed by Landlord within nine (9) months after the occurrence
of such damage or destruction, then in either such event Tenant may, at its
option, upon written notice to Landlord, elect to terminate this Lease as of the
date of Landlord’s receipt of such notice. Notwithstanding the foregoing, Tenant
shall have no right to terminate this Lease in the situation just described if
all of the following conditions, are met: (x) Landlord shall have informed
Tenant in its notice of determination that the repair of such damage or
destruction could not be substantially completed by Landlord within nine
(9) months after the occurrence of such damage or destruction; (y) Tenant shall
not have elected to terminate the Lease by written notice delivered to Landlord
within sixty (60) days after the occurrence of such damage or destruction; and
(z) Landlord shall have commenced the work of repairing such damage or
destruction.

15.2 LOSS NOT COVERED BY INSURANCE. If at any time prior to the expiration or
earlier termination of this Lease the Premises or the Property is totally or
partially damaged or destroyed in connection with a casualty, which loss to
Landlord is not fully covered by insurance maintained by Landlord or for
Landlord’s benefit (or required to be maintained by Landlord pursuant to § 14.3
above); and if such damage renders the Premises inaccessible or unusable to
Tenant for their intended purpose in the ordinary course of its business,
Landlord may, at its option, upon written notice given to Tenant within sixty
(60) days after Tenant’s written notice to Landlord of the occurrence of such
damage or destruction, either (a) elect to repair or to restore such damage or
destruction or (b) elect to terminate this Lease. If Landlord elects to repair
or restore such damage or destruction, this Lease shall continue in full force
and effect, except that the Rent shall be proportionately reduced as provided in
§ 15.1.1 above. If Landlord does not elect by notice to Tenant to repair such
damage, the Lease shall terminate as of the date of Tenant’s receipt of
Landlord’s notice of election to terminate. Notwithstanding the foregoing, if
all repairs to the Premises or the Building cannot, in Landlord’s reasonable
judgement, be completed within six (6) months following the date of the
commencement of the work of repairing such damage or destruction without the
payment of overtime or other premiums, then either Landlord or Tenant may at the
option of either, upon written notice to the other party given within sixty
(60) days after the occurrence of such damage or destruction, elect to terminate
this Lease as of the date of such notice.

15.3 DESTRUCTION DURING FINAL YEAR. Notwithstanding anything to the contrary
contained in §§ 15.1 and l5.2, if the Premises or the Building are wholly or
partially damaged or destroyed within the final twelve (12) months of the Term
of this Lease or, if an applicable renewal option has been exercised, during the
last year of any renewal term, in such a way that Tenant shall be prevented from
using the Premises for at least thirty (30) consecutive days as a result of such
damage or destruction, then either Landlord or Tenant may, at the option of
either, by written notice to the other party delivered within sixty (60) days
after the occurrence of such damage or destruction, elect to terminate the Lease
as of the date of such notice.

 

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15.4 DESTRUCTION OF TENANT’S PROPERTY. Under no circumstances shall Landlord be
required to repair any injury or damage to, or make any repairs to or
replacements of, Tenant’s Property. However, as part of Operating Expenses,
Landlord shall cause to be insured the Improvements in the Premises which do not
consist of Tenant’s Property and shall cause such Improvements to be repaired
and restored at Landlord’s sole expense, except that Tenant shall pay any
applicable deductible. Landlord shall have no responsibility for any contents
placed or kept in or on the Premises or the Property by Tenant or Tenant’s
employees or invitees or any other person claiming through Tenant.

15.5 EXCLUSIVE REMEDY. Landlord and Tenant agree that their respective rights
and obligations in the event of any damage or destruction of the Premises,
Property, or Complex shall be governed exclusively by this Lease. Tenant, as a
material inducement to Landlord entering into this Lease, irrevocably waives and
releases Tenant’s rights under California Civil Code §§ 1932(2), 1933(4), and
1942, as the same may be modified or replaced hereafter. No damages,
compensation, setoff, allowance, or claim shall be payable by Landlord for any
inconvenience, interruption, or cessation of Tenant’s business or any annoyance
arising from any damage to or destruction of all or any portion of the Premises,
Property, or Complex.

16    EMINENT DOMAIN

16.1 CONDEMNATION. If the whole or any material part of the Premises or Property
shall be taken by power of eminent domain or condemned by any competent
authority for any public or quasi-public use or purpose; or if any adjacent
property or street shall be so taken, condemned, reconfigured, or vacated by
such authority in such manner as to require the use, reconstruction, or
remodeling of any part of the Premises or Property; or if Landlord shall grant a
deed or other instrument in lieu of such taking by eminent domain or
condemnation (collectively “Takings”), Landlord shall have the option to
terminate this Lease upon ninety (90) days’ notice, provided such notice is
given no later than one hundred and eighty (180) days after the date of such
Taking. Tenant shall have reciprocal termination rights, on the same terms and
conditions and to be exercised in the same manner as the foregoing sentence
provides, if the whole or any material part of the Premises is permanently
taken, or if access to the Premises is permanently materially impaired.

16.2 RENTAL APPORTIONMENT. All Rent shall be apportioned as of the date of such
termination or the date of such Taking, whichever shall first occur. If any part
of the Premises shall be taken, and this. Lease shall not be so terminated, the
Rent shall be proportionately abated.

16.3 AWARDS AND DAMAGES. Landlord shall be entitled to receive the entire award
or payment in connection with any Taking, except that Tenant shall have the
right to file any separate claim available to Tenant for any taking of Tenant’s
personal property and fixtures belonging to Tenant and removable by Tenant upon
expiration of the Term, and for moving expenses, so long as such claim does not
diminish the award available to Landlord and such claim is payable separately to
Tenant.

16.4 TEMPORARY CONDEMNATION. If part or all of the Premises are condemned for a
limited period of time (“Temporary Condemnation”), this Lease shall remain in
effect. The Rent and Tenant’s obligations for the part of the Premises taken
shall abate during the Temporary Condemnation in proportion to the part of the
Premises that Tenant is unable to use in its business operations as a result of
the Temporary Condemnation. Landlord shall receive the entire award for any
Temporary Condemnation.

17    ASSIGNMENT AND SUBLETTING

17.1 CONSENT REQUIRED FOR TRANSFER. Tenant agrees that it shall not assign,
sublet, mortgage, hypothecate, or encumber this Lease, nor permit or allow the
Premises or any part thereof to be used or occupied by others, without the prior
written consent of Landlord in each instance. The actions described

 

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in the foregoing sentence are referred to collectively herein as “Transfers” and
individually as a “Transfer.” If the Premises or any part thereof be sublet or
occupied by anybody other than Tenant, Landlord may, after default by Tenant,
collect rent from the subtenant or occupant and apply the net amount collected
to the Rent herein reserved; but no Transfer, occupancy, or collection shall be
deemed a waiver of the provisions hereof, the acceptance of the subtenant or
occupant as tenant, or a release of Tenant from the further performance
hereunder by Tenant. The consent by Landlord to a Transfer shall not relieve
Tenant from obtaining the Landlord’s express written consent to any further
Transfer. In no event shall any permitted sublessee assign or encumber its
sublease or further sublet all or any portion of its sublet space, or otherwise
suffer or permit the sublet space or any part thereof to be used or occupied by
others, without Landlord’s prior written consent in each instance.

17.1.1 Corporate Transferor. If Tenant is a corporation, the provisions of §
17.1 shall apply to a transfer (by one or more transfers) of a majority of the
stock of Tenant as if such transfer of a majority of the stock of Tenant were an
assignment of this Lease (but subject to the limitations and provisions of §
17.13 below).

17.2 NOTICE OF INTENT TO TRANSFER. If Tenant shall at any time or times during
the Term of this Lease desire to assign this Lease or sublet all or part of the
Premises, Tenant shall give notice thereof (the “Transfer Notice”) to Landlord,
which notice shall set forth all of the following:

 

  (a) the proposed terms of the assignment or subletting, including (i) the
effective or commencement date thereof, which shall be not less than thirty
(30) nor more than one hundred eighty (180) days after the giving of such
notice; (ii) in the case of a proposed assignment, the consideration therefor;
and (iii) in the case of a proposed subletting, the rental rate to be paid by
the proposed subtenant (including any escalation or Additional Rent payable),
the term of the proposed sublease (including any renewal options), any work to
be performed or paid for by Tenant, the amount of any security deposit, the cost
and extent of any so-called “take-over” obligations to be assumed by Tenant on
behalf of such subtenant, the amount of any rent concessions to be granted by
Tenant, and any other additional monetary or so-called “business” terms or
conditions;

 

  (b) a statement setting forth in reasonable detail the identity of the
proposed assignee or subtenant, the nature of its business, and its proposed use
of the Premises; and

 

  (c) current financial information with respect to the proposed assignee or
subtenant, including its most recent financial report, and any other information
which may reasonably be required by Landlord.

17.3 LANDLORD’S RECAPTURE RIGHT. The Transfer Notice shall be deemed an offer
from Tenant to Landlord whereby Landlord (or Landlord’s designee) may, at its
option, terminate this Lease as to all or the affected portion of the Premises
(as the case may be) as of the effective date of the proposed Transfer. Landlord
may exercise its recapture right by notice to Tenant at any time within thirty
(30) days after Landlord’s receipt of Tenant’s Transfer Notice; and during such
thirty-day period Tenant shall not assign this Lease nor sublet such space to
any person.

17.3.1 Date of Termination. If Landlord exercises its option to terminate this
Lease as provided in § 17.3 above, this Lease shall end and expire on the date
that such Transfer was to be effective or commence, as the case may be, and the
Base Rent and Additional Rent shall be paid and apportioned to such date.

 

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17.4 CONDITIONS OF CONSENT. If Landlord does not exercise its recapture right
pursuant to § 17.3 above, and providing that Tenant is not in default of any of
Tenant’s obligations under this Lease after notice and the expiration of any
applicable grace period, Landlord’s consent (which must be in writing and in
form reasonably satisfactory to Landlord) to the proposed assignment or sublease
shall not be unreasonably withheld or delayed, provided the following conditions
are met:

 

  (a) Tenant shall have complied with the provisions of § 17.2 above, and
Landlord shall not have exercised its recapture right pursuant to § 17.3 above
within the time permitted therefor;

 

  (b) In Landlord’s reasonable judgement the proposed assignee or subtenant is
engaged in a business which would use the Premises, or the relevant part
thereof, in a manner which is in keeping with the then-current standards of the
Building, is limited to the use expressly permitted under this Lease, and will
not violate any negative covenant or other restriction or agreement as to use
contained in any other lease of space in the Complex;

 

  (c) The proposed assignee or subtenant is a reputable entity or person of good
character and with reasonably sufficient financial worth considering the
responsibility involved (and in no event of less financial standing than
Tenant), is not subject to any toxic or hazardous materials cleanup order with
respect to any other property, and Landlord has been furnished with reasonable
proof thereof;

 

  (d) Neither the proposed assignee or sublessee nor any person which, directly
or indirectly, controls, is controlled by, or is under common control with, the
proposed assignee or sublessee or any person who controls the proposed assignee
or sublessee, is then an occupant of any part of the Complex, provided Landlord
then has suitable space in the Complex available for leasing. For purposes of
this Lease control shall be deemed to mean ownership of more than fifty percent
(50%) of all the voting stock of a corporation or more than fifty percent
(50%) of all the legal and equitable interest in any other business entity;

 

  (e) The proposed assignee or sublessee is not a person or entity with whom
Landlord is then negotiating to lease space in the Building;

 

  (f) The form of the proposed lease shall be in form reasonably satisfactory to
Landlord and shall comply with the applicable provisions of this Article 17;

 

  (g) There shall not be more than two (2) subtenants (not including the
Permitted Occupant (as defined in § 17.14 below) of the Premises);

 

  (h) The amount of the aggregate rent to be paid by the proposed subtenant is
not less than the then-current market rent per rentable square foot for
comparable space in the Complex, as though the Premises were vacant, and the
rental and other terms and conditions of the sublease are the same as those
contained in the proposed sublease furnished to Landlord in the Transfer Notice
pursuant to § 17.2 above;

 

  (i) Tenant shall reimburse Landlord on demand for any reasonable costs that
may be incurred or paid by Landlord to third persons in connection with said
assignment or sublease, including costs of making investigations as to the
acceptability of the proposed assignee or subtenant and legal costs incurred in
connection with the granting of any requested consent; and

 

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  (j) Tenant shall not have advertised or publicized in any way the availability
of the Premises without prior notice to and approval by Landlord, nor shall any
advertisement state the name (as distinguished from the address) of the Complex
or the rental rate;

 

  (k) Tenant shall not have listed the Premises for subletting or assignment at
a rental rate less than the greater of (i) the Base Rent and Additional Rent
then payable hereunder for such space or (ii) the Base Rent and Additional Rent
at which Landlord is then offering to lease other comparable space in the
Building; and

 

  (1) The sublease shall not allow the use of the Premises or any part thereof
for (i) the sale of food for on or off-premises consumption or (ii) use by a
foreign or domestic governmental agency.

Whether or not Landlord shall grant consent, Tenant shall pay $500.00 towards
Landlord’s review and processing expenses in connection with any Transfer
request, as well as any reasonable legal fees incurred by Landlord, within
thirty (30) days after written request by Landlord.

17.5 CONTINUATION OF LEASE TERMS. Each subletting pursuant to this Article 17
shall be subject to all of the covenants, agreements, terms, provisions, and
conditions contained in this Lease. Notwithstanding any such subletting to any
other subtenant and/or acceptance of Rent by Landlord from any subtenant, Tenant
shall remain liable for the payment of the Base Rent and Additional Rent due and
to become due hereunder and for the performance of all the covenants,
agreements, terms, provisions, and conditions contained in this Lease on the
part of Tenant to be performed and all acts and omissions of any licensee or
subtenant or anyone claiming under or through any subtenant which shall be in
violation of any of the obligations of this Lease; and any such violation shall
be deemed to be a violation by Tenant. Tenant further agrees that
notwithstanding any such subletting, no other and further subletting of the
Premises by Tenant or any person or entity claiming through or under Tenant
shall or will be made except upon compliance with and subject to the provisions
of this Article 17. If Landlord shall decline to give its consent to any
proposed assignment or sublease, or if Landlord shall exercise its recapture
right under § 17.3 above, Tenant shall indemnify, defend, protect, and hold
Landlord harmless against and from any and all Claims resulting from any Claims
that may be made against Landlord by the proposed assignee or sublessee or by
any brokers or other persons claiming a commission or similar compensation in
connection with the proposed assignment or sublease.

17.6 LAPSE OF CONSENT. In the event that Landlord consents to a proposed
Transfer described in the Transfer Notice and Tenant fails to execute and
deliver the assignment or sublease described in the Transfer Notice to which
Landlord consented within one hundred twenty (120) days after the giving of such
consent, then Tenant shall again comply with all of the provisions and
conditions of § 17.2 above before assigning this Lease or subletting all or part
of the Premises.

17.7 TRANSFER DOCUMENTATION. With respect to each and every Transfer authorized
by Landlord under the provisions of this Lease, it is further agreed as follows:

 

  (a) no subletting shall be for a term ending later than one day prior to the
Expiration Date of this Lease;

 

  (b) no sublease shall be valid, and no subtenant shall take possession of the
Premises or any part thereof, until an executed counterpart of such sublease has
been delivered to Landlord;

 

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  (c) each sublease shall provide that it is subject and subordinate to this
Lease and to the matters to which this Lease is or shall be subordinate, and
that in the event of termination (whether by voluntary surrender or otherwise),
re-entry, or dispossession by Landlord under this Lease, Landlord may, at its
option, take over all of the right, title, and interest of Tenant, as sublessor,
under such sublease, and such subtenant shall, at Landlord’s option, attorn to
Landlord pursuant to the then-executory provisions of such sublease, except that
Landlord shall not be (i) liable for any previous act or omission of Tenant
under such sublease; (ii) subject to any offset, credit, or allowance not
expressly provided in such sublease which theretofore accrued to such subtenant
against Tenant or (iii) bound by any previous modification of such sublease or
by any previous prepayment of more than one month’s rentals; and

 

  (d) each assignment or sublease document must provide that the assignee or
subtenant expressly assumes all obligations of the Tenant under the Lease as
joint and several obligations without any release of Tenant.

17.8 TRANSFER PREMIUM. If Landlord shall give its consent to any assignment of
this Lease or to any sublease, Tenant shall in consideration therefor pay to
Landlord, as Additional Rent, the following amounts (collectively the “Transfer
Premium”):

 

  (a) in the case of an assignment, an amount equal to fifty percent (50%) of
all sums and other considerations paid to Tenant by the assignee for such
assignment, not including sums paid for the sale of Tenant’s Property, and
excluding the following: (i) then-customary brokerage commissions being paid by
Landlord for leasing of space in the Building or, if less, the brokerage
commission paid by Tenant in connection with the assignment; (ii) reasonable
legal fees and disbursements; and (iii) reasonable amounts paid by Tenant for
tenant improvements constructed for the assignee; and

 

  (b) in the case of a sublease, fifty percent (50%) of any rents, additional
charge, or other consideration payable under the sublease to Tenant by the
subtenant which is in excess of the Base Rent and Additional Rent accruing
during the term of the sublease in respect of the subleased space (at the rate
per square foot payable by Tenant hereunder) pursuant to the terms hereof,
including sums paid for the sale or rental of Tenant’s Property, but excluding
the following: (i) in the case of the sale or lease of Tenant’s Property, the
fair-market value of Tenant’s Property; (ii) then-customary brokerage
commissions being paid by Landlord for leasing of space in the Building or, if
less, the brokerage commission paid by Tenant in connection with the sublease;
(iii) reasonable legal fees and disbursements; and (iv) reasonable amounts paid
by Tenant for tenant improvements constructed for the subtenant.

The sums payable as the Transfer Premium under this § 17.8 shall be paid to
Landlord as and when payable by the subtenant or assignee to Tenant.

17.9 ASSUMPTION BY TRANSFEREE. Any Transfer, whether made with Landlord’s
consent pursuant to § 17.1 or without Landlord’s consent pursuant to § 17.1.1,
shall be made only if, and shall not be effective until, the assignee or
subtenant shall execute, acknowledge, and deliver to Landlord an agreement in
form and substance satisfactory to Landlord under which the assignee or
transferee shall assume the obligations of this Lease on the part of Tenant to
be performed or observed, from and after the date of

 

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Transfer, and whereby the assignee or transferee shall agree that the provisions
in § 17.1 shall, notwithstanding such Transfer, continue to be binding upon it
in respect of all future Transfers. The original named Tenant covenants that,
notwithstanding any Transfer, whether or not in violation of the provisions of
this Lease, and notwithstanding the acceptance of Base Rent and/or Additional
Rent by Landlord from an assignee, transferee, or any other party, the original
named Tenant shall remain fully liable for the payment of the Base Rent and
Additional Rent and for the other obligations of this Lease on the part of
Tenant to be performed or observed.

17.10 NO WAIVER OR DISCHARGE. The joint and several liability of Tenant and any
immediate or remote successor in interest of Tenant and the due performance of
the obligations of this Lease on Tenant’s part to be performed or observed shall
not be discharged, released, or impaired in any respect by any agreement or
stipulation made by Landlord extending the time of, or modifying any of the
obligations of, this Lease, or by any waiver or failure of Landlord to enforce
any of the obligations of this Lease.

17.11 LISTING OF NAME. The listing of any name other than that of Tenant,
whether on the doors of the Premises or the Building directory, or otherwise,
shall not operate to vest any right or interest in this Lease or in the
Premises, nor shall it be deemed to be the consent of Landlord to any Transfer
of this Lease or to any sublease of the Premises or to the use or occupancy of
the Premises by others.

17.12 NET PROFITS AGREEMENT. Anything contained in the foregoing provisions of
this Article 17 to the contrary notwithstanding, neither Tenant nor any other
person or entity having an interest in the possession, use, occupancy, or
utilization of the Premises shall enter into any lease, sublease, license,
concession, or other agreement for use, occupancy, or utilization of space in
the Premises which provides for rental or other payment for such use, occupancy,
or utilization based, in whole or in part, on the net income or profits derived
by any person from the premises leased, used, occupied, or utilized (other than
an amount based on a fixed percentage or percentages of receipts or sales); and
any such purported lease, sublease, license, concession, or other agreement
shall be absolutely void and ineffective as a conveyance of any right or
interest in the possession, use, occupancy, or utilization of any part of the
Premises.

17.13 AFFILIATES AND INVESTORS. Notwithstanding anything to the contrary in this
Article 17, Landlord’s consent shall not be required in the event parties owning
stock of Tenant desire to transfer a majority of the stock of Tenant to any
party or parties, or in the event Tenant assigns this Lease or sublets the
Premises or any portion thereof to any corporation or entity which controls, is
controlled by, or is under common control with Tenant, provided and subject to
the following conditions:

 

  (a) Tenant shall not be in default of any of the terms, covenants, or
conditions on Tenant’s part to observe or perform hereunder;

 

  (b) such sublet or assignment shall be subject to all of the terms, covenants,
and conditions of this Lease;

 

  (c) Tenant shall notify Landlord of such transfer, sublet, or assignment in
accordance with § 17.2 hereof and, in the event of a sublease or transfer to an
affiliate, furnish Landlord with reasonably satisfactory evidence that such
sublessee or assignee controls, is controlled by, or is under common control
with Tenant; and

 

  (d)

in the event of a merger, consolidation, or transfer of substantially all of
Tenant’s assets, the successor to Tenant has a net worth, computed in accordance
with generally-accepted accounting principles, at least equal to the greater of
(i) the net worth of Tenant immediately prior to such merger, consolidation, or
transfer or (ii) the net worth of Tenant herein named on the date of this Lease;
and proof

 

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satisfactory to Landlord of such net worth shall have been delivered to Landlord
at least ten (10) days prior to the effective date of any such transaction.

As used herein, the terms control and common control shall be deemed to mean
that the ownership of fifty percent (50%) or more of all of the issued and
outstanding voting shares of such corporation, or fifty percent (50%) or more of
all the legal and equitable interest in any such business entities.

17.14 PERMITTED OCCUPANTS. Landlord hereby agrees that the provisions of this
Article 17 shall not apply to the shared occupancy of individual offices in the
Premises with Tenant by individuals renting not more than one (1) such office
(the “Permitted Occupant”), provided that the space occupied by the Permitted
Occupant shall not be separately demised or contain separate entrances,
demarcations, or reception areas and the occupancy by the Permitted Occupant
shall be upon and subject to all of the terms and conditions of this Lease.

18    SUBORDINATION AND ATTORNMENT

18.1 SUBORDINATION OF LEASE. This Lease and all rights of Tenant hereunder are
and shall be subject and subordinate in all respects to (a) all ground leases,
overriding leases, and underlying leases of the Building, Property, and/or the
Complex now or hereafter existing; (b) all mortgages which may now or hereafter
affect the Building, Property, or Complex and any of such leases, whether or not
such mortgages shall also cover other lands and/or buildings; (c) each and every
advance made or hereafter to be made under such mortgages; and (d) to all
renewals, modifications, replacements, and extensions of such leases and such
mortgages and spreaders and consolidations of such mortgages. This § 18.1 shall
be self-operative, and no further instrument of subordination shall be required.
In confirmation of such subordination, Tenant shall promptly execute and deliver
any instrument that Landlord, the lessor of any such lease or the holder
(“Holder”) of any such mortgage or any of their respective successors in
interest may reasonably request to evidence such subordination. The leases to
which this Lease is, at the time referred to, subject and subordinate pursuant
to this Article 18 are hereinafter sometimes referred to as “Superior Leases”;
the mortgages to which this Lease is, at the time referred to, subject and
subordinate are hereinafter sometimes referred to as “Superior Mortgages”; and
the lessor of a superior lease or its successor in interest at the time referred
to is sometimes hereinafter referred to as a “Lessor.” Notwithstanding the
foregoing, Tenant agrees, upon written request from Landlord or any Holder or
Lessor, to reorder the relative priority of the Lease with respect to any
particular Superior Mortgage or Superior Lease so as to subordinate the lien of
any such Superior Mortgage or Superior Lease to the Lease. Tenant agrees to
execute any instrument which Landlord or any Holder or Lessor may present in
order to effect such prioritization of the Lease, provided that such instrument
does not modify any material term of the Lease or increase Tenant’s obligations
thereunder.

18.2 NOTICE AND CURE RIGHT. In the event of any action or omission of Landlord
which would give Tenant the right, immediately or after lapse of a period of
time, to cancel or terminate this Lease, or to claim a partial or total
eviction, Tenant shall not exercise such right unless and until (i) Tenant shall
have given written notice of such act or omission to the Holder of each Superior
Mortgage and the Lessor of each Superior Lease whose name and address shall
previously have been furnished to Tenant in writing; and (ii) unless such act or
omission shall be one which is not capable of being remedied by Landlord or such
mortgage Holder or Lessor within a reasonable period of time, a reasonable
period for remedying such act or omission shall have elapsed following the
giving of such notice and following the time when such Holder or Lessor shall
have become entitled under such Superior Mortgage or Superior Lease, as the case
may be, to remedy the same (which reasonable period shall in no event be less
than the period to which Landlord would be entitled under this Lease or
otherwise, after similar notice, to effect such remedy), provided such Holder or
Lessor shall with due diligence give Tenant written notice of intention

 

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to remedy such act or omission and shall thereafter diligently and continuously
prosecute such cure to completion.

18.3 ATTORNMENT. If the Lessor of a Superior Lease or the Holder of a Superior
Mortgage shall succeed to the rights of Landlord under this Lease, whether
through possession or foreclosure action or delivery of a new lease or deed,
then at the request of such party so succeeding to Landlord’s rights or other
person having or acquiring title by virtue of such foreclosure or termination
(herein sometimes referred to as “Successor Landlord”) and upon such Successor
Landlord’s written agreement to accept Tenant’s attornment, Tenant shall attorn
to and recognize such Successor Landlord as Tenant’s landlord under this Lease
and shall promptly execute and deliver any instrument that such Successor
Landlord may reasonably request to evidence such attornment. Upon such
attornment this Lease shall continue in full force and effect as a direct lease
between the Successor Landlord and Tenant upon all of the terms, conditions, and
covenants in this Lease, except as follows:

 

  (a) the Successor Landlord shall not be liable for any previous act or
omission of Landlord under this Lease;

 

  (b) the Successor Landlord shall not be subject to any offset (unless
expressly provided for in this Lease) which shall have theretofore accrued to
Tenant against Landlord;

 

  (c) the Successor Landlord shall not be bound by any previous modification of
this Lease, unless expressly provided for in this Lease, or by any previous
prepayment of more than one month’s Base Rent, unless such modification or
prepayment shall have been expressly approved in writing by the Lessor of the
Superior Lease or the Holder of the Superior Mortgage through or by reason of
which the Successor Landlord shall have succeeded to the rights of Landlord
under this Lease.

19    FINANCING REQUIREMENTS

19.1 LENDER-REQUESTED MODIFICATIONS. If, in connection with obtaining financing
or refinancing for the Property or Complex a prospective lender shall request
reasonable modifications to this Lease as a condition to such financing or
refinancing, Tenant shall not withhold, delay, or unreasonably condition its
consent thereto. It is agreed that, among the modifications which shall be
deemed reasonable, are modifications to the subordination and attornment
provisions of this Lease, modifications to the notice provisions of this Lease,
modifications to the provisions of this Lease which permit the lender to cure
any defaults by Landlord, and modifications to the provisions which grant
additional time to cure as may be reasonably required by the lender.

19.2 FAILURE TO COMPLY. If Tenant fails or refuses to execute and deliver to
Landlord, within fifteen (15) days after written notice to do so, the
amendment(s) to this Lease accomplishing such reasonable modification(s),
Landlord, at its sole option, shall have the right either (a) to terminate this
Lease or (b) to execute the amendment for and on behalf of Tenant as its
attorney-in-fact. Tenant hereby irrevocably appoints Landlord as its
attorney-in-fact solely to execute any documents required to carry out the
intent of § 19.1 above on behalf of Tenant.

20    DEFAULT

20.1 TENANT’S DEFAULT. Tenant’s failure to perform any of its obligations under
this Lease when due and in the manner required shall constitute a material
breach and default (“Event of Default”) of this Lease by Tenant, subject to any
cure period(s) permitted or available under applicable laws or statutes. In
addition, the following shall also be deemed Events of Default hereunder:

 

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  (a) Tenant’s failure to take possession of the Premises for a period of sixty
(60) days or longer after the Commencement Date;

 

  (b) Tenant’s abandonment or vacation of the Premises;

 

  (c) any material misrepresentation or omission herein or in any financial
statements or other materials provided by Tenant or any Guarantor in connection
with negotiating or entering this Lease or in connection with any Transfer under
Article 17;

 

  (d) cancellation of any guaranty of this Lease by any Guarantor;

 

  (e) failure by Tenant to cure within any applicable times permitted thereunder
any default under any other lease for space in the Complex or any other
buildings owned or managed by Landlord or its affiliates now or hereafter
entered by Tenant; and any Default hereunder not cured within the times
permitted for cure herein shall, at Landlord’s election, constitute a default
under any other such lease or leases;

 

  (f) The levy of a writ of attachment or execution on this Lease or on any of
Tenant’s property;

 

  (g) Tenant’s or any Guarantor’s general assignment for the benefit of
creditors or arrangement, composition, extension, or adjustment with its
creditors;

 

  (h) Tenant’s or any Guarantor’s filing of a voluntary petition for relief, or
the filing of a petition against Tenant or any Guarantor in a proceeding under
the Federal Bankruptcy laws or other insolvency laws which is not withdrawn or
dismissed within forty-five (45) days thereafter; or, under the provisions of
any law providing for reorganization or winding up of corporations, the
assumption by any court of competent jurisdiction of jurisdiction, custody, or
control of Tenant or any substantial part of its property, or of any Guarantor,
where such jurisdiction, custody, or control remains in force unrelinquished,
unstayed, or unterminated for a period of forty five (45) days;

 

  (i) In any proceeding or action in which Tenant is a party, the appointment of
a trustee, receiver, agent; or custodian to take charge of the Premises or
Tenant’s Property for the purpose of enforcing a lien against the Premises or
Tenant’s Property; or

 

  (j) If Tenant or any Guarantor is a partnership or consists of more than one
(1) person or entity, the involvement of any partner of the partnership or other
person or entity in any of the acts or events described in subsections
(i) through (1) above.

20.2 LANDLORD’S REMEDIES. Upon the occurrence of an Event of Default hereunder,
Landlord shall have the right, in addition to any other rights or remedies
Landlord may have under Laws, at Landlord’s option, without further notice or
demand of any kind, to elect to do one of the following alternatives:

 

  (i) Terminate, this Lease and Tenant’s right to possession of the Premises,
re-enter the Premises, and take possession thereof; and Tenant shall have no
further claim to the Premises or under this Lease; or

 

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  (ii) Continue this Lease in effect and collect any unpaid Rent or other
charges which have theretofore accrued or which thereafter become due and
payable. It is intended hereunder that Landlord have the remedy described in
California Civil Code § 1951.4, which provides that a landlord may continue a
lease in effect after a tenant’s breach and abandonment and recover rent as it
becomes due, if tenant has the right to sublease or assign, subject only to
reasonable limitations.

In the event of any re-entry or retaking of possession by Landlord, Landlord
shall have the right, but not the obligation, to remove all or any part of
Tenant’s Property from the Premises and to place such property in storage at a
public warehouse at the expense and risk of Tenant.

20.2.1 No Waiver of Default. The waiver by Landlord of any Event of Default or
of any other breach of any term, covenant, or condition of this Lease shall not
be deemed a waiver of such term, covenant, or condition or of any subsequent
breach of the same or any other term, covenant, or condition. Acceptance of Rent
by Landlord subsequent to any Event of Default or breach hereof shall not be
deemed a waiver of any preceding Event of Default or breach other than the
failure to pay the particular Rent so accepted, regardless of Landlord’s
knowledge of any breach at the time of such acceptance of Rent. Landlord shall
not be deemed to have waived any term, covenant, or condition of this Lease,
unless Landlord gives Tenant written notice of such waiver. Tenant should not
rely upon Landlord’s failure or delay in enforcing any right or remedy
hereunder.

20.2.2 Landlord’s Right to Cure. If Tenant defaults in the performance of any of
its obligations under this Lease, Landlord may (but shall not be obligated to),
without waiving such default, perform the same for the account and at the
expense of Tenant. Tenant shall pay Landlord all costs of such performance
promptly upon receipt of a bill therefor.

20.3 DAMAGES. Should Landlord elect to terminate this Lease under the provisions
of § 20.2 (i) above, Landlord may recover as damages from Tenant the following:

 

  (a) Past Rent: The worth at the time of the award of any unpaid Rent which had
been earned at the time of termination; plus

 

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

 

  (c) Rent After Award: The worth at the time of the award of the amount by
which the unpaid Rent for the balance of the Term after the time of award
exceeds the amount of the rental loss that Tenant proves could have been
reasonably avoided; plus

 

  (d) Proximately Caused Damages: Any other amount necessary to compensate
Landlord for all detriment proximately caused by Tenant’s failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom, including, but not limited to, any costs or expenses
(including attorneys’ fees), incurred by Landlord in (i) retaking possession of
the Premises; (ii) maintaining the Premises after Tenant’s default;
(iii) preparing the Premises for reletting to a new tenant, including any
repairs or alterations; and (iv) reletting the Premises, including brokers’
commissions.

“The worth at the time of the award” as used in subsections (a) and (b) above is
to be computed by allowing interest at the rate of ten percent (10%) per annum
or, if different, the legal rate then applicable

 

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in California. “The worth at the time of the award” as used in subsection
(c) above is to be computed by discounting the amount at the discount rate of
the Federal Reserve Bank situated nearest to the Premises at the time of the
award plus one percent (1%).

20.4 LANDLORD’S DEFAULT. If Landlord fails to perform any covenant, condition,
or agreement contained in this Lease within thirty (30) days after receipt of
written notice from Tenant specifying a default and the relevant Lease
provision, or if Landlord fails within that thirty-day period after notice to
commence to cure any such default which cannot reasonably be cured within thirty
(30) days, then, subject to § 21.1 below, Landlord shall be liable to Tenant for
any damages sustained by Tenant as a result of Landlord’s breach. Tenant shall
not have the right to terminate this Lease or to withhold, reduce, or offset any
amount against any payments of Rent or any other charges due and payable under
this Lease, except to the extent that a specific Lease provision permits such
termination or withholding, reduction, or offset of Rent

20.5 HOLDER’S RIGHT TO CURE. Tenant shall give any Holder a copy, by registered
mail, of any notice of default served upon Landlord, provided that Tenant
previously has been notified in writing of the address of such Holder. If
Landlord fails to cure such default within the time provided in this Lease, any
such Holder shall have an additional forty-five (45) days within which to cure
such default by Landlord or, if such default cannot reasonably be cured within
that time, such additional time as may be necessary, provided that within such
forty-five (45) day period the Holder has commenced and is pursuing the remedies
necessary to cure such default (including 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 pursued.

20.6 SURVIVAL OF REMEDIES. The remedies permitted under this Article 20, the
parties’ indemnities under §§ 14.4.3, 14.4.4, and l4.4.5, and § 29.5 below shall
survive the termination of this Lease.

21    LIMITATIONS ON LANDLORD’S LIABILITY

21.1 PERSONAL LIABILITY. The liability of Landlord to Tenant for any default by
Landlord under this Lease or arising in connection herewith or with Landlord’s
operation, management, leasing, repair, renovation, alteration, or any other
matter relating to the Property or the Premises shall be limited to the interest
of Landlord in the Property (and the rental proceeds thereof). Under no
circumstances shall Landlord ever be liable for consequential or punitive
damages, including damages for lost profits or for business interruption. Tenant
agrees to look solely to Landlord’s interest in the Property (and the rental
proceeds thereof) for the recovery of any judgement against Landlord, and
Landlord shall not be personally liable for any such judgement or deficiency
after execution thereon. The limitations of liability contained in this Article
21 shall apply equally and inure to the benefit of Landlord’s present and future
partners, beneficiaries, officers, directors, trustees, shareholders, agents,
and employees, and their respective partners, heirs, successors, and assigns.
Under no circumstances shall any present or future general or limited partner of
Landlord (if Landlord is a partnership), or trustee or beneficiary (if Landlord
or any partner of Landlord is a trust) or corporate officer, director, or
shareholder (if Landlord or any partner of Landlord is a corporation or company)
or member (if Landlord is a limited liability company) have any liability for
the performance of Landlord’s obligations under this Lease.

21.2 LIABILITY UPON TRANSFER. The term Landlord as used in this Lease, so far as
covenants or obligations on the part of the Landlord are concerned, shall be
limited to mean and include only the owner or owners, at the time in question,
of the fee title to, or a lessee’s interest in a ground lease or master lease of
the Property. In the event of any transfer, assignment, or other conveyance or
transfer of any such title or interest, Landlord herein named (and in case of
subsequent transfers or conveyances, the current grantor) shall be automatically
freed and relieved from and after the date of such transfer,

 

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assignment, or conveyance of all liability with respect to the performance of
any covenants or obligations on the part of Landlord contained in this Lease
thereafter to be performed; and, without further agreement, the transferee of
such title or interest shall be deemed to have assumed and agreed to observe and
perform any and all obligations of Landlord hereunder, during its ownership of
the Premises. Landlord may transfer its interest in the Premises without the
consent of Tenant, and such transfer or subsequent transfer shall not be deemed
a violation on Landlord’s part of any of the terms and conditions of this Lease.

22    ESTOPPEL CERTIFICATES

22.1 REQUEST AND DELIVERY. Within ten (10) days following any written request
Landlord may make from time to time, Tenant without any charge therefor, shall
execute, acknowledge, and deliver a statement certifying the following: (a) the
Commencement Date of this Lease; (b) the fact that this Lease is unmodified and
in full force and effect or, if there have been modifications hereto, that this
Lease is in full force and effect, as modified, and stating the date and nature
of such modifications; (c) the date to which the Rent and other sums payable
under this Lease have been paid; (d) the fact that there are no current defaults
under this Lease by either Landlord or Tenant except as specified in the
statement; and (e) such other matters as may be reasonably requested by
Landlord. Landlord and Tenant intend that any statement delivered pursuant to
this Article 22 may be relied upon by any Holder, Lessor, beneficiary,
purchaser, or prospective purchaser of the Building, the Complex, or any
interest therein. Tenant’s failure to deliver any such statement within the
specified ten-day period shall constitute a material default hereunder, and
Tenant shall indemnify, defend, protect, and hold Landlord harmless from and
against any and all Claims which Landlord may sustain or incur as a result of or
in connection with Tenant’s failure or delay in delivering such statement.

22.2 ELECTION TO SELL BUILDING. If Landlord elects to sell the Building or to
obtain loans secured by a lien on the Building, Tenant, promptly after demand,
shall include with the estoppel certificate(s) provided to any prospective
purchaser or lender as required under this Article 22 any financial statements
of Tenant reasonably required by the purchaser or lender. The financial
statements so provided shall be kept confidential as to any parties other than
the purchaser or lender.

23    NOTICES

23.1 MANNER OF DELIVERY. Any notice required or permitted under this Lease shall
be in writing and shall be delivered in at least one of the following ways:
(a) personally or by private hand-delivery messenger service; (b) by depositing
the same in the United States mail, postage prepaid, registered or certified,
return receipt requested; or (c) by depositing such notice, postage prepaid,
with Federal Express or another nationally-recognized private overnight delivery
service. Each such notice shall be addressed to the intended recipient at such
party’s address set forth as follows, or at such other address as such party has
theretofore specified by written notice delivered in accordance with this §
23.1:

if to Landlord:

KASHIWA FUDOSAN AMERICA, INC.

c/o Cushman & Wakefield of California, Inc.

Attn: Property Manager

400 Oyster Point Boulevard, Suite 117

South San Francisco, CA 94080

 

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copy to:

Charles Dunn Real Estate Services, Inc., Agent

Attn: Oyster Point Asset Manager

4041 MacArthur Boulevard, Suite 475

Newport Beach, CA 92260

if to Tenant:

NOVACEA, INC.

Attn: General Manager

400 Oyster Point Boulevard, Suite 200

South San Francisco, CA 94080

23.2 REQUIRED CONTENTS. Every notice (other than the giving or withholding of
consent or approval under the provisions of the Lease) given to a party shall
state the section of the Lease pursuant to which the notice is given; the period
of time within which the recipient of the notice must respond (or, if no
response is required, a statement to that effect); and if applicable, that the
failure to object to the notice within the stated time period will be deemed to
be the equivalent of the recipient’s approval, consent to, or satisfaction with
the subject matter of the notice.

23.3 PRESUMPTION OF RECEIPT. Any notice delivered personally or by private
messenger service shall be deemed delivered on the next day following the
deposit of such notice at the recipient’s address. Any notice delivered by
Federal Express or another nationally-recognized private overnight delivery
service shall be deemed delivered on the earlier of (y) the second day following
deposit thereof with the carrier or (z) the delivery date shown on the carrier’s
record of delivery. Any notice delivered by mail in the manner specified in §
23.1 shall be deemed delivered on the earlier of (a) the third day following
deposit thereof in the United States Mail or (b) the delivery date shown on the
return receipt prepared in connection therewith. Refusal by Tenant or Landlord
to accept either certified or registered mail shall constitute a waiver of such
notice by the respective party.

24    BROKERS

24.1 TENANT’S REPRESENTATION. Tenant represents and warrants to Landlord that
Tenant has dealt with no broker in connection with this Lease other than BT
Commercial and Cushman & Wakefield of California, Inc. Tenant shall be
responsible for all foreseeable consequences of damages (including attorneys’
fees and costs) resulting from any claims that may be asserted against Landlord
by any other broker, finder, or other person with whom Tenant has or purportedly
has dealt in connection with this Lease, and Tenant agrees to indemnify, defend,
protect, and hold Landlord harmless in connection with any such Claims which may
be asserted.

25    RIGHTS RESERVED TO LANDLORD

25.1 ACCESS TO PROPERTY. All of the Property except the inside surfaces of all
walls, windows, and doors bounding the Premises (including exterior Building
walls, core corridor walls and doors, and any core corridor entrance) and any
space in or adjacent to the Premises used for shafts, stacks, pipes, conduits,
fan rooms, ducts, electric, or other utilities, sinks or other Building
facilities, and the use thereof, as well as access thereto through the Premises
for the purpose of operation, maintenance, decoration, and repair, are reserved
to Landlord. Tenant shall permit Landlord to install, use, replace, and maintain
pipes, ducts, and conduits within the demising walls, bearing columns, and
ceilings of the Premises.

 

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25.2 CONTROL OF PROPERTY. Except to the extent expressly limited herein,
Landlord reserves full rights to control the Property (which rights may be
exercised without subjecting Landlord to claims for constructive eviction,
abatement of Rent, damages, or other claims of any kind), including more
particularly the following rights:

 

  (a) Name, Address, Access. To change the name or street address of the
Property; install and maintain signs on the exterior and interior of the
Property; retain at all times, and use in appropriate instances, keys to all
doors within and into the Premises; grant to any Person the right to conduct any
business or render any service at the Property, whether or not it is the same or
similar to the use permitted Tenant by this Lease; and have access for Landlord
and other tenants of the Property to any mail chutes located on the Premises
according to the rules of the United States Postal Service.

 

  (b) Entry into Premises. To enter the Premises at reasonable hours for
reasonable purposes, including inspection and supplying cleaning service or
other services to be provided Tenant hereunder, to show the Premises to current
and prospective lenders, ground lessors, insurers, and prospective purchasers,
tenants and brokers, at reasonable hours; and if Tenant shall abandon the
Premises at any time, or shall vacate the same during the last three (3) months
of the Term, to decorate, remodel, repair, or alter the Premises.

 

  (c) Safety Measures. To limit or prevent access to the Property, shut down
elevator service, activate elevator emergency controls, or otherwise take such
action or preventative measures deemed necessary by Landlord for the safety of
tenants or other occupants of the Property or the protection of the Property and
other property located thereon or therein, in case of fire, invasion,
insurrection, riot, civil disorder, public excitement or other dangerous
condition, or threat thereof.

 

  (d) Improvements. To decorate and to make alterations, additions and
improvements, structural or otherwise, in or to the Property or any part
thereof, and any adjacent building, structure, parking facility, land, street or
alley (including changes and reductions in corridors, lobbies, parking
facilities and other public areas and the installation of kiosks, planters,
sculptures, displays, escalators, mezzanines, and other structures, facilities,
amenities and features therein, and changes for the purpose of connection with
or entrance into or use of the Property in conjunction with any adjoining or
adjacent building or buildings, now existing or hereafter constructed). In
connection with such matters, or with any other repairs, maintenance,
improvements or alterations, in or about the Property, Landlord may erect
scaffolding and other structures reasonably required, and during such operations
may enter upon the Premises and take into and upon or through the Premises, all
materials required to make such repairs, maintenance, alterations or
improvements, and may close public entry ways, other public areas, restrooms,
stairways or corridors.

25.3 LANDLORD’S RIGHT TO MAINTAIN. Except as expressly otherwise provided in
this Lease, Landlord shall have no liability to Tenant by reason of any
inconvenience, annoyance, interruption, or injury to business arising from
Landlord’s making any repairs or changes which Landlord is required or permitted
to make by this Lease, by any other lease or agreement affecting the Property,
or by Law, in or to any portion of the Property, Complex, or the Premises,
including the Systems and Equipment and appurtenances of the Property or the
Premises, provided that Landlord shall use due diligence with

 

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respect thereto and shall perform such work, except in case of emergency, at
times reasonably convenient to Tenant and otherwise in such manner as will not
materially diminish Tenant’s beneficial enjoyment of the Premises for their
intended use.

25.4 REASONABLE NOTICE. In connection with entering the Premises to exercise any
of the foregoing rights, Landlord shall: (a) provide reasonable advance written
or oral notice to Tenant’s on-site manager or other appropriate person (except
in emergencies, or for routine cleaning or other routine matters), and (b) take
reasonable steps to avoid any unreasonable interference with Tenant’s business.

26    HOLDING OVER

26.1 HOLDOVER. Unless Landlord expressly agrees otherwise in writing, Tenant
shall pay Landlord two hundred percent (200%) of the amount of Rent then
applicable prorated on per diem basis for each day Tenant shall retain
possession of the Premises or any part thereof after expiration of the Term or
earlier termination of this Lease, together with all damages sustained by
Landlord on account thereof. The foregoing provisions shall not serve as
permission for Tenant to hold over, nor serve to extend the Term, although
Tenant shall remain bound to comply with all provisions of this Lease until
Tenant vacates the Premises and shall be subject to the provisions of § 11.1
above.

26.2 PERMISSIVE MONTH-TO-MONTH TENANCY. Notwithstanding the foregoing to the
contrary, at any time before or after expiration or earlier termination of the
Term of the Lease, Landlord may serve notice advising Tenant of the amount of
Rent and other terms required, should Tenant desire to enter a month-to-month
tenancy. If Tenant shall hold over more than one full calendar month after such
notice, Tenant shall thereafter be deemed a month-to-month tenant, on the terms
and provisions of this Lease then in effect, as modified by Landlord’s notice,
except that Tenant shall not be entitled to, any renewal or expansion rights
contained in this Lease or any amendments hereto.

27    PARKING

27.1 AVAILABLE PARKING. Subject to the terms and conditions contained in the
balance of this Article 28, Landlord agrees to make available to Tenant during
the Term of this Lease and any renewal term up to a maximum of eighty-nine
(89) parking spaces on a non-exclusive basis in the area(s) designated by
Landlord for parking in the Building’s parking lots and/or facility (the
“Parking Facility”). Said parking spaces shall be in locations designated by
Landlord, and parking shall be on a first-come-first-served, unassigned,
nonreserved basis. Landlord reserves the right to designate different locations
or different parking areas for Tenant’s use without any liability to Tenant and
Tenant agrees that any change shall not give rise to any claims or offset
against Landlord hereunder. Tenant shall abide by any and all parking
regulations and rules established from time to time by Landlord or Landlord’s
parking operator. Landlord reserves the right in its sole and absolute
discretion to restrict or prohibit the use of the Parking Facility for any
vehicles other than passenger automobiles, such as full-sized vans or trucks.
Tenant shall not permit any vehicles belonging to Tenant or Tenant’s employees,
agents, customers, contractors, or invitees to be loaded, unloaded, or parked in
areas other than those designated by Landlord for such activities. A failure to
comply with the foregoing provisions shall afford Landlord the right without
notice to remove any vehicles involved and to charge the cost to Tenant, which
cost shall be immediately due and payable upon demand by Landlord.

27.2 USE AT TENANT’S OWN RISK. Landlord shall have no obligation to monitor the
use of the Parking Facility. Tenant’s and its employees’ use of the Parking
Facility shall be at the sole risk of Tenant and its employees. Unless caused by
the willful harmful act of Landlord, Landlord shall have no responsibility or
liability for any injury or damage to any person or property by or as a result
of the use of the Parking Facility (or substitute parking) by Tenant and its
employees, whether by theft, collision, criminal activity,

 

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or otherwise, and Tenant hereby assumes, for itself and its employees, all risks
associated with any such occurrences in or about the Parking Facility.

28    MISCELLANEOUS PROVISIONS.

28.1 GENERAL DEFINITIONS. The definitions which follow shall apply generally to
the provisions of this Lease.

 

  (a) The term business days means Monday through Friday inclusive, excluding
Holidays as defined in § 8.1.1 above. Throughout this Lease, wherever days is
used the term shall refer to calendar days. Wherever the term business days is
used the term shall refer to business days as defined hereunder.

 

  (b) The term mortgage shall include any mortgage or deed of trust, and the
term mortgagee shall include a trustee.

 

  (c) The terms include, including, and such as shall each be construed as if
followed by the phrase “without limitation.” The rule of eiusdem generis shall
not be applicable to limit a general statement following or referrable to an
enumeration of specific matters to matters similar to the matters specifically
mentioned.

 

  (d) The term obligations under this Lease and words of like import shall mean
the covenants to pay Rent and Additional Rent under this Lease and all of the
other covenants and conditions contained in this Lease. Any provision in this
Lease that one party or the other or both shall do or not do or shall cause or
permit or not cause or permit a particular act, condition, or circumstance shall
be deemed to mean that such party so covenants or both parties so covenant, as
the case may be.

 

  (e) The term Tenant’s obligations hereunder and words of like import and the
term Landlord’s obligations hereunder and words of like import shall mean the
obligations under this Lease which are to be performed or observed by Tenant, or
by Landlord, as the case may be. Reference to performance of either party’s
obligations under this lease shall be construed as “performance and observance.”

 

  (f) Reference to Tenant being or not being in default hereunder or words like
import shall mean that Tenant is in default in the performance of one or more of
Tenant’s obligations hereunder, or that Tenant is not in default in the
performance of any of Tenant’s obligations hereunder, or that a condition of the
character described in § 20.1 above has occurred and continues or has not
occurred or does not continue, as the case maybe.

 

  (g) References to Landlord as having no liability to Tenant or being without
liability to Tenant shall mean that Tenant is not entitled to terminate this
Lease or to claim actual or constructive eviction, partial or total, or to
receive any credit, allowance, setoff, abatement, or diminution of Rent, or to
be relieved in any manner of any of its other obligations hereunder, or to be
compensated for loss or injury suffered or to enforce any other kind of
liability whatsoever against Landlord under or with respect to this Lease or
with respect to Tenant’s use or occupancy of the Premises.

 

  (h)

The term requirements of insurance bodies and words of like import shall mean
rules, regulations, orders, and other requirements of the California Board of
Fire Underwriters and/or the California Fire Insurance Rating Organization
and/or any

 

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other similar body performing the same or similar functions and having
jurisdiction or cognizance of the Property and/or the Premises.

 

  (i) The term repair shall be deemed to include restoration and replacement as
may be necessary to achieve and/or maintain good working order and condition.

 

  (j) Reference to termination of this Lease includes expiration or earlier
termination of the Term of this Lease or cancellation of this Lease pursuant to
any of the provisions of this Lease or to Law. Upon a termination of this Lease,
the Term and estate granted by this Lease shall end at noon of the date of
termination as if such date were the date of expiration of the Term of this
Lease, and neither party shall have any further obligation or liability to the
other after such termination, except as shall be expressly provided for in this
Lease and except for any such obligation as by its nature or under the
circumstances can only be, or by the provisions of this Lease may be, performed
after such termination; and in any event, unless expressly provided to the
contrary in this Lease, any liability for a payment or obligation which shall
have accrued to or with respect to any period ending at the time of termination
shall survive the termination of this Lease.

 

  (k) The term in full force and effect when herein used in reference to this
Lease as a condition to the existence or exercise of a right on the part of
Tenant shall be construed in each instance as including the further condition
that at the time in question no default on the part of Tenant exists, and no
event has occurred which has continued to exist for such period of time (after
the notice, if any, required by this Lease), as would entitle Landlord to
terminate this Lease or to dispossess Tenant.

 

  (1) The term Tenant shall mean Tenant herein named or any assignee, heir,
distributee, executor, administrator, legal representative, or other successor
in interest (immediate or remote) of Tenant herein named; while such Tenant or
such assignee or other successor in interest, as the case may be, is in
possession of the Premises as owner of the Tenant’s estate and interest granted
by this Lease and also, if Tenant is not a single individual or a corporation,
all of the persons, firms, and corporations then comprising Tenant; and their
liability hereunder shall be joint and several.

28.2 LIGHT AND AIR. No diminution of light, air or view by any structure which
may hereafter be erected (whether or not by Landlord) shall entitle Tenant to
any reduction of Rent under this Lease, result in any liability of Landlord to
Tenant, or in any other way affect this Lease.

28.3 WAIVER OF TERMS. If either Landlord or Tenant waives the performance of any
term, covenant, or condition contained in this Lease, such waiver shall not be
deemed to be a waiver of the term, covenant, or condition itself or a waiver of
any subsequent breach of the same or any other term, covenant, or condition
contained herein. Furthermore, the acceptance of Rent by Landlord shall not
constitute a waiver of any preceding breach by Tenant of any term, covenant, or
condition of this Lease, regardless of Landlord’s knowledge of such preceding
breach at the time Landlord accepts such Rent. Failure by Landlord to enforce
any of the terms, covenants, or conditions of this Lease for any length of time
shall not be deemed to waive or to decrease the right of Landlord to insist
thereafter upon strict performance by Tenant. Waiver by Landlord of any term,
covenant, or condition contained in this Lease may only be made by a written
document signed by Landlord.

28.4 FAILURE TO DELIVER STATEMENTS. Landlord’s failure during the Term of this
Lease to prepare and deliver any of the Statements, estimates, notices, or bills
contemplated or required under this Lease, or

 

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Landlord’s failure to make a demand, shall not in any way cause Landlord to
forfeit or surrender its rights to collect any of the foregoing items of Rent
which may have become due during the Term of this Lease.

28.5 ATTORNEY’S FEES. In the event that any action or proceeding (including
arbitration) is brought to enforce or interpret any term, covenant, or condition
of this Lease on the part of Landlord or Tenant, the prevailing party in such
action or proceeding (whether after trial or upon appeal) shall be entitled to
recover from the party not prevailing its expenses therein, including reasonable
attorneys’ fees and all allowable costs as fixed by the court.

28.6 JURY TRIAL. Tenant and Landlord each hereby waive their respective rights
to a trial by jury under applicable Laws in the event of any litigation or
dispute between Landlord and Tenant arising out of or in connection with this
Lease and the parties’ performance thereunder.

28.7 MERGER. Notwithstanding the acquisition (if same should occur) by the same
party of the title and interests of both Landlord and Tenant under this Lease,
there shall never be a merger of the estates of Landlord and Tenant under this
Lease, but instead the separate estates, rights, duties, and obligations of
Landlord and Tenant, as existing hereunder, shall remain unextinguished and
continue, separately, in full force and effect until this Lease expires or
otherwise terminates in accordance with the express provisions herein contained.

28.8 NO MERGER ON VOLUNTARY SURRENDER. A voluntary or other surrender of this
Lease by Tenant or the mutual cancellation of this Lease shall not work a merger
and shall, at the option of Landlord, terminate all or any existing subleases or
subtenancies, or may, at the option of Landlord, operate as an assignment to it
of any or all such subleases or subtenancies.

28.9 CONSENT. Notwithstanding anything contained in this Lease to the contrary,
Tenant shall have no claim and hereby waives the right to any claim against
Landlord for money damages by reason of any refusal, withholding, or delaying by
Landlord of any consent, approval, statement, or satisfaction; and in such
event, Tenant’s only remedies therefor shall be an action for specific
performance, injunction, or declaratory judgement to enforce any right to such
consent, approval, statement, or satisfaction.

28.10 COUNTERPARTS. This Lease may be executed in multiple counterparts, each of
which shall be deemed an original and all of which together shall constitute one
and the same instrument.

28.11 FINANCIAL STATEMENTS. In order to induce Landlord to enter into this
Lease, Tenant agrees that it shall promptly furnish Landlord, from time to time,
upon Landlord’s written request, with financial statements reflecting Tenant’s
current financial condition. Tenant represents and warrants that all financial
statements, records, and information furnished by Tenant to Landlord in
connection with this Lease are and shall be true, correct, and complete in all
respects.

28.12 GENDER AND NUMBER. Words used in neuter gender include the feminine and
masculine, where applicable, and words used in the singular or plural shall
include the opposite number if appropriate.

28.13 JOINT AND SEVERAL OBLIGATION. If more than one person executes this Lease
as Tenant, each of them is jointly and severally liable for the keeping,
observing, and performing of all of the terms, covenants, conditions,
provisions, and agreements of this Lease to be kept, observed, and performed by
Tenant. The term Tenant as used in this Lease shall mean and include each of
such signatories jointly and severally. The act of or notice from, or notice or
refund to, or the signature of, any one or more of such signatories with respect
to the tenancy or this Lease, including any renewal, extension, expiration,
termination, or modification of this Lease, shall be binding upon each and all
of the persons executing

 

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this Lease as Tenant with the same force and effect as if each and all of them
had so acted or so given or received such notice or refund or so signed.

28.14 HEADINGS AND SECTION NUMBERS. The headings and titles of the articles and
sections of this Lease are used for convenience only and shall have no effect
upon the construction or interpretation of this Lease. Wherever a reference is
made in this Lease to a particular article or section, such reference shall be
deemed to include all subsections following such section reference, unless the
contrary is expressly provided in connection with such reference. All references
in this Lease to numbered articles, numbered sections, and lettered exhibits are
references to articles and sections of this Lease and exhibits annexed to (and
thereby made part of) this Lease, as the case may be, unless expressly otherwise
designated in the context.

28.15 TIME. Time is of the essence of this Lease and all of its provisions.

28.16 APPLICABLE LAW. This Lease shall in all respects be governed by and
interpreted in accordance with the laws of the State of California without
reference to its conflicts of law principles. If suit is brought by a party to
this Lease, the parties agree that jurisdiction of such action shall be vested
exclusively in the state courts of the State of California, County of San Mateo,
or in the United States District Court for the Northern District of California,
and with its execution an delivery of this Lease Tenant waives any defense it
might otherwise have against the jurisdiction of such courts.

28.17 SEVERABILITY. If any provision of this Lease or the application thereof to
any person or circumstance shall be invalid or unenforceable to any extent, the
remainder of this Lease and the application of such provision to other persons
or circumstances shall not be affected thereby and shall be enforced to the
greatest extent permitted by law.

28.18 SIGNS. Tenant shall not place or permit to be placed in or upon the
Premises where visible from outside the Premises or any part of the Building,
any signs, notices, drapes, shutters, blinds or window coatings, or displays of
any type without the prior written consent of Landlord. Landlord shall provide,
at Landlord’s sole cost and expense, a building standard sign on or near the
entrance of the Premises and shall include Tenant in the Building and Complex
directories located in the Building. Landlord reserves the right in Landlord’s
sole discretion to place and locate on the roof and exterior of the Building and
Complex and in any area of the Building and the Complex not leased to Tenant,
such signs, notices, displays and similar items as Landlord deems appropriate in
the proper operation of the Building and the Complex.

28.18.1 Monument Signage. Notwithstanding anything to the contrary herein,
Tenant shall have the right to install one (1) building monument sign at
Tenant’s sole cost and expense, subject to reasonable approval by Landlord as to
the style, size, and location of the monument. Tenant shall be responsible for
submitting any requisite monument plans and permit application to City of South
San Francisco and obtaining its approval.

28.19 EXECUTION BY LANDLORD. The submission of this document for examination and
negotiation does not constitute an offer to lease, or a reservation of, or
option for, the Premises. This document becomes effective and binding only upon
execution and delivery hereof by Tenant and by Landlord. No act or omission of
any employee or agent of Landlord or of Landlord’s broker shall alter, change or
modify any of the provisions hereof.

28.20 USE OF NAME. Tenant shall not use the name of the Building or Complex for
any purpose other than the address of the business to be conducted by Tenant in
the Premises. Tenant shall not use any picture of the Building or Complex in its
advertising, stationery or in any other manner so as to imply that the entire
Building or Complex is leased by Tenant. Landlord expressly reserves the right
at any

 

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time to change the name or street address of the Building and/or Complex without
in any manner being liable to Tenant therefor.

28.21 NONRECORDABILITY OF LEASE. Tenant agrees that in no event shall this Lease
or a memorandum hereof be recorded without Landlord’s express prior written
consent, which consent Landlord may withhold in its sole discretion.

28.22 CONSTRUCTION. All provisions hereof, whether covenants or conditions,
shall be deemed to be both covenants and conditions. The definitions contained
in this Lease, shall be used to interpret the Lease. All rights and remedies of
Landlord and Tenant shall, except as otherwise expressly provided, be cumulative
and non-exclusive of any other remedy at law or in equity.

28.23 FORCE MAJEURE DELAYS. This Lease and the obligations of Tenant hereunder
shall not be affected or impaired because Landlord is unable to fulfill any of
its obligations hereunder or is delayed in doing so, if such inability or delay
is caused by reason of force majeure, strike, labor troubles, acts of God, acts
of government, unavailability of materials or labor, or any other cause beyond
the reasonable control of Landlord (collectively “Force Majeure Delays”).

28.24 AUTHORITY. If Tenant is a corporation, each individual executing this
Lease on behalf of Tenant represents and warrants that Tenant is qualified to do
business in California and that he is duly authorized to execute and deliver
this Lease on behalf of Tenant and shall deliver appropriate certification to
that effect if requested. If Tenant is a limited liability company, partnership,
joint venture, or other unincorporated association, each individual executing
this Lease on behalf of Tenant represents and warrants that he is duly
authorized to execute and deliver this Lease on behalf of Tenant and that this
Lease is binding on Tenant. Furthermore, Tenant agrees that the execution of any
written consent hereunder, or any written modification or termination of this
Lease, by any general partner or member of Tenant or any other authorized agent
of Tenant, shall be binding on Tenant.

28.25 NONDISCLOSURE. Tenant agrees that it shall not disclose any of the matters
set forth in this Lease or disseminate or distribute any information concerning
the terms, covenants, or conditions thereof to any person, firm, or entity,
other than a prospective assignee or subtenant of the Premises, without first
obtaining the express written approval of Landlord; provided, however, that
Tenant may disclose the contents of this Lease to any director, officer, or
employee of Tenant, to Tenant’s lawyers, accountants, or other third party
consultants or professionals, to any lenders, investors, or others to whom
Tenant provides financial statements, or in response to any legally effective
demand for disclosure pursuant to court order or from any other properly
constituted legal authority.

28.26 QUIET ENJOYMENT. So long as Tenant is not in default under this Lease,
Tenant shall have quiet enjoyment of the Premises for the Term, subject to all
the terms and conditions of this Lease and all liens and encumbrances prior to
this Lease.

28.27 EXHIBITS AND ATTACHMENTS. All exhibits and attachments referred to in the
body of this Lease are deemed attached hereto and incorporated herein by
reference. The parties have attached the following exhibits to the Lease prior
to execution:

 

Exhibit A      Site Plan Exhibit B      Floor Plan of Premises Exhibit C     
Rules and Regulations Exhibit D      Athletic Facility Use Agreement Exhibit E
     Commencement Date Agreement Exhibit F      Work Letter Agreement

 

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28.28 LANDLORD’S REPRESENTATIVE. Tenant acknowledges and agrees that, in
executing this Lease, TAK Development, Inc., a California corporation, is acting
solely in its capacity as Landlord’s authorized attorney-in-fact. TAK
Development, Inc. is not acquiring or assuming any legal liability or obligation
to any other party executing this Lease, and any claim or demand of any such
other party arising under or with respect to this Lease shall be made and
enforced solely against Landlord.

28.29 ENTIRE AGREEMENT. This Lease, together with its exhibits, contains all the
agreements of the parties hereto and supersedes any previous negotiations. There
have been no representations made by the Landlord or understandings made between
the parties other than those set forth in this Lease and its exhibits. This
Lease may not be modified except by a written instrument duly executed by the
parties hereto.

In witness whereof, the parties have executed this Lease as of the date first
above written.

 

Landlord:       Tenant: KASHIWA FUDOSAN AMERICA, INC., a California corporation
      NOVACEA, INC., a Delaware corporation         By:    TAK Development,
Inc., a California corporation       By:   

/s/ John P. Walker

            John P. Walker             [name typed]         Its:   
Attorney-in-Fact       Its:    INTERIM CEO and Chairman of the Board    By:   

/s/ Toru Iwai

               Toru Iwai, Vice President 6/5/07         

 

/s/ Robert L. Delsman

Robert L. Delsman Approved as to Legal Form and Sufficiency ‘00’07-11:19:36
2007.05.20

 

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OYSTER POINT MARINA PLAZA

Rules And Regulations

 

1. The sidewalks, doorways, halls, stairways, vestibules and other similar areas
shall not be obstructed by Tenant or used by Tenant for any purpose other than
ingress to and egress from the Premises and going from one part of the Building
to another part.

 

2. Plumbing fixtures shall be used only for their designated purpose, and no
foreign substances of any kind shall be thrown therein. Damage to any such
fixture resulting from misuse by Tenant or any employee or invitee of Tenant
shall be repaired at the expense of Tenant.

 

3. Tenant shall not install any radio or television antenna, loudspeaker, or
other device on the roof or exterior walls of the Building. No TV or radio or
recorder shall be played in such a manner as to cause a nuisance to any other
tenant.

 

4. There shall not be used in any space, or in the public halls of the Building,
either by Tenant or others, any hand trucks except those equipped with rubber
tires and side guards or such other material handling equipment as Landlord may
approve. No other vehicles of any kind shall be brought by any tenant into the
Building or kept in or about its premises.

 

5. Tenant shall store all its trash and garbage within its Premises. No material
shall be placed in the hallways or in the trash boxes or receptacles if such
material is of such nature that it may not be disposed of in the ordinary and
customary manner of removing and disposing of office building trash and garbage
in the City of South San Francisco without, being in violation of any law or
ordinance governing such disposal. All garbage and refuse disposal shall be made
only through entryways and elevators provided for such purposes and at such
times as Landlord shall designate.

 

6. The requirements of tenants will be attended to only upon application in
writing at the office of the Building. Employees of Landlord shall not perform
any work or do anything outside of their regular duties unless under special
instructions from Landlord.

 

7. These Rules and Regulations are in addition to, and shall not be construed to
in any way modify or amend, in whole or in part, the agreements, covenants,
conditions, and provisions of any lease of premises in the Building.

 

8.

Tenant shall not occupy the Building or permit any portion of the Building to be

 

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occupied for the manufacture or direct sale of liquor, narcotics, or tobacco in
any form, or as a medical office, barber shop, manicure shop, music or dance
studio, or employment agency. Tenant shall not conduct in or about the Building
any auction, public or private, without the prior written approval of Landlord.

 

9. Tenant shall not use in the Building any machines, other than standard office
machines such as typewriters, calculators, personal computers, photocopiers, and
similar machines, without the prior written approval of Landlord. All office
equipment and any other device of any electrical or mechanical nature shall be
placed by Tenant in the Premises in settings approved by Landlord, so as to
absorb or prevent any vibration, noise, or annoyance. Tenant shall not cause
improper noises, vibrations, or odors within the Building.

 

10. Tenant shall not enter the mechanical rooms, air conditioning rooms,
electrical closets, janitorial closets, or similar areas or go upon the roof of
the Building without the prior written consent of Landlord.

 

11. Tenant shall not mark, paint, drift into, cut, string wires within, or in
any way deface any part of the Building, without the prior written consent of
Landlord and as Landlord may direct. Should Landlord grant approval, Tenant
agrees to assume full responsibility and warrants that, should a contractor
other than the Building Contractor be used, Tenant’s contractor will strictly
abide by Landlord’s guidelines for work contracted directly by Tenant. Upon
removal of any wall decorations or installations or floor coverings by Tenant,
any damage to the walls or floors shall be repaired by Tenant at Tenant’s sole
cost and expense. This rule shall apply to all work performed in the Building,
electrical devices, and attachments, and installations of any nature affecting
floors, walls, woodwork, trim, windows, ceilings, equipment, or any other
portion of the Building. Plans and specifications for such work, prepared at
Tenant’s sole expense, shall be submitted to Landlord and shall be subject to
Landlord’s prior written approval in each instance before the commencement of
work. All installations, alterations, and additions shall be constructed by
Tenant in a good and workmanlike manner, and only good grades of materials shall
be used in connection therewith.

 

12. Tenant will not place objects on window sills or otherwise obstruct the
exterior wall window covering.

 

13. The Tenant will keep all doors opening to the exterior of the Building, all
fire doors, and all smoke doors closed at all times.

 

14. If Tenant uses the Premises after regular business hours or on non-business
days Tenant shall lock any entrance doors to the Building or to the Premises
used by Tenant immediately after using such doors.

 

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15. The Tenant shall not use any portion of the Premises for lodging.

 

16. Landlord reserves the right to exclude or expel from the Building any person
who, in the judgement of Landlord is intoxicated or under the influence of
liquor or drugs, or who shall in any manner do any act in violation of any of
the rules and regulations of the Building.

 

17. Tenant shall not park or attach any bicycle or motor driven cycle on or to
any part of the Premises, the Building, or within the landscaping.

 

18.

In all carpeted areas where desks and chairs are utilized, Landlord shall
require Tenant, at Tenant’s own cost, to place mats under each and every chair
or use chairs on 1 1/2” wide rollers at minimum in order to protect said
carpeting from unnecessary wear and tear.

 

19. Signs, advertisements, graphics, or notices visible in or from public
corridors shall be subject to Landlord’s written approval. Nails, screws, and
other attachments to the Building require prior written consent from Landlord.

 

20. Landlord shall be notified in writing in advance of any and all contractors
and technicians rendering any installation service to Tenant, and such
contractors and technicians shall be referred to Landlord for approval and
supervision prior to performing services. This applies to all work performed in
the Building, including installation of telephone and communications lines and
equipment, electrical devices, and all installations affecting floors, walls,
woodwork, windows, ceilings, and any other physical portions of the Building.

 

21. Landlord shall be notified in writing in advance of any movement in or out
of the Building of furniture, office equipment, or other bulky or heavy material
which requires the use of elevators, stairways, or Building entrance and lobby;
and such movement shall be restricted to hours established by Landlord and any
other requirements of Landlord, including the use of elevator pads and the
placement of masonite panel on the path of travel to protect flooring. All such
movement shall be under Landlord’s supervision, and the use of an elevator for
such movements shall be restricted to the Building’s freight elevators.
Arrangements with Landlord should be made regarding the time, method, and
routing of movement, and Tenant shall assume all risks of damage to articles
moved and injury to persons or public resulting from such moves. Landlord shall
not be liable for any acts or damages resulting from any such activity.

 

22.

Landlord reserves the right to restrict access to all telephone closets,
cabling, conduits, and risers in the Property. Tenant shall not have access for
any reason to any of the aforementioned areas of the Property without the
written permission of Landlord and the supervision of Landlord’s Building
Engineer. The means by which

 

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telephone, telegraph, and similar wires are to be introduced to the Premises and
the location of telephones, call boxes, and other office equipment affixed to
the Premises, shall be subject to the prior written approval of Landlord.

 

23. Any damage done to the Building by the movement of Tenant’s property, or
done by Tenant’s property while in the Building, shall be repaired at Tenant’s
expense.

 

24. All door pertinent to Tenant’s Premises and all other Building door outside
the Premises (other than smoke or heat-activated fire doors) are to be kept
closed and not blocked open at all times, as they are fire control doors.

 

25. Tenant shall cooperate with Landlord in maintaining the Premises. Tenant
shall not employ any person for the purpose of such cleaning other than the
Building’s cleaning and maintenance personnel.

 

26. To insure orderly operation of the Building, no deliveries of water, soft
drinks, newspapers, or other such items to any Premises shall be made except by
persons appointed or approved by Landlord in writing.

 

27. Nothing shall be swept or thrown into the corridors, halls elevator shafts,
or stairways. No birds, fish, or animals of any kind shall be brought into or
kept in, on, or about the Premises without the written permission of Landlord.

 

28. No machinery of any kind, except for standard electronic office machinery
such as personal computers, typewriters, and photocopiers, shall be operated by
Tenant in the Premises without the prior written approval of the Landlord.

 

29. No cooking shall be done in the Premises, except that the use by Tenant of
Underwriter’s Laboratory approved microwave ovens and equipment for brewing
coffee, tea, or other hot beverages shall be permitted, provided such use is in
accordance with all applicable codes, laws, and ordinances.

 

30. Tenant shall not install any food, soft drink, or other vending machine
within the Premises.

 

31. Tenant shall not use or keep on its Premises any kerosene, gasoline, or
inflammable or combustible fluid or material other than limited quantities
reasonably necessary for the operation and maintenance of office equipment.
Tenant shall not use or keep any noxious gas or substances in the Premises or
permit the Premises to be used in a manner offensive or objectionable to
Landlord or other occupants of the Building by reason of noise, odors, or
vibrations, or interfere in any way with other Tenants or those having business
therein.

 

32. Tenant shall not tamper with or attempt to adjust temperature control
thermostats in the Premises. Landlord shall make adjustments in thermostats on
call from Tenant.

 

Oyster Point Marina Plaza Rules & Regulations

page C-4 of 5

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33. Tenant shall comply with all measures instituted by Landlord in its sole and
absolute discretion for the security of the Premises, Property, and Complex, and
all personnel using the same, including the use of service passes issued by
Landlord for after-hours movement of office equipment or packages and signing a
security register in Building lobby after hours. Nothing herein shall be
construed to impose any obligation or requirement that Landlord provide any
security services in the Premises, Property, or Complex, or any particular level
or type of security services.

 

34. Landlord will initially furnish Tenant with a reasonable number of keys for
entrance doors into the Premises and may charge Tenant for additional keys
thereafter. All such keys shall remain the property of Landlord. No additional
locks are allowed on any door of the Premises. At termination of this Lease,
Tenant shall surrender to Landlord all keys to the Premises and give to Landlord
the combination of all locks for safes and vault doors, if any, in the Premises.

 

35. Landlord retains the right, without notice or liability to any Tenant, to
change the name and street address of the Building.

 

36. Canvassing, peddling, soliciting, and distribution of handbills in the
Building are prohibited, and Tenant will cooperate to prevent these activities.

 

37. The Building hours of operation (excluding Holidays) are:

 

8:00 a.m. to 6:00 p.m.

   Monday through Friday   

9:00 a.m. to 1:00 p.m.

   Saturday   

 

38. Landlord reserves the right to rescind any of these Rules and regulations
and to make future Rules and regulations required for the safety, protection,
and maintenance of the Building, the operation and preservation of good order
thereof, and the protection and comfort of the tenants and their employees and
visitors. Such Rules and regulations and all modifications thereto shall, upon
written notice, be binding as if originally included herein.

*****

 

Oyster Point Marina Plaza Rules & Regulations

page C-5 of 5

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[Exhibit D]

OYSTER POINT MARINA PLAZA

Athletic Facility Use Agreement & Release of Liability

THIS IS A LEGALLY BINDING AGREEMENT. READ IT CAREFULLY.

I,                                         , hereby acknowledge that my use of
the exercise facility (the “Facility”) at      Oyster Point Boulevard, owned by
KASHIWA FUDOSAN AMERICA, INC. (“Landlord”), as well as any activities in which I
may engage in conjunction with my use of the Facility, is entirely voluntary.

I AM AWARE THAT PARTICIPATING IN ATHLETIC ACTIVITIES AND THE USE OF THE EXERCISE
FACILITY MAY BE HAZARDOUS AND THAT IT IS NOT POSSIBLE FOR LANDLORD TO GUARANTEE
THAT OTHER PATRONS USING THE FACILITY WILL COMPLY WITH ALL ESTABLISHED RULES AND
REGULATIONS. I AM VOLUNTARILY PARTICIPATING IN THESE ATHLETIC ACTIVITIES AND
UTILIZING THE FACILITY WITH FULL KNOWLEDGE OF THE DANGER INVOLVED. I HEREBY
AGREE TO ACCEPT AND ASSUME ANY AND ALL RISKS OF PROPERTY LOSS, PERSONAL INJURY,
OR DEATH, WHETHER OR NOT CAUSED BY THE NEGLIGENCE OF LANDLORD, LANDLORD’S
EMPLOYEES OR AGENTS, OR ANY OTHER PATRON OR GUEST USING THESE FACILITIES.

 

 

[initial here]

In exchange, as lawful consideration for being permitted by Landlord to
participate in activities on Landlord’s property and use its exercise Facility,
I hereby agree that I, my heirs, next of kin, successors, and assigns will not
sue, make a claim against, attach the property of or prosecute Landlord or
Landlord’s agents and employees for injury, death, or damage resulting from the
negligence or other acts, howsoever caused, by any of Landlord’s employees,
agents, contractors, or patrons as a result of my participation in these
activities or use of the exercise Facility. In addition, I hereby release and
discharge Landlord from all actions, claims, or demands that I, my heirs, next
of kin, successors, or assigns now have or may hereafter have for any loss of
property, personal injury, death, or damage resulting from my participation in
these activities or use of the facilities.

I HAVE CAREFULLY READ THIS AGREEMENT AND FULLY UNDERSTAND ITS CONTENTS. I AM
AWARE THAT THIS IS A LEASE OF LIABILITY AND A CONTRACT BETWEEN MYSELF AND
LANDLORD AND SIGN IT OF MY OWN FREE WILL.

 

Participant:   

 

     

 

     

[name typed or printed]

   Tenant:   

 

   Suite:                                                

Executed at South San Francisco on  

 

  .

WITNESS

I certify that the person whose signature appears above acknowledged in my
presence that he or she has read and fully understands the meaning and
consequences of the foregoing Agreement and Release of Liability and the he or
she signed it in my presence.

 

Witness:   

 

     

 

     

[name typed or printed]

  

Date:   

 

  

 

  WARNING: USE OF STEROIDS TO INCREASE STRENGTH OR GROWTH CAN CAUSE SERIOUS
HEALTH PROBLEMS. STEROIDS CAN KEEP TEENAGERS FROM GROWING TO THEIR FULL HEIGHT,
THEY CAN ALSO CAUSE HEART DISEASE, STROKE, AND DAMAGED LIVER FUNCTION. MEN AND
WOMEN USING STEROIDS MAY DEVELOP FERTILITY PROBLEMS, PERSONALITY CHANGES, AND
ACNE. MEN CAN ALSO EXPERIENCE PREMATURE BALDING AND DEVELOPMENT OF BREAST
TISSUE. THESE HEALTH HAZARDS ARE IN ADDITION TO THE CIVIL AND CRIMINAL PENALTIES
FOR UNAUTHORIZED SALE, USE, OR EXCHANGE OF ANABOLIC STEROIDS. California Civil
Code § 1812.67   

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[EXHIBIT E]

OYSTER POINT MARINA PLAZA

Lease Commencement Date Agreement

THIS LEASE COMMENCEMENT DATE AGREEMENT (the “Agreement”) is made as of
                                        , between KASHIWA FUDOSAN AMERICA, INC.,
a California corporation (“Landlord”) and
                                        , a
                                         (“Tenant”).

Tenant and Landlord acknowledge and agree as follows:

1. Tenant has received a fully-executed counterpart of the Lease dated as of
                                         for premises commonly known as Suite
             at          Oyster Point Boulevard in the Oyster Point Marina Plaza
business part.

2. The Commencement Date of the Lease for all purposes thereunder is
                                , 2        , and the Expiration Date is
                                , 2        .

3. Tenant-acknowledges and agrees that, in executing this Agreement, TAK
Development, Inc., a California corporation, is acting solely in its capacity as
Landlord’s authorized attorney-in-fact. TAK Development, Inc. is not acquiring
or assuming any legal liability or obligation to any other party executing this
Agreement or the Lease, and any claim or demand of any such other party arising
under or with respect to this Agreement or the Lease shall be made and enforced
solely against Landlord.

IN WITNESS WHEREOF, Landlord and Tenant have executed this Agreement as of the
date first above written.

 

Landlord:       Tenant:

KASHIWA FUDOSAN AMERICA, INC.,

a California corporation

     

                                                                      ,   a  
                                                                      

                                                                      

        By:    TAK Development, Inc., a California corporation       By:   

 

        Its:    Attorney-in-fact         

 

              

[name typed]

        By:   

 

      Its:   

 

   Toru Iwai, Vice President         

 

   Oyster Point Marina Plaza Commencement Date Agreement       Kashiwa Fudosan
America, Inc. ::                                                                
page E-1    [Suite      (    rsf)]

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[Exhibit F]

OYSTER POINT MARINA PLAZA

Landlord Performance, Turnkey Deal

Construction Documents Completed

Work Letter Agreement

THIS WORK LETTER AGREEMENT (the “Agreement”) is made as of May 15, 2007, between
KASHIWA FUDOSAN AMERICA, INC., a California corporation (“Landlord”) and
NOVACEA, INC., a Delaware corporation (“Tenant”).

RECITALS

A. Landlord and Tenant have entered into a lease dated as of May 15, 2007 (the
“Lease”) for premises known as Suite 200 (the “Premises”), located in the
building known as 400 Oyster Point Boulevard (the “Building”) in the Oyster
Point Marina Plaza, South San Francisco, California.

B. The parties have agreed pursuant to the Lease that the Premises will be
improved for Tenant’s occupancy in the manner and on the terms and conditions
specified herein.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual terms and conditions contained in
the Lease and herein, and in consideration of other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:

1 THE WORK. The “Work” herein shall consist of the improvements shown on the
plans (“Plans”) referenced as follows, and any demolition or preparation work
required in connection therewith:

 

  (A) ARCHITECT OR SPACE PLANNER:

TSH INTERNATIONAL

Attn: Niles Tanakasubo

25 Edwards Court, Suite 208

Burlingame, CA 94010

(650) 373-0128 (O)

(650) 373-0127 (F)

 

  (B) CAPTION OF PLANS:                                         .

 

  (C) NUMBER OF SHEETS:                             .

 

  (D) DATES OF PLANS AND REVISIONS:                                          .

The terms Plans, Work, Space Plan, Construction Documents, Finish Selections,
and Landlord’s Space Planner are defined in ¶ 14 below, below.

2 BASIC TERMS. The following are the basic terms of this Agreement:

 

  (A) DATE TO COMPLETE PLANNING. The Date of Complete Planning will be April 30,
2007 (including any Space Plan, Construction Documents, and Finish Selections).

 

  (B) SUBSTANTIAL COMPLETION DATE. The Substantial Completion Date of the Work
shall be the Commencement Date under the Lease.

 

   Oyster Point Marina Plaza Work Letter Agreement       Kashiwa Fudosan
America, Inc. :: Novacea, Inc.       page E-1 of 7    [Suite 200]

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  (C) SPACE PLAN REVISIONS. Landlord will provide one (1) space plan revisions
(including revisions prior hereto) at Landlord’s Cost, provided that Landlord’s
cost for Space Plans shall not exceed in the aggregate One Dollar ($1.00) per
rentable square foot of the Premises (including the cost of the initial set of
Space Plans and all revisions).

 

  (D) CONSTRUCTION DOCUMENTS REVISIONS. Landlord will provide one (1) revisions
of the Construction Documents (including revisions prior hereto) at Landlord’s
Cost, provided that Landlord’s cost for Construction Documents shall not exceed
in the aggregate One Dollar ($1.00) per square rentable foot of the Premises
(including the cost of the initial set of Construction Documents and all
revisions).

3 BASIC AGREEMENT. The following terms constitute the parties’ basic agreement
with respect to the parties’ responsibility for (a) the construction of the Work
and (b) payment of the cost of the Work:

3.1 COMPLETION OF PLANS. On or before the Date To Complete Planning described
above, Tenant shall (a) provide Space Planner with all information concerning
Tenant’s requirements in order for Space Planner to prepare the Plan,
(b) arrange for Space Planner to prepare the Plans, and (c) obtain Landlord’s
written approval of the Plans. Tenant shall not be responsible for delays caused
by Landlord or Landlord’s Space Planner, as further described in ¶ 4 below. Upon
completion the Plans shall be initialed by the parties and attached hereto as
Schedule 1.

3.2 COMPLETION OF WORK. On or before the Commencement Date under the Lease,
Landlord shall substantially complete the Work shown on the final approved
Plans. However, Landlord shall not be responsible for delays caused by Tenant or
Tenant’s contractors, agents, or employees and as further described in ¶ 5
below.

3.3 COST OF THE PLANS. Landlord shall bear the cost of the Plans (including any
engineering reports or other studies or tests in connection therewith, but
excluding any furniture planning) up to the amounts specified above, provided
that such amounts shall be reduced by ten percent (10%) if Tenant does not use
Landlord’s Space Planner to prepare the Plans; and Tenant shall bear any costs
of the Plans which exceed such amounts.

3.4 COST OF THE WORK. Landlord shall bear the cost of the Work (including the
cost of building permits and sales tax) as shown on the final approved Plans,
and Tenant shall bear any costs incurred in connection with any work it may
desire in addition to that shown on the final approved Plans. The parties agree
that the value of the Work shown on the final approved Plans shall not exceed
One Million Sixty-Two Thousand Ninety-Six Dollars ($1,062,096.00).

4 DELAYS IN PLANNING. The Commencement Date under the Lease shall be postponed
for each day that final Plans are not prepared and approved by the Date to
Complete Planning described above, including any revisions reasonably required
by Landlord pursuant to ¶ 6 below and revisions by Tenant to reduce Tenant’s
Cost pursuant to ¶ 9 below (collectively called “Delays in Planning”). However,
the commencement of Rent shall be postponed only to the extent that substantial
completion of the Work is delayed beyond the Commencement Date as a result of
one or more of the following events (collectively called “Landlord Delays”):

 

  (A) DELAY IN APPROVAL OF PLANS. Landlord takes more than seven (7) working
days to approve or disapprove the Plans or revisions thereof after receiving the
same (or such longer time as may be reasonably required in order to obtain any
engineering or HVAC report or due to other special or unusual features of the
Work or Plans);

 

  (B)

DELAY OF SPACE PLANNER. Landlord’s Space Planner takes more than seven
(7) working days to meet with Tenant after receiving a written request for a
meeting or takes more than

 

   Oyster Point Marina Plaza Work Letter Agreement       Kashiwa Fudosan
America, Inc. :: Novacea, Inc.       page E-2 of 7    [Suite 200]

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seven (7) working days to prepare or revise the Plans after meeting with Tenant
and receiving all information from Tenant required in order to do so, provided
that this provision shall apply only if Tenant uses Landlord’s Space Planner (as
described in ¶ 14 below below) to prepare the Plans; or

 

  (c) DELAY OF COST ESTIMATES. Landlord takes more than thirty (30) working days
to provide Tenant with cost estimates after receiving Plans sufficiently
detailed for such purposes, provided that this ¶ 4(c) shall only apply if
Landlord elects to provide cost estimates under ¶ 9 below.

5 DELAYS IN CONSTRUCTION. The Commencement Date under the Lease shall be
postponed for each day that Landlord fails substantially to complete the Work as
a result of strikes, acts of God, shortages of materials or labor, delays in
obtaining governmental approvals or requirements, the various causes set forth
below, or any other causes beyond Landlord’s reasonable control. In such case,
the commencement of Rent shall be similarly postponed, except to the extent that
delays occur as a result of one or more of the following (collectively called
“Tenant Delays”):

 

  (A) TENANT DELAYS IN PLANNING. Delays in Planning as described above (except
for Landlord Delays);

 

  (B) TENANT CHANGE ORDERS. Tenant’s request for changes to the Work or Change
Orders under ¶ 8 or otherwise;

 

  (C) FAILURE TO FURNISH TENANT’S COST. Tenant’s failure to furnish an amount
equal to Landlord’s reasonable estimate of Tenant’s Cost (if any) within ten
(10) days, as described in ¶ 9 below, which failure shall give Landlord the
absolute right to postpone the Work until such amount is furnished to Landlord;

 

  (D) SPECIALTY ITEMS. Any upgrades, special work, or items not customarily
provided by Landlord to office tenants, to the extent that the same involve
longer lead times, installation times, delays, or difficulties in obtaining
building permits, requirements for any governmental approval, permit, or action
beyond the issuance of normal building permits (as described in ¶ 7), or other
delays not typically encountered in connection with Landlord’s standard office
improvements;

 

  (E) TENANT’S PERFORMANCE OF WORK. The performance by Tenant or Tenant’s
contractors, agents, or employees of any work at or about the Premises or
Building; or

 

  (F) TENANT’S FAULT OR NEGLIGENCE. Any act or omission of Tenant or Tenant’s
contractors, agents, or employees, or any breach by the Tenant of any provisions
contained in the Agreement or in the Lease, or any failure of Tenant to
cooperate with Landlord or otherwise act in good faith in order to cause the
Work to be designed and performed in a timely manner.

6 LANDLORD’S APPROVAL OF PLANS. Landlord shall either approve any Plans or
revisions submitted pursuant to this Agreement or disapprove the same with
suggestions for making the same acceptable within the time required under ¶ 4
above. Landlord shall not unreasonably withhold approval, if the Plans provide
for a customary office layout, with finishes and materials generally conforming
to Building-standard materials currently being used by Landlord at the Building,
are compatible with the Building’s shell and core construction, and if no
modifications will be required for the Building electrical, heating,
air-conditioning, ventilation, plumbing, fire protection, life safety, or other
systems or equipment, and will not require any structural modifications to the
Building, whether required by heavy loads or otherwise. Landlord may request
that Tenant approve Landlord’s suggested changes in writing (such approval shall
not be

 

   Oyster Point Marina Plaza Work Letter Agreement       Kashiwa Fudosan
America, Inc. :: Novacea, Inc.       page E-3 of 7    [Suite 200]

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unreasonably withheld), or Landlord may arrange directly with Space Planner for
revised Plans to be prepared incorporating such suggestions; and in any such
case, Tenant shall sign or initial the revised Plans and/ or Landlord’s notice
concerning the suggested changes, if requested by Landlord. Landlord’s approval
of the Plans shall not be deemed a warranty as to the adequacy or legality of
the design, and Landlord hereby disclaims any responsibility or liability for
the same.

7 GOVERNMENTAL APPROVAL OF PLANS. Landlord shall apply for any normal building
permits required for the Work which are issued pursuant to a local building code
as a ministerial matter. If the Plans must be revised in order to obtain such
building permits, Landlord shall promptly notify Tenant. In such case, Tenant
shall promptly arrange for the Plans to be revised to satisfy the building
permit requirements and shall submit the revised Plans to Landlord for approval
as a Change Order under ¶ 8. Landlord shall have no obligation to apply for any
zoning, parking, or sign code amendments, approvals, permits, or variances, or
any other governmental approval, permit, or action other than normal building
permits, as described above. If any such other matters are required, Tenant
shall promptly seek to satisfy such requirements or revise the Plans to
eliminate such requirements. Delays in substantially completing the Work by the
Commencement Date as a result of requirements for building permits or other
governmental approvals, permits, or actions shall affect the Commencement Date
and commencement of Rent to the extent provided in ¶ 5, except that any delays
in obtaining normal building permits as a result of errors or omissions of
Landlord’s Space Planner in preparing the Plans shall postpone the commencement
of Rent to the extent that substantial completion of the Work is delayed thereby
beyond the Commencement Date; and Tenant shall not be obligated to bear the cost
of Plan revisions to correct the same, notwithstanding anything to the contrary
contained in this Agreement.

8 CHANGES AFTER PLANS ARE APPROVED. If Tenant shall desire any changes,
alternations, or additions to the final Plans after they have been approved by
Landlord, Tenant shall submit a detailed written request or revised Plans (the
“Change Order”) to the Landlord for approval. If reasonable and practicable and
generally consistent with the Plans theretofore approved, Landlord shall not
unreasonably withhold approval; but all costs in connection therewith, including
construction costs, permit fees, and any additional plans, drawings, engineering
reports, or other studies or tests, or revisions of such existing items, shall
be paid for by Tenant as a Tenant’s Cost under ¶ 9.1.

9 TENANT’S COST; ESTIMATES (IF APPLICABLE). Any amounts that Tenant is required
to pay under this Agreement shall be referred to as “Tenant’s Cost” herein.
Tenant’s Cost shall be deemed additional “Rent” under the Lease. Landlord may at
any time reasonably estimate Tenant’s Cost in advance, in which case, Tenant
shall deposit such estimated amount with Landlord within ten (10) days after
requested by Landlord. If such estimated amount exceeds the actual amount of
Tenant’s Cost, Tenant shall receive a refund of the difference; and if the
actual amount shall exceed the estimated amount, Tenant shall pay the difference
to Landlord within ten (10) days after requested by Landlord.

9.1 Request For Cost Estimate. In connection with submitting any Plans to
Landlord for approval, Tenant may request that Landlord obtain a written
estimate from Landlord’s contractor concerning Tenant’s Cost. Landlord shall not
have an obligation to obtain such estimates. However, if Landlord elects to
obtain such estimates, and if any such estimates are unacceptable to Tenant,
Tenant may eliminate or substitute items in order to reduce the estimated
Tenant’s Cost in connection with preparing a revised version of the Plans.

9.2 Tenant’s Approval of Cost Estimate. In connection with submitting any cost
estimates to Tenant under this ¶ 9.2, Landlord may request Tenant’s written
approval of such estimates. Tenant shall not unreasonably withhold such approval
and shall approve or disapprove the same in writing within five (5) days after
requested by Landlord. If Tenant reasonably disapproves any such estimate,
Tenant shall meet with the Space Planner and eliminate or substitute items in
order to reduce Tenant’s Cost as described in the preceding paragraph.

 

   Oyster Point Marina Plaza Work Letter Agreement       Kashiwa Fudosan
America, Inc. :: Novacea, Inc.       page E-4 of 7    [Suite 200]

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9.3 Preliminary Cost Estimates. Any cost estimates based on a Space Plan or
so-called “pricing plan” will be preliminary in nature and may not be relied on
by Tenant. However, Landlord agrees that any written estimate of Tenant’s Cost
based on the approved Construction Documents will not be exceeded by more than
twenty percent (20%), except to the extent that (a) Tenant thereafter makes
changes in the Construction Documents or the Work; (b) overtime labor is
required in order substantially to complete the Work by the Work Completion
Date; (c) concealed conditions are encountered on the job site; (d) new legal
requirements become effective following preparation of the estimate; or
(e) there are strikes, acts of God, shortages of materials or labor, or other
causes beyond Landlord’s reasonable control.

10 SUBSTANTIAL COMPLETION. The term substantial completion and its various
inflections as used herein shall mean that Landlord has caused all of the Work
to be completed substantially, except for so-called “punchlist items”; e.g.,
minor details of construction or decoration or mechanical adjustments which do
not substantially interfere with Tenant’s occupancy or beneficial enjoyment of
the Premises for their intended purposes or Tenant’s ability to complete any
improvements to the Premises to be made by Tenant. If there is any dispute as to
whether Landlord has substantially completed the Work, the good faith decision
of Landlord’s Space Planner shall be final and binding on the parties.

10.1 Notice of Substantial Completion. If Landlord notifies Tenant in writing
that the Work is substantially completed, and Tenant fails to object thereto in
writing within seven (7) days thereafter specifying in reasonable detail the
items of work needed to be performed in order to achieve substantial completion,
Tenant shall be deemed conclusively to have agreed that the Work is
substantially completed, for purposes of commencing the Commencement Date and
Rent under the Lease.

10.2 Final Completion. Substantial completion shall not prejudice Tenant’s
rights to require full completion of any remaining items of Work. However, if
Landlord notifies Tenant in writing that the Work is fully completed, and Tenant
fails to object thereto in writing within fifteen (15) days thereafter
specifying in reasonable detail the items of work needed to be completed and the
nature of work needed to complete said items, Tenant shall be deemed
conclusively to have accepted the Work as fully completed (or such portions
thereof as to which Tenant has not so objected).

10.3 Substitution of Materials. Landlord reserves the right to substitute
comparable or better materials and items for those shown in the Plans, so long
as they do not materially and adversely affect the appearance of the Premises.

11 WORK PERFORMED BY TENANT. Landlord, at Landlord’s discretion, may permit
Tenant and Tenant’s agents and contractors to enter the Premises prior to
completion of the Work in order to make the Premises ready for Tenant’s use and
occupancy. If Landlord permits such entry prior to completion of the Work, then
such permission is conditioned upon Tenant and Tenant’s agents, contractors,
workmen, mechanics, suppliers, and invitees working in harmony and not
interfering with Landlord and Landlord’s contractors in doing the Work or with
other tenants and occupants of the Building. If at any time such entry shall
cause or threaten to cause such disharmony or interference, Landlord shall have
the right to withdraw such permission upon twenty-four (24) hours’ oral or
written notice to Tenant. Tenant agrees that any such entry into the Premises
shall be deemed to be under all of the terms, covenants, conditions, and
provisions of the Lease (including, without limitation, all insurance
requirements), except as to the covenant to pay Rent thereunder, and further
agrees that Landlord shall not be liable in any way for any injury, loss, or
damage which may occur to any items of work constructed by Tenant or to other
property of Tenant that may be placed in the Premises prior to completion of the
Work, the same being at Tenant’s sole risk.

12 LIABILITY. The parties acknowledge that Landlord is not an architect or
engineer and that the Work will be designed and performed by independent
architects, engineers, and contractors. Accordingly, Landlord does not guarantee
or warrant that the Plans will be free from errors or omissions, nor that the
Work will be

 

   Oyster Point Marina Plaza Work Letter Agreement       Kashiwa Fudosan
America, Inc. :: Novacea, Inc.       page E-5 of 7    [Suite 200]

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free from defects; and Landlord shall have no liability therefor, provided that
such architects, engineers, and contractors are licensed and reputable (except
as provided in ¶ 7 above). In the event of such errors, omissions, or defects,
Landlord shall cooperate in any action Tenant desires to bring against such
parties.

13 CERTAIN DEFINITIONS. The following terms shall bear the definitions assigned
them below for all purposes under this Agreement:

 

  (A) WORK. Work herein means the construction of the improvements shown on the
final approved Plans, and any demolition, preparation, or other work required in
connection therewith, including, without limitation, any work required to be
performed outside the Premises in order to obtain building permits for the work
to be performed within the Premises (if Landlord elects to perform such work
outside the Premises).

 

  (B) LANDLORD’S SPACE PLANNER. Landlord’s Space Planner herein means the space
planner (if any) regularly used by Landlord and with whom Landlord has a written
contractual arrangement for space planning services at the Building.

 

  (C) LANDLORD’S CONTRACTOR. Landlord’s Contractor herein means the contractor
(if any) regularly used by Landlord and with whom Landlord has a written
contractual arrangement for construction services at the Building.

 

  (D) FINISH SELECTIONS. Finish Selections herein means the type and color of
floor and wall coverings, wall paint and any other finishes.

 

  (E) PLANS. Plans herein means, collectively, any Space Plan, Construction
Documents, or other plans, drawings, or specifications, and Finish Selections
(and in the event of any inconsistency between any of the same, or revisions
thereto, the latest dated item approved by Landlord shall control). The Plans
shall be signed or initialed by Tenant, if requested by Landlord, and any
Construction Documents shall include at least three (3) mylar sepias (or such
other quantity as Landlord may reasonably require).

 

  (F) SPACE PLAN. Space Plan herein means a preliminary floor plan, generally
showing demising walls, corridor doors, interior partition walls, and interior
doors. The term Space Plan for purposes of this Agreement shall also refer to
any so-called “pricing plan”; i.e., a more detailed Space Plan, drawn to scale,
showing: (1) any special walls, glass partitions, or corridor doors; (2) any
restrooms, kitchens, computer rooms, file rooms, and other special purpose
rooms, and any sinks or other plumbing facilities, or other special facilities
or equipment; (3) communications system, indicating telephone and computer
outlet locations; and (4) any other details or features reasonably required in
order to obtain a preliminary cost estimate as described in ¶ 10, above, or
otherwise reasonably requested by Landlord or Landlord’s Space Planner.

 

  (G)

CONSTRUCTION DOCUMENTS. Construction Documents herein means fully dimensioned
architectural construction drawings and specifications, and any required
engineering drawings (including mechanical, electrical, plumbing,
air-conditioning, ventilation, and heating), and shall include any applicable
items described above for the Space Plan, and if applicable: (i) electrical
outlet locations, circuits, and anticipated usage therefor; (ii) reflected
ceiling plan, including lighting, switching, and any special ceiling
specifications; (iii) duct locations for heating, ventilating, and
air-conditioning equipment; (iv) details of all millwork; (v) dimensions of all
equipment and cabinets to be built in; (vi) furniture plan showing details of
space occupancy; (vii) keying schedule; (viii) lighting arrangement;
(ix) location of print machines, equipment in lunch rooms, concentrated file and
library loadings, and any other equipment or systems (with brand names wherever
possible) which require special

 

   Oyster Point Marina Plaza Work Letter Agreement       Kashiwa Fudosan
America, Inc. :: Novacea, Inc.       page E-6 of 7    [Suite 200]

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consideration relative to air-conditioning, ventilation, electrical, plumbing,
structural, fire protection, life—fire-safety system, or mechanical systems;
(x) special heating, ventilating, and air conditioning equipment and
requirements; (xi) weight and location of heavy equipment, and anticipated loads
for special usage rooms; (xii) demolition plan; (xiii) partition construction
plan; (xiv) Finish Selections, and any other details or features reasonably
required in order to obtain a more firm cost estimate as described in ¶ 10,
above, or otherwise reasonably requested by Landlord or Landlord’s Space
Planner.

14 TAXES. Tenant shall pay prior to delinquency all taxes, charges, or other
governmental impositions (including without limitation, any real estate taxes or
assessments, sales tax, or value added tax) assessed against or levied upon
tenant’s fixtures, furnishings, equipment, and personal property located in the
Premises and the Work to the Premises under this Agreement. Whenever possible,
Tenant shall cause all such items to be assessed and billed separately from the
property of Landlord. In the event any such items shall be assessed and with the
property of Landlord, Tenant shall pay its share of such taxes, charges, or
other governmental impositions to Landlord within thirty (30) days after
Landlord delivers a statement and a copy of the assessment or other
documentation showing the amount of such impositions applicable to Tenant.

15 LANDLORD’S REPRESENTATIVE. Tenant acknowledges and agrees that, in executing
this Work Letter Agreement, TAK Development, Inc., a California corporation, is
acting solely in its capacity as Landlord’s authorized attorney-in-fact. TAK
Development, Inc. is not acquiring or assuming any legal liability or obligation
to any other party executing this Work Letter Agreement, and any claim or demand
of any such other party arising under or with respect to this Work Letter
Agreement shall be made and enforced solely against Landlord.

16 INCORPORATION INTO LEASE; DEFAULT. The parties agree that the provisions of
this Work Letter Agreement are hereby incorporated by this reference into the
Lease fully as though set forth therein. In the event of any express
inconsistencies between the Lease and this Work Letter Agreement, the latter
shall govern and control. Any default by a party hereunder shall constitute a
default by that party under the Lease, and said party shall be subject to the
remedies and other provisions applicable thereto under the Lease.

IN WITNESS WHEREOF, Landlord and Tenant have executed this Agreement as of the
date first-above written.

 

Landlord:       Tenant: KASHIWA FUDOSAN AMERICA, INC., a California corporation
      NOVACEA, INC., a Delaware corporation         By:    TAK Development,
Inc., a California corporation       By:   

/s/ John P. Walker

            John P. Walker             [name typed]         Its:   
Attorney-in-Fact       Its:    INTERIM CEO and Chairman of the Board    By:   

/s/ Toru Iwai

               Toru Iwai, Vice President 6/5/07         

 

   Oyster Point Marina Plaza Work Letter Agreement       Kashiwa Fudosan
America, Inc. :: Novacea, Inc.       page E-7 of 7    [Suite 200]

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[Schedule 1]

[THE PLANS]

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TABLE OF CONTENTS

 

1    BASIC LEASE TERMS    1 2    USE    4 3    PREPARATION OF THE PREMISES    5
4    ADJUSTMENTS OF RENT    7 5    SECURITY DEPOSIT    14 6    COMPLIANCE WITH
LAWS    14 7    HAZARDOUS MATERIALS    15 8    SERVICES AND UTILITIES    17 9   
TENANT’S CHANGES    20 10    TENANT’S PROPERTY    22 11    CONDITION UPON
SURRENDER    23 12    REPAIRS AND MAINTENANCE    24 13    RULES AND REGULATIONS
   24 14    INSURANCE AND INDEMNIFICATION    25 15    DAMAGE AND DESTRUCTION   
29 16    EMINENT DOMAIN    31 17    ASSIGNMENT AND SUBLETTING    31 18   
SUBORDINATION AND ATTORNMENT    37 19    FINANCING REQUIREMENTS    38 20   
DEFAULT    38 21    LIMITATIONS ON LANLORD’S LIABILITY    41 22    ESTOPPEL
CERTIFICATES    41 23    NOTICES    42 24    BROKERS    43 25    RIGHTS RESERVED
TO LANDLORD    43 26    BUILDING PLANNING    44 27    HOLDING OVER    45 28   
PARKING    45 29    MISCELLANEOUS PROVISIONS    46

 

Oyster Point Marina Plaza Lease Table of Contents

page T-1 of 1

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INDEX OF DEFINED TERMS

 

A    Additional Rent    2, 7, 11, 22, 32, 33, 34, 35, 46 Adjustment Period    7,
8, 9, 11, 12, 13 Assumed Base Amount    12 Athletic Facility    3, 10, 50 B   
Base Expense Year    7 Base Operating Expenses    7, 11, 12 Base Real Estate
Taxes    7, 11, 12 Base Rent    1, 2, 7, 11, 13, 19, 29, 30, 32, 33, 34, 35, 38
Base Tax Year    7, 12 Base Utilities    7, 11 Building    1, 3, 4, 5, 7, 8, 9,
10, 12, 17, 18, 19, 20, 21, 22, 24, 26, 28, 30, 32, 33, 35, 36, 37, 42, 43, 44,
45, 49 Business Hours    18 Business Personal Property    25, 26, 27 C    Claims
   27, 28, 34, 42, 43 Code Costs    15 Commencement Date    1, 2, 6, 7, 10, 15,
18, 38, 41, 50 Complex    1, 2, 3, 4, 5, 7, 10, 13, 22, 28, 30, 32, 33, 37, 38,
42, 44, 49 E    Event of Default.    38, 39 Expiration Date    1, 2, 11, 14, 17,
23, 34 F    Force Majeure Delays    50 H    Hazardous Material    15, 16 Holder
   26, 37, 38, 41, 42 Holidays    18, 46 HVAC    16, 17, 19, 20 I   
Improvements    5, 22, 23, 30, 44 INC    1, 4, 5, 17, 18, 20, 24, 28 IW    24 L
   Landlord    1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18,
19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38,
39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51 Laws    5, 10, 14, 15, 16,
17, 18, 21, 22, 24 Lease    i, 1, 2, 3, 4, 5, 6, 7, 8, 10, 11, 12, 13, 14, 15,
16, 17, 18, 20, 22, 23, 24, 25, 26, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38,
39, 40, 41, 42, 43, 44, 45, 46, 47,48, 49, 50, 51 Lessor    26, 37, 38, 42

 

Oyster Point Marina Plaza Lease Table of Defined Terms

Page I-ii of 1

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M    MPOE    17, 18 MSDS    16 O    Occupancy Conditions    6 Operating Expenses
   7, 9, 10, 11, 12, 13, 17, 30 P    Parking Facility    45 Permitted Occupant
   33, 36 Premises    1, 2, 4, 5, 6, 7, 13, 14, 15, 16, 17, 18, 19, 20, 22, 23,
24, 25, 26, 28, 29, 30, 31, 32, 33, 34, 36, 38, 39, 40, 41, 43, 44, 45, 46, 47,
49, 50 Prime Rate    2 Property    2, 3, 4, 5, 7, 8, 9, 10, 11, 13, 15, 16, 17,
18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 35, 37, 38, 39, 41, 42,
43, 44, 46 R    Real Estate Taxes    7, 8, 9, 11, 12, 13 Rent    1, 2, 3, 4, 6,
7, 8, 11, 13, 14, 19, 20, 22, 28, 29, 30, 31, 32, 33, 34, 35, 38, 39, 40, 42,
43, 45, 46, 47, 48 Rental Adjustment    7, 11 Rules    4, 24, 25, 50 S   
Security Deposit    14 State    1, 8, 14, 26, 49 Statement    11, 13 Subsequent
Operating Expenses    12 Successor Landlord    37, 38 Superior Leases    37
Superior Mortgages    10, 37 Systems and Equipment    3, 4, 5, 10, 17, 18, 19,
20, 24, 28, 44 T    Table    1, 2, 6, 7, 45 Takings    31 Temporary Condemnation
   31 Tenant    1, 2, 3, 4, 5, 6, 7, 8, 11, 12,13, 14, 15, 16, 17,18, 19, 20,
21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38,39, 40,
41, 42, 43, 44, 45, 46, 47, 48, 49, 50 Tenant Delays    6 Term    1, 2, 5, 6, 7,
8, 9, 11, 12, 14, 15, 18, 20, 22, 23, 26, 30, 31, 32, 40, 44, 45, 47, 50
Transfer    31, 32, 33, 34, 35, 36, 38, 41 Transfer Notice    32, 33, 34
Transfer Premium    35 U    Utilities    7, 9, 11, 12, 13, 17 W    Work    5, 6,
22, 23, 24, 50

 

Oyster Point Marina Plaza Lease Table of Defined Terms

Page I-iii of 2

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EXHIBIT B

SUBLEASED PREMISES

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LOGO [g77982g48b03.jpg]

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EXHIBIT C

FURNITURE

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SOUTH SAN FRANCISCO INVENTORY—March 6, 2009

 

Room
Description

  

Rm Number

  

Desk Detail

   Desk
Unit    Mahogany
Coffee
Table    40" ×
14" ×
30
Table    18"
Round
Table    42"
Round
Table    36"
Round
Table    48"
Round
Table    Square
36" ×
36"
Table    Folding
72" ×
30"
Table    4 ft
Light
Wood
Table
w/
Lower
Shelf    5 ft.
Dark
Wood
Table

TOTALS:

         48    1    1    1    1    6    4    5    1    1    1 Reception Lobby   
   1—  Set built-in reception desk marble    1    1    1    0    0    0    0   
0    0    0    0 Corner Office    100    Wood Circular w/3 drawer cabinet    1
   0    0    0    0    0    1    0    0    0    0 Side Office    101    Wood
Circular w/2 drawer cabinet    1    0    0    0    0    0    0    0    0    0   
0 Side Office    102    Wood Circular w/2 drawer    1    0    0    0    0    0
   0    0    0    0    0 Cube    Across from #102    Wood Circular w/sm 3 drawer
& lg 2 drawer cabinet    1    0    0    0    0    0    0    0    0    0    0
Side Office    103    Wood Circular w/2 drawer    1    0    0    0    0    0   
0    0    0    0    0 Cube    Across from #103    Circular Desk w/sm 3 drawer   
1    0    0    0    0    0    0    0    0    0    0 Side Office    104    Wood
Circular w/2 drawer    1    0    0    0    0    0    0    0    0    0    0 Cube
   Across from #104    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    1   
0    0    0    0    0    0    0    0    0    0 Side Office    105    Wood
Circular w/2 drawer    1    0    0    0    0    0    0    0    0    0    0 Cube
   Across from #105    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    1   
0    0    0    0    0    0    0    0    0    0 Corner Office    106    Wood
Circular w/3 drawer    1    0    0    0    0    0    1    0    0    0    0 Side
Office    107    Wood Circular w/3 drawer    1    0    0    0    0    0    1   
0    0    0    0    Across from #107    0       0    0    0    0    0    0    0
   0    0    0 Side Office    108    Wood Circular w/2 drawer    1    0    0   
0    0    0    0    0    0    0    0    Across from #108    0       0    0    0
   0    0    0    0    0    0    0 Cube    Across from #108    Wood Circular
w/sm 3 drawer & lg 2 drawer cabinet    1    0    0    0    0    0    0    0    0
   0    0 Side Office    109    Wood Circular w/2 drawer    1    0    0    0   
0    0    0    0    0    0    0 Cube    Across from #109    Wood Circular w/sm 2
drawer    1    0    0    0    0    0    0    0    0    0    0 Side Office    110
   Wood Circular w/2 drawer    1    0    0    0    0    0    0    0    0    0   
0    Across from #110    0       0    0    0    0    0    0    0    0    0    0
Copy Room    Across from #110    0       0    0    0    0    0    0    0    0   
0    0 Side Office    111    Wood Circular w/2 drawer    1    0    0    0    0
   0    0    0    0    0    0 Down Aisle    Across from #111    0       0    0
   0    0    0    0    0    0    0    0 Cube #1    Down Aisle from #111    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    1    0    0    0    0    0    0
   0    0    0    0 Cube #2    Down Aisle from #111    Wood Circular w/2 drawer
cabinet    1    0    0    0    0    0    0    0    0    0    0 Cube #3    Down
Aisle from #111    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    1    0
   0    0    0    0    0    0    0    0    0 Side Office    112    Wood Circular
w/2 drawer    1    0    0    0    0    0    0    0    0    0    0 Side Office   
113    Wood Circular w/2 drawer    1    0    0    0    0    0    0    0    0   
0    0 Cube 1-A Left Side    Down Aisle from #113    Wood Circular w/sm 3 drawer
& lg 2 drawer cabinet    1    0    0    0    0    0    0    0    0    0    0
Cube 1-B Right Side    Down Aisle from #113    Wood Circular w/sm 3 drawer & lg
2 drawer cabinet    1    0    0    0    0    0    0    0    0    0    0 Cube 2-A
Left Side    Down Aisle from #113    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    1    0    0    0    0    0    0    0    0    0    0 Cube 2-B Right
Side    Down Aisle from #113    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    1    0    0    0    0    0    0    0    0    0    0 Cube 3-A Left
Side    Down Aisle from #113    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    1    0    0    0    0    0    0    0    0    0    0 Cube 3-B Right
Side    Down Aisle from #113    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    1    0    0    0    0    0    0    0    0    0    0 Down Aisle   
Across from #113    0       0    0    0    0    0    0    0    0    0    0 Side
Office    114    Wood Circular w/sm 3 drawer    1    0    0    0    0    0    1
   0    0    0    0 Side Office    115    Wood Circular w/sm 3 drawer    1    0
   0    0    0    0    0    0    0    0    0 Cube 1-A Right Side    Down Aisle
from #115    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    1    0    0   
0    0    0    0    0    0    0    0 Cube 1-B Left Side    Down Aisle from #115
   Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    1    0    0    0    0   
0    0    0    0    0    0 Cube 2-A Right Side    Down Aisle from #115    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    1    0    0    0    0    0    0
   0    0    0    0 Cube 2-B Left Side    Down Aisle from #115    Wood Circular
w/sm 3 drawer & lg 2 drawer cabinet    1    0    0    0    0    0    0    0    0
   0    0 Cube 3-A Right Side    Down Aisle from #115    Wood Circular w/sm 3
drawer & lg 2 drawer cabinet    1    0    0    0    0    0    0    0    0    0
   0 Cube 3-B Left Side    Down Aisle from #115    Wood Circular w/sm 3 drawer &
lg 2 drawer cabinet    1    0    0    0    0    0    0    0    0    0    0 Side
Office    116    Wood Circular w/2 drawer    1    0    0    0    0    0    0   
0    0    0    0 Side Office    117    Wood Circular w/2 drawer    1    0    0
   0    0    1    0    0    0    0    0 Conference Room    Across from 117    0
      0    0    0    0    0    0    0    0    0    0 Small V-shaped Room   
117-A    0       0    0    0    0    0    0    0    0    0    0 Conference Room
   Across from 117-A    0       0    0    0    0    0    0    0    0    0    0
Board Room    118    0       0    0    0    0    0    0    0    0    0    0
Reception Area    Across from #118    0       0    0    0    0    0    0    0   
0    0    0 Storage Room    118-A    0       0    0    0    0    0    0    0   
0    0    0 Library    146    0       0    0    0    0    0    0    0    0    1
   1 Hallway    Outside Room #146    0       0    0    0    0    0    0    0   
0    0    0 Central Records Room    147    Gray 5 ft w × 30"       0    0    0
   0    0    0    0    1    0    0 Server Room    148    0       0    0    0   
0    0    0    0    0    0    0 Storage Room    150    0       0    0    0    0
   0    0    0    0    0    0 Store Room    151    0       0    0    0    0    0
   0    0    0    0    0 Store Room    153    0       0    0    0    0    0    0
   0    0    0    0 Store Room    154    0       0    0    0    0    0    0    0
   0    0    0 Store Room    155    0       0    0       1    0    0    0    0
   0    0 Office    156    0       0    0    0    0    0    0    0    0    0   
0 Office    157    0       0    0    0    0    0    0    0    0    0    0
Employee Lounge    158    0       0    0    0    0    1    0    5    0    0    0
Office    159    0       0    0    1    0    0    0    0    0    0    0 Hallway
   Outside #158 & 159    0       0    0    0    0    0    0    0    0    0    0
Office    160    0       0    0    0    0    0    0    0    0    0    0 Sink
Area    Down Aisle from # 160    0       0    0    0    0    0    0    0    0   
0    0 Down Aisle    Side of Office # 160    0       0    0    0    0    0    0
   0    0    0    0 Office    161    0       0    0    0    0    1    0    0   
0    0    0 Cube 1-A Left Side    Down Aisle from # 161    Wood Circular Desk
w/sm 3 drawers    1    0    0    0    0    0    0    0    0    0    0 Cube 1-B
Right Side    Down Aisle from # 161    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    1    0    0    0    0    0    0    0    0    0    0 Cube 2-A Left
Side    Down Aisle from # 161    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    1    0    0    0    0    0    0    0    0    0    0 Cube 2-B Right
Side    Down Aisle from # 161    Wood Circular Desk    1    0    0    0    0   
0    0    0    0    0    0 Office    162    0       0    0    0    0    1    0
   0    0    0    0 Office    163    0       0    0    0    0    0    0    0   
0    0    0 Cube 1-A Left Side    Down Aisle from # 163    Wall to Wall Wooden
Circular desk w/6 sm 3 drawer    1    0    0    0    0    0    0    0    0    0
   0 Cube 1-B Right Side    Down Aisle from # 163    Wood Circular w/sm 3 drawer
& lg 2 drawer cabinet    1    0    0    0    0    0    0    0    0    0    0
Cube 2 Right Side    Down Aisle from # 163    Wood Circular w/sm 3 drawer & lg 2
drawer cabinet    1    0    0    0    0    0    0    0    0    0    0 Down Aisle
   From Side Office #163    0       0    0    0    0    0    0    0    0    0   
0 Office    164    0       0    0    0    0    0    0    0    0    0    0 Office
   165    0       0    0    0    0    1    0    0    0    0    0 Down Aisle   
Across from # 165    0       0    0    0    0    0    0    0    0    0    0
Office    166    0       0    0    0    0    0    0    0    0    0    0 Office
   167    0       0    0    0    0    1    0    0    0    0    0 Office    168
   0       0    0    0    0    0    0    0    0    0    0 Conference Room    169
   0       0    0    0    0    0    0    0    0    0    0 Cubes    Opposite Rms
124, 125, & 126    0       0    0    0    0    0    0    0    0    0    0 Cube
w/ reddish support beam    Near Rm # 127    2 Drawer Wood Built-in Lateral 42"
   1    0    0    0    0    0    0    0    0    0    0 Next To    Emergence Exit
   0       0    0    0    0    0    0    0    0    0    0                     
                 

--------------------------------------------------------------------------------

SOUTH SAN FRANCISCO INVENTORY—March 6, 2009 (Continued)

 

Room Description

  

Rm Number

  

Desk Detail

   8 ft. Wood
Conference
Table    10 ft.
Wood
Conference
Table    12 ft.
Wood
Conference
Table    18 ft.
Mahogany
Table    Executive
Black
Leather
w/Arms    Desk
Chair    Burgundy
Kitchen
Chairs    Wood
Frame
&
Fabric
Seat
Chairs    Guest
Chair    White
Board    2 ft.
2 Drawer
Tan
Metal
File
Cabinet

TOTALS:

         1    0    1    2    15    84    22    4    85    41    5
Reception Lobby       1—  Set built-in reception desk marble    0    0    0    1
   0    1    0    0    0    0    0 Corner Office    100    Wood Circular w/3
drawer cabinet    0    0    0    0    0    1    0    0    5    1    0 Side
Office    101    Wood Circular w/2 drawer cabinet    0    0    0    0    0    1
   0    0    2    1    0 Side Office    102    Wood Circular w/2 drawer    0   
0    0    0    0    1    0    0    2    1    0 Cube    Across from #102    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    1    0
   0    0    0    0 Side Office    103    Wood Circular w/2 drawer    0    0   
0    0    0    1    0    0    2    1    Cube    Across from #103    Circular
Desk w/sm 3 drawer    0    0    0    0    0    1    0    0    0    0    0 Side
Office    104    Wood Circular w/2 drawer    0    0    0    0    0    1    0   
0    0    1    0 Cube    Across from #104    Wood Circular w/sm 3 drawer & lg 2
drawer cabinet    0    0    0    0    0    1    0    0    0    0    0 Side
Office    105    Wood Circular w/2 drawer    0    0    0    0    0    1    0   
0    0    1    0 Cube    Across from #105    Wood Circular w/sm 3 drawer & lg 2
drawer cabinet    0    0    0    0    0    1    0    0    0    0    0 Corner
Office    106    Wood Circular w/3 drawer    0    0    0    0    0    1    0   
0    4    1    0 Side Office    107    Wood Circular w/3 drawer    0    0    0
   0    0    1    0    0    4    1    0    Across from #107    0    0    0    0
   0    0    0    0    0    0    0    0 Side Office    108    Wood Circular w/2
drawer    0    0    0    0    0    1    0    0    2    1    0    Across from
#108    0    0    0    0    0    0    0    0    0    0    0    0 Cube    Across
from #108    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0   
0    0    1    0    0    0    0    0 Side Office    109    Wood Circular w/2
drawer    0    0    0    0    0    1    0    0    2    0    0 Cube    Across
from #109    Wood Circular w/sm 2 drawer    0    0    0    0    0    1    0    0
   0    0    0 Side Office    110    Wood Circular w/2 drawer    0    0    0   
0    0    1    0    0    2    1    0    Across from #110    0    0    0    0   
0    0    0    0    0    0    0    0 Copy Room    Across from #110    0    0   
0    0    0    0    0    0    0    0    0    0 Side Office    111    Wood
Circular w/2 drawer    0    0    0    0    0    1    2    0    2    1    0 Down
Aisle    Across from #111    0    0    0    0    0    0    0    0    0    0    0
   0 Cube #1    Down Aisle from #111    Wood Circular w/sm 3 drawer & lg 2
drawer cabinet    0    0    0    0    0    1    0    0    0    0    0 Cube #2   
Down Aisle from #111    Wood Circular w/2 drawer cabinet    0    0    0    0   
0    1    0    0    0    0    0 Cube #3    Down Aisle from #111    Wood Circular
w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    1    0    0    0
   0    0 Side Office    112    Wood Circular w/2 drawer    0    0    0    0   
0    1    0    0    2    1    0 Side Office    113    Wood Circular w/2 drawer
   0    0    0    0    0    1    0    0    2    1    0 Cube 1-A Left Side   
Down Aisle from #113    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0
   0    0    0    0    1    0    0    0    0    0 Cube 1-B Right Side    Down
Aisle from #113    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0
   0    0    0    1    0    0    0    0    0 Cube 2-A Left Side    Down Aisle
from #113    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0   
0    0    1    0    0    0    0    0 Cube 2-B Right Side    Down Aisle from #113
   Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0   
1    0    0    0    0    0 Cube 3-A Left Side    Down Aisle from #113    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    1    0
   0    0    0    0 Cube 3-B Right Side    Down Aisle from #113    Wood Circular
w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    1    0    0    0
   0    0 Down Aisle    Across from #113    0    0    0    0    0    0    0    0
   0    0    0    0 Side Office    114    Wood Circular w/sm 3 drawer    0    0
   0    0    0    1    0    0    4    1    0 Side Office    115    Wood Circular
w/sm 3 drawer    0    0    0    0    0    1    0    0    4    1    0 Cube 1-A
Right Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    1    0    0    0    0    0 Cube 1-B Left
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    1    0    0    0    0    0 Cube 2-A Right
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    1    0    0    0    0    0 Cube 2-B Left
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    1    0    0    0    0    0 Cube 3-A Right
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    1    0    0    0    0    0 Cube 3-B Left
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    1    0    0    0    0    0 Side Office   
116    Wood Circular w/2 drawer    0    0    0    0    0    1    0    0    2   
1    0 Side Office    117    Wood Circular w/2 drawer    0    0    0    0    0
   1    0    0    3    1    0 Conference Room    Across from 117    0    0    0
   1    0    0    0    0    0    10    1    0 Small V-shaped Room    117-A    0
   0    0    0    0    0    0    0    0    0    0    0 Conference Room    Across
from 117-A    0    0    0    0    0    0    8    0    0    0    1    0 Board
Room    118    0    0    0    0    1    15    0    0    0    0    1    0
Reception Area    Across from #118    0    0    0    0    0    0    0    0    0
   0    0    0 Storage Room    118-A    0    0    0    0    0    0    0    0   
0    0    0    0 Library    146    0    0    0    0    0    0    1    0    0   
4    1    1 Hallway    Outside Room #146    0    0    0    0    0    0    0    0
   0    0    0    0 Central Records Room    147    Gray 5 ft w × 30"    0    0
   0    0    0    3    0    0    0    1    0 Server Room    148    0    0    0
   0    0    0    0    0    0    0    0    0 Storage Room    150    0    0    0
   0    0    0    0    0    0    0    0    0 Store Room    151    0    0    0   
0    0    0    0    0    0    0    0    0 Store Room    153    0    0    0    0
   0    0    0    0    0    0    6    0 Store Room    154    0    0    0    0   
0    0    0    0    0    0    0    0 Store Room    155    0    0    0    0    0
   0    0    0    0    0    0    0 Office    156    0    0    0    0    0    0
   1    0    0    2    1    0 Office    157    0    0    0    0    0    0    1
   0    0    2    1    0 Employee Lounge    158    0    0    0    0    0    0   
0    20    4    0    0    0 Office    159    0    0    0    0    0    0    1   
0    0    1    1    0 Hallway    Outside #158 & 159    0    0    0    0    0   
0    0    0    0    0    0    0 Office    160    0    0    0    0    0    0    1
   0    0    2    1    0 Sink Area    Down Aisle from # 160    0    0    0    0
   0    0    0    0    0    0    0    0 Down Aisle    Side of Office # 160    0
   0    0    0    0    0    0    0    0    0    0    0 Office    161    0    0
   0    0    0    0    1    0    0    3    1    0 Cube 1-A Left Side    Down
Aisle from # 161    Wood Circular Desk w/sm 3 drawers    0    0    0    0    0
   1    0    0    0    0    0 Cube 1-B Right Side    Down Aisle from # 161   
Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    1
   0    0    0    0    0 Cube 2-A Left Side    Down Aisle from # 161    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    1    0
   0    0    0    2 Cube 2-B Right Side    Down Aisle from # 161    Wood
Circular Desk    0    0    0    0    0    1    0    0    0    0    0 Office   
162    0    0    0    0    0    0    1    0    0    4    1    0 Office    163   
0    0    0    0    0    0    1    0    0    2    1    0 Cube 1-A Left Side   
Down Aisle from # 163    Wall to Wall Wooden Circular desk w/6 sm 3 drawer    0
   0    0    0    0    7    0    0    0    0    0 Cube 1-B Right Side    Down
Aisle from # 163    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0
   0    0    0    1    0    0    0    0    0 Cube 2 Right Side    Down Aisle
from # 163    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0
   0    0    1    0    0    0    0    0 Down Aisle    From Side Office #163    0
   0    0    0    0    0    0    0    0    0    0    0 Office    164    0    0
   0    0    0    0    1    0    0    2    1    0 Office    165    0    0    0
   0    0    0    1    0    0    2    1    0 Down Aisle    Across from # 165   
0    0    0    0    0    0    0    0    0    0    0    1 Office    166    0    0
   0    0    0    0    1    0    0    2    1    0 Office    167    0    0    0
   0    0    0    0    0    0    3    1    0 Office    168    0    0    0    0
   0    0    1    0    0    2    1    0 Conference Room    169    0    1    0   
0    0    0    0    0    0    0    1    0 Cubes    Opposite Rms 124, 125, & 126
   0    0    0    0    0    0    7    0    0    0    0    1 Cube w/ reddish
support beam    Near Rm # 127    2 Drawer Wood Built-in Lateral 42"    0    0   
0    0    0    1    0    0    0    0    0 Next To    Emergence Exit    0    0   
0    0    0    0    0    0    0    0    0    0                                 
     

--------------------------------------------------------------------------------

SOUTH SAN FRANCISCO INVENTORY—March 6, 2009 (Continued)

 

Room Description

  

Rm Number

  

Desk Detail

   2 1/2 ft.
2 Drawer
Tan
Metal
File
Cabinet    2
Drawer
Metal
42"
Lateral
File    3 ft. 2
Drawer
Tan
Metal
File
Cabinet    3
Drawer
Gray
Metal
Hanging
File    3 ft.
Gray
Metal
Cabinet
on
Wheels
w/1
Drawer
& 2
Shelves    2
Drawer
Lateral
36"    Steel 2
Drawer
Free-
Standing
Lateral
36"    Free
Standing
File
6'×3'    2
Drawer
Metal
Lateral
free
Standing    3
Drawer
Ped    Wood
2 Drawer
Cabinet

TOTALS:

         6    8    1    3    1    7    4    2    0    13    9 Reception Lobby   
   1—  Set built-in reception desk marble    0    0    0    0    0    0    0   
0    0    0    0 Corner Office    100    Wood Circular w/3 drawer cabinet    0
   0    0    0    0    0    0    0    0    0    1 Side Office    101    Wood
Circular w/2 drawer cabinet    0    0    0    0    0    0    0    0    0    0   
0 Side Office    102    Wood Circular w/2 drawer    0    0    0    0    0    0
   0    0    0    0    0 Cube    Across from #102    Wood Circular w/sm 3 drawer
& lg 2 drawer cabinet    0    0    0    0    0    0    0    0    0    0    0
Side Office    103    Wood Circular w/2 drawer    0    0    0    0    0    0   
0    0    0    0    0 Cube    Across from #103    Circular Desk w/sm 3 drawer   
0    0    0    0    0    0    0    0    0    0    0 Side Office    104    Wood
Circular w/2 drawer    0    0    0    0    0    0    0    0    0    0    0 Cube
   Across from #104    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0   
0    0    0    0    0    0    0    0    0    0 Side Office    105    Wood
Circular w/2 drawer    0    0    0    0    0    0    0    0    0    0    0 Cube
   Across from #105    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0   
0    0    0    0    0    0    0    0    0    0 Corner Office    106    Wood
Circular w/3 drawer    0    0    0    0    0    0    0    0    0    0    0 Side
Office    107    Wood Circular w/3 drawer    0    0    0    0    0    0    0   
0    0    0    0    Across from #107    0    0    0    0    0    0    0    0   
0    0    0    0 Side Office    108    Wood Circular w/2 drawer    0    0    0
   0    0    0    0    0    0    0    0    Across from #108    0    0    0    0
   0    0    0    0    0    0    0    0 Cube    Across from #108    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0
   0    0    0    0 Side Office    109    Wood Circular w/2 drawer    0    0   
0    0    0    0    0    0    0    0    0 Cube    Across from #109    Wood
Circular w/sm 2 drawer    0    0    0    0    0    0    0    0    0    0    0
Side Office    110    Wood Circular w/2 drawer    0    0    0    0    0    0   
0    0    0    0    0    Across from #110    0    0    0    0    0    0    0   
0    0    0    0    0 Copy Room    Across from #110    0    0    0    0    3   
1    0    0    0    0    0    0 Side Office    111    Wood Circular w/2 drawer
   0    0    1    0    0    0    0    0    0    0    0 Down Aisle    Across from
#111    0    0    0    0    0    0    0    0    0    0    0    0 Cube #1    Down
Aisle from #111    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0
   0    0    0    0    0    0    0    0    0 Cube #2    Down Aisle from #111   
Wood Circular w/2 drawer cabinet    0    0    0    0    0    0    0    0    0   
0    0 Cube #3    Down Aisle from #111    Wood Circular w/sm 3 drawer & lg 2
drawer cabinet    0    0    0    0    0    0    0    0    0    0    0 Side
Office    112    Wood Circular w/2 drawer    0    0    0    0    0    0    0   
0    0    0    0 Side Office    113    Wood Circular w/2 drawer    0    0    0
   0    0    0    0    0    0    0    0 Cube 1-A Left Side    Down Aisle from
#113    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0   
0    0    0    0    0    0    0 Cube 1-B Right Side    Down Aisle from #113   
Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0
   0    0    0    0    0 Cube 2-A Left Side    Down Aisle from #113    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0
   0    0    0    0 Cube 2-B Right Side    Down Aisle from #113    Wood Circular
w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0    0    0
   0    0 Cube 3-A Left Side    Down Aisle from #113    Wood Circular w/sm 3
drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0    0    0    0
   0 Cube 3-B Right Side    Down Aisle from #113    Wood Circular w/sm 3 drawer
& lg 2 drawer cabinet    0    0    0    0    0    0    0    0    0    0    0
Down Aisle    Across from #113    0    0    0          0    0    0    0    0   
0    1 Side Office    114    Wood Circular w/sm 3 drawer    0    0    0    0   
0    0    0    0    0    0    0 Side Office    115    Wood Circular w/sm 3
drawer    0    0    0    0    0    0    0    0    0    0    0 Cube 1-A Right
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 1-B Left
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 2-A Right
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 2-B Left
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 3-A Right
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 3-B Left
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Side Office   
116    Wood Circular w/2 drawer    0    0    0    0    0    0    0    0    0   
0    0 Side Office    117    Wood Circular w/2 drawer    1    0    0    0    0
   0    0    0    0    0    0 Conference Room    Across from 117    0    0    0
   0    0    0    0    0    0    0    0    0 Small V-shaped Room    117-A    0
   2    0    0    0    0    0    0    0    0    0    0 Conference Room    Across
from 117-A    0    0    0    0    0    0    0    0    0    0    0    0 Board
Room    118    0    0    0    0    0    0    0    0    0    0    0    0
Reception Area    Across from #118    0    0    0    0    0    0    0    0    0
   0    0    0 Storage Room    118-A    0    1    0    0    0    0    0    0   
0    0    0    0 Library    146    0    2    0    0    0    0    0    0    0   
0    0    1 Hallway    Outside Room #146    0    0    0    0    0    0    0    0
   0    0    0    1 Central Records Room    147    Gray 5 ft w × 30"    0    0
   0    0    0    0    0    0    0    0    0 Server Room    148    0    0    1
   0    0    0    0    0    0    0    0    0 Storage Room    150    0    0    0
   0    0    0    0    0    0    0    0    0 Store Room    151    0    0    1   
0    0    0    0    0    0    0    0    0 Store Room    153    0    0    2    0
   0    0    0    0    0    0    0    0 Store Room    154    0    0    0    0   
0    0    1    0    0    0    0    0 Store Room    155    0    0    1    0    0
   0    0    0    0    0    0    0 Office    156    0    0    0    0    0    0
   1    0    0    0    0    0 Office    157    0    0    0    0    0    0    1
   1    0    0    0    0 Employee Lounge    158    0    0    0    0    0    0   
0    0    0    0    0    0 Office    159    0    0    0    0    0    0    1    1
   0    0    0    0 Hallway    Outside #158 & 159    0    0    2    0    0    0
   0    0    0    0    0    0 Office    160    0    0    0    0    0    0    1
   0    1    0    0    0 Sink Area    Down Aisle from # 160    0    0    0    0
   0    0    0    0    0    0    0    0 Down Aisle    Side of Office # 160    0
   0    0    0    0    0    0    0    0    0    0    3 Office    161    0    0
   0    0    0    0    0    0    0    0    1    0 Cube 1-A Left Side    Down
Aisle from # 161    Wood Circular Desk w/sm 3 drawers    0    0    0    0    0
   0    0    0    0    0    0 Cube 1-B Right Side    Down Aisle from # 161   
Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0
   0    0    0    0    0 Cube 2-A Left Side    Down Aisle from # 161    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0
   0    0    0    0 Cube 2-B Right Side    Down Aisle from # 161    Wood
Circular Desk    0    0    0    0    0    0    0    0    0    0    0 Office   
162    0    0    1    0    0    0    0    0    1    0    1    0 Office    163   
0    0    0    0    0    0    0    1    0    0    0    0 Cube 1-A Left Side   
Down Aisle from # 163    Wall to Wall Wooden Circular desk w/6 sm 3 drawer    0
   0    0    0    0    0    0    0    0    0    0 Cube 1-B Right Side    Down
Aisle from # 163    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0
   0    0    0    0    0    0    0    0    0 Cube 2 Right Side    Down Aisle
from # 163    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0
   0    0    0    0    0    0    0    0 Down Aisle    From Side Office #163    0
   0    0    0    0    0    0    0    0    0    0    1 Office    164    0    0
   0    0    0    0    0    0    0    0    0    0 Office    165    0    0    0
   0    0    0    0    0    0    0    1    0 Down Aisle    Across from # 165   
0    0    0    0    0    0    0    0    0    0    0    0 Office    166    0    0
   0    0    0    0    1    1    0    0    0    0 Office    167    0    0    0
   0    0    0    1    0    0    0    0    0 Office    168    0    0    0    0
   0    0    0    0    0    0    0    0 Conference Room    169    0    0    0   
0    0    0    0    0    0    0    0    0 Cubes    Opposite Rms 124, 125, & 126
   0    0    0    0    0    0    0    0    0    0    10    0 Cube w/ reddish
support beam    Near Rm # 127    2 Drawer Wood Built-in Lateral 42"    0    0   
0    0    0    0    0    0    0    0    1 Next To    Emergence Exit    0    0   
0    0    0    0    0    0    0    0    0    0                      0         
        

--------------------------------------------------------------------------------

SOUTH SAN FRANCISCO INVENTORY—March 6, 2009 (Continued)

 

Room Description

  

Rm Number

  

Desk Detail

   2
Drawer
Lateral
4'    2
Drawer
Side
Cabinet    2
Drawer
Peds    2 1/2 ft.
Wood 2
Drawer
Cabinet    3
Drawer
Wood
Cabinet    3
Drawer
Side by
Side 4
ft.
Cabinet    4
Drawer
Wood
Cabinet    4
Drawer
Wood
Side by
Side
Cabinet    Wood 6
ft.
Cabinet
w/ 2
Door
Top
Opening
& 2
Bottom
Drawers    Mahogany
Book
Shelf    Wood
Book
Shelf
4 ft.

TOTALS:

         2    2    6    1    4    3    5    6    5    1    5 Reception Lobby   
   1—  Set built-in reception desk marble    0    0    0    0    0    0    0   
0    0    1    0 Corner Office    100    Wood Circular w/3 drawer cabinet    0
   0    0    0    0    0    0    0    0    0    0 Side Office    101    Wood
Circular w/2 drawer cabinet    0    0    0    0    0    0    0    0    0    0   
0 Side Office    102    Wood Circular w/2 drawer    0    0    0    0    0    0
   0    0    0    0    0 Cube    Across from #102    Wood Circular w/sm 3 drawer
& lg 2 drawer cabinet    0    0    0    0    0    0    0    0    0    0    0
Side Office    103    Wood Circular w/2 drawer    0    0    0    0    0    0   
0    0    0    0    2 Cube    Across from #103    Circular Desk w/sm 3 drawer   
0    0    0    0    0    0    0    0    0    0    0 Side Office    104    Wood
Circular w/2 drawer    0    0    0    0    0    0    0    0    1    0    0 Cube
   Across from #104    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0   
0    0    0    0    0    0    0    0    0    0 Side Office    105    Wood
Circular w/2 drawer    0    0    0    0    0    0    0    0    0    0    0 Cube
   Across from #105    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0   
0    0    0    0    0    0    0    0    0    0 Corner Office    106    Wood
Circular w/3 drawer    0    2    0    0    0    0    0    0    1    0    0 Side
Office    107    Wood Circular w/3 drawer    0    0    0    0    0    0    0   
0    1    0    1    Across from #107    0    0    0    0    0    0    0    0   
2    0    0    0 Side Office    108    Wood Circular w/2 drawer    0    0    0
   0    0    0    0    0    0    0    1    Across from #108    0    0    0    0
   0    0    0    1    2    0    0    0 Cube    Across from #108    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0
   0    0    0    0 Side Office    109    Wood Circular w/2 drawer    0    0   
0    0    0    0    0    0    0    0    0 Cube    Across from #109    Wood
Circular w/sm 2 drawer    0    0    0    0    3    0    0    0    0    0    0
Side Office    110    Wood Circular w/2 drawer    0    0    0    0       0    0
   0    0    0    0    Across from #110    0    0    0    0    0    0    0    1
   0    0    0    0 Copy Room    Across from #110    0    0    0    0    0    0
   0    0    0    0    0    0 Side Office    111    Wood Circular w/2 drawer   
0    0    0    0    0    0    0       0    0    0 Down Aisle    Across from #111
   0    0    0    0    0    0    0    0    2    0    0    0 Cube #1    Down
Aisle from #111    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0
   0    0    0    0    0    0    0    0    0 Cube #2    Down Aisle from #111   
Wood Circular w/2 drawer cabinet    0    0    0    0    0    0    0    0    0   
0    0 Cube #3    Down Aisle from #111    Wood Circular w/sm 3 drawer & lg 2
drawer cabinet    0    0    0    0    0    0    0    0    0    0    0 Side
Office    112    Wood Circular w/2 drawer    0    0    0    0    0    0    0   
0    0    0    0 Side Office    113    Wood Circular w/2 drawer    0    0    0
   0    0    0    0    0    0    0    0 Cube 1-A Left Side    Down Aisle from
#113    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0   
0    0    0    0    0    0    0 Cube 1-B Right Side    Down Aisle from #113   
Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0
   0    0    0    0    0 Cube 2-A Left Side    Down Aisle from #113    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0
   0    0    0    0 Cube 2-B Right Side    Down Aisle from #113    Wood Circular
w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0    0    0
   0    0 Cube 3-A Left Side    Down Aisle from #113    Wood Circular w/sm 3
drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0    0    0    0
   0 Cube 3-B Right Side    Down Aisle from #113    Wood Circular w/sm 3 drawer
& lg 2 drawer cabinet    0    0    0    0    0    0    0    0    0    0    0
Down Aisle    Across from #113    0    0    0    0    0    0    0    3    0    0
   0    1 Side Office    114    Wood Circular w/sm 3 drawer    0    0    0    1
   0    0    0    0    1    0    0 Side Office    115    Wood Circular w/sm 3
drawer    0    0    0    0    0    0    0    0    1    0    0 Cube 1-A Right
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 1-B Left
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 2-A Right
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 2-B Left
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 3-A Right
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Cube 3-B Left
Side    Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0    0    0    0 Side Office   
116    Wood Circular w/2 drawer    0    0    0    0    0    0    0    0    0   
0    0 Side Office    117    Wood Circular w/2 drawer    0    0    0    0    0
   0    0    0    0    0    0 Conference Room    Across from 117    0    0    0
   0    0    0    0    0    0    0    0    0 Small V-shaped Room    117-A    0
   0    0    0    0    0    0    0    0    0    0    0 Conference Room    Across
from 117-A    0    0    0    0    0    0    0    0    0    0    0    0 Board
Room    118    0    0    0    0    0    0    0    0    0    0    0    0
Reception Area    Across from #118    0    0    0    0    0    0    0    0    0
   0    0    0 Storage Room    118-A    0    0    0    0    0    0    0    0   
0    0    0    0 Library    146    0    0    0    0    0    0    0    0    0   
0    0    0 Hallway    Outside Room #146    0    0    0    0    0    0    3    0
   0    0    0    0 Central Records Room    147    Gray 5 ft w × 30"    0    0
   0    0    0    0    0    0    0    0    0 Server Room    148    0    0    0
      0    0    0    0    0    0    0    0 Storage Room    150    0    0    0   
0    0    0    0    0    0    0    0    0 Store Room    151    0    0    0    0
   0    0    0    0    0    0    0    0 Store Room    153    0    0    0    0   
0    0    0    0    0    0    0    0 Store Room    154    0    0    0    0    0
   0    0    0    0    0    0    0 Store Room    155    0    0    0    0    0   
0    0    0    0    0    0    0 Office    156    0    0    0    0    0    0    0
   0    0    0    0    0 Office    157    0    0    0    0    0    0    0    0
   0    0    0    0 Employee Lounge    158    0    0    0    0    0    0    0   
0    0    0    0    0 Office    159    0    0       0    0    0    0    0    0
   0    0    0 Hallway    Outside #158 & 159    0    0    0    0    0    0    0
   0    0    0    0    0 Office    160    0    0    0    0    0    0    0    0
   0    0    0    0 Sink Area    Down Aisle from # 160    0    0    0    0    0
   0    0    0    0    0    0    0 Down Aisle    Side of Office # 160    0    0
   0    0    0    0    0    0    0    0    0    0 Office    161    0    0    0
   0    0    0    0    0    0    0    0    0 Cube 1-A Left Side    Down Aisle
from # 161    Wood Circular Desk w/sm 3 drawers    0    0    0    0    0    0   
0    0    0    0    0 Cube 1-B Right Side    Down Aisle from # 161    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0
   0    0    0    0 Cube 2-A Left Side    Down Aisle from # 161    Wood Circular
w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0    0    0
   0    0 Cube 2-B Right Side    Down Aisle from # 161    Wood Circular Desk   
1    0    0    0    1    0    0    0    0    0    0 Office    162    0    0    0
   0    0    0    0    0    0    0    0    0 Office    163    0    0    0    0
   0    0    0    0    0    0    0    0 Cube 1-A Left Side    Down Aisle from
# 163    Wall to Wall Wooden Circular desk w/6 sm 3 drawer    0    0    0    0
   0    0    0    0    0    0    0 Cube 1-B Right Side    Down Aisle from # 163
   Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0   
0    0    0    0    0    0 Cube 2 Right Side    Down Aisle from # 163    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0
   0    0    0    0 Down Aisle    From Side Office #163    0    0    0    0    0
   0    0    0    0    0    0    0 Office    164    0    0    0    0    0    0
   0    0    0    0    0    0 Office    165    0    0    0    0    0    0    0
   0    0    0    0    0 Down Aisle    Across from # 165    0    0    0    0   
0    0    0    0    0    0    0    0 Office    166    0    0    0    0    0    0
   0    0    0    0    0    0 Office    167    0    0    0    0    0    0    0
   0    0    0    0    0 Office    168    0    0    0    0    0    0    0    0
   0    0    0    0 Conference Room    169    0    0    0    0    0    0    0   
0    0    0    0    0 Cubes    Opposite Rms 124, 125, & 126    0    1    0    6
   0    0    0    0    0    0    0    0 Cube w/ reddish support beam    Near Rm
# 127    2 Drawer Wood Built-in Lateral 42"    0    0    0    0    0    0    0
   0    0    0    0 Next To    Emergence Exit    0    0    0    0    0    0    0
   0    0    0    0    0                                       

--------------------------------------------------------------------------------

SOUTH SAN FRANCISCO INVENTORY—March 6, 2009 (Continued)

 

Room Description

  

Rm Number

  

Desk Detail

   Wood Book
Shelf 4 ft.
Side by Side    Gray
Metal
5 ft.    Metal
55"h
×
36"w    Wood
Book
Shelf
6 ft.    Wood
Book
Shelf
7 ft.    Pairs
of
Double
Metal
Book
Shelves    Metal
Book
Shelves
(Not
Double)   

Misc.

TOTALS:

         2    1    3    12    8    5    9    Reception Lobby       1—  Set
built-in reception desk marble    0    0    0    0    0    0    0    2 Fake
Plants, 1-Leather sofa w/ bolsters Corner Office    100    Wood Circular w/3
drawer cabinet    0    0    0    0    0    0    0    0 Side Office    101   
Wood Circular w/2 drawer cabinet    0    0    0    0    0    0    0    0 Side
Office    102    Wood Circular w/2 drawer    0    0    0    0    0    0    0   
0 Cube    Across from #102    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet
   0    0    0    0    0    0    0    0 Side Office    103    Wood Circular w/2
drawer    0    0    0    0    0    0    0    0 Cube    Across from #103   
Circular Desk w/sm 3 drawer    0    0    0    0    0    0    0    0 Side Office
   104    Wood Circular w/2 drawer    0    0    0    0    0    0    0    0 Cube
   Across from #104    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0   
0    0    0    0    0    0    0 Side Office    105    Wood Circular w/2 drawer
   0    0    0    0    0    0    0    0 Cube    Across from #105    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0
   0 Corner Office    106    Wood Circular w/3 drawer    0    0    0    0    0
   0    0    0 Side Office    107    Wood Circular w/3 drawer    0    0    0   
1    1    1    1    0    Across from #107    0    0    0    0    0    0    0   
0    0 Side Office    108    Wood Circular w/2 drawer    0    0    0    1    1
   1    1    0    Across from #108    0    0    0    0    0    0    0    0    0
Cube    Across from #108    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet   
0    0    0    0    0    0    0    0 Side Office    109    Wood Circular w/2
drawer    0    0    0    0    0    0    0    0 Cube    Across from #109    Wood
Circular w/sm 2 drawer    0    0    0    0    0    0    0    0 Side Office   
110    Wood Circular w/2 drawer    0    0    0    0    0    0    0    0   
Across from #110    0    0    0    0    0    0    0    0    0 Copy Room   
Across from #110    0    0    0    0    0    0    0    0    1-Fellowes Power
shred 320, 1-Gray Metal 3' × 6' Wall Mail Box Slot, 1-3' × 6' Gray Metal 2 door
/5 shelf wall cabinet Side Office    111    Wood Circular w/2 drawer    0    0
   0    0    0    0    0    0 Down Aisle    Across from #111    0    2    0    0
   0    0    0    0    0 Cube #1    Down Aisle from #111    Wood Circular w/sm 3
drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0    0 Cube #2   
Down Aisle from #111    Wood Circular w/2 drawer cabinet    0    0    0    0   
0    0    0    0 Cube #3    Down Aisle from #111    Wood Circular w/sm 3 drawer
& lg 2 drawer cabinet    0    0    0    0    0    0    0    0 Side Office    112
   Wood Circular w/2 drawer    0    0    0    0    0    0    0    0 Side Office
   113    Wood Circular w/2 drawer    0    0    0    0    0    0    0    0 Cube
1-A Left Side    Down Aisle from #113    Wood Circular w/sm 3 drawer & lg 2
drawer cabinet    0    0    0    0    0    0    0    0 Cube 1-B Right Side   
Down Aisle from #113    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0
   0    0    0    0    0    0    0 Cube 2-A Left Side    Down Aisle from #113   
Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0
   0    0 Cube 2-B Right Side    Down Aisle from #113    Wood Circular w/sm 3
drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0    0 Cube 3-A
Left Side    Down Aisle from #113    Wood Circular w/sm 3 drawer & lg 2 drawer
cabinet    0    0    0    0    0    0    0    0 Cube 3-B Right Side    Down
Aisle from #113    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0
   0    0    0    0    0    0 Down Aisle    Across from #113    0    0    0    0
   0    0    0    0    Side Office    114    Wood Circular w/sm 3 drawer    0   
0    0    0    0    0    0    NO Side Office    115    Wood Circular w/sm 3
drawer    0    0    0    0    0    0    0    NO Cube 1-A Right Side    Down
Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0
   0    0    0    0    0    0 Cube 1-B Left Side    Down Aisle from #115    Wood
Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0
   0 Cube 2-A Right Side    Down Aisle from #115    Wood Circular w/sm 3 drawer
& lg 2 drawer cabinet    0    0    0    0    0    0    0    0 Cube 2-B Left Side
   Down Aisle from #115    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet   
0    0    0    0    0    0    0    0 Cube 3-A Right Side    Down Aisle from #115
   Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0   
0    0    0 Cube 3-B Left Side    Down Aisle from #115    Wood Circular w/sm 3
drawer & lg 2 drawer cabinet    0    0    0    0    0    0    0    0 Side Office
   116    Wood Circular w/2 drawer    0    0    0    0    0    0    0    0 Side
Office    117    Wood Circular w/2 drawer    0    0    0    0    0    0    0   
0 Conference Room    Across from 117    0    0    0    0    0    0    0    0   
1-Drop Down Screen, 1 Ceiling Mounted Projector Small V-shaped Room    117-A   
0    0    0    0    0    0    0    0    0 Conference Room    Across from 117-A
   0    0    0    0    0    0    0    0    0 Board Room    118    0    0    0   
0    0    0    0    0    48 inch Flat Screen Monitor, 1-Ceiling Mounted & 1 wall
mounted Projector Reception Area    Across from #118    0    0    0    0    0   
0    0    0    1-6 ft. Brown Leather Couch w/ pillows Storage Room    118-A    0
   0    0    0    0    0    0    0    2-Red Metal 4 × 6 Storage Shelves Library
   146    0    0    1    0    10    6    0    0    1-3 ft metal book cart
Hallway    Outside Room #146    0    0    0    0    0    0    0    0    0
Central Records Room    147    Gray 5 ft w × 30"    0    0    0    0    0    3
   7    2-Schwab 5000 fire cabinets, 4 drawer 43"w, 1-Metal Cabinet 72×30×18,
4-file cabinets 54×20×32, 1-black 3 drawer ped, 1-metal file cab lateral 4
drawer 53" × 36", 1-dark gray file cab lateral 4 drawer 53" × 30", 2-Steel Book
Carts, 1 sm desk lamp. Server Room    148    0    0    0    0    0    0    0   
0    1-Panel UIT Cable Mgmt System, Plus Server Inventory, 2-APC Server Racks
Storage Room    150    0    0    0    1    0    0    0    0    3 shelving units
72"h ( 2 @ 35"w, 1 @ 48"w) Store Room    151    0    0    0    0    0    0    0
   0    3-Metal shelf units 72"h × 48"w Store Room    153    0    0    0    0   
0    0    0    0    0 Store Room    154    0    0    0    0    0    0    0    0
   1-Metal shelf units 72"h × 48"w, 1-Rotating Magazine Rack Steel Store Room   
155    0    0    0    0    0    0    0    0    3 small carts Office    156    0
   0    0    0    0    0    0    0    0 Office    157    0    0    0    0    0
   0    0    0    0 Employee Lounge    158    0    0    0    0    0    0    0   
0    4 metro shelve units 71"h, 1 small refrigerator, 1 full size refrigerator,
1 toaster oven, 1 microwave oven, 1 dishwasher, 1 coffee maker, 1 toaster Office
   159    0    0    0    0    0    0    0    0    metal file cabinet 52" × 26
1/2" × 15" Hallway    Outside #158 & 159    0    0    0    0    0    0    0    0
   0 Office    160    0    0    0    0    0    0    0    0    0 Sink Area   
Down Aisle from # 160    0    0    0    0    0    0    0    0    Compact
Refrigerator, 3 hole punch, hanging rack Down Aisle    Side of Office # 160    0
   0    0    0    0    0    0    0    Office    161    0    0    0    0    0   
0    0    0    0 Cube 1-A Left Side    Down Aisle from # 161    Wood Circular
Desk w/sm 3 drawers    0    0    0    0    0    0    0    0 Cube 1-B Right Side
   Down Aisle from # 161    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet   
0    0    0    0    0    0    0    0 Cube 2-A Left Side    Down Aisle from # 161
   Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0   
0    0    0 Cube 2-B Right Side    Down Aisle from # 161    Wood Circular Desk
   0    0    0    0    0    0    0    0 Office    162    0    0    0    0    0
   0    0    0    0 Office    163    0    0    0    0    0    0    0    0    0
Cube 1-A Left Side    Down Aisle from # 163    Wall to Wall Wooden Circular desk
w/6 sm 3 drawer    0    0    0    0    0    0    0    0 Cube 1-B Right Side   
Down Aisle from # 163    Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0
   0    0    0    0    0    0    0 Cube 2 Right Side    Down Aisle from # 163   
Wood Circular w/sm 3 drawer & lg 2 drawer cabinet    0    0    0    0    0    0
   0    0 Down Aisle    From Side Office #163    0    0    0    0    0    0    0
   0    Office    164    0    0    0    0    0    0    0    0    0 Office    165
   0    0    0    0    0    0    0    0    0 Down Aisle    Across from # 165   
0    0    0    0    0    0    0    0    Office    166    0    0    0    1    0
   0    0    0    0 Office    167    0    0    0    0    0    0    0    0    0
Office    168    0    0    0    1    0    0    0    0    0 Conference Room   
169    0    0    0    0    0    0    0    0    small Refrigerator, polycom
w/mics *for 501 Canal, small wall clock Cubes    Opposite Rms 124, 125, & 126   
0    0    0    0    0    0    0    0    0 Cube w/ reddish support beam    Near
Rm # 127    2 Drawer Wood Built-in Lateral 42"    0    0    0    0    0    0   
0    0 Next To    Emergence Exit    0    0    0    0    0    0    0    0   
49"h × 42"w w/ 4 drawer lateral metal (yellow)                              

--------------------------------------------------------------------------------

SOUTH SAN FRANCISCO SERVER ROOM INVENTORY—March 6, 2009

Cardkey system:

DELL PowerEdge 1950 rackmount server

HID card readers—5 ea

Andover Controls power panel (wall mounted)

Video surveillance system:

Integral Technologies DVXi rackmount unit

Eyeball ceiling-mount cameras—2ea

Switches:

Cisco Catalyst 3750G 48-port—3 ea

Cisco Catalyst 3750 48-port—1 ea

Cisco 2300 C3K Redundant Power Supply System

Asante 5-port Fast Internet hub

Firewall switches:

SonicWall Pro 2040

Cisco ASA 5510

Internet Routers:

Netopia 4622 (Covad T-1)

Cisco 1720 (XO T-1)

CarrierAccess ADIT-600 T-1 controller module (XO)

UPS(s):

APC Metered Rack PDUs—4-ea

APC SmartUPS 1400XL

APC SmartUPS 3000—2 ea

Tripplite SmartPro 1500

288 port Panduit patch panel

Sanyo KS-2472 Air Conditioner

Avaya (Lucent) Merlin Magix 515A Expanded Controller Unit

Phone Switch

Voicemail System