Exhibit 10.4

FOURTH AMENDMENT TO LEASE

THIS FOURTH AMENDMENT TO LEASE (this “Fourth Amendment”) is made as of
October 27, 2015, by and between ARE-MA REGION NO. 38, LLC, a Delaware limited
liability company (“Landlord”), and SAGE THERAPEUTICS, INC., a Delaware
corporation (“Tenant”).

RECITALS

A. Landlord and Tenant are now parties to that certain Lease Agreement dated as
of December 21, 2011, as amended by that certain First Amendment to Lease dated
as of October 26, 2012, as further amended by that certain Second Amendment to
Lease dated as of May 9, 2013, and as further amended by that certain Third
Amendment to Lease dated as of September 9, 2015 (the “Third Amendment”)(as
amended, the “Lease”). Pursuant to the Lease, Tenant leases certain premises
consisting of approximately 18,562 rentable square feet of space (“Current
Premises”) in a building located at 215 First Street, Cambridge, Massachusetts
(“Building”). The Current Premises are more particularly described in the Lease.
Capitalized terms used herein without definition shall have the meanings defined
for such terms in the Lease.

B. Landlord and Tenant desire, subject to the terms and conditions set forth
below, to amend the Lease to, among other things, expand the size of the Current
Premises by adding approximately 3,505 rentable square feet of space on the
first floor of the Building, as shown on Exhibit A attached hereto (the “Fourth
Expansion Premises”).

NOW, THEREFORE, in consideration of the foregoing Recitals, which are
incorporated herein by this reference, the mutual promises and conditions
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant hereby agree
as follows:

 

1. Fourth Expansion Premises. In addition to the Current Premises, commencing on
the Fourth Expansion Premises Commencement Date (as defined below), Landlord
leases to Tenant, and Tenant leases from Landlord, the Fourth Expansion
Premises.

 

2. Delivery. Landlord shall use reasonable efforts to deliver the Fourth
Expansion Premises to Tenant on or before the Target Fourth Expansion Premises
Commencement Date with Landlord’s Work Substantially Completed (“Delivery” or
“Deliver”). If Landlord fails to timely Deliver the Fourth Expansion Premises,
Landlord shall not be liable to Tenant for any loss or damage resulting
therefrom, and the Lease with respect to the Fourth Expansion Premises shall not
be void or voidable. As used herein, the terms “Landlord’s Work,” “Tenant
Delays” and “Substantially Completed” shall have the meanings set forth for such
terms in the work letter attached to this Fourth Amendment as Exhibit B (“Fourth
Expansion Premises Work Letter”).

The “Fourth Expansion Premises Commencement Date” shall be the earlier to occur
of: (i) the date that Landlord delivers the Fourth Expansion Premises to Tenant,
or (ii) the date that Landlord could have delivered to Fourth Expansion Premises
to Tenant but for Tenant Delays. The “Target Fourth Expansion Premises
Commencement Date” shall be March 1, 2016. The “Fourth Expansion Premises Rent
Commencement Date” shall be the date that is 3 months after the Fourth Expansion
Premises Commencement Date. Upon request of Landlord, Tenant shall execute and
deliver a written acknowledgment of the Fourth Expansion Premises Commencement
Date and the Fourth Expansion Premises Rent Commencement Date in a form
substantially similar to the form of the “Acknowledgement of Commencement Date”
attached to the Lease as Exhibit G; provided, however, Tenant’s failure to
execute and deliver such acknowledgment shall not affect Landlord’s rights
hereunder.

 

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Except as set forth in the Fourth Expansion Premises Work Letter: (i) Tenant
shall accept the Fourth Expansion Premises in their condition as of the Fourth
Expansion Premises Commencement Date, subject to all applicable Legal
Requirements; (ii) Landlord shall have no obligation for any defects in the
Fourth Expansion Premises; and (iii) Tenant’s taking possession of the Fourth
Expansion Premises shall be conclusive evidence that Tenant accepts the Fourth
Expansion Premises and that the Fourth Expansion Premises were in good condition
at the time possession was taken. The Fourth Expansion Premises shall be
delivered to Tenant without any furniture.

Tenant agrees and acknowledges that neither Landlord nor any agent of Landlord
has made any representation or warranty with respect to the condition of all or
any portion of the Fourth Expansion Premises, and/or the suitability of the
Fourth Expansion Premises for the conduct of Tenant’s business, and Tenant
waives any implied warranty that the Fourth Expansion Premises are suitable for
the Permitted Use.

 

3. Definition of Premises. Commencing on the Fourth Expansion Premises
Commencement Date, the defined term “Premises” on Page 1 of the Lease is deleted
in its entirety and replaced with the following:

“Premises: That portion of the Building (as defined below) containing
approximately 22,067 rentable square feet, consisting of (i) approximately 5,900
rentable square feet on the second floor (“Original Premises”),
(ii) approximately 600 rentable square feet on the second floor (“Expansion
Premises”), (iii) approximately 4,100 rentable square feet on the second floor
(“Second Expansion Premises”), (iv) approximately 7,962 rentable square feet on
the second floor (“Third Expansion Premises”), and (v) approximately 3,505
rentable square feet on the first floor (“Fourth Expansion Premises”), all as
determined by Landlord, as shown on Exhibit A.”

Exhibit A attached to the Lease is amended as of the Fourth Expansion Premises
Commencement Date to include Exhibit A attached to this Fourth Amendment.

 

4. Base Rent.

a. Current Premises. Tenant shall continue to pay Base Rent for the Current
Premises as provided for in the Lease.

b. Fourth Expansion Premises. Commencing on the Fourth Expansion Premises Rent
Commencement Date through July 31, 2017, Tenant shall pay Base Rent for the
Fourth Expansion Premises in the amount of $37.60 per rentable square foot of
the Fourth Expansion Premises per year. Commencing on August 1, 2017, Tenant
shall pay Base Rent for the Fourth Expansion Premises in the amount of $48.00
per rentable square foot of the Fourth Expansion Premises per year. Commencing
on August 1, 2018, and continuing thereafter on each August 1st during the Base
Term, Base Rent for the Fourth Expansion Premises shall be increased by $1.00
per rentable square foot of the Fourth Expansion Premises per year. Base Rent
for the Fourth Expansion Premises, as so adjusted, shall thereafter be due as
provided herein.

 

5. Tenant’s Share. Commencing on the Fourth Expansion Premises Commencement
Date, the defined term “Tenant’s Share” on page 1 of the Lease is deleted in its
entirety and replaced with the following:

“Tenant’s Share for Original Premises and Expansion Premises: 1.77%

Tenant’s Share for Second Expansion Premises: 1.12%

Tenant’s Share of Third Expansion Premises: 2.17%

Tenant’s Share of Fourth Expansion Premises: 0.96%”

 

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Notwithstanding anything to the contrary contained in the Lease, (i) neither
Operating Expenses nor Taxes payable by Tenant with respect to the Fourth
Expansion Premises shall be subject to a Base Year, and (ii) Tenant shall not be
required to pay Operating Expenses or Taxes with respect to the Fourth Expansion
Premises for the period commencing on the Fourth Expansion Premises Commencement
Date through July 31, 2017 (for the avoidance of doubt, Tenant shall be required
to pay for electricity to the Fourth Expansion Premises during such period).
Tenant shall commence paying Operating Expenses and Taxes with respect to the
Fourth Expansion Premises on August 1, 2017.

 

6. Base Term. Commencing on the Fourth Expansion Premises Commencement Date, the
defined term “Base Term” on page 1 of the Lease is deleted in its entirety and
replaced with the following:

“Base Term: Beginning (i) with respect to the Original Premises, on the
Commencement Date, (ii) with respect to the Expansion Premises, on the Expansion
Premises Commencement Date, (iii) with respect to the Second Expansion Premises,
on the Second Expansion Premises Commencement Date, (iv) with respect to the
Third Expansion Premises, on the Third Expansion Premises Commencement Date, and
(v) with respect to the Fourth Expansion Premises, on the Fourth Expansion
Premises Commencement Date, and ending with respect to the entire Premises on
February 28, 2022 (“Expiration Date”).”

 

7. Rentable Area of Premises. Commencing on the Fourth Expansion Premises
Commencement Date, the defined term “Rentable Area of Premises” on page 1 of the
Lease is deleted in its entirety and replaced with the following:

“Rentable Area: Approximately 22,067 square feet”

 

8. Parking. Notwithstanding anything to the contrary contained herein,
commencing on the Fourth Expansion Premises Commencement Date, the number of
parking spaces that Tenant is entitled to license pursuant to Section 8 of the
Lease (as amended by Section 11 of the Third Amendment) shall be increased from
19 to 22 parking spaces and all references to “19” contained in Section 8 of the
Lease (as amended by Section 11 of the Third Amendment) shall be deleted and
replaced with “22.”

 

9. Fourth Expansion Premises Utilities. The Fourth Expansion Premises shall be
separately submetered and electricity to the Fourth Expansion Premises shall be
charged directly to Tenant by Landlord. The Fourth Expansion Premises shall be
subject to the terms of Section 9(a) of the original Lease with respect to
Utilities.

 

10. Brokers. Landlord and Tenant each represents and warrants that it has not
dealt with any broker, agent or other person (collectively, “Broker”) in
connection with the transaction reflected in this Fourth Amendment and that no
Broker brought about this transaction, other than Transwestern RBJ and Cushman &
Wakefield. Landlord and Tenant each hereby agrees to indemnify and hold the
other harmless from and against any claims by any Broker claiming a commission
or other form of compensation by virtue of having dealt with Tenant or Landlord,
as applicable, with regard to this Fourth Amendment.

 

11.

OFAC. Tenant and Landlord are currently (a) in compliance with and shall at all
times during the Term of the Lease remain in compliance with the regulations of
the Office of Foreign Assets Control (“OFAC”) of the U.S. Department of Treasury
and any statute, executive order, or regulation relating thereto (collectively,
the “OFAC Rules”), (b) not listed on, and shall not during the term of the Lease
be listed on, the Specially Designated Nationals and Blocked Persons List,
Foreign Sanctions Evaders List or the Sectoral Sanctions Identifications List,
which are all

 

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maintained by OFAC and/or on any other similar list maintained by OFAC or other
governmental authority pursuant to any authorizing statute, executive order, or
regulation, and (c) not a person or entity with whom a U.S. person is prohibited
from conducting business under the OFAC Rules.

 

12. Miscellaneous.

a. This Fourth Amendment is the entire agreement between the parties with
respect to the subject matter hereof and supersedes all prior and
contemporaneous oral and written agreements and discussions. This Fourth
Amendment may be amended only by an agreement in writing, signed by the parties
hereto.

b. This Fourth Amendment is binding upon and shall inure to the benefit of the
parties hereto, their respective successors and assigns.

c. This Fourth Amendment may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which when taken together shall
constitute one and the same instrument. The signature page of any counterpart
may be detached therefrom without impairing the legal effect of the signature(s)
thereon provided such signature page is attached to any other counterpart
identical thereto except having additional signature pages executed by other
parties to this Fourth Amendment attached thereto.

d. Except as amended and/or modified by this Fourth Amendment, the Lease is
hereby ratified and confirmed and all other terms of the Lease shall remain in
full force and effect, unaltered and unchanged by this Fourth Amendment. In the
event of any conflict between the provisions of this Fourth Amendment and the
provisions of the Lease, the provisions of this Fourth Amendment shall prevail.
Whether or not specifically amended by this Fourth Amendment, all of the terms
and provisions of the Lease are hereby amended to the extent necessary to give
effect to the purpose and intent of this Fourth Amendment.

 

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

 

TENANT:

SAGE THERAPEUTICS, INC.,

a Delaware corporation

By:   /s/ Kimi Iguchi Its:    

 

LANDLORD:

ARE-MA REGION NO. 38, LLC,

a Delaware limited liability company

By:  

Alexandria Real Estate Equities, L.P.,

a Delaware limited partnership, managing member

        By:   ARE-QRS CORP.,    

a Maryland corporation,

general partner

          By:   /s/ Eric S. Johnson     Its:   Eric S. Johnson      

Senior Vice President

RE Legal Affaires

 

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EXHIBIT A

The Fourth Expansion Premises

 

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Inc. ALL RIGHTS RESERVED. Confidential and Proprietary – Do Not Copy or
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EXHIBIT B

Fourth Expansion Premises Work Letter

THIS FOURTH EXPANSION PREMISES WORK LETTER dated October 27, 2015 (this “Fourth
Expansion Premises Work Letter”) is made and entered into by and between ARE-MA
REGION NO. 38, LLC, a Delaware limited liability company (“Landlord”), and SAGE
THERAPEUTICS, INC., a Delaware corporation (“Tenant”), and is attached to and
made a part of that certain Lease Agreement dated as of December 21, 2011, as
amended by that certain First Amendment to Lease dated as of October 26, 2012,
as further amended by that certain Second Amendment to Lease dated as of May 9,
2013, as amended by that certain Third Amendment to Lease dated as of
September 9, 2015, and as further amended by that certain Fourth Amendment to
Lease dated of even date herewith (the “Fourth Amendment”) (as amended, the
“Lease”), by and between Landlord and Tenant. Any initially capitalized terms
used but not defined herein shall have the meanings given them in the Lease.

1. General Requirements.

(a) Tenant’s Authorized Representative. Tenant designates Kelly Linehan and Kimi
Iguchi (either such individual acting alone, “Tenant’s Representative”) as the
only persons authorized to act for Tenant pursuant to this Fourth Expansion
Premises Work Letter. Landlord shall not be obligated to respond to or act upon
any request, approval, inquiry or other communication (“Communication”) from or
on behalf of Tenant in connection with this Fourth Expansion Premises Work
Letter unless such Communication is in writing from Tenant’s Representative.
Tenant may change either Tenant’s Representative at any time upon not less than
5 business days advance written notice to Landlord. Neither Tenant nor Tenant’s
Representative shall be authorized to direct Landlord’s contractors in the
performance of Landlord’s Work (as hereinafter defined).

(b) Landlord’s Authorized Representative. Landlord designates Jeff McComish and
Bill DePippo (either such individual acting alone, “Landlord’s Representative”)
as the only persons authorized to act for Landlord pursuant to this Fourth
Expansion Premises Work Letter. Tenant shall not be obligated to respond to or
act upon any request, approval, inquiry or other Communication from or on behalf
of Landlord in connection with this Fourth Expansion Premises Work Letter unless
such Communication is in writing from Landlord’s Representative. Landlord may
change either Landlord’s Representative at any time upon not less than 5
business days advance written notice to Tenant. Landlord’s Representative shall
be the sole persons authorized to direct Landlord’s contractors in the
performance of Landlord’s Work.

(c) Architects, Consultants and Contractors. Landlord and Tenant hereby
acknowledge and agree that: (i) the general contractor and any subcontractors
for the Tenant Improvements shall be selected by Landlord, subject to Tenant’s
approval, which approval shall not be unreasonably withheld, conditioned or
delayed, and (ii) SGA shall be the architect (the “TI Architect”) for the Tenant
Improvements.

2. Tenant Improvements.

(a) Tenant Improvements Defined. As used herein, “Tenant Improvements” shall
mean all improvements to the Fourth Expansion Premises of a fixed and permanent
nature as shown on the TI Construction Drawings, as defined in Section 2(c)
below. The quality of the Tenant Improvements shall be consistent with the
quality of the improvements existing in the Premises as of the date of the
Fourth Amendment. Other than Landlord’s Work (as defined in Section 3(a) below),
Landlord shall not have any obligation whatsoever with respect to the finishing
of the Fourth Expansion Premises for Tenant’s use and occupancy.

 

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(b) Tenant’s Space Plans. Landlord and Tenant acknowledge and agree that that
certain plan attached hereto as Schedule 1 (the “Space Plan”) has been approved
by Landlord and Tenant.

(c) Working Drawings. Landlord shall cause the TI Architect to prepare and
deliver to Tenant for review and comment construction plans, specifications and
drawings for the Tenant Improvements (“TI Construction Drawings”), which TI
Construction Drawings shall be prepared substantially in accordance with the
Space Plan. Tenant shall be solely responsible for ensuring that the TI
Construction Drawings reflect Tenant’s requirements for the Tenant Improvements.
Tenant shall deliver its written comments on the TI Construction Drawings to
Landlord not later than 10 business days after Tenant’s receipt of the same;
provided, however, that Tenant may not disapprove any matter that is consistent
with the Space Plan without submitting a Change Request. Landlord and the TI
Architect shall consider all such comments in good faith and shall, within 10
business days after receipt, notify Tenant how Landlord proposes to respond to
such comments, but Tenant’s review rights pursuant to the foregoing sentence
shall not delay the design or construction schedule for the Tenant Improvements.
Any disputes in connection with such comments shall be resolved in accordance
with Section 2(d) hereof. Provided that the design reflected in the TI
Construction Drawings is consistent with the Space Plan, Tenant shall approve
the TI Construction Drawings submitted by Landlord, unless Tenant submits a
Change Request. Once approved by Tenant, subject to the provisions of Section 4
below, Landlord shall not materially modify the TI Construction Drawings except
as may be reasonably required in connection with the issuance of the TI Permit
(as defined in Section 3(b) below).

(d) Approval and Completion. It is hereby acknowledged by Landlord and Tenant
that the TI Construction Drawings must be completed and approved no later than
October 30, 2015, in order for the Landlord’s Work to be Substantially Complete
by the Target Fourth Expansion Premises Commencement Date (as defined in the
Third Amendment). Upon any dispute regarding the design of the Tenant
Improvements, which is not settled within 10 business days after notice of such
dispute is delivered by one party to the other, Tenant may make the final
decision regarding the design of the Tenant Improvements, provided (i) Tenant
acts reasonably and such final decision is either consistent with or a
compromise between Landlord’s and Tenant’s positions with respect to such
dispute, (ii) that all increases in costs and expenses resulting from any such
decision by Tenant shall be payable by Tenant, and (iii) Tenant’s decision will
not affect the base Building, structural components of the Building or any
Building systems. Any changes to the TI Construction Drawings following
Landlord’s and Tenant’s approval of same requested by Tenant shall be processed
as provided in Section 4 hereof.

3. Performance of Landlord’s Work.

(a) Definition of Landlord’s Work. As used herein, “Landlord’s Work” shall mean
the work of constructing the Tenant Improvements.

(b) Commencement and Permitting. Landlord shall commence construction of the
Tenant Improvements upon obtaining a building permit (the “TI Permit”)
authorizing the construction of the Tenant Improvements consistent with the TI
Construction Drawings approved by Tenant. The cost of obtaining the TI Permit
shall be payable by Landlord. Tenant shall assist Landlord in obtaining the TI
Permit. If any Governmental Authority having jurisdiction over the construction
of Landlord’s Work or any portion thereof shall impose terms or conditions upon
the construction thereof that: (i) are inconsistent with Landlord’s obligations
hereunder, (ii) increase the cost of constructing Landlord’s Work, or (iii) will
materially delay the construction of Landlord’s Work, Landlord and Tenant shall
reasonably and in good faith seek means by which to mitigate or eliminate any
such adverse terms and conditions.

(c) Completion of Landlord’s Work. Landlord shall (i) substantially complete or
cause to be substantially completed Landlord’s Work in a good and workmanlike
manner, in accordance with the TI Permit subject, in each case, to Minor
Variations and normal “punch list” items of a non-material nature that do not
interfere with the use of the Fourth Expansion Premises, and (ii) obtain a
certificate or temporary certificate of occupancy (or an equivalent approval)
for the Fourth Expansion Premises

 

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permitting lawful occupancy of the Fourth Expansion Premises (but specifically
excluding any permits, licenses or other governmental approvals required to be
obtained in connection with Tenant’s operations in the Fourth Expansion
Premises)(“Substantial Completion” or “Substantially Complete”). Upon
Substantial Completion of Landlord’s Work, Landlord shall require the TI
Architect and the general contractor to execute and deliver, for the benefit of
Tenant and Landlord, a Certificate of Substantial Completion in the form of the
American Institute of Architects (“AIA”) document G704. For purposes of this
Fourth Expansion Premises Work Letter, “Minor Variations” shall mean any
modifications reasonably required: (i) to comply with all applicable Legal
Requirements and/or to obtain or to comply with any required permit (including
the TI Permit); (ii) to comply with any request by Tenant for modifications to
Landlord’s Work; (iii) to comport with good design, engineering, and
construction practices that are not material; or (iv) to make reasonable
adjustments for field deviations or conditions encountered during the
construction of Landlord’s Work.

(d) Selection of Materials. Where more than one type of material or structure is
indicated on the TI Construction Drawings approved by Landlord and Tenant, the
option will be selected at Landlord’s sole and absolute subjective discretion.
As to all building materials and equipment that Landlord is obligated to supply
under this Fourth Expansion Premises Work Letter, Landlord shall select the
manufacturer thereof in its sole and absolute subjective discretion.

(e) Delivery of the Fourth Expansion Premises. When Landlord’s Work is
Substantially Complete, subject to the remaining terms and provisions of this
Section 3(e), Tenant shall accept the Fourth Expansion Premises. Tenant’s taking
possession and acceptance of the Fourth Expansion Premises shall not constitute
a waiver of: (i) any warranty with respect to workmanship (including
installation of equipment) or material (exclusive of equipment provided directly
by manufacturers), (ii) any non-compliance of Landlord’s Work with applicable
Legal Requirements, or (iii) any claim that Landlord’s Work was not completed
substantially in accordance with the TI Construction Drawings (subject to Minor
Variations and such other changes as are permitted hereunder) (collectively, a
“Construction Defect”). Tenant shall have one year after Substantial Completion
within which to notify Landlord of any such Construction Defect discovered by
Tenant, and Landlord shall use reasonable efforts to remedy or cause the
responsible contractor to remedy any such Construction Defect within 30 days
thereafter. Notwithstanding the foregoing, Landlord shall not be in default
under the Lease if the applicable contractor, despite Landlord’s reasonable
efforts, fails to remedy such Construction Defect within such 30-day period, in
which case Landlord shall have no further obligation with respect to such
Construction Defect other than to cooperate, at no cost to Landlord, with Tenant
should Tenant elect to pursue a claim against such contractor.

(f) Tenant shall be entitled to receive the benefit of all construction
warranties and manufacturer’s equipment warranties relating to equipment
installed in the Fourth Expansion Premises. If requested by Tenant, Landlord
shall attempt to obtain extended warranties from manufacturers and suppliers of
such equipment, but the cost of any such extended warranties shall be borne
solely by Tenant. Landlord shall promptly undertake and complete, or cause to be
completed, all punch list items.

(g) Fourth Expansion Premises Commencement Date Delay. Except as otherwise
provided in the Lease, Delivery of the Fourth Expansion Premises shall occur
when Landlord’s Work has been Substantially Completed, except to the extent that
completion of Landlord’s Work shall have been actually delayed by any one or
more of the following causes (“Tenant Delay”):

(i) Tenant’s Representative was not available within 2 business day to give or
receive any Communication or to take any other action required to be taken by
Tenant hereunder;

(ii) Tenant’s request for Change Requests (as defined in Section 4(a) below)
whether or not any such Change Requests are actually performed;

(iii) Construction of any Change Requests;

 

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(iv) Tenant’s request for materials, finishes or installations requiring
unusually long lead times, provided that promptly after Landlord learns of such
long lead times, Landlord informs Tenant that the requested items will require
unusually long lead times;

(v) Tenant’s delay in reviewing, revising or approving plans and specifications
beyond the periods set forth herein;

(vi) Tenant’s delay in providing information critical to the normal progression
of the Project. Tenant shall provide such information as soon as reasonably
possible, but in no event longer than one week after receipt of any request for
such information from Landlord;

(vii) Tenant’s delay in making payments to Landlord for Excess TI Costs (as
defined in Section 5(b) below); or

(viii) Any other act or omission by Tenant or any Tenant Party (as defined in
the Lease), or persons employed by any of such persons.

If Delivery is delayed for any of the foregoing reasons, then Landlord shall
cause the TI Architect to certify the date on which the Tenant Improvements
would have been completed but for such Tenant Delay and such certified date
shall be the date of Delivery.

4. Changes. Any changes requested by Tenant to the Tenant Improvements after the
delivery and approval by Landlord of the Space Plan shall be requested and
instituted in accordance with the provisions of this Section 4 and shall be
subject to the written approval of Landlord and the TI Architect, such approval
not to be unreasonably withheld, conditioned or delayed.

(a) Tenant’s Request For Changes. If Tenant shall request changes to the Tenant
Improvements (“Changes”), Tenant shall request such Changes by notifying
Landlord in writing in substantially the same form as the AIA standard change
order form (a “Change Request”), which Change Request shall detail the nature
and extent of any such Change. Such Change Request must be signed by Tenant’s
Representative. Landlord shall, before proceeding with any Change, respond to
Tenant as soon as is reasonably possible with an estimate of: (i) the time it
will take, and (ii) the architectural and engineering fees and costs that will
be incurred, to analyze such Change Request (which costs shall be paid by Tenant
to the extent actually incurred, whether or not such change is implemented).
Landlord shall thereafter submit to Tenant in writing, within 5 business days of
receipt of the Change Request (or such longer period of time as is reasonably
required depending on the extent of the Change Request), an analysis of the
additional cost or savings involved, including, without limitation,
architectural and engineering costs and the period of time, if any, that the
Change will extend the date on which Landlord’s Work will be Substantially
Complete. Any such delay in the completion of Landlord’s Work caused by a
Change, including any reasonable suspension of Landlord’s Work while any such
Change is being evaluated and/or designed, shall be Tenant Delay.

(b) Implementation of Changes. If Tenant: (i) approves in writing the cost or
savings and the estimated extension in the time for completion of Landlord’s
Work, if any, and (ii) deposits with Landlord any Excess TI Costs required
pursuant to Section 5(b) below in connection with such Change, Landlord shall
cause the approved Change to be instituted. Notwithstanding any approval or
disapproval by Tenant of any estimate of the delay caused by such proposed
Change, the TI Architect’s determination of the amount of Tenant Delay in
connection with such Change shall be final and binding on Landlord and Tenant.

 

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5. Costs.

(a) TI Costs. Landlord shall be responsible for all hard and soft costs and
expenses for the design and performance of Landlord’s Work including, without
limitation, design, permits and construction costs in connection with the
construction of the Tenant Improvements, including, without limitation, the cost
of preparing the TI Construction Drawings and the Space Plan and Landlord’s
out-of-pocket expenses, up to $60.00 per rentable square foot of the Fourth
Expansion Premises, or $210,300 in the aggregate (collectively, “TI Costs”).
Notwithstanding anything to the contrary contained herein, in no event shall
Landlord be required to pay for any furniture, personal property or other
non-Building system materials or equipment, including, but not limited to,
Tenant’s voice or data cabling, not incorporated into the Tenant Improvements.

(b) Excess TI Costs. Notwithstanding anything to the contrary contained herein,
Tenant acknowledges and agrees that Landlord shall have no responsibility for
any costs arising from or related to Tenant’s changes to the Space Plan or TI
Construction Drawings, Tenant Delays, the cost of Changes and Change Requests
and any TI Costs in excess of to $60.00 per rentable square foot of the Fourth
Expansion Premises (collectively, “Excess TI Costs”). Tenant shall deposit with
Landlord 50% of the Excess TI Costs as a condition precedent to Landlord’s
obligation to complete the Tenant Improvements and the remaining 50% of the
Excess TI Costs upon Substantial Completion of the Tenant Improvements. If
Tenant fails to deposit any Excess TI Costs with Landlord, Landlord shall have
all of the rights and remedies set forth in the Lease for nonpayment of Rent
(including, but not limited to, the right to interest at the Default Rate and
the right to assess a late charge). For purposes of any litigation instituted
with regard to such amounts, those amounts will be deemed Rent under the Lease.

6. Tenant Access.

(a) Tenant’s Access Rights. Landlord hereby agrees to permit Tenant access, at
Tenant’s sole risk and expense, to the Fourth Expansion Premises (i) 14 days
prior to the Fourth Expansion Premises Commencement Date to perform any work
(“Tenant’s Work”) required by Tenant other than Landlord’s Work, provided that
such Tenant’s Work is coordinated with the TI Architect and the general
contractor, and complies with the Lease and all other reasonable restrictions
and conditions Landlord may impose (except the obligation to pay Base Rent or
Operating Expenses with respect to the Fourth Expansion Premises), and
(ii) prior to the completion of Landlord’s Work, to inspect and observe work in
process; all such access shall be during normal business hours or at such other
times as are reasonably designated by Landlord. Any entry by Tenant shall comply
with all established safety practices of Landlord’s contractor and Landlord
until completion of Landlord’s Work and acceptance thereof by Tenant.

(b) No Interference. Neither Tenant nor any Tenant Party (as defined in the
Lease) shall interfere with the performance of Landlord’s Work, nor with any
inspections or issuance of final approvals by applicable Governmental
Authorities, and upon any such interference, Landlord shall have the right to
exclude Tenant and any Tenant Party from the Fourth Expansion Premises until
Substantial Completion of Landlord’s Work.

(c) No Acceptance of Fourth Expansion Premises. The fact that Tenant may, with
Landlord’s consent, enter into the Fourth Expansion Premises prior to the date
Landlord’s Work is Substantially Complete for the purpose of performing Tenant’s
Work shall not be deemed an acceptance by Tenant of possession of the Fourth
Expansion Premises, but in such event Tenant shall defend with counsel
reasonably acceptable by Landlord, indemnify and hold Landlord harmless from and
against any loss of or damage to Tenant’s property, completed work, fixtures,
equipment, materials or merchandise, and from liability for death of, or injury
to, any person, caused by the act or omission of Tenant or any Tenant Party.

7. Miscellaneous.

(a) Consents. Whenever consent or approval of either party is required under
this Fourth Expansion Premises Work Letter, that party shall not unreasonably
withhold, condition or delay such consent or approval, unless expressly set
forth herein to the contrary.

 

   LOGO [g18262g69i54.jpg]    Copyright © 2005, Alexandria Real Estate Equities,
Inc. ALL RIGHTS RESERVED. Confidential and Proprietary – Do Not Copy or
Distribute. Alexandria and the Alexandria Logo are registered trademarks of
Alexandria Real Estate Equities, Inc.

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(b) Modification. No modification, waiver or amendment of this Fourth Expansion
Premises Work Letter or of any of its conditions or provisions shall be binding
upon Landlord or Tenant unless in writing signed by Landlord and Tenant.

(c) Default. Notwithstanding anything set forth herein or in the Lease to the
contrary, Landlord shall not have any obligation to perform any work hereunder
or to fund any portion of the TI Costs during any period that there is a Default
by Tenant under the Lease.

 

   LOGO [g18262g69i54.jpg]    Copyright © 2005, Alexandria Real Estate Equities,
Inc. ALL RIGHTS RESERVED. Confidential and Proprietary – Do Not Copy or
Distribute. Alexandria and the Alexandria Logo are registered trademarks of
Alexandria Real Estate Equities, Inc.

B-6

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Schedule 1

Space Plan

 

LOGO [g18262ex10_4-13.jpg]

 

   LOGO [g18262g69i54.jpg]    Copyright © 2005, Alexandria Real Estate Equities,
Inc. ALL RIGHTS RESERVED. Confidential and Proprietary – Do Not Copy or
Distribute. Alexandria and the Alexandria Logo are registered trademarks of
Alexandria Real Estate Equities, Inc.

B-7