exv10w8



 





Exhibit 10.8




AVENEL BUSINESS PARK




Lease




Between




BBI-BIOTECH RESEARCH LABORATORIES, INC.




and




B.F. SAUL REAL ESTATE INVESTMENT TRUST




 









 





AVENEL BUSINESS PARK




OFFICE LEASE

INDEX




	 	 	 	 	 	 	 
	ARTICLE	 	TITLE	 	PAGE
	1.

	 	Premises
	 	 	1	 
	2.

	 	Term
	 	 	1	 
	3.

	 	Rent
	 	 	1	 
	4.

	 	Intentionally Deleted
	 	 	3	 
	5.

	 	Annual Operating Costs
	 	 	3	 
	6.

	 	Tenant Payments and Additional Rent
	 	 	5	 
	7.

	 	Laws and Ordinances
	 	 	5	 
	8.

	 	Furniture; Fixtures; Electrical Equipment
	 	 	6	 
	9.

	 	Alterations
	 	 	6	 
	10.

	 	Damage
	 	 	7	 
	11.

	 	Condemnation
	 	 	7	 
	12.

	 	Use of Premises
	 	 	7	 
	13.

	 	Repairs by Tenant
	 	 	8	 
	14.

	 	Repairs by Landlord
	 	 	8	 
	15.

	 	Roof Rights
	 	 	8	 
	16.

	 	Landlord’s Remedies Upon Default
	 	 	8	 
	17.

	 	Insurance
	 	 	10	 
	18.

	 	Property at Tenant’s Risk
	 	 	11	 
	19.

	 	Assignment; Subletting
	 	 	11	 
	20.

	 	Signs
	 	 	13	 
	21.

	 	Rules and Regulations
	 	 	13	 
	22.

	 	Parking
	 	 	14	 
	23.

	 	Landlord Access
	 	 	14	 
	24.

	 	Subordination
	 	 	14	 
	25.

	 	Mortgagee Protection
	 	 	14	 
	26.

	 	Intentionally Deleted
	 	 	14	 
	27.

	 	Hold-Over
	 	 	14	 
	28.

	 	Estoppel Certificates
	 	 	15	 
	29.

	 	Quiet Enjoyment
	 	 	15	 
	30.

	 	Intentionally Deleted
	 	 	15	 
	31.

	 	Modifications Due to Financing
	 	 	15	 
	32.

	 	Attorneys
	 	 	15	 
	33.

	 	Notices
	 	 	15	 
	34.

	 	Applicable Law
	 	 	16	 
	35.

	 	No Reservation
	 	 	16	 
	36.

	 	Parties; Assigns and Successors
	 	 	16	 
	37.

	 	Severability
	 	 	16	 
	38.

	 	Rent Tax
	 	 	16	 
	39.

	 	Acts of God
	 	 	17	 
	40.

	 	Landlord’s Liability
	 	 	17	 
	41.

	 	Remedies Cumulative; No Waiver
	 	 	17	 
	42.

	 	Modification
	 	 	17	 
	43.

	 	Waivers
	 	 	17	 
	44.

	 	Interpretation
	 	 	17	 
	45.

	 	Financial Statements
	 	 	18	 
	46.

	 	Special Stipulations
	 	 	18	 
	47.

	 	Landlord’s Work
	 	 	18	 
	48.

	 	Right of First Offer
	 	 	19	 
	49.

	 	Option to Renew
	 	 	20	 
	50.

	 	Broker
	 	 	22	 






 









 






	 	 	 	 	 	 	 
	ARTICLE	 	TITLE	 	PAGE
	51.

	 	Building Sign
	 	 	22	 
	52.

	 	Outside Storage Area
	 	 	22	 
	53.

	 	Environmental Matters
	 	 	22	 
	54.

	 	License for Early Partial Occupancy
	 	 	23	 






EXHIBITS




	 	 	 
	A.

	 	Premises
	A-1.

	 	Early Occupancy Space
	B.

	 	Rules and Regulations
	C.

	 	Intentionally Omitted
	D.

	 	Commencement and Estoppel
	E.

	 	Outline of Landlord’s Work: Cold Dark Shell
	F.

	 	Chemical and Hazardous Materials
Inventory*






 




			
	*	 	This
exhibit to this agreement has not been included herewith, but will be
furnished supplementally to the Securities and Exchange Commission
upon request.




 











 






OFFICE LEASE




     THIS LEASE, made this 16th day of May, 1997, by and between B.F. SAUL REAL ESTATE
INVESTMENT TRUST (hereinafter “Landlord”); and BBI-BIOTECH RESEARCH LABORATORIES, INC., a
Massachusetts corporation (hereinafter “Tenant”).



WITNESSETH:



1.
Premises. For and in consideration of the rent hereinafter reserved and the mutual covenants
hereinafter contained,
Landlord does hereby lease and demise unto Tenant, and Tenant does hereby hire, lease and accept,
from Landlord, (i) Suite No.
1 containing approximately twenty-five thousand (25,000) rentable square feet of space (the “Gross
Area”) located at 215 Perry
Parkway (the “Building”), situated on Avenel Business Park, Gaithersburg, Maryland (the “Property”)
and (ii) the Outside Storage
Area and Flammable Storage Units Area (as defined in Article 52 below), all upon the terms and
conditions hereafter set forth.
That portion of the Gross Area which Tenant shall be entitled to occupy and the Outside Storage
Area and Flammable Storage
Units Area are hereinafter referred to as the “Premises” or “Demised Premises”, and is outlined in
red on the floor plan attached
hereto as Exhibit A and by this reference made a part hereof. It is specifically understood that
for purposes of calculating any
payments or pro-rations hereunder, the number of rentable square feet set forth above shall
control. The square footage of the
Premises shall be measured by Landlord’s architect in accordance with the Washington D.C.
Association of Realtors Standard
Method of Measurement dated January 1, 1989.



2.
Term. The term of this Lease shall commence on the date hereof (the “Lease Date”) and shall end
one hundred twenty
(120) months after the “Rent Commencement Date”, as hereinafter defined. The “Rent Commencement
Date” shall be the earlier
of (i) the date of the Premises is Substantially Complete (as hereinafter defined), or (ii) the
date Tenant actually commences
occupancy of the Premises. In the event the Rent Commencement Date is a date other than the first
day of a calendar month, the
term of the Lease shall run for the number of months set forth above from the first day of the
calendar month following the Rent
Commencement Date. The parties agree that they shall execute an agreement specifying the Rent
Commencement Date and
the date of termination of this Lease and such other matters as Landlord may require (the
“Commencement and Estoppel
Agreement” attached hereto as Exhibit D). Tenant agrees, to execute and deliver to Landlord said
agreement within ten (10)
business days’ after receipt of written notice from Landlord. If Tenant fails to execute and return
any such agreement to Landlord
within such ten (10) day period, then Landlord shall be entitled to collect from Tenant, as
liquidated damages with respect to such
default of Tenant in addition to Base Rent and other amounts payable hereunder, as Additional Rent,
an amount equal to one-half
of one percent (1/2%) of the then monthly amount of Base Rent then payable under this Lease, for
each day Tenant delays in
returning the requested agreement to Landlord.



3.
Rent. (a) Commencing with the Rent Commencement Date, Tenant shall pay annual “Base Rent” for
the Premises in
accordance with the schedule set forth below. All monthly installments of Rent shall be payable to
Landlord at the address specified
in Article 33 of this Lease, in advance, without previous notice or demand therefor, and without
deduction, setoff or recoupment,
with the first monthly installment to be due and payable no later than the Rent Commencement Date
and each subsequent monthly
installment to be due and payable on the first day of each and every month following the Rent
Commencement Date during the
term hereof. If the Rent Commencement Date is a date other than the first day of a month, Rent for
the period commencing with
and including the Rent Commencement Date until the first day of the following month shall be
pro-rated at the rate of one-thirtieth
(1/30th) of the fixed monthly rental per day.




     (i) Tenant shall pay Base Rent in the amount of Three Hundred Twenty-Five Thousand and No One
Hundredth Dollars ($325,000.00) per annum, payable in equal monthly installments of Twenty-Seven
Thousand Eighty-Three and Thirty-Three One Hundredth Dollars ($27,083.33) each for the period
commencing on the Rent Commencement Date and ending on the last day of the first Lease Year
inclusive;



1









 





     (ii) Tenant shall pay Base Rent in the amount of Three Hundred Thirty-Four Thousand Seven
Hundred Fifty and No One Hundredth Dollars ($334,750.00) per annum, payable in equal monthly
installments of Twenty-Seven Thousand Eight Hundred Ninety-Five and Eighty-Three One Hundredth
Dollars ($27,895.83) each for the period commencing on the first day of the second Lease Year and
ending on the last day of the second Lease Year inclusive;



     (iii) Tenant shall pay Base Rent in the amount of Three Hundred Forty-Four Thousand Seven
Hundred Ninety-Two and No One Hundredth Dollars ($344,792.00) per annum, payable in equal monthly
installments of Twenty-Eight Thousand Seven Hundred Thirty-Two and Sixty-Seven One Hundredth
Dollars ($28,732.67) each for the period commencing on the first day of the third Lease Year and
ending on the last day of the third Lease Year inclusive;



     (iv) Tenant shall pay Base Rent in the amount of Three Hundred Fifty-Five Thousand One
Hundred Thirty-Six and No One Hundredth Dollars ($355,136.00) per annum, payable in equal monthly
installments of Twenty-Nine Thousand Five Hundred Ninety-Four and Sixty-Seven One Hundredth
Dollars ($29,594.67) each for the period commencing on the first day of the fourth Lease Year and
ending on the last day of the fourth Lease Year inclusive;



     (v) Tenant shall pay Base Rent in the amount of Three Hundred Sixty-Five Thousand Seven
Hundred Ninety and No One Hundredth Dollars ($365,790.00) per annum, payable in equal monthly
installments of Thirty Thousand Four Hundred Eighty-Two and Fifty One Hundredth Dollars
($30,482.50) each for the period commencing on the first day of the fifth Lease Year and ending on
the last day of the fifth Lease Year inclusive;



     (vi) Tenant shall pay Base Rent in the amount of Three Hundred Eighty-Nine Thousand Two
Hundred Sixty-Four and No One Hundredth Dollars ($389,264.00) per annum, payable in equal monthly
installments of Thirty-Two Thousand Four Hundred Thirty-Eight and Sixty-Seven One Hundredth
Dollars ($32,438.67) each for the period commencing on the first day of the sixth Lease Year and
ending on the last day of the sixth Lease Year inclusive;



     (vii) Tenant shall pay Base Rent in the amount of Four Hundred Thousand Five Hundred
Sixty-Seven and No One Hundredth Dollars ($400,567.00) per annum, payable in equal monthly
installments of Thirty-Three Thousand Three Hundred Eighty and Fifty-Eight One Hundredth Dollars
($33,380.58) each for the period commencing on the first day of the seventh Lease Year and ending
on the last day of the seventh Lease Year inclusive;



     (viii) Tenant shall pay Base Rent in the amount of Four Hundred Twelve Thousand Two Hundred
Nine and No One Hundredth Dollars ($412,209.00) per annum, payable in equal monthly installments
of Thirty-Four Thousand Three Hundred Fifty and Seventy-Five One Hundredth Dollars ($34,350.75)
each for the period commencing on the first day of the eighth Lease Year and ending on the last
day of the eighth Lease Year inclusive;



     (ix) Tenant shall pay Base Rent in the amount of Four Hundred Twenty-Four Thousand Two
Hundred and No One Hundredth Dollars ($424,200.00) per annum, payable in equal monthly
installments of Thirty-Five Thousand Three Hundred Fifty and No One Hundredth Dollars ($35,350.00)
each for the period commencing on the first day of the ninth Lease Year and ending on the last day
of the ninth Lease Year inclusive;



     (x) Tenant shall pay Base Rent in the amount of Four Hundred Thirty-Six Thousand Five Hundred
Fifty-One and No One Hundredth Dollars ($436,551.00) per annum, payable in equal monthly
installments of Thirty-Six Thousand Three Hundred Seventy-Nine and Twenty-Five One Hundredth
Dollars ($36,379.25) each for the period commencing on the first day of the tenth Lease Year and
ending on the last day of the term of this Lease.



     (b) Landlord hereby acknowledges receipt of Twenty-Seven Thousand Eighty-Three and
Thirty-Three One Hundredth Dollars ($27,083.33) to be held as security for the performance by
Tenant of Tenant’s covenants and obligations under this Lease, it being expressly understood that
the deposit shall not be considered an advance payment of rental or a measure of Landlord’s damage
in case of default by Tenant. Upon the occurrence of any event of default by Tenant or breach by
Tenant of Tenant’s covenants under this Lease, Landlord may, from time to time, without prejudice
to any other remedy, use the security deposit to the extent necessary to make good any arrears of
rent and/or any damage, injury, expense or liability caused to Landlord by the event of default or
breach of covenant. In the event that Tenant shall fully and faithfully comply with all the terms,
conditions and



2









 




covenants of this Lease, any part of the security not used or retained by Landlord shall be
returned to Tenant after the expiration date of the term of this Lease and after delivery of
exclusive possession of the Premises to Landlord; provided, however, that Landlord may retain all
or a portion of the security until Landlord delivers to Tenant the final Annual Statement as
provided in Article 5(b) hereof.




     (c) When the square footage of the Premises is determined by Landlord’s architect, in
accordance with Article 1, the Base Rent, the computation of all additional charges payable by
Tenant under this Lease, and Landlord’s Contribution [as defined in Article 47(v) (iv)] that are
based on the Premises’ rentable square footage, shall be deemed automatically increased or
decreased based on the square footage as thus determined, and Landlord and Tenant shall execute
and deliver an agreement setting forth the rentable square footage of the Premises thus determined
and the proper Base Rent, Operating Costs, Real Estate Taxes, Pro-Rata Share and Landlord’s
Contribution, in proportion to such increase or decrease .



4. Rent Escalation.     (a) Intentionally deleted.




     (b) For all purposes of this Lease, the term “Lease Year” shall be defined to mean a period
of twelve (12) full calendar months. The first Lease Year shall commence on the Rent Commencement
Date (or on the first day of the first calendar month following the Rent Commencement Date if said
date is other than the first day of a calendar month), and each succeeding Lease Year shall
commence on the anniversary date of the beginning of the first Lease Year.


5. Annual Operating Costs. (a) Tenant agrees to pay to Landlord, as additional rent, its Pro-Rata
Share (as hereinafter defined) of Annual Operating Costs (as hereinafter defined).




     (b) Tenant shall pay to Landlord on the Rent Commencement Date and on the first day of each
calendar month thereafter, as its estimated monthly payment of the Annual Operating Costs, the sum of $7,916.67,
calculated at the rate of $3.80 per rentable
square foot, as may be adjusted upon the expiration of any applicable warranties related to
new construction. If the Rent
Commencement Date is a date other than the first day of the month, Tenant’s Pro-Rata share
shall be pro-rated in the same
manner as Base Rent under Article 3 hereof. Within one hundred eighty (180) days following
each fiscal year as determined by
Landlord during the term hereof, Landlord shall submit to Tenant a statement (the “Annual
Statement”) in reasonable detail of the
actual Annual Operating Costs. If such statement shows that Tenant’s share of the actual
Annual Operating Costs exceeded
Tenant’s monthly payments, then Tenant shall, within thirty (30) days of receipt of such
Annual Statement, pay the total amount
of such deficiency to Landlord. Thereafter, upon receipt of such succeeding Annual statement,
Tenant’s monthly payments during
the period covered by said Annual Statement shall be adjusted to the actual Annual Operating
Cost, and such adjustment shall
be paid within thirty (30) days of the date of said Statement. The amount of the actual Annual
Statement shall be used as the basis
for calculating Tenant’s monthly payments for the next succeeding twelve (12) month period;
notwithstanding the foregoing, in no
event shall Tenant’s Pro-Rata Share of Annual Operating Costs, excluding the Excluded Items (as
defined below) for the second
Lease Year of the Term or for any succeeding Lease Year increase by more than five percent
(5%) over the Annual Operating
Costs for the immediately preceding Lease Year; provided, however, that if the Annual
Operating Costs increase for any Lease Year
exceeds five percent (5%), then the amount of the Annual Operating Cost increase in excess of
five percent (5%) may be added
to the Annual Operating Cost increase for any succeeding Lease Year (or Lease Years) when the
Annual Operating Cost increase
is less than five percent (5%), so that, to the fullest extent possible (subject to the
maximum increase of five percent (5%) per Lease
Year in Annual Operating Costs provided for herein), Annual Operating Costs increases shall
reflect all increases in the Annual
Operating Costs occurring after the Lease Date; provided, however, that Tenants Pro-Rata Share
of Real Estate Taxes, snow
removal costs, utility rate increases, or insurance rate increases or any other cost Landlord
can reasonably demonstrate to be
increased beyond Landlord’s reasonable control (the “Excluded Items”) shall not be subject to
the above limitations on increases
in Annual Operating Costs, and Tenant shall be obligated to pay its full Pro-Rata Share of the
Excluded Items. Notwithstanding
anything contained herein to the contrary, after the fifth (5th) Lease Year, Tenant shall pay
its full Pro-Rata Share of Annual
Operating Costs, without any limitations.



     (c) All monthly payments as may be required hereunder shall be payable in full on the first
day of each of the calendar
month. Failure of the Landlord to provide any Annual Statement within the said one hundred
eighty (180) day period shall not
constitute a waiver by Landlord of its rights to payments due pursuant to this Article, and
the obligations hereunder shall survive
the expiration or other termination of this Lease.




3









 





     (d) For any applicable Fiscal Year that begins prior to the Rent Commencement Date or ends
after the expiration date of
this Lease, the amount due for that Fiscal Year shall be apportioned on a per diem basis so
that only that portion attributable to the
portion of such Fiscal Year that occurs during the term of this Lease, shall be payable by
Tenant.



     (e) The Tenant’s Pro-Rata Share as used herein is estimated to be 53.95% of the Annual
Operating Costs for the Building
and the Property. The rentable square footage of the Building is estimated to be 46,335.



     (f) Annual Operating Costs as used herein shall mean all costs of operation, maintenance and
repair of the Property,
(except structural repairs), and its appurtenances, and shall include the following by way of
illustration but not limitation: Real Estate
Taxes (as hereinafter defined), the cost of labor, materials and services for the operation,
maintenance and repair of the Building
and its appurtenances (including service roads and parking areas), including but not limited
to, water and sewer charges; heating,
ventilating and air conditioning maintenance and repairs; refuse and rubbish disposal; snow
removal; license, permits and inspection
fees; maintenance and service contracts; management fees in an amount customarily charged in
Avenel Business Park; all
landscaping costs (including upgrades and replacements thereto); parking lot lighting;
watchman, guards, and any personnel
engaged in the operation, maintenance or repair of the Property and its appurtenances together
with payroll taxes and employee
benefits applicable thereto; reserve for asphalt and roof repairs; Landlord’s administrative
costs equal to fifteen percent (15%) of
the Annual Operating Costs (excluding Real Estate Taxes); and insurance. Any of the services,
supplies or materials which may
be included in the computation of Annual Operating costs for the Property may be performed by
subsidiaries or affiliates of
Landlord; provided, however, with the exception of the foregoing management fees and
administrative costs, such costs shall be
in the customary amounts. Notwithstanding the foregoing to the contrary, Operating Costs shall
not include: (i) expenses incurred
in leasing or procuring tenants (including lease commissions, advertising expenses and
expenses of renovating space for tenants);
(ii) interest or amortization on any mortgages or deeds of trust; (iii) depreciation or
capital improvements costs with respect to the
Building, the Property or any equipment, machinery, fixtures or improvements therein, except
for amortization of the cost of
improvements or equipment which are capital in nature and which are installed for the purpose
of either (i) reducing Operating Costs
of the Building or (ii) complying with any laws, ordinances, rules and regulations first
taking effect after the Lease Commencement
Date (and all of such permitted capital costs shall be amortized on a straight-line basis over
the useful life of the capital
improvement (s) in question, such useful life being deemed the longest period permissible by IRS
regulations, with only the annual
amortized portion being included in Operating Costs for such Lease Year); (iv) legal fees and
other expenses incurred by Landlord
or agents in connection with negotiations or disputes with tenants or prospective tenants for
the Building; (v) any item for which
Landlord is reimbursed by insurance or otherwise compensated for, including direct
reimbursement by any tenant or occupant; (vi)
any items which are performed under warranty for which no payment is required to be made by
Landlord; and (vii) except as
provided above, reserves. For the purposes of this Lease, the capitalizable cost of any
capital improvement items shall be
determined in accordance with generally-accepted accounting principles consistently applied.



     (g) The term “Real Estate Taxes” means all taxes, rates and assessments, general and special,
levied or imposed with
respect to the land, buildings and improvements comprising the Property, including all taxes,
rates and assessments, general and
special, levied or imposed for schools, public betterment, general or local improvement and
operations and taxes imposed in
connection with any special taxing district. If the system of real estate taxation shall be
altered or varied and any new tax or levy
shall be levied or imposed on said land, buildings and improvements, and/or Landlord in
substitution for real estate taxes presently
levied or imposed on immovables in the jurisdiction where the Building is located, then any
such new tax or levy shall be included
within the term “Real Estate Taxes”. Should any governmental taxing authority acting under any
regulation, levy, assess, or impose
a tax, excise and/or assessment however described (other than an income or franchise tax)
upon, against, on account of, or
measured by, in whole or in part, the rent expressly reserved hereunder, or upon the rent
expressly reserved under any other leases
or leasehold interests in the Property, as a substitute (in whole or in part) or in addition
to any existing real estate taxes on land and
buildings and otherwise, such tax or excise on rents shall be included within the term “Real
Estate Taxes”. In the event Landlord
is required to pay Real Estate Taxes in advance, Tenant agrees that Landlord shall immediately
be entitled to reimbursement
therefor. Reasonable expenses (consisting of attorneys’ fees, consulting fees, expert witness
fees and similar costs) incurred by
Landlord in obtaining or attempting to obtain a reduction of any Real Estate Taxes shall be
added to and included in the amount
of any such Real Estate Taxes. Real Estate Taxes which are being contested by Landlord shall
nevertheless be included for
purposes of the computation of the liability of Tenant under this Article, provided, however,
that in the event that Tenant shall have
paid any amount of increased rent pursuant to this Article 5 and the Landlord shall thereafter
receive a refund of any portion of any
Real Estate Taxes on which such payment shall have been based, Landlord shall pay to Tenant
the appropriate portion of such



4









 




refund. Landlord shall have no obligation to contest, object to or litigate the levying or
imposition of any Real Estate Taxes and may settle, compromise, consent to, waive or otherwise
determine in its discretion to abandon any contest with respect to the amount of any Real Estate
Taxes without consent or approval of the Tenant. The obligation to pay Real Estate Taxes accruing
during the term, and Landlord’s obligation to refund to Tenant any overpayment, shall survive the
expiration of this Lease.



6. Tenant Payments and Additional Rent. (a) Tenant shall (i) pay directly for all utility services
provided for the
benefit of the Tenant, including all charges associated with the metering or sub-metering therefor;
(ii) pay directly for all telephone
charges; and (iii) be responsible for the prompt and sanitary storage of Tenant’s refuse and
rubbish in the Premises.




     (b) Any amounts required to be paid by Tenant hereunder and any charges or expenses incurred
by Landlord on behalf of Tenant under the terms of this Lease shall be considered additional rent
payable in the same manner and upon the same terms and conditions as the rent reserved hereunder.
Any failure on the part of Tenant to pay such additional rental when and as the same shall become
due shall entitle Landlord to the remedies available to it for non-payment of rent. Tenant’s
failure to object to any statement, invoice or billing rendered by the Landlord within a period
of sixty (60) days after receipt thereof shall constitute Tenant’s acquiescence with respect
thereto, and such statement, invoice or billing shall thereafter be deemed to be correct and
shall be an account stated between Landlord and Tenant. Landlord shall, within twenty (20) days
after receipt of written request by Tenant, allow Tenant, at its sole cost and expense, to
inspect and copy in Landlord’s offices, any and all reasonable backup information and
documentation pertaining to such charges or expenses incurred by Landlord on behalf of Tenant. If
Tenant requests that Landlord prepare, review, or execute any document, consent or waiver in
connection with this Lease or otherwise, Tenant shall be obligated to pay to Landlord, as
Additional Rent, a reasonable fee, in the amount set forth on a fee schedule adopted by Landlord
from time to time, to compensate Landlord for the cost of reviewing and processing any such
request, and Landlord shall not be obligated to process any such request of Tenant until Tenant
has paid Landlord the applicable processing fee. Landlord will supply Tenant with a copy of
Landlord’s then current processing fee schedule upon Tenant’s request. Nothing herein shall be
deemed to require that Landlord consent to, execute or approve any document, consent or waiver
submitted to Landlord by Tenant notwithstanding Tenant’s payment of the applicable processing
fee.


7. Laws
and Ordinances. (a) Tenant will, at its own cost, promptly comply with and carry out all
orders, requirements or
conditions now or hereafter imposed upon it during the Lease Term, by the ordinances, laws and/or
regulations of the municipality,
county and/or state in which the Premises are located and which affect Tenant’s occupancy of the
Premises or are as a result of
Tenant’s use and occupancy of the Premises (“Legal Requirements”), whether required of Landlord or
otherwise, in the conduct
of Tenant’s business, including, without limitation, all local, state and federal laws and
regulations respecting the storage, handling
and use of any hazardous waste, infectious waste or other hazardous materials, except that Landlord
shall comply with any orders,
laws rules or regulations affecting structural walls and columns, roof or other Common Facilities
(as hereinafter defined) unless
due to Tenant’s particular business or use of the Premises. However, Tenant shall not be required
to comply financially or
otherwise, with any such ordinance, law and/or regulation not required to be complied with during
the Lease Term unless the same
is a result of Tenant’s use and occupancy and are required to be complied with prior to turnover
to Landlord at the expiration or earlier termination of this Lease. Tenant will indemnify and
save Landlord harmless from all penalties, claims, and demands resulting from Tenant’s failure or
negligence in this respect. “Common Facilities” means all areas provided by Landlord, from time
to time, for the common or joint use and benefit of the occupants of the Building and their
employees, agents, servants, customers and other invitees, including management offices, parking
areas, parking decks, access roads, driveways, retaining walls, landscaped areas, truck service
ways, sidewalks, parcel pickup stations and common electrical and plumbing systems, except to the
extent such systems exclusively serve the Premises. Notwithstanding anything contained herein to
the contrary, if, after the initial improvements to the Premises, Tenant is obligated to make
alterations to the Premises pursuant to any law, order, rule or regulation, Landlord’s consent
shall not be unreasonably withheld. Tenant shall provide Landlord with written notice of any such
legal requirement, including therewith documentation indicating the legal requirement for such
alteration and detailed plans showing the work proposed to be done to comply with such legal
requirement.




     (b) Tenant shall have the right to contest the validity of any law or its application to the
Premises at Tenant’s sole cost and expense, unless such contest would cause any criminal or civil
liability or any fine or other penalty to be imposed upon Landlord. Tenant shall defend,
indemnify and hold landlord harmless from and against all costs, expenses (including reasonable
attorney fees), claims, fines, or other liability resulting from any such contest of legal
requirements by Tenant.



5









 




8.
Furniture; Fixtures; Electrical Equipment. (a) Tenant shall not place a load upon the floor of
the Premises
exceeding one hundred twenty-five (125) pounds per square foot without Landlord’s prior written
consent. Business machines,
mechanical equipment and materials in the Premises which cause vibration, noise, cold, heat or
fumes that may be transmitted
to the Building or to any other leased space therein to such a degree as to be objectionable to
Landlord or to any other tenant in
the Building shall be placed, maintained, isolated, stored and/or vented by Tenant at its sole
expense so as to absorb and prevent
such vibration, noise, cold, heat or fumes. Subject to Article 53, Tenant shall not keep within or
about the Premises any dangerous,
inflammable, toxic or explosive material. Tenant shall indemnify Landlord and hold it harmless
against any and all damage, injury,
or claims resulting from the moving of Tenant’s equipment, furnishings and/or materials into or out
of the Premises or from the
storage or operation of the same. Any and all damage or injury to the Premises, the Building, or
the Property caused by such
moving, storage or operation shall be repaired by Tenant at
Tenant’s sole cost.




     (b) Tenant shall not install any equipment whatsoever which will or may necessitate any
changes, replacements or additions to the water system, plumbing system, heating system, air
conditioning system or the electrical system of the Premises without the prior written consent of
Landlord. Tenant shall, at its sole cost and expense, pay all charges for electricity used by the
Tenant during the term of this Lease, including that used for interior lighting and the operation
of the heating and air conditioning system in the Premises.


9.
Alterations. (a) Tenant shall make no alterations or changes, structural or otherwise, to any
part of the Premises, either
exterior or interior, without Landlord’s written consent. In the event of any such approved changes,
Tenant shall have all work done
at its own expense. Request for such consent shall be accompanied by plans stating in detail
precisely what is to be done.
Notwithstanding the foregoing to the contrary, Tenant may make non-structural, cosmetic alterations
to the interior of the Premises
with Landlord’s written consent which shall not be unreasonably withheld. Tenant shall comply with
the building codes, regulations
and laws now or hereafter to be made or enforced in the municipality, county and/or state, which
pertain to such work. Any
additions, improvements (made after the initial improvements to the Premises), alterations and/or
Installations made by Tenant
(except only office furniture, business equipment and trade fixtures including, but not limited to,
wet laboratories, cabinetry, benches
and scientific equipment; provided Tenant shall repair any damage to the Premises upon removal of
same) shall become and
remain a part of the Building and be and remain Landlord’s property upon the termination of
Tenant’s occupancy of said Premises;
provided, however, Landlord shall notify Tenant, at the time Tenant requests Landlord’s approval to
make alterations, that Landlord
will or will not require Tenant to remove the proposed alterations from the Premises upon the
expiration or earlier termination of
this Lease. If Landlord requires Tenant to remove such alterations as aforesaid, Tenant shall
remove same, repair any damage
to the Premises upon removing same, and restore the Premises to the condition the Premises were in
upon delivery of same to
Tenant, at Tenant’s sole cost and expense, ordinary wear and tear and damage due to casualty not
required to be repaired by
Tenant excepted. Tenant shall save Landlord harmless from and against all expenses, liens, claims
or damages to either property
or person which may or might arise by reason of the making of any such additions, improvements,
alterations and/or installations.
Landlord reserves the right, subject to Articles 22 and 52, to change, increase or reduce, from
time to time, the number,
composition, dimensions or location of any parking areas, signs, the Building name, service areas,
walkways, roadways or other
common areas or make alterations or additions to the Building, in its sole discretion. Landlord’s
approval of Tenant’s plans and
specifications under this Article 9 or any other provisions of this Lease is solely for the purpose
of ascertaining whether Tenant’s
proposed alterations will have an adverse impact on the structural components or Common Facilities
of the Building and to insure
the aesthetic and architectural harmony of the Tenant’s proposed alterations with the remainder of
the Building. No approval of
plans by Landlord shall be deemed to be a representation or warranty by Landlord that such plans or
the work provided for therein
will comply with applicable codes, laws or regulations or be in conformance with any insurance or
other requirements which affect
the Premises or the Building, and Tenant shall have the sole responsibility of complying with all
such requirements notwithstanding
Landlord’s approval of Tenant’s plans.




     (b) NOTICE IS HEREBY GIVEN THAT LANDLORD SHALL NOT BE LIABLE FOR ANY LABOR OR MATERIALS
FURNISHED OR TO BE FURNISHED TO TENANT UPON CREDIT, AND THAT NO MECHANICS’ OR OTHER LIEN FOR ANY
SUCH LABOR OR MATERIALS SHALL ATTACH TO OR AFFECT THE ESTATE OR INTEREST OF LANDLORD IN AND TO THE
PREMISES OR THE BUILDING. WHENEVER AND AS OFTEN AS ANY LIEN ARISING OUT OF OR IN CONNECTION WITH
ANY WORK PERFORMED, MATERIALS FURNISHED OR OBLIGATIONS INCURRED BY OR ON BEHALF OF TENANT SHALL
HAVE BEEN FILED AGAINST THE PREMISES OR THE BUILDING, OR IF ANY CONDITIONAL BILL OF SALE SHALL
HAVE BEEN FILED FOR OR AFFECTING ANY MATERIALS, MACHINERY OR FIXTURES USED IN THE CONSTRUCTION,



6









 




REPAIR OR OPERATION THEREOF, OR ANNEXED THERETO BY TENANT, TENANT SHALL FORTHWITH TAKE SUCH ACTION
BY BONDING, DEPOSIT OR PAYMENT AS WILL REMOVE OR SATISFY THE LIEN OR CONDITIONAL BILL OF SALE
WITHIN TEN (10) DAYS OF LANDLORD’S WRITTEN REQUEST THEREFOR.



10.
Damage. (a) If the Premises are damaged by fire or other cause covered by Landlord’s policy of
fire insurance with
extended coverage or other property damage insurance carried by Landlord, the damage shall be
repaired by and at the expense
of Landlord and the rent until such repairs shall have been made shall abate pro-rata according to
the part of the Premises which
is unusable by Tenant. However, if such damage was caused by the negligence of Tenant, its
employees, agents, contractors,
visitors or licensees, then all rentals shall be payable by Tenant during such period, unless and
solely to the extent that any
abatement of rent is covered by a policy of rent loss insurance which Landlord may, at its option,
then have in effect. Due allowance
shall be made for reasonable delay which may arise by reason of adjustment of fire insurance by
Landlord, and for personnel delay
on account of “labor troubles” or any other cause beyond Landlord’s control. If, however, the
Premises are rendered wholly
untenantable by fire or other cause and Landlord shall decide not to rebuild the same, or if the
entire Building be so damaged that
Landlord shall decide to demolish it or not to rebuild it, then or in any of such events, Landlord
may, at its option, cancel and
terminate this Lease by giving Tenant notice in writing of its intention to cancel this Lease,
whereupon the term of this Lease shall
terminate upon the thirtieth (30th) day after such notice is given, and Tenant shall vacate the
Premises and surrender the same
to Landlord. In neither of the certain contingencies in this paragraph mentioned shall there be any
liability on the part of Landlord
to Tenant covering or in respect of any period during which the occupation of said Premises by
Tenant may not be possible because
of the matters hereinabove stated, nor shall Landlord be liable for any damage incurred by Tenant.
Without limiting the foregoing,
Landlord shall not be responsible for consequential damages, lost profits or any damage to Tenant’s
personal property.




     (b) Notwithstanding anything to the contrary contained in this Lease, if the Premises are
damaged or destroyed by fire, accident, the elements or other casualty (a “Casualty”) during the
term, Landlord shall notify Tenant within thirty (30) days after such Casualty of Landlord’s good
faith estimate of the time needed to undertake reconstruction of the Premises. If the estimated
time for repairs to the Premises exceeds one hundred eighty (180) days from the date of Casualty,
Tenant shall have the right to terminate this Lease by giving to Landlord notice of such
termination within fifteen (15) days after Landlord provides notice of such good faith estimate.
In the event that Landlord or Tenant do not exercise a right of termination as provided in this
Lease, Landlord shall commence to repair the damage caused by such Casualty and, thereafter, shall
diligently and continuously pursue completion of such repairs, within the estimated completion
date as set forth in Landlord’s notice. If Landlord fails to so complete the repairs to the extent
sufficient to allow Tenant to reasonably use and occupy the Premises for its intended use, within
the estimated completion date, Tenant shall have the right and option, as its sole and exclusive
remedy upon no less than sixty (60) days prior notice to Landlord to terminate this Lease;
provided, however, that if Landlord completes its repairs within said sixty (60) day period, then
Tenant’s notice to terminate as aforesaid shall be null and void and this Lease shall continue in
full force and effect.


11.
Condemnation. If the Premises or any part thereof shall be taken by any governmental or
quasi-governmental authority
pursuant to the power of eminent domain, or by deed in lieu thereof, Tenant agrees to make no claim
for compensation in the
proceedings, and hereby assigns to Landlord any rights which Tenant may have to any portion of any
award made as a result of
such taking, and this Lease shall terminate as to the portion of the Premises taken by the
condemning authority and rental shall
be adjusted to such date. The foregoing notwithstanding, Tenant shall be entitled to claim, prove
and receive in the condemnation
proceedings such awards as may be allowed for relocation expenses and for fixtures and other
equipment installed by it which shall
not, under the terms of this Lease, be or become the property of Landlord at the termination
hereof, but only if such awards shall
be made by the condemnation court in addition to and stated separately from the award made by it
for the land and the Building
or part thereof so taken. If the nature, location or extent of any proposed condemnation affecting
the Building is such that Landlord
elects in good faith to demolish the Building, then Landlord may terminate this Lease by giving at
least sixty (60) days’ written notice
of termination to Tenant at any time after such condemnation and this Lease shall terminate on the
date specified in such notice.
If the Premises shall be taken by any governmental or quasi-governmental authority pursuant to the
power of eminent domain, on
a temporary basis exceeding one hundred eighty (180) days, then Tenant shall have the right to
terminate this Lease with thirty (30)
days prior written notice to Landlord.



12. Use
of Premises. The Premises shall be used and occupied by Tenant solely for the purpose of a
scientific research and
laboratory facility, including a scientific/biomedical testing laboratory, test kit
production/assembly facility, and for activities related
thereto, including the storage of the chemicals and materials in strict accordance with Article 53
and Exhibit F used by Tenant in





7









 







the conduct of its business in the Premises, and general office purposes, and for no other purpose
whatsoever. The Premises shall not be used for any illegal purpose or in violation of any valid
regulation of any governmental body, or in any manner to (i) create any nuisance or trespass; (ii)
annoy or embarrass Landlord or any other tenant of the Property; (iii) vitiate any insurance; or
(iv) alter the classification or increase the rate of insurance on the property.



13.
Repairs by Tenant. Tenant shall be responsible for repairing, maintaining and cleaning the
Premises and the fixtures
therein, keeping same in good order and condition during the term of this Lease at its sole cost
and expense, and will, at the
expiration or other termination of the term hereof, surrender and deliver up the same and all keys,
locks and other fixtures
connected therewith (except only trade fixtures installed by Tenant at Tenant’s expense, office
furniture and business equipment)
in safe, clean, sanitary, and non-hazardous condition, and otherwise in good order and condition,
as the same were required to be
in on the date Tenant occupied the Premises for the conduct of Tenant’s business, ordinary wear and
tear excepted.



14.
Repairs by Landlord. Landlord shall have no duty to Tenant to make any repairs or improvements
to the interior of the
Premises except structural repairs necessary for safety and tenantability, and then only if not
brought about by any act or neglect
of Tenant, its agents, employees or invitees, excluding accidents covered by Landlord’s insurance,
subject to Article 17(f). Unless
due to Landlord’s gross negligence or willful misconduct, Landlord shall not be liable for any
damage caused to the person or
property of Tenant, its agents, employees or invitees, due to the Properly or the Building or any
part or appurtenances thereof being
improperly constructed or being or becoming out of repair, or arising from the leaking of water or
sewer, or from electricity, or from
any other cause whatsoever. Tenant agrees to use commercially reasonable efforts to report as soon
as practicable under the
circumstances, in writing to Landlord any defective condition in or about the Premises known to
Tenant which Landlord is required
to repair, and a failure to so report shall make Tenant liable to Landlord for any expense, damage
or liability resulting from such
defects. Landlord shall not be liable for failure to furnish or for suspension or delay in
furnishing such services due to breakdown,
maintenance, or repair work, strike, riot, civil commotion, governmental action or any other cause
beyond the reasonable control
of Landlord, or for interruptions of service for reasonable periods in connection with construction
work being performed in the
Building. If such interruption is caused by the gross negligence or willful misconduct of Landlord,
its agents or employees, and
Tenant is precluded from being open for business within the Premises for a period of seventy-two
(72) continuous hours, and
provided that business interruption insurance that may be carried by Tenant, at its option, at the
time in question would not provide
reimbursement to Tenant for rental payments during this period, then Tenant’s Base Rent and other
charges shall abate
commencing after such seventy-two (72) hour period, until the earlier of the date on which such
utility service is restored or the date
the Tenant reopens for business.



15.
Roof Rights. Except as otherwise provided in this Lease, Landlord shall have the exclusive
right to use all or any portion
of the roof of the Building for any purposes. Landlord shall use commercially reasonable efforts
in exercising its rights under this
paragraph to minimize any undue noise that may unreasonably interfere with Tenants use and
occupancy of the Premises.



16.
Landlord’s Remedies Upon Default. Tenant shall be in default under this Lease if Tenant (i)
fails to pay any Installment
of Base Rent, Additional Rent or other charges or money obligation to be paid by Tenant hereunder
within five (5) days after the
same shall become due (all of which monetary obligations of Tenant shall bear interest at the
highest rate allowable by law, not
to exceed 18% per annum from the date due until paid); or (ii) defaults in the performance of any
of the covenants, terms or
provisions of this Lease (other than the payment, when due, of any of Tenant’s monetary obligations
hereunder) or any of the Rules
and Regulations now or hereafter established by Landlord to govern the operation of this Building
and fails to cure such default
within twenty (20) days after written notice thereof from Landlord; provided, however, that solely
with respect to non-monetary
defaults which cannot with due diligence be cured within such 20-day period, if, within such 20-day
period, Tenant commences and
thereafter diligently pursues the cure of any such non-monetary default, Tenant shall be granted an
additional reasonable period
of time to effect a cure, but in no event later than sixty (60) days after the date Tenant
commences to cure the default; or (iii)
abandons the Premises or fails to keep the Premises continuously and uninterruptedly open for
business; or (iv) files a voluntary
petition in bankruptcy, or any similar petition seeking relief under any present or future federal,
or other bankruptcy or insolvency
statue or law; or if a proceeding under any present or future federal, state or other bankruptcy or
insolvency statute or law shall be
filed against Tenant or any asset of Tenant, and such proceeding shall not have been dismissed or
vacated within ninety (90) days
of the date of such filing; or (v) makes an assignment for the benefit of its creditors. Upon the
occurrence of any of the above
events, Landlord, at its option, may pursue any one or more of the following remedies without any
notice or demand whatsoever:



8









 







     (a) Landlord, at its option, may at once, or at any time thereafter, terminate this Lease by
written notice to Tenant,
whereupon this Lease shall end. Upon such termination by Landlord, Tenant will at once
surrender possession of the Premises
to Landlord and remove all of Tenants’s effects therefrom, and Landlord may forthwith re-enter
the Premises and repossess itself
thereof, and remove all persons and effects therefrom, in accordance with law; provided,
however, Landlord agrees that it will not
breach the peace in the exercise of its rights herein. Notwithstanding the foregoing to the
contrary, solely with respect to monetary
defaults as provided in clause (i) above, Landlord agrees that it shall not exercise its right
of re-entry as provided herein without a
court order, unless Tenant has failed to cure said monetary default within five (5) days’
after receipt of written notice from Landlord.



     (b) Landlord may, without terminating this Lease, enter upon and take possession of the
Premises and expel or remove
Tenant and any other person who may be occupying the Premises or any part thereof, without
being liable for prosecution or any
claim for damages therefor and, if Landlord so elects, make such alterations and repairs as,
in Landlord’s judgement, may be
necessary to relet the Premises, and relet the Premises or any part thereof for such rent and
for such period of time and subject
to such terms and conditions as Landlord may deem advisable and receive the rent therefor;
provided, however, Landlord agrees
that it will not breach the peace in the exercise of its right herein. Notwithstanding the
foregoing to the contrary, solely with respect
to monetary defaults as provided in clause (i) above, Landlord agrees that it shall not
exercise its right of re-entry as provided herein
without a court order, unless Tenant has failed to cure said monetary default within five (5)
days’ after receipt of written notice from
Landlord. Upon each such reletting, the rent received by Landlord in respect of such resetting
shall be applied first to the payment
of any indebtedness other than rent due hereunder from Tenant to Landlord, including interest
thereon; second, to the payment
of any loss and expenses of such reletting, including brokerage fees, attorneys’ fees and the
cost of such alterations and repair;
third, to the payment of rent due and unpaid hereunder, together with interest thereon as
herein provided; and the residue, if any,
shall be held by Landlord and applied in payment of future rent as the same may become due and
payable hereunder. Tenant
agrees to pay to Landlord, on demand, any deficiency that may arise by reason of such
reletting. Notwithstanding any such reletting
without termination, Landlord may at any time thereafter elect to terminate this Lease for
such prior default.



     (c) In the event Landlord shall re-enter the Premises and/or terminate this Lease in
accordance with the provisions of this
Article 16, Landlord may, in addition to any other remedy it may have, recover from Tenant all
damages and expenses Landlord
may suffer or incur by reason of Tenant’s default hereunder, including without limitation ,
the cost of recovering the Premises and
reasonable attorney fees. Tenant agrees that actual damages to Landlord resulting from
Landlord’s exercise of the remedies set
forth in paragraphs (a) or (b) above, will be difficult to ascertain, and therefore, after a
default of Tenant hereunder, Tenant shall
also pay to Landlord “Liquidated Damages” for the failure of Tenant to observe and perform the
covenants of this Lease, which
at the election of Landlord, shall be either: (A) (x) the sum of
(i) the minimum monthly rent,
plus (ii) the Additional Rent payable
hereunder for the month immediately preceding such failure to operate, re-entry or
termination, less (z) the net amount, if any, of
the rents collected on account of the lease or leases of the Premises for each month of the
period which would otherwise have
constituted the balance of the term of this Lease, all of which sums shall become due and
payable by Tenant to Landlord upon
the first day of each calendar month during the otherwise unexpired portion of the term
hereof; or (B) the whole of said Liquidated
Damages calculated under clause (A) multiplied by the number of months then remaining in the
lease term, discounted to present
value at a rate of six percent (6%) per annum as of the date of termination or re-entry by
Landlord; provided, however, that in the
event Landlord shall relet the Premises and the rent received by Landlord in respect of such
reletting together with the discounted
Liquidated Damages paid by Tenant, less the costs and expenses incurred by Landlord in such
reletting, shall exceed the rent
reserved hereunder for that period which would otherwise have constituted the remainder of the
term hereof, then Landlord shall,
upon the expiration of the period which would have constituted the term of this Lease, refund
to Tenant the lesser of the amount
of such excess or the discounted Liquidated Damages theretofore paid by Tenant.



     (d) If the rent agreed to be paid, including all other sums of money which under the
provisions hereto are declared to be
rent, shall be in arrears in whole or in part for five (5) or more days, Landlord may at its
option (if such arrearage remains unpaid
after ten (10) days’ written notice to Tenant) declare the tenancy hereunder converted into a
tenancy from month to month, and
upon giving written notice to Tenant of the exercise of such option, Landlord shall forthwith
be entitled to all provisions of law relating
to the summary eviction of monthly tenants in default in rent.



     (e) Anything in this Lease to the contrary notwithstanding, in order to cover the extra
expense involved in handling
delinquent payments, Tenant shall pay a “late charge” in an amount equal to the greater of (i)
5% of any delinquent payment, or
(ii) $250.00, when any installment of Base Rent (or any other amount as may be considered
Additional Rental under this Lease)




9












 




is paid more than five (5) days after the due date thereof. It is hereby understood that this
charge is for extra expenses incurred by the Landlord in processing the delinquency.




     (f) Tenant hereby appoints as its agent to receive service of all dispossessory or other
proceedings and notices thereunder and under this Lease the person apparently in charge of the
Premises at the time, and if no person then appears to be in charge of the Premises, then such
service or notice may be made by attaching the same to the main entrance of the Premises, provided
that, in such later event, a copy of any such proceedings or notice shall also be mailed to Tenant
in the manner set forth in Article 33 hereof.



     (g) Tenant shall
be considered in “Habitual Default” of this Lease upon (i) Tenant’s failure,
on two (2) or more occasions during any Lease Year, to pay, when due, any installment of Base Rent,
Additional Rent, or any other sum required by the terms of this Lease, or (ii) Tenant’s repeated (on
three (3) or more occasions) violation of, or failure to comply with, any term covenant or
condition of this Lease after written notice of such violation or failure to comply has been given
by Landlord to Tenant. Upon the occurrence of an event of Habitual Default on the part of Tenant,
Tenant shall immediately be deemed to have released any and all options or rights granted, or to be
granted, to Tenant under the terms of this Lease (including, without limitation, rights of renewal,
rights to terminate, or rights of first refusal).



     (h) Pursuit of any of the foregoing remedies shall not preclude Landlord from pursuing any
other remedies therein or at law or in equity provided, nor shall pursuit of any remedy by Landlord
constitute a forfeiture or waiver of any rent due to Landlord hereunder or of any damages accruing
to Landlord by reason of Tenant’s violation of any of the covenants and provisions of this Lease.
Tenant hereby waives any right to assert or maintain any non-compulsory counterclaims against
Landlord in any action brought by Landlord to obtain possession of the Premises. No act of Landlord
(including, without limitation, acts of maintenance, efforts to relet the Premises, or any other
actions taken by Landlord or its agents to protect Landlord’s interests under this Lease) other
than a written notice of termination, shall terminate this Lease. The acceptance of keys to the
Premises by Landlord, its agents, employees, contractors or other persons on Landlord’s behalf
shall not be deemed or constitute to effect a termination of this Lease unless such early
termination is evidenced by a written instrument signed by Landlord.


17. Insurance (a) Tenant agrees to indemnify and save Landlord and Landlord’s Managing Agent
harmless from any and all liabilities, damages, causes of action, suits, claims, judgements, costs
and expenses of any kind (including attorneys fees): (i) relating to or arising from or in
connection with the possession, use, occupancy, management, repair, maintenance or control of the
Premises, or any portion thereof; (ii) arising from or in connection with any act or omission of
Tenant or Tenant’s agents, employees or invitees; or (iii) resulting from any default, violation or
injury to person or property or loss of life sustained in or about the Premises. To assure such
indemnity, Tenant shall carry and keep in full force and effect at all times during the term of
this Lease for the protection of Landlord and Landlord’s Managing Agent and Tenant herein, public
liability and property damage insurance with combined single limits of not less than One Million
Dollars ($1,000,000.00) per occurrence; with not less than a Two Million Dollar ($2,000,000.00)
aggregate per location.




     (b) Tenant shall be and remain liable for the maintenance, repair and replacement of all plate
glass in the Premises with glass of like kind and quality. If requested by Landlord, Tenant shall
keep the same insured under a policy of place glass Insurance.



     (c) Tenant shall obtain and at all times during the term hereof maintain, at its sole cost and
expense, policies of insurance covering its fixtures, equipment and inventory installed and
located on the Premises, in an amount of not less than eighty percent (80%) of the replacement cost
of said items. Such insurance shall cover any peril included under insurance industry practice in
the state in which the Property is located, within the classification “Fire and Extended Coverage”
together with insurance against vandalism, malicious mischief, and sprinkler leakage or other
sprinkler damage, boiler and pressure vessel insurance, and any proceeds of such insurance so long
as this Lease shall remain in effect, shall be used only to repair or replace the items so insured.



     (d) Said public liability and property damage insurance policies and any other insurance
policies carried by Tenant with respect to the Premises shall: (i) be issued in form reasonably
acceptable to Landlord by good and solvent insurance companies qualified to do business in the
state in which the Premises is located and reasonably satisfactory to Landlord; (ii) be endorsed to
name Landlord, Landlord’s Managing Agent, Tenant and any other parties in interest from time to
time designated in writing by notice from Landlord to Tenant as Additional Insureds; (iii) be
written as primary policy coverage and not contributing either to or



10









 







in excess of any coverage which Landlord may carry; (iv) provide for 30 days’ prior written notice
to Landlord of any cancellation or other expiration of such policy or any defaults or material
changes thereunder; and (v) contain an express waiver of any right of subrogation by the insurance
company against Landlord and Landlord’s Managing Agent. Such insurance policies shall be obtained
from an approved insurance company and Tenant shall deliver a copy of said policy or an original
Certificate of Insurance to Landlord, before Tenant takes occupancy of the Premises, showing the
same to be in full force and effect. Neither the issuance of any insurance policy required
hereunder, nor the minimum limits specified herein with respect to Tenant’s insurance coverage
shall be deemed to limit or restrict in any way Tenant’s liability arising under or out of this
Lease.



     (e) In addition to the indemnity and insurance provision stipulated in this Article 17, the
Tenant shall also obtain and at all times during the term of this Lease maintain the following
additional insurance of the type marked below with an “X”:




	 	 	 	Gradual Pollution and/or Contamination Liability
	 
	 	X	 	Umbrella Liability in limits of not less than Two Million Dollars ($2,000,000.00)





     (f)(1) Notwithstanding
anything contained herein to the contrary, to the extent permitted by
law, each of Landlord and Tenant hereby releases the other, to the extent of all insurance carried
(or required to be carried) by each party under the terms of this Lease, from liability for any
loss or damage caused by fire or other of the extended casualties insured against; provided,
however, that this release shall be in force and effect only with respect to loss or damage
occurring during such time as the releasing party’s insurance policy contain a clause or clauses
which provides that: (i) the insurance company waives subrogation or consents to a waiver of right
of recovery, and (ii) such waiver of subrogation or consent to a waiver of a right of recovery
does not adversely affect or prejudice said policy or the releasing party’s right of full recovery
thereunder. Landlord’s release of Tenant under this subparagraph 17(f) is expressly conditioned
upon Tenant’s full cooperation with Landlord’s insurance carrier in inspections of the Premises
and Tenant’s compliance with all requirements imposed by Landlord’s insurance carrier with respect
to any activities in or use of the Premises which increases the risk of loss to the Building or
the Premises.



     (2) If a party advises the other party that a clause of the type described in paragraph (1)
above is (i) not obtainable, or (ii) only obtainable at additional cost, then such party shall not
be obligated to obtain a waiver; provided, however, that with respect to an inability to obtain a
waiver due to the imposition of additional cost, the party shall promptly notify the other party of
the amount of such additional cost and, if the party desiring that the other party obtain a waiver
agrees in writing to pay the additional cost of obtaining the waiver, then, upon receipt of such
payment, that party shall obtain a waiver of subrogation for the benefit of the other party, as
described in paragraph (a) above To the extent that Tenant is permitted to self insure as to its
personal property located in the Premises, Tenant will nevertheless be deemed to be insured for
such personal property for the purposes of this subparagraph 17(f).


18. Property at Tenant’s Risk. It is understood and agreed that all personal property in the
Premises, of whatever nature, whether owned by Tenant or any other person, shall be and remain at
Tenant’s sole risk and unless due to Landlord’s gross negligence or willful misconduct, Landlord
shall not assume any liability or be liable for any damage to or loss of such personal property,
arising from the bursting, overflowing, or leaking of the roof or of water or sewer pipes, or from
heating or plumbing fixtures or from the handling of electric wires or fixtures or from any other
cause whatsoever.



19. Assignment; Subletting. (a) Except as provided in this Article 19, neither Tenant, nor any of
its permitted successors or assigns, shall transfer, assign, mortgage, encumber, or, by operation
of law or otherwise, pledge, hypothecate, or assign all or any of its interest in this Lease, or
sublet or permit the Premises, or any part thereof, to be used by others, including, but not by way
of limitation, licensees of Tenant, without the prior written consent of Landlord, in each
instance, which consent Landlord may withhold in its sole and absolute discretion, for any reason
or for no reason. Any such subletting or assignment shall be referred to as a “Transfer”, and the
person to whom Tenant’s interest is transferred shall be referred to as a “Transferee”.




     (b) The prohibition against any Transfer without the prior written consent of Landlord shall
apply, without limitation, to the following circumstances, each of which shall be deemed a
Transfer: (i) if Tenant or any guarantor of this Lease is a corporation (other than a corporation,
the outstanding voting stock of which is listed on a “national securities exchange,” as defined in
the Securities Exchange Act of 1934), and if shares of such corporation are transferred by sale,
assignment, bequest, inheritance, operation of law or otherwise (including, without limitation, a
transfer to or by a receiver or trustee in federal or state bankruptcy,



11









 







insolvency or other proceeding), so as to result in or make possible a change in the present
control of such corporation; (ii) if Tenant or any guarantor of this Lease is a partnership, any
change in control or ownership of such partnership; (iii) any transfer by sale, assignment,
bequest, inheritance, operation of law or other disposition of all or substantially all of the
assets of Tenant or any guarantor which results in or makes possible a change in the present
control of the business of Tenant or any such guarantor; (iv) any other change in ownership of
Tenant, any guarantor of this Lease or the business operated by Tenant; or (v) any subletting or
assignment which occurs by operation of law, merger, consolidation, or reorganization or any
change of Tenant’s corporate or proprietary structure. In no event may Tenant assign this Lease,
or sublease the Leased Premises, if Tenant is in default under this Lease.



     (c) In
the event that Tenant desires to effect a Transfer hereunder, Tenant shall give
Landlord written notice (the “Transfer Notice”) thereof. To be
effective, the Transfer Notice
shall be accompanied by Tenant’s check, payable to the order of Landlord, or Landlord’s Agent, in
an amount equal to $500.00 to compensate Landlord for the cost of reviewing the proposed Transfer
and specify the proposed Transferee, and the proposed terms of the Transfer, and contain such
information about the proposed Transferee, its experience, its financial situation, its methods of
operation, and its impact on the Building, as a prudent businessman would require in making the
Transfer decision. Tenant specifically agrees to use diligent, good faith efforts to apprise
Landlord of any adverse or negative information in its possession concerning the proposed Transfer
and the proposed Transferee including, without limitation, information that would adversely affect
the value, marketability, financing or insurability of the Building or Avenel Business Park. The
Transfer Notice shall also contain a certificate by Tenant (or an officer or general partner of
Tenant if Tenant is a corporation or partnership) of all “Transfer Consideration” (as defined below)
or payable in connection with the proposed Transfer. Within sixty (60) days of the receipt of the
Transfer Notice Landlord shall, by written notice to Tenant, elect: (i) to permit the proposed
Transfer; (ii) to terminate this Lease; (iii) to sublet with the right to further sublet from
Tenant for the balance of the term of this Lease (a) all of the Premises, or (b) only so much of
the Lease Premises as Tenant proposed to Transfer, at the same rental as Tenant is obligated to pay
to Landlord hereunder; or (iv) to deny consent to the proposed Transfer, in which event Tenant
shall continue to occupy the Lease Premises and comply with all of the terms and conditions hereof.
In the event that Landlord fails to give Tenant written notice of its election hereunder within the
specified sixty (60) day period. Landlord shall be deemed to have denied its consent to the
proposed Transfer. Notwithstanding anything contained herein to the contrary, Landlord will not
unreasonably withhold its consent to a Transfer provided (i) such Transferee’s net worth shall be
equal to at least $16,450,000.00; (ii) such Transferee’s business in the Premises shall be
substantially comparable to Tenant’s business on the date hereof or to research and development
facilities similar to those operating in Avenel Business Park; (iii) such Transferee shall assume
in writing all of Tenant’s obligations hereunder; and (iv) Tenant continues to remain liable under
this Lease for the performance of all of the terms contained herein including but not limited to,
the payment of Base Rent and all Additional Rent due under this Lease.



     Notwithstanding any other provision hereof, Landlord shall have the absolute right to refuse
consent to any Transfer if at the time of either Tenant’s notice of the proposed Transfer or the
proposed effective date thereof, there shall exist any uncured default of Tenant or matter which
will become a default of Tenant with passage of time unless cured. Landlord’s refusal to consent
to a Transfer shall be deemed to be reasonable if the proposed Transferee is an entity that is
already an occupant of the Building or the Avenel Business Park unless Landlord (or its
affiliates) is unable to provide the amount of space required by such occupant. Further, Landlord
may deny consent to a proposed Transfer if (i) Landlord is or has been in negotiation with
Tenant’s proposed Transferee within three (3) months or less of the date of Tenant’s proposed
Transfer notice to Landlord, as evidenced by any two-way correspondence or other documents between
Landlord and the proposed Transferee; or (ii) Landlord is or has been in negotiation with Tenant’s
proposed Transferee within six (6) months or less of the date of Tenant’s proposed Transfer notice
to Landlord, as evidenced by a written proposal, letter of intent, broker’s report or other
written documentation, and the negotiation is confirmed (said confirmation to be obtained by
Landlord) by the proposed Transferee.



     (d) If Landlord consents to a Transfer, the permitted Transferee shall assume by written
instrument all of Tenant’s obligations under the Lease and such Transferee, at least ten (10) days
prior to the effective date of the permitted Transfer, shall deliver to Landlord the proposed
sublease, assignment and assumption agreement or other instrument evidencing the Transfer and the
Transferee’s undertaking of Tenant’s obligations under the Lease. All of such documents shall be
subject to Landlord’s prior written approval. In the event of a permitted Transfer, Tenant shall
continue to be liable hereunder, and shall not be released from performance hereunder. In addition
to the Rent reserved hereunder, Tenant shall pay to Landlord fifty percent (50%) of all monies,
property and other consideration of every kind whatsoever paid or payable to Tenant in
consideration of or related to such Transfer and for all property transferred to the Transferee, as
all or part of the consideration including, without limitation, fixtures,



12









 







other Leasehold Improvements, furniture, equipment and furnishings (collectively, all of the
foregoing monies, property and other consideration shall be referred to as the “Transfer
Consideration”), less the reasonable costs and expenses incurred by Tenant to effect such
Transfer, and excluding bona fide consideration paid for transfer of Tenant’s Property. Following
a permitted Transfer of this Lease, Landlord shall send the named Tenant herein, notice of default
to the named Tenant’s last known Notice address.



     (e) Any Transfer without Landlord’s consent, whether as a result of any act or omission of
Tenant, or by operation of law or otherwise, shall not be binding upon Landlord, and shall confer
no rights upon any third person. Each such unpermitted Transfer shall, without notice or grace
period of any kind, constitute a default by Tenant under this Lease. The acceptance by Landlord of
the payment of Rent following any Transfer prohibited by this Article 19 shall not be deemed to be
a consent by Landlord to any such Transfer, an acceptance of the Transferee as a tenant, a release
of Tenant from the performance of any covenants herein contained, or a waiver by Landlord of any
remedy of Landlord under this Lease, although amounts actually received shall be credited by
Landlord against Tenant’s Rend obligations. Consent by Landlord to any one Transfer shall not
constitute a waiver of the requirement for consent to any other Transfer. No reference in this
Lease to assignees, subtenants or licensees shall be deemed to be a consent by Landlord to the
occupancy of the Leased Premises by any such assignee, subtenant or licensee.



     (f) Notwithstanding anything set forth in this Article 19 to the contrary, Tenant may, without
Landlord’s consent but with written notice to Landlord given thirty (30) days’ prior to the
effective date of such assignment, assign this Lease for the use and occupation of the Premises
solely for the purpose set forth in Article 12 to (i) Tenant’s parent or subsidiary corporation or
to a corporation under common ownership with and controlled by the same persons who control Tenant,
or (ii) any party which acquires substantially all of the assets of Tenant, or (iii) to a
corporation into which Tenant merges or consolidates, provided, however, that in each such event,
(1) such assignee shall possess qualifications for conducting the business at the Premises to the
satisfaction of Landlord; (2) such assignee shall assume in writing all of Tenant’s obligations
hereunder; and (3) Tenant continues to remain liable under this Lease for the performance of all of
the terms contained herein including but not limited to, the payment of Base Rent, and all
Additional Rent due under this Lease; provided, however, that the provisions of this paragraph
shall not permit a Transfer in the event that Tenant is acquired by another corporation and becomes
a subsidiary thereof, (x) unless Tenant continues to be operated as a separately identified
company, substantially in the same manner as before such acquisition, or (y) if, after such
acquisition, or as a result thereof. Tenant’s net worth will decline by ten percent (10%) or more,
unless in either of such cases, the parent of the party acquiring Tenant agrees to guaranty
Tenant’s obligations under this Lease. The liability of any Guarantor of this Lease shall not be
affected as a result of any assignment permitted under this subparagraph (g). Notwithstanding any
provisions of clause (i) of this paragraph 19 (f) to the contrary, the provisions of clauses (i),
(ii) and (v) of paragraph (b) of this Article 19 shall apply to the transfer or sale of the stock,
partnership interests or other ownership interests of any Transferee to which Tenant would
otherwise be permitted to Transfer its interest under this paragraph (f), and no Transfer will be
permitted under this paragraph (f) without Landlord’s consent, if such Transfer would result in a
Transfer of this Lease or the ownership interests in any Transferee to an entity not affiliated
with Tenant through common ownership and control. It is the intention of the parties that the
provisions of clause (i) of this paragraph 19 (f) are included herein for the purpose of providing
Tenant with flexibility in the manner of operating its business but such provisions are not
intended to permit, and do not permit, a Transfer of this Lease to an entity outside the ownership
family to which Tenant belongs as a means of defeating the other provisions of this Article 19
which require Landlord’s consent to a Transfer.


20. Signs. No sign, advertisement or notice shall be inscribed, painted, affixed or displayed on
the windows or exterior walls of the Premises or on any public area of the Building, except the
directories and the office doors, and then only in such places, numbers, sizes, color and style as
are approved by Landlord and which confirm to all applicable laws and/or ordinances. Any and all
permitted signs shall be installed and maintained by Landlord at Tenant’s sole expense. During the
period of six months prior to the expiration of this Lease or any renewal thereof, Landlord shall
have the right to display on the exterior of the Premises a sign advertising the space as available
“For Rent”.



21. Rules and Regulations. Tenant shall at all times comply with the rules and regulations set
forth on Exhibit B attached hereto, and with any reasonable additions thereto and reasonable
modifications thereof adopted from time to time by Landlord, and each such rule or regulation shall
be deemed to be a covenant of this Lease to be performed and observed by Tenant. Landlord agrees
that it will not unreasonably discriminate in the application of its rules and regulations.




13









 







22. Parking. Landlord shall provide a minimum of three (3) parking spaces per 1,000 rentable square
feet of Premises, within reasonable walking distance to the Building. Landlord grants Tenant the
non-exclusive, unassigned right to use the parking area or areas designated by the Landlord from
time to time, free of charge. Tenant hereby agrees to comply with all traffic and parking rules and
regulations imposed by Landlord from time to time.



23. Landlord Access. Landlord shall have the right, with reasonable prior notice (which may be
oral) to Tenant (except in the event of an emergency where no notice shall be required), to enter
upon the Premises for purposes of (i) showing the Premises to prospective tenants; (ii) to Past the
Premises with “For Rent” or other offering signs, as Landlord may deem appropriate; (iii)
exhibit the same to prospective purchasers or mortgagees; and (iv) to inspect the Premises to see
that Tenant is complying with all its obligations hereunder, or to make required repairs. Landlord
shall exercise its rights of access to the Premises in such a commercially reasonable manner so as
to minimize interference with Tenant’s use and occupancy of the Premises, provided that Landlord
shall incur no additional expense thereby.



24. Subordination (a) This Lease is subject and subordinate to the lien of any ground leases and to
all mortgages, deeds of trust or deeds to secure debt which may now or hereafter affect or encumber
the Building or the real property of which the Premises form any part, and to all renewals,
modifications, consolidations, replacements or extensions thereof. This Article shall be
self-operative and no further instrument of subordination shall be required. In confirmation of any
such subordination, Tenant shall execute within five (5) days after receipt, any certificate that
Landlord may reasonably so request. No foreclosing lender nor any purchaser at foreclosure shall be
liable for and defaults (including defaults of a continuing nature) by any prior landlord, or for
the return of any security deposit; Tenant covenants and agrees to attorn to Landlord or to any
successor to Landlord’s interest in the Premises, whether by sale, foreclosure or otherwise. As of
the date hereof, there is no mortgage lien on the Building and/or Property. Notwithstanding the
foregoing to the contrary, this Lease shall not be subordinate to any future mortgage, deed of
trust or other lien on the Building and/or Property unless the party secured by any such instrument
enters into a non-disturbance agreement with Tenant on such future lender’s customary form that is
reasonably acceptable to Tenant.




     (b) Notwithstanding the foregoing, in the event any ground lessor, mortgagee or the holder of
any deed of trust or deed to secure debt shall elect to make the lien of this Lease prior to the
lien of its ground lease or mortgage, then, upon such party giving Tenant written notice to such
effect at any time prior to the commencement of foreclosure by filing a notice thereof for record
among the land records, this Lease shall be deemed to be prior in lien to the lien of such ground
lease or mortgage, whether dated prior or subsequent thereto.


25. Mortgagee Protection. Tenant agrees to give any Mortgagees and/or Trust Deed Holders, by
Registered Mail, a copy of any Notice of Default served upon Landlord, provided that prior to such
notice Tenant has been notified, in writing, (by way of Notice of Assignment of Rents and Leases, or
otherwise) of the address of such Mortgagees and/or Trust Deed Holders. Tenant further agrees that
if Landlord shall have failed to cure such default within the time provided for in this Lease, then
the Mortgagees and/or Trust Deed Holders shall have an additional thirty (30) days within which to
cure such default or if such default cannot be cured within that time, then such additional time as
may be necessary if within such thirty (30) days, any Mortgagee and/or Trust Deed Holder has
commenced and is diligently pursuing the remedies necessary to cure such default (including but not
limited to commencement of foreclosure proceedings, if necessary to effect such cure), in which
event this Lease shall not be terminated while such remedies are being so diligently pursued.
Tenant agrees that in the event of the sale of the Property, by foreclosure or deed in lieu
thereof, the purchaser at such sale shall only be responsible for the return of any security
deposit paid by Tenant to Landlord in connection with this Lease to the extent that such purchaser
actually receives such security deposit.



26. Intentionally Deleted.



27. Hold-Over. If Tenant shall not immediately surrender the Premises the day after the end of the
term hereby created, then Tenant shall, by virtue of this agreement, become, at Landlord’s option,
either (a) a tenant at sufferance, or (b) a tenant from month-to-month. In either of such events,
rent shall be payable at a monthly or daily rate, as the case may be, of one and one-half
(11/2) times the Base Rent and Additional Rental payable by Tenant immediately prior to
the expiration or termination of the term, with said tenancy to commence on the first day after the
end of the term above demised; and said tenancy shall be subject to all of the conditions and
covenants of this Lease insofar as such covenants and conditions are applicable thereto. Nothing
contained in this Lease shall be construed as a consent by Landlord to the occupancy or possession
of the Premises after the expiration of the term


14









 






of this Lease. If Landlord fails to make an election under clause (a) or (b) within ten (10) days
after the expiration or termination of the term, the hold-over tenancy shall be deemed to be a
tenancy from month-to-month. If Tenant holds over a s a month-to-month tenant, each party hereto
shall give to the other at least thirty (30) days’ written notice to quit the’ Premises (any right
to a longer notice period being hereby expressly waived), except in the event of non-payment of
rent in advance or of the other Additional Rents provided for herein when due, or of the breach of
any other covenant by the said Tenant, in which event Tenant shall not be entitled to any notice
to quit, the usual thirty (30) days’ notice to quit being expressly waived; provided, however,
that in the event Tenant shall hold over after expiration of the term hereby created, and if
Landlord shall desire to regain possession of said Premises promptly at the expiration of the term
aforesaid, then at any time prior to the date Landlord makes (or is deemed to have made) its
election under clause (b) of this Article 27, Landlord at its opinion, may re-enter and take
possession of the Premises forthwith, without process, or by any legal action or process in force
in the state in which the Premises is located; provided, however, that if Landlord has accepted
rent for any period beyond the expiration of the term and Tenant is not then in default under any
of the provisions of this Lease, Landlord shall promptly refund to Tenant an amount equal to any
excess rental received by Landlord with respect to any period after Landlord exercises its right
to re-enter the Premises under this Article 27.



28. Estoppel Certificates. Tenant agrees, at any time and from time to time, upon not less than
five (5) days’ prior written notice by Landlord, to execute, acknowledge and deliver to Landlord or
to such person(s) as may be designated by Landlord, a statement in writing (i) certifying that
Tenant is in possession of the Premises, has unconditionally accepted the same and is currently
paying the rents reserved hereunder, (ii) certifying that this Lease is unmodified and in full
force and effect (or if there have been modifications, that the Lease is in full force and effect
as modified and stating the modifications), (iii) stating the Rent Commencement Date and the dates
to which the rent and other charges hereunder have been paid by Tenant and (iv) stating whether or
not to the best knowledge of Tenant, Landlord is in default in the performance of any covenant,
agreement or condition contained in this Lease, and, if so, specifying each such default of which
notices to Landlord should be sent. If Tenant fails to execute and return any such agreement to
Landlord within such five (5) day period, then, in addition to all other rights and remedies
available to Landlord at law or in equity, Landlord shall be entitled to collect from Tenant, as
liquidated damages with respect to such default of Tenant in addition to Base Rent and other
amounts payable hereunder, as Additional Rent, an amount equal to one-half of one percent (1/2%)
of
the then monthly amount of Base Rent then payable under this Lease, for each day Tenant delays in
returning the requested agreement to Landlord. Any such statement delivered pursuant hereto may be
relied upon by any owner, prospective purchaser, mortgagee or prospective mortgagee of the Building
or of Landlord’s interest therein, or any prospective assignee of any such mortgagee.



29. Quiet Enjoyment. Landlord warrants that it has the right to make this Lease for the term
aforesaid and that it will put Tenant into complete and exclusive possession of the Premises.
Landlord covenants that if Tenant pays the rent and all other charges provided for herein, performs
all of its obligations provided for hereunder and observes all of the other provisions hereof,
Tenant shall at all times during the term hereof peaceably and quietly have, hold and enjoy the
Premises, without any interruption or disturbance from Landlord, or anyone claiming through or
under Landlord, subject to the terms hereof.



30. Intentionally Deleted.



31. Modifications Due to Financing. If, in connection with obtaining temporary or permanent
financing for the Building or the land upon which the Building is located, any such lender shall
request reasonable modifications of this Lease as a condition to such financing, Tenant agrees that
Tenant will not unreasonably withhold, delay or defer the execution of any agreement of
modification of this Lease provided such modifications do not increase the financial obligations of
Tenant hereunder or materially adversely affect the leasehold interest hereby created or Tenant’s
reasonable use and enjoyment of the Premises.



32. Attorneys. Tenant shall reimburse Landlord upon demand for any reasonable costs or expenses,
including reasonable attorney fees, incurred by Landlord in connection with the enforcement of
Tenant’s obligations hereunder or otherwise incurred by Landlord in connection with any judicial
proceedings regarding the rights and obligations of Tenant under this Lease. Any and all costs or
expenses incurred by Landlord pursuant to the provisions hereof shall be considered as Additional
Rent hereunder. Tenant acknowledges that it has engaged counsel in connection with the negotiation
of this Lease, or that Tenant has freely decided to enter into this Lease without engaging the
services of counsel.



33. Notices. All notices, rent or other payments required or desired to be given hereunder by
either party to the other shall be sent by first class mail, postage prepaid, or by a reputable
commercial messenger service, except that notices of default shall


15









 






be sent by certified mail, return receipt requested or by a receipted commercial messenger service
(such as Federal Express or Airborne Express) for delivery on the next following business day.
Notices to the respective parties, and any amounts required to be paid hereunder, shall be
addressed and sent as follows:




	 	 	 	 	 
	 
	 	 	 	 
	If to Landlord:

	 	NOTICES AND CORRESPONDENCE
	 	RENT, PAYMENTS, ETC.
	 

	 	c/o Franklin Property Management Company
	 	B.F. Saul Real Estate Investment Trust
	 

	 	8401 Connecticut Avenue
	 	c/o Franklin Property Management Company
	 

	 	Chevy Chase, Maryland 20815
	 	P.O. Box 64772
	 

	 	cc: Legal Department
	 	Baltimore, Maryland 21264-4772
	 
	 	 	 	 
	If to Tenant

	 	BBI-Biotech Research Laboratories, Inc.
	 	with a copy to:
	 

	 	c/o Boston Biomedica
	 	Boston Biomedica
	 

	 	375 West Street
	 	375 West Street
	 

	 	West Bridgewater, MA 02378
	 	West Bridgewater, MA 02378
	 

	 	Attn: Treasurer
	 	Attn: President





Either party may designate a substitute address, from time to time, by notice in writing sent in
accordance with the provisions of this Article 33.



34. Applicable Law. This Lease shall be construed under the laws of the State in which the Premises
is located.



35. No Reservation. The submission of this Lease for examination does not constitute a reservation
of or option for the Premises, and this Lease becomes effective only upon execution and delivery
thereof by Landlord. Neither party shall have any legal obligation to the other in the event that
the lease contemplated herein is not consummated for any reason. Discussions between the parties
respecting the proposed lease described herein, shall not serve as a basis for a claim against
either party or any officer, director or agent of either party.



36. Parties; Assigns and Successors. Feminine or neuter pronouns may be substituted for those of
the masculine form, and the plural may be substituted for the singular number, in any place or
places herein in which the context may require such substantive on or substitutions. The term
“Landlord” as used in this Lease, means only the owner for the time being of the Landlord’s
interest in this Lease; and, in the event of the sale, assignment or transfer by such owner of the
Landlord’s interest in this Lease, such owner shall thereupon be released and discharged of all
covenants and obligations of Landlord hereunder thereafter accruing. Except as provided in the
preceding sentence, all of the covenants, agreements, terms, conditions, provisions and
undertakings in this Lease shall inure to the benefit of, and shall extend to and be binding upon,
the parties hereto and their respective heirs, executors, legal representatives, successors and
assigns, to the same extent as if they were in every case named and expressed. If two or more
individuals, corporations, partnerships or other business associations (or any combination of two
or more thereof) shall sign this Lease as Tenant, the liability of each such individual,
corporation, partnership or other business association to pay rent and perform all other
obligations hereunder shall be deemed to be joint and several and any notice required or permitted
by the terms of this Lease may be given by or to any one thereof, and shall have the same force and
effect as if given by or to all thereof. In like manner, if the Tenant named in this Lease shall be
a partnership or other business association, the members of which are, by virtue or statute or
general law, subject to personal liability, the liability of each such member shall be joint and
several.



37. Severability. If any term, covenant or condition of this Lease or the application thereof to
any person or circumstance shall to any extent be held invalid or unenforceable, the remainder of
this Lease or the application of such term, covenant or condition to persons or circumstances other
than those as to which it is held or unenforceable, shall not be affected thereby and each term,
covenant and condition of this Lease shall be valid and enforced to the fullest extent permitted by
law.



38. Rent Tax. If applicable in the jurisdiction where the Premises are situated, Tenant shall pay
and be liable for all rental, sales and use taxes or other similar taxes, if any, levied or imposed
by any City, State, County or other governmental body having authority, such payments to be in
addition to all other payments required to be paid to Landlord by Tenant under the terms of this
Lease. Any such payments shall be paid concurrently with the payment of the rent upon which the tax
is based as set forth above.




16









 







39. Acts of God. Landlord and/or Tenant shall be excused for the period of any delay and shall not
be deemed in default with respect to the performance of any of the non-monetary terms, covenants
and conditions of this Lease when prevented from so doing by cause or causes beyond the Landlord’s
and/or Tenant’s reasonable control, which shall include, without limitation, all labor disputes,
fire or other casualty, inability to obtain any material, services, acts of God, or any other
cause, whether similar or dissimilar to the foregoing, not within the reasonable control of the
Landlord and/or Tenant. Any party desiring to claim a delay as a result of the occurrence of any
of the above described events shall notify the other party within five (5) business days after the
date the party first knows of such event. Lack of funds shall not, in any event, be considered an
event of force majeure for any purposes under this Lease.



40. Landlord’s Liability. Tenant agrees that Landlord shall have no personal liability with
respect to any of the provisions of this Lease and Tenant shall look solely to the estate and
property of Landlord in the land and buildings comprising the Property of which the Premises forms
a part, Landlord’s interest in rents related to the Building, Landlord’s interest in insurance and
condemnation proceeds related to the Building, Landlord’s net interest in sale and refinancing
proceeds related to the Building received, and Landlord’s interest in operating and reserve
accounts related to the Building for the satisfaction of Tenant’s remedies, including, without
limitation, the collection of any judgement or the enforcement of any other judicial process
requiring the payment or expenditure of money by Landlord, subject, however, to the prior rights
of any holder of any Mortgage covering all or part of the Property, and no other assets of
Landlord shall be subject to levy, execution or other judicial process for the satisfaction of
Tenant’s claim and, in the event Tenant obtains a judgement against Landlord, the judgement docket
shall be so noted. This Section shall inure to the benefit of Landlord’s successors and assigns
and their respective principals. The name B.F. Saul Real Estate Investment Trust (the Trust”) is
the designation of the trustees for the time being under a Declaration of Trust dated July
31, 1962, as amended and restated from time to time, a copy of which, together with all amendments
thereto, is filed with the Maryland State Department of Assessments and Taxation, and in
accordance with such Declaration of Trust, notice is hereby given (i) that all persons dealing
with the Trust must look solely to the trust property for the enforcement of any claims against
the Trust, (ii) that any agreement, obligation or liability made, entered into or incurred by or
on behalf of B.F. Saul Real Estate Investment Trust binds only its trust property, and (iii) that
no shareholder, trustee, officer or agent of the Trust assumes or shall be held to any liability
therefor.



41. Remedies Cumulative; No Waiver. All rights and remedies given herein and/or by law or in
equity to Landlord are separate, distinct and cumulative, and no one of them, whether exercised by
Landlord or not, shall be deemed to be in exclusion of any of the others. No failure of Landlord
to exercise any power given Landlord hereunder, or to insist upon strict compliance by Tenant with
his obligations hereunder, and no custom or practice of the parties at variance with the terms
hereof shall constitute a waiver of Landlord’s right to demand exact compliance with the terms
hereof.



42. Modification. This writing is intended by the parties as the final expression of their
agreement and as a complete and exclusive statement of the terms thereof, all negotiations,
considerations and representations between the parties having been incorporated herein. No course
of prior dealings between the parties or their affiliates shall be relevant or admissible to
supplement, explain or vary any of the terms of this Lease. Acceptance of, or acquiescence in, a
course of performance rendered under this or any prior agreement between the parties or their
affiliates shall not be relevant or admissible to determine the meaning of any of the terms of
this Lease. No representations, understandings or agreements have been made or relied upon in the
making of this Lease other than those specifically set forth herein. This Lease can only be
modified by a written agreement signed by all of the parties hereto or their duly authorized
agents.



43. Waivers. Landlord and Tenant each hereby waives all right to trial by jury in any claim,
action, proceeding or counterclaim by either party against the other on any matters arising out of
or in any way connected with this Lease, the relationship of Landlord and Tenant and/or Tenant’s
use or occupancy of the Premises. Tenant hereby expressly waives (to the extent legally
permissible) for itself and all persons claiming by, through or under it, any right of redemption
or right for the restoration of the operation of this Lease under any present or future law in
case Tenant shall be dispossessed for any cause, or in case Landlord shall obtain possession of
the Premises as provided in this Lease. Tenant understands that the Premises are leased
exclusively for business, commercial and mercantile purposes and therefore shall not be redeemable
under any provision of law.



44. Interpretation. Captions and headings are for convenience and reference only. Whenever in this
Lease any printed portion, or any part thereof, has been stricken out, whether or not any
replacement provision has been added, this Lease shall be read and construed as if the material so
stricken out were never included herein, and no implication shall be drawn from the text


17









 






of the material so stricken out which would be inconsistent in any way with the construction or
interpretation which would be appropriate if such material had never been contained herein. The
Exhibits referred to in this Lease and attached hereto are a substantive part of this Lease and are
incorporated herein by reference. In any legal proceeding respecting this Lease, this Lease will be
construed with equal weight for the rights of both parties, the terms hereof having been determined
by free and fair negotiation, with due consideration for the rights and requirements of both
parties. Both parties agree that they have had equal input into the wording and phraseology of the
provisions of this Lease, and that, therefore, no provision will be construed as drafted by one
party or the other, without respect to whose draft of this Lease the wording or phraseology arises.
If any of the typewritten portions of this Lease conflict with any of the printed provisions of
this Lease, the provisions set forth in the typewritten portions shall control; provided, however,
that to the extent the printed portions of this Lease may be read in a manner which will not
conflict with the provisions of the typewritten portions, then such interpretation shall be deemed
to be the correct interpretation of the provisions of this Lease.



45. Financial Statements. Tenant, upon Lease execution, and thereafter upon written request by
Landlord, will provide Landlord with a copy of its current financial statements consisting of a
balance sheet, an earnings statement, statement of changes in financial position, statement of
changes in tenant’s equity, and related footnotes, prepared in accordance with generally accepted
accounting principles. Such financial statements must be either certified by a CPA or sworn to as
to their accuracy by Tenant’s most senior official and its chief financial officer. The financial
statements provided must be as of a date not more than 12 months prior to the date of request.
Landlord shall retain such statements in confidence, but may provide copies to lenders and
potential lenders. Notwithstanding the foregoing to the contrary, so long as Tenant is a
wholly-owned subsidiary of the Guarantor herein, Tenant shall not be required to provide financial
statements to Landlord.



46. Special Stipulations. The terms, covenants and conditions set forth in any Articles of this
Lease numbered higher than this Article 46 (“Special Stipulations”) are intended to supplement and,
in certain events, modify or vary, the other provisions set forth in the foregoing provisions of
this Lease. If any of the Special Stipulations conflict with any of the foregoing provisions of
this Lease, the provisions set forth in the Special Stipulations shall control; provided, however,
that to the extent the preceding portions of this Lease may be read in a manner which will not
conflict with the provisions of the Special Stipulations, then such interpretation shall be deemed
to be the correct interpretation of the provisions of this Lease and the Special Stipulations.



47. Landlord’s Work. (a) Landlord shall construct a new building in which the Premises will be
located containing approximately 46,335 rentable square feet. The base building work to be
performed by Landlord and the specifications for such work are described on Exhibit E.




     (b) (i) Tenant shall, within fifteen (15) days from the date hereof, provide Landlord with
schematic plans and specifications (the “Plans”) showing the work which Tenant desires Landlord
to perform in the Premises which will include improvements required to make the Premises suitable
for use by Tenant in Tenant’s business (the “Interior Improvements”). Within fifteen (15) days
after Tenant submits plans and specifications to Landlord, Landlord shall advise Tenant that
Landlord has either (a) approved the Plans or (b) disapproved the Plans, in which event Landlord
shall specify in writing in what respects the Plans are not acceptable to Landlord and what
revisions to the Plans will be required in order to make the Plans acceptable to Landlord, in
which event Tenant shall, within seven (7) days, revise the Plans in order to accommodate the
revisions required by Landlord, if Landlord does not approve or disapprove the Plans submitted to
it by Tenant within fifteen (15) days after the Plans have been received by Landlord, the Plans
shall be deemed to be approved by Landlord, and the Premises shall be constructed in accordance
with the Plans submitted by Tenant. Landlord shall notify Tenant of those initial Tenant
improvements of which the Landlord will require the Tenant to remove from the Premises at the
expiration or earlier termination of this Lease, at Tenant’s sole cost and expense. Within thirty
(30) days after Landlord’s approval of the Plans, Landlord shall have prepared construction
drawings and specifications, consistent with the approved Plans, and sufficient for Landlord to
bid out and construct all improvements desired by Tenant in the Premises (the “Construction
Drawings”). The Construction Drawings for Landlord’s work shall be provided to Tenant for review,
but shall not be subject to Tenant’s approval unless and to the extent the Construction Drawings
are materially inconsistent with the Plans, in which event Tenant’s consent, which shall not be
unreasonably withheld and which shall be deemed given if Tenant does not object within five (5)
days after receipt of the Construction Drawings, shall be required. If Tenant objects to the
Construction Drawings prepared by Landlord, Tenant shall specify in writing in what respects the
Construction Drawings are not acceptable and what revisions will be required in order to make the
Construction Drawings acceptable to Tenant.



18









 





     (ii) With respect to the cost of performing the work required by this Article, for
individual components of the work for any specific trades which are in excess of $25,000.00,
Landlord shall obtain, or cause its general contractor to obtain, at least three (3) bids.



     (iii) Landlord shall construct the Interior Improvements in accordance with the Plans
approved by (or deemed to be approved by) Landlord and Construction Drawings in accordance with
this section and in good and workmanlike manner. Tenant agrees to designate two persons who are
authorized to originate and/or approve change orders and additions associated with the Interior
improvements to the Premises. These designees are: Paul DeRito and Mark Manak. Landlord shall
(subject to delays resulting from the occurrence of events of force majeure) diligently pursue
the construction of the Premises so that the Premises will be Substantially Complete (as
hereinafter defined) and ready for occupancy within seven (7) months of the date Landlord
obtains a building permit for the base building improvements for the Building; provided,
however, that if circumstances beyond Landlord’s reasonable control (including, without
limitation, delays caused by Tenant, force majeure or Landlord’s inability to get appropriate
governmental permits required for the Interior Improvements) prevent Landlord from completing
such work by such date, then the period for Landlord to perform such work shall be extended by
an amount of time by which Landlord was unable to perform it work as a result of such delay.



     (iv) Landlord shall pay all costs and expenses incurred in constructing the Interior
Improvements in accordance with the approved Construction Drawings to the extent that such
costs and expenses do not exceed Twenty-four and 00/100 Dollars ($24.00) per rentable square
foot of Premises (“Landlord’s Contribution”). If bids or estimates received by Landlord for the
completion of the work described in the Plans and the Construction Drawings indicate that the
cost of performing such work will exceed Landlord’s Contribution, Landlord shall promptly
advise Tenant of Landlord’s estimate of the amount by which the cost of the Interior
Improvements will exceed Landlord’s Contribution, in which event Tenant shall either (i) within
five (5) days after receipt of Landlord’s notice respecting the cost of the Interior
Improvements, revise or amend the approved Plans and the Construction Drawings in order to
reduce the cost of constructing the Premises to an amount equal to or less than Landlord’s
Contribution, or (ii) deposit with Landlord the amount by which the cost of the Interior
Improvements, as estimated by Landlord, exceeds Landlord’s Contribution. If Tenant fails to
revise or amend the Plans and the Construction Drawings, as aforesaid, Tenant shall be deemed
to have exercised the option set forth in clause (ii) above. The costs of the Interior Work
will include all architectural or engineering design costs, the costs of obtaining permits and
approvals for the Interior Improvements, plan review and similar charges, a general conditions
fee of not more than nine percent (9%), a overhead fee of not more that five percent (5%) and a
construction supervision fee of not more that five percent (5%).



     (c) The term “Substantially Complete” as used herein is defined as the date upon which
Landlord notifies Tenant that construction of the Premises is substantially completed in
accordance with Construction Drawings as determined by Landlord’s architect, except for
“punch-list” items which will not materially interfere with Tenant’s intended use of the
Premises. Prior to Tenant taking occupancy of the Premises, or performing any construction or
other work in the Premises, or moving any materials, furniture and/or equipment into the
Premises, Landlord and Tenant shall, together, inspect the Premises for any minor punch-list
items, and Landlord covenants that it will within sixty (60) days of the date of such
inspection, repair or replace any such punch-list items, provided, however, that if such
punch-list items cannot, with due diligence be cured within such sixty (60) day period, if,
within such 60-day period, Landlord commences and thereafter diligently pursues the cure of any
such punch-list item, then Landlord shall be granted an additional reasonable period of time to
effect a cure. Tenant shall have the benefit of any warranties provided to Landlord with
respect to the work set forth herein. Landlord shall warrant all Landlord’s Work as provided
herein for a period of thirty (30) days from the date of delivery of the Premises to Tenant,
and shall warrant any latent defects in Landlord’s Work for a period of one (1) year from the
date of delivery of the Premises to Tenant. Landlord agrees that all the obligations of
Landlord hereunder shall be completed so as not to interfere with Tenant in obtaining its
occupancy permits.


48. Right of First Offer. Provided (i) Tenant is not then in default (beyond any applicable cure
period) in any of its obligations under this Lease, and (ii) additional space in the Building
becomes available (the “Option Space”) and Landlord desires to lease the Option Space to any
party other than the party then occupying the Option Space, Landlord agrees that, during the term
of this Lease, including any Option Term, Tenant shall have the one time right, after the
expiration or termination of the initial leases of other premises in the Building (including any
renewals or extensions of same), of first offer to enter into a lease of such space as the space
becomes available in accordance with the terms and conditions set forth in this Article 48, as
follows:





19









 









	(a)	 	Landlord shall, prior to entering into a lease for the Option Space, send to Tenant a
notice of the availability of such space and the terms and conditions under which Landlord
proposes to lease the Option Space to Tenant as set forth below (the
“Offer Notice”).
	 
	(b)	 	Within ten (10) business days after Tenants receipt of the Offer Notice, Tenant shall notify
Landlord that Tenant either (i) agrees to lease the Option Space under the terms described in the
Offer Notice, or (ii) does not desire to lease the Option Space under the terms described in the
Offer Notice. A failure by Tenant to timely elect the option described in clauses (i) or (ii) above
shall be deemed a to be a waiver by Tenant of any further right to lease the Option Space under
this Article 48.
	 
	(c)	 	If Tenant exercises its option to lease the Option Space
under this Article 48, then Tenant
shall execute a lease amendment embodying the terms set forth in the Offer Notice, within ten
(10) business days after Landlord submits any such lease amendment to Tenant. Said lease
amendment shall provide that the following terms and conditions shall apply to the Option
Space:






(i) Tenant agrees to accept the Option Space “as is” in its then existing condition
and Landlord shall have no construction obligations with respect thereto, unless an
allowance for renovation of the Option Space was specified in the Offer Notice, in
which event such provisions respecting such allowance shall be included in the lease
amendment; and




(ii) The Rent for the Option Space shall be equal to the greater of (1) the then
escalated Rent (on a per square foot basis) including a proportionate increase in
Additional Rent or (ii) the then current Prevailing Market Rent (as defined in Article
49).




	(d)	 	Landlord may, at its option, in lieu of a narrative description of the terms to be described
in the Offer Notice, submit to Tenant a lease amendment document setting forth the terms of a
proposed lease amendment, in which event Tenant’s exercise of its option to lease the Option
Space shall be made by Tenant’s execution of such lease amendment document and its return to
Landlord within the applicable time periods set forth in paragraph (b) or (c) of this Article
48. If Landlord does not submit a lease amendment document to Tenant at the time the Offer
Notice or a revised Offer Notice is given, and Tenant exercises its option to lease the Option
Space under such terms, then Tenant shall execute a lease embodying the terms set forth in the
Offer Notice within ten (10) days after Landlord submits any such lease to Tenant, as provided
in paragraph (c) above.
	 
	(e)	 	Tenant shall have no further right to lease the Option Space under this Article 48 after
Landlord enters into a lease of the Option Space with another tenant in accordance with this
Article 48.
	 
	(f)	 	Tenant’s right to lease the Option Space shall be conditioned upon Tenant’s full and complete
compliance with all of the terms and conditions of the Lease prior to the date of any Offer
Notice or a revised Offer Notice, and Tenant’s option to lease the Option Space shall
terminate when the term of this Lease expires or terminates.
	 
	(g)	 	Time shall be of the essence with respect to Tenant’s right of first offer under this Article 48.
	 
	(h)	 	Regardless of any election of Tenant to lease the Option Space, this Lease shall
nonetheless remain in full force and effect until the expiration date provided herein.




49. Option to Renew. Tenant shall have the option to renew the term of the Lease for two (2)
additional periods of five (5) years each (the “Option Term”) following the expiration of the
initial Lease term, provided that this Lease is in full force and effect’. the original Tenant
named herein shall be in possession and occupying the Premises, and Tenant shall not be in default
in the performance or observance of any of the terms, conditions, provisions and/or covenants of
this Lease. All such rights of a renewal shall be exercised by delivery to Landlord of written
notice of Tenant’s intention to renew the term at least nine (9) months but not more than twelve
(12) months prior to the expiration of the then applicable Lease term. The Option Terms shall be
on the same terms, covenants and conditions as the initial Lease term except Base Rent for the
first Lease Year of each Option Term shall be the greater of (i) one hundred three percent (103%)
of the previous year’s Base Rent including Additional Rent or (ii) one hundred


20









 






percent (100%) of the then Prevailing Market Rent (as hereinafter defined) of comparable space
within the Gaithersburg market area, including current operating costs and concessions, which Rent
shall be established as follows:





(a) Within fifteen (15) business days after receipt of Tenant’s notice exercising its option
to extend the term of this Lease, Landlord shall notify Tenant of Landlord’s estimate of the
Prevailing Market Rent. If Tenant disagrees with Landlord’s estimate of the Prevailing Market
Rent, Tenant shall notify Landlord that it has elected to submit the determination of
Landlord’s estimate of the Prevailing Market Rent to arbitration, in which event the
provisions of subparagraph (b) of this Article 49 shall govern for the selection of
arbitrators and the establishment of the Prevailing Market Rent payable for the year of the
then applicable Option Term; provided, however, that if Tenant does not elect to submit the
determination of Prevailing Market Rent to arbitration during such fifteen (15) day period,
then the Landlord’s estimate of Prevailing Market Rent shall be deemed to be agreed to by
Tenant, and, if the same is greater than 103% of the previous year’s Base Rent and Additional
Rent, then Landlord’s estimate of the Prevailing Market Rent shall be the Base Rent payable
by Tenant to Landlord during the first year of the then applicable Option Term.




(b) (i) Definition: As used herein, the term “Prevailing Market Rent” means the most probable
rent (as determined pursuant to the appraisal procedure hereinafter set forth) at which the
Premises (and any Additional Premises) would be leased in a comparable and open market, under
all conditions requisite to a fair lease, the Landlord and Tenant each acting prudently,
knowledgeable, and assuming the rent is not affected by undue stimulus. Implicit in this
definition is the consummation of the Lease beginning on the commencement date of the Option
Term under conditions whereby:




1. Landlord and Tenant are typically motivated (i.e., neither party is compelled to enter
into a lease and both parties are willing to enter into a lease).




2. Both parties are well informed or well advised, and each acting in what it considers its
own best interest.




3. A reasonable time is allowed for exposure in the open market.




4. The Prevailing Market Rent shall be computed as an amount equal to the then prevailing
market rental rate of the Premises, as if vacant with building standard improvements, and
taking into account the annual adjustments of the Initial Base Rent, Tenant’s obligation to
pay Tenants pro-rata share of Annual Operating Expenses and all existing market factors.




5. All of the terms, covenants and conditions of the Lease (except terms respecting the
amount of Base Rent) remain in effect throughout the applicable Option Term.




(ii) In the event of a dispute as to determination of Prevailing Market Rent referred to in
this Article, such dispute shall be in accordance with the following:




     If Landlord and Tenant fail to agree upon the Prevailing Market Rent as referred to in
this Article, within the time periods provided for herein, then Landlord and Tenant each
shall give notice to the other setting both the name and address of a licensed real estate
broker or appraiser (hereinafter “appraiser”) who shall be a M.A.I. Real Estate professional
with substantial experience in commercial real estate appraisal designated by it to make the
determinations hereafter required. Each appraiser shall be instructed to calculate the
Prevailing Market Rent as provided in each of the foregoing sections which is the subject of
the dispute and is in accordance with the criteria referenced therein. If either party shall
fail to give notice of such designations within ten (10) days after failing to agree between
themselves, then the appraisal made by the appraiser so designated shall be the Appraisal
Prevailing Market Rent. If two appraisers have been designated, such two appraisers shall
consult with each other and, within thirty (30) days thereafter, issue their determinations
of Appraisal Prevailing Market Rent in writing, and give notice thereof to each other and to
Landlord and Tenant. If such two appraisers shall concur as to the determination of the
Prevailing Market Rent and submit their decision in writing to Landlord and Tenant, such
concurrence shall be final and binding upon Landlord and Tenant. If the two determinations
of Prevailing Market Rent shall be within five percent (5%) (measured from the higher
appraisal) of each other, the Prevailing Market Rent shall be deemed to be the average of
the two appraisers’ determinations. If such two appraisers’ determinations shall not so
concur or coincide, then such two appraisers shall immediately (i) designate a third




21











 






appraiser, (ii) prepare detailed written appraisals, and (iii) submit copies of such
appraisal to Landlord, Tenant and such third appraiser. If the two appraisers shall fail to
agree upon the designation of such third appraiser within eight (8) days of the date on
which the last determination was rendered, then either party may apply to the American
Arbitration Association or any successor thereto having jurisdiction, for the designation of
such third appraiser. The third appraiser shall be licensed real estate appraisers who shall
have had at least fifteen (15) years continuous experience in the business of appraising
real estate in the Montgomery County area. The third appraiser shall conduct such hearings
and investigations as he may deem appropriate and shall, within twenty (20) days after the
date of designation of the third appraiser, choose the determination of the two appraisers
originally selected by the parties which is the nearest to the determination such third
appraiser would have made acting alone and applying the standards set forth therefor in this
Lease, and that choice by the third appraiser shall be binding upon Landlord and Tenant. Each
party shall pay its own counsel fees and expenses, if any, in connection with any
arbitration under this Article, including the expenses and fees of any appraiser selected by
it in accordance with the provisions of this Article, and the parties shall share equally
all other expenses and fees of any such arbitration, including the expenses of the third
appraiser. The determination rendered in accordance with the provisions of this Article
shall be final and binding in fixing the Prevailing Market Rent. Notwithstanding the
foregoing, in no event shall the Base Rent for the first Lease Year of the applicable Option
Term be less than the then Base Rent of the last Lease Year of the previous term.




(c) Commencing on the first day of the second Lease Year of the applicable Option Term and on
the first day of every Lease Year thereafter during the applicable Option Term, the annual
Base Rent shall be increased by one hundred three percent (103%) of the amount of the annual
Base Rent which was in effect during the Lease Year immediately preceding the Lease Year for
which the adjustment is being made.


50. Broker. Landlord shall pay the commission due in connection with this Lease to Trammell Crow
Real Estate Services, Inc. (“Broker”). Notwithstanding the foregoing, Broker has acted as agent for Tenant and
represented Tenant’s interests and not
Landlord’s interests, and Broker is not, and shall not be deemed to be, the agent of Landlord for
any purpose whatsoever. Except
in regard to Broker, Landlord and Tenant represent to each other that they have not dealt with any
broker(s) or finder(s) concerning
this Lease. Landlord and Tenant mutually agree to defend and hold each other harmless against any
claims of any person or entity
involving a breach of the representation contained in this Article 50. In the event of such a claim
by any person or entity, the party
against whom the claim is made or the litigation is commenced shall give reasonable notice to the
other party with opportunity to
such other party to defend against any claim for which indemnity will be sought under this Article
50.



51. Building Sign.  Tenant shall be permitted to install an exterior sign on the Building with
Landlord’s prior written approval,
which shall not be unreasonably withheld, provided such sign shall conform to (i) any and all
applicable laws, ordinances or
regulations of any governmental authorities, and (ii) any insurance requirements. Any such approved
signs shall be maintained
by Tenant in good condition and repair and in accordance with the standards of the Building, and
Landlord shall have the right to
require Tenant to repair or replace any such signs if the same is damaged or in disrepair. Tenant
shall obtain and pay for all permits
and licenses required in connection with any such approved sign(s), and shall be responsible for
the proper installation thereof.



52. Outside Storage Area and Flammable Storage Units Area.  Landlord shall allow Tenant to allocate,
from Tenant’s
parking allotment pursuant to Article 22, (i) a portion of the parking area equal a maximum of five
hundred (500) square feet, to
install its emergency generator and chemical storage tanks (“Outside Storage Area”) used in the
operation of Tenant’s business
at the Premises and (ii) a portion of the parking area to install two (2) flammable storage units
in accordance with Exhibit F, used
in the operation of Tenant’s business at the Premises (“Flammable Storage Units Area”). The
Outside Storage Area and
Flammable Storage Units Area shall be located immediately adjacent to the rear of the Building, as
reasonably approved by
Landlord in writing. Tenant shall install, at its sole cost and expense in accordance with
applicable laws, insurance requirements
and plans approved by Landlord, bollards or fencing, with locks to secure same, around the Outside
Storage Area and Flammable
Storage Units Area. Tenant shall maintain the Outside Storage Area and Flammable Storage Units
Area and shall be responsible
for all governmental permits and approvals related thereto, its sole cost and expense and shall
endorse its insurance policies to
include all matters arising out of such areas.



53. Environmental Matters. (a) Tenant represents that the list attached hereto as Exhibit F, is a
complete and accurate list
of chemicals and hazardous materials, including approximate quantities, to be used and stored in or
about the Premises. The
amounts of chemicals and hazardous materials will be limited to quantities necessary for the
Tenant’s day to day operations.




22









 







Landlord is relying on the list in Exhibit F in not requiring Gradual Pollution and/or
Contamination Liability Insurance. Tenant shall provide Landlord with an annual statement
certified by an officer of Tenant that the chemicals, hazardous materials, procedures and
equipment (including but not limited to certification of air handling units [bio-safety cabinets
with HEPA filtered air pursuant to Exhibit F]), listed on Exhibit F remain substantially the same
with respect to risk, quantities and characteristics. In addition, should Tenant’s operation
change such that any additional chemicals and hazardous materials are utilized or quantities of
such items required for Tenant’s operation will be significantly larger than those stipulated in
Exhibit F, Tenant shall provide Landlord written notice prior to any such change, and Landlord
shall have the right to require Tenant to obtain and maintain Gradual Pollution and/or
Contamination Insurance. Tenant shall provide Landlord with all current, third party contracts for
handling, use, storage and disposal of all chemicals and hazardous materials used and/or stored by
Tenant on the Property, and make available to Landlord any manifests, records or other
documentation related thereto for Landlord’s inspection. Tenant shall allow Landlord or its
agents, prospective lenders, insurance agents and environmental auditors or consultants, to
inspect the Premises or any other area utilized by Tenant for the use and/or storage of chemicals
and hazardous materials on the Property, or records and procedures related thereto, upon
reasonable prior notice to Tenant.




     (b) With at least two (2) business days’ prior oral or written notice (except in the event of
an emergency where no notice shall be required), Landlord’s environmental consultant may inspect the Premises or any other
area on Landlord’s Property utilized by Tenant, on an annual basis (unless Tenant is not in compliance with this Lease, then on a
quarterly basis until Tenant is in compliance herewith) and within ninety (90) days of the expiration or earlier termination of
this Lease, and the Tenant’s records and procedures regarding the Tenant’s storage, use, and disposal of chemicals and hazardous
materials within the Premises. If Landlord’s environmental consultant finds Tenant to be in non-compliance with the
requirements hereof in a manner which, in the consultant’s reasonable opinion, may adversely affect the Property, Tenant shall reimburse
Landlord, as Additional Rent pursuant to the provisions of this Lease, for the cost of that inspection and for any subsequent
inspection until Tenant is in compliance as determined by the environmental consultant. Further, in the event that the Landlord’s
environmental consultant finds that the Tenant is not in compliance with any applicable law, regulation, or codes regarding the
storage, use or disposal of chemicals or hazardous materials, such non-compliance shall constitute a default under this Lease.



     (c) Tenant shall defend, indemnify, and hold Landlord and Landlord’s agents, officers,
directors, employees, and contractors harmless against and from any and all injuries, costs, expenses, liabilities,
losses, damages, injunctions, suits, actions, fines, penalties, and demands of any kind or nature (including reasonable attorneys fees)
occasioned by or arising out of or relating to any environmental pollution, damage, condition or problem arising from the presence of any
hazardous substances, asbestos or other toxic waste as defined in any federal, state, or municipal governmental or
quasi-governmental laws, rules, regulations, or ordinances in or about the Premises, the Building or the Property in violation of law that
are existing in the Premises, the Building or the Property not caused
by Landlord’s negligent act or omission. The indemnification herein
shall survive the expiration or earlier termination of this Lease.


54. License for Early Partial Occupancy. Tenant desires to occupy approximately ten thousand
(10,000) square feet of the Premises, as shown on Exhibit A-1 (“Early Occupancy Space”), on or
about August 1, 1997, for the purpose of controlled storage of biomedical specimens relating to
Tenant’s use. Landlord hereby grants Tenant the right to enter upon and occupy the Premises for
said purpose upon the following conditions:




     a. Tenant shall, at Tenant’s sole cost and expense, apply for and obtain all governmental
permits and approvals necessary to occupy the Premises for the use set forth herein.



     b. Landlord shall notify Tenant within five (5) days of delivery of the Early Occupancy Space
that the same is ready for Tenant’s occupancy. The term of the license granted herein shall commence on the date
Landlord delivers the Early Occupancy Space to Tenant and shall expire on the date the Premises are delivered to Tenant
in accordance with Article 47 of the Lease.



     c. At least one (1) day prior to the date Tenant takes possession of the Early Occupancy
Space, Tenant shall pay Landlord Rent in an amount equal to $361.11 per diem (1/30th of the monthly amount), payable
in equal monthly installments of $10,833.33, in advance, on the first day of each calendar month included in the term of this
license. For any portion of a calendar month included at the beginning of the term of this license, Tenant shall pay the per diem
installment as set forth above for such portion, payable on the first day of such portion. If this license expires prior to the end
of a full calendar month, Landlord shall apply



23









 





any overpayment of Rent payable hereunder, to the Base Rent then due under the Lease. Tenant’s
obligation to pay all Operating Costs for the operation of the Building as a result of Tenant’s
use of the Premises as provided herein, and 21.58% of Real Estate Taxes based on the Early
Occupancy Space pursuant to Article 5 of the Lease shall commence on the date Tenant takes
possession of the Early Occupancy Space, however, such costs shall only consist of actual
incremental Operating Costs in excess of what Landlord would have incurred but for Tenant’s
occupancy.



     d. Tenant shall defend, indemnify and save Landlord harmless from and against all claims,
liabilities, suits, fines, penalties, damages, losses, fees, costs and expenses, including attorney fees, which may be
imposed upon, incurred by, or served against Landlord by reason of:



          (i) any work or thing done by or on behalf of the Tenant, or any of its agents, contractors,
subcontractors, servants, employees, licensees, or invitees, in or about the Premises or any parts
thereof;




          (ii) any use, occupation, condition, or operation by the Tenant, or any of its agents,
contractors, subcontractors, servants, employees, licensees, or invitees, in or about the Premises
or any part thereof, or any passageway or space adjacent thereto, or elsewhere in the Premises or
the Building;




          (iii) any act or omission on the part of the Tenant, or any of its agents, contractors,
subcontractors, servants, employees, licensees, or invitees;




          (iv) any occurrence, accident, injury (including death), or damage, directly or indirectly
caused by the Tenant or any of its agents, contractors, subcontractors, servants, employees,
licensees, or invitees to any person or property carried in, or about the Premises or any part
thereof, or in or about the Building; and




          (v) any lien arising as a result of any of Tenant’s actions or omissions with respect to its
activities on or with respect to the Premises.




     This indemnity shall extend to any include the cost and expenses, including reasonable
attorney fees, incurred by Landlord in enforcing this indemnity.



     e. Prior to Tenant’s entry into the Premises, Tenant shall deliver to Landlord evidence that
Tenant has obtained public liability insurance, with an insurer and having limits of coverage as defined in the Lease,
covering Tenant’s activities in the Premises and the Building, with contractual indemnity coverage with respect to Tenant’s indemnity
obligations under this Article 54, and which names Landlord as an additional insured with respect to claims arising out of Tenant’s
activities and occupancy in the Premises and the Building pursuant to this Article.



     f. Tenant acknowledges that any of Tenant’s equipment, or other materials stored in the
Premises or improvements made to the Premises by Tenant, are at Tenant’s risk and Tenant hereby waives any claim for
improvements, damages, expenses or costs incurred in respect of Tenant’s activities in or use of the Premises during the this
early partial occupancy period. The Tenant shall not make any alterations to the Premises unless such alterations have been
approved by Landlord in writing. Tenant shall repair any damage to the Premises or the Building resulting from activities in or use
of the Premises and the Building conducted by or or behalf of Tenant with respect to this Article.



     g. Tenant’s obligations under this Article 54 shall survive the termination of this
license.



     h. If the license herein is terminated, Tenant hereby agrees to vacate and quit the
Premises, and return the same in good condition, reasonable wear and tear excepted, and the Tenant further agrees to cause all
of its agents, contractors, subcontractors, servants, employees, licensees, and invitees to vacate
and quit the Premises upon termination of this license.



     i. Tenant shall not interfere with Landlord’s Work and if Landlord or its general contractor
determine in their reasonable discretion that Tenant, as a result of its activities or occupancy of the Premises
pursuant to this Article, has delayed or interfered with Landlord’s Work, then (i) Landlord may
require that Tenant immediately cease any activity or occupancy of the



24









 





Premises causing, or which may cause, any delay or interference with Landlord’s Work; and/or
(ii) in such event, the Rent Commencement Date pursuant to Article 2 of this Lease shall be
accelerated for each day Landlord’s Work is delayed.



     j. Notwithstanding the foregoing to the contrary, this license may be revoked by Landlord
at any time by written notice to Tenant if Tenant fails to comply in all respects with the terms,
covenants and conditions set forth herein, as determined by Landlord, in Landlord’s discretion.



55. Delays in Completion of Landlord’s Work. Landlord shall diligently pursue the construction of
the Landlord Work described in Article 47 so that such work will be Substantially Complete (as
defined in Article 47) and the Premises will be ready for occupancy within seven (7) months of
the date Landlord obtains a building permit for the base building improvements for the Building. If
Landlord fails to Substantially Complete the work described in
Article 47 with in seven (7) months of
the date Landlord obtains a building permit for the base building improvements for the Building due
to reasons within Landlord’s reasonable control, then, until such work is Substantially Complete,
Landlord shall be liable to Tenant for the sum of Three Hundred Dollars ($300.00) for each day
beyond such seven (7) month period until the work is Substantially Complete. The period of time for
Landlord’s performance of the work described in Article 47 shall be extended by a period of time
equal to the period of any delays caused by circumstances beyond Landlord’s reasonable control
(including, without limitation, delays caused by Tenant in approving the Plans under Article 47 or
other delays caused by Tenant’s actions or failure to act within any period provided for in this
Lease, force majeure or Landlord’s inability to get appropriate governmental permits required for
the Interior Improvements) which prevent Landlord from completing such work.



25









 





     IN WITNESS WHEREOF, the parties hereto have executed this Lease under seal on the day and
year first above written.



	 	 	 	 	 	 
	ATTEST/WITNESS: 	 	 LANDLORD:


B.F. SAUL REAL ESTATE INVESTMENT TRUST

 	 
	/s/ Signature 	 	By:  	/s/
B.F. Saul
 	(SEAL) 
	 	 	 	Name (Print):  B.F. Saul	 
	 	 	 	Title:  	 	 
	 
	ATTEST: 	 	TENANT:

BBI-BIOTECH RESEARCH LABORATORIES, INC., a Massachusetts
corporation 	 
	 
	/s/
Richard T. Schumacher 	 	By:  	/s/ Kevin W. Quinlan 	(SEAL) 
	 	 	 	Name (Print): 	Kevin W. Quinlan 	 
	(corporate seal) 	 	 	Title: 	Senior Vice President 	 
	 
	 	 	Tenant’s Tax I.D. Number: 04-3152- 484 	 



26









 







SECRETARY’S
CERTIFICATE



I,
Richard Schumacher, Asst. Clerk of BBI-BIOTECH RESEARCH
LABORATORIES, INC., a Massachusetts corporation, do hereby certify (i) that the foregoing and annexed Lease was
executed and delivered pursuant to, and in strict conformity with the provisions of
resolutions of the Board of Directors of said Corporation validly adopted at a regularly
called meeting of said Board of Directors, and that a quorum was present at said meeting
(or validly adopted by unanimous written consent of said Board of Directors in lieu of a
meeting), in conformity with the laws of the state of incorporation of said Corporation;
and (ii) that the following is a true, correct and complete reproduction of such resolutions:




RESOLVED: That
                                                                                   
    
                 
                  
                  
                    
                  



(Name)                                          (Title)



of the Corporation, shall be and is hereby authorized and empowered, for and on behalf of
the Corporation, to execute,
acknowledge and deliver the foregoing and annexed Lease between B.F. Saul Real Estate
Investment Trust, as Landlord,
and BBI-Biotech Research Laboratories, Inc., as Tenant, for those certain Premises,
containing approximately Twenty-Five
Thousand (25,000) rentable square feet of space, located in the Building at 215 Perry
Parkway, Avenel Business Park,
Gaithersburg, Maryland, at an annual Initial Base Rent of approximately Three Hundred
Twenty-Five Thousand and 00/100
Dollars ($325,000.00), as well as any and all related documents, in order to expeditiously
provide for the leasing of such
Premises, and in so doing, to make any and all related changes therein or modifications
thereof as he, in his sole discretion,
acting for and on behalf of the Corporation, shall deem necessary or advisable, and all of
the officers of the Corporation
are hereby authorized, directed and empowered to do any and all acts or things as shall be
necessary or advisable in order
to effectuate the foregoing resolution.




/s/
Richard T.
Schumacher             Ass’t Clerk




(Corporate Seal)




PRINTED NAME: RICHARD T. SCHUMACHER




Date: May 6, 1997





27









 








CORPORATE
GUARANTY





     FOR VALUE RECEIVED, and in consideration for, and as an inducement to Landlord to enter into
the foregoing Lease with BBI-Biotech Research Laboratories, Inc., a Massachusetts corporation, dated
the
                
     
        day of  
                 
         
   
     
         , 1997, the undersigned hereby guarantees to Landlord, its legal representatives, successors
and assigns, the payment of the rent, additional rent and all other payments to be made by Tenant under
said Lease and the full performance and observance by Tenant of all the other terms, covenants,
conditions and agreements (including the Rules and Regulations) therein provided to be performed
and observed by Tenant for which the undersigned shall be jointly and severally liable with the
Tenant, without requiring any notice of non-payment, non-performance or non-observance, or proof of
notice or demand, whereby to charge the undersigned, all of which the undersigned hereby expressly
waives, and the undersigned expressly agrees that Landlord may proceed against the undersigned
separately or jointly before or after or simultaneously with proceeding against Tenant for default
and that this Guaranty shall not be terminated, affected or impaired in any way or manner
whatsoever by reason of the assertion by Landlord against Tenant of any of the rights or remedies
reserved to Landlord pursuant to the provisions of the said Lease, or by reason by summary or other
proceedings against Tenant, or by the omission of Landlord to enforce any of its rights against
Tenant, or by reason of any extension of time or indulgence granted by Landlord to Tenant. The
undersigned further covenants and agrees (i) that it will be bound by all the provisions, terms,
conditions, restrictions and limitations contained in said lease, the same as though Guarantor was
named therein as Tenant; and (ii) that this Guaranty shall be absolute and unconditional and shall
remain and continue in full force and effect as to any renewal, extension, option, amendment,
additions, assignment, sublease, transfer, or other modification of said lease, whether or not the
undersigned shall have knowledge or have been notified of or agreed or consented to any such
renewal, extension, option, amendment, addition, assignment, sublease, transfer, or other
modifications of said lease. Each signatory hereto shall be individually bound by the terms of this
Guaranty whether or not any other party or person has executed the same. If Landlord at any time is
compelled to take any action or proceeding in court or otherwise to enforce or compel compliance
with the terms of this Guaranty, the undersigned shall, in addition to any other rights or remedies
to which Landlord may be entitled hereunder or as a matter of law or in equity, be obligated to pay
all costs, including attorneys’ fees, incurred or expended by
Landlord in connection therewith. All
obligations and liabilities of Guarantor pursuant to this Guaranty shall be binding upon the
successors and assigns of the undersigned signatory. Guarantor further agrees, at any time and from
time to time, within five (5) days’ after written notice by Landlord, to deliver to Landlord its
most recent financial statement, which shall not, in any event, be more than ninety (90) days old.
If Guarantor files quarterly and annual statements with the Securities and Exchange Commission,
then Guarantor’s most recent “10-Q” (or, if applicable, “10-K”) statement shall be supplied to
Landlord. If Guarantor has its financial statements audited on an annual basis, then Guarantor
shall supply Landlord with its most recent audited statement and with its most recent unaudited
financial statement, certified to be true and correct by Guarantor’s chief financial officer. If
Guarantor does not regularly have its financial statements audited, then Guarantor shall supply
Landlord with its most recent unaudited financial information, certified to be true and correct by
Guarantor’s chief financial officer, which information shall not, in any event, be more than ninety
(90) days old. If Guarantor does not regularly have financial statements prepared, then Guarantor
shall supply Landlord with such financial information respecting the financial condition of
Guarantor as Landlord may reasonably require including, without limitation, copies of Guarantor’s
state and federal quarterly and annual income tax reports and statements, certified to be true and
correct by Guarantor or Guarantor’s chief financial officer.



     As further inducement to Landlord to make and enter into said Lease, and in consideration
thereof, the Landlord and the undersigned covenant and agree that in any action or proceeding
brought on, under or by virtue of this Guaranty, the Guarantor shall and hereby does waive trial
by jury. This Guaranty shall be governed by and construed in accordance with the laws of the state
in which the property demised under the said lease is located.



28









 





     WITNESS the following signatures this 6th day of May, 1997.



	 	 	 	 	 	 
	ATTEST:  	 	GUARANTOR:

Boston Biomedica, Inc., a MA corporation

 	 
	/s/
Richard T. Schumacher 	 	By:  	/s/ Kevin W. Quinlan
 	 
	 	 	 	Printed Name:  	Kevin
W. Quinlan  	 
	(corporate seal) 	 	 	Title:  	 	 
	 	 	Address:  	 	 
	 	 	  	 	 
	 	 	  	 	 
	 	 	Tax I.D. No.  	04-265-2826 	 
	 




29











 





SECRETARY’S CERTIFICATE




     I,
Richard Schumacher,
Asst. Clerk of Boston
Biomedica, Inc., a MA
corporation do hereby certify (i) that the foregoing and annexed Guaranty was
executed
and delivered pursuant to, and in strict conformity with the provisions of resolutions of the Board
of Directors of said corporation validly adopted at a regularly called meeting of said Board of
Directors, and that a quorum was present at said meeting (or validly adopted by unanimous written
consent of said Board of Directors in lieu of a meeting), in conformity with the laws of the state
of incorporation of said Corporation; and (ii) that the following is a true, correct and complete
reproduction of said resolution:





RESOLVED: That __________________________________________________, President of the
Corporation, shall be, and is hereby authorized and empowered, for and on
behalf of the Corporation, to execute, acknowledge and deliver the
foregoing and annexed Guaranty of the Lease by and between B.F. Saul Real
Estate Investment Trust, as Landlord, and BBI-Biotech Research
Laboratories, Inc., as Tenant, for those certain Premises located at 215
Perry Parkway, Avenel Business Park, Gaithersburg, Maryland, as well as
any and all related documents, in order to expeditiously provide for the
leasing of such premises, and, in so doing, to make any and all changes
therein or modifications thereof as he, in his sole discretion, acting
for and on behalf of the Corporation, shall deem necessary or advisable,
and all of the officers of the Corporation are hereby authorized,
directed and empowered to do any and all acts or things as shall be
necessary or advisable in order to effectuate the foregoing resolution.



	 	 	 	 	 
	 

	 	/s/ Richard T. Schumacher
	,	Ass’t Clerk
	 

	 	 	 	 
	 

	 	Printed Name: RICHARD T. SCHUMACHER	 	 
	 

	 	Date: 5/6/97	 	 






(corporate seal)




30









 








AVENEL BUSINESS PARK — PHASE IV




215 PERRY PARKWAY

GAITHERSBURG, MARYLAND 20877




46,335 SQ. FT. RENTABLE









EXHIBIT A




 









 





AVENEL BUSINESS PARK — PHASE IV




215 PERRY PARKWAY

GAITHERSBURG, MARYLAND 20877




46,335 SQ. FT. RENTABLE









EXHIBIT A-1




 









 





EXHIBIT B




RULES AND REGULATIONS




     1. No advertisement, or other notice, shall be inscribed, painted or affixed on any part of
the outside or inside
of said Building, except of such order, size and style, and at such places as shall be
designated by Landlord. All signs
will be supplied for tenants by Landlord, the cost of the signs to be charged to and paid for
tenants.



     2. The sidewalks and entry passages shall not be obstructed by tenants, or used by them for
any purpose other
than for ingress and egress. The floors, and skylights and windows that reflect or admit light
into any place in said
Building, shall not be covered or obstructed by tenants. The water closets and other water
apparatus, shall not be
used for any other purpose than those for which they were constructed and no sweepings,
rubbish, or other obstructing
substances shall be thrown therein. Any damage resulting to them, or to associated systems,
from misuse, shall be
repaired by tenant who, or whose clerks, agents, invitees, or servants shall cause it.



     3. No tenant shall do or permit to be done in said Premises, or bring or keep anything
therein, which shall in
any way obstruct or interfere with the rights of other tenants or in any way injure or annoy
them. Tenants, their clerks
and servants, shall maintain order in the Building, shall not make or permit any improper
noise in the Building or
interfere in any way with other tenants or those having business with them. Nothing shall be
thrown by Tenants, their
clerks or servants, out of the windows, doors or skylights of the Building. No rooms shall be
occupied or used as
sleeping or lodging apartments at any time. No part of the Building shall be used or in any
way appropriated for
gambling, immoral or other unlawful practices, and no intoxicating liquor or liquors shall be
sold in said Building .



     4. It is understood and agreed that the Landlord shall not be responsible to any tenant for
any loss of property
from rented premises, however occurring .



     5. No bicycles or other vehicles or animals shall be allowed in the office, halls, corridors,
or elsewhere in the
Building. Notwithstanding anything contained herein to the contrary, Tenant shall be permitted
up to ten (10) small
rodents in the Premises provided the presence of same is incidentally related to Tenant’s use,
and Tenant is
responsible for all risks, costs and expenses related thereto.



     6. All tenants and occupants shall observe strict care not to leave their doors open when it
rains or snows, and
for any fault or carelessness in this respect shall make good any injury sustained by other
tenants, and to Landlord for
damage to paint, plastering or other parts of the Building resulting from such default or
carelessness. No alterations
shall be made to any part of the Building by putting up or changing any partitions, doors or
windows, nor shall there
be any connection made to the electric wires or electric fixtures, or plumbing lines nor shall
there be any penetrations
through the walls, floor or roof without the consent in writing on each occasion of Landlord
or its Agent. All glass, locks
and trimmings in or upon the doors and windows of the Building shall be kept whole and, when
any part thereof shall
be broken, the same shall be immediately replaced or repaired and put in order under the
direction and to the
satisfaction of Landlord, or its Agent, and shall be left whole and in good repair. Tenant
shall not injure, overload or
deface the Building, the woodwork or the walls of the Premises, nor carry on upon the Premises
any noisesome,
noxious, noisy, or offensive business.



     7. An adequate number of keys will be provided upon initial occupancy; the charge for
additional keys shall
be Five Dollars ($5.00) each. No additional locks or latches shall be put upon any door
without written consent of
Landlord. Tenants, at termination of their lease of the premises, shall return to Landlord,
all keys to doors in the
Building.



     8. Landlord in all cases retains the power to prescribe the weight and position of iron safes
or other heavy
articles.



 









 





     9. The tenant shall not (without the Landlord’s prior written consent) install or operate any
electric heating
device, steam engine, boiler, machinery or stove upon the Premises, or carry on any mechanical
business thereon,
or do any cooking thereon, or use or allow to be used upon the Demised Premises oil, burning
fluids, camphene,
gasoline or kerosene for heating, warming or lighting. No article deemed extra hazardous on
account of fire and no
explosives shall be brought into said Premises. No offensive gases or liquids will be
permitted.



     10. If tenants desire blinds or window covering, other than those provided by Landlord, if
any, they must be of
such shape, color and material as may be prescribed by Landlord, and shall be erected with
Landlord’s prior consent
and at the expense of said tenants. No awnings shall be placed on said Building.



     11. Any vending machines or services on the Demised Premises shall be for the exclusive use of
the Tenant
and its employees. Public use of vending machines and services is explicitly prohibited.



     12. Except for the storage of trash or rubbish in dumpsters provided by Landlord, Tenant shall
not permit
storage of any kind outside of the Premises.



     13. Subject to Articles 22 and 52 of the Lease, Tenants and occupants shall observe and obey
all parking and
traffic regulations as imposed by Landlord on the Property. Landlord in all cases retains the
power to designate “No
Parking” zones, traffic right of ways, and general parking area procedures.



     14. Tenant shall instruct all delivery companies that any vehicles making deliveries to the
Demised Premises
shall use the truck access road provided for such use and park only in designated loading
areas.



     15. Unless otherwise agreed upon, in writing, Landlord will arrange and contract for all
heating, ventilating and
air conditioning maintenance and repairs.



     16. Unless otherwise approved by Landlord, in writing, neither Tenant, nor Tenant’s agents,
invitees, or
contractors shall be permitted access to the roof of the Building.



     17. The Landlord reserves the right to make such other rules and regulations as in its
reasonable judgement
may from time to time be needed for the safety, care and cleanliness of the Premises, and for
the preservation of order
therein, provided such rules and regulations do not materially, adversely affect Tenant’s use
and occupancy of the
Premises or materially increase Tenant’s financial obligations associated therewith.



     18. Violation of these rules, or any amendments thereof or additions thereto, shall be
sufficient cause for
termination of this Lease at the option of Landlord.



 









 





EXHIBIT C




INTENTIONALLY OMITTED.




 









 





EXHIBIT D

BBI-BIOTECH RESEARCH LABORATORIES, INC.

COMMENCEMENT AND ESTOPPEL




     THIS COMMENCEMENT AND ESTOPPEL AGREEMENT is made and entered into this           day of
                    , 19      , by and between BBI-Biotech Research Laboratories, Inc., (“Tenant”) and B.F. SAUL REAL
ESTATE INVESTMENT TRUST (“Landlord”).



     WHEREAS, Landlord and Tenant have heretofore entered into that certain Lease Agreement dated                                         
(the “Lease”), for certain space at Suite No. 1, 215 Perry Parkway, Avenel Business Park,
Gaithersburg,
Maryland.



     WHEREAS, paragraph 2 of the Lease provides for the execution of a commencement agreement
specifying the commencement date of the term of the Lease;



     NOW, THEREFORE, in consideration of the premises, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, each party hereby
warrants and represents to the other as follows:




	 	1.	That Tenant is in full and complete possession of the Demised Premises, such
possession having been
delivered by the Landlord and having been accepted by the undersigned.
	 
	 	2.	That the Landlord’s improvements, if any, and the space required to be
furnished by the terms of the
Lease have been completed in all respects and are open for the use of the Tenant, its
customers,
employees and invitees.
	 
	 	3.	That all duties of an inducement nature required of the Landlord in said Lease have been
fulfilled.
	 
	 	4.	That said Lease is in full force and effect; that there is no existing default
on the part of the Landlord
in the terms thereof, and that said Lease has not been amended, modified, supplemented
or superseded.
	 
	 	5.	That no rents have been prepaid except as provided by said Lease; that Tenant
does not now have or
hold any claim against Landlord which might be set off or credited against future
accruing rent.
	 
	 	6.	That Tenant has received no notice of a prior sale, transfer, assignment,
hypothecation or pledge of the
said Lease or of the rents secured therein, except to Landlord.
	 
	 	7.	That the Rent Commencement Date for the Lease is the             day of                     , 19             and
the Lease shall expire at midnight on the              day of                     , 19      .




 









 












	 	8.	Any agreement, obligation, or liability made, entered into or incurred by or on
behalf of B.F. Saul Real Estate Investment Trust binds only its trust property, and no
shareholder, trustee, officer, or agent of the trust assumes or shall be held to any
liability therefor.





     IN WITNESS WHEREOF, the parties hereto do hereby execute this Agreement under seal on the day
and year first above written.



	 	 	 	 	 	 	 	 	 	 	 
	ATTEST:	 	 	 	TENANT:	 	 	 	 
	 	 	 	 	BBI-BIOTECH RESEARCH LABORATORIES, INC.,

a Massachusetts corporation	 	
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	 	 
	 	 	 	 	 	Printed Name:	 	 	 
	 

	 	 	 	 	Title:  	 

	 	 
	 	 	 	 	 	 	 
	 
	 
	ATTEST:	 	 	 	LANDLORD:	 	 	 	 
	 	 	 	 	B.F. SAUL REAL ESTATE INVESTMENT TRUST	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	 	 
	 	 	 	 	 	Printed Name:	 	 	 
	 

	 	 	 	 	Its:	 	 








 









 






EXHIBIT E




TO LEASE BETWEEN B.F. SAUL REAL ESTATE INVESTMENT TRUST

& BBI-BIOTECH RESEARCH LABORATORIES, INC.

OUTLINE OF LANDLORD’S WORK:

“COLD DARK SHELL”



Landlord shall perform the work described below in accordance Landlord’s Plans.





	1.	 	FRAME
	 
	 	 	A structural frame of steel, concrete or masonry construction, or any combination of these,
with a floor design to carry and provide for 150 psf load. Clear height to the bottom of the
roof joists shall be approximately 13’-6” to 14’-6” except in Tenant’s “Repository”,
approximately 6,000 sf in the rear of the Premises, which shall be a minimum of 16’-0”.
	 
	2.	 	ROOF
	 
	 	 	A roof system, as designed by Landlord and in accordance with applicable
building codes.
	 
	3.	 	EXTERIOR WALLS
	 
	 	 	Exterior building walls shall be of non-combustible construction as provided by Landlord.
Landlord will provide a brick exterior in the front of the building and a painted block
(Standard CMU)exterior at the rear of the building.
	 
	4.	 	FLOOR SYSTEM.
	 
	 	 	Landlord will provide a 5” thick concrete floor slab.
	 
	5.	 	PLUMBING
	 
	 	 	Landlord will provide a 4” sanitary waste line to the building to be shared by all
tenants. Tenant shall be solely responsible for all costs of obtaining required water
meter(s).
	 
	6.	 	ELECTRICAL SERVICE
	 
	 	 	Landlord will provide 2,000 Amps to the building via a 480/277 volt, 3-phase, 4-wire
electrical service, to be shared by all tenants.
	 
	 	 	Tenant shall apply to the local utility company to have electric service established in
its name and shall be solely responsible for all costs of obtaining such service and for
all costs of providing and installing the required electric meter(s).
	 
	7.	 	FIRE PROTECTION
	 
	 	 	Landlord will provide a complete, automatic wet sprinkler system, installed facing the
underside of the roof deck. Landlord will provide approximately one sprinkler head per
150 sf of Premises with sprinkler heads turned up.
	 
	8.	 	HEATING, VENTILATING, AND AIR-CONDITIONING (HVAC)
	 
	 	 	HVAC system(s) and unit(s) will be included as part of the Interior Improvements.
	 
	9.	 	STOREFRONT
	 
	 	 	Landlord will construct a complete storefront including, without limitation, glass and
glazing and door(s).