**Exhibit 10.30**

** **

**Basic Lease Information**
| Date:                               |   | July  11, 2001                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|-------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Tenant:                             |   | Deltagen,  Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Address:                            |   | 740  Bay Road Redwood City, CA 94063                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Landlord:                           |   | Woodside  Technology Center, LLC                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Landlord’s Address For Notice: |   | Woodside  Technology Center, llc  505 Montgomery Street, Suite 1550   San Francisco, California  94111   Attn:  Daniel MacEachron **with a  copy to**:   Hines 101 California Street, Suite 1000   San Francisco, California 94111   Attn:  Lisa Burke Lewis **and a  copy to**:   Hines   601 California Street, Ground Floor   San Francisco, California 94108   Attn:  Property Manager, Woodside  Technology Center |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Leased Premises:                    |   | 740  Bay Road, Redwood City, CA, located within The Woodside Technology Center                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Area of Leased Premises:            |   | Sixty  Thousand Nine Hundred Eighty–Five (60,985) square feet                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Term Commencement Date:             |   | September  1, 2001                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Term:                               |   | approximately  107 Months                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Term Expiration Date:               |   | July  14, 2010                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |

**Basic Lease Information**

| Base Rent:        |   | Months of Term                                                                                                                                             | Monthly Base Rent |
|-------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------|
|              |        |                                                                                                                                                            |
|              |   |                                                                                                                                                       |              |
|              |   | 1 - 12                                                                                                                                                     | $189,053.50       |
|              |   |                                                                                                                                                       |              |
|              |   | 13 - 24                                                                                                                                                    | $194,725.11       |
|              |   |                                                                                                                                                       |              |
|              |   | 25 - 36                                                                                                                                                    | $200,566.86       |
|              |   |                                                                                                                                                       |              |
|              |   | 37 - 48                                                                                                                                                    | $206,583.87       |
|              |   |                                                                                                                                                       |              |
|              |   | 49 - 60                                                                                                                                                    | $212,781.39       |
|              |   |                                                                                                                                                       |              |
|              |   | 61 - 72                                                                                                                                                    | $219,164.83       |
|              |   |                                                                                                                                                       |              |
|              |   | 73 - 84                                                                                                                                                    | $225,739.77       |
|              |   |                                                                                                                                                       |              |
|              |   | 85 - 96                                                                                                                                                    | $232,511.96       |
|              |   |                                                                                                                                                       |              |
|              |   | 97 – July 14,  2010                                                                                                                              | $239,487.32       |
|              |   |                                                                                                                                                       |              |
| Letter of Credit: |   | One  Million Seven Hundred One Thousand Four Hundred Eighty–One Dollars  ($1,701,481.00), subject to adjustment in accordance with Section 5.14. |
|              |   |                                                                                                                                                       |
| Broker:           |   | BT  Commercial Real Estate                                                                                                                                 |
|              |   |                                                                                                                                                       |
| Option To Renew:  |   | Two  (2) Options of Five (5) Consecutive Years Each                                                                                                        |

 

 

| **BUILDING LEASE** by and between **WOODSIDE TECHNOLOGY CENTER, LLC,a Delaware limited liability company**  and **DELTAGEN, INC.,  a Delaware corporation** |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

 

**WOODSIDE TECHNOLOGY CENTER**

             ThisLease is made and entered into as of the date specified in the Basic LeaseInformation Sheet attached hereto and incorporated herein by this reference, byand between WOODSIDE TECHNOLOGYCENTER, LLC, a Delaware limited liability company (“**Landlord**”), and the Tenantidentified in the Basic Lease Information Sheet.

             INCONSIDERATION OF THE MUTUAL COVENANTS AND AGREEMENTS CONTAINED IN THIS LEASE,THE PARTIES AGREE AS FOLLOWS:

**ARTICLE 1**

**Definitions**

             Certainterms used in this Lease and the Exhibits hereto shall have the meaning setforth below for each such term.  Certainother terms shall have the meaning set forth elsewhere in this Lease and theExhibits hereto.

             **1.01     “****AdditionalRent****”**shall mean all obligations of Tenant hereunder other than the obligation forpayment of Gross Rent.

             **1.02     “****Alterations****”**shall mean any alterations, additions or improvements in or to the LeasedPremises made in accordance with Section 5.07, including, withoutlimitation, any equipment, fixtures or similar items which are either affixedto any portion of the Building or affixed or connected to, or otherwiseintegrated within, any of the Building Systems by or on behalf of Tenant.

             **1.03     “****BaseRent****”**shall mean the basic rent payable by Tenant to Landlord in the amounts shown onthe Basic Lease Information sheet and in the manner provided inSection 3.03.

             **1.04     “****Building****”**shall mean the improvements known as 740 Bay Road located in Redwood City,California.

             **1.05     “****Building Operating Cost****”** shall mean the portionof the Project Operating Cost which is allocated to the tenants of the Buildingpursuant to Section 3.06.

**             1.06     “****Building Operating Cost Adjustment****”** for any calendar yearshall mean the difference, if any, between Estimated Building Operating Costand Building Operating Cost for that calendar year.

**             1.07     “****Building Systems****”** shall mean allmechanical, electrical, HVAC, life safety or other systems of the Building.

**             1.08     “****businessday****”**shall mean Monday through Friday, except holidays; “**holiday**”means those holidays specified by the laws of the United States or the State ofCalifornia.
**             1.09     “Common Areas”**shall mean all walkways, roadways, sidewalks, parkways, driveways, parkingareas, parking structures, landscaped areas or other similar facilitiesmaintained for the benefit of Project Tenants and invitees.

**             1.10     “****EstimatedBuilding Operating Cost****”**for any calendar month shall mean the portion of the Estimated ProjectOperating Cost which Landlord estimates to be allocable to the tenants of theBuilding pursuant to Section 3.06 for such calendar month.

**             1.11     “****Estimated Project Operating Cost****”** for any calendar monthshall mean Landlord’s estimate of Project Operating Cost for the calendar yearwithin which such month falls divided by twelve (12) equal monthlyinstallments.

**             1.12     “****FairMarket Rent****”**shall mean the rate being charged for comparable space within first-classcommercial office and R&D properties comparable to the Project located incentral and southern San Mateo County, including, without limitation, therate being charged by Landlord for comparable space within the Project, takinginto consideration:  location in theBuilding, tenant improvements or allowances existing or to be provided, rentalabatements, lease takeovers/assumptions, moving expenses and other forms ofrental concessions, proposed term of lease, extent of service provided or to beprovided, the ownership of the comparable space, whether or not the transactionis a sublease, the time the particular rate under consideration became or is tobecome effective and any other relevant terms or conditions.

**             1.13     “****GrossRent****”**shall mean the total of Base Rent and Tenant’s Proportionate Share of EstimatedBuilding Operating Cost.

**             1.14     “****HazardousMaterial****”**shall mean any:  (a) oil, flammablesubstances, explosives, radioactive materials, hazardous wastes or substances,toxic wastes or substances or any other wastes, materials or pollutants which(i) pose a hazard to the Project or to persons on or about the Project or(ii) cause the Project to be in violation of any Hazardous Materials Laws;(b) asbestos in any form, urea formaldehyde foam insulation, transformersor other equipment that contain dielectric fluid containing levels ofpolychlorinated biphenyls, or radon gas; (c) chemical, material orsubstance defined as or included in the definition of “hazardous substances”,“hazardous wastes”, “hazardous materials”, “extremely hazardous waste”,“restricted hazardous waste”, or “toxic substances” or words of similar importunder any applicable local, state or federal law or under the regulationsadopted or publications promulgated pursuant thereto, including, but notlimited to, the Comprehensive Environmental Response, Compensation andLiability Act of 1980, as amended, 42 U.S.C. §9601, *et seq*.; the Hazardous MaterialsTransportation Act, as amended, 49 U.S.C. §1801, *et seq*.; the Federal Water PollutionControl Act, as amended, 33 U.S.C. §1251, *et seq*.;Sections 25115, 25117, 25122.7, 25140, 25249.8, 25281, 25316, and 25501 ofthe California Health and Safety Code; (d) other chemical, material orsubstance, exposure to which is prohibited, limited or regulated by anygovernmental authority or may or could pose a hazard to the health and safetyof the occupants of the Project or the owners and/or occupants of propertyadjacent to or surrounding the Project, or any other person coming upon theProject or adjacent property; and (e) other chemicals, materials orsubstances which may or could pose a hazard to the environment.
**             1.15     “Hazardous Materials Claims”**shall mean any enforcement, cleanup, removal, remedial or other governmental orregulatory actions, agreements or orders instituted pursuant to any HazardousMaterials Laws; and any claims made by any third party against Landlord, Tenantor the Project relating to damage, contribution, cost recovery, compensation,loss or injury resulting from the presence, release or discharge of anyHazardous Materials.

**             1.16     “****HazardousMaterials Laws****”**shall mean any federal, state or local laws, ordinances, orders, rules,regulations or policies, now or hereafter in force, as amended from time totime, in any way relating to the environment, health and safety, and HazardousMaterials (including, without limitation, the use, handling, transportation,production, disposal, discharge or storage thereof) or to industrial hygiene orthe environmental conditions on, under or about the Project, including, withoutlimitation, soil, groundwater and indoor and ambient air conditions.  Landlord hereby notifies Tenant inaccordance with California Health & Safety Code Section 25359.7 thatthe Project is the subject of a state-supervised cleanup of hazardous wastedisposed of on the site by prior occupants and in connection therewith, a nofurther action letter was issued by the Bay Area Regional Water Quality Boardon July 18, 1997.

**             1.17     “****LandlordParties****”**means the employees, agents, contractors, officers, directors, partners,licensees, invitees and guests of Landlord, Landlord’s affiliates, Landlord’smanager and members and their respective members, managers, shareholders,general partners and limited partners.

**             1.18     “****Laws****”**shall mean all federal, state and local laws, ordinances, orders, rules,regulations and policies.

**             1.19     “****LC FaceAmount****”**shall mean the face amount of the Letter of Credit as determined pursuant toSection 5.14.

**             1.20     “****LeasedPremises****”**shall mean the floor area more particularly shown on the ***Exhibit A–1***floor plan attached hereto, containing the square footage specified on theBasic Lease Information sheet.

**             1.21     “****Letterof Credit****”**  shall mean the irrevocable standby letter ofcredit in the “**LC Face Amount**” to bedelivered by Tenant to Landlord to be held pursuant to Section 5.14.

**             1.22     “****PermittedHazardous Materials****”**shall mean Hazardous Materials in quantities and of a type customarily used inthe ordinary course of business operations of a business similar to thebusiness in which Deltagen, Inc. is engaged in at the time of execution of thisLease, but only if and to the extent that such Hazardous Materials aretransported, stored and used in full compliance with all Hazardous MaterialsLaws and otherwise in a safe and prudent manner.  Hazardous Materials which are customarily used in the ordinarycourse of business operations of businesses similar to the business in whichDeltagen, Inc. is engaged in at the time of execution of this Lease, but whichare transported, stored and used in a manner which is not in full compliancewith all Hazardous Materials Laws or which is not in any respect safe andprudent shall not be deemed to be “**Permitted Hazardous Materials**”for the purposes of this Lease. Notwithstanding the foregoing, “**PermittedHazardous Materials**” shall only include Hazardous Materialsof a type and in quantities which have been identified to Landlord in writingfrom time to time.
**             1.23     “Permitted Use”**shall mean executive, professional office and corporate administrative officeuses, research and development uses in the area of biotechnology andpharmaceuticals and ancillary warehousing; provided, however, that for thepurpose of limiting the type of use permitted by Tenant, or an assignee ofTenant, but without limiting Landlord’s right to lease any portion of theBuilding to a tenant of Landlord’s choice, except as specifically otherwiseagreed by Landlord in writing, “**Permitted Use**”shall not include (i) any use not otherwise permitted under applicablezoning ordinances, (ii) offices of any agency or bureau of the UnitedStates or any state or political subdivision thereof, (iii) offices oragencies of any foreign government or political subdivision thereof,(iv) offices of any health care professionals or service organization,except for administrative offices where no diagnostic, treatment or patientlaboratory services are performed, (v) schools or other trainingfacilities that are not ancillary to executive, professional or corporateadministrative office use, (vi) retail or restaurant uses,(vii) broadcast studios or other broadcast production facilities, such asradio and/or television stations, (viii) product display or demonstrationfacilities, (ix) offices at which deposits or bills are regularly paid inperson by customers, and (x) personnel agencies, except offices ofexecutive search firms.

**             1.24     “****Project****”**shall mean the real property (including, without limitation, the Building, theCommon Areas and any other present or hereafter existing improvements), as suchreal property may be expanded from time to time by Landlord, situated in theCity of Redwood City, County of San Mateo and more particularly describedon ***Exhibit A–2***.

**             1.25     “****Project Operating Cost****”** shall have the meaninggiven in Section 3.05.

**             1.26     “****Rent****”**shall mean Gross Rent, Additional Rent and any and all other charges of anynature payable by Tenant to Landlord under this Lease.

**             1.27     “****TenantParties****”**shall mean the employees, agents, contractors, officers, directors, partners,licensees, invitees and guests of Tenant.

**             1.28     “****Tenant’sProportionate Share****”**shall mean one hundred percent (100%) of the Building.

**             1.29     “****Term****”**shall mean the period from the Term Commencement Date and ending on the TermExpiration Date, as the same may be extended pursuant to Section 7.09.

**             1.30     “****TermCommencement Date****”**shall mean the date when the Term commences as set forth on the Basic LeaseInformation sheet.

**             1.31     “****TermExpiration Date****”**shall mean the date set forth on the Basic Lease Information or such earlierdate upon which this Lease is terminated pursuant to the terms hereof.

**ARTICLE 2**

**Leased Premises**

**             2.01    ****Lease****.**  Landlord leases to Tenant and Tenant leasesfrom Landlord the Leased Premises upon all of the terms, covenants andconditions set forth herein.

**             2.02    ****Landlord’sReserved Rights****.**  Landlord reserves from the leasehold estatehereunder, in addition to all other rights reserved by Landlord under thisLease:  (i) the roof of theBuilding, provided, that Tenant may have access to the roof for the purpose ofinstallation of Antenna Equipment in accordance with Section 5.07(b)below, (ii) all exterior walls and windows bounding the Leased Premises,and (iii) the right from time to time, without unreasonable interferencewith Tenant’s use, to alter or relocate any portion of the Common Areas or anyother common facility and to make changes or alterations or additions to theProject or any portion thereof.  Subjectto the rights of Tenant specified in this Lease as to the non-exclusive use ofcertain portions of the Common Areas, Landlord shall have the sole andexclusive right to possession and control of the Common Areas and all otherareas of the Project outside the Leased Premises.  Subject to Landlord’s approval of the same as Alterations to theLeased Premises pursuant to Section 5.07 below, Tenant shall install andmaintain all required intrabuilding network cable and other communicationswires and cables necessary to serve the Leased Premises from the point ofpresence to the Project of a telecommunications provider selected by Tenant andapproved by Landlord in its reasonable discretion (and Tenant herebyacknowledges and agrees that Tenant shall not obtain any telecommunicationsservices within the Building from vendors other than those so approved byLandlord in its reasonable discretion).

**ARTICLE3**

**Rent,Term, Use and Building Operating Costs**

**             3.01    ****Term****.**

             (a)         Subject to Sections 3.01(b) and3.01(c), the Term of this Lease shall commence and Tenant shall be entitled topossession of the Leased Premises upon the TermCommencement Date and shall continue until the Term Expiration Date, unlessearlier terminated in accordance with the provisions of this Lease.  Upon the Term Commencement Date, Landlordand Tenant shall exercise a Lease Commencement Certificate in the form of ***Exhibit C***attached hereto.

             (b)        If forany reason whatsoever, Landlord cannot deliver possession of the LeasedPremises to Tenant on or before the Term Commencement Date, except as expresslyprovided below, this Lease shall not be void or voidable, nor shall Landlord,or the Landlord Parties, be liable to Tenant for any loss or damage resultingtherefrom.  Tenant shall not be liablefor Rent until Landlord delivers possession of the Leased Premises toTenant.  The Term Expiration Date shallbe extended by the same number of days that Tenant’s possession of the LeasedPremises was delayed beyond the original Term Commencement Date.  Notwithstanding the foregoing, Landlordshall use commercially reasonable efforts to deliver possession of the LeasedPremises to Tenant on or before December 1, 2001, provided that, ifLandlord fails to deliver possession of the Leased Premises to Tenant on orbefore February 2, 2002, Tenant shall have the right to terminate thisLease by written notice delivered to Landlord not later than February 8,2002 and neither party shall have any further rights or obligationshereunder.  If Tenant fails to exercisesuch right of termination, on or before the date set forth herein, this Leaseshall remain in full force and effect, provided that, Tenant shall not beliable for Rent until Landlord delivers possession of the Leased Premises toTenant and the Term Expiration Date shall be extended by the same number ofdays that Tenant’s possession of the Leased Premises was delayed beyond theoriginal Term Commencement Date.
             (c)          Notwithstanding anything to the contrary herein,this Lease shall become effective and binding upon Landlord and Tenant onlyupon the satisfaction of each of the following conditions precedent:(i) Landlord’s valid and effective exercise of its right to recapture theLeased Premises from the current tenant, Kana Communications, Inc., aCalifornia corporation (“**Kana**”); and(ii) the mutual execution by Tenant and Heartport, Inc., a Delawarecorporation, of a sublease agreement with respect to space within the buildingof the Project commonly known as 700 Bay Road, Redwood City, California,and receipt of Landlord’s corresponding consent thereto.  If either of the foregoing conditionsprecedent have not been satisfied or waived by Tenant and Landlord withinthirty (30) days after the date of this Lease, then either Tenant or Landlordmay terminate this Lease upon not less than ten (10) days written notice to theother, whereupon such termination the provisions of this Lease shall be nulland void and, except with respect to Landlord’s return to Tenant of any letterof credit and prepaid Rent amounts delivered or otherwise paid to Landlord by Tenant,neither party shall have any obligation thereafter with respect to the LeasedPremises or this Lease. Notwithstanding the foregoing, Landlord will not voluntarily agree toallow Kana to holdover in the Leased Premises.

**             3.02    ****Use****.**  Tenant shall use the Leased Premises solelyfor the Permitted Use and for no other use or purpose.

**             3.03    ****Paymentof Base Rent and Tenant’s Proportionate Share of Estimated Building OperatingCost****.**  Base Rent shall be payable in advance on orbefore the first day of each calendar month during the Term and any extensionsor renewals thereof; provided, however, that Base Rent for the first fullcalendar month following the Term Commencement Date shall be paid in advanceimmediately upon execution of this Lease. Tenant’s Proportionate Share of Estimated Building Operating Cost shallbe payable in advance on or before the first day of each calendar month duringthe Term and any extensions or renewals thereof.  If the Term commences on other than the first day of a calendarmonth, then Gross Rent (consisting of Base Rent plus Tenant’s ProportionateShare of Estimated Building Operating Cost) provided for such partial calendarmonth shall be prorated and the prorated amount shall be paid on the first dayof the calendar month following the Term Commencement Date together with anyother amounts payable on that day.  Ifthe Term terminates on other than the last day of a calendar month, then GrossRent provided for such partial calendar month shall be prorated and theprorated installment shall be paid on the first day of the calendar monthpreceding the Term Expiration Date.  Allpayments due under this paragraph shall be payable in advance, without demandand without reduction, abatement, counterclaim or setoff, at the address specifiedon the Basic Lease Information or at such other address as may be designated byLandlord in the manner provided for giving notice under Section 7.17hereof.
**             3.04    ****NetLease****.**  Subject to Sections 3.05(b) below and4.01 below, the provisions for payment of Building Operating Cost by means ofperiodic payment of Tenant’s Proportionate Share of Estimated BuildingOperating Cost and the Building Operating Cost Adjustment are intended to passon to Tenant and reimburse Landlord for Tenant’s Proportionate Share of allcosts and expenses relating to Landlord’s ownership and operation of theProject and the Building.

             **3.05**     **Project Operating Cost****.**

             (a)         ProjectOperating Cost shall mean all expenses and costs (but not specific costs thatare separately billed to and paid by specific tenants) of every kind and naturethat Landlord shall pay or incur or become obligated to pay or incur(including, without limitation, costs incurred by managers and agents that arereimbursed by Landlord) because of or in connection with the management,maintenance, preservation, ownership and operation of the Project and itssupporting facilities directly servicing the Project (as allocated to theProject in accordance with generally accepted accounting principles,consistently applied) including, but not limited to, the following:

                           (i)          Wages,salaries and reimbursable expenses and benefits of all on-site and off-sitepersonnel (with the exception of any of Landlord’s employees or executivesabove the level of Senior Property Manager) who are engaged in the operation,maintenance and security of the Project and the direct costs of training suchemployees limiting such charges only to amounts directly allocable to servicesrendered by the employees and personnel for the benefit of the Project.

                           (ii)         Costsof the property management office and office operation.

                           (iii)        Allsupplies, materials and rental equipment used in the operation and maintenanceof the Project.

                           (iv)       Utilities,including, without limitation, water, power, waste disposal, communicationfacilities, and lighting serving the Common Areas.

                           (v)        Assessments,fees or other charges levied by the Project’s Property Owners Association orother similar body with respect to the maintenance, repair and operation of theProject.

                           (vi)       Allmaintenance, janitorial and service agreements for the Project and theequipment therein, including, but not limited to, alarm service, windowcleaning, elevator maintenance, maintenance and repair of sidewalks, stormwater pollution prevention, landscaping, building exteriors and service areas.

                           (vii)      A management cost recovery equal to threepercent (3%) of all revenue (excluding such management cost recovery) derivedfrom the Project, without limitation, all Rent hereunder, all rent and otherpayments derived from other tenants in the Building, parking revenues and otherrevenues derived from licensees of any other part of or right in the Building.
                           (viii)     Legaland accounting services for the Project, including, but not limited to, the costsof audits by certified public accountants of Project Operating Cost records;provided, however, that legal expense shall not include the cost of(i) negotiating lease terms for prospective tenants, (ii) negotiatingtermination or extension of leases with existing tenants,(iii) proceedings against any other specific tenant relating solely to thecollection of rent or other sums due to Landlord from such tenant,(iv) legal costs incurred in connection with the title to or developmentand/or construction of the Project, or (v) disputes with tenants, lenders,employees, managers or with shareholders or members of Landlord.

                           (ix)        Allinsurance premiums and costs, including, but not limited to, the premiums andcost of fire, casualty, liability, rental abatement and (subject to theprovisions of Section 7.01 below with respect to the maintenance ofearthquake insurance) earthquake insurance applicable to the Project andLandlord’s personal property used in connection therewith (and all amounts paidas a result of loss sustained that would be covered by such policies but for“deductible” or self-insurance provisions); provided, however, that Landlordmay, but shall not be obligated to, carry earthquake insurance.

                           (x)         Repairs,replacements and general maintenance (except for repairs and replacements(i) paid for from the proceeds of insurance, (ii) paid for directlyby Tenant, other tenants or any third party, or (iii) for the benefitsolely of tenants of the Project other than Tenant to the extent that Tenant couldnot obtain similar services from Landlord without an obligation to reimburseLandlord for the entire cost thereof under the provisions of this Lease).

                           (xi)        All real estate or personal propertytaxes, possessory interest taxes, business or license taxes or fees, servicepayments in lieu of such taxes or fees, annual or periodic license or use fees,including, but not limited to, all of the following:  (i) all real estate taxes and assessments, and all othertaxes relating to, or levied, assessed or imposed on, the Project, or anyportion thereof, or interest therein; (ii) all taxes, assessments,charges, levies, fees, excises or penalties, general and special, ordinary andextraordinary, unforeseen as well as foreseen, of any kind and nature imposed,levied upon, measured by or attributable to Landlord’s equipment, furniture,fixtures and other property used in connection with the operation of theProject, or levied upon, measured by or reasonably attributable to the cost orvalue of any of the foregoing; (iii) all other taxes (including, withoutlimitation, value added taxes), assessments, charges, levies, fees, orpenalties, general and special, ordinary and extraordinary, unforeseen as wellas foreseen, of any kind and nature imposed, levied, assessed, charged orcollected by any governmental authority or other entity either directly orindirectly (A) for or in connection with public improvements, user,maintenance or development fees, transit, parking, housing, employment, police,fire, open space, streets, sidewalks, utilities, job training, child care orother governmental services or benefits, (B) upon or with respect to thedevelopment, possession, leasing, operation, management, maintenance,alteration, repair, use or occupancy of, or business operations in, theProject, (C) upon, against or measured by the area of the Project, or usesmade thereof, or leases made to tenants thereof, or all or any part of therents collected or collectible from tenants thereof, and (D) forenvironmental mitigation matters imposed in connection with or as a result ofany environmental impact report affecting all or any portion of the Project,including parking taxes, employer parking regulations, or fees, charges orassessments as a result of the treatment of the Project, or any portion thereofor interest therein, as a source of storm water runoff; (iv) any tax orexcise, however described, imposed in addition to, or in substitution partiallyor totally of, any or all of the foregoing taxes, assessments, charges or fees;and (v) any and all costs, expenses and attorneys’ fees paid or incurredby Landlord in connection with any proceeding or action to contest in whole orin part, formally or informally, the imposition, collection or validity of anyof the foregoing taxes, assessments, charges or fees.  If by law any Real Property Taxes may be paid in installments atthe option of the taxpayer, then Landlord shall include within Real PropertyTaxes only those installments (including interest, if any) which would become dueby exercise of such option.  Real estatetaxes shall not include (i) inheritance or estate taxes imposed upon orassessed against the Project, or any part thereof or interest therein, or(ii) taxes computed upon the basis of the net income derived from theProject by Landlord or the owner of any interest therein.
                           (xii)       Amortization(together with reasonable financing charges) of capital improvements made tothe Project (i) to comply with the requirements of law, ordinance, rule orregulation, (ii) to replace items which Landlord would be obligated tomaintain under this Lease, or (iii) to improve the operating efficiency ofthe Project; provided, however, that in the case of improvements made solelyfor efficiency purposes, the amount chargeable as a Project Operating Cost inany year shall not exceed Landlord’s reasonable determination of the efficiencyachieved either in direct cost savings, avoidance of cost increases or acombination of both.  As used in thisSection 3.05(a)(xii), “**amortization**”shall mean allocation of the cost equally to each year of useful life of theitems being amortized or a shorter period equal to the number of years requiredto recover the cost of said item of capital improvement out of the savings inoperating efficiency derived therefrom. Notwithstanding the foregoing, however, Landlord may treat as expenses(chargeable in the year incurred) and not as capital costs items that are lessthan two percent (2%) of Estimated Project Operating Cost for the year inquestion.

             (b)        Notwithstandingthe provisions of Section 3.05(a) above, the following costs shall not beincluded within the calculation of Project Operating Cost:

                           (i)          costs incurred by Landlord for therepair of damage to the Building, to the extent that Landlord is reimburseddirectly therefor by any insurer or other third party;

                           (ii)         leasing commissions, finder’s fees,attorneys’ fees or similar costs associated with the leasing or subleasing ofspace within the Project;

                           (iii)        costs, including permit, license andinspection costs, incurred with respect to the installation of tenantimprovements made for tenants in the Project or incurred in renovating orotherwise improving, decorating, painting or redecorating vacant space fortenants or other occupants of the Project (excluding, however, such costsrelating to any Common Areas of the Project and/or any property managementoffice located at the Project);

                           (iv)       costs incurred by Landlord for whichLandlord is to be directly reimbursed by Tenant or other tenants of the Project(as opposed to costs which are reimbursed solely through inclusion within thecalculation of Project Operating Cost);

                           (v)        except as permitted withinSection 3.05(a)(xii) above, interest, principal, points and fees on debtor amortization of any mortgage or mortgages or any other debt instrumentencumbering the Building or the Project;
                           (vi)       any compensation paid to clerks,attendants or other persons in commercial concessions operated by the Landlord,with the exception of the costs of any such persons operating the parking areasat the Project to the extent such costs exceed any revenues generated from theoperation of such parking garage;

                           (vii)      except as permitted withinSection 3.05(a)(xii) above, costs which are considered capital improvementsunder generally accepted accounting principles, consistently applied;

                           (viii)     rental and leasing expenses (as opposed toany maintenance and repair expenses) in leasing air conditioning systems,elevators or other equipment affixed to the Building which is ordinarilyconsidered to be of a capital nature, with the exception of any such rental andleasing expenses for any such equipment for which Landlord would be permittedto include the amortized cost of acquisition (together with reasonable financingcharges) within the calculation of Project Operating Cost pursuant to theprovisions of Section 3.05(a)(xii) above;

                           (ix)        overhead or profit paid to subsidiariesor affiliates of Landlord for services (other than any management fee costrecovery), if and only to the extent that the cost of such services exceeds thecosts which would have been otherwise payable if the related services had beenrendered by qualified, first-class unaffiliated third parties on a competitivebasis;

                           (x)         costs for purchasing or replacingsculptures, paintings and other objects of art;

                           (xi)        advertising and promotionalexpenditures, and the costs of acquisition of any signs installed in or on theProject which identify the owner of the Project or any tenant of the Project;

                           (xii)       tax penalties and interest imposed as aresult of Landlord’s failure to make payments or to file returns when due,provided that such failure does not result from Tenant’s failure to timely payany amounts of Rent due and payable hereunder;

                           (xiii)      costs associated with the operation of thebusiness of the entity which constitutes the Landlord (as the same aredistinguished from the costs of operation of the Project), including Landlord’sgeneral corporate overhead;

                           (xiv)      costs arising from Landlord’s charitableor political contributions;

                           (xv)       costsincurred to comply with laws relating to the removal of any Hazardous Materialwhich was in existence on the Project prior to the date hereof, and was of sucha nature that a federal, state or municipal governmental authority, if it hadthen had knowledge of the presence of such Hazardous Material and of theconditions that then existed on the Project, would have then required theremoval of such Hazardous Material or other remedial or containment action withrespect thereto;

                           (xvi)      costsincurred to remove, remedy, contain, or treat any Hazardous Material which isbrought onto the Project after the date hereof by any tenant of the Project;and
                           (xvii)     fines, penalties, fees or similar costswhich are imposed as a result of Landlord’s willful misconduct or Landlord’sbreach of any contract related to the operation of the Project, including anyjudgments imposed upon Landlord or the Project as a result thereof.

             (c)         Notwithstanding any other provisionherein to the contrary, if the Project is not fully occupied during any year ofthe Term, an adjustment shall be made in computing the variable portions of theProject Operating Cost for such year so that Project Operating Cost shall becomputed as though the Project had been fully occupied during such year;provided, however, that in no event shall Landlord collect in total, fromTenant and all other tenants of the Project, an amount greater than one hundredpercent (100%) of the actual Project Operating Cost during any year of theTerm.

**             3.06    ****Allocationof Building Operating Cost****.**  The parties acknowledge that the Building isa part of a multi-building project (*i.e*.,the Project) and that the costs and expenses incurred in connection with theProject (*i.e*., the ProjectOperating Cost) should be shared between the tenants of the Building and thetenants of the other buildings in the Project, including, without limitation,the expenses and costs associated with the management, maintenance,preservation, ownership and operation of the Common Areas, presently orhereafter existing at the Project, that are, from time to time, allocated byLandlord, in its sole but reasonable discretion, between the Building and otherbuildings, presently or hereafter existing at the Project.  Accordingly, as set forth inSection 3.05 above, the Project Operating Cost shall be determinedannually for the Project as a whole, and a portion of the Project OperatingCost, which portion shall be reasonably determined by Landlord on an equitablebasis, shall be allocated to the tenants of the Building (as opposed to thetenants of any other buildings in the Project) and such portion shall be theBuilding Operating Cost for purposes of this Lease.  Such portion of the Project Operating Cost allocated to thetenants of the Building shall include all Project Operating Costs attributablesolely to the Building and an equitable portion of the Project Operating Costsattributable to the Project as a whole. Tenant agrees to pay as Additional Rent, Tenant’s Proportionate Share ofsuch Building Operating Cost as so equitably allocated by Landlord.

**             3.07    ****AdjustmentFor Variation Between Estimated and Actual****.**  If the Building Operating Cost Adjustmentfor any calendar year is a positive number (*i.e*.,actual cost exceeds estimated cost) Tenant shall pay to Landlord, pursuant toLandlord’s billing therefor (submitted pursuant to Section 3.08), Tenant’sProportionate Share of the Building Operating Cost Adjustment withinthirty (30) days after presentation of Landlord’s statement.  If the Building Operating Cost Adjustmentfor any calendar year is a negative number (*i.e*.,estimated cost exceeds actual cost), then Landlord at Landlord’s option shallpay Tenant’s Proportionate Share of the Building Operating Cost Adjustment toTenant in cash, within ten (10) days after the Building Operating CostAdjustment is finally determined, or credit said amount against futureinstallments of Estimated Building Operating Cost payable by Tenant hereunder.  Should the Term commence or terminate at anytime other than the first day of a calendar year, Tenant’s Proportionate Shareof the Building Operating Cost Adjustment shall be prorated for the exactnumber of calendar days during such calendar year that fall within the Term.
**             3.08    ****Computation of Building Operating Cost Adjustment****.**  Landlord shall, within a reasonable periodof time after the end of any calendar year for which Estimated BuildingOperating Cost differs from Building Operating Cost, give written notice thereofto Tenant.  The notice shall contain orbe accompanied by a statement (“**Building Operating CostStatement**”) of the Building Operating Cost during suchcalendar year (prepared by a certified public accountant), and a computation ofBuilding Operating Cost Adjustment. Landlord’s failure to give such notice and Building Operating CostStatement within a reasonable period of time after the end of any calendar yearfor which a Building Operating Cost Adjustment is due shall not release eitherparty from the obligation to make the adjustment provided for inSection 3.07.

**             3.09    ****Tenant’sRight To Audit Building Operating Costs****.**   Provided that (i) no Event of Defaultis then occurring hereunder, nor (ii) is any event occurring which withthe giving of notice or the passage of time, or both, would constitute an Eventof Default hereunder (provided that, in the case of clause (ii) above,such event shall not act to void Tenant’s right to elect to audit as providedbelow unless such event continues to occur after Landlord has provided Tenantwith five (5) days written notice of its existence), Tenant, at its soleexpense, shall have the right, exercisable within ninety (90) days after thereceipt of each Building Operating Cost Statement, to review and audit Landlord’sbooks and records regarding such Building Operating Cost Statement for the solepurpose of determining the accuracy thereof. Such review or audit shall be performed by a nationally recognizedaccounting firm that calculates its fees with respect to hours actually worked(as opposed to a calculation based upon percentage of recoveries or otherincentive arrangement), shall take place during business hours in the office ofLandlord or Landlord’s property manager and shall be completed within sixty (60)days after Tenant’s delivery to Landlord of notice of its election to conductsuch audit.  If Tenant does not soreview or audit Landlord’s books and records, Landlord’s Building OperatingCost Statement shall be final and binding upon Tenant.  In the event that such audit of Landlord’sbooks and records reveals that the amount of Building Operating Cost paid byTenant pursuant to Section 3.06 above, as adjusted pursuant toSection 3.07 above, for the period covered by such Building Operating CostStatement is less than or greater than the actual amount properly payable byTenant under the terms of this Lease, Tenant shall promptly pay any deficiencyto Landlord or, if Landlord concurs with the results of such audit, Landlordshall promptly refund any excess payment to Tenant, as the case may be.  Without limiting the foregoing, in the eventthat such audit reveals an overstatement of Building Operating Cost in excessof five percent (5%) of the total amount of the Building Operating Cost statedby Landlord, Landlord shall reimburse Tenant for the reasonable cost of saidaudit in addition to refunding any excess payment to Tenant as providedabove.  Both Tenant and Tenant’saccounting firm shall keep any information gained from its review of Landlord’sbooks and records confidential and shall not disclose it to any other party,except as required by any Laws.

**ARTICLE 4**

**Landlord Covenants**

**             4.01    ****Landlord’sRepairs and Maintenance****.**  So long as no Event of Default is occurringunder this Lease and subject to any termination of this Lease pursuant toSection 7.06 below or Section 7.07 below, Landlord agrees to repairand maintain (i) the structural portions of the Building, (ii) theexterior wall of the Building, including glass and glazing, (iii) theroof, (iv) the Common Areas, and (v) those portions of the BaseBuilding Systems servicing the Building consisting of the mechanical portion ofthe heating, ventilation and air–conditioning system (but specificallyexcluding any ducts and vents running through and servicing the LeasedPremises), the plumbing pipes extending to the point where such pipes firstenter the Building (but specifically excluding any plumbing located within theBuilding and the fixtures and other plumbing within the bathrooms and kitchenareas of the Leased Premises), the electrical wiring extending to the mainpower panel of the Building (but specifically excluding any electrical wiringand equipment within the Building and any electrical outlets, switches andother equipment within the Leased Premises), the elevators, if any, within theBuilding, and the life safety systems within the Building.  Landlord’s obligation hereunder to repairand maintain is subject to the condition precedent that Landlord shall havereceived written notice of the need for such repairs and maintenance and areasonable time to perform such repair and maintenance.  Tenant shall promptly report in writing toLandlord any defective condition known to it which Landlord is required torepair.
**             4.02     Landlord’sRight To Perform.**  Without limiting any other rights orremedies of Landlord hereunder or at Law, in the event that Tenant fails orrefuses to perform any of Tenant’s obligations hereunder after notice and theexpiration of any applicable cure period, Landlord shall have the right, butnot the obligation to perform such obligations for Tenant’s account, including,without limitation, the right to perform any repair, maintenance or replacementrequired to be performed by Tenant under Section 5.04 below Lease, and theright to pay any amounts due to the providers of any Utilities pursuant toSection 5.02 below.  All costsincurred by Landlord in performing any such obligations for the account ofTenant shall be repaid by Tenant to Landlord upon demand, together with an administrationfee equal to fifteen percent (15%) of such costs.

**             4.03    ****Graphicsand Signage****.**  All signs, notices and graphics of everykind or character, visible in or from public corridors, the Common Area or theexterior of the Leased Premises shall be subject to Landlord’s prior writtenapproval which Landlord shall have the right to withhold in its absolute andsole discretion.  Without limiting theforegoing and subject to Landlord’s prior approval of the plans andspecifications thereof (including, without limitation, the design, location,and size), Tenant shall have the right (“**ExteriorSignage Rights**”) to install one (1) tenantidentification sign at the top of the Building (the “**Sign**”),at Tenant’s sole cost and expense and in accordance with all applicable Laws(as defined in Section 5.09(a)), REAs (as defined in Section 5.12(d))and any other private restrictions imposed against the Property (the“Applicable Requirements”).  Tenantshall erect the Sign in accordance with the plans and specifications approvedby Landlord and all other requirements related to the installation ofAlterations (as provided in Section 5.07 below), and at all timesthereafter, Tenant shall maintain, at its sole cost and expense, the Sign in agood, clean and safe condition and in accordance with the ApplicableRequirements, including all repairs and replacements thereto.  At the earlier to occur of(i) Landlord’s delivery of written notice to remove the Sign following theoccurrence of any Event of Default hereunder, or (ii) upon the terminationor earlier expiration of this Lease, Tenant shall promptly remove the Sign, inwhich event Tenant shall be responsible for and shall repair any damage to theBuilding resulting therefrom.  Tenant’sExterior Signage Rights hereunder are personal to Deltagen, Inc. and may not beassigned or transferred except with the prior written consent of Landlord,which consent may be given or withheld in Landlord’s sole and absolutediscretion.  Tenant shall be responsiblefor obtaining all permits and approvals (governmental and private) necessaryfor the installation and maintenance of the Sign.  Notwithstanding the foregoing, if at any time Deltagen, Inc. nolonger personally occupies (and specifically excluding any area of the LeasedPremises occupied by any sublessee or assignee of Deltagen, Inc.) at leastfifty–one percent (51%) of the square footage of the Building, Tenant’sExterior Signage Rights granted hereunder shall terminate and be of no furtherforce or effect and Tenant shall promptly thereafter remove the Sign, in whichevent Tenant shall be responsible for and shall repair any damage to theBuilding resulting therefrom.  If Tenantfails to remove the Sign as required under this Section 4.03, Landlordshall have the right, at Tenant’s expense, to remove the Sign.  Tenant shall indemnify, defend and protectLandlord and the Landlord Parties and hold Landlord and the Landlord Partiesharmless from and against any and all, proceedings, losses, costs, damages,causes of action, liabilities, injuries or expenses arising out of or relatedto Tenant’s exercise of the Exterior Signage Rights granted hereunder,including, without limitation, any claims of injury to or death of persons ordamage to property occurring or resulting directly or indirectly from theinstallation or maintenance of the Sign on the Building.
**             4.04    ****Peaceful Enjoyment****.**  So long as no Event of Default has occurred,Tenant shall peacefully have, hold and enjoy the Leased Premises, subject tothe other terms hereof.  This covenantand the other covenants of Landlord contained in this Lease shall be bindingupon Landlord and its successors only with respect to breaches occurring duringits and their respective ownership of Landlord’s interest hereunder.

**ARTICLE 5**

**Tenant’s Covenants**

**             5.01    ****PaymentsBy Tenant****.**  Tenant shall pay Rent at the times and inthe manner herein provided.  Allobligations of Tenant hereunder to make payments to Landlord shall constituteRent and failure to pay the same when due shall give rise to the rights andremedies provided for in Section 7.08.

**             5.02    ****Utilities****.**  Tenant shall pay the cost of all water,sewer use, sewer discharge fees and permit costs and sewer connection fees,gas, heat, electricity, refuse pick-up, janitorial service, telephone and othertelecommunications and all materials and services or other utilities(collectively, “Utilities”) applicable to the Leased Premises and/or Tenant,together with all taxes, assessments, charges and penalties added to orincluded within such cost.  Tenant shallarrange to be separately billed by the provider of such Utilities, provided,that to the extent that any such costs, fees and taxes are not separatelybilled to Tenant, Tenant shall pay the amount thereof as invoiced to Tenant byLandlord, within ten (10) days after receipt of an invoice therefor.  Tenant acknowledges that the LeasedPremises, the Building and/or the Project may become subject to the rationingof Utility services or restrictions on Utility use as required by a publicutility company, governmental agency or other similar entity havingjurisdiction thereof.  Tenantacknowledges and agrees that its tenancy and occupancy hereunder shall besubject to such rationing or restrictions as may be imposed upon Landlord,Tenant, the Leased Premises, the Building and/or the Project, and Tenant shallin no event be excused or relieved from any covenant or obligation to be keptor performed by Tenant by reason of any such rationing or restrictions.  Tenant agrees to comply with energyconservation programs implemented by Landlord by reason of rationing,restrictions or Laws.
               Landlord shall not be liable for any loss,injury or damage to property caused by or resulting from any variation,interruption, or failure of Utilities due to any cause whatsoever, or fromfailure to make any repairs or perform any maintenance.  No temporary interruption or failure of suchservices incident to the making of repairs, alterations, improvements, or dueto accident, strike, or conditions or other events shall be deemed an evictionof Tenant or relieve Tenant from any of its obligations hereunder.  In no event shall Landlord be liable toTenant for any damage to the Leased Premises or for any loss, damage or injuryto any property therein or thereon occasioned by bursting, rupture, leakage oroverflow of any plumbing or other pipes (including, without limitation, water,steam, and/or refrigerant lines), sprinklers, tanks, drains, drinking fountainsor washstands, or other similar cause in, above, upon or about the LeasedPremises, the Building, or the Project. Notwithstanding the foregoing, in the event that Tenant is preventedfrom using, and does not use, the Leased Premises or any portion thereof, as aresult of Landlord’s negligence or willful failure to perform the obligationsset forth in clause (v) of Section 4.01 (hereinafter, an “**Abatement Event**”) thenTenant shall give Landlord notice of such Abatement Event, and if suchAbatement Event continues for five (5) consecutive business days afterLandlord’s receipt of any such notice (the “**EligibilityPeriod”**), then the Base Rent shall be abated or reduced, asthe case may be, after expiration of the Eligibility Period for such time thatTenant continues to be so prevented from using, and does not use, the LeasedPremises or a portion thereof, in the proportion that the rentable area of theportion of the Leased Premises that Tenant is prevented from using, and doesnot use, bears to the total rentable area of the Leased Premises; provided,however, that such abatement of Base Rent shall be allowed only to the extentLandlord is reimbursed from the proceeds of rental interruption insurancepurchased, or required to be purchased under Section 7.01 below, byLandlord as part of Building Operating Cost.

**             5.03    ****TaxesOn Personal Property and Alterations****.**  In addition to, and wholly apart from itsobligation to pay Tenant’s Proportionate Share of Building Operating Costs,Tenant shall be responsible for and shall pay prior to delinquency taxes orgovernmental service fees, possessory interest taxes, fees or charges in lieuof any such taxes, capital levies, or other charges imposed upon, levied withrespect to or assessed against its personal property, on the value of itsAlterations, on its interest pursuant to this Lease or on any use made of theLeased Premises or the Common Areas by Tenant in accordance with thisLease.  To the extent that any suchtaxes are not separately assessed or billed to Tenant, Tenant shall pay theamount thereof as invoiced to Tenant by Landlord.

**             5.04    ****Repairs By Tenant****.**  Tenant shall, at all times and at Tenant’ssole cost and expense, maintain and repair the Leased Premises and keep thesame in the same order and condition as received, reasonable wear and tearexcepted.  Tenant shall not do nor shallTenant allow the Tenant Parties to do anything to cause any damage,deterioration or unsightliness to the Leased Premises, the Building or theProject.  Tenant’s obligations hereundershall include, without limitation: (i) the obligation to maintain andrepair and keep the Leased Premises in same order and condition as receivedand, in connection therewith, repair and replace every part thereof, including,without limitation all walls, floors, ceilings, interior glass, windows, windowframes and casements, interior doors and door frames and door closers,fixtures, interior lighting (including, without limitation, light bulbs andballasts), the portions of the Building Systems not otherwise maintained byLandlord pursuant to clause (v) of Section 4.01 above, allcommunications systems serving the Building, signage, equipment, interiorpainting, and any roll-up doors, ramps and dock equipment, including, withoutlimitation, dock bumpers, dock plates, dock seals, dock levelers and docklights located in or about the Building, whatever the scope of the work ofmaintenance or repair required (excepting only those portions of the Buildingor the Project to be maintained by Landlord, as provided in Section 4.01above), (ii) the obligation to furnish all expendables, including lightbulbs, paper goods and soaps, used in the Leased Premises, and (iii) theobligation to repair all damage caused by Tenant or Tenant Parties to anyportion of the Project, whatever the scope of the repair required.  Tenant shall repair all damage caused byremoval of Tenant’s movable equipment or furniture or the removal of anyAlterations permitted or required by Landlord, all as provided inSection 5.18.  Without limiting theforegoing, any work of repair and maintenance performed by or for the accountof Tenant shall be performed by contractors approved by Landlord prior tocommencement of the work and in accordance with procedures Landlord shall fromtime to time establish.  All such workshall be performed in compliance with all applicable laws, ordinances, rulesand regulations and Tenant shall provide to Landlord copies of all permits andrecords of inspection issued or obtained by Tenant in connection therewith toestablish such compliance.
**             5.05    ****Waste****.**  Tenant shall not commit or allow any wasteor damage to be committed in any portion of the Leased Premises.

             **5.06**     **Assignment or Sublease****.**

             (a)         IfTenant intends to assign this Lease or sublet the Leased Premises or any partthereof, Tenant shall give Landlord written notice of such intent.  Tenant’s notice shall set forth the date anysuch assignment or sublease shall commence and be accompanied by an exact copyof the proposed agreements between Tenant and the proposed assignee orsubtenant.  Tenant shall provideLandlord with (i) any additional information or documents reasonablyrequested by Landlord, within ten (10) days after receiving Tenant’snotice, and (ii) an opportunity to meet and interview the proposedassignee or subtenant, if requested by Landlord.

             (b)        Landlordshall then have a period of twenty (20) days following such interview andreceipt of such additional information (or thirty (30) days from the dateof Tenant’s original notice if Landlord does not request additional informationor an interview) (“**Landlord’s Review Period**”)within which to notify Tenant in writing whether Landlord approves ordisapproves of the proposed assignee or sublessee, provided, that Landlord’sapproval shall not be unreasonably withheld so long as:  (i) the use of the Leased Premises bysuch proposed assignee or sublessee would be a Permitted Use; (ii) theproposed assignee or sublessee is of sound financial condition as determined byLandlord; (iii) the proposed assignee’s or sublessee’s use will notinvolve the storage, use, treatment or disposal of any Hazardous Material(except for Permitted Hazardous Materials transported, stored and used inaccordance with the provisions of this Lease); (iv) the proposed use orthe proposed assignee or sublessee would not cause the violation of any covenantor agreement of Landlord to any third party or would permit any other tenant toterminate its lease; and (v) the proposed subtenant or assignee does notthen lease or occupy any other space in the Project, provided that therestriction contained within this item (v) shall only apply where Landlordhas other space within the Project which would generally fit the proposedsubtenant’s/assignee’s requirements and which could otherwise be made availablefor lease by such party.  Failure byLandlord to approve a proposed subtenant or assignee shall not cause atermination of this Lease, and the sole remedy of Tenant shall be an action forinjunctive or declaratory relief.
             (c)         Notwithstanding the provisions ofSection 5.06(b) above, if any sublease or assignment proposed by Tenantinvolves (A) a proposed assignee or sublessee who is not an AffiliatedEntity (as defined below), and (B) either (i) an area of greater thanfifty percent (50%) of the Leased Premises (whether individually, or in theaggregate when taken together with any previously permitted sublease orassignment to the same party), or (ii) a sublet or assignment term oflonger than four (4) years, then in addition to the approval rights granted toLandlord pursuant to Section 5.06(b) above, Landlord shall have the right,exercisable by written notice delivered to Tenant on or before the expirationof Landlord’s Review Period, to elect to terminate this Lease as to the spaceso affected as of the date so specified by Tenant in its notice under Section 5.06(a)above, in which event Tenant will be relieved of all further obligationshereunder as to such space.  For thepurposes hereof, “**A****ffiliated Entity**” shallmean any firm or corporation which is either (x) a wholly owned subsidiaryof the initial tenant hereunder, or (y) an entity which results from themerger or consolidation of the original tenant hereunder with another entity.

             (d)        For thepurposes of this Section 5.06(d), the term “**TransferCosts**” shall mean, with respect to any sublease or assignment,the following costs: (i) reasonable and customary market–based leasingcommissions, (ii) reasonable attorney’s fees, (iii) the reasonablecosts of Alterations which have been approved by Landlord and are required tobe made to the Leased Premises in connection with such sublease or assignmentin order to separately demise the subleased or assigned premises, and(iv) fifty percent (50%) of the undepreciated portion of the reasonablecosts incurred by Tenant in construction and installation of non–buildingstandard heating, ventilation and air conditioning systems (“**Non–Standard HVAC Systems**”)servicing the laboratories, testing rooms or other research facilities, if any,located within the portion of the Leased Premises which is the subject of suchsublease or assignment with such undepreciated portion to be determined bydepreciating such costs incurred in construction and installation of the Non–StandardHVAC Systems on a straight–line basis over the portion of the initialTerm of the Lease remaining following Tenant’s construction of such Non–StandardHVAC Systems; provided, however, that the costs identified as items (i),(ii) and (iii) shall only be included in Transfer Costs if they have beenactually paid directly by Tenant in connection with any such sublease orassignment, and the costs identified as item (iv) shall only be includedin Transfer Costs to the extent (1) that Landlord has approved theinstallation of such Non–Standard HVAC Systems in the same manner asother Alterations hereunder and, at the time of such approval, Landlord andTenant have mutually agreed upon what items constitute such Non–StandardHVAC Systems and, following Tenant’s submission of invoices related to theconstruction and installation of such Non–Standard HVAC Systems, Landlordand Tenant have mutually agreed upon the actual reasonable costs associatedwith the same which are to be the subject of such item (iv); and(2) that such Non–Standard HVAC Systems are installed for thepurpose of servicing laboratories, testing rooms or other research facilities,if any, located within the Leased Premises, as opposed to computer rooms,office areas and/or other non–laboratory areas of the LeasedPremises.  Any rent or otherconsideration realized by Tenant under any such sublease or assignment inexcess of the Rent payable hereunder, after first deducting the applicableamortized portion of any Transfer Costs applicable to such sublease orassignment, shall be divided and paid fifty percent (50%) to Tenant and fiftypercent (50%) to Landlord.  For the purposes of the aforesaidcalculation, Transfer Costs, if any, shall be amortized on a straight–linebasis over the term of such sublease or assignment.  Without limiting the foregoing, in the event that (x) asublease or assignment of all or a portion of the Leased Premises includeslaboratories, testing rooms or other research facilities, and (y) Tenantestablishes to the reasonable satisfaction of Landlord that the sublease orassignment rent obtained under such sublease or assignment exceeds the subleaseor assignment rent which would have been obtained if the subject space weregeneral office space as opposed to laboratories, testing rooms or otherresearch facilities (such aggregate excess rent being referred to herein as the“**Laboratory Excess**”), thenLandlord will permit Tenant to include within the calculation of Transfer Coststhose costs (“**Laboratory Costs**”) incurredby Tenant in construction and installation of any specialized laboratoryimprovements (as opposed to standard building improvements erected withingeneral office space) (herein “**Laboratory Improvements**”),provided that (m) Landlord has previously approved the installation ofsuch Laboratory Improvements in the same manner as other Alterations hereunder,(n) at the time of such approval, Landlord and Tenant mutually agreed uponthe identity of the items that would constitute such Laboratory Improvements,and (o) following Tenant’s submission of invoices related to theconstruction and installation of such Laboratory Improvements, Landlord andTenant mutually agreed upon the actual reasonable Laboratory Costs associatedwith the same.  For the purposes herein,Laboratory Costs shall not include any amounts with respect to Non–StandardHVAC Systems.  Notwithstanding anythingto the contrary herein, Tenant shall not be allowed to include within thecalculation of Transfer Costs any portion of the applicable Laboratory Costswhich exceed the amount of the Laboratory Excess associated therewith afterfirst deducting from such Laboratory Excess the costs set forth initem (iv) above.
             (e)         In any subletting undertaken by Tenant,Tenant shall diligently seek to obtain not less than Fair Market Rent for thespace so sublet.  In any assignment ofthis Lease in whole or in part, Tenant shall seek to obtain from the assigneeconsideration reflecting a value of not less than Fair Market Rent for thespace subject to such assignment. Tenant shall provide to Landlord, upon Landlord’s demand, true andcorrect executed copies of the documents constituting such sublease orassignment and any amendments thereof during the Term.

             (f)         No assignment or subletting by Tenantshall relieve Tenant of any obligation under this Lease.  Any assignment or subletting that conflictswith the provisions hereof shall be void. No consent by Landlord to any subletting or assignment shall constitutea consent to any other assignment or subletting nor shall it constitute awaiver of any of the provisions of this Section 5.06 as they apply to anysuch future sublettings or assignments.

             (g)        Any assignee shall assume in writing,for the express benefit of Landlord, all of the obligations of Tenant underthis Lease, provided that no such assumption shall be deemed a novation orother release of the prior Tenant. Following any assignment, the obligations for which the prior Tenantremains liable under this Lease shall include, without limitation, anyobligations arising in connection with any amendments to this Lease executed byLandlord and the assignee, whether or not such amendments are made withknowledge or consent of the prior Tenant.
             (h)        Tenant shall not market or otherwiseoffer space within the Leased Premises for sublease or assignment, nor shallTenant enter into any subletting or assignment of this Lease until after theTerm Commencement Date has occurred.

             (i)          Any improvements, additions, oralterations to the Building or the Project that are required by any law,ordinance, rule or regulation, or are deemed necessary or appropriate byLandlord as a result of any subletting or assignment hereunder, shall beinstalled and provided without cost or expense to Landlord.  Landlord may condition its consent to anyproposed sublessee or assignee on the construction of improvements reasonablydeemed necessary or appropriate by Landlord in order to separately demise thesubleased or assigned premises.

             (j)          Landlord may hire outside consultantsto review all assignment and subletting documents and information.  Tenant shall reimburse Landlord for the costthereof, including reasonable attorneys’ fees, on demand.

             (k)         Without liability to Tenant, Landlordshall have the right to offer and to lease space in the Building, or in anyother property, to any party, including, without limitation, parties with whomTenant is negotiating, or with whom Tenant desires to negotiate, concerningassignment or subletting the Leased Premises, or any portion thereof.

             **5.07**     **Alterations, Additionsor Improvements****.**

             (a)          Tenant shall not make or allow to be made anyalterations, additions or improvements in or to the Leased Premises(collectively, “**Alterations**”) withoutobtaining the prior written consent of Landlord.  Landlord’s consent shall not be unreasonably withheld withrespect to proposed Alterations that (i) comply with all applicable laws,ordinances, rules and regulations, (ii) are compatible with the Buildingand the Building Systems, (iii) will not interfere with the use andoccupancy of any other portion of the Building or the Project by any othertenant or their invitees, (iv) do not affect the structural portions ofthe Building, (v) do not and will not, whether alone or taken togetherwith other improvements, constitute a violation of the Permitted Use of theLeased Premises, (vi) do not and will not, involve the demolition ofcurrent office improvements within the Building for the purpose of installationof any warehouse space or any laboratories, testing rooms or other researchfacilities, and (vii) do not and will not, whether alone or taken togetherwith other improvements, require the construction of any other improvements oralterations within the Building or the Project.  With respect to all other proposed Alterations, Landlord maywithhold its consent in Landlord’s sole and absolute discretion, provided, thatwith respect to any Alterations which involve the construction and installationof any laboratories, testing rooms or other research facilities, Landlord willnot withhold its consent so long as (x) Tenant’s demonstrated then currentNet Cash Position (as such term is defined within Section 5.14(b) below)at the time of Tenant’s request for consent to such Alterations is equal to orgreater than Thirty Million Dollars ($30,000,000.00), (y) Tenant deliversthe applicable Supplemental Credit (as defined within and within the timeperiod required by Section 5.14(d) below), and (z) if requested byLandlord pursuant to Section 5.18 below, Tenant shall, as a part of therestoration obligations set forth in Section 5.18 below, remove suchlaboratories, testing rooms or other research facilities at the expiration orsooner termination of this Lease and restore the affected portions of theLeased Premises to the condition required within said Section 5.18below.  In determining whether or not toconsent to proposed Alterations, Landlord shall have the right (withoutlimitation) to review plans and specifications for proposed Alterations,construction means and methods, the identity of any contractor or subcontractorto be employed on the work of Alterations, and the time for performance of suchwork.  In addition, Landlord shall havethe right to approve, which approval shall not be unreasonably withheld,Tenant’s engineers, architects and contractors who will be engaged in connectionwith Tenant’s construction and installation of any Alterations approved byLandlord.  Tenant shall supply toLandlord any documents and information requested by Landlord in connection withthe exercise of its rights hereunder. Landlord may hire outside consultants to review such documents andinformation and Tenant shall reimburse Landlord for the cost thereof, includingreasonable attorneys’ fees, upon demand. All Alterations permitted hereunder shall be made and performed byTenant without cost or expense to Landlord. Tenant shall pay Landlord, upon completion of any Alteration, areasonable fee for Landlord’s supervision and administration of theinstallation thereof; provided, however, that such fee shall not be deemed tobe “**income**” for purposes ofcalculating management cost recovery under Section 3.05(a)(vii).  The obligations of the parties with respectto removal of Alterations shall be controlled by Section 5.18.  Without limiting the foregoing, beforeAlterations may begin, Tenant shall provide Landlord with copies of validbuilding permits or other permits or licenses required for the construction ofsuch Alterations and Tenant shall, at Tenant’s sole cost and expense, duringthe course of construction of any Alterations, maintain builders’ riskinsurance for the amount of the completed value of the Alterations on anall-risk non-reporting form covering all improvements under construction,including building materials, and such other insurance in amounts and againstsuch risks as Landlord shall reasonably require in connection with theAlterations, including, without limitation, naming Landlord and Mortgage Lender(as defined in Section 5.12 below) as loss payee under any such policy orpolicies.  In addition to and withoutlimitation on the generality of the foregoing, Tenant shall ensure that itscontractor(s) procure and maintain in full force and effect, during the courseof construction of such Alterations, a “broad form” commercial generalliability and property damage policy of insurance naming Landlord, Tenant andMortgage Lender as additional insureds. Such insurance shall have policy limits approved by Landlord, from timeto time with reference to the scope of the Alterations to be performed, but inno event less than Three Million Dollars ($3,000,000.00) combined single limitfor bodily injury or property damage in any one accident or occurrence, andshall contain a severability of interest clause or a cross liabilityendorsement.
             (b)         Subject to Landlord’s prior written approval ofthe plans and specifications therefor (including, without limitation, thelocation, size, and color of the equipment and all associated cabling andwiring to be installed by Tenant throughout the Building, including anypenetrations of the roof membrane of the Building), during the Term, Tenantmay, at its sole cost and expense, construct and maintain up to three (3)antennas on the roof of the Building together with related cabling andequipment (the “**Antenna Equipment**”).  Notwithstanding the foregoing, thelocation(s) of any penetration of the roof membrane of the Building shall bedetermined by Landlord in its sole and absolute discretion.  For the purposes herein, it shall bereasonable for Landlord to withhold its approval of the installation of any suchAntenna Equipment which (i) will, in Landlord’s reasonable judgment,damage or impair the structural integrity of the Building (including the roof),(ii) will result in an unsafe condition affecting Landlord’s employees orcontractors authorized to have access to the roof, or (iii) will interferewith any then existing equipment of Landlord located on the roof, or interferewith any then existing equipment or services of any third party, including anyother tenant at the Project.  Uponreceipt of Landlord’s prior written approval of the plans and specifications asset forth herein, Tenant shall erect the Antenna Equipment in accordance withthe approved plans and specifications, in a good and workmanlike manner, inaccordance with the requirements for all other Alterations set forth in Section 5.07(a)above, and in a manner so as not to interfere with the use of the Project byany other tenant or occupant.  Tenantshall at all times operate and maintain the Antenna Equipment in a good, cleanand safe condition, in accordance with all Laws (as defined inSection 5.09(a) below) and in a manner so as not to interfere with the useof the Project by any other tenant or occupant.  Tenant shall provide Landlord with reasonable advance writtennotice prior to entering upon the roof of the Building so that Landlord may, ifit so desires, have a representative accompany Tenant onto the roof.  Upon the expiration or sooner termination ofthis Lease or Tenant’s right to possession of the Leased Premises, Tenantshall, at Tenant’s sole cost and expense, promptly remove the AntennaEquipment, including, without limitation, all associated wiring and cablingthroughout the Building, and repair any damage to the Building resultingtherefrom.  If Tenant fails to removethe Antenna Equipment on or before the expiration or sooner termination of thisLease or Tenant’s right to possession of the Leased Premises, Landlord may, atTenant’s expense, remove the Antenna Equipment and perform the relatedrestoration and repair work, and use, dispose of or take such other actionswith respect to the Antenna Equipment as Landlord may deem appropriate, allwithout compensation or payment to Tenant. Tenant shall indemnify, defend, protect and hold harmless Landlord andthe Landlord Parties from all Claims (as defined in Section 5.17 below)arising from or in any way directly or indirectly relating to the construction,installation, maintenance, use, operation or removal of the Antenna Equipment.

**             5.08    ****Liens****.**  Tenant shall keep the Leased Premises andthe Project free from any liens arising out of any (i) work performed ormaterial furnished to or for the Leased Premises, and (ii) obligationsincurred by or for Tenant or any person claiming through or under Tenant.  Tenant shall, within ten (10) businessdays following the imposition of any such lien, cause such lien to be releasedof record by payment or posting of a bond fully satisfactory to Landlord inform and substance.  Landlord shall havethe right at all times to post and keep posted on the Leased Premises anynotices permitted or required by law, or that Landlord shall deem proper forthe protection of Landlord, the Leased Premises, the Project and any otherparty having an interest therein, from mechanics’, materialmen’s and otherliens.  If Tenant fails in itsobligations to cause any such lien to be released of record within saidten (10) business day period, Landlord may cause such liens to be releasedby any means it deems proper, including, without limitation, payment of anysuch lien, at Tenant’s sole cost and expense.  All costs and expenses incurred by Landlord in causing such liensto be released shall be repaid by Tenant to Landlord immediately upon demand,together with an administration fee equal to twenty percent (20%) of such costsand expenses.  In addition to all otherrequirements contained in this Lease, Tenant shall give to Landlord at leastfifteen (15) business days’ prior written notice before commencement ofany construction on the Leased Premises.

             **5.09**     **ComplianceWith Laws, Insurance Standards and Non-Discrimination****.**

             (a)         Tenantshall comply with all Laws, now or hereafter in force, as amended from time totime, in any way related to the use, condition or occupancy of the LeasedPremises, regardless of when they become effective, including, without limitation,all applicable Hazardous Materials Laws, the Americans with Disabilities Act of1990, as amended; provided however, that Tenant shall not be required to makeor, except as provided in Section 3.05 above, pay for any capitalimprovements or structural changes to the Leased Premises or the Building notrelated to Tenant’s specific use of the Leased Premises unless the requirementfor any such capital improvements or structural changes is imposed as a resultof any Alterations made or proposed to be made at Tenant’s request.  Tenant shall immediately deliver to Landlorda copy of any notices received from any governmental agency in connection withthe Leased Premises.  It is theintention of Tenant and Landlord that the obligations of Tenant under this Section 5.09shall apply irrespective of the scope of work required to achieve suchcompliance.  Tenant shall promptly cureand satisfy all Hazardous Materials Claims arising out of or by reason of theactivities or businesses of Tenant, its sub-tenants, or Tenant Parties or anyemployees, agents, contractors, officers, directors, partners, licensees,invitees and guests of Tenant’s sub-tenant. Nothing done by Tenant in its use or occupancy of the Leased Premisesshall create, require or cause imposition of any requirement by anygovernmental authority for structural or other upgrading of or improvement tothe Project.
             (b)        Tenant shall not occupy or use, orpermit any portion of the Leased Premises to be occupied or used, for anybusiness or purpose that is disreputable or productive of fire hazard, orpermit anything to be done that would increase the rate of fire or otherinsurance coverage on the Project and/or its contents.  If Tenant does or permits anything to bedone that shall increase the cost of any insurance policy required to becarried hereunder, then Tenant, at Landlord’s option, shall not be in defaultunder this Lease, but shall reimburse Landlord, upon demand, for any suchadditional premiums.  Landlord shalldeliver to Tenant a written statement setting forth the amount of any suchinsurance cost increase and showing in reasonable detail the manner in which ithas been computed.

             (c)         Tenant herein covenants by and forhimself or herself, his or her heirs, executors, administrators and assigns,and all persons claiming under or through him or her, and this Lease is madeand accepted upon and subject to the following conditions:  That there shall be no discriminationagainst, or segregation of, any person or group of persons on account of race,color, creed, religion, sex, marital status, sexual orientation, nationalorigin or ancestry in the leasing, subleasing, transferring, use, occupancy,tenure or enjoyment of the Leased Premises herein leased, nor shall Tenant, orany person claiming under or through him or her, establish or permit any suchpractice or practices of discrimination or segregation with reference to theselection, location, number, use or occupancy of tenants, lessees, subtenants,sublessees or vendees in the Leased Premises herein leased.

**             5.10    ****EntryFor Repairs, Inspection, Posting Notices, Etc****.**  After reasonable notice (except inemergencies where no such notice shall be required), Landlord or LandlordParties shall have the right to enter the Leased Premises to inspect the same,to clean, to perform such work as may be permitted or required hereunder, tomake repairs to the Building or other areas of the Project or to makealterations of the Project (with the exception of alterations to the interiorareas of the Building), to deal with emergencies, to post such notices as maybe permitted or required by law to prevent the perfection of liens againstLandlord’s interest in the Project or to exhibit the Leased Premises toprospective tenants, purchasers, encumbrancers or others, or for any otherpurpose as Landlord may deem necessary or desirable; provided, however, that inexercising any such right of entry Landlord shall not unreasonably interferewith Tenant’s business operations.  Tenantshall not be entitled to any abatement of Rent by reason of the exercise of anysuch right of entry or about the Project.
**             5.11    ****No Nuisance****.**  Tenant shall conduct its business andcontrol Tenant Parties without creating any nuisance, or interfering with,annoying, endangering or disturbing any other tenant or Landlord in itsoperation of the Project.  Tenant shallnot place any loads upon the floor, walls or ceiling of the Leased Premisesthat endanger the structure nor place any harmful liquids or Hazardous Materialin the drainage system of the Building. Tenant shall not permit any vibration, noise or odor to escape from theLeased Premises and shall not do or permit anything to be done within theLeased Premises which would adversely affect the quality of the air in theBuilding or about the Project.  Tenantshall promptly provide Landlord with copies of all permits issued to Tenant bythe Bay Area Air Quality Management District (the “**AirManagement District**”) and any other governmental agencyresponsible for or having jurisdiction over matters related to air quality,together with copies of all correspondence between Tenant and the AirManagement District or such other agencies. Tenant acknowledges that the Project is afirst-class office and research and development campus and that “objectionableodors” is a subjective standard. Accordingly, Tenant agrees that, if Landlord in its sole and absolutediscretion determines that odors emanating from the Premises are leading tochronic complaints from other tenants and occupants of the Project, Tenantshall promptly use its best efforts to correct the situation, at Tenant’s solecost and expense, to Landlord’s satisfaction. Such measures to be taken by Tenant shall include, without limitation,the hiring of special consultants and the making of capital improvements to theLeased Premises, including, without limitation, the replacing or upgrading ofequipment.  Without limiting theprovisions of Section 5.07(a) above, in the event that Landlord approvesthe installation and construction of any laboratories, or testing rooms orother research facilities within the Leased Premises, then as a component ofany Alterations made by Tenant to the Leased Premises, Tenant shall installfume hoods, as well as a rooftop venting and exhaust system designed toincrease the velocity of exhaust such that any odors shall be discharged highinto the atmosphere in order to minimize the risk of odors detectable at groundlevel.  In addition, Tenant shallinstall and utilize such additional venting, exhaust and quenching systems,including, without limitation, base quenching, distillation units, acidquenching, and mechanical exhaust/filtration systems, as appropriate to reducethe risk of emanation of such odors in or about the Project.  In all events, and irrespective of whetheror not Landlord has received chronic complaints from other tenants or occupantsof the Project, Tenant shall strictly comply with the measures set forth inthis Section 5.11 and any additional measures reasonably required byLandlord from time to time to eliminate the emanation of objectionable odorsfrom the Leased Premises.  Withoutlimiting any other rights or remedies of Landlord under this Lease, Landlordreserves the right, after providing Tenant notice of and a reasonableopportunity to cure any problems relating to odors, to take such actions asLandlord deems necessary in its sole and absolute discretion to eliminate anysuch odors emanating from the Leased Premises. Tenant shall promptly reimburse Landlord upon demand for all costs incurredby Landlord in enforcing its rights under this Section 5.11.
             **5.12**     **Subordination;Mortgagee Protection; Reciprocal Easement Agreements****.**

             (a)         Tenant agrees that, upon Tenant’sreceipt of a subordination, non–disturbance and attornment agreement, thisLease and the rights of Tenant hereunder are subject and subordinate to theholder of or beneficiary under any mortgage or deed of trust whether now or inthe future encumbering the Project (the “**MortgageLender**”) and to any and all advances made thereunder, andinterest thereon, and all modifications, renewals, supplements, consolidationsand replacements thereof.  Tenantagrees, however, that the Mortgage Lender may at its option, unilaterally electto subordinate, in whole or in part, by an instrument in form and substancesatisfactory to such Lender, the lien of such mortgage or deed of trust to thisLease.  In such case, Tenant agrees toexecute promptly and to deliver to Landlord or such Mortgage Lender any suchsubordination instrument or instruments requested by such Lender and agreesthat if it fails or refuses to do so within fifteen (15) days afterwritten request therefor by Landlord or such Mortgage Lender, such failure orrefusal shall constitute a default by Tenant under this Lease, but such failureor refusal shall in no way affect the validity or enforceability of any suchsubordination made by such Mortgage Lender.

             (b)        Any successor in interest to anyMortgage Lender shall not be bound by (i) any payment of Gross Rent formore than one (1) month in advance, or (ii) any amendment ormodification of this Lease made without the written consent of the MortgageLender.  Nothing herein contained shallbe deemed to impose upon the person or party succeeding to the interest ofLandlord as a result of the enforcement of such mortgage or first deed of trustby any Mortgage Lender, any obligation for defaults on the part of Landlord,and any person or party succeeding to possession of the Project as a successorto Landlord shall be subject to Landlord’s obligations hereunder only duringthe period of such persons’ or party’s ownership.

             (c)         Tenant shall not sue, seek any remedyor enforce any right against Landlord until (a) Tenant gives writtennotice to any Mortgage Lender and (b)  if Landlord shall have failed tocure the default which would otherwise be the subject of such matter within thetime period provided for in this Lease, then the Mortgage Lender shall have anadditional forty–five (45) days after the expiration of such timeperiod, or after receipt of such notice from Tenant (whichever shall lastoccur) within which to cure such default or if such default cannot be curedwithin that time, then such additional time as may be necessary if within suchforty–five (45) days, any Mortgage Lender has commenced and isdiligently pursuing the remedies necessary to cure such default, in which eventthis Lease shall not be terminated, provided, that it is agreed that theMortgage Lender shall have no obligation to Tenant to cure or remedy any act oromission of Landlord.

             (d)        Tenantagrees that this Lease and the rights of Tenant hereunder are subject andsubordinate to any easements, reciprocal easement agreements, rights of way,covenants, conditions and restrictions or similar property interests, whethernow or in the future affecting the Project (collectively, the “**REAs**”); provided, however,that any future REAs shall not materially adversely affect any specific rightsgranted to Tenant hereunder.  Landlordrepresents to Tenant that Landlord has not personally created any REAsencumbering or otherwise affecting the Project as of the date of Landlord’sexecution of this Lease.  Tenant agreesto execute promptly and to deliver to Landlord any subordination instrument orinstruments requested by Landlord and agrees that if it fails or refuses to doso within fifteen (15) days after written request therefor by Landlord,such failure or refusal shall constitute a default by Tenant under this Lease,but such failure or refusal shall in no way affect the validity orenforceability of any such subordination.
**             5.13    ****Estoppel Certificate****.**  Within ten (10) days of a writtenrequest from the other party, Landlord or Tenant, as applicable, shall executeestoppel certificates addressed to (i) in the case of a request byLandlord, Landlord and (1) any mortgagee or prospective mortgagee ofLandlord, or (2) any purchaser or prospective purchaser of all or anyportion of, or interest in, the Project, on a form specified by Landlord,certifying as to such facts (if true) and agreeing to such notice provisionsand other matters as such mortgagee(s) or purchaser(s) may reasonably require,and (ii) in the case of a request by Tenant, (1) a prospective lenderor other financier of Tenant, or (2) a prospective sublessee or assigneewho has been approved by Landlord in accordance with Section 5.06 above;provided, however, that in no event shall any such estoppel certificate requirean amendment of the provisions hereof, although the party delivering suchestoppel certificate shall be bound by the statements made in suchcertificate.  In the event that Landlordor Tenant, as applicable fails or refuses to deliver such an estoppelcertificate to the requesting party within ten (10) days of a writtenrequest from such requesting party, then the requesting party may give toLandlord or Tenant, as applicable, a second notice, reiterating the requestthat Landlord or Tenant, as applicable, execute an estoppel certificate andstating that, if Landlord or Tenant, as applicable, fails to do so withinfive (5) days of the receipt of such second notice from the requestingparty, that Landlord or Tenant, as applicable, shall be deemed to be bound bythe statements set forth in the form of certificate which the requesting partydelivered to Landlord or Tenant, as applicable.  In the event that Landlord or Tenant, as applicable, fails todeliver an estoppel certificate in the form specified by the requesting partywithin five (5) days of the receipt by Landlord or Tenant, as applicable,of such second notice from the requesting party, Landlord or Tenant, asapplicable, shall conclusively be deemed, without exception, to haveacknowledged the correctness of the statements set forth in the form ofcertificate which the requesting party delivered, and Landlord or Tenant, asapplicable, shall be estopped from denying the correctness of each suchstatement, such that the requesting party together with the applicable partieson behalf of which such requesting party may request such estoppel certificate,as referenced above, may rely on the correctness of the statements in such formof certificate, as if made and certified by Landlord or Tenant, asapplicable.  A failure by Tenant todeliver an estoppel certificate in the form specified by Landlord within fifteen (15)days of the receipt by Tenant of an initial request from Landlord for suchcertificate shall also constitute a material breach of this Lease by Tenant.
             **5.14    ****Letterof Credit****.**

             (a)          Upon execution of this Lease, Tenant shalldeliver to Landlord, by wire transfer of immediately available funds, cash inthe amount of One Million Seven Hundred One Thousand Four Hundred Eighty–OneDollars ($1,701,481.00) (hereinafter, the “**CashEquivalent**”), as security for Tenant’s performance of all ofTenant’s covenants and obligations under this Lease.  Within fifteen (15) business days after the execution ofthis Lease, Tenant shall, at Tenant’s sole cost and expense, deliver toLandlord the Letter of Credit described below in an amount equal to the “**LC Face Amount**” (asdefined below) then required to be maintained hereunder, as a substitution forand replacement of the Cash Equivalent, which Letter of Credit will thereafterbe held as security for Tenant’s performance of all of Tenant’s covenants andobligations under this Lease.  Tenantshall deliver the original Letter of Credit to Hines, 101 CaliforniaStreet, Suite 1000, San Francisco, California 94111, Attn:  Lisa Burke Lewis, and shall provide a copythereof to Morrison & Foerster LLP, 425 Market Street, 32ndFloor, San Francisco, California 94105, Attn: Stephan C. Wagner.  For the purposes herein, the “**LC Face Amount**” shallmean the aggregate total of (v) the amount set forth in the Basic LeaseInformation, plus (w) the aggregate amount of all Supplemental Credits (asdefined below), if any, plus (x) the aggregate amount of all FirstOpportunity Credits (as defined below), if any, plus (y) the aggregateamount of the Heartport Lease Termination Credit (as defined inSection 7.34(a) below), if any, plus (z) the aggregate amount of theHeartport Expansion Option Credit (as defined in Section 7.34(b)below).  Within five (5) businessdays after Landlord’s receipt and written approval of the original Letter Credittogether with Tenant’s written wiring instructions for return of the CashEquivalent and written notification (which notification must be given to all ofthe parties specified above in this Section 5.14(a)), Landlord shallreturn to Tenant the Cash Equivalent; provided that, if Landlord fails to soreturn the Cash Equivalent to Tenant then such Cash Equivalent shall accrueinterest at a rate equal to ten (10%) annually for each day that Landlordfails to so return such Cash Equivalent and Tenant may off–set the amountof such Cash Equivalent plus any applicable interest against the Gross Rentcoming due from and after the second month of the initial Term.  Notwithstanding the foregoing, neither theLetter of Credit nor any Letter of Credit Proceeds (as defined below) shall bedeemed an advance rent deposit or an advance payment of any other kind, or ameasure of Landlord’s damages upon Tenant’s default.  The Letter of Credit shall be maintained in effect from theEffective Date through the date that is forty-five (45) days after theExpiration Date (the “**LC Termination Date**”).  On the LC Termination Date, Landlordshall return to Tenant the Letter of Credit and any Letter of Credit Proceedsthen held by Landlord (other than those Letter of Credit Proceeds Landlord isentitled to retain under the terms of this Section 5.14(a)); provided,however, that in no event shall any such return be construed as an admission byLandlord that Tenant has performed all of its obligations hereunder.  Landlord shall not be required to segregatethe Letter of Credit Proceeds from its other funds and no interest shall accrueor be payable to Tenant with respect thereto. Landlord may (but shall not be required to) draw upon the Letter ofCredit and use the proceeds therefrom (the “**Letterof Credit Proceeds**”) or any portion thereof (i) to cureany default under this Lease and to compensate Landlord for any loss or damageLandlord incurs as a result of such default, (ii) to repair damage to theLeased Premises caused by Tenant, (iii) to clean the Leased Premises upontermination of this Lease, and (iv) to reimburse Landlord for the paymentof any amount which Landlord may spend or be required to spend by reason ofTenant’s default, it being understood that any use of the Letter of CreditProceeds shall not constitute a bar or defense to any of Landlord’s remediesset forth in Section 7.08(b) below. In such event and upon written notice from Landlord to Tenant specifyingthe amount of the Letter of Credit Proceeds so utilized by Landlord and theparticular purpose for which such amount was applied, Tenant shall immediatelydeliver to Landlord an amendment to the Letter of Credit or a replacementLetter of Credit in an amount equal to the full LC Face Amount.  Tenant’s failure to deliver such replacementLetter of Credit to Landlord within ten (10) business days of Landlord’snotice shall constitute an Event of Default hereunder.  In the event Landlord transfers its interestin this Lease, Landlord shall transfer the Letter of Credit and any Letter ofCredit Proceeds then held by Landlord to Landlord’s successor in interest andLandlord or the transferee shall provide written notice of such transfer toTenant and the Bank, and thereafter Landlord shall have no further liability toTenant with respect to such Letter of Credit or Letter of Credit Proceeds.
             (b)        Tenantshall have the right to make a one time request for Landlord’s consent, whichconsent shall not be withheld except as specifically provided below, to a onetime reduction of the then current LC Face Amount by the amount ofFive Hundred Sixty–Seven Thousand One Hundred Sixty And 50/100thsDollars ($567,160.50), which request may be submitted at any time after theJuly 1, 2003, but which reduction shall not take place before the secondanniversary of the Term Commencement Date. Notwithstanding theforegoing, Landlord may withhold its consent to such reduction only if(i) (x) an Event of Default is occurring under this Lease, or(y) there is then occurring any event which with the giving of notice orthe passage of time, or both, would constitute an Event of Default hereunder,either at the time of Tenant’s submission of such request for reduction of theLC Face Amount or the time that such reduction is to take place (providedthat, in the case of clause (y) above, such event shall not act to voidTenant’s right to request Landlord’s consent to such one time reduction of thethen current LC Face Amount unless such event continues to occur afterLandlord has provided Tenant with five (5) days written notice of itsexistence), or (ii) Tenant’s demonstrated Net Cash Position (as definedbelow) at the time of such request is less than Sixty–Five MillionDollars ($65,000,000.00) as shown by evidence delivered by Tenant to Landlordon or promptly after the date of Tenant’s delivery of such request forconsent.  For the purposes of thisLease, Tenant’s “**Net Cash Position**” shallmean (x) the aggregate amount of the following items:  (1) cash on hand; (2) dollardemand deposits maintained in the United States with any commercial bank anddollar time deposits maintained in the United States with, or certificates ofdeposit having a maturity of one year or less issued by, any commercial bank orother financial institution acceptable to the Landlord; (3) directobligations of, or unconditionally guaranteed by, the United States and havinga maturity of one year or less; and (4) readily marketable commercialpaper having a maturity of one year or less, issued by any corporationorganized and existing under the laws of the United States or any state thereofor the District of Columbia and rated by Standard & Poor’s or Moody’s(or, if neither such organization shall rate such commercial paper at any time,rated by any nationally recognized rating organization in the United States)with the highest rating assigned by such organization, less (y) theaggregate amount of Tenant’s then known and reasonably anticipated liabilitieswhich will either become due or be reasonably anticipated to become due duringthe twelve (12) month period immediately following the date of Tenant’s requestfor reduction of the LC Face Amount, including, without limitation theaggregate amount of all principal and interest payments due under any loanobligations of Tenant during such twelve (12) month period.

             (c)         As usedherein, Letter of Credit shall mean an unconditional, standby irrevocableletter of credit (herein referred to as the “**Letterof Credit**”) issued by Wells Fargo Bank, N.A. or theSan Francisco office of a major national bank insured by the FederalDeposit Insurance Corporation, with assets of not less than Fifty BillionDollars ($50,000,000,000.00) and otherwise satisfactory to Landlord(collectively, the “**Bank**”),naming Landlord as beneficiary, in the amount of the LC Face Amount, andotherwise in form and substance satisfactory to Landlord.  The Letter of Credit shall be for a minimumone–year term and shall provide: (i) that Landlord may make partial and multiple draws thereunder,up to the face amount thereof; (ii) that Landlord may draw upon the Letterof Credit up to the full amount thereof and the Bank will pay to Landlord theamount of such draw upon receipt by the Bank of a sight draft signed byLandlord and accompanied by a written certification from Landlord to the Bankstating either that:  (A) a defaulthas occurred and is continuing under this Lease and any applicable grace periodhas expired or Landlord is otherwise entitled to draw on the Letter of Creditunder the terms of the Lease, or (B) Landlord has not received notice fromthe Bank at least thirty (30) days prior to the then current expiry dateof the Letter of Credit that the Letter of Credit has been renewed by the Bankfor at least one (1) year beyond the relevant annual expiration date or,in the case of the last year of the Term, forty-five (45) days after theExpiration Date, together with a replacement Letter of Credit or a modificationto the existing Letter of Credit effectuating such renewal, and Tenant has nototherwise furnished Landlord with a replacement Letter of Credit as hereinafterprovided; (iii) that the beneficial interest under the Letter of Creditshall be freely transferable one or more times and, therefore, in the event ofthe assignment or other transfer of the interest of Landlord (or any successorLandlord) under this Lease, the Letter of Credit shall be freely transferableby Landlord (or such successor), without recourse and without the payment ofany fee or consideration by Landlord, such assignee or transferee, or anyfuture assignees or transferees, to the assignee or transferee of such interestand the Bank shall confirm the same to Landlord (or such successor) and suchassignee or transferee; and (iv) in the event that a fee or otherconsideration is payable by Tenant in connection with the transfers referencedin item (iii) above, the payment of such fee shall not be a conditionprecedent to the effectiveness of any such transfer or any future draws uponsuch Letter of Credit, and the Bank shall confirm the same to Landlord (or suchsuccessor) and such assignee or transferee. In the event that the Bank shall fail to (y) notify Landlord thatthe Letter of Credit will be renewed for at least one (1) year beyond thethen applicable expiration date (or, in the case of the last year of the Term,forty-five (45) days after the Expiration Date), and (z) deliver toLandlord a replacement Letter of Credit or a modification to the existingLetter of Credit effectuating such renewal, and Tenant shall not have otherwisedelivered to Landlord, at least thirty (30) days prior to the relevantannual expiration date, a replacement Letter of Credit in the amount requiredhereunder and otherwise meeting the requirements set forth above, then Landlordshall be entitled to draw on the Letter of Credit as provided above, and shallhold the proceeds of such draw as Letter of Credit Proceeds pursuant toSection 5.14(a) above until Tenant delivers to Landlord an acceptablereplacement Letter of Credit satisfying the requirements of thisSection 5.14.
             (d)        Notwithstandinganything to the contrary contained in this Lease, if at any time after the dateof this Lease Landlord approves the construction by Tenant of any Alterationscomprising laboratories, testing rooms or other research facilities, then priorto commencement of construction of such Alterations Tenant shall deliver toLandlord an amendment to the Letter of Credit increasing the then-currentLC Face Amount by an amount equal to the product of the applicable “**Multiplier**” (as definedbelow) multiplied by the number of square feet of such laboratories, testingrooms or other research facilities to which Landlord consents and Tenantconstructs in accordance with Section 5.07 above (each such increase beingherein referred to as a “**Supplemental Credit**”and all such credits being referred to herein collectively as the “**Supplemental Credits**”).  (The amount of each Supplemental Credit willinitially be determined in accordance with the Multiplier in effect on the datethat Tenant is first obligated to deliver an amendment to the Letter of Creditin relation to such Supplemental Credit.) Notwithstanding the foregoing, upon each renewal of the Letter of Creditin accordance with Section 5.14(c), the amount of any SupplementalCredits, if any, then included within the LC Face Amount shall be recalculatedin accordance with the Multiplier which is in effect on the date of suchrenewal.  For the purposes herein, theterm “**Multiplier**” shall mean(i) with respect to months 1 through 34 of this Lease, the amount of FiftyDollars ($50.00); (ii) with respect to months 35 through 46 of this Lease,the amount of Forty–Four Dollars ($44.00); (iii) with respect tomonths 47 through 58 of this Lease, the amount of Thirty–Eight Dollars($38.00); (iv) with respect to months 59 through 70 of this Lease, theamount of Thirty–Two Dollars ($32.00); (v) with respect to months 71through 82 of this Lease, the amount of Twenty–Six Dollars ($26.00); and(vi) with respect to months 83 through the Term Expiration Date, theamount of Twenty Dollars ($20.00).
             (e)         Notwithstandinganything to the contrary contained in this Lease, if at any time after the dateof this Lease Tenant accepts any First Opportunity Space, pursuant toSection 7.33 below, then within ten (10) business days after the exerciseof the Right of First Opportunity applicable to such First Opportunity Space,Tenant shall deliver to Landlord an amendment to the Letter of Creditincreasing the then-current LC Face Amount by an amount equal tonine (9) months Base Rent applicable to such First Opportunity Space or,if the conditions precedent to Tenant’s reduction of the LC Face Amount,in accordance with Section 5.14(b) above have been satisfied, six (6)months Base Rent applicable to such First Opportunity Space (each increasebeing herein referred to as a “**First Opportunity Credit**”and all such credits being referred to herein collectively as the “**First Opportunity Credits**”).

**             5.15    ****Tenant’sRemedies****.**  Tenant shall look solely to Landlord’sinterest in the Building for recovery of any judgment from Landlord, provided,that such interest in the Building shall be deemed to be an amount which isequal to the lesser of (a) the interest in the Building of the thencurrent Landlord, or (b) the equity interest Landlord would have in theBuilding if the Building were encumbered by third party debt in an amount equalto eighty percent (80%) of the fair market value of the Building, provided thatin no event shall such liability extend to any sales or insurance proceedsreceived by Landlord or the Landlord Parties in connection with the Project,the Building or the Leased Premises. Landlord and Landlord Parties shall not be personally liable for anysuch judgment.  Any lien obtained toenforce any such judgment and any levy of execution thereon shall be subjectand subordinate to any lien, mortgage or deed of trust to whichSection 5.12 applies or may apply.

**             5.16    ****Rules and Regulations****.**  Tenant shall comply with the Rules andRegulations for the Project attached as ***Exhibit B***and suchamendments thereto as Landlord may adopt from time to time with prior notice toTenant; provided, however, that Landlord shall not enforce or amend such Rulesand Regulations with respect to tenants of the Project in a discriminatorymanner.  Landlord shall not be liable toTenant for or in connection with the failure of any other tenant of the Projectto comply with any rules and regulations applicable to such other tenant underits lease.  Notwithstanding anything tothe contrary herein or in any Rules and Regulations, in the event of a conflictbetween the terms of this Lease and the terms of any Rules and Regulations, nowexisting or hereafter adopted, the terms of this Lease shall prevail.

             **5.17    ****Hazardous Materials****.**

             (a)         Tenant shall not cause or permit anyHazardous Material to be brought upon, kept or used in or about the LeasedPremises by Tenant or Tenant Parties without the prior written consent ofLandlord, save and except only for Permitted Hazardous Materials, which Tenantmay bring, store and use in reasonable quantities for their intended use in theLeased Premises, but only in full compliance with all Hazardous Materials Lawsand otherwise in a safe and prudent manner. If Tenant breaches the obligations stated in the preceding sentence, orif contamination of the Leased Premises by Hazardous Material occurs which iscaused by Tenant or Tenant Parties, or arises out of the activities of Tenantor those of Tenant Parties (or those of its subtenants), then Tenant shallindemnify, defend, protect and hold Landlord and Landlord Parties harmless fromand against any and all claims, judgments, damages, penalties, fines, costs,expenses, liabilities or losses (including, without limitation, diminution invalue of the Leased Premises, damages for the loss or restriction on use ofrentable or useable space or of any amenity of the Leased Premises, damagesarising from any adverse impact on marketing of space, and sums paid insettlement of claims, attorneys’ fees, consultants’ fees and experts’ fees)(collectively, “**Claims**”) which arise duringor after the Term as a result of such contamination.  This indemnification of Landlord by Tenant includes, withoutlimitation, costs incurred in connection with any investigation of siteconditions or any clean-up, remedial, removal or restoration work required byany federal, state or local governmental agency or political subdivisionbecause of Hazardous Material present in the soil or ground water on or underthe Leased Premises.  The foregoingindemnity shall survive the expiration or earlier termination of this Lease.
             (b)        Tenant shall immediately notify Landlordof (i) any inquiry, test, investigation or enforcement proceeding by anygovernmental agency or authority against Tenant, Landlord or the LeasedPremises, Building or Project relating to any Hazardous Materials or under anyHazardous Materials Laws, or (ii) the occurrence of any event or existenceof any condition that would cause a breach of any of the covenants set forth inthis Section 5.17.

**             5.18    ****Surrenderof Premises On Termination****.**  On or before the ninetieth (90th) daypreceding the Term Expiration Date, Tenant shall notify Landlord in writing ofthe precise date upon which Tenant plans to surrender the Leased Premises toLandlord.  On expiration of the Term,Tenant shall quit and surrender the Leased Premises to Landlord, broom clean,in good order, condition and repair as required by Section 5.04, with allof Tenant’s movable equipment, furniture, trade fixtures and other personalproperty removed therefrom. Notwithstanding anything to the contrary herein, unless Tenant hasobtained Landlord’s agreement in writing that it can remove any Alteration, allAlterations shall be surrendered with the Leased Premises in the same conditionas when received, reasonable wear and tear (but only to an extent consistentwith the Leased Premises remaining in good condition and repair) and casualtydamage excepted.  Any property of Tenantnot removed hereunder shall be deemed, at Landlord’s option, to be abandoned byTenant and Landlord may store such property in Tenant’s name at Tenant’sexpense, and/or dispose of the same in any manner permitted by law.  Notwithstanding the foregoing, if Landlorddesires to have the Leased Premises, or any part or parts thereof, restored toa condition that existed prior to the making of any Alterations, Landlord shallso notify Tenant in writing not later than sixty (60) days prior to theregularly scheduled Term Expiration Date (or if this Lease is soonerterminated, upon the date of such termination); and upon receipt of suchnotice, Tenant shall, at Tenant’s sole cost and expense, so restore the LeasedPremises, or such part or parts thereof, before the regularly scheduled TermExpiration Date (or if this Lease is sooner terminated, within ten (10)days thereafter), provided that, with respect to any laboratories, testingrooms or other research facilities constructed within the Leased Premises forwhich Landlord requires removal, Tenant shall remove such laboratories, testingrooms or other research facilities and shall restore the area of the LeasedPremises affected thereby to a drywall shell condition.  Tenant shall repair at its sole cost andexpense, all damage caused to the Leased Premises or the Project by removal ofTenant’s movable equipment or furniture and such Alterations as Tenant shall beallowed or required to remove from the Leased Premises by Landlord.  Without limiting the foregoing, Tenantacknowledges and hereby agrees that Landlord’s rights to require removal of anyAlterations hereunder shall extend to the right to require removal of anyconduit, wiring, cabling or other telecommunications equipment locatedinstalled anywhere within the Project by or on behalf of Tenant.  If the Leased Premises are not surrenderedas of the end of the Term in the manner and condition herein specified, Tenantshall indemnify, defend, protect and hold Landlord and Landlord Partiesharmless from and against any and all Claims resulting from or caused byTenant’s delay or failure in so surrendering the Leased Premises, including,without limitation, any Claims made by any succeeding tenant due to such delayor failure.  Tenant acknowledges thatLandlord will be attempting to lease the Leased Premises with any such lease tobe effective upon expiration of the Term, and failure to surrender the LeasedPremises could cause Landlord to incur liability to such successor tenant forwhich Tenant shall be responsible hereunder to the full extent thereof.
**             5.19    ****WindowCoverings****.**  All window coverings shall be provided byTenant, at its sole cost and expense, and shall comply with Landlord’s standardBuilding window covering.  Tenant shallnot place or maintain any window coverings, blinds or drapes on any exteriorwindow, other than those in compliance with Landlord’s standards, withoutLandlord’s prior written approval which Landlord shall have the right to grantor withhold in its absolute and sole discretion exercised in good faith.  Tenant acknowledges that breach of thiscovenant will directly and adversely affect the exterior appearance of theProject and the operation of the heating, ventilation or air conditioningsystems.

             **5.20**     **Tenant’sRight to Repair****.**

             (a)         Withoutlimiting Tenant’s other rights hereunder, if Landlord fails to perform any ofits obligations under this Lease and such failure (i) materially andadversely affects Tenant’s use and occupancy of the Building for the operationof Tenant’s business therein; and (ii) continues for more than ten (10)business days after written notice from Tenant to Landlord of such failure (orif the nature of the failure is such that it cannot be cured within said ten(10) business day period, then if Landlord fails to commence to cure theoriginal failure within said ten (10) business day period or thereafter failsto diligently prosecute the cure of such original failure to completion) thenTenant may give Landlord a second notice of such original failure, reiteratingthe request that Landlord cure such failure and stating that, if Landlord failsto commence cure of such original failure within seven (7) days of the receiptof such second notice from Tenant, that Tenant will elect to promptlythereafter commence the cure of such failure by Landlord in the performance ofits obligations hereunder.  If Tenantelects, at Tenant’s sole option, to deliver the second notice of failure andelection to cure, then following Tenant’s completion of the cure of suchfailure by Landlord, Tenant shall have the right to demand reimbursement fromLandlord for all reasonable costs of performing such cure that are incurred byTenant.  If Tenant demands reimbursementof such reasonable costs from Landlord in writing and Landlord fails to paysuch reasonable costs within ten (10) business days after Landlord’s receipt ofTenant’s written demand therefore together with all invoices related to suchcosts for which Tenant is seeking reimbursement, then at the election of Tenantthe matter shall be submitted to arbitration in accordance withSection (b) below.  If Tenantobtains an award of such reasonable costs in an arbitration performed inaccordance with Section (b) below and Landlord fails to pay the amount ofsuch reasonable costs so awarded to Tenant within ten (10) business days afterthe date that such arbitration award is rendered, Tenant shall have the rightto offset the amount of such reasonable costs of cure of the Landlord default,as so awarded in such arbitration, from the Base Rent payable under this Lease.
             (b)        Uponwritten request of Tenant delivered to Landlord following Landlord’s failure orrefusal to pay any amounts demanded in accordance with Section 5.20(a)above, Landlord and Tenant shall arbitrate: (i) whether Landlord hadactually failed in the performance of its obligations under this Lease;(ii) If there was a failure by Landlord then whether Tenant had a right tocure such failure by Landlord under this Section 5.20; and (iii) ifTenant had such a right to cure, whether and to what extent the costs incurredby Tenant to cure the failure by Landlord were reasonable in type and amount.  The arbitration shall be conducted anddetermined in the City of Redwood City in accordance with the then–prevailingcommercial arbitration rules of the American Arbitration Association or itssuccessor for arbitration of commercial disputes (collectively, “**AAA**”), except as modifiedby this Section 5.20(b).  Thedecision rendered in any arbitration shall be binding upon the parties heretoand may be entered in any court having jurisdiction over the Project.  Notwithstanding the AAA rules, anyarbitration under this Section 5.20(b) shall be held before a singlearbitrator who shall be experienced in the areas of law raised by the subjectmatter of the dispute.  Lists ofprospective arbitrators shall include retired judges.  Notwithstanding the AAA rules, the parties shall use their bestgood faith efforts to select an arbitrator within forty–five (45) daysafter Tenant’s delivery of a written request to arbitrate and the parties shalluse their best good faith efforts to complete the arbitration within ninety(90) days after Tenant’s delivery of a written request to arbitrate, providedthat (a) any party may strike from a list of prospective arbitrators anyindividual who is regarded by that party as not appropriate for the dispute;and (b) if the arbitrator appointment cannot be made from the initial list ofprospective arbitrators circulated by the AAA, a second list shall becirculated and exhausted before the AAA is empowered to make the appointment.  The arbitrator shall render his/her decisionand award in writing with counterpart copies to each party.  The arbitrator shall have no power to modifythe provisions of this Lease.  Subject to the prevailing party’s right toreimbursement pursuant to Section 7.13 below, each party shall pay thefees and costs of its own counsel and the fees payable to the arbitrator shallbe borne equally by the parties.

**ARTICLE6**

**Condition and Operation of theBuilding**

**             6.01    ****As-IsCondition****.**  Tenant understands and agrees that theLeased Premises, including, without limitation, the existing improvementstherein and the Building Systems servicing the Leased Premises, shall be leasedby Tenant in its existing As-Is condition without any improvements,alterations, upgrades or enhancements by Landlord, provided that, Landlord shalldeliver the Leased Premises to Tenant with all currently existing BuildingSystems in good working order for general office uses, and to the extent thatany portion of the Leased Premises is significantly damaged in the course ofKana’s vacating of the Leased Premises then Landlord shall reasonably enforceany provisions within Kana’s former lease of the Leased Premises with respectto restoration and repair of the Leased Premises upon Kana’s vacating of thesame, including, without limitation, application of the proceeds of anysecurity deposit currently held by Landlord with respect to Kana’s leasetowards the costs of repair and restoration of the Leased Premises, all inaccordance with the terms and conditions set forth within the lease betweenLandlord and Kana.  Landlord herebyrepresents to Tenant that, to Landlord’s actual knowledge without duty ofinvestigation, there are no currently existing material defects in the LeasedPremises or the Building Systems as of the date of this Lease which have nototherwise been previously disclosed to Tenant. Landlord shall have no other obligation of any kind or character,express or implied, with respect to the condition of the Leased Premises or thesuitability thereof for Tenant’s purposes or with respect to alterations,additions, improvements, upgrades or enhancements to the Leased Premises, theBuilding Systems, the Building or the Project, and Tenant acknowledges that ithas neither received nor relied upon any representation or warranty made by oron behalf of Landlord with respect to such matters.  By entry hereunder, Tenant accepts the Leased Premises assuitable for Tenant’s intended use and as being in good and sanitary operatingorder, condition and repair, As-Is and without representation or warranty byLandlord as to the condition, use or occupancy which may be made thereof.
**             6.02    ****Alteration of Project****.**  Landlord may, at any time and from time totime:  (i) make structuralmodifications and/or seismic modifications that are either required to be performedby Landlord in accordance with the provisions of this Lease or otherwiserequired by any Laws affecting the Building; (ii) make externalalterations to the Building; (iii) change, add to, eliminate or reduce theextent, size, shape or configuration of any aspect of or improvement within theProject (with the exception of the Building) or its operations (including,without limitation, parcelizing the Project into one or more separate legallots and/or realigning boundary lot lines of any such legal lots now orhereafter comprising the Project (collectively “**Parcelization**”));and (iv) change the name, number or designation by which the Building orthe Project is commonly known.  None ofthe foregoing acts shall be deemed an actual or constructive eviction ofTenant, shall entitle Tenant to any reduction of Rent or shall result in anyliability of Landlord to Tenant, provided, that, in the event item (iii)results from Landlord’s independent actions (as opposed to any requirementimposed by any state, city, or county governmental or quasi-governmentalauthority having jurisdiction over the Project or otherwise resulting from theactions of any state, city or county governmental or quasi-governmentalauthority), then Landlord shall reimburse Tenant for the reasonable costsincurred by Tenant in changing addresses on stationery, business cards,directories and other such items in a sum not to exceed Five Hundred Dollars($500.00).  Landlord shall have theexclusive rights to the airspace above and around, and the subsurface below,the Leased Premises, the Building and other portions of the Project, including,without limitation, the exclusive right to use all exterior walls, roofs andother portions of the Building (including, without limitation, the right to installany equipment, antennas, signs, notices or other promotional items).  Without limiting the foregoing, Tenantagrees to fully cooperate with Landlord to allow Landlord to accomplish anysuch Parcelization, as referenced in clause (ii) above, and acknowledgesthat, the real property currently comprising the Project may be operated as anintegrated project irrespective of any such Parcelization.

**ARTICLE7**

**Casualty,Eminent Domain and Miscellaneous Matters**

**             7.01    ****Landlord’sInsurance****.**  Landlord shall maintain, or cause to bemaintained, a policy or policies of insurance with the premiums thereon fullypaid in advance, issued by and binding upon an insurance company of goodfinancial standing, insuring the Project against loss or damage by fire orother insurable hazards (that may include earthquake loss if Landlord elects tomaintain such coverage) and contingencies for the full insurable value thereof,exclusive of excavations and foundations; provided, however, that Landlordshall not be obligated to insure any of Tenant’s furniture, equipment,machinery, trade-fixtures, goods or supplies (“**Tenant’sPersonal Property**”), or any Alterations that Tenant may makeupon the Leased Premises.  If the annualpremiums charged Landlord for such casualty insurance exceed the standardpremium rates and such excess is in any way related to the Alterations or tothe nature of Tenant’s operations in the Leased Premises, including, withoutlimitation, a determination that such operations result in extra-hazardous orhigher than normal risk exposure, then Tenant shall, upon receipt ofappropriate premium invoices, reimburse Landlord for such increases inpremium.  Landlord shall maintain, orcause to be maintained, a policy or policies of rental interruption insurancewith respect to the Building in an amount equal to not less than one (1)year of Base Rent payable hereunder. All insurance proceeds payable under Landlord’s insurance carriedhereunder shall be payable solely to Landlord, and Tenant shall have nointerest therein.  Without limiting theforegoing, if at any time during the Term of this Lease Landlord continues toelect to maintain earthquake insurance coverage despite the fact that(i) such earthquake insurance is not then available at commerciallyreasonable rates, and (ii) the election to carry such earthquake insuranceis not consistent with prudent business practices of institutional owners ofcommercial properties in central and southern San Mateo County of a comparablesize, construction, age and quality to that of the Project, then, except whereLandlord’s continued maintenance of such earthquake insurance is required byany Mortgage Lender’s loan documents related to the Project, Tenant may objectto the continued maintenance of such policy of earthquake insurance on theBuilding by Landlord, in which event so long as Landlord continues to maintainsuch policy of earthquake insurance while the conditions referenced initems (i) and (ii) continue to exist, the cost thereof may only beincluded within Building Operating Cost to the extent of the cost of suchearthquake insurance immediately prior to any rate increases which resulted inthe existence of the conditions identified as items (i) and (ii) above.
**             7.02    ****LiabilityInsurance****.**  Landlord (with respect to the Project) andTenant (with respect to the Leased Premises and Project) shall each maintain orcause to be maintained a policy or policies of commercial general liabilityinsurance with the premiums thereon fully paid in advance, issued by andbinding upon an insurance company of good financial standing, such insurance toafford minimum protection of not less than Five Million Dollars ($5,000,000.00)combined single limit for bodily injury and property damage in any oneoccurrence.  The coverages required tobe carried shall be extended to include, but not to be limited to, blanketcontractual liability, personal injury liability (libel, slander, false arrestand wrongful eviction), and broad form property damage liability.  Tenant’s contractual liability insuranceshall apply, without limitation, to all of Tenant’s indemnity obligations underthis Lease.  The certificate evidencingTenant’s insurance coverage required hereunder shall state that the insuranceincludes the liability assumed by Tenant under this Lease and that Tenant’sinsurance is primary with any other insurance available to Landlord or anyother named insured being excess.  Uponrequest of Tenant, Landlord shall provide Tenant reasonable evidence that theinsurance required to be maintained hereunder by Landlord is in full force andeffect.

             **7.03**     **Tenant’s CasualtyInsurance and Additional Tenant Insurance Requirements****.**

             (a)         Tenant shall provide insurance coverageduring the Term against loss or damage by fire and such other risks as are fromtime to time included in an Insurance Services Offices (ISO) “Causes ofLoss – Special Form” policy (including, without limitation,sprinkler leakage and water damage), insuring the full insurable value of anyAlterations, Tenant’s trade fixtures, furnishings, equipment, and all otheritems of personal property of Tenant, insuring the full replacement costthereof.
             (b)        All policies required to be carried byTenant under this Article 7 shall be written with financially responsiblecompanies with a Best & Company rating of “B+” or better, and allevidence of insurance provided to Landlord shall contain an endorsement showingthat Landlord and Mortgage Lender are included as an additional insured and anendorsement whereby the insurer agrees not to cancel or alter the policywithout at least thirty (30) days’ prior written notice to Landlord andall named and additional insureds.  Anydeductible or self-insurance provisions under any insurance policies maintainedby Tenant shall be subject to Landlord’s prior written approval which shall notbe unreasonably withheld.

             (c)         Prior to the Term Commencement Date andthereafter, from time to time, promptly upon request by Landlord, Tenant shallfurnish Landlord and any additional insureds with copies of policies orcertificates of insurance, evidencing Tenant’s maintenance and renewal of therequired coverages.  If Tenant fails toprovide such evidence of insurance required hereunder, Landlord shall beauthorized (but not required) to procure such coverage in the amounts statedwith all costs thereof to be charged to Tenant and paid upon written invoicetherefor as Additional Rent together with an administrative fee equal to twentypercent (20%) of such costs.

             **7.04**     **Indemnityand Exoneration****.**

             (a)         Landlord shall not be liable to Tenant(i) for any loss, damage or injury to person or property caused by theft,fire, vandalism, assault, battery, act of God, acts of the public enemy, actsof terrorists or criminals, riot, strike, insurrection, war, court order, requisitionor order of governmental body or authority, whether or not the negligence ofLandlord was a partial cause of such loss, damage or injury, or (ii) thatoccur by reason of the negligence or willful misconduct of Tenant or TenantParties, or (iii) for any damage or inconvenience which may arise throughrepair of any part of the Project, alteration to any part of the Projectpermitted hereunder, or failure to make any such repair except as expresslyotherwise provided in Sections 7.06 and 7.07.  Without limiting the foregoing and notwithstanding anything tothe contrary herein, Tenant acknowledges that no security services are beingprovided to the Leased Premises, and to the extent any security service isbeing provided to the Project by Landlord, such security service shall beprovided by unarmed personnel and shall not include alarm systems for a specialsurveillance of the Leased Premises or the Project, and Tenant agrees, thatLandlord shall not be liable to Tenant or any third party for any breach of securityor any losses due to theft, burglary, battery or for damage done or injuryinflicted by persons (other than the employees of Landlord) in or on theProject.

             (b)        Tenant shall indemnify, defend, protectand hold Landlord and Landlord Parties harmless from and against any and allClaims arising out of or related to claims of injury to or death of persons,damage to property occurring or resulting directly or indirectly from the useor occupancy of the Leased Premises or activities of Tenant or its employees inor about the Leased Premises or Project; provided, however, that the foregoingindemnity shall not be applicable to claims arising by reason of the grossnegligence or willful misconduct of Landlord, unless covered by insurancerequired to be carried by Tenant under the terms of this Lease.
             (c)         Tenant shall indemnify, defend andprotect Landlord and hold and save Landlord harmless of and from any and allloss, claims, proceedings, cost, damage, injury, causes of action, liabilitiesor expense or other Claims arising out of or in any way related to work orlabor performed, materials or supplies furnished to or at the request of Tenantor in connection with performance of any work done for the account of Tenant inthe Leased Premises or the Project.

**             7.05    ****Waiverof Subrogation Rights****.**  Anything in this Lease to the contrarynotwithstanding, Landlord and Tenant each waive all rights of recovery, claim,action or cause of action, against the other, Tenant Parties or LandlordParties, as applicable, for any loss or damage that may occur to the LeasedPremises, or any improvements thereto, or the Project or any personal propertyof such party therein, by reason of fire, the elements, or any other cause thatcould be insured against under the terms of an ISO “Causes ofLoss – Special Form” insurance policy or other casualty insurancecoverages which are required to be obtained pursuant to this Lease, regardlessof cause or origin, including negligence of the other party, Landlord Partiesor Tenant Parties, as applicable; and each party covenants that no insurershall hold any right of subrogation against such other party.  Tenant shall advise its insurers of theforegoing and such waiver shall be a part of each policy maintained by Tenantthat applies to the Leased Premises, any part of the Project or Tenant’s useand occupancy of any part thereof.

             **7.06**     **Condemnation****.**

             (a)         If the Leased Premises or any portionof the Project shall be taken or condemned for any public purpose to such anextent as to render the Leased Premises untenantable as reasonably determinedby Landlord, this Lease shall, at the option of either party, forthwith ceaseand terminate as of the date of taking. All proceeds from any taking or condemnation of the Leased Premisesshall belong to and be paid to Landlord subject to the rights of any MortgageLender; provided, however, that Landlord shall cooperate with Tenant, atTenant’s sole cost and expense, if Tenant seeks to recover proceeds, damages orawards paid to compensate for damage to or taking of Tenant’s PersonalProperty.

             (b)        If a temporary taking of all or aportion of the Leased Premises occurs, there shall be no abatement of Rent andTenant shall remain fully obligated for performance of all of the covenants andobligations on its part to be performed pursuant to the terms of thisLease.  All proceeds awarded or paidwith respect thereto shall belong to Tenant.

**             7.07    ****Damage and Destruction****.**  If a fire or other casualty in the LeasedPremises occurs, Tenant shall immediately give notice thereof to Landlord.  In the event of a fire or other casualty inany portion of the Building, the following provisions shall then apply:

             (a)         If thedamage is limited solely to the Leased Premises and the Leased Premises can, inthe reasonable opinion of Landlord, be made tenantable with all damage repairedwithin twelve (12) months from the date of damage or destruction, then Landlordshall diligently rebuild the same.  IfLandlord rebuilds the Leased Premises, Tenant shall repair and restore any Alterationsor, at Landlord’s election, Landlord may repair and rebuild such Alterations,at Tenant’s sole cost and expense.
             (b)        If Section 7.07(a) does not apply,Landlord shall notify Tenant within sixty (60) days after the date of suchdamage and destruction of Landlord’s reasonable estimate of the time requiredfor restoration of the Leased Premises and/or the Building, as applicable (“**Casualty Notice**”), andthereafter Landlord may terminate this Lease within thirty (30) days afterthe date of such Casualty Notice. Notwithstanding the foregoing, if the Leased Premises can not, in thereasonable opinion of Landlord, be made tenantable with all damage to berepaired by Landlord completed within eighteen (18) months from the date ofsuch Casualty Notice, then Tenant may terminate this Lease withinthirty (30) days after the date of Tenant’s receipt of such CasualtyNotice.

             (c)         During any period when Tenant’s use ofthe Leased Premises is significantly affected by damage or destruction, GrossRent shall abate proportionately until such time as the Leased Premises aremade tenantable as reasonably determined by Landlord, and no portion of theRent so abated shall be subject to subsequent recapture; provided, however,that there shall be no such abatement except to the extent that the amountthereof is compensated for and recoverable from the proceeds of rentalabatement or business interruption insurance maintained or required to bemaintained by Landlord with respect to this Lease, the Leased Premises or the Project.

             (d)        Theproceeds from any insurance paid by reason of damage to or destruction of theBuilding or any part thereof, or any other element, component or propertyinsured by Landlord shall belong to and be paid to Landlord subject to therights of any mortgagee of Landlord’s interest in the Project or thebeneficiary of any deed of trust that constitutes an encumbrance thereon.  If this Lease is terminated by either partyas a consequence of a casualty in accordance with any of the provisions of thisSection 7.07(d), all proceeds of insurance required to be maintainedeither by Landlord or Tenant shall be paid to Landlord subject to the rights ofany mortgagee of Landlord’s interest in the Project or the beneficiary of anydeed of trust that constitutes an encumbrance thereon; provided, however, thatTenant shall be paid all proceeds of insurance payable in connection withTenant’s trade fixtures, furnishings, equipment and all other items of personalproperty of Tenant.

             (e)         If the Leased Premises, or any partthereof, or any portion of the Building is damaged or destroyed during the lasttwelve (12) months of the Term, or any extension thereof, and the damagecan not, in the reasonable opinion of Landlord, be repaired within six (6)months from the date of damage or destruction, then either Landlord or Tenantmay terminate this Lease by giving written notice thereof to the other partywithin thirty (30) days after the date of the casualty, in which case thisLease shall terminate as of the date of the casualty.

             **7.08**     **Default By Tenant****.**

             (a)         Eventsof Default.  The occurrence of anyof the following shall constitute an event of default (“**Event of Default**”) on thepart of Tenant:

                           (i)          Nonpaymentof Rent.  Failure to pay anyinstallment of Gross Rent or items of Additional Rent or any other amount to bepaid by Tenant hereunder, upon the date when payment is due, such failurecontinuing for a period of five (5) business days after written notice ofsuch failure;
                           (ii)         ChronicDelinquency.  Chronic delinquency byTenant in the payment of Gross Rent or items of Additional Rent or any otheramount to be paid by Tenant hereunder. “**Chronic delinquency**” shallmean failure by Tenant to pay Gross Rent or items of Additional Rent or anyother amount to be paid by Tenant hereunder within three (3) businessdays after written notice thereof for any three (3) months (consecutive ornonconsecutive) during any period of twelve (12) months.  In the event of a Chronic delinquency, inaddition to Landlord’s other remedies for an Event of Default providedhereunder, at Landlord’s option, Landlord shall have the right to require thatGross Rent be paid by Tenant quarterly, in advance;

                           (iii)        Other Obligations.  Failure to perform any obligation, agreementor covenant under this Lease other than those matters specified inSections 7.08(a)(i) and 7.08(a)(ii), such failure continuing forfifteen (15) business days after written notice of such failure (or withrespect to non-monetary obligations only, such longer period as is reasonablynecessary to remedy such default, provided that Tenant shall continuously anddiligently pursue such remedy at all times until such default is cured);

                           (iv)       General Assignment.  A general assignment by Tenant for thebenefit of creditors;

                           (v)        Bankruptcy.  The filing of any voluntary petition inbankruptcy by Tenant, or the filing of an involuntary petition by Tenant’screditors, which involuntary petition remains undischarged for a period ofsixty (60) days.  If underapplicable law the trustee in bankruptcy or Tenant has the right to affirm thisLease and continue to perform the obligations of Tenant hereunder, such trusteeor Tenant shall, in such time period as may be permitted by the bankruptcycourt having jurisdiction, cure all defaults of Tenant hereunder outstanding asof the date of the affirmance of this Lease and provide to Landlord suchadequate assurances as may be necessary to ensure Landlord of the continuedperformance of Tenant’s obligations under this Lease;

                           (vi)       Receivership.  The employment of a receiver to takepossession of substantially all of Tenant’s assets or the Leased Premises, ifsuch receivership remains undissolved for a period of twenty (20) businessdays after creation thereof;

                           (vii)      Attachment.  The attachment, execution or other judicialseizure of all or substantially all of Tenant’s assets or the Leased Premises,if such attachment or other seizure remains undismissed or undischarged for aperiod of twenty (20) business days after the levy thereof;

                           (viii)     Insolvency.  The admission by Tenant in writing of itsinability to pay its debts as they become due, the filing by Tenant of apetition seeking any reorganization, arrangement, composition, readjustment,liquidation, dissolution or similar relief under any present or future statute,law or regulation, the filing by Tenant of an answer admitting or failingtimely to contest a material allegation of a petition filed against Tenant inany such proceeding or, if within sixty (60) days after the commencementof any proceeding against Tenant seeking any reorganization, or arrangement,composition, readjustment, liquidation, dissolution or similar relief under anypresent or future statute, law or regulation, such proceeding shall not havebeen dismissed.
             (b)        RemediesUpon Default.

                           (i)          Termination.  If an Event of Default occurs, Landlordshall have the right, with or without notice or demand, immediately (afterexpiration of the applicable grace periods specified herein) to terminate thisLease, and at any time thereafter recover possession of the Leased Premises orany part thereof and expel and remove therefrom Tenant and any other personoccupying the same, by any lawful means, and again repossess and enjoy theLeased Premises without prejudice to any of the remedies that Landlord may haveunder this Lease, or at law or equity by reason of Tenant’s default or of suchtermination.

                           (ii)         Continuation After Default.  Even though Tenant has breached this Leaseand/or abandoned the Leased Premises, this Lease shall continue in effect forso long as Landlord does not terminate Tenant’s right to possession underSection 7.08(b)(i) hereof, and Landlord may enforce all of its rights andremedies under this Lease, including, without limitation, the right to recoverRent as it becomes due.  Landlord hasthe remedy described in Section 1951.4 of the Civil Code of the State ofCalifornia or any successor code section (Landlord may continue the Lease ineffect after Tenant’s breach and abandonment and recover rent as it becomesdue, if Tenant has the right to sublet or assign, subject only to reasonablelimitations).  Acts of maintenance,preservation or efforts to lease the Leased Premises or the appointment ofreceiver upon application of Landlord to protect Landlord’s interest under thisLease shall not constitute an election to terminate Tenant’s right topossession.

             (c)         DamagesUpon Termination.  Should Landlordterminate this Lease pursuant to the provisions of Section 7.08(b)(i)hereof, Landlord shall have all the rights and remedies of a landlord providedby Section 1951.2 of the Civil Code of the State of California, orsuccessor code section.  Upon suchtermination, in addition to any other rights and remedies to which Landlord maybe entitled under applicable law, Landlord shall be entitled to recover fromTenant:  (i) the worth at the timeof award of the unpaid Rent and other amounts which had been earned at the timeof termination; (ii) the worth at the time of award of the amount by whichthe unpaid Rent which would have been earned after termination until the timeof award exceeds the amount of such Rent loss that the Tenant proves could havebeen reasonably avoided; (iii) the worth at the time of award of theamount by which the unpaid Rent for the balance of the Term after the time ofaward exceeds the amount of such Rent loss that the Tenant proves could bereasonably avoided; and (iv) any other amount necessary to compensateLandlord for all the detriment proximately caused by Tenant’s failure toperform its obligations under this Lease or which, in the ordinary course ofthings, would be likely to result therefrom. The “**worth at the time of award**”of the amounts referred to in (i) and (ii) shall be computed with interest ateighteen percent (18%) per annum or the highest lawful rate, whichever is thelower.  The “**worthat the time of award**” of the amount referred to in (iii)shall be computed by discounting such amount at the “discount rate” of theFederal Reserve Bank of San Francisco in effect as of time of award plusone percent (1%) and, where rental value is a material issue, shall be basedupon competent appraisal evidence.
             (d)        Computation of Rent For Purposes ofDefault.  For purposes of computingunpaid Rent that would have accrued and become payable under this Leasepursuant to the provisions of Section 7.08(c), unpaid Rent shall consistof the sum of:

                           (i)          the total Base Rent for the balance ofthe Term, plus

                           (ii)         a computation of the Building OperatingCost for the balance of the Term, the assumed Building Operating Cost for thecalendar year of the default and each future calendar year in the Term to beequal to the Building Operating Cost for the calendar year prior to the year inwhich default occurs compounded at a per annum rate equal to the mean averagerate of inflation for the preceding five (5) calendar years as determinedby reference to the Consumer Price Index—all items for theSan Francisco-Oakland-San Jose Area, All Urban Consumers, publishedby the Bureau of Labor Statistics of the United States Department of Labor(Base Year 1982–84=100), or such successor index as may be established toprovide a measure of the current purchasing power of the dollar.

             (e)         LateCharge.  In addition to its otherremedies, after written notice of its intention to invoke this paragraphbecause of previous late payments by Tenant, Landlord shall have the right toadd to the amount of any payment required to be made by Tenant hereunder thatis not paid on or before the date which is five (5) business days afterwritten notice that the same is due, an amount equal to five percent (5%) ofthe delinquency for each month or portion thereof that the delinquency remainsoutstanding, the parties agreeing that Landlord’s damage by virtue of suchdelinquencies would be difficult to compute and the amount stated hereinrepresents a reasonable estimate thereof. The provision for a late charge set forth in this Section 7.08(e),and any collection of a late charge by Landlord, shall not be deemed a waiverof any breach or Event of Default by Tenant under this Lease.  The late charge shall be due upon demand byLandlord at any time after failure to pay any installment of Rent, and in thecase of Gross Rent, without waiting for expiration of the period specified inSection 7.08(a)(i).

             (f)         Landlord’s Right To Perform.  In addition to and without limiting itsother remedies hereunder, Landlord shall have the right, but not the obligationto perform such obligations for Tenant’s account, including, withoutlimitation, the right to perform any repair, maintenance or replacementrequired to be performed by Tenant under Section 5.04 above, and the rightto pay any amounts due to the providers of any Utilities pursuant toSection 5.02 above.  All costsincurred by Landlord in performing any such obligations for the account ofTenant shall be repaid by Tenant to Landlord upon demand, together with anadministration fee equal to fifteen percent (15%) of such costs.

             (g)        Remedies Cumulative.  All of the remedies permitted or available toLandlord under this Lease, or at law or in equity, shall be cumulative and notalternative and invocation of any such right or remedy shall not constitute awaiver or election of remedies with respect to any other permitted or availableright or remedy.
             **7.09**     **Optionto the Extend the Term At Fair Market Rent****.**

             (a)         Subject to the terms of thisSection 7.09, Tenant shall have two (2) options (the first suchoption being referred to herein as the “**FirstRenewal Option**”, the second such option being referred toherein as the “**Second Renewal Option**”, andboth options collectively referred to herein as the “**RenewalOptions**”) to extend the Term of this Lease for a consecutiveperiod of five (5) years beyond the then applicable Term Expiration Date(each such extension a “**Renewal Term**”).  The Renewal Options are personal toDeltagen, Inc., as Tenant, and may only be exercised by Deltagen, Inc., asTenant, not by any sublessee or assignee, or by any other successor or assignof Deltagen, Inc., as Tenant, provided, that, the foregoing shall not precludeDeltagen, Inc. from exercising any such Renewal Options merely because asublessee or assignee of Deltagen, Inc. is then occupying all or any portion ofthe Leased Premises.  The First RenewalOption must be exercised, if at all, by written notice (“**Election Notice**”) fromTenant to Landlord given not more than eighteen (18) months nor less thantwelve (12) months prior to the initial Term Expiration Date.  The Second Renewal Option must be exercised,if at all, by an Election Notice from Tenant to Landlord given not more thaneighteen (18) months nor less than twelve (12) months prior to the TermExpiration Date, as extended by the first Renewal Term.  Any such Election Notice given by Tenant toLandlord shall be irrevocable.  TheRenewal Options and Tenant’s delivery of an Election Notice shall be effectiveonly if (i) no Event of Default is occurring under this Lease, nor(ii) is any event then occurring which with the giving of notice or thepassage of time, or both, would constitute an Event of Default hereunder,either at the time of Tenant’s delivery of the applicable Election Notice orthe time of commencement of the applicable Renewal Term, provided that, in thecase of clause (ii) above, such event shall not act to void the RenewalOptions and Tenant’s delivery of such Election Notice unless such eventcontinues to occur after Landlord has provided Tenant with five (5) dayswritten notice of its existence.  IfTenant fails to exercise the First Renewal Option in a timely manner, asprovided for above, the Renewal Options shall be void.  If Tenant validly exercises the FirstRenewal Option in a timely manner, as provided for above, but fails to exercisethe Second Renewal Option in a timely manner, as provided for above, the SecondRenewal Option shall be void.  EachRenewal Term shall be upon the same terms and conditions as the initial Term,except that the annual Base Rent during the applicable Renewal Term shall beequal to the Fair Market Rent as of the commencement of the Renewal Term;provided, however, that in no event shall the Base Rent during any Renewal Termbe less than the Base Rent payable hereunder immediately prior to thecommencement of such Renewal Term.

             (b)        FairMarket Rent for each Renewal Term shall be determined by Landlord with writtennotice given to Tenant prior to the commencement of the applicable RenewalTerm, subject to Tenant’s right of arbitration pursuant to the provisions ofSection 7.09(c) below.  Failure onthe part of Tenant to demand arbitration within thirty (30) days afterreceipt of notice from Landlord of Landlord’s determination of Fair Market Rentshall bind Tenant to the Fair Market Rent as determined by Landlord.  Should Tenant elect to arbitrate and shouldthe arbitration not have been concluded prior to the commencement of theRenewal Term, Tenant shall pay Base Rent to Landlord during the Renewal Term,including Base Rent adjusted to reflect Fair Market Rent as Landlord has sodetermined.  If the amount of FairMarket Rent as determined by arbitration is greater than or less thanLandlord’s determination, then any adjustment required to correct the amountpreviously paid shall be made by payment by the appropriate party withinten (10) days after such determination of Fair Market Rent.
             (c)         IfTenant disputes the amount claimed by Landlord as Fair Market Rent, and suchdispute cannot be resolved by mutual agreement, the dispute shall be submittedto arbitration.  The award rendered inany such arbitration may be entered in any court having jurisdiction and shallbe final and binding between the parties. The arbitration shall be conducted and determined in the City of RedwoodCity in accordance with the then-prevailing commercial arbitration rules of theAmerican Arbitration Association or its successor for arbitration of commercialdisputes except to the extent that the procedures mandated by said rules shallbe modified as follows:

                           (i)          Tenantshall make demand for arbitration, if at all, in writing withinthirty (30) days after service of Landlord’s determination of Fair MarketRent given under Section 7.09(b) above, specifying therein the name andaddress of the person to act as the arbitrator on its behalf.  The arbitrator shall be qualified as a realestate appraiser familiar with the Fair Market Rent of first-class commercialoffice and R&D space in central and southern San Mateo County whowould qualify as an expert witness over objection to give testimony addressedto the issue in a court of competent jurisdiction.  Failure on the part of Tenant to make a timely and proper demandfor such arbitration shall constitute a waiver of the right thereto.  Within ten (10) business days after theservice of Tenant’s demand for arbitration, Landlord shall have the right togive notice in writing to Tenant of Landlord’s adjusted determination of FairMarket Rent.  Within ten (10)business days following Tenant’s receipt of such notice, if Tenant and Landlordhave not agreed upon Fair Market Rent, Tenant shall notify Landlord in writingthat Tenant desires to renew its demand for arbitration.  Failure on the part of Tenant to give suchnotice shall constitute a waiver of the right to such arbitration, and Tenantshall be deemed to have accepted Landlord’s adjusted determination of FairMarket Rent.  Within ten (10)business days after the receipt of a notice to renew Tenant’s demand, Landlordshall give notice to Tenant, specifying the name and address of the persondesignated by Landlord to act as arbitrator on its behalf who shall besimilarly qualified.  If Landlord failsto notify Tenant of the appointment of its arbitrator, within or by the timeabove specified, then the arbitrator appointed by Tenant shall be thearbitrator to determine the issue.

                           (ii)         If two (2) arbitrators are chosenpursuant to Subsection (i) above, the arbitrators so chosen shall meetwithin ten (10) business days after the second arbitrator is appointedand, if within ten (10) business days after such first meeting the twoarbitrators shall be unable to agree promptly upon a determination of FairMarket Rent, they shall appoint a third arbitrator, who shall be a competentand impartial person with qualifications similar to those required of the firsttwo arbitrators pursuant to Subsection (i) above.  If they are unable to agree upon suchappointment within five (5) business days after expiration of saidten (10) day period, the third arbitrator shall be selected by the partiesthemselves, if they can agree thereon, within a further period of ten (10)business days.  If the parties do not soagree, then either party, on behalf of both, may request appointment of such aqualified person by the then Chief Judge of the United States District Courthaving jurisdiction over the City of Redwood City, acting in his privatenon-judicial capacity.  Request forappointment shall be made in writing with a copy given to the other party.  Each party agrees that said Judge shall havethe power to make the appointment; provided, however, that if the Chief Judgedoes not make a determination within ten (10) days of request by eitherparty for the appointment of a third arbitrator, appointment of such thirdarbitrator shall be made in accordance with the selection procedure of thecommercial arbitration rules of the American Arbitration Association or itssuccessor for arbitration of commercial disputes.  The three (3) arbitrators shall decide the dispute, if ithas not previously been resolved, by following the procedure set forth inSection (iii) below.
                           (iii)        Wherethe issue cannot be resolved by agreement between the two arbitrators selectedby Landlord and Tenant or settlement between the parties during the course ofarbitration, the issue shall be resolved by the three arbitrators in accordancewith the following procedure.  Thearbitrators selected by each of the parties shall state in writing theirrespective determinations of the Fair Market Rent, supported by the reasonstherefor with counterpart copies to each party.  The arbitrators shall arrange for a simultaneous exchange of suchproposed resolutions.  The role of thethird arbitrator shall be to select which of the two proposed resolutions mostclosely approximates his determination of Fair Market Rent.  The third arbitrator shall have no right topropose a middle ground or any modification of either of the two proposedresolutions.  The resolution he choosesas most closely approximating his determination shall constitute the decisionof the arbitrators and be final and binding upon the parties.

                           (iv)       If any arbitrator fails, refuses or isunable to act, his successor shall be appointed by him, but in the case of thethird arbitrator, his successor shall be appointed in the same manner asprovided for appointment of the third arbitrator.  The arbitrators shall attempt to decide the issue withinten (10) business days after the appointment of the third arbitrator.  Any decision in which the arbitratorappointed by Landlord and the arbitrator appointed by Tenant concur shall bebinding and conclusive upon the parties. Each party shall pay the fees and costs of its own counsel.  The losing party shall pay the fees andcosts of the arbitrators and of the expert witnesses (if any) of the prevailingparty as well as those of its expert witnesses.  For purposes hereof, the losing party shall be that party whoseselected arbitrator’s statement of Fair Market Rent was not selected by thethird arbitrator.

                           (v)        The arbitrators shall have the right toconsult experts and competent authorities with factual information or evidencepertaining to a determination of Fair Market Rent, but any such consultationshall be made in the presence of both parties with full right on their part tocross-examine.  The arbitrators shallrender their decision and award in writing with counterpart copies to eachparty.  The arbitrators shall have nopower to modify the provisions of this Lease.

**             7.10    ****NoWaiver****.**  Failure of Landlord or Tenant to declare anydefault immediately upon occurrence thereof, or delay in taking any action inconnection therewith, shall not waive such default, but Landlord or Tenant, asthe case may be, shall have the right to declare any such default at any timethereafter.  No waiver by Landlord of anEvent of Default, or any agreement, term, covenant or condition contained inthis Lease, shall be effective or binding on Landlord unless made in writingand no such waiver shall be implied from any omission by Landlord to takeaction with respect to such Event of Default or other such matter.  No express written waiver by Landlord of anyEvent of Default, or other such matter, shall affect or cover any other Eventof Default, matter or period of time, other than the Event of Default, matterand/or period of time specified in such express waiver.  One or more written waivers by Landlord ofany Event of Default, or other matter, shall not be deemed to be a waiver ofany subsequent Event of Default, or other matter, in the performance of thesame provision of this Lease.  Except asexpressly provided in this Lease, no waiver by Tenant of any agreement, term,covenant or condition contained in this Lease, shall be effective or binding onTenant unless made in writing and no such waiver shall be implied from anyomission by Tenant to take action with respect to such matter.  No express written waiver by Tenant of anymatter, shall affect or cover any other matter or period of time, other thanthe matter and/or period of time specified in such express waiver.  Except with respect to the provisions ofSections 7.09 and 7.33, one or more written waivers by Tenant of anymatter shall not be deemed to be a waiver of any subsequent matter, inLandlord’s performance of the same provision of this Lease.  Acceptance of Rent by Landlord hereunder, orendorsement of any check, shall not, in and of itself, constitute a waiver ofany breach or Event of Default or of any agreement, term, covenant or conditionof this Lease, except as to the payment of Rent so accepted, regardless ofLandlord’s knowledge of any concurrent Event of Default or matter.  Landlord may, at its election, apply anyRent received from Tenant to the oldest obligation outstanding from Tenant toLandlord, any endorsement or other statement of Tenant to the contrarynotwithstanding.  No course of conductbetween Landlord and Tenant, and no acceptance of the keys to or possession ofthe Leased Premises before the termination of the Term by Landlord or anyemployee of Landlord shall constitute a waiver of any such breach or of anyterm, covenant or condition of this Lease or operate as a surrender of thisLease.  All of the remedies permitted oravailable to Landlord under this Lease, or at law or in equity, shall becumulative and not alternative and invocation of any such right or remedy shallnot constitute a waiver or election of remedies with respect to any otherpermitted or available right or remedy.
**             7.11    ****StatutoryWaivers****.**  Tenant hereby waives the benefits of:  (i) Sections 1932 and 1933(4) ofthe California Civil Code (pertaining to the termination of a hiring);(ii) 1941 and 1942 of the California Civil Code (pertaining to theobligations of a landlord to maintain premises and the rights of a tenant tomake certain repairs or terminate a lease); (iii) Section 1263.260 ofthe California Code of Civil Procedure (pertaining to the removal ofimprovements upon condemnation); and (iv) Section 1265.130 of theCalifornia Code of Civil Procedure (pertaining to the termination of a leaseupon condemnation).

**             7.12    ****HoldingOver****.**  If Tenant holds over after expiration ortermination of this Lease without the written consent of Landlord, Tenant shallpay for each month of hold-over tenancy the greater of (i) one hundredfifty percent (150%) of the Gross Rent that Tenant was obligated to pay for themonth immediately preceding the end of the Term, or (ii) one hundred fiftypercent (150%) of the market rental amount then applicable to the LeasedPremises, for each month or any part thereof of any such hold-over periodtogether with such other amounts as may become due hereunder.  No holding over by Tenant after the Termshall operate to extend the Term.  IfTenant holds over without consent, Tenant shall indemnify, defend, protect andhold Landlord and Landlord Parties harmless from and against any and allclaims, judgments, damages, penalties, fines, costs, expenses, liabilities orlosses for damages by any other tenant or third person to whom Landlord mayhave leased or offered to lease all or any part of the Leased Premises coveredhereby effective on or after the termination of this Lease, together with allloss, cost, expense, damages and liabilities in connection with any suchreletting, including, without limitation, attorneys’ fees and Landlord’s lostrevenues.  Any holding over with theconsent of Landlord in writing shall thereafter constitute this Lease a leasefrom month to month.

**             7.13    ****Attorneys’ Fees****.**  Except as otherwise provided inSection 7.09(c) above, if either party places the enforcement of thisLease, or any part thereof, or the collection of any Rent due, or to become duehereunder, or recovery of the possession of the Leased Premises in the hands ofan attorney or collection agency, or files suit upon the same, or seeks ajudicial declaration of rights hereunder (including, without limitation, anyarbitration conducted in accordance with Section 5.20(b) above), theprevailing party shall recover its reasonable attorneys’ fees, court orarbitration costs and collection agency charges.  As used herein, “**prevailing party**”shall mean the party who substantially prevails in the matter at issue,including, without limitation, a party who dismisses an action for recoveryhereunder in exchange for payment of the sums allegedly due, performance ofcovenants allegedly breached or consideration substantially equal to the reliefsought in the action.
**             7.14    ****Amendments****.**  This Lease may not be altered, changed oramended, except by an instrument in writing signed by both parties.

**             7.15    ****TransfersBy Landlord****.**  Landlord shall have the right to transferand assign, in whole or in part, all of its rights and obligations hereunderand in the Project.  Upon transfer byLandlord of its interest in the Project, and upon the transferee’s assumptionof Landlord’s obligations hereunder, no liability or obligations shallthereafter accrue against the transferring or assigning person as Landlordhereunder with respect to obligations arising after the date of such transfer.

**             7.16    ****Severability****.**  If any term or provision of this Lease, orthe application thereof to any person or circumstances, shall to any extent beinvalid or unenforceable, the remainder of this Lease, or the application ofsuch provision to persons or circumstances other than those as to which it isinvalid or unenforceable, shall not be affected thereby, and each provision ofthis Lease shall be valid and shall be enforceable to the extent permitted bylaw.

**             7.17    ****Notices****.**  All notices, demands, consents and approvalsthat may or are required to be given by either party to the other hereundershall be in writing and shall be deemed to have been fully given by personaldelivery or when deposited in the United States mail, certified or registered,postage prepaid, and addressed to the party to be notified at the address forsuch party specified on the Basic Lease Information sheet, or to such otherplace as the party to be notified may from time to time designate by at leastfifteen (15) days’ notice to the notifying party.  Personal delivery of notices to Tenant mayin all events be made by leaving a copy of the notice, addressed to Tenant, atthe Leased Premises.  Tenant appoints asits agent to receive the service of all default notices and notice ofcommencement of unlawful detainer proceedings the person in charge of orapparently in charge of or occupying the Leased Premises at the time, and, ifthere is no such person, then such service may be made by attaching the same onthe main entrance of the Leased Premises.

**             7.18    ****NoOption****.**  Submission of this instrument forexamination or signature by Tenant does not constitute a reservation of or anoption for lease, and it is not effective as a lease or otherwise untilexecution and delivery by both Landlord and Tenant.

**             7.19    ****Integrationand Interpretation****.**  The terms of this Lease are intended by theparties as a final expression of their agreement with respect to such terms asare included in this Lease and may not be contradicted by evidence of any prioror contemporaneous agreement, arrangement, understanding or negotiation(whether oral or written).  The partiesfurther intend that this Lease constitutes the complete and exclusive statementof its terms, and no extrinsic evidence whatsoever may be introduced in anyjudicial proceeding involving this Lease. The language in all parts of this Lease shall in all cases be construedas a whole and in accordance with its fair meaning and not restricted for oragainst any party, regardless of which party may have drafted the provision inquestion, it being agreed that this is a negotiated agreement.
**             7.20    ****Quitclaim****.**  Upon expiration or earlier termination ofthis Lease, Tenant shall, immediately upon request of Landlord, execute,acknowledge and deliver to Landlord a recordable deed quit-claiming to Landlordall interest of Tenant in the Leased Premises, the Project and this Lease.

**             7.21    ****NoEasement For Light, Air and View****.**  This Lease conveys to Tenant no rights forany light, air or view.  No diminutionof light, air or view, or any impairment of the visibility of the LeasedPremises from inside or outside the Building, by any structure or other object thatmay hereafter be erected (whether or not by Landlord) shall entitle Tenant toany reduction of Rent under this Lease, constitute an actual or constructiveeviction of Tenant, result in any liability of Landlord to Tenant, or in anyother way affect this Lease or Tenant’s obligations hereunder.

**             7.22    ****NoMerger****.**  The voluntary or other surrender ortermination of this Lease by Tenant, or a mutual cancellation thereof shall notwork a merger, but, at Landlord’s sole option, shall either terminate all existingsubleases or subtenancies or shall operate as an assignment to Landlord of allsuch subleases or subtenancies.

**             7.23    ****Memorandumof Lease****.**  Tenant shall, upon request of Landlord,execute, acknowledge and deliver a short form memorandum of this Lease (and anyamendment hereto or consolidation hereof), in form suitable for recording.  In no event shall this Lease or anymemorandum thereof be recorded without the prior written consent of Landlord,and any attempt to do so shall constitute a default by Tenant.

**             7.24    ****Survival****.**  All of Tenant’s covenants and obligationscontained in this Lease shall survive the expiration or earlier termination ofthis Lease.  With the exception of anyapplicable notice and cure provisions expressly set forth in Section 7.08(a)above, no provision of this Lease providing for termination in certain eventsshall be construed as a limitation or restriction of Landlord’s rights andremedies at law or in equity available upon a breach by Tenant of this Lease.

**             7.25    ****FinancialStatements****.**  From time to time (but not more frequentlythan once per calendar quarter) Tenant shall, within fifteen (15) days ofLandlord’s written request, furnish Landlord with Tenant’s most recentquarterly financial statements, certified as accurate by Tenant or, ifavailable, audited financial statements audited by an independent certifiedpublic accountant (together with copies of the auditor’s statement), togetherwith a statement reflecting Tenant’s estimated “burn–rate” for theremainder of the then current calendar year and such additional information anddetail as Landlord may reasonably request. In addition, Tenant shall deliver to Landlord annual audited financialstatements during each calendar year of the Term audited by an independentcertified public accountant (together with copies of the auditor’s statement).

**             7.26    ****NoJoint Venture****.**  This Lease shall not be construed to createa partnership, joint venture or similar relationship or arrangement betweenLandlord and Tenant hereunder.
**             7.27    ****Successorsand Assigns****.**  This Lease shall be binding upon and inureto the benefit of Landlord, its successors and assigns (subject to theprovisions hereof, including, without limitation, Section 5.15); and shallbe binding upon and inure to the benefit of Tenant, its successors, and to theextent assignment may be approved by Landlord hereunder, Tenant’s assigns.

**             7.28    ****ApplicableLaw****.**  All rights and remedies of Landlord andTenant under this Lease shall be construed and enforced according to the lawsof the State of California.  Any actionsor proceedings brought under this Lease, or with respect to any matter arisingunder or out of this Lease, shall be brought and tried only in courts locatedin the County of San Mateo, California (excepting appellate courts).

**             7.29    ****Time ofthe Essence****.**  Time is of the essence of each and everycovenant herein contained.

**             7.30    ****Interpretation****.**  Except as specifically provided otherwise inthis Lease, Landlord may act in its sole and absolute discretion when requiredto act hereunder.  The term, “including”shall mean “including, without limitation.” All indemnities contained herein shall survive termination of this Leasewith respect to any act, condition or event that is the subject matter of suchindemnity and that occurs prior to the Term Expiration Date.  Notwithstanding anything herein to thecontrary, all provisions of this Lease which require the payment of money orthe delivery of property after the Term Expiration Date shall survivetermination of the Lease.

**             7.31    ****Parking****.**  Unless an Event of Default has occurred andshall be continuing hereunder, Tenant shall be entitled to the non–preferentialand non–exclusive use of 3.3 spaces for each 1,000 square feet of theLeased Premises, as the same may be expanded or reduced from time to time, inthe Common Areas, for which right Tenant shall pay the monthly fee, tax orassessment per space, if any, established or otherwise imposed by anygovernmental authority having jurisdiction over the Project in connection withthe parking privileges provided to Tenant pursuant to this Lease.  Said monthly fees, if any, shall be paid inthe same manner as Additional Rent hereunder, regardless of whether or notTenant uses said spaces.  Landlord mayassign any unreserved and unassigned parking spaces and/or make all or aportion of such spaces reserved, if it determines that it is necessary fororderly and efficient parking.  Landlordshall have the right, at any time, to relocate Tenant’s parking to other areaswithin the Project and to provide parking spaces to Tenant in surface parkinglots, parking structures or valet parking areas in the general vicinity of theBuilding now or hereafter designated by Landlord as the “**Project’s Parking Areas**.”  Notwithstanding anything to the contrary herein,during the initial Term, Tenant’s right to use the parking spaces providedherein shall be free of charge.

**             7.32    ****Brokers****.**  Tenant and Landlord each represent andwarrant to the other that it has had no dealing with any broker or agent otherthan the Broker set forth on the Basic Lease Information.  Tenant and Landlord each indemnify, defendand hold the other party harmless from and against any and all liabilities forcommissions or other compensation or charges claimed by any other broker oragent based on dealings with the indemnifying party with respect to thisLease.  The foregoing indemnity shallsurvive termination or earlier expiration of this Lease.
             **7.33**     **Rightof First Opportunity****.**

             (a)          Subject to the terms ofSubsection 7.33(b) below, Tenant is granted the conditionally recurringright to add to the Leased Premises additional space located within thebuilding commonly known as 720 Bay Road (“**BuildingThree**”), as and if such space becomes available (the term “**available**” is used hereinmeaning that (i) an Existing Lease (as defined in Subsection 7.33(b)below) has terminated, either by default, mutual agreement, or expiration ofthe term of such lease and of any renewal options, rights of first refusal oroptions or agreements of expansion related thereto, and (ii) that thespace which was the subject of such Existing Lease has not been relet to suchtenant, or to a subtenant or assignee of such tenant, immediately thereafter,either through the renewal of the previous lease with respect to such space orthe exercise of an expansion right with respect to such space by another tenantof the Project), each such space being referred to herein individual as a “**First Opportunity Space**”and each such conditionally recurring option being referred to herein as a “**Right of First Opportunity**”.  Each Right of First Opportunity is personalto Deltagen, Inc., as Tenant, and may not be exercised by any sublessee orassignee, or by any other successor or assign of Tenant.  Each Right of First Opportunity shall beeffective only if (i) no Event of Default is occurring under this Lease,nor (ii) is any event then occurring which with the giving of notice orthe passage of time, or both, would constitute an Event of Default hereunder,either at the time of exercise of the applicable Right of First Opportunity oron the date when such First Opportunity Space is added to the Leased Premisesas provided in Subsection 7.33(c) below, provided that, in the case ofclause (ii) above, such event shall not act to void the effectiveness of aRight of First Opportunity unless such event continues to occur after Landlordhas provided Tenant with five (5) days written notice of its existence.

             (b)        EachRight of First Opportunity shall be subject and subordinate to: (i) anylease existing as of the date of this Lease (“**ExistingLease**”) with respect to any increment of any space withinBuilding Three; (ii) any renewal or extension of the term of any ExistingLease, which extensions or renewals Landlord may enter into without regard tothe Right of First Opportunity granted in this Section 7.33; and(iii) any expansion option, right of first refusal or right of firstopportunity granted by Landlord to any third party prior to the date of thisLease.

             (c)         Notless than six (6) months prior to the date of expiration of all third partyleases or rights in any First Opportunity Space (or such shorter period whereLandlord has less notice in fact of an earlier termination), Landlord shallnotify Tenant in writing of such date. Each Right of First Opportunity must be exercised by Tenant, if at all,by written notice to Landlord delivered within fifteen (15) days after the dateof Landlord’s written notice to Tenant that a First Opportunity Space willbecome available.  Any such notice withrespect to any First Opportunity Space given by Tenant to Landlord shall beirrevocable.  Upon timely exercise ofany such Right of First Opportunity, the applicable First Opportunity Spaceshall be included under this Lease and added to the Leased Premises effectiveimmediately upon availability of such space, and such First Opportunity Spaceshall then become part of the Leased Premises for the remainder of the Term,and any validly exercised renewals thereof.

             (d)        The Base Rent applicable to each FirstOpportunity Space added to the Leased Premises shall be the Fair Market Rent ofsuch First Opportunity Space as of the date such First Opportunity Spacebecomes part of the Leased Premises.  Atthe time Landlord offers the applicable First Opportunity Space to Tenant,Landlord shall notify Tenant of Landlord’s determination of the Fair MarketRent for such First Opportunity Space. Within fifteen (15) days after receipt of such notice from Landlord,Tenant shall have the right to: (i) elect to accept Landlord’s statementof the Fair Market Rent as the Base Rent for the First Opportunity Space; or(ii) elect to require that Fair Market Rent be determined by arbitrationpursuant to Section 7.09(c) above. Failure by Tenant to elect arbitration of Fair Market Rent by writtennotice delivered to Landlord within such fifteen (15) day period shallconstitute an election by Tenant to accept Landlord’s statement of Fair MarketRent.
             (e)         In the event that Tenant fails toexercise any Right of First Opportunity with respect to any First OpportunitySpace that contains greater than nine thousand nine hundred ninety–nine(9,999) square feet of space in a timely manner as provided herein, suchRight of First Opportunity shall lapse and all future Rights of FirstOpportunity shall be null, void and of no force or affect, and Landlord shallthereafter have the right to lease any First Opportunity Space, including,without limitation, the First Opportunity Space for which tenant’s Right ofFirst opportunity has so lapsed, to any party or parties on terms deemedacceptable to Landlord in its sole and absolute discretion without any furtherobligation to Tenant under this Section 7.33.  In the event that Tenant validly exercises any Right of FirstOpportunity pursuant to the terms of this Section 7.33, Tenant shall takeany First Opportunity Space added to the Leased Premises in an “As-Is”condition, Tenant acknowledging and agreeing that Landlord shall have noobligation to improve, remodel or otherwise alter such First Opportunity Space;provided, however, that Landlord shall deliver such First Opportunity Space ina “broom clean” condition.

             (f)         From and after the commencement datespecified in Subsection 7.33(c) above with respect to any FirstOpportunity Space as to which the Right of First Opportunity has been validlyexercised by Tenant, all terms and provisions of this Lease shall apply to suchFirst Opportunity Space, except that all references to the Building herein,shall thereafter include Tenant’s respective portion of Building Three andTenant’s obligation to pay Tenant’s Proportionate Share of Estimated BuildingOperating Cost shall be expanded with respect to any such First OpportunitySpace to include Tenant’s Proportionate Share of Building Three, as increasedfrom time to time to reflect any additional First Opportunity Space which haspreviously been added to the Leased Premises, and the Estimated Operating Costsapplicable to Building Three.

             (g)        Within ten (10) business days after theexercise of any Right of First Opportunity, Tenant shall deliver to Landlordthe First Opportunity Credit required pursuant to Section 5.14(e) above.
             **7.34**     **Potential Lease ofHeartport Building****.**

             (a)         AutomaticExpansion.  The building commonlyknown as 700 Bay Road, Redwood City, California (“**HeartportBuilding**”) is currently the subject of that certain Amendedand Restated Industrial Build–To–Suit Lease (“**Heartport Lease**”) by andbetween Landlord (as Landlord thereunder) and Heartport, Inc., a Delawarecorporation (“**Heartport**”) (as Tenantthereunder).  Pursuant to that certainSublease Agreement (“**Deltagen Sublease**”),of even date herewith, between Tenant (as Subtenant) and Heartport (asSublandlord), and Landlord’s letter of consent in relation thereto of even dateherewith, Tenant will sublease the Heartport Building from Heartport.  Landlord and Tenant hereby agree that, inthe event that the Heartport Lease is terminated prior to July 14, 2010(hereinafter, a “**Heartport Lease Termination**”),then the Deltagen Sublease shall terminate by operation of law and all of thespace within the Heartport Building (the “**HeartportPremises**”) shall concurrently therewith automatically andunconditionally be deemed added to the Leased Premises without any additionalaction by Landlord or Tenant.  From andafter the date of the Heartport Lease Termination, all terms and provisions ofthis Lease shall apply to the Heartport Premises, except that all references tothe Building herein shall thereafter include the Heartport Building, andTenant’s obligation to pay Tenant’s Proportionate Share of Estimated BuildingOperating Cost shall be expanded with respect to the Heartport Premises toinclude Tenant’s Proportionate Share of the Heartport Building (which isacknowledged to be one hundred percent (100%) thereof); provided however, thatthe Base Rent payable by Tenant with respect to the Heartport Premises so addedto the Leased Premises shall be determined as provided below.  In the event of a Heartport Lease Terminationoccurring either on or before July 14, 2004 or on or after July 15,2007, the Base Rent payable by Tenant with respect to the Heartport Premisesshall be equal to the Base Rent which would have been payable by Tenant underthe Deltagen Sublease, from time to time, if the Deltagen Sublease had not beenterminated as set forth above.  In theevent of a Heartport Lease Termination occurring between July 15, 2004 andJuly 14, 2007 (inclusive), then the Base Rent payable by Tenant withrespect to the Heartport Premises shall be equal to the Base Rent payable byTenant from time to time pursuant to this Lease (i.e. for months 37 through 48an amount equal to $3.39 per square foot per month; for months 49 through 60 anamount equal to $3.49 per square foot per month; for months 61 through 72 an amountequal to $3.59 per square foot per month; etc.); provided however, that ifTenant’s demonstrated Net Cash Position at the time of the Heartport LeaseTermination is equal to or greater than Fifty Million Dollars ($50,000,000.00),then the Base Rent payable by Tenant with respect to the Heartport Premisesshall be equal to the Base Rent which would have been payable by Tenant underthe Deltagen Sublease, from time to time, if the Deltagen Sublease had not beenterminated as set forth above.  Tenanthereby agrees that in the event of a Heartport Lease Termination, Tenant willenter into an amendment to this Lease memorializing the addition of theHeartport Premises to the Leased Premises on the terms set forth in thisSection 7.34(a).  Tenant’sagreement to lease the Heartport Premises directly from Landlord in the eventof a Heartport Lease Termination occurring prior to July 14, 2010 is amaterial portion of the consideration for Landlord’s agreement to enter intothis Lease and any failure on the part of Tenant to accept the HeartportPremises as provided herein shall constitute an Event of Default hereunder.  Within ten (10) business days after theHeartport Lease Termination, Tenant shall deliver to Landlord an amendment tothe Letter of Credit increasing the then–current LC Face Amount byan amount equal to nine (9) months Base Rent applicable to the portion ofthe Leased Premises comprising the Heartport Premises, as determined inaccordance with the foregoing provisions (hereinafter the “**Heartport Lease Termination Credit”**).  Landlord and Tenant acknowledge and agreethat in the event that a Heartport Lease Termination shall have occurred, thenthe Heartport Premises shall be included within the Leased Premises during anyRenewal Termvalidly exercised pursuant to Section 7.09 above, provided that allreferences to the Building herein, shall include the Heartport Building asprovided in this Section 7.34(a), Tenant’s obligation to pay Tenant’sProportionate Share of Estimated Building Operating Cost shall be expanded toinclude Tenant’s Proportionate Share of the Heartport Building (which isacknowledged to be one hundred percent (100%) thereof) as provided in thisSection 7.34(a) and the applicable Base Rent payable with respect to theentire Leased Premises, including the Heartport Premises, shall be asdetermined in accordance with Section 7.09 above.
             (b)        ExpansionOption and Renewal Option In the Event that No Heartport Lease TerminationOccurs.  If a Heartport LeaseTermination has not occurred, then Tenant shall have the right of firstopportunity (“**Heartport Right of First Opportunity**”)to incorporate the Heartport Premises within the Leased Premises during theperiod of the first Renewal Term as part of a valid exercise of the FirstRenewal Option in accordance with the provisions of Section 7.09above.  Tenant’s election to include theHeartport Premises within the Leased Premises during the first Renewal Termmust be exercised, if at all, by written notice (“**HeartportElection Notice**”) from Tenant to Landlord given concurrentlywith the Renewal Option Notice.  IfTenant validly and timely delivers the Heartport Election Notice to Landlord,then the Heartport Premises shall be deemed a part of the Leased Premisesduring the first Renewal Term and, if Tenant validly exercises the SecondRenewal Option, during the second Renewal Term.  However, if Tenant fails to deliver a Heartport Election Noticeon a timely basis as provided herein, the Heartport Premises shall not beincluded within the Leased Premises during any Renewal Term and Tenant shall nolonger have any rights hereunder to lease the Heartport Premises afterJuly 14, 2010.  The HeartportElection Notice given by Tenant to Landlord shall be irrevocable.  Notwithstanding anything to the contraryherein, Tenant’s delivery of the Heartport Election Notice shall be effectiveonly if (i) no Event of Default is occurring under this Lease, nor(ii) is any event then occurring which with the giving of notice or thepassage of time, or both, would constitute an Event of Default hereunder,either at the time of Tenant’s delivery of the Heartport Election Notice or thetime of commencement of the first Renewal Term, provided that, in the case ofclause (ii) above, such event shall not act to void Tenant’s delivery ofthe Heartport Election Notice unless such event continues to occur afterLandlord has provided Tenant with five (5) days written notice of itsexistence.  If Tenant validly deliversthe Heartport Election Notice and validly exercises the First Renewal Option ina timely manner, then (i) the Heartport Premises shall be deemed a part ofthe Leased Premises upon the same terms and conditions of this Lease, exceptthat all references to the Building herein, shall thereafter include the HeartportBuilding and Tenant’s obligation to pay Tenant’s Proportionate Share ofEstimated Building Operating Cost shall be expanded with respect to theHeartport Premises to include Tenant’s Proportionate Share of the HeartportBuilding (which is acknowledged to be one hundred percent (100%) thereof),(ii) the applicable Base Rent payable with respect to the entire LeasedPremises, including the Heartport Premises, shall be as determined inaccordance with Section 7.09 above, and (iii) within ten (10)business days after the commencement of the first Renewal Term, Tenant shalldeliver to Landlord an amendment to the Letter of Credit increasing the then–currentLC Face Amount by an amount equal tonine (9) months Base Rent applicable to the portion of the Leased Premisescomprising the Heartport Premises or, if the conditions precedent to Tenant’sreduction of the LC Face Amount, in accordance with Section 5.14(b)above have been satisfied, six (6) months Base Rent applicable to theportion of the Leased Premises comprising the Heartport Premises (“**Heartport Option Credit**”).

             (c)         Notwithstanding anything to thecontrary herein and irrespective of the fact that Tenant may constructlaboratories, testing rooms or other research facilities within the HeartportPremises, no laboratories, testing rooms or other research facilitiesconstructed at any time by Tenant within the Heartport Premises shall be, atany time, subject to the requirements of Section 5.14(d) above, nor shallTenant, at any time, be obligated to comply with the requirements ofSection 5.14(d) above with respect to any such laboratories, testing roomsor other research facilities constructed, at any time, by Tenant within theHeartport Premises.

 

**[Lease Continues On FollowingPage]**
**             7.35     CounterpartOriginals.**  This Agreement may be executed incounterparts each of which shall be deemed an original but all of which takentogether shall constitute one and the same instrument.  The parties may execute and deliver thisLease by forwarding signed facsimile copies of this Lease.  Such facsimile signatures shall have thesame binding effect as original signatures, and the parties hereby waive anydefense to validity based on any such copies of signatures.

             IN WITNESS WHEREOF,the parties hereto have executed this Lease as of the day and year first abovewritten.
*LANDLORD:* WOODSIDE TECHNOLOGY CENTER, LLC, a  Delaware limited liability company   By:National  Office Partners Limited Partnership, a  Delaware limited partnership, its  sole member   By:Hines  National Office Partners Limited Partnership,  a  Texas limited partnership,  its  general partner     By:Hines  Fund Management, L.L.C.,   a  Delaware limited liability company,   its  general partner      By:Hines  Interests Limited Partnership,   a  Delaware limited partnership   its  sole member      By:Hines  Holdings, Inc.,   a  Texas corporation,   its  general partner      By:       Its:                   *TENANT:* DELTAGEN, INC., a  Delaware corporation     By:   Name:   Title:  
**Exhibit A–1**

**“Leased Premises Depiction”**

(tocome)

**Exhibit A–2**

**“Project Legal Description”**

The land referred to herein is located inthe State of California, County of San Mateo, and is described as follows:

Parcels 1, 2 and 3, as shown on thatcertain map entitled “Parcel Map No. 97–6, lying entirely within theCity of Redwood City, California”, filed in the office of the County Recorderof San Mateo County, State of California, on December 10, 1997 inBook 70 of Parcel Maps at page(s) 17 and 18.

**Exhibit B**

BuildingRules and Regulations
1.Tenant  shall not use any method of heating or air conditioning other than that  approved by Landlord without the prior written consent of Landlord, which  consent shall not be unreasonably withheld, conditioned or delayed.  2.Except  as otherwise provided in the Lease, all window coverings installed by tenant  and visible from the outside of the building require the prior written  approval of Landlord, which approval shall not be unreasonably withheld,  conditioned or delayed.  3.Tenant  shall not use, keep or permit to be used or kept any foul or noxious gas or  substance or any flammable or combustible materials on or around the  Premises, except to the extent that Tenant is permitted to use the same under  the terms of the Lease.  4.Tenant  shall park motor vehicles in the areas of the Project designated by Landlord  as parking areas, including areas for loading and unloading. During those  periods of loading and unloading, Tenant shall not unreasonably interfere  with traffic flow around the Building or the Project and loading and  unloading areas of other tenants.  5.Tenant  shall not waste electricity, water or air conditioning, shall cooperate fully  with Landlord to assure the most effective operation of the Building’s  heating and air conditioning systems and shall comply with any governmental  energy-saving rules or regulations about which Tenant has been given  notice.  Tenant shall not tamper with  or attempt to adjust temperature control thermostats in the Leased Premises;  Landlord shall make reasonable adjustments in thermostats upon request from  Tenant.  6.Canvassing,  peddling, soliciting, and distribution of handbills in the Building are  prohibited and Tenant will cooperate to prevent these activities.  7.Except  as provided in the Lease, Tenant shall not access the roof without Landlord’s  permission.  8.Business  machines and mechanical equipment belonging to Tenant which cause noise or  vibration that may be transmitted to the structure of the Building, to such a  degree as to be objectionable to Landlord or other tenants, shall be placed  and maintained by Tenant, at Tenant’s expense, on vibration isolators or in  noise-dampering housing or other devices sufficient to eliminate noise or  vibration.  9.All  goods, including material used to store goods, delivered to the Premises of  Tenant shall be immediately moved into the Premises and shall not be left in  parking or receiving areas over night.  10.Tenant  is responsible for the storage and removal of all trash and refuse.  All such trash and refuse shall be  contained in suitable receptacles stored behind screened enclosures at  locations approved by Landlord.  11.Tenant  shall not store or permit the storage or placement of goods or merchandise in  or around the common areas surrounding the Premises.  No displays or sales of merchandise shall  be allowed in the parking lots or other common areas.  12.Tenant  shall not permit any animals, including but not limited to, any household  pets, to be kept in or about the Leased Premises, the Building, the Project  or any of the Common Areas in a manner which violates applicable Laws or in  the Common Areas of the Project in a manner which constitutes a nuisance to  the Common Areas of the Project.   Tenant shall prior to the date such animals are to enter the Leased  Premises and thereafter from time to time upon the request of Landlord  provide to Landlord a written plan for the handling and disposal of all  animals used by Tenant in the conduct of its business, which plan shall be  subject to the reasonable written approval of Landlord.  13.No smoking  shall be permitted in public areas of the Building including without  limitation lobbies, restrooms, balconies, stairwells and fire exist  corridors.  14.Movement  in or out of the Building of furniture, office equipment, or other bulky  material shall be scheduled at least 24 hours in advance with Landlord  regarding the time, method, and routing of such movement.  The tenant is responsible for ensuring  that the moving/delivery company provides a valid Certificate of Insurance to  the Landlord.  15.Landlord  reserves the right to rescind any of these rules and regulations and to make  future rules and regulations required for the safety, protection and  maintenance of the Building, the operation and preservation of the good order  thereof, and the protection and comfort of the tenants and their employees  and visitors.  Such rules and  regulations, when made and written notice thereof given to Tenant, shall be  binding as if originally included herein but shall be subject to the  provisions of Section 5.16 of the Lease.
**EXHIBIT C**

SampleForm ofLease Commencement Certificate

Dated:___________, 2001
Re:That  certain Building Lease (“Lease”), dated _________, 2001, by and between  Woodside Technology Center, LLC (as Landlord) and Deltagen, Inc. (as Tenant),  pursuant to which Tenant has leased the building (“Building”) commonly known  as 740 Bay Road, Redwood City, California 94063, located within the Project  commonly known as Woodside Technology Center.
             Thisis to certify that Woodside Technology Center, LLC has delivered possession ofthe above–referenced Building to Deltagen, Inc. and the following mattersrelated to the Lease:
1.Term  Commencement Date: ____________________ 2.Term  Expiration Date: ________________________ 3.The Lease is in full  force and affect and neither party has any further right to terminate the  Lease pursuant to Section 3.01(c) thereof.
             INWITNESS WHEREOF, the undersigned have executed this Lease CommencementCertificate to be effective as of the date first written above.

 
*LANDLORD:* WOODSIDE TECHNOLOGY CENTER, LLC, a  Delaware limited liability company   By:National  Office Partners Limited Partnership, a  Delaware limited partnership, its  sole member   By:Hines  National Office Partners Limited Partnership,  a  Texas limited partnership,  its  general partner     By:Hines  Fund Management, L.L.C.,   a  Delaware limited liability company,   its  general partner      By:Hines  Interests Limited Partnership,   a  Delaware limited partnership   its  sole member      By:Hines  Holdings, Inc.,   a  Texas corporation,   its  general partner      By:       Its: *TENANT:* DELTAGEN, INC., a  Delaware corporation     By:   Name:   Title:  
**Table of Contents**
  Page ARTICLE 1 Definitions 1.01 “Additional  Rent” 1.02 “Alterations” 1.03 “Base Rent” 1.04 “Building” 1.05 “Building  Operating Cost” 1.06 “Building Operating  Cost Adjustment” 1.07 “Building  Systems” 1.08 “business day” 1.09 “Common Areas” 1.10 “Estimated Building  Operating Cost” 1.11 “Estimated Project  Operating Cost” 1.12 “Fair Market  Rent” 1.13 “Gross Rent” 1.14 “Hazardous  Material” 1.15 “Hazardous Materials Claims” 1.16 “Hazardous  Materials Laws” 1.17 “Landlord  Parties” 1.18 “Laws” 1.19 “LC Face Amount” 1.20 “Leased  Premises” 1.21 “Letter of  Credit” 1.22 “Permitted Hazardous  Materials” 1.23 “Permitted Use” 1.24 “Project” 1.25 “Project  Operating Cost” 1.26 “Rent” 1.27 “Tenant Parties” 1.28 “Tenant’s Proportionate  Share” 1.29 “Term” 1.30 “Term  Commencement Date” 1.31 “Term  Expiration Date” ARTICLE 2 Leased  Premises 2.01 Lease. 2.02 Landlord’s Reserved Rights. ARTICLE 3 Rent, Term, Use and Building  Operating Costs 3.01 Term. 3.02 Use. 3.03 Payment  of Base Rent and Tenant’s Proportionate Share of Estimated Building Operating  Cost. 3.04 Net Lease. 3.05 Project  Operating Cost. 3.06 Allocation of  Building Operating Cost. 3.07 Adjustment  For Variation Between Estimated and Actual. 3.08 Computation  of Building Operating Cost Adjustment. 3.09 Tenant’s  Right To Audit Building Operating Costs. ARTICLE 4 Landlord Covenants 4.01 Landlord’s Repairs  and Maintenance. 4.02 Landlord’s Right To  Perform. 4.03 Graphics  and Signage. 4.04 Peaceful  Enjoyment. ARTICLE 5 Tenant’s Covenants 5.01 Payments By  Tenant. 5.02 Utilities. 5.03 Taxes On  Personal Property and Alterations. 5.04 Repairs By  Tenant. 5.05 Waste. 5.06 Assignment  or Sublease. 5.07 Alterations,  Additions or Improvements. 5.08 Liens. 5.09 Compliance  With Laws, Insurance Standards and Non-Discrimination. 5.10 Entry  For Repairs, Inspection, Posting Notices, Etc. 5.11 No Nuisance. 5.12 Subordination;  Mortgagee Protection; Reciprocal Easement Agreements. 5.13 Estoppel  Certificate. 5.14 Letter of  Credit. 5.15 Tenant’s  Remedies. 5.16 Rules  and Regulations. 5.17 Hazardous  Materials. 5.18 Surrender of  Premises On Termination. 5.19 Window Coverings. 5.20 Tenant’s  Right to Repair. ARTICLE 6 Condition  and Operation of the Building 6.01 As-Is Condition. 6.02 Alteration  of Project. ARTICLE 7 Casualty,  Eminent Domain and Miscellaneous Matters 7.01 Landlord’s  Insurance. 7.02 Liability  Insurance. 7.03 Tenant’s  Casualty Insurance and Additional Tenant Insurance Requirements. 7.04 Indemnity and Exoneration. 7.05 Waiver of Subrogation  Rights. 7.06 Condemnation. 7.07 Damage  and Destruction. 7.08 Default By  Tenant. 7.09 Option  to the Extend the Term At Fair Market Rent. 7.10 No Waiver. 7.11 Statutory  Waivers. 7.12 Holding Over. 7.13 Attorneys’ Fees. 7.14 Amendments. 7.15 Transfers  By Landlord. 7.16 Severability. 7.17 Notices. 7.18 No Option. 7.19 Integration and  Interpretation. 7.20 Quitclaim. 7.21 No Easement For  Light, Air and View. 7.22 No Merger. 7.23 Memorandum  of Lease. 7.24 Survival. 7.25 Financial  Statements. 7.26 No Joint  Venture. 7.27 Successors  and Assigns. 7.28 Applicable Law. 7.29 Time of  the Essence. 7.30 Interpretation. 7.31 Parking. 7.32 Brokers. 7.33 Right of First Opportunity. 7.34 Potential Lease  of Heartport Building. 7.35 Counterpart  Originals.