**Exhibit 10.2**

 

**[English Translation ofOriginal Icelandic Language Document]**

 

# **LEASE AGREEMENT**

 

The undersigned parties, Festingehf., State Reg. No. 550903-4150, of Austurstraeti 17, Reykjavík,(hereinafter referred to as the “Lessor”) and Íslensk erfðagreining ehf., StateReg. No. 691295-3549, of Sturlugata 8, Reykjavik, (hereinafter referred toas the “Lessee”) enter into the following Lease Agreement:

 

**1.0.****                           ****The leased property**

 

1.1                                 The leased property is **Sturlugata 8, Reykjavík** with allappurtenances.  More specifically, theleased property is a research and office building with a total area of 15,228.6square meters including two parking facilities situated on the site.

 

1.2                                 The leased property, on theexecution of this Lease Agreement, is owned by a subsidiary of the Lessee,Vetrargardurinn ehf., State Reg. No. 581201-2490. Concurrently with theexecution of this Lease Agreement, Festing ehf. will buy the leased propertyfrom Vetrargardurinn ehf. pursuant to a separate Purchase Agreement whichconstitutes an integral part hereof.

 

1.3                                 The leased property is described infurther detail as follows in the Public Land Record System:

 
| **Fixed  No.** | ** ** | **Marking** | ** ** | **Use**             | ** ** | **Constr. yr.** | ** ** | **Floor plan**  | ** ** |
|----------------|------------|-------------|------------|---------------------|------------|-----------------|------------|-----------------|------------|
| 225-6085       |       | 01 0101     |       | Research and office |       | 2001            |       | 15,228.6m2 |       |
|           |       | 02 0101     |       | Parking             |       | 2001            |       | 158.2m2    |       |
|           |       | 03 0101     |       | Parking             |       | 2001            |       | 0.0m2      |       |
|           |       | 04 0101     |       | Gas storage         |       |            |       | 0.0m2      |       |

 
| **Land  No.** | ** ** | **Use**                   | ** ** | **Size**         | ** ** | **Geocode**      | ** ** |
|---------------|------------|---------------------------|------------|------------------|------------|------------------|------------|
| 189552        |       | Commerce and service site |       | 18,271.0 m2 |       | 0000-01- 1633501 |       |

 

**2.0.****                           ****Term of lease anddelivery of property**

 

2.1.                              The term of the lease begins on 1 April 2005.The Lease Agreement has a term of 15 years. In the event that the term of thelease ends and the Lessee has not notified the Lessor that he does not intendto renew the lease and no renegotiation has taken place in respect of theproperty six months earlier, the Agreement of the parties will be automaticallyextended on unchanged terms for successive periods of 5 years.

 

2.2.                              The leased property will bedelivered in its physical state as it is on the date of this Lease Agreement.

 

2.3.                              This Lease Agreement cannot beterminated during the term of the lease.

 

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**3.0.****                           ****Condition, deliveryand alteration and maintenance of the leased property**

 

3.1.                              The leased property is ready for useas industrial premises, specially designed for the Lessee. The Lessee isthoroughly familiar with the condition of the lease and has no comments.Fixtures will become the property of the Lessor at the end of the term of thelease, regardless of whether their cost is borne by the Lessor or Lessee.

 

3.2.                              All major alterations that theLessee intends to make in the premises during the term of the lease or itsequipment, apart from changes in the layout of rooms by means of lightpartitions shall be made with the full consent of and in consultation with theLessor. All partitions and fixed interior fittings that the Lessee may installwill become the property of the Lessor without reimbursement. The premisesshall be returned with appurtenances, on the close of the lease period, washedand cleaned and in a condition not worse than at the beginning of the leaseterm, excluding normal wear and tear.

 

3.3.                              The Lessee undertakes to treat theleased property well and to ensure that maintenance of the leased propertyinside and outside is in good order. Failure to meet these obligations willconstitute default on the part of the Lessee.

 

3.4.                              The Lessee will assumeresponsibility for all maintenance of the leased property, both the inner andouter surface. The Lessee undertakes to deliver to the Lessor the leasedproperty in no worse condition at the end of the term of the lease, taking intoaccount, however, the normal use of the real estate and its increasing age.

 

**4.0.****                           ****Lease amount andpayment of rent together with operating cost**

 

4.1.                              The agreed rent is ISK 21,420,000 –twenty-one million four hundred and twenty thousand – per month, adjusted inaccordance with changes in the consumer price index from the base index of April 2005,which is 241.5 points. The calculation of the rent is based on the capitalstructure described in Section 4.3.

 

4.2                                 Rent shall be paid in advance forthree months each time. The due date of rent shall be the first business day ofeach quarter, first on 1 April 2005. The place of payment of the rent is abank account specified by the Lessor. Penalty interest will accrue to unpaidrent from the due date, with no specified final due date. The rent carriesvalue-added tax, which is added to the said amount.

 

4.3                                 The Lessee may submit the requestthat rent falling due after 30 June 2007 should be paid in full or in partin foreign currencies and/or unindexed Icelandic krónur. The Lessee shallnotify the Lessor of such wishes in writing no later than 15 May 2007 andspecify the wishes for the changed currency structure. The Lessee shall pay tothe Lessor all cost outlays of the change in currency structure of the rent,where cost outlays refers to the cost incurred by the Lessor from changing thecurrency of the capital used to fund the leased property. In the event that theLessor is unable to procure the currencies requested by the Lessee, the Lessorand Lessee shall enter into a separate agreement on the details of the relativeproportions of the foreign currencies. In the event that the Lessee requests achange in currency, the amount of

 

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the rent shall be based on thefinancing costs of the Lessor based on the following capital structure,regardless of the actual capital structure of the Lessor.

 

•                  80% loans

•                  20% equity ratio

 

Based on the above capitalstructure, the following financing cost of the Lessor shall be assumed:

 

•                  One-month LIBOR/EURIBOR/REIBOR interest plus 1.85% margin to bank or5.7% fixed index-linked interest in Icelandic krónur, indexed to the consumerprice index in April of 2005.

•                  15% discount rate for equity

 

Taking into account the abovecriteria, rent shall be determined based on the interest rate two business daysprior to the due date of the rent pursuant to the above and based on theexchange rate of currencies on the first business day of each quarter.

 

In the event of changes beingmade in the criteria for the calculation of rent, such changes shall be laiddown in a separate annex to the Lease Agreement, specifying their proportionaldivision at each time and stating the time frame for which capital structure isdetermined.

 

Rent shall be paid in thecurrencies of which the rent is composed at any time.

 

4.4                                 The amount of the rent shall bereviewed as of the due date 1 July 2010. No later than 10 June 2010the Lessor shall notify the Lessee of the adjusted amount of the rent. Theadjustment in the amount of the rent shall reflect the cost of financing therented premises based on the credit terms current in the financial market andthe required rate of return on equity, taking into account the financialposition and results of the Lessee.

 

4.6                                 The Lessee will pay all theoperating costs and all taxes relating to the rented premises. Thus, the Lesseeshall pay for the use of water, electricity and heating costs in the rentedpremises. The Lessee will also pay property tax and all other taxes relating tothe ownership of the leased property.

 

**5.0.****                           ****Sub-lease, right offirst refusal to lease or buy**

 

5.1.                              The Lessee is permitted to sub-leasethe rented property in part to a third party without the consent of the Lessor,provided that the sub-leasing does not in any way prejudice the obligations ofthe Lessee under this Agreement.

 

5.2.                              The Lessee and companies within theconsolidation of the Lessee shall have the right of first refusal to theleasing of the leased property following the end of the term of the lease.

 

5.3.                              The Lessee has the right of firstrefusal to buy the leased property if the Lessor sells it during the term ofthe lease. The Lessor shall invite the Lessee to exercise his right of firstrefusal to buy if the Lessor has received an offer which he intends to accept.The invitation to exercise the right of first refusal shall be submitted bymeans of a written notice accompanied by an agreement containing all terms. TheLessee then has 15 days from the time of delivery of the invitation to exercisethe right of first refusal to decide whether to exercise the right. If theLessee decides to exercise the right of first refusal, the Lessee shall have 30days to finalise a purchase

 

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agreement and pay the purchaseprice on the terms of the invitation to exercise the right of first refusal.

 

**6.0.****                           ****Insurance,guarantees and special termination provisions**

 

6.1.                              The Lessee undertakes to purchaseinsurance from a recognised insurance company, which will cover glass inwindows, appurtenances and interior fittings against water damage, fire etc.The Lessee will also purchase property owner’s insurance for the propertyitself, as well as statutory fire insurance. The Lessor is not liable for anydamage to the property of the Lessee in the leased property resulting fromaccidents such as water damage, fire, smoke, etc., unless and only if theLessor, or parties for which the Lessor is responsible, have caused the damagein a culpable manner. The Lessee shall exercise care as regards fire in thebuilding and ensure that no risk is posed by electrical installations, motorsor other articles which are kept and used in the leased property. The Lessordoes not guarantee delivery of the leased property in a state which meetsregulatory fire prevention requirements in light of the activities conducted inthe building, except in the case of new constructions. The Lessee shall, at hisown cost, undertake all necessary fire prevention measures in the leasedproperty which the fire protection authorities may require as a result of anyalterations that the Lessee makes in the leased property following delivery.The liability of the Lessor for any potential damage suffered by the Lessee isin other respects subject to the general rules of tort.

 

**7.0. Generalprovisions**

 

7.1.                              This Lease Agreement is subject tothe provisions of the Rental Act No. 36/1994, with subsequent amendments,as applicable, to the extent that the obligations and rights of the parties arenot otherwise laid down herein.

 

7.2.                              This Lease Agreement is made in twoidentical copies, one copy to be held by each party.

 

7.3.                              In witness whereof, the Lessor andthe Lessee attach their signatures hereto in the presence of two witnesses.

 

7.4.                              This Agreement is effective as of 1.April 2005.

 

Reykjavík, 29 March 2005

 
|                         | For Festing  ehf.                    |   | For* *Íslensk erfðagreining ehf. |                                |
|------------------------------|--------------------------------------|--------|-------------------------------------------------|-------------------------------------|
|                         |                                 |   |                                            |
|                         |                                 |   |                                            |
|                         |                                 |   |                                            |                                |   |
|                         | Jóhann  Halldórsson [sign] |   |                                            | Tómas Sigurðsson  [sign.] |   |
|                         |                                 |   |                                            |
| Witnesses:                   |                                 |   |
|                         |                                 |   |                                            |
| Ingvi Hrafn Oskarsson [sign] |                                 |   |                                            |
|                         |                                 |   |                                            |
|                              |                                      |        |                                                 |                                     |  |  |  |

 

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By its signature of thisAgreement, Íslandsbanki hf., as the holder of all mortgages secured by therented premises, confirms that the bank has reviewed the substance of theAgreement and for its part consents that the rights of the Lessee pursuant tothis Lease Agreement precede the mortgages of Íslandsbanki in the order ofprecedence of  secured rights, cf. Item11 in Article 28 of Act No. 90/1991.

 

 

Reykjavík, 31 March 2005

 

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