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Exhibit 10.74    
  

	 	 	BUILDING: Ardenwood I-4
	 	 	PROPERTY: 01-0514
	 	 	UNIT: 1
	 	 	LEASE ID: 0514 ABGE01-01

LEASE AGREEMENT  

        THIS LEASE, made this 22nd day of January, 2002 between JOHN ARRILLAGA, Trustee, or his Successor Trustee, UTA dated 7/20/77 (JOHN ARRILLAGA SURVIVOR'S TRUST) as
amended, and RICHARD T. PEERY, Trustee, or his Successor Trustee, UTA dated 7/20/77 (RICHARD T. PEERY SEPARATE PROPERTY TRUST) as amended, hereinafter called Landlord, and ABGENIX, INC., a Delaware
corporation, hereinafter called Tenant. 

WITNESSETH:  

        Landlord hereby leases to Tenant and Tenant hereby hires and takes from Landlord those certain premises (the "Premises") outlined in red on Exhibit "A",
attached hereto and incorporated herein by this reference thereto more particularly described as follows: 

        All
of that certain 50,688+ square foot, one-story building located at 34700 Campus Drive, Fremont, California 94555. Said Premises is more particularly shown
within the area outlined in Red on Exhibit A
attached hereto. The Premises shall include the entire parcel, of which the Building is a part, including exclusive parking appurtenant thereto, as shown within the area outlined in Green on  Exhibit A
attached. The Premises is leased on an "as is" basis, in its present condition, and in the configuration as shown in Red on
Exhibit B to be attached hereto. 

        The
word "Premises" as used throughout this lease is hereby defined to include the nonexclusive use of landscaped areas, sidewalks and driveways in front of or adjacent to the Premises,
and the nonexclusive use of the area directly underneath or over such sidewalks and driveways. The gross leasable area of the building shall be measured from outside of exterior walls to outside of
exterior walls, and shall include any atriums, covered entrances or egresses and covered building loading areas. 

        Said
letting and hiring is upon and subject to the terms, covenants and conditions hereinafter set forth and Tenant covenants as a material part of the consideration for the Lease to
perform and observe each and all of said terms, covenants and conditions. This Lease is made upon the conditions of such performance and observance. 

1.    USE    Tenant shall use the Premises only in conformance with applicable governmental laws, regulations, rules and ordinances
for the purpose of general office, light manufacturing, research and development (including biotechnological research and associated animal research) and storage and other uses as may be necessary or
appropriate for Tenant to conduct Tenant's business, provided that such uses shall be in accordance with all applicable governmental laws and ordinances, and for no other purpose without Landlord's
prior written consent. Tenant shall not do or permit to be done in or about the Premises nor bring or keep or permit to be brought or kept in or about the Premises anything which is prohibited by or
will in any way increase the existing rate of (or otherwise affect) fire or any insurance covering the Premises or any part thereof, or any of its contents, or will cause a cancellation of any
insurance covering the Premises or any part thereof, or any of its contents. Tenant shall not do or permit to be done anything in, on or about the Premises which will in any way obstruct or interfere
with the rights of other tenants or occupants of the Premises or neighboring premises or injure or annoy them, or use or allow the Premises to be used for any improper, immoral, unlawful or
objectionable purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about the Premises. No sale by auction shall be permitted on the Premises. Tenant shall not place any loads
upon 

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the floors, walls or ceiling which endanger the structure, or place any harmful fluids or other materials in the drainage system of the building, or overload existing electrical or other mechanical
systems. No waste materials or refuse shall be dumped upon or permitted to remain upon any part of the Premises or outside of the building in which the Premises are a part, except in trash containers
placed inside exterior enclosures designated by Landlord for that purpose or inside of the building proper where designated by Landlord. No materials, supplies, equipment, finished products or
semi-finished products, raw materials or articles of any nature shall be stored upon or permitted to remain outside the Premises. Tenant shall not place anything or allow anything to be placed near
the glass of any window, door partition or wall which may appear unsightly from outside the Premises. No loudspeaker or other device, system or apparatus which can be heard outside the Premises shall
be used in or at the Premises without the prior written consent of Landlord. Tenant shall not commit or suffer to be committed any waste in or upon the Premises. Tenant shall indemnify, defend and
hold Landlord harmless against any loss, expense, damage, reasonable attorneys' fees, or liability arising out of failure of Tenant to comply with any applicable law relating to Tenant's use of the
Premises or for which
Tenant is otherwise obligated to comply under the terms of this Lease. Tenant shall comply with any covenant, condition, or restriction ("CC&R's") affecting the Premises. The provisions of this
paragraph are for the benefit of Landlord only and shall not be construed to be for the benefit of any tenant or occupant of the Premises. 

2.    TERM*

        A.    The
term of this Lease shall be for a period of TWELVE (12) years TWO (2) months (unless sooner terminated as hereinafter provided) and, subject to Paragraphs 2B and 3,
shall commence on the 1st day of May, 2002 and end on the 30th day of June, 2014. 

        B.    Possession
of the Premises shall be deemed tendered and the term of the Lease shall commence on May 1, 2002, or 

	(d)
	As
otherwise agreed in writing. 

3.    POSSESSION    If Landlord, for any reason whatsoever, cannot deliver possession of said premises to Tenant at the commencement
of the said term, as hereinbefore specified, this Lease shall not be void or voidable; no obligation of Tenant shall be affected thereby; nor shall Landlord or Landlord's agents be liable to Tenant
for any loss or damage resulting therefrom; but in that event the commencement and termination dates of the Lease, and all other dates affected thereby shall be revised to conform to the date of
Landlord's delivery of possession, as specified in Paragraph 2B, above. The above is, however, subject to the provision that the period of delay of delivery of the Premises shall not exceed 60 days
from the commencement date hereof (except those delays caused by Acts of God, strikes, war, utilities, governmental bodies, weather, unavailable materials, and delays beyond Landlord's control shall
be excluded in calculating such period) in which instance Tenant, at its option, may, by written notice to Landlord, terminate this Lease. 

4.    RENT

        A.    Basic Rent. Tenant agrees to pay to Landlord at such place as Landlord may designate without deduction, offset, prior
notice, or demand, and Landlord agrees to accept as Basic Rent for the leased Premises the total sum of FOURTEEN MILLION FOUR HUNDRED THOUSAND FOUR HUNDRED SIXTY AND 80/100 Dollars ($14,400,460.80) in
lawful money of the United States of America, payable as follows: 

        See
Paragraph 39 for Basic Rent Schedule 

	*
	It
is agreed in the event said Lease commences on a date other than the first day of the month the term of the Lease will be extended to account for the number of days in the partial
month. The Basic Rent during the resulting partial month will be pro-rated (for the number of days in the partial month) at the Basic Rent rate scheduled for the projected commencement date as shown
in Paragraph 39. 

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        B.    Time for Payment.    Full monthly rent is due in advance on the first day of each calendar month. In the event
that the term of this Lease commences on a date other than the first day of a calendar month, on the date of commencement of the term hereof Tenant shall pay to Landlord as rent for the period from
such date of commencement to the first day of the next succeeding calendar month that proportion of the monthly rent hereunder which the number of days between such date of commencement and the first
day of the next succeeding calendar month bears to thirty (30). In the event that the term of this Lease for any reason ends on a date other than the last day of a calendar month, on the first day of
the last calendar month of the term hereof Tenant shall pay to Landlord as rent for the period from said first day of said last calendar month to and including the last day of the term hereof that
proportion of the monthly rent hereunder which the number of days between said first day of said last calendar month and the last day of the term hereof bears to thirty (30). 

        C.    Late Charge.    Notwithstanding any other provision of this Lease, if Tenant is in default in the payment of
rental as set forth in this Paragraph 4 when due, or any part thereof, Tenant agrees to pay Landlord, in addition to the delinquent rental due, a late charge for each rental payment in default
ten (10) days. Said late charge shall equal ten percent (10%) of each rental payment so in default. 

        D.    Additional Rent.    Beginning with the commencement date of the term of this Lease, Tenant shall pay to Landlord
or to Landlord's designated agent in addition to the Basic Rent and as Additional Rent the following: 

	(a)
	All
Taxes relating to the Premises as set forth in Paragraph 9, and

	(b)
	All
insurance premiums and deductibles relating to the Premises, as set forth in Paragraph 12, and

	(c)
	All
charges, costs and expenses, which Tenant is required to pay hereunder, together with all interest and penalties, costs and expenses including reasonable attorneys' fees and legal
expenses, that may accrue thereto in the event of Tenant's failure to pay such amounts, and all damages, reasonable costs and expenses which Landlord may incur by reason of default of Tenant or
failure on Tenant's part to
comply with the terms of this Lease. In the event of nonpayment by Tenant of Additional Rent, Landlord shall have all the rights and remedies with respect thereto as Landlord has for nonpayment of
rent, and

	(d)
	all
prorated costs and expenses related to the Ardenwood Property Owners' Association as set forth in Paragraph 44. 

        The
Additional Rent due hereunder shall be paid to Landlord or Landlord's agent (i) within five business days for taxes and insurance and within thirty days for all other
Additional Rent items after presentation of invoice from Landlord or Landlord's agent setting forth such Additional Rent and/or (ii) at the option of Landlord, Tenant shall pay to Landlord
monthly, in advance, Tenant's prorata share of an amount estimated by Landlord to be Landlord's approximate average monthly expenditure for such Additional Rent items, which estimated amount shall be
reconciled within 120 days of the end of each calendar year or more frequently if Landlord elects to do so at Landlord's sole and absolute discretion as compared to Landlord's actual expenditure for
said Additional Rent items, with Tenant paying to Landlord, upon demand, any amount of actual expenses expended by Landlord in excess of said estimated amount, or Landlord crediting to Tenant
(providing Tenant is not in default in the performance of any of the terms, covenants and conditions of this Lease) any amount of estimated payments made by Tenant in excess of Landlord's actual
expenditures for said Additional Rent items. Within thirty (30) days after receipt of Landlord's reconciliation, Tenant shall have the right, at Tenant's sole expense, to audit, at a mutually
convenient time at Landlord's office, Landlord's records relating to the foregoing expenses. Such audit must be conducted by Tenant or an independent nationally recognized accounting firm that is not
being compensated by Tenant or other third party on a 

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contingency fee basis. If such audit reveals that Landlord has overcharged Tenant, the amount overcharged shall be credited to Tenant's account within thirty (30) days after the audit is concluded. 

        E.    Fixed Management Fee.    Beginning with the Commencement Date of the Term of this Lease, Tenant shall pay to
Landlord or Landlord's Assignee, in addition to the Basic Rent and Additional Rent, a fixed monthly management fee ("Management Fee") equal to one and one-half percent (1.5%) of the Basic Rent due for
each month during the Lease Term. 

        The
respective obligations of Landlord and Tenant under this paragraph shall survive the expiration or other termination of the term of this Lease, and if the term hereof shall expire or
shall otherwise terminate on a day other than the last day of a calendar year, the actual Additional Rent incurred for the calendar year in which the term hereof expires or otherwise terminates shall
be determined and settled on the basis of the statement of actual Additional Rent for such calendar year and shall be prorated in the proportion which the number of days in such calendar year
preceding such expiration or termination bears to 365. 

        F.    Place of Payment of Rent and Additional Rent.    All Basic Rent hereunder and all payments hereunder for
Additional Rent shall be paid to Landlord at the office of Landlord at PEERY/ARRILLAGA, FILE 1504, BOX 60000, SAN FRANCISCO, CA 94160 or to such other person or to such other place as Landlord may
from time to time designate in writing. 

        G.    Security Deposit.    Concurrently with Tenant's execution of this Lease, Tenant shall deposit with Landlord the
sum of ONE HUNDRED TWENTY-EIGHT THOUSAND SEVEN HUNDRED FIFTY-ONE AND NO/100 Dollars ($128,571.00). Said sum shall be held by Landlord as a Security Deposit for the faithful performance by Tenant of
all of the terms, covenants, and conditions of this Lease to be kept and performed by Tenant during the term hereof. If Tenant defaults with respect to any provision of this Lease, including, but not
limited to, the provisions relating to the payment of rent and any of the monetary sums due herewith, Landlord may (but shall not be required to) use, apply or retain all or any part of this Security
Deposit for the payment of any other amount which Landlord may spend by reason of Tenant's default or to compensate Landlord for any other loss or damage which Landlord may suffer by reason of
Tenant's default. If any portion of said Deposit is so used or applied, Tenant shall, within ten (10) days after written demand therefor, deposit cash with Landlord in the amount sufficient to restore
the Security Deposit to its original amount. Tenant's failure to do so shall be a material breach of this Lease. Landlord shall not be required to keep this Security Deposit separate from its general
funds, and Tenant shall not be entitled to interest on such Deposit. If Tenant fully and faithfully performs every provision of this Lease to be performed by it, the Security Deposit or any balance
thereof shall be returned to Tenant (or at Landlord's option, to the last assignee of Tenant's interest hereunder) at the expiration of the Lease term and after Tenant has vacated the Premises. In the
event of termination of Landlord's interest in this Lease, Landlord shall transfer said Deposit to Landlord's successor in interest whereupon Tenant agrees to release Landlord from liability for the
return of such Deposit or the accounting therefor. 

5.    ACCEPTANCE AND SURRENDER OF PREMISES    Be entry hereunder Tenant accepts the Premises as being in good and sanitary order,
condition and repair and accepts the building and improvements included in the Premises in their present condition and without representation or warranty by Landlord as to the condition of such
building or as to the use of occupancy which may be made thereof. Any exceptions to the foregoing must be by written agreement executed by Landlord and Tenant. Tenant agrees on the last day of the
Lease term or on the sooner termination of this Lease. To surrender the Premises promptly and ocaceably to Landlord in good condition and repair (damage by Acts of God, fire and other causes for which
Tenant does not have the obligation to repair under the other provisions of this Lease, and normal wear and tear excepted), with all interior walls painted, or cleaned so that they appear freshly
painted, and repainted, and repaired or replaced, if damaged; all floors cleaned and waved; all carpets cleaned and shampooed; all broken, marred or nonconforming acoustical ceiling files replaced;
all windows washed; the air conditioning and heating systems serviced 

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by a reputable and licensed service firm and in good operating condition and repair; the plumbing and electrical systems and lighting in good order and repair, including replacement of any burned out
or ballast; the lawn and shrubs in good condition including the replacement of any dead or damaged plantings; the sidewalk, driveways and parking areas in good order, condition and repair; together
with all alterations, additions, and improvements which may have been made in, to, or on the Premises (except moveable trade fixtures installed at the expense of Tenant) except that Tenant shall
ascertain from Landlord within thirty (30) days before the end the term of this Lease whether Landlord desires
to have the Premises or any part or parts thereof restored to their condition and configuration as when the Premises were delivered to Tenant and if Landlord shall so desire, then Tenant shall restore
said Premises or such part or parts thereof before the end of this Lease at Tenant's sole cost and expense. Notwithstanding the above, Tenant shall not be required to remove such interior improvements
shown on Exhibit B to this Lease. Tenant on or before the end of the term or sooner termination of this Lease, shall remove all of Tenant's personal property and trace fixtures from the
Premises, and all property not so removed on or before on or before the end of the term or sooner termination of this Lease shall be deemed abandoned by Tenant and to same shall thereupon pass to
Landlord without compensation to Tenant. Landlord may, upon termination of this Lease, remove all moveable furniture and equipment so abandoned by Tenant, at Tenant's sole cost, and repair any damage
caused by such removal at Tenant's sole cost. If the Premises be not surrendered at the end of the term or sooner termination of this Lease. Tenant shall indemnify Landlord against loss or liability
resulting from the delay by Tenant in so surrendering the Premises including, without limitation, any claims made by any successful Tenant founded on such delay. Nothing contained herein shall be
construed as an extension of the term hereof or as a consent of Landlord to any holding given by Tenant. The voluntary or other surrender of this Lease or the Premises by Tenant or a mutual
cancellation of this Lease shall not work as a merger and. all the option of Landlord, shall either terminate all or any existing subleases or subleases or operate as an assignment to Landlord of all
or any such subleases or subtenancies. 

6.    ALTERATIONS AND ADDITIONS    Tenant shall not make, or suffer to be made, any alteration or addition to the Premises, or any
part thereof, without the written consent of Landlord first had and obtained by Tenant (such consent not to be unreasonably withheld), but at the cost of the Tenant, and any addition to or allocation
of the Premises, except moveable furniture and trade fixtures, shall at once become a part of the Premises and upon Termination of this Lease belong to Landlord. Landlord reserves the right to approve
all contracts and mechanics proposed by Tenant to make such alterations and additions which approval shall not be unreasonably withheld. Tenant shall retain little to all moveable furniture and trade
fixtures placed in the Premises. All heating, lighting, electrical, air conditioning, floor to ceiling partitioning, drapery, carpeting, and floor installations made by Tenant, together with a
property that has become an integral part of the Premises, shall not be deemed trade failure. Tenant agrees that it will not proceed to make such alteration or additions, without having obtained
consent from Landlord to do so, and until five (5) days from the receipt of such consent. In order that Landlord may post appropriate notices to avoid any liability to contracts or materials suppliers
for payment for Tenant's improvements. Tenant will at all times permit such notices to be posted and to remain posted until the completion of work, Tenant shall, if required by Landlord, secure at
Tenant's own cost and expense, a completion and man indemnity band, satisfactory to Landlord, for such work. Tenant further covenants and agrees that any mechanic's lien filed against the Premises for
work claimed to have been done for, or materials claimed to have been furnished to Tenant, will be discharged by Tenant, by band or otherwise, within ten (10) days after notice of the filing thereof,
at the cost and expense of Tenant. Any excepting to the foregoing must be made in writing and executed by both Landlord and Tenant. 

7.    TENANT MAINTENANCE    Subject to the provisions of Paragraph 21, Tenant shall, at its sole cost and expense, keep and
maintain the Premises (including appurtenances) and every part thereof in a-high standard of maintenance and repair, or replacement,an in good and sanitary condition. Tenant's maintenance and repair
responsibilities herein referred to include, but are not limited to, amortization, 

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all windows (interior and exterior), window frames, plate glass and glazing (destroyed by accident or act of third parties), truck doors, plumbing systems (such as water and drain lines, sinks,
toilets, faucets,
drains, showers and water fountains), electrical systems (such as panels, conduits, outlets, lighting fixtures, lamps, bulbs, tubes, and ballasts), heating and air conditioning systems (such as
compressors, fans, air handlers, ducts, mixing boxes, thermostats, time clocks, boilers, heaters, supply and return grills), structural elements and exterior surfaces of the building, store fronts,
roofs, downspouts, all interior improvements within the premises including but not limited to wall coverings, window coverings, carpet, floor coverings, partitioning, ceilings, doors (both interior
and exterior), including closing mechanisms, latches, locks, skylights (if any), automatic fire extinguishing systems, and elevators and all other interior improvements of any nature whatsoever, and
all exterior improvements including but not limited to landscaping, sidewalks, driveways, parking lots including striping and seating, sprinkler systems, lighting, ponds, fountains, waterways, and
drains. Tenant agrees to provide carpet shields under all rolling chairs or to otherwise be responsible for wear and tear of the carpet caused by such rolling chairs if such wear and tear excess that
caused by normal tool traffic in surrounding areas. Areas of excessive wear shall be replaced all Tenant's sole expense upon Lease termination. Tenant hereby waives all rights under, and benefits of,
Subsection 1 of Section 1932 and Section 1341 and 1942 of the California Civil Code and under any similarities law, statute or ordinance now or hereafter in effect. In the event any of the above
maintenance responsibilities apply to any other tenant(s) of Landlord where there is common usage with other tenant(s), such maintenance responsibilities and charges shall be allocated to the leased
Premises by square footage or other equitable and determined by Landlord. 

8.    UTILITIES    Tenant shall pay promptly, as the same become due, all charged for water, gas, electricity, telephone, telex and
other electronic communication service, sewer service, waste pick-up and any other Utilities, materials or services furnished directly to or used by Tenant or about the Premises during the term of
this Lease, including, without limitation, any temporary or permanent utility surcharge or other exactinos whether or not hereinafter imposed. In the event the above charges apply in any other
tenant(s) of Landlord where there is common usage with other tenant(s), such charges shall be allocated to the leased Premises by square footage or other equitable basis as calculated and determined
by Landlord. 

        Landlord
shall not be liable for and Tenant shall not be entitled to any abatement or reduction of rent by reason of any interruption or failure of utility services in the Premises when
such interruption or failure is caused by accident, breakage, repair, strikes, lockouts, or other labor disturbances or labor disputes of any nature, or by any other cause, similar or dissimilar,
beyond the reasonable control of Landlord. 

9.    TAXES

        A.    As
Additions Rent and in accordance with Paragraph 4D of this Lease, Tenant shall pay to Landlord, or if Landlord so directs, directly to the Tax Collector, all Real
Property Taxes relating to the Premises accruing with respect to the Premises during the Term of this Lease. In the event the Premises leased hereunder consists of only a portion of the entire tax
parcel, Tenant shall pay to Landlord as they become due Tenant's proportionate share of such real estate taxes allocated to the leased Premises by square footage or other reasonable basis as
calculated and determined by Landlord, if the tax billing partains 100% to the leased Premises, and Landlord chooses to have Tenant pay said real estate taxes directly to the Tax Collector, then in
such event it shall be the responsibility of Tenant to obtain the tax and assessment bills and pay, prior to delinquency, the applicable real property taxes and assessments
pertaining to the leased Premises, and failure to receive a bill for taxes and/or assessments shall not provide a basis for cancellation of or nonresponsibility for payment of penalties for nonpayment
or late payment by Tenant. The term "Real Property Taxes", as used herein, shall mean (i) all taxes, assessments, levies and other charges of any kind or nature whatsoever, general and special,
foreseen and unforeseen (including all installations of principal and interest required to pay any general special assessments for public improvements and any increases resulting from reassessments 

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caused by any change in ownership of the Premises) now or hereafter imposed by any governmental or quasi-governmental authority or special district having the direct or indirect power to tax or levy
assessments, which are levied or assessed against, or with respect to the value, occupancy or use of, all or any portion of the Premises (as now constructed or as may at any time hereafter be
constructed, altered, or otherwise changed) or Landlord's interest therein; any improvements located within the Premises (regardless of ownership); the failures, equipment and other property of
Landlord, neat or personal, that are an integral part if located in the Premises; or parking areas, public utilities, or energy within the Premises; (ii) all charges, levies or fees imposed by reason
of environmental regulation or other governmental control of the Premises, excluding any taxes related to on-site Hazardous Materials contamination which Tenant did not cause or contribute to; and
(iii) all costs and fees (including reasonable attorneys' fees) incurred by Landlord in reasonably contesting any Real Property Tax and in negotiating with public authorities as to any Real Property
Tax, if at any time during the term of this Lease the taxation or assessment of the Premises prevailing as of the commencement date of this Lease shall be altered so that in lieu of or in addition to
any Real Property Tax described above there shall be levied, assessed or imposed (whether by reason or change in the method of taxation or assessment, creation of a new tax exchange, or any other
cause) an alternate or additional tax or charge (i) on the value, use or occupancy of the Premises of Landlord's interest therein or (ii) on or measured by the gross receipts, income or rentals from
the Premises, on Landlord's business of leasing the Premises, or computed in any manner with respect to the Premises, then any such tax or charge, however designatee shall be included within the
meaning of the term "Real Property Taxes" for purposes of this Lease, if any Real Property Tax is based upon property or rents unrelated to the Premises, then only that part of such Real Property Tax
that is fairly allocable to the Premises shall be included within the meaning of the term "Real Property Taxes". Notwithstanding the foregoing, the term "Real Property Taxes" shall not include estate,
inheritance, gift or franchise fares of Landlord or the federal or state net income tax imposed on Landlord's income from all sources or other personal taxes measured by the net income (as
distinguished from gross income) of Landlord from the leasing of the Premises either separately or together with other property. SEE PARAGRAPH 46 

        B.    Taxes on Tenant's Property    Tenant shall be liable for and shall pay ten days before delinquency, taxes levied
against any personal property or trade fixtures placed by Tenant in or about the Premises. If any such taxes on Tenant's personal property or trade fixtures are levied against Landlord or Landlord's
property or if the assessed value of the Premises is increased by the inclusion therein of a value placed upon personal property or trade fixtures Tenant and if Landlord, after written notice to
Tenant, pays the taxes based on such increased assessment, which Landlord shall have the right to do regardless of the validity thereof, but only under proper protest if requested by Tenant, Tenant
shall within ten (10) days after demand, as the case may be, repay to Landlord the taxes so levied against Landlord, or the proportion of such taxes resulting from such increase in the assessment;
provided that in any such event Tenant shall have the right. In the name of Landlord and with Landlord's full cooperation, to bring suit in any court of competent jurisdiction to recover the amount of
such taxes so paid under protest, and any amount so recovered shall belong to Tenant. 

10.    LIABILITY INSURANCE    Tenant, at Tenant's expense, agrees to keep in force during the term of this Lease's policy of
commercial general liability insurance with combined single limit coverage of not less than Two Million Dollars ($2,000,000), per occurrence for bodily injury and property damage occurring in, on or
about the Premises, including parking and landscaped areas. Such insurance shall be primary and noncontributary as respects any insurance carried by Landlord. The policy or policies effecting such
insurance shall name Landlord as additional insureds, and shall insure any liability of Landlord, contingent or otherwise; as respects acts or omission of Tenant. Its agents, employees or invitees or
otherwise by any conduct or transactions of any of said persons in or about or concerning the Premises including any failure of Tenant to observe or perform any of its obligations hereunder; shall be
issued by an insurance company admitted to transact business in the State of California; and shall provide that the insurance effected thereby shall not be canceled, except upon thirty (30) days 

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prior written notice to Landlord. A certificate of insurance said policy shall be delivered to Landlord. If, during the term of this Lease, in the considered opinion of Landlord's Lender, Insurance
advisor, or counsel, the amount of Insurance described in this Paragraph 10 is not adequate, Tenant agrees to increase said coverage to such reasonable amount as Landlord's Lender, insurance advisor,
or counsel shall deem adequate. 

11.    TENANT'S PERSONAL PROPERTY INSURANCE AND WORKMAN'S COMPENSATION INSURANCE    Tenant shall maintain a policy or policies of
fire and property damage insurance in "all risk" form with a sprinkler leakage endorsement ensuring the personal property, inventory, trade fixtures, and leasehold improvements within the leased
Premises for the full replacement value thereof. The proceeds from any of such policies shall be used for the repair or replacement of such items so insured. 

        Tenant
shall also maintain a policy or policies of workman's compensation insurance and any other employee benefit insurance sufficient to comply with all laws. 

12.    PROPERTY INSURANCE    Landlord shall purchase and keep in force, and as Additional Rent and in accordance with Paragraph 4D
of this Lease. Tenant shall pay to Landlord (or Landlord's agent of so directed by Landlord) Tenant's proportional share (allocated to the leased Premises by square footage or other equitable basis as
calculated and determined by Landlord) of the deductibles on insurance claims and the cost of, policy of policies of insurance covering loss or damage to the Premises (excluding routine maintenance
and repairs and incidental damage or destruction caused by accidents or vandalism for which Tenant is responsible under Paragraph 7) in the amount of the full replacement value thereof, providing
protection against those parts included within the classification of "all risks" insurance and flood and/or earthquake insurance. If available, plus a policy of rental income insurance in the amount
of one hundred (100%) percent of twelve (12) months Basic Rent, plus sums paid as Additional Rent, if such insurance cost is increased due to Tenant's use of the Premises, Tenant agrees to pay to
Landlord the full cost of such increase. Tenant shall have no interest in nor any right to the proceeds of any insurance procured by Landlord for the Premises. 

        Landlord
and Tenant do each hereby respectively release the other, to the extent of insurance coverage of the releasing party, from any liability for less or damage caused by fire or any
of the extended
coverage casualties included in the releasing party's insurance policies. Irrespective of the cause of such fire or casualty; provided, however, that if the insurance policy of either releasing party
prohibits such waiver, then this waiver shall not take effect until consent to such waiver is obtained. If such waiver is so prohibiting, the insured party affected shall promptly notify the other
party thereof. 

13.    INDEMNIFICATION    Landlord shall not be liable to Tenant and Tenant hereby waives all claims against Landlord for any injury
to or death any person or damage to or destruction of property in or about the Premises by or from any cause whatsoever, including, without limitation, gas, fire, oil, electricity or leakage of any
character from the roof, walls, basement or other portions of the Premises but excluding, however, the willful misconduct or negligence of Landlord, its agents, servants, employees, invitees, or
contractors of which negligence Landlord has knowledge and reasonable time to correct. Except as to injury to persons or damage to property to the extent arising from the willful misconduct or the
negligence of Landlord, its agents, servants, employees, invitees, or contractors, Tenant shall hold Landlord harmless from and defend Landlord against any and all expenses, including reasonable
attorney's fees. In connection therewith, arising out of any injury to or death of any person or damage to or destruction or property occurring in, on or about the Premises, of any part thereof, from
any causes whatsoever. 

14.    COMPLIANCE    Tenant, at its sole cost and expense, shall promptly comply with all laws, statutes, ordinances and
governmental rules, regulations of its agents, servants, employees, invitees, or contractors requirements now or hereafter in effect; with the requirements of any board of fire underwriters or other
similar body now or hereafter constituted; and with any direction or occupancy certificate issued pursuant to law by any public officer, provided, however, that no such failure shall be 

8

 

deemed a breach of the provisions. If Tenant, immediately upon notification, commences to remedy or rectify said failure. The judgement of any court of competent jurisdiction or the admission of
Tenant in any action against Tenant, whether Landlord be a party thereto or not, that Tenant has violated any such law, statute, ordinance or governmental rule, regulation, requirement, direction or
provision, shall be conclusive of that fact as between Landlord and Tenant. Tenant shall, at its sole cost and expense, comply with any and all requirements pertaining to said Premises, of any
insurance organization or company, necessary for the maintenance of reasonable fire and public liability insurance covering requirements pertaining to said Premises. 

15.    LIENS    Tenant shall keep the Premises free from any liens arising out of any work performed, materials furnished or
obligation incurred by Tenant, in the event that Tenant shall not, within ten (10) days following notice of the imposition of such lien, cause the same to be released of record. Landlord shall have,
in addition to all other remedies provided herein and by law, the right (after two days written notice), but no obligation, to cause the same to be released by such means as if shall deem proper,
including payment of the claim giving rise to such lien. All sums paid by Landlord for such purpose, and all expense incurred by it in connection therewith, shall be payable to Landlord by Tenant on
demand with interest at the prime rate of interest as quoted by the Bank of America. 

16.    ASSIGNMENT AND SUBLETTING    Tenant shall assign, transfer, or hypothecate the leasehold estate under this Lease, of any
interest therein, and shall not sublet the Premises,or any part thereof, or any
right or privilege appurtenant thereto, or suffer any other person or entity to occupy or use the Premises, or any portion thereof, without, in increase, the prior written consent of Landlord which
consent will not be unreasonably withheld. As a condition for granting this consent to any assignment, transfer, or subletting. Landlord may require that Tenant agrees to pay to Landlord, as
Additional Rent, twenty-five percent (25%) of all rents or additional consideration received by Tenant from its assignees, transferees, or subleasees in excess of the Rent payable by Tenant to
Landlord hereunder ("Excess Rent"); provided, however, that before sharing such Excess Rent, Tenant shall first be entitled to recover from such Excess Rent (i) the amount of any reasonable leasing
commissions paid by Tenant to third parties not affiliated with Tenant and (ii) Tenant's unamortized costs, excluding costs of interest (if any), to construct interior improvements in the area being
sublet for said subtenant(s). Tenant shall, by thirty (30) days written notice, advice Landlord of its intent to assign or transfer Tenant's interest in the Lease or sublet the Premises or any portion
thereof for any part of the term hereof. Within thirty (30) days after receipt of said written notice, Landlord may, in its sole discretion elect to terminate this Lease as to the portion of the
Premises described in Tenant's notice on the date specified in Tenant's notice by giving written notice of such election to terminate (provided Tenant intends to sublet 50% or more of the Premises) If
no such notice to terminate is given to Tenant within said thirty (30) day period. Tenant may proceed to locate an acceptable sublease, assignor, or other transfer for presentment to Landlord for
Landlord's approval, all in accordance with the lease, covenant and condition of this paragraph 16. If Tenant intends to sublet Premises and Landlord elects to terminate this Lease, this Lease shall
be terminated on the date specified in Tenant's notice. If, however, this Lease shall terminate pursuant to the foregoing with respect to less than all the Premises, the rent as defined and reserved
hereinabove shall be adjusted on a pro rata basis to the number of square feet retained by Tenant, and this Lease as so amended shall continue in full force and effect. In the event Tenant is allowed
to assign, transfer or sublet the whole or any part of the Premise, with the prior written consent of Landlord, no assignee, transferee or subtenant shall assign or transfer this Lease, either in
whole or in part, or sublet the whole or any part of the Premises without having obtained prior written consent of Landlord which consent shall not be unreasonably withheld. A consent of Landlord to
one assignment, transfer, hypothecation, subletting, occupation or use without such consent shall be void and shall constitute a breach of this Lease by Tenant and shall, if the option of Landlord
exercised by written notice to Tenant, terminate this Lease. The leasehold estate under this Lease shall not shall any interest therein, be assignable for any purpose by operation of law without the
written consent of Landlord which consent shall not be unreasonably withheld. As a condition to its consent, 

9

 

Landlord may require Tenant to pay all expenses in connection with the assignment, and Landlord may require Tenant's assignee or transferee (or other assignees or transferees) to assume in writing
all of the obligations under this Lease and for Tenant to remain liable to Landlord under the Lease. SEE PARAGRAPH 42 

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   17.    SUBORDINATION AND MORTGAGES    In the event Landlord's title or leasehold interest is now or hereafter encumbered by a deed
of trust, upon the interest of Landlord in the land and buildings in which the demised Premises are located, to secure a loan from a lender thereinafter referred to as "Lender" to Landlord, Tenant
shall, at the request of Landlord or Lender, execute in writing an agreement (in form reasonably acceptable to Tenant) subordinating its rights under this Lease to the lien of such deed of trust, or,
if so requested, agreeing that the lien of Lender's deed of trust shall be or remain subject and subordinate to the rights of Tenant under this Lease. Notwithstanding any such subordination, Tenant's
possession under this Lease shall not be disputed if Tenant is not in default and so long as Tenant shall pay all rent and observe and perform all of the provisions set forth in this Lease and any
Subordination agreement shall reflect the agreement of the Lender to the same. SEE PARAGRAPH 47 

18.    ENTRY BY LANDLORD    Landlord reserves, and shall at all reasonable times after at least 24 hours notice (except in
emergencies) have, the right to enter the Premises to inspect them; to perform any services to be provided by Landlord hereunder; to make repairs or provide any services to a contiguous tenant(s); to
submit the Premises to prospective purchasers, mortgagors or tenants; to post notices of nonresponsibility; and to alter, improve or repair the Premises or other parts of the building, all without
abatement of rent, and may erect scaffolding and other necessary structures in or through the Premises where reasonably required by the character of the work to be performed provided, however that the
business of Tenant shall be interfered with to the least extent that is reasonably practical. Any entry to the Premises by Landlord for the purposes provided for herein shall not under any
circumstances be construed or deemed to be a forcible or unlawful entry into or a detainer of the Premises or an eviction, actual or constructive, of Tenant from the premises or any portion thereof. 

19.    BANKRUPTCY AND DEFAULT    The commencement of a bankruptcy action or liquidation action or reorganization action or
insolvency action or an assignment of or by Tenant for the benefit of creditors, or any similar action undertaken by Tenant, or the insolvency of Tenant, shall, at Landlord's option, constitute a
breach of this Lease by Tenant. If the trustee or receiver appointed to serve during a bankruptcy, liquidation, reorganization, insolvency or similar action elects to reject Tenant's unexpired Lease,
the trustee or receiver shall notify Landlord in writing of its election within thirty (30) days after an order for relief in a liquidation action or within thirty (30) days after the commencement of
any action. 

        Within
thirty (30) days after court approval of the assumption of this Lease, the trustee or receiver shall cure (or provide adequate assurance to the reasonable satisfaction of Landlord
that the trustee or receiver shall cure) any and all previous defaults under the unexpired Lease and shall compensate Landlord for all actual pecuniary loss and shall provide adequate assurance of
future performance under said Lease to the reasonable satisfaction of Landlord. Adequate assurance of future
performance, as used herein, includes, but shall not be limited to: (i) assurance of source and payment of rent, and other consideration due under this Lease; (ii) assurance that the
assumption or assignment of this Lease will not breach substantially any provision, such as radius, location, use, or exclusivity provision, in any agreement relating to the above described Premises. 

        Nothing
contained in this section shall affect the existing right of Landlord to refuse to accept an assignment upon commencement of or in connection with a bankruptcy, liquidation,
reorganization or insolvency action or an assignment of Tenant for the benefit of creditors or other similar act. Nothing contained in this Lease shall be construed as giving or granting or creating
an equity in the demised Premises to Tenant. In no event shall the leasehold estate under this Lease, or any interest therein, be assigned by voluntary or involuntary bankruptcy proceeding without the
prior written consent of Landlord. In no event shall this Lease or any rights or privileges hereunder be an asset of Tenant under any bankruptcy, insolvency or reorganization proceedings. 

10

 

        The
failure to perform or honor any covenant, condition or representation made under this Lease shall constitute a default hereunder by Tenant upon expiration of the appropriate grace
period hereinafter provided. Tenant shall have a period of five (5) business days from the date of written notice from Landlord within which to cure any default in the payment of rental or adjustment
thereto. Tenant shall have a period of thirty (30) days from the date of written notice from Landlord within which to cure any other default under this Lease; provided, however, that if the nature of
Tenant's failure is such that more than thirty days is reasonably required to cure the same, Tenant shall not be in default so long as Tenant commences performance within such thirty day period and
thereafter prosecutes the same to completion. 

        Upon
an uncured default of this Lease by Tenant, Landlord shall have the following rights and remedies in addition to any other rights or remedies available to Landlord at law or in
equity: 

        (a)  The
rights and remedies provided for by California Civil Code Section 1951.2, including but not limited to, recovery of the worth at the time of award of the
amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of rental loss for the same period that Tenant proves could be reasonably avoided, as computed
pursuant to subsection (b) of said Section 1951.2. Any proof by Tenant under subparagraphs (2) and (3) of Section 1951.2 of the California Civil Code of the amount of rental loss that
could be reasonably avoided shall be made in the following manner: Landlord and Tenant shall each select a licensed real estate broker in the business of renting property of the same type and use as
the Premises and in the same geographic vicinity. Such two real estate brokers shall select a third licensed real estate broker, and the three licensed real estate brokers so selected shall determine
the amount of the rental loss that could be reasonably avoided from the balance of the term of this Lease after the time of award. The decision of the majority of said licensed real estate brokers
shall be final and binding upon the parties hereto. 

        (b)  The
rights and remedies provided by California Civil Code Section which allows Landlord to continue the Lease in effect and to enforce all of its rights and remedies
under this Lease, including the right to recover rent as it becomes due, for so long as Landlord does not terminate Tenant's right to possession; acts of maintenance or preservation, efforts to relet
the Premises, or the appointment of a receiver upon Landlord's initiative to protect its interest under this Lease shall not constitute a termination of Tenant's right to possession. 

        (c)  The
right to terminate this Lease by giving notice to Tenant in accordance with applicable law. 

        (d)  To
the extent permitted by law the right and power, to enter the Premises and remove therefrom all persons and property, to store such property in a public warehouse or
elsewhere at the cost of and for the account of Tenant, and to sell such property and apply such proceeds therefrom pursuant to applicable California law, Landlord may from time to time sublet the
premises or any part thereof for such term or terms (which may extend beyond the term of this Lease) and at such rent and such other terms as Landlord in its reasonable sole discretion may deem
advisable, with the right to make alterations and repairs to the Premises. Upon each subletting, (i) Tenant shall be immediately liable to pay Landlord, in addition to indebtedness other than
rent due hereunder, the reasonable cost of such subletting, including, but not limited to, reasonable attorneys' fees, and any real estate commissions actually paid, and the cost of such reasonable
alterations and repairs incurred by Landlord and the amount, if any, by which the rent hereunder for the period of such subletting (to the extent such period does not exceed the term hereof) exceeds
the amount to be paid as rent for the Premises of such period or (ii) at the option of Landlord, rents received from such subletting shall be applied first to payment of indebtedness other
than rent due hereunder from Tenant to Landlord; second, to the payment of any costs of such subletting and of such alterations and repairs; third to payment of rent due and 

11

 

unpaid hereunder; and the residue, if any, shall be held by Landlord and applied in payment of future rent as the same becomes due hereunder. If Tenant has been credited with any rent to be received
by such subletting under option (i) and such rent shall not be promptly paid to Landlord by the subtenant(s), or if such rentals received from such subletting under option (ii) during
any month be less than that to be paid during that month by Tenant hereunder, Tenant shall pay any such deficiency to Landlord. Such deficiency shall be calculated and paid monthly. No taking
possession of the Premises by Landlord shall be construed as an election on its part to terminate this Lease unless a written notice of such intention be given to Tenant. Notwithstanding any such
subletting without termination, Landlord may at any time hereafter elect to terminate this Lease for such previous breach. 

        (e)  The
right to have a receiver appointed for Tenant upon application by Landlord, to take possession of the Premises and to apply any rental collected from the premises
and to exercise all other rights and remedies granted to Landlord pursuant to subparagraph d above. 

20.    ABANDONMENT    Tenant shall not vacate or abandon the Premises at any time during the term of this Lease (except that Tenant
may vacate so long as it pays Rent, provides a security service to check the Premises during normal business hours from Monday to Friday, and otherwise performs its obligations hereunder) and if
Tenant shall abandon, vacate or surrender said Premises, or be
dispossessed by the process of law, or otherwise, any personal property belonging to Tenant and left on the Premises shall be deemed to be abandoned, at the option of Landlord, except such property as
may be mortgaged to Landlord. 

21.    DESTRUCTION    In the event the Premises are destroyed in whole or in part from any cause, except for routine maintenance and
repairs and incidental damage and destruction or caused from vandalism and accidents for which Tenant is responsible under Paragraph 7, Landlord may, at its option: 

        (a)  Rebuild
or restore the Premises to their condition prior to the damage or destruction, or 

        (b)  Terminate
this Lease, (providing that the Premises is damaged to the extent of 331/3% of the replacement cost. If Landlord does not give Tenant notice in
writing within thirty (30) days from the destruction of the Premises of its election to either rebuild and restore them or to terminate this Lease, Landlord shall be deemed to have elected to rebuild
or restore them, in which event Landlord agrees, at its expense promptly to rebuild or restore the premises to their condition prior to the damage or destruction. Tenant shall be entitled to a
reduction in rent while such repair is being made in the proportion that the area of the Premises rendered untenantable by such damage bears to the total area of the Premises. If it is reasonably
estimated by Landlord that the rebuilding or restoration will exceed 180 days or if Landlord does not complete the rebuilding or restoration within one hundred eighty (180) days following the date of
destruction (such period of time to be extended for delays caused by the fault or neglect of Tenant or because of subsequent acts of God, acts of public agencies, labor disputes, strikes, fires,
freight embargos, rainy or stormy weather, inability to obtain materials, supplies or fuels, acts of contractors or subcontractors, or delay of the contractors or subcontractors due to such causes or
other contingencies beyond the control of Landlord), then Tenant shall have the right to terminate this Lease by giving fifteen (15) days prior written notice to Landlord. Notwithstanding anything
herein to the contrary, Landlord's obligation to rebuild or restore shall be limited to the building and interior improvements constructed by Landlord as they existed as of the commencement date of
the Lease and shall not include restoration of Tenant's trade fixtures, equipment, merchandise, or any improvements, alterations or additions made by Tenant to the Premises, which Tenant shall
forthwith replace or fully repair at Tenant's sole cost and expense provided this Lease is not cancelled according to the provisions above. 

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        Unless
this Lease is terminated pursuant to the foregoing provisions, this Lease shall remain in full force and effect. Tenant hereby expressly waives the provisions of Section 1932,
Subdivision 2, in Section 1933, Subdivision 4 of the California Civil Code. 

        In
the event that the building in which the Premises are situated is damaged or destroyed to the extent of not less than 331/3% of the replacement cost thereof, Landlord
may elect to terminate this Lease, whether the Premises be injured or not. 

22.    EMINENT DOMAIN    If all or any part of the Premises shall be taken by any public or quasi-public authority under the power
of eminent domain or conveyance in lieu thereof, this Lease shall terminate as to any portion of the Premises so taken or conveyed on the date when title vests in the condemnor, and Landlord shall be
entitled to any and all payment, income, rent, award, or any interest therein whatsoever which may be paid or made in connection with such taking or conveyance, and Tenant shall have no claim against
Landlord or otherwise for the value of any unexpired term of this Lease. Notwithstanding the foregoing paragraph, any compensation specifically awarded Tenant for loss of business, Tenant's personal
property, moving cost or loss of goodwill, shall be and remain the property of Tenant. 

        If
any action or proceeding is commenced for such taking of the Premises or any material part thereof, then Landlord shall have the right to terminate this Lease by giving Tenant written
notice thereof within sixty (60) days of the date of receipt of said written advice, or commencement of said action or proceeding, or taking conveyance, which termination shall take place as of the
first to occur of the last day of the calendar month next following the month in which such notice is given or the date on which title to the Premises shall vest in the condemnor. 

        In
the event of such a partial taking or conveyance of the Premises, if the portion of the Premises taken or conveyed is so substantial that the Tenant can no longer reasonably conduct
its business, Tenant shall have the privilege of terminating this Lease within sixty (60) days from the date of such taking or conveyance, upon written notice to Landlord of its intention to do so,
and upon giving of such notice this Lease shall terminate on the last day of the calendar month next following the month in which such notice is given, upon payment by Tenant of the rent from the date
of such taking or conveyance to the date of termination. 

        If
a portion of the Premises be taken by condemnation or conveyance in lieu thereof and neither Landlord nor Tenant shall terminate this Lease as provided herein, this Lease shall
continue in full force and effect as to the part of the Premises not so taken or conveyed, and the rent herein shall be apportioned as of the date of such taking or conveyance so that thereafter the
rent to be paid by Tenant shall be in the ratio that the area of the portion of the Premises not so taken or conveyed bears to the total area of the Premises prior to such taking. 

23.    SALE OR CONVEYANCE BY LANDLORD    In the event of a sale or conveyance of the Premises or any interest therein, by any owner
of the reversion then constituting Landlord, the transferor shall thereby be released as to such interest transferred from any further liability upon any of the terms, covenants or conditions (express
or implied) herein contained in favor of Tenant, and in such event, insofar as such transfer is concerned, Tenant agrees to look solely to the responsibility of the successor in interest of such
transferor in and to the Premises and this Lease. This Lease shall not be affected by any such sale or conveyance, and Tenant agrees to attorn to the successor in interest of such transferor. 

24.    ATTORNMENT TO LENDER OR THIRD PARTY    In the event the interest of Landlord in the land and buildings in which the leased
Premises are located (whether such interest of Landlord is a fee title
interest or a leasehold interest) is encumbered by deed of trust, and such interest is acquired by the lender or any third party through judicial foreclosure or by exercise of a power of sale at
private trustee's foreclosure sale, Tenant hereby agrees to attorn to the purchaser at any such foreclosure sale and to recognize such purchaser as the Landlord under this Lease. In the event the lien
of the deed of 

13

 

trust securing the loan from a Lender to Landlord is prior and paramount to the Lease, this Lease shall nonetheless continue in full force and effect for the remainder of the unexpired term hereof,
at the same rental herein reserved and upon all the other terms, conditions and covenants herein contained. 

25.    HOLDING OVER    Any holding over by Tenant after expiration or other termination of the term of this Lease with the written
consent of Landlord delivered to Tenant shall not constitute a renewal or extension of the Lease or give Tenant any rights in or to the leased Premises except as expressly provided in this Lease. Any
holding over after the expiration or other termination of the term of this Lease, with the consent of Landlord, shall be construed to be a tenancy from month to month, on the same terms and conditions
herein specified insofar as applicable except that the monthly Basic Rent shall be increased to an amount equal to one hundred fifty (150%) percent of the monthly Basic Rent required during the last
month of the Lease term. 

26.    CERTIFICATE OF ESTOPPEL    Tenant shall at any time upon not less than ten (10) days prior written notice from Landlord
execute, acknowledge and deliver to Landlord a statement in writing (i) certifying that this Lease is unmodified and in full force and effect (or, if modified, stating the nature of such
modification and certifying that this Lease, as so modified, is in full force and effect) and the date to which the rent and other charges are paid in advance, if any, and (ii) acknowledging
that there are not, to Tenant's knowledge, any uncured defaults on the part of the Landlord hereunder, or specifying such defaults, if any are claimed. Any such statement may be conclusively relied
upon by any prospective purchaser or encumbrancer of the Premises. Tenant's failure to deliver such statement within such time shall be conclusive upon Tenant that this Lease is in full force and
effect without modification except as may be represented by Landlord; that there are no uncured defaults in Landlord's performance, and that not more than one month's rent has been paid in advance. 

27.    CONSTRUCTION CHANGES    It is understood that the description of the Premises and the location of ductwork, plumbing and
other facilities therein are subject to such minor changes as Landlord or Landlord's architect determines to be desirable in the course of construction of the Premises, and no such changes shall
effect this Lease or entitle Tenant to any reduction of rent hereunder or result in any liability of Landlord to Tenant. Landlord does not guarantee the accuracy of any drawings supplied to Tenant and
verification of the accuracy of such drawings rests with Tenant. 

28.    RIGHT OF LANDLORD TO PERFORM    All terms, covenants and conditions of this Lease to be performed or observed by Tenant shall
be performed or observed by Tenant at Tenant's sole cost and expense and without any reduction of rent. If Tenant shall fail to pay any sum of money, or other rent, required to be paid by it hereunder
and such failure shall continue for five (5) days after written notice by Landlord, or shall fail to perform any other term or covenant hereunder on its part to be performed, and such failure shall
continue for thirty (30) days after written notice thereof by Landlord,
Landlord, without waiving or releasing Tenant from any obligation of Tenant hereunder, may, but shall not be obliged to, make any such payment or perform any such other term or covenant on Tenant's
part to be performed. All sums so paid by Landlord and all necessary costs of such performance by Landlord together with interest thereon at the rate of the prime rate of interest per annum as quoted
by the Bank of America from the date of such payment or performance by Landlord, shall be paid (and Tenant covenants to make such payment) to Landlord within five (5) business days after demand by
Landlord, and Landlord shall have (in addition to any other right or remedy of Landlord) the same rights and remedies in the event of nonpayment by Tenant as in the case of failure by Tenant in the
payment of rent hereunder. 

29.    ATTORNEYS' FEES

        A.    In
the event that either Landlord or Tenant should bring suit for the possession of the Premises, for the recovery of any sum due under this Lease, or because of the
breach of any provision of this Lease, or for any other relief against the other party hereunder, then all costs and expenses, 

14

 

including reasonable attorneys' fees, incurred by the prevailing party therein shall be paid by the other party, which obligation on the part of the other party shall be deemed to have accrued on the
date of the commencement of such action and shall be enforceable whether or not the action is prosecuted to judgment. 

        B.    Should
Landlord be named as a defendant in any suit brought against Tenant in connection with or arising out of Tenant's occupancy hereunder, Tenant shall pay to Landlord
its costs and expenses incurred in such suit, including a reasonable attorney's fee. 

30.    WAIVER    The waiver by either party of the other party's failure to perform or observe any term, covenant or condition
herein contained to be performed or observed by such waiving party shall not be deemed to be a waiver of such term, covenant or condition or of any subsequent failure of the party failing to perform
or observe the same or any other such term, covenant or condition therein contained, and no custom or practice which may develop between the parties hereto during the term hereof shall be deemed a
waiver of, or in any way affect, the right of either party to insist upon performance and observance by the other party in strict accordance with the terms hereof. 

31.    NOTICES    All notices, demands, requests, advices or designations which may be or are required to be given by either party
to the other hereunder shall be in writing. All notices, demands, requests, advices or designations by Landlord to Tenant shall be sufficiently given, made or delivered if personally served on Tenant
by United States certified or registered mail, postage prepaid, or by a reputable same day or overnight courier service, addressed to Tenant at the Premises Attn: President. All notices, demands,
requests, advices or designations by Tenant to Landlord shall be sent by United States certified or registered mail, postage prepaid, addressed to Landlord at its offices at Peery/Arrillaga, 2560
Mission
College Blvd., Suite 101, Santa Clara, CA 95054. Each notice, request, demand, advice or designation referred to in this paragraph shall be deemed received on the date of receipt or refusal to accept
receipt of the mailing thereof in the manner herein provided, as the case may be. Either party shall have the right, upon ten (10) days written notice to the other, to change the address noted herein. 

32.    EXAMINATION OF LEASE    Submission of this instrument for examination or signature by Tenant does not constitute a
reservation of or option for a lease, and this instrument is not effective as a lease or otherwise until its execution and delivery by both Landlord and Tenant. 

33.    DEFAULT BY LANDLORD    Landlord shall not be in default unless Landlord fails to perform obligations required of Landlord
within a reasonable time, but in no event earlier than (30) days after written notice by Tenant to Landlord and to the holder of any first mortgage or deed of trust covering the Premises whose name
and address shall have heretofore been furnished to Tenant in writing, specifying wherein Landlord has failed to perform such obligations; provided, however, that if the nature of Landlord's
obligations is such that more than thirty (30) days are required for performance, then Landlord shall not be in default if Landlord commences performance within such thirty (30) day period and
thereafter diligently prosecutes the same to completion. 

34.    CORPORATE AUTHORITY    If Tenant is a corporation (or a partnership), each individual executing this Lease on behalf of said
corporation (or partnership) represents and warrants that he is duly authorized to execute and deliver this Lease on behalf of said corporation (or partnership) in accordance with the by-laws of said
corporation (or partnership in accordance with the partnership agreement) and that this Lease is binding upon said corporation (or partnership) in accordance with its terms. If Tenant is a
corporation, Tenant shall, within thirty (30) days after execution of this Lease, deliver to Landlord a certified copy of the resolution of the Board of Directors of said corporation
authorizing or ratifying the execution of this Lease. 

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36.    LIMITATION OF LIABILITY    In consideration of the benefits accruing hereunder. Tenant and all successors and assigns
covenant and agree that, in the event of any actual or alleged failure, breach or default hereunder by Landlord: 

        (a)  the
sole and exclusive remedy shall be against Landlord's interest in the Premises leased herein; 

        (b)  no
partner of Landlord shall be sued or named as a party in any suit or action (except as may be necessary to secure jurisdiction of the partnership); 

        (c)  no
service of process shall be made against any partner of Landlord (except as may be necessary to secure jurisdiction of the partnership); 

        (d)  no
partner of Landlord shall be required to answer or otherwise plead to any service of process; 

        (e)  no
judgment will be taken against any partner of Landlord; 

        (f)    any
judgment taken against any partner of Landlord may be vacated and set aside at any time without hearing; 

        (g)  no
writ of execution will ever be levied against the assets of any partner of Landlord; 

        (h)  these
covenants and agreements are enforceable both by Landlord and also by any partner of Landlord. 

        Tenant
agrees that each of the foregoing covenants and agreements shall be applicable to any covenant or agreement either expressly contained in this Lease or imposed by statute or at
common law. 

37.    SIGNS    No sign, placard, picture, advertisement, name or notice shall be inscribed, displayed or printed or affixed on or
to any part of the outside of the Premises or any exterior windows of the Premises without the written consent of Landlord first had and obtained and Landlord shall have the right to remove any such
sign, placard, picture, advertisement, name or notice without notice to and at the expense of Tenant. If Tenant is allowed to print or affix or in any way place a sign in, on, or about the Premises,
upon expiration or other sooner termination of this Lease, Tenant at Tenant's sole cost and expense shall both remove such sign and repair all damage in such a manner as to restore all aspects of the
appearance of the Premises to the condition prior to the placement of said sign. 

        All
approved signs or lettering on outside doors shall be printed, painted, affixed or inscribed at the expense of Tenant by a person approved of by Landlord. 

        Tenant
shall not place anything or allow anything to be placed near the glass of any window, door partition or wall which may appear unsightly from outside the Premises. 

38.    MISCELLANEOUS AND GENERAL PROVISIONS

        A.    Use of Building Name.    Tenant shall not, without the written consent of Landlord, use the name of the building
for any purpose other than as the address of the business conducted by Tenant in the Premises. 

        B.    Choice of Law, Severability.    This Lease shall in all respects be governed by and construed in accordance with
the laws of the State of California. If any provision of this Lease shall be invalid, unenforceable or ineffective for any reason whatsoever, all other provisions hereof shall be and remain in full
force and effect. 

        C.    Definition of Terms.    The term "Premises" includes the space leased hereby and any improvements now or
hereafter installed therein or attached thereto. The term "Landlord" or any pronoun used in place thereof includes the plural as well as the singular and the successors and assigns 

16

 

of Landlord. The term "Tenant" or any pronoun used in place thereof includes the plural as well as the singular and individuals, firms, associations, partnerships and corporations, and their and each
of their respective heirs, executors, administrators, successors and permitted assigns, according to the context hereof, and the provisions of this Lease shall inure to the benefit of and bind such
heirs, executors, administrators, successors, and permitted assigns. 

        The
term "person" includes the plural as well as the singular and individuals, firms, associations, partnerships and corporations. Words used in any gender include other genders. If
there be more than one Tenant the obligations of Tenant hereunder are joint and several. The paragraph headings of this Lease are for convenience of reference only and shall have no effect upon the
construction or interpretation of any provision hereof. 

        D.    Time of Essence.    Time is of the essence of this Lease and of each and all of its provisions. 

        E.    Quitclaim.    At the expiration or earlier termination of this Lease, Tenant shall execute, acknowledge and
deliver to Landlord, within ten (10) days after written demand from Landlord to Tenant, any quitclaim deed or other document required by any reputable title company, licensed to operate in the State
of California, to remove the cloud or encumbrance created by this Lease from the real property of which Tenant's Premises are a part. 

        F.    Incorporation of Prior Agreements: Amendments.    This instrument along with any exhibits and attachment hereto
constitutes the entire agreement between Landlord and Tenant relative to the Premises and this agreement and the exhibits and attachments may be altered, amended or revoked only by an instrument in
writing signed by both Landlord and Tenant. Landlord and Tenant agree
hereby that all prior or contemporaneous oral agreements between and among themselves and their agents or representatives relative to the leasing of the Premises are merged in or revoked by this
agreement. 

        G.    Recording.    Neither Landlord nor Tenant shall record this Lease or a short form memorandum hereof without the
consent of the other. 

        H.    Amendments for Financing.    Tenant further agrees to execute any reasonable amendments required by a lender to
enable Landlord to obtain financing, so long as Tenant's rights hereunder are not substantially affected. 

        I.    Additional Paragraphs.    Paragraphs 39 through 53 are added hereto and are included as a part of this
lease. 

        J.    Clauses, Plats and Riders.    Clauses, plats and riders, if any, signed by Landlord and Tenant and endorsed on
or affixed to this Lease are a part hereof. 

        K.    Diminution of Light, Air or View.    Tenant covenants and agrees that no diminution or shutting off of light,
air or view by any structure which may be hereafter erected (whether or not by Landlord) shall in any way affect his Lease, entitle Tenant to any reduction of rent hereunder or result in any liability
of Landlord to Tenant. 

17

 

        IN
WITNESS WHEREOF, Landlord and Tenant have executed and delivered this Lease as of the day and year last written below. 

	
LANDLORD:	
 	

TENANT:
	

JOHN ARRILLAGA SURVIVOR'S TRUST	
 	

ABGENIX, INC.

a Delaware corporation
	 	 	 	 	 
	

By	

 	
 	

By	

 
	 	
	 	 	

	 	John Arrillaga, Trustee	 	 	 
	 	 	 	 	 
	Date:	 	 	Title	 
	 	
	 	 	

	 	 	 	 	 
	

RICHARD T. PEERY SEPARATE PROPERTY TRUST	
 	

Type or Print
Name                                        
                 
	 	 	 	 	 
	

By	

 	
 	

Date:	

 
	 	
	 	 	

	 	Richard T. Peery, Trustee	 	 	 
	

Date:	

 	
 	

 	

 
	 	
	 	 	 

18

   
Paragraphs 39 through 53 to Lease Agreement Dated January 22, 2002, By and Between the John Arrillaga Survivor's Trust and the Richard T. Peery Separate Property Trust, as Landlord, and
Abgenix, Inc., a Delaware corporation, as Tenant for 50,688± Square Feet of Space Located at 34700 Campus Drive, Fremont, California. 

39.    BASIC RENT:    Subject to Paragraphs 2A, 2B and 48 below, and in accordance with Paragraph 4A herein, the total aggregate sum
of FOURTEEN MILLION FOUR HUNDRED THOUSAND FOUR HUNDRED SIXTY AND 80/100 DOLLARS ($14,400,460.80), shall be payable as follows: 

        Upon
Tenant's execution of this Lease, the sum of EIGHTY-THREE THOUSAND SIX HUNDRED THIRTY-FIVE AND 20/100 DOLLARS ($83,635.20) shall be due, representing the Basic Rent for the period
of May 1, 2002 through May 31, 2002. In the event the Lease does not commence on May 1, 2002, said Basic Rent amount prepaid for the month of May 2002 shall be applied to
the amount due as of the Lease Commencement Date and shall be prorated if the Lease does not commence on the first day of a given month, with any excess payment credited to the following month's Basic
Rent due. 

        On
June 1, 2002, the sum of EIGHTY-THREE THOUSAND SIX HUNDRED THIRTY-FIVE AND 20/100 DOLLARS ($83,635.20) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2002. 

        On
January 1, 2003, the sum of EIGHTY-SIX THOUSAND ONE HUNDRED SIXTY-NINE AND 60/100 DOLLARS ($86,169.60) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2003. 

        On
January 1, 2004, the sum of EIGHTY-EIGHT THOUSAND SEVEN HUNDRED FOUR AND NO/100 DOLLARS ($88,704.00) shall be due, and a like sum due on the first day of each month thereafter,
through and including December 1, 2004. 

        On
January 1, 2005, the sum of NINETY-ONE THOUSAND TWO HUNDRED THIRTY-EIGHT AND 40/100 DOLLARS ($91,238.40) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2005. 

        On
January 1, 2006, the sum of NINETY-THREE THOUSAND SEVEN HUNDRED SEVENTY-TWO AND 80/100 DOLLARS ($93,772.80) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2006. 

        On
January 1, 2007, the sum of NINETY-SIX THOUSAND THREE HUNDRED SEVEN AND 20/100 DOLLARS ($96,307.20) shall be due, and a like sum due on the first day of each month thereafter,
through and including December 2007. 

        On
January 1, 2008, the sum of NINETY-EIGHT THOUSAND EIGHT HUNDRED FORTY-ONE AND 60/100 DOLLARS ($98,841.60) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2008. 

        On
January 1, 2009, the sum of ONE HUNDRED ONE THOUSAND THREE HUNDRED SEVENTY-SIX AND NO/100 DOLLARS ($101,376.00) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2009. 

        On
January 1, 2010, the sum of ONE HUNDRED THREE THOUSAND NINE HUNDRED TEN AND 40/100 DOLLARS ($103,910.40) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2010. 

        On
January 1, 2011, the sum of ONE HUNDRED SIX THOUSAND FOUR HUNDRED FORTY FOUR AND 80/100 DOLLARS ($106,444.80) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2011. 

19

 

        On
January 1, 2012, the sum of ONE HUNDRED EIGHT THOUSAND NINE HUNDRED SEVENTY-NINE AND 20/100 DOLLARS ($108,979.20) shall be due, and a like sum due on the first day of each
month thereafter, through and including December 1, 2012. 

        On
January 1, 2013, the sum of ONE HUNDRED ELEVEN THOUSAND FIVE HUNDRED THIRTEEN AND 60/100 DOLLARS ($111,513.60) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2013. 

        On
January 1, 2014, the sum of ONE HUNDRED FOURTEEN THOUSAND FORTY-EIGHT AND NO/100 DOLLARS ($114,048.00) shall be due, and a like sum due on the first day of each month
thereafter, through and including June 1, 2014; or until the entire aggregate sum of FOURTEEN MILLION FOUR HUNDRED THOUSAND FOUR HUNDRED SIXTY AND 80/100 Dollars ($14,400,460.80) has been paid,
subject to an adjustment as may be required by any provisions providing for abatement of Rent or adjustment of the Term of this Lease. 

40.    CONSENT:    Whenever the consent or approval of one party to the other is required by the terms of this Lease, such consent
or approval shall not be unreasonably withheld. 

41.    ASSESSMENT CREDITS:    The demised property herein may be subject to a special assessment levied by the City of Fremont as
part of an Improvement District. As a part of said special assessment proceedings (if any), additional bonds were or may be sold and assessments were or may be levied to provide for construction
contingencies and reserve funds. Interest shall be earned on such funds created for contingencies and on reserve funds which will be credited for the benefit of said assessment district. To the extent
surpluses are created in said district through unused contingency funds, interest earnings or reserve funds, such surpluses shall be deemed the property of Landlord. Notwithstanding that such
surpluses may be credited on assessments otherwise due against the Leased Premises, Tenant shall pay to Landlord, as additional rent if, and at the time of any such credit of surpluses, an amount
equal to all such surpluses so credited. For example: if (i) the property is subject to an annual assessment of $1,000.00, and (ii) a surplus of $200.00 is credited towards the current
year's assessment which reduces the assessment amount shown on the property tax bill from $1,000.00 to $800.00, Tenant shall, upon receipt of notice from Landlord, pay to Landlord said $200.00 credit
as Additional Rent. 

42.    ASSIGNMENT AND SUBLETTING (CONTINUED):

        A.    In
addition to and notwithstanding anything to the contrary in Paragraph 16 of this Lease, Landlord hereby agrees to consent to Tenant's assigning or subletting
said Lease to: (i) any parent or subsidiary corporation, affiliate, or corporation with which Tenant merges or consolidates, and provided that, with respect to any such assignment, said parent
or subsidiary corporation, affiliate, or said corporation has a net worth equal to or greater than the net worth of Tenant at the time of such assignment, merger, or consolidation; or (ii) any
third party or entity to whom Tenant sells all or substantially all of its assets; provided, that the net worth of the resulting or acquiring corporation has a net worth after the merger,
consolidation or acquisition equal to or greater than the net worth of Tenant at the time of such merger, consolidation or acquisition. No such assignment or subletting will release the Tenant from
its liability and responsibility under this Lease to the extent Tenant continues in existence following such transaction. Notwithstanding the above, Tenant shall be required to (a) give
Landlord written notice prior to such assignment or subletting to any party as described in (i) and (ii) above, and (b) execute Landlord's consent document prepared by Landlord
reflecting the assignment or subletting. 

        B.    Any
and all sublease agreement(s) between Tenant and any and all subtenant(s) (which agreements must be consented to by Landlord, pursuant to the requirements of this
Lease) shall contain the following language: 

        "If
Landlord and Tenant jointly and voluntarily elect, for any reason whatsoever, to terminate the Master Lease prior to the scheduled Master Lease termination date, then this Sublease
(if 

20

 

then still in effect) shall terminate concurrently with the termination of the Master Lease. Subtenant expressly acknowledges and agrees that (1) the voluntary termination of the Master Lease
by Landlord and Tenant and the resulting termination of this Sublease shall not give Subtenant any right or power to make any legal or equitable claim against Landlord, including without limitation
any claim for interference with contract or interference with prospective economic advantage, and (2) Subtenant hereby waives any and all rights it may have under law or at equity against
Landlord to challenge such an early termination of the Sublease, and unconditionally releases and relieves Landlord, and its officers, directors, employees and agents, from any and all claims,
demands, and/or causes of action whatsoever (collectively, "Claims"), whether such matters are known or unknown, latent or apparent, suspected or unsuspected, foreseeable or unforeseeable, which
Subtenant may have arising out of or in connection with any such early termination of this Sublease. Subtenant knowingly and intentionally waives any and all protection which is or may be given by
Section 1542 of the California Civil Code which provides as follows: "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time
of executing the release, which if known by him must have materially affected his settlement with debtor. 

        The
term of this Sublease is therefore subject to early termination. Subtenant's initials here below evidence (a) Subtenant's consideration of and agreement to this early
termination provision, (b) Subtenant's acknowledgment that in determining the net benefits to be derived by Subtenant under the terms of this Sublease, Subtenant has anticipated the potential
for early termination, and (c) Subtenant's agreement to the general waiver and release of Claims above. 

	Initials:	 	    
	 	Initials:	 	    

	 	 	Subtenant	 	 	 	Tenant"

43.    HAZARDOUS MATERIALS:    Landlord and Tenant agree as follows with respect to the existence or use of "Hazardous Materials"
(as defined herein) on, in, under or about the Premises and real property located beneath said Premises (hereinafter collectively referred to as the "Property"): 

As
used herein, the term "Hazardous Materials" shall mean any hazardous or toxic substance, material or waste which is or becomes subject to or regulated by any local governmental authority, the State
of California, or the United States Government. The term "Hazardous Materials" includes, without limitation any material or hazardous substance which is (i) listed under Article 9 or
defined as "hazardous" or "extremely hazardous" pursuant to Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 30, (ii) listed or
defined as a "hazardous waste" pursuant to the Federal Resource Conservation and Recovery Act, Section 42 U.S.C. Section 6901 et. seq., (iii) listed or defined as a "hazardous
substance" pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et. seq, (42 U.S.C. Section 9601), (iv) petroleum or
any derivative of petroleum, or (v) asbestos. 

Tenant
shall have no obligation to "clean up", reimburse, release, indemnify, or defend Landlord with respect to any Hazardous Materials or wastes which Tenant (prior to and during the Term of the
Lease) or other parties on the Property, as described below, (during the Term of this Lease) did not store, dispose, or transport in, use, or cause to be on the Property or which Tenant, its agents,
employees, contractors, vendors, invitees, visitors or its future subtenants and/or assignees (if any) (during the Term of this Lease), did not store, dispose, or transport in, use or cause to be on
the Property in violation of applicable law. 

Tenant
shall be 100 percent liable and responsible for: (i) any and all "investigation and cleanup" of any Hazardous Materials contamination resulting from any Hazardous Materials which Tenant,
its agents, employees, contractors, vendors, invitees visitors or its future subtenants and/or assignees (if any), or other parties on the Property, does store, dispose, or transport in, use or cause
to be on the 

21

 

Property, and (ii) any claims, including third party claims, resulting from such Hazardous Materials contamination. Tenant shall indemnify Landlord and hold Landlord harmless from any
liabilities, demands, costs, expenses and damages, including, without limitation, attorney fees incurred as a result of any claims resulting from any such Hazardous Materials contamination. 

Tenant
also agrees not to use or dispose of any Hazardous Materials on the Property without first obtaining Landlord's written consent; provided, however, that Landlord's consent shall not be required
for normal use of customary household and office supplies, such as cleaners, lubricants, solvents, copier toner, etc. Tenant agrees to complete compliance with governmental regulations regarding the
use or removal or remediation of all Hazardous Materials used, stored, disposed of, transported or caused to be on the Property as stated above, and prior to the termination of said Lease Tenant
agrees to follow the proper closure procedures and will obtain a clearance from the local fire department and/or the appropriate governing agency. If Tenant uses any Hazardous Materials, Tenant also
agrees to install, at Tenant's expense, such Hazardous Materials monitoring devices as Landlord deems reasonably necessary. It is agreed that the Tenant's responsibilities related to Hazardous
Materials will survive the termination date of the Lease and that Landlord may obtain specific performance of Tenant's responsibilities under this Paragraph 43. 

Subject
to the terms and conditions of this Lease, Landlord hereby acknowledges its consent to Tenant's storage and use on the Property of those Hazardous Materials listed on  Exhibit C attached
hereto. At Tenant's sole cost and expense, each year upon the anniversary of the Commencement Date of the Lease Term ("Anniversary Date"), Tenant shall hire a qualified environmental consultant,
acceptable to Landlord, to evaluate whether Tenant is in compliance with all applicable Governmental Regulations pertaining to Hazardous Materials. Tenant shall submit to Landlord a report from such
environmental consultant which discusses the environmental consultant's findings within two (2) months of each Anniversary Date. Tenant shall promptly take all steps necessary to correct any and all
problems identified by the environmental consultant and provide Landlord with documentation of all such corrections. 

As
evidenced by their initials set forth immediately below, Tenant acknowledges that Landlord has provided Tenant with copies of the environmental reports listed on  Exhibit D ("Reports"), and Tenant
acknowledges that Tenant and Tenant's experts (if any) have had ample opportunity to review such reports and
that Tenant has satisfied itself as to the environmental conditions of the Property and the suitability of such conditions for Tenant's intended use of the Property. To the best of Landlord's
knowledge as of the date of this Lease, except as noted in said Reports, no additional on site Hazardous Materials contamination exist on the Property; however, Landlord shall have no obligation to
further investigate. 

	Initial:	 	    
	 	Initial:	 	    

	 	 	Tenant	 	 	 	Landlord

It
is agreed that the Tenant's responsibilities related to Hazardous Materials will survive the expiration or termination of this Lease and that Landlord may obtain specific performance of Tenant's
responsibilities under this Paragraph 43. 

44.    ASSOCIATION DUES:    The Premises leased hereunder is part of the Ardenwood Property Owner's Association (the "Association"),
and is subject to Association Dues to fund the cost of the Association's obligations and expenses as authorized under said Agreement. As of the date of this Lease, Tenant's current prorata share of
the Association Dues is currently estimated at $44.52 per month and is subject to adjustment as provided for by said Association. Said Association Dues are payable to Tenant to Landlord as Additional
Rent on a monthly basis throughout the Term of this Lease. Tenant understands that it will not be a direct member of the Association. 

45.    AUTHORITY TO EXECUTE:    The parties executing this Agreement hereby warrant and represent that they are properly authorized
to execute this Agreement and bind the parties on behalf of whom they execute this agreement and to all of the terms, covenants and conditions of this Agreement as they relate to the respective
parties hereto. 

22

  

46.    TAXES CONTINUED:    Notwithstanding anything within Paragraph 9, it is agreed that if any special assessments for
capital improvements are assessed, and if Landlord has the option to either pay the entire assessment in cash or go to bond, and if Landlord elects to pay the entire assessment in cash in lieu of
going to bond, the entire portion of the assessment assigned to Tenant's Leased Premises will be prorated over the same period that the assessment would have been prorated had the assessment gone to
bond. 

47.    SUBORDINATION AND MORTGAGES CONTINUED:    Landlord represents to Tenant that the Premises are not presently encumbered by a
deed of trust or other security device in favor of any Lender. 

48.    LEASE CONTINGENT UPON LANDLORD OBTAINING TERMINATION AGREEMENT WITH CURRENT TENANT:    This Lease is subject to and
conditional upon Landlord obtaining from Matrix Pharmaceutical, Inc. ("Matrix"), the current tenant occupying the Premises leased hereunder, a Termination Agreement related to the Premises
satisfactory to Landlord on or before April 30, 2002. In the event Matrix does not fully vacate and surrender the Premises to Landlord on or before April 30, 2002, the scheduled
Commencement Date herein shall automatically be amended to June 1, 2002. In the event Landlord is unable to obtain said satisfactory Termination Agreement on or before May 31, 2002, this
Lease shall be automatically rescinded. 

49.    BROKERS.    Landlord and Tenant each represent and warrant that they have not dealt with any real estate brokers, agents, or
finders in connection with the original Term of this Lease, and know of no real estate broker, agent or finder who is entitled to a commission in connection with this Lease ("Lease Commission"),
except Mark Pearson of Cresa Partners, which Lease Commission shall be paid one hundred percent (100%) by Matrix Pharmaceutical, Inc. The parties hereto acknowledge that Landlord will not pay a Lease
Commission to Mark Pearson, Cresa Partners or any other broker related to the original Term of this Lease, or in the event this Lease is extended or the square footage leased hereunder is increased
for any reason whatsoever. Landlord and Tenant each agrees to defend, protect, indemnify and hold the other party harmless from and against all claims for brokerage commissions, finder's fees, and
other compensation made by any other broker, agent, or finder as consequence of Landlord's or Tenant's actions or dealings with such other broker, agent or finder. 

50.    CROSS DEFAULT.    It is understood that Landlord and Tenant have previously entered into another lease dated July 31,
1996 for premises located at 7601 Dumbarton Circle, Fremont, California (the "Existing Lease"). As a material part of the consideration for the execution of this Lease by Landlord, it is agreed
between Landlord and Tenant that a default under this Lease, or a default under said
Existing Lease may, at the option of Landlord, be considered a default under both leases, in which event Landlord shall be entitled (but in no event required) to apply all rights and remedies of
Landlord under the terms of one lease to both leases including, but not limited to, the right to terminate one or both of said leases by reason of a default under said Existing Lease or hereunder. 

51.    OPTION TO EXTEND LEASE FOR ONE (1) YEAR SEVEN (7) MONTHS:    Landlord hereby grants to Tenant an Option to Extend this Lease
Agreement for an additional one (1) year seven (7) month period upon the following terms and conditions; 

        A.    Tenant
shall give Landlord written notice of Tenant's exercise of this Option to Extend not later than twelve (12) months prior to the scheduled Lease Termination Date,
which Termination Date is currently projected to be June 30, 2014, in which event the Lease shall be considered extended for an additional one (1) year and seven (7) months, subject to the
Basic Rental set forth below and with: (i) the Rent to be determined pursuant to Paragraph B below; (ii) the terms and conditions subject to amendment by Landlord (Landlord, in
its sole and absolute discretion, may, but is not required to, incorporate its current Lease provisions that are standard in Landlord's leases as of the date of Tenant's exercise of its Option to
Extend); and (iii) this Paragraph 51 deleted. In the event that Tenant fails to timely exercise Tenant's Option to Extend as set forth herein in writing, Tenant shall have no 

23

 

further Option to Extend this Lease, and this Lease shall continue in full force and effect for the full remaining term hereof, absent this Paragraph 51. 

        B.    In
the event Tenant timely exercises Tenant's Option to Extend as set forth herein, Landlord shall, within fifteen (15) days after receipt of Tenant's exercise of option,
advise Tenant of the terms and conditions and Rent required for the Extended Term of the Lease. Tenant shall have five (5) days after receipt from the Landlord of said new terms and conditions and
Rent in which to accept said new Basic Rental, terms and conditions and enter into written documentation confirming same. In the event Tenant fails to execute said written documentation confirming
said new terms and conditions and Rent for the Extended Term of Lease within said five (5) day period, Tenant shall have no further Option to Extend this Lease, and this Lease shall continue in full
force and effect for the full remaining term hereof absent of this Paragraph 51, with Landlord having no further responsibility or obligation to Tenant with respect to Tenant's Option to
Extend. 

        C.    The
option rights of Tenant under this Paragraph 51, and the Extended Term hereunder, are granted for Tenant's personal benefit and may not be assigned or transferred by
Tenant, either voluntarily or by operation of law, in any manner whatsoever (except to a parent or subsidiary corporation or successor by merger as provided for in Paragraph 42A). In the event that
Landlord consents to a sublease or assignment under Paragraph 51, the option granted herein and any Extended Term hereunder shall be void and of no force and effect, whether or not Tenant shall
have purported to exercise such option prior to such assignment or sublease. 

        D.    It
is agreed that if Tenant is at any time prior to exercising its Option to Extend in default of this Lease and has failed to cure the default in the time period
allowed, this Paragraph 51 will be null and void and Tenant will have no further rights under this Paragraph 51. It is further agreed that if Tenant has exercised its Option to Extend
and is subsequently in default and fails to cure said default in the time period allowed prior to, or at any time the lease commences on the Extended Term, Landlord may at its sole and absolute
discretion, cancel Tenant's Option to Extend, and this Lease will continue in full force and effect for the full remaining term hereof, absent of this Paragraph 51. 

52.    EXISTING TENANT IMPROVEMENTS:    It is agreed between the parties hereto that the existing tenant improvements ("Existing
Tenant Improvements") as detailed on Exhibit B-1 attached hereto shall not be removed from the Premises by Landlord prior to the Lease Commencement Date or thereafter during the Lease Term and
that said Existing Tenant Improvements will be available for Tenant's use during the Lease Term. Notwithstanding the above, Tenant shall be one hundred percent (100%) responsible for the maintenance,
repair and replacement (if necessary) of said Existing Tenant Improvements. 

53.    TRADE FIXTURES:    Notwithstanding anything to the contrary in Lease Paragraphs 5 ("Acceptance and Surrender of
Premises") and 6 ("Alterations and Additions"), Tenant shall be entitled to remove any trade fixtures that are not attached to the Premises. Any trade fixtures that are attached to the Premises shall
become the property of Landlord at the expiration of the Lease, and may not be removed by Tenant without the prior written consent of Landlord. Tenant shall be one hundred percent (100%) responsible
for the maintenance, repair and replacement (if necessary) of all trade fixtures installed in the Premises. 

24

 
[Floor Plan 1]  

EXHIBIT A TO LEASE AGREEMENT DATED JANUARY 22, 2002 BY AND BETWEEN THE JOHN ARRILLAGA SURVIVOR'S TRUST AND THE
RICHARD T. PEERY SEPARATE PROPERTY TRUST, AS LANDLORD, AND ABGENIX, INC., AS TENANT.  

25

 
 [Floor Plan 2]  

EXHIBIT B TO LEASE AGREEMENT DATED JANUARY 22, 2002 BY AND BETWEEN THE JOHN ARRILLAGA SURVIVOR'S TRUST AND THE
RICHARD T. PEERY SEPARATE PROPERTY TRUST, AS LANDLORD, AND ABGENIX, INC., AS TENANT.  

26

 
  
 

    EXHIBIT B-1
  
    Existing Tenant Improvements Not to Be Removed By Landlord
  Prior to Lease Commencement Date or During the Lease Term    
  

	1.
	All
HVAC, plumbing, electrical, and security systems currently installed (as of the Lease Commencement Date) within the Premises.

	2.
	Emergency
 Generator.

	3.
	All
walls, doors and built-in cabinetry.

	4.
	All
laboratory case work and fume hoods.

	5.
	One
cold room.

	6.
	All
installed glass wash and autoclave equipment/facilities.

	7.
	All
installed equipment/facilities servicing the vivarium (Bally Boiler and Gage Wash equipment).

	8.
	All
other installed utility systems and related infrastructure shall remain in place.

	9.
	All
installed data/telephone cabling.

	10.
	All
installed document storage vaults 

Notwithstanding
anything to the contrary in said Lease, Tenant shall be one hundred percent (100%) responsible for the maintenance, repair and replacement (if necessary) of said items noted above. 

27

  

 
 

Exhibit C to Lease Agreement dated January 22, 2002    
  

Abgenix                  Estimated Chemical Inventory for B-6  

	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	Units

(lbs,

gal,

cu

ft)
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 

	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	NFPA

	Hazard Class
	 	Common

Name
	 	 
	 	 
	 	Extremely

Hazardous?
	 	Pure or

Mixture
	 	Solid,

Gas or

Liquid
	 	Fed

Haz

Cat
	 	Days

on

Site
	 	Largest

Container
	 	Max.

Amount
	 	Avg

Amount
	 	 
	 	 
	 	 

	 	Chemical Name
	 	CAS #
	 	Container
	 	Pressure
	 	Temp
	 	Health
	 	Fire
	 	Reactivity

	TOX	 	 	 	10% Azide	 	26628-22-8	 	N	 	P	 	L	 	ACR	 	365	 	0.1	 	0.2	 	0.1	 	G	 	PB	 	A	 	A	 	3	 	1	 	3
	FL	 	 	 	1-Propanol	 	71-23-B	 	N	 	P	 	L	 	CAF	 	365	 	1	 	1	 	1	 	G	 	GB	 	A	 	A	 	1	 	3	 	0
	FL	 	 	 	2 Propanol	 	67-63-0	 	N	 	P	 	L	 	ACF	 	365	 	1	 	4	 	2	 	G	 	PB	 	A	 	A	 	2	 	3	 	0
	IRR	 	Bleach	 	5% Sodium Hydrochlorite	 	7681-52-9	 	N	 	P	 	L	 	C	 	365	 	1	 	2	 	1	 	G	 	PB	 	A	 	A	 	2	 	0	 	1
	COR	 	 	 	5% Sodium Hydroxide	 	1310-73-2	 	N	 	P	 	L	 	A	 	365	 	0.2	 	0.2	 	0.2	 	G	 	PB	 	A	 	A	 	3	 	0	 	1
	COR	 	LancerAid	 	Acetic Acid	 	631-61-8	 	N	 	M	 	L	 	C	 	365	 	25	 	50	 	40	 	G	 	CB	 	A	 	A	 	t	 	1	 	0
	COR	 	 	 	Acetic Acid	 	64-19-7	 	N	 	P	 	L	 	AR	 	365	 	0.2	 	1	 	0.5	 	G	 	GB	 	A	 	A	 	3	 	2	 	0
	IRR	 	 	 	Acetic Acid Glacial	 	64-19-7	 	N	 	P	 	L	 	CA	 	365	 	0.2	 	0.2	 	0.2	 	G	 	GB	 	A	 	A	 	2	 	2	 	1
	IRR	 	 	 	Acetic Acid Glacial	 	64-19-7	 	N	 	P	 	L	 	ACFR	 	365	 	0.3	 	0.3	 	0.3	 	G	 	GB	 	A	 	A	 	2	 	2	 	1
	FL	 	 	 	Acetone	 	67-64-1	 	N	 	P	 	L	 	A/F	 	365	 	1	 	3	 	2	 	G	 	GB	 	A	 	A	 	2	 	3	 	0
	FL	 	 	 	Acetone?	 	75-05-8	 	N	 	P	 	L	 	ACF	 	365	 	1	 	5	 	2.5	 	G	 	GB	 	A	 	A	 	3	 	3	 	0
	NFG	 	 	 	Air Compressed	 	25635-88-5	 	N	 	P	 	G	 	P	 	365	 	250	 	5000	 	5000	 	CF	 	CY	 	G	 	A	 	0	 	0	 	0
	NFG	 	Air	 	Air, Compressed	 	25635-88-5	 	N	 	P	 	G	 	P	 	365	 	233	 	466	 	466	 	cu ft	 	CYL	 	G	 	A	 	0	 	0	 	0
	OHH	 	 	 	Aluminum Potassium Sulfate	 	7784-24-9	 	N	 	P	 	S	 	C	 	365	 	0.25	 	0.5	 	0.25	 	P	 	PB	 	A	 	A	 	1	 	0	 	0
	OHH	 	 	 	Ammonium Bicarbonate	 	1066-33-7	 	N	 	P	 	S	 	C	 	365	 	0.5	 	1.00	 	0.50	 	P	 	PB	 	A	 	A	 	1	 	0	 	0
	IRR	 	 	 	Ammonium Chloride	 	12125-02-9	 	N	 	P	 	S	 	A	 	365	 	0.1	 	0.1	 	0.1	 	P	 	PB	 	A	 	A	 	2	 	0	 	0
	COR	 	 	 	Ammonium Hydroxide	 	1336-21-6	 	N	 	P	 	L	 	CIA	 	365	 	0.25	 	1	 	0.5	 	G	 	GB	 	A	 	A	 	3	 	1	 	0
	OX	 	 	 	Ammonium Persulfate	 	7727-54-9	 	N	 	P	 	S	 	AR	 	365	 	0.1	 	0.25	 	0.1	 	P	 	GB	 	A	 	A	 	2	 	0	 	1
	IRR	 	 	 	Ammonium Sulfate	 	7783-20-2	 	N	 	P	 	S	 	C	 	365	 	0.25	 	1	 	1	 	G	 	PB	 	A	 	A	 	2	 	0	 	0
	IRR	 	 	 	Ammonium Chloride	 	12125-02-9	 	N	 	P	 	S	 	C	 	365	 	0.1	 	0.2	 	0.1	 	P	 	PB	 	A	 	A	 	2	 	0	 	0
	MFG	 	 	 	Argon	 	7440-37-1	 	N	 	P	 	G	 	P	 	365	 	100	 	100	 	100	 	CF	 	CY	 	G	 	A	 	0	 	0	 	0
	DHH	 	 	 	Aspartic Acid	 	617-45-8	 	N	 	P	 	S	 	C	 	365	 	0.2	 	0.4	 	0.2	 	P	 	PB	 	A	 	A	 	1	 	0	 	0
	IRR	 	 	 	Butyric Acid	 	107-92-6	 	N	 	P	 	L	 	AF	 	365	 	0.1	 	0.1	 	0.1	 	G	 	PB	 	A	 	A	 	2	 	2	 	0
	FS	 	 	 	Carbon Decolorizing	 	7440-44-0	 	N	 	P	 	S	 	CF	 	365	 	0.2	 	0.5	 	0.2	 	P	 	GB	 	A	 	A	 	3	 	3	 	0
	CRY	 	 	 	Carbon dioxide, liquified	 	124-38-9	 	N	 	P	 	L	 	PA	 	365	 	40	 	120	 	120	 	GAL	 	DEW	 	G	 	L	 	3	 	0	 	0
	TOX	 	 	 	Chloroform	 	67-66-3	 	N	 	P	 	L	 	A/C	 	365	 	0.2	 	0.20	 	0.20	 	G	 	GB	 	A	 	A	 	3	 	0	 	0
	COR	 	Chronenge	 	Chromium Trioxide	 	1333-82-0	 	N	 	P	 	L	 	ACR	 	365	 	0.1	 	0.2	 	0.1	 	G	 	GB	 	A	 	A	 	3	 	0	 	2
	IRR	 	 	 	Citric Acid	 	5949-29-1	 	N	 	P	 	S	 	C	 	365	 	0.25	 	1	 	1	 	P	 	GB	 	A	 	A	 	2	 	1	 	0

28

 
Exhibit C to Lease Agreement dated January 22, 2002  

Abgenix                  Estimated Chemical Inventory for B-6  

	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	Units

(lbs,

gal,

cu ft)
	 	 
	 	 
	 	 
	 	NFPA

	Hazard

Class
	 	Common

Name
	 	 
	 	 
	 	Extremely

Hazardous?
	 	Pure or

Mixture
	 	Solid,

Gas or

Liquid
	 	Fed

Haz

Cat
	 	Days

on

Site
	 	Largest

Container
	 	Max.

Amount
	 	Avg

Amount
	 	 
	 	 
	 	 

	 	Chemical Name
	 	CAS #
	 	Container
	 	Pressure
	 	Temp
	 	Health
	 	Fire
	 	Reactivity

	OHH	 	 	 	D(+)- Glucose	 	50-99-7	 	N	 	P	 	S	 	C	 	365	 	500	 	500	 	300	 	P	 	FB	 	A	 	A	 	0	 	0	 	0
	CL	 	Diesel	 	Diesel #2	 	68476-34-6	 	N	 	M	 	L	 	FAC	 	365	 	400	 	400	 	400	 	G	 	AT	 	A	 	A	 	0	 	2	 	0
	FL	 	Starting Fluid	 	Diethyl ether	 	60-29-7	 	N	 	M	 	L	 	ACF	 	365	 	0.5	 	0.5	 	0.5	 	CUFT	 	CN	 	G	 	A	 	2	 	4	 	1
	OHH	 	 	 	Diethylenetrismin-pentacetic acid	 	67-43-6	 	N	 	M	 	S	 	C	 	365	 	0.1	 	0.1	 	0.1	 	P	 	GB	 	A	 	A	 	1	 	0	 	0
	FL	 	Acetone	 	Dimethyl Ketone	 	67-64-1	 	N	 	P	 	L	 	FA	 	365	 	1	 	2	 	2	 	G	 	PB	 	A	 	A	 	1	 	3	 	0
	OHH	 	 	 	Dimethyl Polysifoxane	 	9016-00-6	 	N	 	P	 	L	 	C	 	365	 	0.5	 	0.5	 	0.5	 	G	 	GB	 	A	 	A	 	1	 	1	 	0
	OHH	 	 	 	Dimethyl Sulfox	 	67-68-5	 	N	 	P	 	L	 	CA	 	365	 	0.1	 	0.20	 	0.1	 	L	 	GB	 	A	 	A	 	1	 	1	 	0
	OHH	 	 	 	Dimethyl Sulphoxide	 	67-68-5	 	N	 	P	 	L	 	C	 	365	 	0.1	 	0.1	 	0.1	 	G	 	GB	 	A	 	A	 	1	 	1	 	0
	OHH	 	 	 	Disodium Pyrophosphate	 	7722-88-5	 	N	 	P	 	S	 	C	 	365	 	0.25	 	0.5	 	0.25	 	P	 	PB	 	A	 	A	 	1	 	0	 	0
	OHH	 	 	 	DMSO	 	67-68-5	 	N	 	P	 	L	 	C	 	365	 	0.1	 	0.1	 	0.1	 	G	 	GB	 	A	 	A	 	1	 	1	 	0
	FL	 	Alcohol	 	Ethanol	 	64-17-5	 	N	 	P	 	L	 	FAC	 	365	 	1	 	2	 	1	 	G	 	PB	 	A	 	A	 	0	 	3	 	0
	FL	 	 	 	Ethanol 70%	 	64-17-5	 	N	 	P	 	L	 	ACF	 	365	 	1	 	6	 	6	 	G	 	PB	 	A	 	A	 	0	 	3	 	0
	FL	 	Gills III	 	Ethanol, Aluminus Sulfate	 	64-17-5	 	N	 	M	 	L	 	FC	 	365	 	0.25	 	0.25	 	0.25	 	G	 	PB	 	A	 	A	 	1	 	3	 	0
	FL	 	Eosiny Stain	 	Ethanol, Aluminus Sulfate	 	64-17-5

631-61-8	 	N	 	M	 	L	 	FC	 	365	 	0.25	 	0.25	 	0.25	 	G	 	PB	 	A	 	A	 	0	 	3	 	0
	FL	 	Reagent Alcohol	 	Ethanol, Methanol	 	64-17-5

57-56-1	 	N	 	M	 	L	 	CAF	 	365	 	0.25	 	4	 	4	 	G	 	GB	 	A	 	A	 	0	 	3	 	0
	FL	 	Reagent Alcohol	 	Ethanol, methanol, isopropanol	 	64-17-5	 	N	 	M	 	L	 	F	 	365	 	1	 	10	 	6	 	G	 	PB	 	A	 	A	 	0	 	3	 	0
	FL	 	REAGENT ALOCHOL	 	ETHANOL/METHONAL	 	64-17-5	 	N	 	P	 	L	 	CAF	 	365	 	1	 	3	 	2	 	G	 	PB	 	A	 	A	 	0	 	3	 	0
	OHH	 	 	 	Ethanolamine	 	2002-24-6	 	N	 	P	 	S	 	AR	 	365	 	0.25	 	0.25	 	0.25	 	P	 	PB	 	A	 	A	 	1	 	0	 	1
	COR/FLAM	 	Ethanolamine	 	141-43-5	 	N	 	P	 	L	 	CFA	 	365	 	0.26	 	1	 	0.5	 	G	 	GB	 	A	 	A	 	3	 	2	 	0
	OHH	 	 	 	Ethylene Bromine	 	1239-49-8	 	N	 	P	 	L	 	C	 	365	 	10	 	0.10	 	10	 	G	 	GB	 	A	 	A	 	1	 	1	 	0
	FL	 	 	 	Ethyl Alcohol	 	64-17-5	 	N	 	P	 	L	 	ACF	 	365	 	0.25	 	5	 	2.5	 	G	 	GB	 	A	 	A	 	2	 	3	 	0
	OHH	 	 	 	Ethylenediamineletracelic Acid	 	60-00-4	 	N	 	P	 	S	 	C	 	365	 	0.1	 	0.25	 	0.1	 	P	 	PB	 	A	 	A	 	1	 	0	 	0
	OHH	 	 	 	Ferrous Sulfate	 	7720-78-7	 	N	 	P	 	S	 	C	 	365	 	0.1	 	0.25	 	0.1	 	P	 	PB	 	A	 	A	 	1	 	1	 	0
	IOX	 	 	 	Formaldehyde	 	50-08-0	 	Y	 	P	 	L	 	ACF	 	365	 	0.25	 	0.5	 	0.25	 	G	 	GB	 	A	 	A	 	3	 	2	 	0
	CL	 	 	 	Formatin 4%	 	50-00-01	 	N	 	P	 	L	 	ACF	 	365	 	0.1	 	0.1	 	0.1	 	G	 	PB	 	A	 	A	 	3	 	2	 	0
	COR	 	 	 	Formic Acid	 	64-18-6	 	N	 	P	 	L	 	AF	 	365	 	0.2	 	1	 	0.5	 	G	 	PB	 	A	 	A	 	3	 	2	 	0
	COR	 	 	 	Formic Acid 1% IPR	 	64-18-6	 	N	 	M	 	L	 	ACF	 	365	 	0.1	 	0.5	 	0.25	 	G	 	GB	 	A	 	A	 	3	 	2	 	0

29

   Exhibit C to Lease Agreement dated January 22, 2002  

Abgenix                  Estimated Chemical Inventory for B-6  

	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	NFPA

	Hazard Class
	 	Common Name
	 	Chemical Name
	 	 
	 	Extremely Hazardous?
	 	Pure or Mixture
	 	Solid, Gas or Liquid
	 	Fed Haz Cat
	 	Days on Site
	 	Largest Container
	 	Max. Amount
	 	Avg Amount
	 	Units (lbs, gal, cu ft)
	 	 
	 	 
	 	 

	 	CAS #
	 	Container
	 	Pressure
	 	Temp
	 	Health
	 	Fire
	 	Reactivity

	OHH	 	 	 	Glutamic Acid	 	56-85-0	 	N	 	P	 	S	 	C	 	365	 	0.5	 	0.1	 	0.1	 	P	 	PB	 	A	 	A	 	0	 	0	 	0
	OHH	 	Glycerol	 	Glycerin	 	56-81-5	 	N	 	P	 	L	 	C	 	365	 	0.2	 	0.25	 	0.2	 	G	 	PB	 	A	 	A	 	1	 	1	 	0
	OHH	 	 	 	Glycerin	 	56-81-5	 	N	 	P	 	L	 	C	 	365	 	0.1	 	0.20	 	0.1	 	G	 	GB	 	A	 	A	 	1	 	1	 	0
	OHH	 	 	 	Glycerol	 	56-81-5	 	N	 	P	 	L	 	C	 	365	 	1	 	3	 	1.5	 	G	 	GB	 	A	 	A	 	1	 	1	 	0
	OHH	 	 	 	Glycine	 	58-40-6	 	N	 	P	 	S	 	C	 	365	 	0.1	 	0.25	 	0.25	 	P	 	PB	 	A	 	A	 	0	 	1	 	0
	RAD	 	Tritium	 	H-3	 	 	 	N	 	P	 	S/L	 	C	 	365	 	1	 	10	 	2	 	mCi	 	GB	 	A	 	A	 	 	 	 	 	 
	NFG	 	 	 	Helium Compressed	 	7440-59-7	 	N	 	P	 	G	 	P	 	365	 	304	 	1250	 	1250	 	CF	 	CY	 	G	 	A	 	0	 	0	 	0
	NFG	 	 	 	Helium Compressed	 	7440-59-7	 	N	 	P	 	G	 	C,P	 	365	 	291	 	291	 	291	 	CF	 	CYL	 	G	 	A	 	0	 	0	 	0
	NFG	 	 	 	Helium, Compressed	 	7440-59-7	 	N	 	P	 	G	 	P	 	365	 	223	 	223	 	223	 	cuft	 	CY	 	G	 	A	 	0	 	0	 	0
	COR	 	 	 	Hydrochloric Acid	 	7647-01-0	 	N	 	P	 	L	 	A	 	365	 	0.25	 	3	 	1.5	 	G	 	PB	 	A	 	A	 	3	 	0	 	0
	OX	 	 	 	Hydrogen Peroxide	 	7722841	 	N	 	P	 	L	 	ACR	 	365	 	0.1	 	0.2	 	0.1	 	G	 	PB	 	A	 	A	 	3	 	0	 	1
	OX	 	 	 	Hydrogen Peroxide 30%	 	7722-B4-1	 	N	 	P	 	L	 	AC	 	365	 	0.1	 	0.2	 	0.1	 	G	 	PB	 	A	 	A	 	3	 	0	 	1
	OX	 	 	 	Hydrogen Peroxide 30%	 	7722-B4-1	 	N	 	P	 	L	 	A	 	365	 	0.1	 	0.1	 	0.1	 	G	 	PB	 	A	 	A	 	3	 	0	 	1
	COR	 	 	 	Hydroxamine Hydrochloride	 	5470-11-1	 	N	 	P	 	L	 	ACR	 	365	 	0.1	 	0.2	 	0.1	 	P	 	GB	 	A	 	A	 	3	 	1	 	1
	RAD	 	 	 	I-125	 	 	 	N	 	P	 	S/L	 	C	 	365	 	1	 	10	 	2	 	mCi	 	GB	 	A	 	A	 	 	 	 	 	 
	FL	 	2-Propanol	 	Isopropanol	 	E7-63-0	 	N	 	P	 	L	 	CAF	 	365	 	1	 	15	 	5	 	G	 	GB	 	A	 	A	 	2	 	3	 	0
	IRR	 	 	 	Karamycin	 	25369-94-0	 	N	 	P	 	S	 	C	 	365	 	0.1	 	0.1	 	0.1	 	P	 	PB	 	A	 	A	 	2	 	0	 	0
	CL	 	Charcoal Starter	 	Kerosene	 	8008-20-6	 	N	 	M	 	L	 	F	 	365	 	0.1	 	0.2	 	0.1	 	G	 	PB	 	A	 	A	 	1	 	2	 	0
	OHH	 	 	 	Lauryl Sulfate	 	151-21-3	 	N	 	P	 	S	 	C	 	365	 	0.25	 	0.5	 	0.25	 	P	 	PB	 	A	 	A	 	1	 	0	 	0
	CRY	 	 	 	Liquid Nitrogen	 	7727-37-9	 	N	 	P	 	L	 	PA	 	365	 	40	 	160	 	120	 	GAL	 	DEW	 	G	 	L	 	3	 	0	 	0
	CRY	 	 	 	Liquid Nitrogen	 	7727-37-9	 	N	 	P	 	L	 	PA	 	365	 	40	 	300	 	240	 	G	 	DEW	 	G	 	L	 	3	 	0	 	0
	OHH	 	 	 	L-Protine	 	147-85-3	 	N	 	P	 	S	 	C	 	365	 	0.1	 	0.1	 	0.1	 	P	 	PB	 	A	 	A	 	1	 	0	 	0
	FL	 	Reagent grade alcohol	 	Methanol	 	64-17-5	 	N	 	P	 	L	 	F	 	365	 	1	 	6	 	4	 	G	 	PB	 	A	 	A	 	0	 	3	 	0
	FL	 	 	 	Methanol	 	67-58-1	 	N	 	P	 	L	 	A/C	 	365	 	1	 	8	 	1	 	G	 	GB	 	A	 	A	 	1	 	3	 	0
	CL	 	10% buffered	 	methanol, formaldehyde	 	50-00-0	 	N	 	M	 	L	 	FAC	 	365	 	1	 	1	 	2	 	G	 	PB	 	A	 	A	 	2	 	2	 	0
	FL	 	Methanol	 	Methyl Alcohol	 	67-56-1	 	N	 	P	 	L	 	FA	 	365	 	1	 	2	 	1	 	G	 	GB	 	A	 	A	 	1	 	3	 	0
	FL	 	Paint	 	Methyl ethyl ketone	 	78-86-4	 	N	 	M	 	L	 	F	 	365	 	0.1	 	0.1	 	0.1	 	G	 	CN	 	G	 	A	 	1	 	3	 	0
	TOX	 	 	 	Methylene Chloride	 	75-09-2	 	N	 	P	 	L	 	A/C	 	365	 	0.25	 	0.5	 	0.25	 	G	 	GB	 	A	 	A	 	3	 	1	 	0
	OHH	 	 	 	Mineral Oil	 	8012-95-1	 	N	 	P	 	L	 	C	 	365	 	0.25	 	0.20	 	0.25	 	G	 	PB	 	A	 	A	 	0	 	1	 	0

30

 
Exhibit C to Lease Agreement dated January 22, 2002  

Abgenix                  Estimated Chemical Inventory for B-6  

	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	NFPA

	Hazard Class
	 	Common Name
	 	 
	 	 
	 	Extremely Hazardous?
	 	Pure or Mixture
	 	Solid, Gas or Liquid
	 	Fed Haz Cat
	 	Days on Site
	 	Largest Container
	 	Max. Amount
	 	Avg Amount
	 	Units (lbs, gal, cu ft)
	 	 
	 	 
	 	 

	 	Chemical Name
	 	CAS #
	 	Container
	 	Pressure
	 	Temp
	 	Health
	 	Fire
	 	Reactivity

	IRR	 	 	 	N,N- Dimethyl Formamide	 	6B-12-2	 	N	 	P	 	S	 	AF	 	365	 	1	 	1	 	1	 	P	 	PB	 	A	 	A	 	2	 	2	 	0
	CL	 	 	 	N,N-Dimethyl Formamide	 	6B-12-2	 	N	 	P	 	L	 	CAF	 	365	 	0.2	 	0.25	 	0.2	 	G	 	GB	 	A	 	A	 	1	 	2	 	0
	OX	 	 	 	Nitric Acid	 	7697-37-2	 	N	 	P	 	L	 	ACR	 	365	 	0.1	 	0.1	 	0.1	 	G	 	GB	 	A	 	A	 	3	 	0	 	1
	CRG	 	 	 	Nitrogen	 	7727-37-9	 	N	 	P	 	G	 	A	 	365	 	50	 	400	 	350	 	cuft	 	DEW	 	G	 	L	 	3	 	0	 	0
	NFG	 	 	 	Nitrogen Compressed	 	7727-37-9	 	N	 	P	 	G	 	P	 	365	 	291	 	291	 	600	 	CF	 	CY	 	G	 	A	 	0	 	0	 	0
	CRG	 	 	 	Nitrogen Compressed	 	7727-37-9	 	N	 	P	 	G	 	A	 	365	 	304	 	304	 	304	 	cuft	 	CY	 	G	 	L	 	3	 	0	 	0
	NFG	 	 	 	Nitrogen Compressed	 	7727-37-9	 	N	 	P	 	G	 	A P	 	365	 	304	 	304	 	304	 	CF	 	CYL	 	G	 	A	 	0	 	0	 	0
	IRR	 	Hapes	 	N-LZ Hydroxyethy Piperazine N- Ether	 	17365-45-9	 	N	 	P	 	S	 	C	 	365	 	0.1	 	0.25	 	0.1	 	P	 	PB	 	A	 	A	 	1	 	1	 	0
	OXY	 	 	 	Oxygen 50%/CO2 50%	 	7782-44-7	 	N	 	M	 	G	 	PF	 	365	 	117	 	117	 	117	 	CF	 	CY	 	G	 	A	 	1	 	0	 	0
	OXY	 	 	 	Oxygen 50%/Nitrogen 50%	 	7782-44-7	 	N	 	M	 	G	 	PF	 	365	 	250	 	1250	 	1250	 	CF	 	CY	 	G	 	A	 	1	 	0	 	0
	RAD	 	 	 	P-32	 	 	 	N	 	P	 	S/L	 	C	 	365	 	1	 	10	 	2	 	mCi	 	GB	 	A	 	A	 	 	 	 	 	 
	TOX	 	 	 	Paraformaldehyde 16%	 	3052S-89-4	 	Y	 	M	 	L	 	AC	 	365	 	0.05	 	0.1	 	0.1	 	G	 	GB	 	A	 	A	 	3	 	1	 	0
	IRR	 	 	 	Perchloric Acid	 	7601-90-3	 	N	 	P	 	L	 	CA	 	365	 	0.1	 	0.2	 	0.2	 	G	 	GB	 	A	 	A	 	2	 	0	 	0
	TOX	 	 	 	Phenol	 	108-95-2	 	Y	 	P	 	L	 	ACF	 	365	 	0.25	 	0.25	 	0.25	 	G	 	GB	 	A	 	A	 	4	 	2	 	0
	TOX	 	 	 	Phenol	 	108-95-2	 	N	 	P	 	L	 	A	 	365	 	0.1	 	0.1	 	0.1	 	G	 	GB	 	A	 	A	 	4	 	2	 	0
	TOX	 	 	 	Phenol Chloroform	 	67-66-3	 	Y	 	P	 	L	 	CA	 	365	 	0.1	 	0.1	 	0.1	 	G	 	GB	 	A	 	A	 	3	 	0	 	1
	CCH	 	 	 	Phenylmethy Sulfuryl	 	329-98-6	 	N	 	P	 	S	 	A/C	 	365	 	0.25	 	0.25	 	0.25	 	P	 	GB	 	A	 	A	 	3	 	0	 	1
	COR/TOX	 	Phenylmethylsulfuryl Fluoride	 	329-98-6	 	N	 	P	 	S	 	A	 	365	 	0.5	 	5.00	 	2.5	 	P	 	GB	 	A	 	A	 	3	 	0	 	1
	COR	 	 	 	Phosphoric Acid	 	766-38-2	 	N	 	P	 	L	 	A	 	365	 	0.2	 	0.25	 	0.2	 	G	 	GB	 	A	 	A	 	3	 	0	 	0
	COR	 	 	 	Phosphoric Acid	 	766-38-2	 	N	 	P	 	L	 	A	 	365	 	0.1	 	0.5	 	0.25	 	G	 	GB	 	A	 	A	 	3	 	0	 	0
	IRR	 	 	 	Polyoxyethylene Sorbitan	 	9005-64-5	 	N	 	M	 	L	 	C	 	365	 	0.1	 	0.20	 	0.1	 	G	 	PB	 	A	 	A	 	1	 	0	 	0
	OHH	 	 	 	Potassium Chloride	 	7447-40-7	 	N	 	P	 	L	 	C	 	365	 	0.2	 	0.25	 	0.2	 	G	 	GB	 	A	 	A	 	1	 	0	 	0
	COR	 	 	 	Potassium Hydroxide	 	1310-58-3	 	N	 	P	 	L	 	ACR	 	365	 	0.25	 	0.5	 	0.25	 	G	 	PB	 	A	 	A	 	3	 	0	 	1
	IRR	 	 	 	Pyruvic Acid	 	127-17-3	 	N	 	0	 	S	 	C	 	365	 	0.25	 	0.5	 	0.25	 	P	 	PB	 	A	 	A	 	2	 	1	 	0
	FL	 	 	 	Rossville Alcohol 200 Proof	 	64-17-5	 	N	 	P	 	L	 	CAF	 	365	 	1	 	10	 	0	 	G	 	GB	 	A	 	A	 	1	 	3	 	0
	OHH	 	Salt	 	Salt	 	7647-14-5	 	N	 	P	 	S	 	C	 	365	 	23	 	500	 	500	 	P	 	Bag	 	A	 	A	 	1	 	0	 	0
	OX	 	 	 	Silver Nitrate	 	7761-88-98	 	N	 	P	 	L	 	A R	 	365	 	0.1	 	0.10	 	0.1	 	P	 	PB	 	A	 	A	 	4	 	0	 	0
	OYR	 	Fixer	 	Silver Nitrate (0.1%)	 	7761-88-8	 	N	 	M	 	L	 	C	 	365	 	10	 	20	 	10	 	G	 	PB	 	A	 	A	 	1	 	0	 	0
	OHH	 	 	 	Sodium Heparin	 	9D41-D8-1	 	N	 	P	 	S	 	A	 	365	 	0.1	 	0.10	 	0.10	 	P	 	GB	 	A	 	A	 	1	 	1	 	0

31

   Exhibit C to Lease Agreement dated January 22, 2002  

Abgenix                  Estimated Chemical Inventory for B-6  

	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	NFPA

	Hazard

Class
	 	Common

Name
	 	 
	 	 
	 	Extremely

Hazardous?
	 	Pure or

Mixture
	 	Solid,

Gas or

Liquid
	 	Fed

Haz Cat
	 	Days

on Site
	 	Largest

Container
	 	Max.

Amount
	 	Avg

Amount
	 	Units

(lbs, gal, cu ft)
	 	 
	 	 
	 	 

	 	Chemical Name
	 	CAS #
	 	Container
	 	Pressure
	 	Temp
	 	Health
	 	Fire
	 	Reactivity

	TOX	 	 	 	Sodium Azide	 	26528-22-0	 	Y	 	P	 	S	 	ACR	 	365	 	0.25	 	0.5	 	0.25	 	P	 	GB	 	A	 	A	 	3	 	1	 	3
	DVR	 	Developer	 	Sodium Bissulfate (0.5%)	 	7601-38-1	 	N	 	M	 	L	 	C	 	365	 	10	 	20	 	10	 	G	 	PB	 	A	 	A	 	1	 	0	 	0
	OHH	 	 	 	Sodium Chloride	 	7647-14-5	 	N	 	P	 	S	 	C	 	365	 	0.5	 	0.1	 	0.5	 	P	 	PB	 	A	 	A	 	1	 	0	 	0
	OHH	 	TRYPAN BLUE SOLUTION	 	SODIUM CHLORIDE	 	75-57-1	 	N	 	M	 	L	 	C	 	365	 	0.1	 	0.2	 	0.1	 	G	 	PB	 	A	 	A	 	1	 	0	 	0
	COR	 	Luminey	 	Sodium Chloride Sodium Phosphate	 	7647-14-5

7722-88-5	 	N	 	M	 	L	 	C	 	365	 	5	 	10	 	5	 	G	 	GB	 	A	 	A	 	1	 	0	 	0
	COR	 	 	 	Sodium Hydroxide	 	1310-73-2	 	N	 	P	 	L	 	A/C	 	365	 	2.5	 	20	 	10	 	G	 	PB	 	A	 	A	 	3	 	0	 	1
	IRR	 	Bleach	 	Sodium Hypochloride	 	7681-52-9	 	N	 	P	 	L	 	A	 	365	 	1	 	20	 	10	 	G	 	PR	 	A	 	A	 	2	 	0	 	1
	IRR	 	 	 	Sodium Orthorariadate	 	13721-39-6	 	N	 	P	 	S	 	A	 	365	 	0.25	 	0.50	 	0.25	 	P	 	PB	 	A	 	A	 	2	 	0	 	0
	OX	 	 	 	Sodium Perchlorate	 	1791-07-3	 	N	 	P	 	S	 	AR	 	365	 	0.1	 	0.25	 	0.1	 	P	 	PB	 	A	 	A	 	2	 	0	 	1
	HTOX	 	 	 	Sodium Selenite	 	10102-18-8	 	Y	 	P	 	S	 	C/A	 	365	 	0.1	 	0.1	 	0.1	 	P	 	BOX	 	A	 	A	 	3	 	0	 	0
	CL	 	WD 40	 	Standard Solvent	 	8052-41-3	 	N	 	M	 	L	 	C	 	365	 	0.5	 	0.5	 	0.5	 	CUFT	 	CA	 	G	 	A	 	1	 	2	 	0
	COR	 	 	 	Sulfuric Acid	 	7684-93-9	 	Y	 	P	 	L	 	AR	 	365	 	0.2	 	0.5	 	0.2	 	G	 	GB	 	A	 	A	 	3	 	0	 	2
	IRR	 	 	 	Tetraethylammonium Chloride Hydrate	 	56-34-8	 	N	 	P	 	S	 	C	 	365	 	0.25	 	0.5	 	0.25	 	P	 	GB	 	A	 	A	 	2	 	0	 	0
	FL	 	Permount	 	Toluene, piocolyte	 	108-08-33	 	N	 	M	 	L	 	AF	 	365	 	0.1	 	0.2	 	0.1	 	G	 	GB	 	A	 	A	 	2	 	3	 	0
	COR	 	 	 	Trichloracelic Acid	 	76-02-9	 	N	 	P	 	S	 	C	 	365	 	0.5	 	1.00	 	1.00	 	P	 	GB	 	A	 	A	 	3	 	0	 	0
	FL	 	 	 	Tilethytamine	 	121-44-8	 	N	 	P	 	L	 	CAF	 	365	 	0.2	 	0.20	 	0.2	 	G	 	GB	 	A	 	A	 	2	 	3	 	0
	FL	 	 	 	Tilethytamine	 	121-44-8	 	N	 	P	 	L	 	ACF	 	365	 	0.1	 	0.1	 	0.1	 	G	 	GB	 	A	 	A	 	3	 	3	 	0
	COR	 	 	 	Telfluoroacetic Acid	 	76-05-1	 	N	 	P	 	L	 	A	 	365	 	0.1	 	0.5	 	0.1	 	G	 	GB	 	A	 	A	 	3	 	0	 	0
	IRR	 	 	 	Tris Hyrdoxymethyl	 	77-86-1	 	N	 	P	 	S	 	C	 	365	 	2.2	 	2.2	 	2.2	 	P	 	PB	 	A	 	A	 	1	 	1	 	0
	IRR	 	 	 	Trion-x-100	 	9002-98-1	 	N	 	M	 	L	 	C	 	365	 	0.25	 	0.50	 	0.25	 	G	 	GB	 	A	 	A	 	2	 	1	 	0
	OHH	 	 	 	Trypan Blue Solution	 	72-57-1	 	N	 	P	 	L	 	A/C	 	365	 	0.2	 	0.1	 	0.1	 	G	 	PB	 	A	 	A	 	1	 	0	 	0
	IRR	 	 	 	Tween	 	9005-64-5	 	N	 	M	 	L	 	C	 	365	 	0.2	 	0.20	 	0.1	 	G	 	GB	 	A	 	A	 	1	 	0	 	0
	OHH	 	 	 	Urea	 	57-13-6	 	N	 	P	 	S	 	C	 	365	 	0.5	 	1.00	 	0.50	 	P	 	PB	 	A	 	A	 	1	 	0	 	0

32

  

 
 

EXHIBIT D TO LEASE AGREEMENT DATED JANUARY 22, 2002 BETWEEN THE
  JOHN ARRILLAGA SURVIVOR'S TRUST AND THE RICHARD T. PEERY
  SEPARATE PROPERTY TRUST, AS LANDLORD, AND
ABGENIX, INC., AS TENANT    
  

 
  HAZARDOUS MATERIALS REPORTS
  PROVIDED TO TENANT    
  

	1)
	Preliminary
Environmental Assessment and Soil Testing for Ardenwood Corporate Commons: prepared for Bedford Properties on August 10, 1988 by Kaldveer Associates;

	2)
	Preliminary
Environmental Assessment and Soil Testing for Ardenwood Corporate Commons Lots 1 through 27; prepared for Bedford Properties on June 13, 1989 by Kaldveer
Associates;

	3)
	Phase I
Site Assessment for Ardenwood Corporate Commons; prepared for Bedford Properties in July 1991 by Mittelhauser Corporation. 

33

QuickLinks

Exhibit 10.74

EXHIBIT B-1 Existing Tenant Improvements Not to Be Removed By Landlord Prior to Lease Commencement Date or During the Lease Term

Exhibit C to Lease Agreement dated January 22, 2002

EXHIBIT D TO LEASE AGREEMENT DATED JANUARY 22, 2002 BETWEEN THE JOHN ARRILLAGA SURVIVOR'S TRUST AND THE RICHARD T. PEERY SEPARATE PROPERTY TRUST, AS LANDLORD, AND ABGENIX, INC., AS TENANT

HAZARDOUS MATERIALS REPORTS PROVIDED TO TENANT<Page>

                                                                    Exhibit 10.1

                                    AGREEMENT

                  AGREEMENT, made and entered into as of April 19, 2002 ("the
Execution Date") by and between PRIMEDIA Inc., a Delaware corporation (together
with its successors and assigns permitted under this Agreement, the "Company"),
and Charles G. McCurdy (the "Executive").

                              W I T N E S S E T H:
                              - - - - - - - - - -

                  WHEREAS, the Company desires to employ the Executive and to
enter into an agreement embodying the terms of such employment (this
"Agreement") and the Executive desires to enter into this Agreement and to
accept such employment, subject to the terms and provisions of this Agreement;

                  NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein and for other good and valuable consideration, the
receipt of which is mutually acknowledged, the Company and the Executive
(individually a "Party" and together the "Parties") agree as follows:

                  1. DEFINITIONS.

                  (a) "Affiliate" of a person or other entity shall mean a
person or other entity that directly or indirectly controls, is controlled by,
or is under common control with the person or other entity specified.

                  (b) "Base Salary" shall mean the salary provided for in
Section 4 below or any increased salary granted to the Executive pursuant to
Section 4.

                  (c) "Board" shall mean the Board of Directors of the Company.

                  (d) "Cause" shall mean:

                  (i) the Executive is convicted of a felony involving moral
            turpitude or involving fraud against the Company; or

                  (ii) the Executive is guilty of willful gross neglect or
            willful gross misconduct, in carrying out his duties under this
            Agreement, including, without limitation, a non-appealable final
            determination by a court that he has committed sexual harassment,
            resulting, in either case, in material economic harm to the Company,
            unless the Executive reasonably believed in good faith that such act
            or nonact was in the best interests of the Company.

                  (e) "Change in Control" shall mean the occurrence of any one
of the following events:

<Page>

                  (i) a transaction or series of related transactions whereby
            KRR Associates and/or its Affiliates ("KKR") (a) sells or otherwise
            disposes of beneficial ownership (within the meaning of Rule 13d-3
            of the Securities Exchange Act of 1934, as amended (the "1934 Act"))
            of securities of the Company representing 35% or more of the
            combined voting power of all securities of the Company entitled to
            vote in the election of directors of the Company to any single
            person or group (within the meaning of Section 13(d) (3) of the 1934
            Act, and the rules and regulations promulgated thereunder), other
            than to an Affiliate of KKR, and in connection with or following
            such disposition such single person or group obtains control of a
            majority of the seats (other than vacant seats) on the Board.

                  (ii) the Company adopts any plan of liquidation providing for
            the distribution of all or substantially all of its assets;

                  (iii) all or substantially all of the assets or business of
            the Company is disposed of pursuant to a merger, consolidation or
            other transaction (unless the shareholders of the Company
            immediately prior to such merger, consolidation or other transaction
            beneficially own, directly or indirectly, in substantially the same
            proportion as they owned the Voting Stock of the Company, all of the
            Voting Stock or other ownership interests of the entity or entities,
            if any, that succeed to the business of the Company); or

                  (iv) the Company combines with another company and is the
            surviving corporation but, immediately after the combination, the
            shareholders of the Company immediately prior to the combination
            hold, directly or indirectly, 50% or less of the Voting Stock of the
            combined company (there being excluded from the number of shares
            held by such shareholders, but not from the Voting Stock of the
            combined company, any shares received by Affiliates of such other
            company in exchange for stock of such other company).

                  (f) "Constructive Termination Without Cause" shall mean
termination by the Executive of his employment at his initiative following the
occurrence of any of the following events without his consent:

                  (i) a reduction in the Executive's initial Base Salary or
            target bonus opportunity or the termination or material reduction of
            any employee benefit or perquisite enjoyed by him (other than as
            part of an across-the-board reduction applicable to all executive
            officers of the Company);

                  (ii) the failure to elect or reelect the Executive to any of
            the positions described in Section 3 or the removal of him from any
            such position;

                  (iii) a material diminution in the Executive's duties and
            responsibilities as described in Section 3 or the assignment to the
            Executive of duties or responsibilities which are materially
            inconsistent with his duties and responsibilities as described in
            Section 3 or which materially impair the Executive's ability to
            function as the President of the Company;

                                       2
<Page>

                  (iv) the relocation of the Company's principal office, or the
            Executive's own office location, as assigned to him by the Company,
            other than a relocation at the Executive's initiative, to a location
            more than 50 miles from New York, New York; or

                  (v) the failure of the Company to obtain the assumption in
            writing of its obligation to perform this Agreement by any successor
            to all or substantially all of the assets of the Company within 30
            calendar days after a merger, consolidation, sale or similar
            transaction.

                  Following written notice from the Executive of any of the
events described in (i) through (v) above, the Company shall have 30 calendar
days in which to cure. If the Company fails to cure, the Executive's termination
shall become effective on the 31st calendar day following the written notice.

                  (g) "Disability" shall mean the Executive's inability, due to
physical or mental incapacity, to substantially perform his duties and
responsibilities under this Agreement as determined by a medical doctor selected
by the Company and the Executive. If the Parties cannot agree on a medical
doctor, each Party shall select a medical doctor and the two doctors shall
select a third who shall be the approved medical doctor for this purpose.

                  (h) "Effective Date" shall be January 1, 2002.

                  (i) "Execution Date" shall mean the date on which this
Agreement is executed by both Parties.

                  (j) Not used.

                  (k) "Pro Rata" shall mean a fraction, the numerator of which
is the number of days that the Executive was employed in the applicable
performance period (a calendar year in the case of an annual bonus) and the
denominator of which shall be the number of days in the applicable performance
period.

                  (l) "Stock" shall mean the Common Stock of the Company.

                  (m) "Term of Employment" shall mean the period specified in
Section 2 below (including any extension as provided therein).

                  (n) "Voting Stock" shall mean capital stock of any class or
classes having general voting power under ordinary circumstances, in the absence
of contingencies, to elect the directors of a corporation.

                                       3
<Page>

                  2. TERM OF EMPLOYMENT.

                  The Term of Employment shall begin on the Effective Date, and
shall extend until the fourth anniversary of the Effective Date, with automatic
one-year renewals thereafter unless either Party notifies the other at least 6
months before the scheduled expiration date that the term is not to renew.
Notwithstanding the foregoing, the Term of Employment may be earlier terminated
by either Party in accordance with the provisions of Section 12.

                  3. POSITION, DUTIES AND RESPONSIBILITIES.

                  (a) Commencing on the Effective Date and continuing for the
remainder of the Term of Employment, the Executive shall be employed as the
President of the Company and be responsible for the financial and operational
management of the affairs of the Company, as determined by the Company's Chief
Executive Officer. The Executive shall continue to serve as a member of the
Board if elected by the shareholders. The Executive, in carrying out his duties
under this Agreement, shall report to the Chief Executive Officer. During the
term of this Agreement, the Executive shall devote substantially all of his
business time and attention to the business and affairs of the Company and shall
use his best efforts, skills and abilities to promote its interests.

                  (b) Nothing herein shall preclude the Executive from (i)
serving on the boards of directors of a reasonable number of other corporations
with the concurrence of the Board (which approval shall not be unreasonably
withheld), (ii) serving on the boards of a reasonable number of trade
associations and/or charitable organizations, (iii) engaging in charitable
activities and community affairs, and (iv) managing his personal investments and
affairs, provided that such activities set forth in this Section 3 (b) do not
conflict or materially interfere with the effective discharge of his duties and
responsibilities under Section 3 (a).

                  4. BASE SALARY.

                  The Executive shall be paid an annualized Base Salary, payable
in accordance with the regular payroll practices of the Company, of $700,000.
The Base Salary shall be reviewed annually for increase in the discretion of the
Board.

                  5. ANNUAL INCENTIVE AWARD.

                  The Executive shall participate in the Company's Senior
Executive Incentive Bonus Plan. During the Term of Employment, commencing in
2002, the Executive shall have a target bonus opportunity each year equal to 55%
of the Executive's actually paid Base Salary for that year, payable in that
amount if the performance goals established for the relevant year are met. The
Executive may receive a greater or lesser amount (or nothing) as determined in
accordance with agreed upon measures and benchmarks. In addition, the Executive
may receive an additional bonus payment, in the Board's sole discretion,
relating to the currently contemplated restructuring/reformation program. The
parties agree that in subsequent periods bonus payments may be made, in the
Board's sole discretion, for exceptional performance by the Executive.

                                       4
<Page>

                  6. NOT USED.

                  7. EQUITY AWARDS.

                  (a) Intentionally left blank.

                  (b) Going Private Protection. The Executive's options on stock
of the Company granted prior to 2002 will continue in the event of a Going
Private Transaction. Prior to any such Transaction, the Company and the
Executive shall negotiate, in good faith, definitive agreements governing the
rights of the Executive following such event, it being the intention of the
Parties to provide the Executive with a comparable equity opportunity to that
contemplated at the time such stock options were granted. The agreements will
specify, among other things, that the Executive will have the opportunity to
sell his equity interests resulting from such stock options on a basis
comparable to sales made by KKR, on behalf of itself and its fund investors, and
will have terms governing registration rights, tag-along rights, anti-dilution
rights and puts and calls between the holders of equity interests and the
Company comparable to those held by KKR on behalf of itself and its fund
investors. The agreement will also specify how the Executive will be able to
avail himself of full liquidity in the case of death, disability and termination
without Cause or Constructive Termination without Cause, so as to continue to
effectuate the intent of Section 12 with respect to any such termination.

                  8. ADDITIONAL STOCK OPTION AWARDS.

                  The Executive may be eligible for stock option awards
commencing with awards in 2002 in accordance with the Company's practices
applicable to its senior-level executives at the sole discretion of the Board.

                  9. EMPLOYEE BENEFIT PROGRAMS.

                  During the Term of Employment, the Executive shall be entitled
to participate in any employee pension and welfare benefit plans and programs
made available to the Company's senior level executives or to its employees
generally, as such plans or programs may be in effect from time to time,
including, without limitation, pension, profit sharing, savings and other
retirement plans or programs, 401(k), medical, dental, hospitalization,
short-term and long-term disability and life insurance plans, accidental death
and dismemberment protection, travel accident insurance, and any other pension
or retirement plans or programs and any other employee welfare benefit plans or
programs that may be sponsored by the Company from time to time, including any
plans that supplement the above-listed types of plans or programs, whether
funded or unfunded. The Executive's participation shall be based on, and the
calculation of all benefits shall be based on, the assumptions that the
Executive has met all service-period or other requirements for such
participation provided that no such assumptions shall be made as to a
tax-qualified plan if such assumption would jeopardize the tax-qualified status
of such plan.

                  10. SUPPLEMENTAL PENSION.

                  The Company has adopted a senior employee retirement plan in
which the Executive is a participant for whose benefit contributions have been
made and which is currently suspended. The Executive's participation therein
shall continue at levels and on terms

                                       5
<Page>

commensurate with his service with the Company and the benefits accorded others
when and if such suspension is lifted.

                  11. REIMBURSEMENT OF BUSINESS AND OTHER EXPENSES; PERQUISITES;
VACATIONS.

                  (a) The Executive is authorized to incur reasonable expenses
in carrying out his duties and responsibilities under this Agreement and the
Company shall promptly reimburse him for all reasonable business expenses
incurred in connection with carrying out the business of the Company, subject to
documentation in accordance with the Company's policy. The Company shall pay all
reasonable financial consultant and legal fees and expenses incurred by the
Executive in connection with the negotiation of the Executive's employment
arrangements with the Company.

                  (b) During the Term of Employment, the Executive shall be
entitled to tax preparation, financial counseling, first-class air travel and
limousine services and in addition any other perquisites in effect from time to
time for the Company's senior executives generally.

                  (c) The Executive shall be entitled to vacation in accordance
with the Company's vacation policy for senior executives.

                  12. TERMINATION OF EMPLOYMENT.

                  (a) Termination Due to Death. In the event that the
Executive's employment is terminated due to his death, his estate or his
beneficiaries, as the case may be, shall be entitled to the following benefits:

                  (i) Base Salary through the end of the month in which death
            occurs;

                  (ii) annual incentive award for the year in which the
            Executive's death occurs, based on the original target award
            performance for such year, payable in a single installment promptly
            after his death; and

                  (iii) all options on shares of the Company granted the
            Executive prior to 2002, whether or not then exercisable, shall
            become exercisable and shall remain exercisable until the end of
            their scheduled terms.

                  (b) Termination Due to Disability. In the event that the
Executive's employment is terminated due to his Disability, he shall be entitled
to the following benefits:

                  (i) disability benefits in accordance with the long-term
            disability program then in effect for senior executives of the
            Company;

                  (ii) Base Salary through the end of the month in which
            disability benefits commence;

                  (iii) annual incentive award for the year in which the
            Executive's termination occurs, based on the original target award
            for such year, payable in a single installment promptly after his
            termination; and

                                       6
<Page>

                  (iv) all options on shares of the Company granted the
            Executive prior to 2002, whether or not then exercisable, shall
            become exercisable and shall remain exercisable until the end of
            their scheduled terms.

                  In no event shall a termination of the Executive's employment
for Disability occur until the Party terminating his employment gives written
notice to the other Party in accordance with Section 23 below. (c) Termination
by the Company for Cause.

                  (i) A termination for Cause shall not take effect unless the
            provisions of this paragraph (i) are complied with. The Executive
            shall be given written notice by the Board of the intention to
            terminate him for Cause, such notice (A) to state in detail the
            particular act or acts or failure or failures to act that constitute
            the grounds on which the proposed termination for Cause is based and
            (B) to be given within six months of the Board learning of such act
            or acts or failure or failures to act. The Executive shall have ten
            calendar days after the date that such written notice has been given
            to the Executive in which to cure such conduct, to the extent such
            cure is possible. If he fails to cure such conduct or such cure is
            not possible, the Executive shall then be entitled to a hearing
            before the Board. Such hearing shall be held within 15 calendar days
            of such notice to the Executive, provided he requests such hearing
            within ten calendar days of the written notice from the Board of the
            intention to terminate him for Cause. If, within five calendar days
            following such hearing, the Executive is furnished written notice by
            the Board confirming that, in its judgment, grounds for Cause on the
            basis of the original notice exist, he shall thereupon be terminated
            for Cause.

                  (ii) In the event the Company terminates the Executive's
            employment for Cause:

                       (A) he shall be entitled to Base Salary through the date
                  of the termination; and

                       (B) all options on shares of the Company granted the
                  Executive prior to 2002 which are not then exercisable shall
                  be forfeited; any such options which are then exercisable
                  shall remain exercisable until the earlier of the forty-fifth
                  day after the date of termination or the originally scheduled
                  expiration date of the options unless the Compensation
                  Committee determines otherwise.

                  (d) Termination without Cause or Constructive Termination
without Cause. In the event the Executive's employment is terminated by the
Company without Cause, other than due to Disability or death, or in the event
there is a Constructive Termination without Cause, the Executive shall be
entitled to the following benefits:

                  (i) Base Salary through the date of termination;

                  (ii) Base Salary, at the annualized rate in effect on the date
            of termination, for a period of 24 months following such
            termination, provided that, at the Executive's option, the Company
            shall pay him the present value of such salary continuation payments
            in a

                                       7
<Page>

            lump sum (using as the discount rate the Applicable Federal Rate
            specified under Section 1274 of the Internal Revenue Code of 1986,
            as amended (the "Code"), for short-term Treasury obligations as
            published by the Internal Revenue Service for the month in which
            such termination occurs);

                  (iii) a Pro Rata annual incentive award for the year in which
            termination occurs, based on his original target award for such
            year, payable when annual incentive awards are paid to other senior
            executives (or in a lump sum in accordance with the proviso in
            Section 12 (d) (ii));

                  (iv) an annual incentive award for a period of 24 months
            following the date of termination, based on his original target
            award for the year in which termination occurs and payable in 24
            equal monthly installments over the 24-month period following such
            termination;

                  (v) All options on shares of the Company granted the Executive
            prior to 2002, whether or not then exercisable, shall become
            exercisable and shall remain exercisable until the end of their
            scheduled terms; and

                  (vi) the Executive shall be entitled to continued
            participation in all medical, dental, vision and hospitalization
            insurance coverage and in other employee benefit plans or programs
            in which he was participating on the date of his termination until
            the earlier of:

                       (A) 24 months following the date of termination and

                       (B) the date, or dates, he becomes eligible for coverage
                  and benefits under the plans and programs of a subsequent
                  employer. The Executive shall promptly advise the Company of
                  any such subsequent employment and the benefits he receives in
                  connection therewith.

                  In the event the Company's plans do not permit continuation of
Executive's participation following his termination, the Company shall provide
the Executive with an amount which, after taxes, is sufficient for him to
purchase equivalent benefits.

                  (e) Voluntary Termination. A termination of employment by the
Executive on his own initiative, other than a termination due to death or
Disability or a Constructive Termination without Cause or retirement following
the end of the Term of Employment, shall have the same consequences as provided
in Section 12 (c) (ii) for a termination for Cause. A voluntary termination
under this Section 12 (e) shall be effective 30 calendar days after prior
written notice is received by the Company, unless the Company elects to make it
effective earlier.

                  (f) Non-renewal by the Company. In the event that the Company
notifies the Executive pursuant to Section 2 of this Agreement that the Term of
Employment shall not renew, the Executive shall be entitled to the same benefits
as provided in Section 12 (d); provided, however that the period for which
entitlements are provided shall be 12 months instead of 24 months in all
subsections where provision of a 24 month period is specifically made.

                                       8
<Page>

                  (g) Consequences of a Change in Control.

                  (i) Following a Change in Control, in the event of the
            Executive's termination of employment pursuant to Section 12 (d),
            the Executive shall be entitled to the benefits provided in Section
            12 (d) above for the periods provided therein and paid in accordance
            therewith as well as to the benefits provided in Section 12 (g) (ii)

                  (ii) Upon a Change in Control, whether or not he remains
            employed, all amounts, rights and benefits to which the Executive is
            entitled at the Company but not yet vested, whether under this
            Agreement or otherwise, shall become fully vested, except for stock
            options granted in 2002 or thereafter which shall be governed by the
            option agreement covering such options. With respect to those stock
            options, vesting shall be in the sole discretion of the Board.

                  (iii) In the event that any amount or benefit (collectively,
            the "Covered Payments") paid or distributed to the Executive by the
            Company or any Affiliate incurs an excise tax under Section 4999 of
            the Internal Revenue Code of 1986, as amended (the "Code") or any
            similar tax that may hereafter be imposed ("Excise Tax"), the
            Company shall pay to Executive at the time specified below, the Tax
            Reimbursement Payment. The Tax Reimbursement Payment is defined as
            an amount which, after imposition of all income, employment and
            excise taxes thereon, is equal to the Excise Tax on the Covered
            Payments. The determination of whether Covered Payments are subject
            to Excise Tax and, if so, the amount of the Tax Reimbursement
            Payment to be paid to the Executive shall be made by an independent
            auditor (the "Auditor") jointly selected by the Company and the
            Executive and paid by the Company. The Auditor shall be a nationally
            recognized United States public accounting firm which has not,
            during the two years preceding the date of its selection, acted in
            any way on behalf of the Company. If the Executive and the Company
            cannot agree on the firm to serve as the Auditor, then Executive and
            the Company shall each select an accounting firm and those two firms
            shall jointly select the accounting firm to serve as the Auditor.
            The portion of the Tax Reimbursement Payment attributable to a
            Covered Payment shall be paid to the Executive by the Company prior
            to the date that the corresponding Excise Tax payment is due to be
            paid by the Executive (through withholding or otherwise). The
            Executive covenants that he will use the Tax Reimbursement Payment
            under this subsection (iii) for the sole purpose of paying the
            Excise Tax.

                  (h) Other Termination Benefits. In the case of any of the
foregoing terminations, the Executive or his estate shall also be entitled to:

                  (i) the balance of any incentive awards due for performance
            periods which have been completed, but which have not yet been paid
            provided that upon Termination for Cause or Voluntary Termination,
            no discretionary portion of any then unpaid incentive award shall be
            paid;

                  (ii) any expense reimbursements due the Executive; and

                                       9
<Page>

                  (iii) other benefits, if any, in accordance with applicable
            plans and programs of the Company.

                  (i) No Mitigation; No Offset. In the event of any termination
of employment under this Section 12, the Executive shall be under no obligation
to seek other employment and there shall be no offset against amounts due the
Executive under this Agreement on account of any remuneration attributable to
any subsequent employment that he may obtain.

                  (j) Nature of Payments. Any amounts due under this Section 12
are in the nature of severance payments considered to be reasonable by the
Company and are not in the nature of a penalty.

                  13. CONFIDENTIALITY.

                  (a) The Executive agrees that he will not, at any time during
the Term of Employment or thereafter, disclose or use any trade secret,
proprietary or confidential information of the Company or any subsidiary or
Affiliate of the Company, obtained during the course of his employment, except
as required in the course of such employment or with the written permission of
the Company or, as applicable, any subsidiary or Affiliate of the Company or as
may be required by law, provided that, if the Executive receives legal process
with regard to disclosure of such information, he shall promptly notify the
Company and cooperate with the Company in seeking a protective order.

                  (b) The Executive agrees that at the time of the termination
of his employment with the Company, whether at the instance of the Executive or
the Company, and regardless of the reasons therefor, he will deliver to the
Company, and not keep or deliver to anyone else, any and all notes, files,
memoranda, papers and, in general, any and all physical matter containing
information, including any and all documents significant to the conduct of the
business of the Company or any subsidiary or Affiliate of the Company which are
in his possession, except for any documents for which the Company or any
subsidiary or Affiliate of the Company has given written consent to removal at
the time of the termination of the Executive's employment and his personal
rolodex, personal files, phone book and similar items.

                  (c) The Executive agrees that the Company's remedies at law
would be inadequate in the event of a breach or threatened breach of this
Section 13; accordingly, the Company shall be entitled, in addition to its
rights at law, to seek an injunction and other equitable relief without the need
to post a bond.

                  14. RESOLUTION OF DISPUTES.

                  Any disputes arising under or in connection with this
Agreement shall be resolved by third party mediation of the dispute and, failing
that, by binding arbitration, to be held in New York, in accordance with the
rules and procedures of the American Arbitration Association. Judgment upon the
award rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof. Each Party shall bear his or its own costs of the
mediation, arbitration or litigation.

                                       10
<Page>

                  15. INDEMNIFICATION.

                  (a) The Company agrees that if the Executive is made a party,
or is threatened to be made a party, to any action, suit or proceeding, whether
civil, criminal, administrative or investigative ("Proceeding"), by reason of
the fact that he is or was a director, officer or employee of the Company or any
of its subsidiaries or affiliates or is or was serving at the request of the
Company as a director, officer, member, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, including
service with respect to employee benefit plans, whether or not the basis of such
Proceeding is the Executive's alleged action in an official capacity while
serving as a director, officer, member, employee or agent, the Executive shall
be indemnified and held harmless by the Company to the fullest extent legally
permitted or authorized by the Company's certificate of incorporation or bylaws
or resolutions of the Company's Board of Directors or, if greater, by the laws
of the State of Delaware, against all cost, expense, liability and loss
(including, without limitation, attorney's fees, judgments, fines, ERISA excise
taxes or other liabilities or penalties and amounts paid or to be paid in
settlement) reasonably incurred or suffered by the Executive in connection
therewith, and such indemnification shall continue as to the Executive even if
he has ceased to be a director, member, employee or agent of the Company or
other entity and shall inure to the benefit of the Executive's heirs, executors
and administrators. The Company shall advance to the Executive all reasonable
costs and expenses incurred by him in connection with a Proceeding within 20
calendar days after receipt by the Company of a written request for such
advance. Such request shall include an undertaking by the Executive to repay the
amount of such advance if it shall ultimately be determined that he is not
entitled to be indemnified against such costs and expenses.

                  (b) Neither the failure of the Company (including its board of
directors, independent legal counsel or stockholders) to have made a
determination prior to the commencement of any proceeding concerning payment of
amounts claimed by the Executive under Section 15 (a) above that indemnification
of the Executive is proper because he has met the applicable standard of
conduct, nor a determination by the Company (including its board of directors,
independent legal counsel or stockholders) that the Executive has not met such
applicable standard of conduct, shall create a presumption that the Executive
has not met the applicable standard of conduct.

                  (c) The Company agrees to continue and maintain a directors'
and officers' liability insurance policy covering the Executive to the extent
the Company provides such coverage for its other executive officers.

                  16. ASSIGNABILITY; BINDING NATURE.

                  This Agreement shall be binding upon and inure to the benefit
of the Parties and their respective successors, heirs (in the case of the
Executive) and assigns. Rights or obligations of the Company under this
Agreement may be assigned or transferred by the Company pursuant to a merger or
consolidation in which the Company is not the continuing entity, or the sale or
liquidation of all or substantially all of the assets of the Company, provided
that the assignee or transferee is the successor to all or substantially all of
the assets of the Company and such assignee or transferee assumes the
liabilities, obligations and duties of the Company, as

                                       11
<Page>

contained in this Agreement, either contractually or as a matter of law. The
Company further agrees that, in the event of a sale of assets or liquidation as
described in the preceding sentence, it shall take whatever action it reasonably
can in order to cause such assignee or transferee to expressly assume the
liabilities, obligations and duties of the Company hereunder. No rights or
obligations of the Executive under this Agreement may be assigned or transferred
by the Executive other than his rights to compensation and benefits, which may
be transferred only by will or operation of law.

                  17. ENTIRE AGREEMENT.

                  This Agreement contains the entire understanding and agreement
between the Parties concerning the subject matter hereof and supersedes all
prior agreements, understandings, discussions, negotiations and undertakings,
whether written or oral, between the Parties with respect thereto.

                  18. AMENDMENT OR WAIVER.

                  No provision in this Agreement may be amended unless such
amendment is agreed to in writing and signed by the Executive and an authorized
officer of the Company. No waiver by either Party of any breach by the other
Party of any condition or provision contained in this Agreement to be performed
by such other Party shall be deemed a waiver of a similar or dissimilar
condition or provision at the same or any prior or subsequent time. Any waiver
must be in writing and signed by the Executive or an authorized officer of the
Company, as the case may be.

                  19. SEVERABILITY.

                  In the event that any provision or portion of this Agreement
shall be determined to be invalid or unenforceable for any reason, in whole or
in part, the remaining provisions of this Agreement shall be unaffected thereby
and shall remain in full force and effect to the fullest extent permitted by law
so as to achieve the purposes of this Agreement.

                  20. SURVIVORSHIP.

                  Except as otherwise expressly set forth in this Agreement, the
respective rights and obligations of the Parties hereunder shall survive any
termination of the Executive's employment. This Agreement itself (as
distinguished from the Executive's employment) may not be terminated by either
Party without the written consent of the other Party. Upon the expiration of the
term of the Agreement, the respective rights and obligations of the Parties
shall survive such expiration to the extent necessary to carry out the
intentions of the Parties as embodied in the rights (such as vested rights) and
obligations of the Parties under this Agreement.

                  21. REFERENCES.

                  In the event of the Executive's death or a judicial
determination of his incompetence, reference in this Agreement to the Executive
shall be deemed, where appropriate, to refer to his beneficiary, estate or other
legal representative.

                                       12
<Page>

                  22. GOVERNING LAW.

                  This Agreement shall be governed in accordance with the laws
of New York without reference to principles of conflict of laws.

                  23. NOTICES.

                  All notices and other communications required or permitted
hereunder shall be in writing and shall be deemed given when (a) delivered
personally, (b) delivered by certified or registered mail, postage prepaid,
return receipt requested or (c) delivered by overnight courier (provided that a
written acknowledgment of receipt is obtained by the overnight courier) to the
Party concerned at the address indicated below or to such changed address as
such Party may subsequently give such notice of:

                  If to the Company:

                           PRIMEDIA Inc.
                           745 Fifth Avenue
                           New York, New York 10151

                  If to the Executive:

                           Charles G. McCurdy
                           c/o PRIMEDIA Inc.
                           745 Fifth Avenue
                           New York, New York 10151

                  24. HEADINGS.

                  The headings of the sections contained in this Agreement are
for convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.

                  25.  COUNTERPARTS.

                  This Agreement may be executed in two or more counterparts.

                  26.  NON-COMPETITION.

                  a. "Competing Business" shall mean a business whose primary
business is one or more of the following: the publication and distribution of
business magazines, consumer magazines, free publications or the operation of
content websites, distance learning businesses or educational video businesses.

                  b. "Restricted Period" shall mean the last day of the period
which is 180 days following the date of termination

                                       13
<Page>

                  c. Executive acknowledges and recognizes the highly
competitive nature of the businesses of the Company and its affiliates and
accordingly agrees as follows:

                  (i) During the Term and the Restricted Period, if any,
Executive will not directly or indirectly:

                  (A) engage in any business that is a Competing Business:

                  (B) enter the employ of, or render any services to, any person
or entity (or any division of any person or entity) which is a Competing
Business:

                  (C) acquire a financial interest in, or otherwise become
actively involved with or in, any Competing Business, directly or indirectly, as
an individual, partner, shareholder, officer, director, principal, agent,
trustee or consultant; or

                  (D) interfere with, or attempt to interfere with, business
relationships (whether formed before, on or after the date of this Agreement)
between the Company or any of its affiliates and its material customers, clients
or suppliers.

                  (ii) Notwithstanding anything to the contrary in this
            Agreement, Executive may, directly or indirectly own, solely as an
            investment, securities of any person engaged in a Competing Business
            which are publicly traded on a national or regional stock exchange
            or on the over-the-counter market if Executive (I) is not a
            controlling person of, or a member of a group which controls, such
            person and (ii) does not, directly or indirectly, own 5% or more of
            any class of securities of such person.

                  (iii) During the Term and the Restricted Period, if any,
            Executive will not, whether on Executive's own behalf or on behalf
            of or in conjunction with any person, company, business entity or
            other organization whatsoever, directly or indirectly:

                       (A) Hire any executive who was employed by the Company
                  as of the date of Executive's termination of employment with
                  the Company or who left the employment of the Company
                  coincident with, or within 180 days prior to or after, the
                  termination of Executive's employment with the Company.

                       (B) The Company and the Executive agree that in the
                  event the Executive violates the provisions of this Section 26
                  following termination of employment, the Company's sole remedy
                  shall be to cease payments being made under or recoup payments
                  previously made under Sections 12 (d) (ii) or (iv) or 12 (g).

<Page>

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

                                           PRIMEDIA Inc.

                                           By: _____________________________
                                               Thomas S. Rogers

                                               -----------------------------
                                               Charles G. McCurdy

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